Cover Page
Cover Page - shares | 3 Months Ended | |
Mar. 31, 2021 | May 01, 2021 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2021 | |
Document Transition Report | false | |
Entity File Number | 001-35986 | |
Entity Registrant Name | Esperion Therapeutics, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 26-1870780 | |
Entity Address, Address Line One | 3891 Ranchero Drive, Suite 150 | |
Entity Address, City or Town | Ann Arbor | |
Entity Address, State or Province | MI | |
Entity Address, Postal Zip Code | 48108 | |
City Area Code | 734 | |
Local Phone Number | 887-3903 | |
Title of 12(b) Security | Common Stock, par value $0.001 per share | |
Trading Symbol | ESPR | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 28,192,134 | |
Entity Central Index Key | 0001434868 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
Condensed Balance Sheets
Condensed Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 217,939 | $ 304,962 |
Prepaid clinical development costs | 443 | 844 |
Inventories | 20,030 | 16,136 |
Other prepaid and current assets | 34,163 | 23,954 |
Total current assets | 272,575 | 345,896 |
Property and equipment, net | 1,123 | 1,276 |
Right of use operating lease assets | 4,852 | 6,030 |
Intangible assets | 56 | 56 |
Total assets | 278,606 | 353,258 |
Current liabilities: | ||
Accounts payable | 30,342 | 51,975 |
Accrued clinical development costs | 7,549 | 7,663 |
Other accrued liabilities | 48,766 | 24,790 |
Revenue interest liability | 6,353 | 5,392 |
Deferred revenue from collaborations | 2,543 | 1,662 |
Operating lease liabilities | 2,340 | 2,587 |
Total current liabilities | 97,893 | 94,069 |
Convertible notes, net of issuance costs | 271,694 | 179,367 |
Revenue interest liability | 174,603 | 171,212 |
Operating lease liabilities | 2,520 | 3,454 |
Other long-term liabilities | 1,290 | 1,290 |
Total liabilities | 548,000 | 449,392 |
Commitments and contingencies (Note 5) | ||
Stockholders’ equity: | ||
Preferred stock, $0.001 par value; 5,000,000 shares authorized and no shares issued or outstanding as of March 31, 2021 and December 31, 2020 | 0 | 0 |
Common stock, $0.001 par value; 120,000,000 shares authorized as of March 31, 2021 and December 31, 2020; 28,176,917 shares issued at March 31, 2021 and 27,910,366 shares issued at December 31, 2020 | 26 | 26 |
Additional paid-in capital | 713,782 | 797,655 |
Treasury stock, at cost; 1,994,198 shares at March 31, 2021 and December 31, 2020 | (54,998) | (54,998) |
Accumulated deficit | (928,204) | (838,817) |
Total stockholders’ deficit | (269,394) | (96,134) |
Total liabilities and stockholders’ deficit | $ 278,606 | $ 353,258 |
Condensed Balance Sheets (Paren
Condensed Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Preferred stock, outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, authorized (in shares) | 120,000,000 | 120,000,000 |
Common stock, issued (in shares) | 28,176,917 | 27,910,366 |
Treasury stock (in shares) | 1,994,198 | 1,994,198 |
Condensed Statements of Operati
Condensed Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Revenues: | ||
Total Revenues | $ 7,978 | $ 1,840 |
Operating expenses: | ||
Cost of goods sold | 1,784 | 31 |
Research and development | 27,954 | 34,702 |
Selling, general and administrative | 61,064 | 41,553 |
Total operating expenses | 90,802 | 76,286 |
Loss from operations | (82,824) | (74,446) |
Interest expense | (8,125) | (4,171) |
Other income, net | 14 | 368 |
Net loss | $ (90,935) | $ (78,249) |
Net loss per common share - basic and diluted (in dollars per share) | $ (3.50) | $ (2.84) |
Weighted-average shares outstanding - basic and diluted (in shares) | 25,991,817 | 27,519,229 |
Other comprehensive loss: | ||
Unrealized loss on investments | $ 0 | $ (14) |
Comprehensive loss | (90,935) | (78,263) |
Product sales, net | ||
Revenues: | ||
Total Revenues | 6,350 | 858 |
Collaboration revenue | ||
Revenues: | ||
Total Revenues | $ 1,628 | $ 982 |
Condensed Statements of Stockho
Condensed Statements of Stockholders' Equity (Deficit) - USD ($) $ in Thousands | Total | Cumulative Effect, Period of Adoption, Adjustment | Cumulative Effect, Period of Adoption, Adjusted Balance | Common Stock | Common StockCumulative Effect, Period of Adoption, Adjusted Balance | Additional Paid-In Capital | Additional Paid-In CapitalCumulative Effect, Period of Adoption, Adjustment | Additional Paid-In CapitalCumulative Effect, Period of Adoption, Adjusted Balance | Accumulated Deficit | Accumulated DeficitCumulative Effect, Period of Adoption, Adjustment | Accumulated DeficitCumulative Effect, Period of Adoption, Adjusted Balance | Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss)Cumulative Effect, Period of Adoption, Adjusted Balance | Treasury Stock | Treasury StockCumulative Effect, Period of Adoption, Adjusted Balance |
Beginning balance (in shares) at Dec. 31, 2019 | 27,497,911 | ||||||||||||||
Beginning balance at Dec. 31, 2019 | $ 19,950 | $ 27 | $ 715,166 | $ (695,266) | $ 23 | $ 0 | |||||||||
Increase (Decrease) in Stockholders' Equity | |||||||||||||||
Exercise of stock options (in shares) | 40,133 | ||||||||||||||
Exercise of stock options | 1,014 | $ 1 | 1,013 | ||||||||||||
Vesting of restricted stock units (in shares) | 10,089 | ||||||||||||||
Vesting of restricted stock units | 0 | ||||||||||||||
Stock-based compensation | 7,053 | 7,053 | |||||||||||||
Other comprehensive loss | (14) | (14) | |||||||||||||
Net loss | (78,249) | (78,249) | |||||||||||||
Ending balance (in shares) at Mar. 31, 2020 | 27,548,133 | ||||||||||||||
Ending balance at Mar. 31, 2020 | (50,246) | $ 28 | 723,232 | (773,515) | 9 | 0 | |||||||||
Beginning balance (in shares) at Dec. 31, 2019 | 27,497,911 | ||||||||||||||
Beginning balance at Dec. 31, 2019 | $ 19,950 | $ 27 | 715,166 | (695,266) | 23 | 0 | |||||||||
Increase (Decrease) in Stockholders' Equity | |||||||||||||||
Accounting Standards Update [Extensible List] | espr:AccountingStandardsUpdate202006Member | ||||||||||||||
Ending balance (in shares) at Dec. 31, 2020 | 25,916,168 | 25,916,168 | |||||||||||||
Ending balance at Dec. 31, 2020 | $ (96,134) | $ (91,927) | $ (188,061) | $ 26 | $ 26 | 797,655 | $ (93,475) | $ 704,180 | (838,817) | $ 1,548 | $ (837,269) | 0 | $ 0 | (54,998) | $ (54,998) |
Increase (Decrease) in Stockholders' Equity | |||||||||||||||
Exercise of stock options (in shares) | 172,268 | 172,268 | |||||||||||||
Exercise of stock options | $ 2,668 | 2,668 | |||||||||||||
Vesting of restricted stock units (in shares) | 43,465 | ||||||||||||||
Vesting of restricted stock units | 0 | ||||||||||||||
Vesting of ESPP Shares (in shares) | 50,818 | ||||||||||||||
Vesting of ESPP Shares | 1,183 | 1,183 | |||||||||||||
Stock-based compensation | 5,751 | 5,751 | |||||||||||||
Net loss | (90,935) | (90,935) | |||||||||||||
Ending balance (in shares) at Mar. 31, 2021 | 26,182,719 | ||||||||||||||
Ending balance at Mar. 31, 2021 | $ (269,394) | $ 26 | $ 713,782 | $ (928,204) | $ 0 | $ (54,998) |
Condensed Statements of Cash Fl
Condensed Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Operating activities | ||
Net loss | $ (90,935) | $ (78,249) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation expense | 153 | 106 |
Accretion of premiums and discounts on investments | 0 | (73) |
Amortization of debt issuance costs | 400 | 0 |
Non-cash interest expense related to the revenue interest liability | 4,925 | 4,171 |
Stock-based compensation expense | 5,751 | 7,053 |
Changes in assets and liabilities: | ||
Prepaids and other assets | (9,808) | (2,538) |
Deferred revenue | 881 | (982) |
Inventories | (3,894) | (1,841) |
Accounts payable | (21,583) | (13,650) |
Other accrued liabilities | 25,042 | 16,656 |
Net cash used in operating activities | (89,068) | (69,347) |
Investing activities | ||
Purchases of investments | 0 | (4,420) |
Proceeds from sales/maturities of investments | 0 | 31,200 |
Purchase of property and equipment | 0 | (191) |
Net cash provided by investing activities | 0 | 26,589 |
Financing activities | ||
Proceeds from revenue interest liability | 0 | 25,000 |
Proceeds from exercise of common stock options | 2,668 | 1,014 |
Payments on revenue interest liability | (573) | 0 |
Payment of debt issuance costs | (50) | 0 |
Net cash provided by financing activities | 2,045 | 26,014 |
Net decrease in cash and cash equivalents | (87,023) | (16,744) |
Cash, cash equivalents and restricted cash at beginning of period | 304,962 | 167,058 |
Cash, cash equivalents and restricted cash at end of period | 217,939 | 150,314 |
Supplemental disclosure of cash flow information: | ||
Purchase of property and equipment not yet paid | 0 | 408 |
Non cash right of use asset | 4 | 91 |
Debt issuance costs not yet paid | $ 445 | $ 0 |
The Company and Basis of Presen
The Company and Basis of Presentation | 3 Months Ended |
Mar. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
The Company and Basis of Presentation | The Company and Basis of Presentation Esperion Therapeutics, Inc. ("the Company”) is the Lipid Management Company, a pharmaceutical company singularly focused on developing and commercializing affordable, oral, once-daily, non-statin medicines for the treatment of patients struggling with elevated low density lipoprotein cholesterol ("LDL-C"). The Esperion team of lipid experts are dedicated to lowering bad cholesterol through the discovery, development and commercialization of innovative medicines and their combinations with established medicines. The Company's first two products were approved by the U.S. Food and Drug Administration ("FDA"), European Medicines Agency ("EMA") and Swiss Agency for Therapeutic Products ("Swissmedic") in 2020. Bempedoic acid and the bempedoic acid / ezetimibe combination tablets are oral, once-daily, non-statin, LDL-C lowering medicines for patients with atherosclerotic cardiovascular disease ("ASCVD") or heterozygous familial hypercholesterolemia ("HeFH"). On April 26, 2021, the Company entered into a license and collaboration agreement with Daiichi Sankyo Co. Ltd ("DS"). Pursuant to the agreement, the Company granted DS exclusive development and commercialization rights to bempedoic acid and the bempedoic acid / ezetimibe combination tablet in South Korea, Taiwan, Hong Kong, Thailand, Vietnam, Brazil, Macao, Cambodia and Myanmar (collectively the "DS Territory"). The agreement allows for potential expansion across geographies including Saudi Arabia, Kuwait, Oman, UAE, Qatar, Bahrain, Yemen, and other Latin American countries. DS will be responsible for commercialization in these territories, while Esperion remains responsible for certain development and regulatory activities in South Korea and Taiwan. The Company will receive an upfront cash payment of $30.0 million in May 2021 and is eligible to receive up to an additional $175.0 million in sales milestones. The Company will also receive tiered royalties ranging from 5 percent to 20 percent on net sales in the DS Territory. On April 26, 2021, the Company entered into Amendment No. 2 (the “RIPA Amendment”) to the Revenue Interest Purchase Agreement ("RIPA') with Eiger III SA LLC (“Oberland”), an affiliate of Oberland Capital LLC, as agent for the purchaser parties thereto dated as of June 26, 2019 (as amended by the Amendment No. 1 dated as of November 9, 2020, the “RIPA”). Pursuant to the RIPA Amendment, Oberland Capital waived the original trailing six-month world-wide net sales condition to the third installment payment under the RIPA and released the final $50 million payment payable to the Company under the terms of the RIPA. The Company and Oberland also agreed to amend additional terms of the RIPA, which are discussed further in Note 15 Subsequent Events. The Company's primary activities since incorporation have been conducting research and development activities, including nonclinical, preclinical and clinical testing, performing business and financial planning, recruiting personnel, and raising capital. The Company received approval by the FDA in February 2020 to commercialize NEXLETOL ® and NEXLIZET ® in the U.S., and accordingly commenced principal operations on March 30, 2020 with the commercialization of NEXLETOL. The Company is subject to risks and uncertainties which include the need to successfully commercialize its products, research, develop, and clinically test therapeutic products; obtain regulatory approvals for its products; expand its management, commercial and scientific staff; and finance its operations with an ultimate goal of achieving profitable operations. The Company has sustained annual operating losses since inception and expects such losses to continue over the foreseeable future. While management believes current cash resources and future cash received from the Company's net product sales, collaboration agreements with Daiichi Sankyo Europe GmbH ("DSE"), Otsuka Pharmaceutical Co., Ltd. ("Otsuka"), and DS entered into on January 2, 2019, April 17, 2020, and April 26, 2021, respectively, and from the RIPA, will fund operations for the foreseeable future, management may continue to fund operations and advance the development of the Company's products and product candidates through a combination of collaborations with third parties, strategic alliances, licensing arrangements, permitted debt financings, permitted royalty-based financings, and permitted private and public equity offerings or through other sources. The impact of COVID-19 and the uncertainty around the global pandemic could further impact the commercial launch of NEXLETOL and NEXLIZET and the Company’s research and development programs and could result in lower cash flows or higher costs that could further impact the Company’s overall operations and cash needs in the future. If adequate funds are not available, the Company may not be able to continue the development of its current products or future product candidates, or to commercialize its current or future product candidates, if approved. Basis of Presentation The accompanying condensed interim financial statements are unaudited and were prepared by the Company in accordance with generally accepted accounting principles in the United States of America (“GAAP”). In the opinion of management, the |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Use of Estimates The preparation of financial statements in accordance with generally accepted accounting principles in the United States requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, net revenues, expenses and related disclosures. Actual results could differ from those estimates. Concentration of Risk The Company enters into a limited number of distribution agreements with distributors and specialty pharmacies. The Company's net product sales are with these customers. As of March 31, 2021 and December 31, 2020, eight customers accounted for all of the Company's net trade receivables. Revenue Recognition In accordance with ASC 606, Revenue from Contracts with Customers, the Company recognizes revenue when a customer obtains control of promised goods or services, in an amount that reflects the consideration the Company expects to receive in exchange for the goods or services provided. To determine revenue recognition for arrangements within the scope of ASC 606, the Company performs the following five steps: identify the contracts with a customer; identify the performance obligations in the contract; determine the transaction price; allocate the transaction price to the performance obligations in the contract; and recognize revenue when or as the entity satisfies a performance obligation. At contract inception the Company assesses the goods or services promised within each contract and determines those that are performance obligations and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when or as the performance obligation is satisfied. The Company derives revenue through two primary sources: collaboration revenue and product sales. Collaboration revenue consists of the collaboration payments to the Company for collaboration arrangements outside of the United States for the development, manufacturing and commercialization of the Company's product candidates by the Company's partners and product sales consists of sales of NEXLETOL and NEXLIZET. a. Collaboration Revenue The Company has entered into agreements related to its activities to develop, manufacture, and commercialize its product candidates. The Company earns collaboration revenue in connection with a collaboration agreement to develop and/or commercialize product candidates where the Company deems the collaborator to be the customer. Revenue is recognized when (or as) the Company satisfies performance obligations under the terms of a contract. Depending on the terms of the arrangement, the Company may defer the recognition of all or a portion of the consideration received as the performance obligations are satisfied. The collaboration agreements may require the Company to deliver various rights, services, and/or goods across the entire life cycle of a product or product candidate. In an agreement involving multiple goods or services promised to be transferred to a customer, the Company must assess, at the inception of the contract, whether each promise represents a separate performance obligation (i.e., is "distinct"), or whether such promises should be combined as a single performance obligation. The terms of the agreement typically include consideration to be provided to the Company in the form of non-refundable up-front payments, development milestones, sales milestones, and royalties on sales of products within a respective territory. The Company recognizes regulatory and approval milestones consideration when it is probable that a future reversal is unlikely to occur. For sales based milestones and royalties based on sales of product in a territory, the Company applies the sales-based royalty exception in ASC 606-10-55-65 to all of these milestones and royalties. At the inception of the contract, the transaction price reflects the amount of consideration the Company expects to be entitled to in exchange for transferring promised goods or services to its customer. In the arrangement where the Company satisfies performance obligation(s) during the regulatory phase over time, the Company recognizes collaboration revenue typically using an input method on the basis of regulatory costs incurred relative to the total expected cost which determines the extent of progress toward completion. The Company reviews the estimate of the transaction price and the total expected cost each period and makes revisions to such estimates as necessary. Under contracted supply agreements with collaborators, the Company may manufacture and supply quantities of active pharmaceutical ingredient (“API”) or bulk tablets reasonably required by collaboration partners for the development or sale of licensed products in their respective territory. The Company recognizes revenue when the collaboration partner has obtained control of the API or bulk tablets. The Company records the costs related to the supply agreement in cost of goods sold on the condensed statements of operations and comprehensive income (loss). Under the Company's collaboration agreements, product sales and cost of sales may be recorded by the Company's collaborators as they are deemed to be the principal in the transaction. The Company receives royalties from the commercialization of such products, and records its share of the variable consideration, representing a percentage of net product sales, as collaboration revenue in the period in which such underlying sales occur and costs are incurred by the collaborator. The collaborator will provide the Company with estimates of its royalties for such quarter; these estimates are reconciled to actual results in the subsequent quarter, and the royalty is adjusted accordingly, as necessary. b. Product Sales, Net On February 21, 2020, the Company announced that the FDA approved NEXLETOL as an adjunct to diet and maximally tolerated statin therapy for the treatment of adults with HeFH or established ASCVD who require additional lowering of LDL-C. On February 26, 2020, the Company announced that the FDA approved NEXLIZET as an adjunct to diet and maximally tolerated statin therapy for the treatment of adults with HeFH or established ASCVD who require additional lowering of LDL-C. On March 30, 2020, NEXLETOL was commercially available in the U.S. through prescription and on June 4, 2020, NEXLIZET was commercially available in the U.S. through prescription. Net product sales totaled $6.4 million and $0.9 million for the three months ended March 31, 2021 and 2020, respectively. The Company sells NEXLETOL and NEXLIZET to wholesalers in the U.S and, in accordance with ASC 606, recognizes revenue at the point in time when the customer is deemed to have obtained control of the product. The customer is deemed to have obtained control of the product at the time of physical receipt of the product at the customers’ distribution facilities, or free on board (“FOB”) destination, the terms of which are designated in the contract. Product sales are recorded at the net selling price, which includes estimates of variable consideration for which reserves are established for (a) rebates and chargebacks, (b) co-pay assistance programs, (c) distribution fees, (d) product returns, and (e) other discounts. Where appropriate, these estimates take into consideration a range of possible outcomes which are probability-weighted for relevant factors such as current contractual and statutory requirements, and forecasted customer buying and payment patterns. Overall, these reserves reflect the Company's best estimates of the amount of consideration to which it is entitled based on the terms of the applicable contract. The amount of variable consideration may be constrained and is included in the net sales price only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period. Given the early stage of the Company’s commercial operations it has provided constraint of its variable consideration due to its potential consumption trends. Actual amounts of consideration ultimately received may differ from the Company's estimates. If actual results in the future vary from estimates, the Company adjusts these estimates, which would affect net product revenue and earnings in the period such variances become known. Liabilities for co-pay assistance, expected product returns, rebates, and distributor fees are classified as “Other accrued liabilities” in the condensed balance sheets. Discounts, such as prompt pay discounts, and chargebacks are recorded as a reduction to trade accounts receivable, which is included in “Other prepaid and current assets” in the condensed balance sheets. Forms of Variable Consideration Rebates and Chargebacks: The Company estimates reductions to product sales for Public Health Service Institutions, such as Medicaid, Medicare and Veterans' Administration ("VA") programs, as well as certain other qualifying federal and state government programs, and other group purchasing organizations. The Company estimates these reductions based upon the Company's contracts with government agencies and other organizations, statutorily defined discounts and estimated payor mix. These organizations purchase directly from the Company's wholesalers at a discount and the wholesalers charge the Company back the difference between the wholesaler price and the discounted price. The Company's liability for Medicaid rebates consists of estimates for claims that a state will make for a current quarter. The Company's reserve for this discounted pricing is based on expected sales to qualified healthcare providers and the chargebacks that customers have already claimed. Co-pay assistance: Eligible patients who have commercial insurance may receive assistance from the Company to reduce the patient's out of pocket costs. The Company will buy down the difference between the amount of the eligible patient's co-pay when the drug is purchased at the pharmacy at a determined price. Liabilities for co-pay assistance are calculated by actual program participation from third-party administrators. Distribution Fees: The Company has written contracts with its customers that include terms for distribution fees and costs for inventory management. The Company estimates and records distribution fees due to its customers based on gross sales. Product Returns: The Company generally offers a right of return based on the product’s expiration date and certain spoilage and damaged instances. The Company estimates the amount of product sales that may be returned and records the estimate as a reduction of product sales in the period the related product sales is recognized. The Company’s estimates for expected returns are based primarily on an ongoing analysis of sales information and visibility into the inventory remaining in the distribution channel. Discounts: The Company provides product discounts, such as prompt pay discounts, to its customers. The Company estimates cash discounts based on terms in negotiated contracts and the Company’s expectations regarding future payment patterns. Inventories Inventories are stated at the lower of cost or net realizable value and recognized on a first-in, first-out ("FIFO") method. The Company uses standard cost to determine the cost basis for inventory. Inventory is capitalized based on when future economic benefit is expected to be realized. The Company began capitalizing inventory upon receiving FDA approval for NEXLETOL and NEXLIZET on February 21, 2020 and February 26, 2020, respectively. Prior to the FDA approval of NEXLETOL and NEXLIZET, expenses associated with the manufacturing of the Company's products were recorded as research and development expense. The Company analyzes its inventory levels on a periodic basis to determine if any inventory is at risk for expiration prior to sale or has a cost basis that is greater than its estimated future net realizable value. Any adjustments are recognized through cost of goods sold in the period in which they are incurred. Recently Implemented Accounting Pronouncements In August 2020, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”). This ASU simplifies the accounting for convertible instruments by removing the separation models for convertible debt with cash conversion features and convertible instruments with a beneficial conversion feature, which requires the fair value of the embedded conversion feature of convertible instruments be allocated to equity. Under ASU 2020-06, a convertible debt instrument with those features will generally be reported as a single liability at its amortized cost with no separate accounting for the embedded conversion features in equity. The adoption of this ASU resulted in the reclassification of the portion of the Company's convertible notes from equity to debt, which also reduces reported interest expense and increases reported net income. ASU 2020-06 requires the application of the if-converted method when calculating diluted earnings per share, eliminating the Company’s ability to use the treasury stock method when certain conditions are met. The ASU is effective for annual reporting periods beginning after December 15, 2021, with early adoption permitted no earlier than fiscal years beginning after December 15, 2020. The Company early adopted this standard as of January 1, 2021 which resulted in a net increase in the convertible notes of approximately $92.0 million, an adjustment to accumulated deficit of $1.5 million, and a reduction to additional paid-in capital of $93.5 million. The tax impact of the adoption was not material. There have been no other material changes to the significant accounting policies previously disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020. |
Collaborations with Third Parti
Collaborations with Third Parties | 3 Months Ended |
Mar. 31, 2021 | |
Collaborations with Third Parties | |
Collaborations with Third Parties | Collaborations with Third Parties DSE Agreement Terms On January 2, 2019, the Company entered into a license and collaboration agreement with DSE. Pursuant to the agreement, the Company granted DSE exclusive commercialization rights to bempedoic acid and the bempedoic acid / ezetimibe combination tablets in the European Economic Area and Switzerland (“DSE Territory”). DSE will be responsible for commercialization in the DSE Territory. The Company remains responsible for clinical development, regulatory and manufacturing activities for the licensed products globally, including in the DSE Territory. Pursuant to the agreement, the consideration consists of a $150.0 million upfront cash payment as well as $150.0 million cash payment to the Company upon first commercial sales in the DSE Territory. The Company also is responsible to supply DSE with certain manufacturing supply of the API or bulk tablets. The Company is also eligible to receive a substantial additional regulatory milestone payment upon the grant of the marketing authorisation in the European Union for the CV risk reduction label, depending on the range of relative risk reduction in the CLEAR Outcomes study. In addition, the Company is eligible to receive additional sales milestone payments related to total net sales achievements for DSE in the DSE Territory. Finally, the Company will receive tiered fifteen percent (15%) to twenty-five percent (25%) royalties on net DSE Territory sales. The agreement calls for both parties to participate in a Joint Collaboration Committee (the “DSE JCC”). The DSE JCC is comprised of executive management from each company and the Company will lead in all aspects related to development and DSE will lead in all aspects related to commercialization in the DSE Territory. Agreement Terms Amendment On June 18, 2020, the Company entered into an amendment to the license and collaboration agreement with DSE, dated as of January 2, 2019. In June 2020, the Company completed the transfer of the MAAs for NILEMDO ® and NUSTENDI ® . Pursuant to the terms of the amendment, DSE paid the Company the second $150.0 million milestone based on completion of the NUSTENDI MAA transfer rather than the first product sale in the EU, as previously agreed. Additionally, the Company and DSE have agreed to expand the DSE Territory, or the territory in which DSE has exclusive commercialization rights to NILEMDO and NUSTENDI to include Turkey. DSE's designated affiliate in Turkey will be solely responsible, at its sole cost and expense, for all regulatory matters relating to such products in Turkey, including obtaining regulatory approval for such products in Turkey. Collaboration Revenue The Company considered the guidance under ASC 606 and concluded that the agreement was in the scope of ASC 606. The Company concluded that the upfront payment of $150.0 million should be included in the transaction price and related to the following performance obligations under the agreement: 1) the license to the Company’s intellectual property and 2) the obligation to provide ongoing regulatory and development activities. The Company used the adjusted market assessment approach in determining the standalone selling price of the Company’s intellectual property and the expected cost plus margin approach in determining the standalone selling price of the Company’s obligation to provide ongoing regulatory and development activities. In the three months ended March 31, 2020, the Company recognized $1.0 million related to the on-going performance obligation for the ongoing regulatory efforts related to the MAA in the DSE Territory. In the three months ended March 31, 2021, the Company recognized collaboration revenue of $1.6 million related to both royalty revenue from DSE following their European launch of NILEMDO and NUSTENDI as well as the sales of bulk tablets to DSE pursuant to the supply agreement that was executed with DSE. All remaining future potential milestone amounts were not included in the transaction price, as they were all determined to be fully constrained following the concepts of ASC 606 due to the fact that such amounts hinge on development activities, regulatory approvals and sales-based milestones. Additionally, the Company expects that any consideration related to sales-based milestones will be recognized when the subsequent sales occur. Otsuka Agreement Terms On April 17, 2020, the Company entered into the Otsuka Agreement with Otsuka. Pursuant to the Otsuka Agreement, the Company granted Otsuka exclusive development and commercialization rights to NEXLETOL and NEXLIZET in Japan. Otsuka will be responsible for all development, regulatory, and commercialization activities in Japan. In addition, Otsuka will fund all clinical development costs associated with the program in Japan. Pursuant to the agreement, the consideration consists of a $60.0 million upfront cash payment and the Company will be eligible to receive additional payments of up to $450.0 million if certain regulatory and commercial milestones are achieved by Otsuka. The potential future milestone payments include up to $20.0 million upon first JNDA submissions in the Otsuka Territory, up to $70.0 million upon the first NHI Price Listing for NEXLETOL in the Otsuka Territory, and up to $50.0 million upon the achievement of the primary major adverse cardiovascular events (“MACE”) in the CLEAR Outcomes study and the CV risk reduction rate on the U.S. label, depending on the range of relative risk reduction in the CLEAR Outcomes study. In addition, the Company is eligible to receive additional sales milestone payments up to $310.0 million related to total net sales achievements for Otsuka in Japan. Finally, the Company will receive tiered fifteen percent (15%) to thirty percent (30%) royalties on net sales in Japan. The agreement calls for both parties to participate in a Joint Collaboration Committee (the "Otsuka JCC"). The Otsuka JCC is comprised of executive management from each company and Otsuka will lead in all aspects related to development and commercialization in the Otsuka Territory. Collaboration Revenue The Company considered the guidance under ASC 606 and concluded that the agreement was in the scope of ASC 606. The Company did not have any collaboration revenue from the Otsuka Agreement during the three months ended March 31, 2021 and 2020. All future potential milestone amounts were not included in the transaction price, as they were all determined to be fully constrained following the concepts of ASC 606 due to the fact that such amounts hinge on development activities, regulatory approvals and sales-based milestones. Additionally, the Company expects that any consideration related to royalties and sales-based milestones will be recognized when the subsequent sales occur. The Company has not yet recognized any revenue for milestone payments as the related regulatory and commercial milestones have not yet been achieved. Other Agreements During December 2020, the Company entered into a licensing agreement with Serometrix to in-license a series of early stage compounds known as scaffolds related to its oral, small molecule PCSK9 inhibitor program. PCSK9 is an enzyme responsible for regulating LDL receptors. PCSK9 inhibitors stop LDL receptors from being broken down, increasing the number of LDL receptors present to remove cholesterol from the blood. The agreement allows the Company use of the PCSK9 compounds, which were patented by Serometrix prior to the licensing agreement, to perform further research and development with the goal of developing a small molecule oral PCSK9 inhibitor that can be taken as a tablet. In exchange for these rights, the Company agreed to pay Serometrix an upfront payment, milestone payments and royalties on net sales of licensed products under the agreement. The Company is obligated to make milestone payments to Serometrix upon the achievement of specified development, regulatory and commercialization milestones. The development milestone payments due under the agreement depend on the licensed product being developed. As part of the agreement, the Company made an upfront cash payment of $12.5 million in December 2020, which was recorded to research and development expense, to Serometrix, with payments in future years tied to specific milestones. The Company has also agreed to pay tiered royalties based on net sales of all products licensed under the agreement of mid-single-digit to low double-digit percentages. |
Inventories
Inventories | 3 Months Ended |
Mar. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories consist of the following (in thousands): March 31, 2021 December 31, 2020 Raw materials $ 17,505 $ 13,788 Work in process 2,078 2,028 Finished goods 447 320 $ 20,030 $ 16,136 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies On January 12, 2016, a purported stockholder of the Company filed a putative class action lawsuit in the United States District Court for the Eastern District of Michigan, against the Company and Tim Mayleben, captioned Kevin L. Dougherty v. Esperion Therapeutics, Inc., et al. (No. 16-cv-10089). The lawsuit alleges that the Company and Mr. Mayleben violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and SEC Rule 10b-5 by allegedly failing to disclose in an August 17, 2015, public statement that the FDA would require a cardiovascular outcomes trial before approving the Company’s lead product candidate. The lawsuit seeks, among other things, compensatory damages in connection with an allegedly inflated stock price between August 18, 2015, and September 28, 2015, as well as attorneys’ fees and costs. On May 20, 2016, an amended complaint was filed in the lawsuit and on July 5, 2016, the Company filed a motion to dismiss the amended complaint. On December 27, 2016, the court granted the Company’s motion to dismiss with prejudice and entered judgment in the Company’s favor. On January 24, 2017, the plaintiffs in this lawsuit filed a motion to alter or amend the judgment. In May 2017, the court denied the plaintiff’s motion to alter or amend the judgment. In May 2017, the court denied the plaintiff’s motion to alter or amend the judgment. On June 19, 2017, the plaintiffs filed a notice of appeal to the Sixth Circuit Court of Appeals and on September 14, 2017, they filed their opening brief in support of the appeal. The appeal was fully briefed on December 7, 2017, and it was argued before the Sixth Circuit on March 15, 2018. On September 27, 2018, the Sixth Circuit issued an opinion in which it reversed the district court’s dismissal and remanded for further proceedings. On October 11, 2018, the Company filed a petition for rehearing en banc and, on October 23, 2018, the Sixth Circuit Court of Appeals directed plaintiffs to respond to that petition. On December 3, 2018, the Sixth Circuit denied the Company’s petition for en banc rehearing, and on December 11, 2018, the case was returned to the federal district court by mandate from the Sixth Circuit. On December 26, 2018, the Company filed an answer to the amended complaint, and on March 28, 2019, the Company filed its amended answer to the amended complaint. On September 15, 2020, the Company filed a motion for summary judgment, and the plaintiffs filed a motion for partial summary judgment, and on October 23, 2020, the parties filed oppositions to both motions for summary judgment. On November 20, 2020, the Company and plaintiffs filed replies in support of their respective motions. On March 12, 2021, the parties agreed to a settlement in principle of the securities class action, and on April 26, 2021, the parties entered into a stipulation of settlement to resolve all legal claims, in which defendants expressly deny that they have committed any act or omission giving rise to any liability under Section 10(b) of the Securities Exchange Act of 1934. Under the terms of the stipulation of settlement, subject to approval by the court, the Company and certain of the Company's insurance carriers will cause a payment of $18.25 million to be made to the plaintiff class. There is no assurance that the settlement will ultimately be approved or that it will become final. If the settlement does not occur and litigation continues, the Company intends to vigorously defend against it. As a result of this settlement agreement, the Company has recorded a litigation settlement liability of $18.25 million as of March 31, 2021 in other accrued liabilities on the condensed balance sheet, a litigation insurance settlement recovery receivable of $5.0 million, which represents the estimated insurance claim proceeds from our insurance carriers as of March 31, 2021, in other prepaid and current assets on the condensed balance sheet, and recorded a loss on settlement of $13.25 million in selling, general, and administrative expenses on the condensed statement of operations. On December 15, 2016, a purported stockholder of the Company filed a derivative lawsuit in the Court of Chancery of the State of Delaware against Tim Mayleben, Roger Newton, Mary McGowan, Nicole Vitullo, Dov Goldstein, Daniel Janney, Antonio Gotto Jr., Mark McGovern, Gilbert Omenn, Scott Braunstein, and Patrick Enright. The Company is named as a nominal defendant. The lawsuit alleges that the defendants breached their fiduciary duties to the Company when they made or approved improper statements on August 17, 2015, regarding the Company’s lead product candidate’s path to FDA approval, and failed to ensure that reliable systems of internal controls were in place at the Company. On February 8, 2019, the Company and defendants filed a motion to dismiss the derivative lawsuit. On April 23, 2019, the plaintiff filed an opposition to the motion to dismiss the derivative lawsuit, and the Company filed a reply brief on May 15, 2019. On November 6, 2019, the court held a hearing on the motion to dismiss. On February 13, 2020, the court granted the motion to dismiss with prejudice and entered judgment in the Company’s favor. On March 16, 2020, the plaintiff filed a notice of appeal to the Supreme Court of Delaware. On June 1, 2020, the plaintiff filed his opening brief on appeal to the Supreme Court of Delaware. On July 1, 2020, the Company and the defendants filed an answering brief, and on July 16, 2020, the plaintiff filed a reply brief. On October 14, 2020, the Supreme Court of Delaware held oral arguments on the appeal. On October 29, 2020, the Supreme Court of Delaware issued an order affirming the judgment of the Court of Chancery. There have been no other material changes to the Company’s contractual obligations and commitments and contingencies outside the ordinary course of business from those previously disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020 or noted above. |
Investments
Investments | 3 Months Ended |
Mar. 31, 2021 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | Investments The following table summarizes the Company’s cash equivalents and short-term investments (in thousands): March 31, 2021 Amortized Gross Unrealized Gains Gross Unrealized Losses Estimated Cash equivalents: Money market funds $ 206,804 $ — $ — $ 206,804 Total $ 206,804 $ — $ — $ 206,804 December 31, 2020 Amortized Gross Unrealized Gains Gross Unrealized Losses Estimated Cash equivalents: Money market funds $ 281,783 $ — $ — $ 281,783 Total $ 281,783 $ — $ — $ 281,783 During the three months ended March 31, 2021 and 2020, other income, net in the statements of operations includes interest income on investments of less than $0.1 million and $0.4 million, respectively. There were no unrealized gains or losses on investments reclassified from accumulated other comprehensive income (loss) to other income in the statements of operations during the three months ended March 31, 2021 and 2020. In the three months ended March 31, 2021 and 2020, there were no allowances for credit losses and all unrealized gains (losses) for available-for-sale securities were recognized in accumulated other comprehensive income (loss). As of March 31, 2021 and December 31, 2020, the Company had no accrued interest receivables. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The Company follows accounting guidance that emphasizes that fair value is a market-based measurement, not an entity-specific measurement. Fair value is defined as “the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.” Fair value measurements are defined on a three level hierarchy: Level 1 inputs: Quoted prices for identical assets or liabilities in active markets; Level 2 inputs: Observable inputs other than Level 1 prices, such as quoted market prices for similar assets or liabilities or other inputs that are observable or can be corroborated by market data; and Level 3 inputs: Unobservable inputs that are supported by little or no market activity and require the reporting entity to develop assumptions that market participants would use when pricing the asset or liability. The following table presents the Company’s financial assets that have been measured at fair value on a recurring basis (in thousands): Description Total Level 1 Level 2 Level 3 March 31, 2021 Assets: Money market funds $ 206,804 $ 206,804 $ — $ — Total assets at fair value $ 206,804 $ 206,804 $ — $ — December 31, 2020 Assets: Money market funds $ 281,783 $ 281,783 $ — $ — Total assets at fair value $ 281,783 $ 281,783 $ — $ — There were no transfers between Levels 1, 2 or 3 during the three months ended March 31, 2021 and 2020. |
Liability Related to the Revenu
Liability Related to the Revenue Interest Purchase Agreement | 3 Months Ended |
Mar. 31, 2021 | |
Liability Related to the Revenue Interest Purchase Agreement | |
Liability Related to the Revenue Interest Purchase Agreement | Liability Related to the Revenue Interest Purchase Agreement On June 26, 2019, the Company entered into a RIPA with Oberland, as agent for purchasers party thereto (the “Purchasers”), and the Purchasers named therein, to obtain financing in respect to the commercialization and further development of bempedoic acid and the bempedoic acid / ezetimibe combination tablets and other working capital needs. Pursuant to the RIPA, the Company received $125.0 million at closing, less certain issuance costs. The Company is also entitled to receive up to approximately $75.0 million in subsequent installments subject to the terms and conditions set forth in the RIPA: (i) $25.0 million upon certain regulatory approval of its product candidates and (ii) $50.0 million, at the Company’s option, upon reaching $100.0 million trailing worldwide six-month net sales any time prior to December 31, 2021 (the “Third Payment”). In March 2020, the Company received $25.0 million from Oberland upon receiving regulatory approval of NEXLETOL. As consideration for such payments, the Purchasers have a right to receive certain revenue interests (the “Revenue Interests”) from the Company based upon net sales of the Company’s certain products which will be tiered payments initially ranging from 2.5% to 7.5% of the Company’s net sales in the covered territory (the “Covered Territory”); provided that (a) if annual net sales equal or exceed $350.0 million by December 31, 2021 (the “Sales Threshold”), the initially tiered revenue interest rate will be decreased to a single rate of 2.5% of the Company’s net sales in the Covered Territory, beginning on January 1, 2022, and (b) if annual net sales equal or exceed the Sales Threshold and if the Purchasers receive 100% of their invested capital by December 31, 2024, the revenue interest rate will be decreased to a single rate of 0.4% of the Company’s net sales in the Covered Territory beginning on January 1, 2025. If the Third Payment is drawn down by the Company, the applicable royalty rates will increase by one-third. The Covered Territory is the United States, but is subject to expand to include the world-wide net sales if the Company’s annual U.S. net sales are less than $350.0 million for the year ended December 31, 2021. The U.S. net sales milestone thresholds are not to be taken as financial guidance. The Purchasers’ rights to receive the Revenue Interests shall terminate on the date on which the Purchasers have received Revenue Interests payments of 195% of the then aggregate purchase price (the “Cumulative Purchaser Payments”) paid to the Company, unless the RIPA is terminated earlier. Under the RIPA, the Company has an option (the “Call Option”) to terminate the RIPA and repurchase future Revenue Interests at any time upon advance written notice. Additionally, the Purchasers have an option (the “Put Option”) to terminate the RIPA and to require the Company to repurchase future Revenue Interests upon enumerated events such as a bankruptcy event, an uncured material breach, a material adverse effect or a change of control. If the Put Option is exercised prior to the first anniversary of the closing date by the Purchasers (except pursuant to a change of control), the required repurchase price will be 120% of the Cumulative Purchaser Payments (minus all payments Company has made to the Purchasers in connection with the Revenue Interests). In all other cases, if the Put Option or the Call Option are exercised, the required repurchase price will be 175% of the Cumulative Purchaser Payments (minus all payments Company has made to the Purchasers in connection with the Revenue Interests), if such option is exercised prior to the third anniversary of the closing date, and 195% of the Cumulative Purchaser Payments (minus all payments Company has made to the Purchasers in connection with the Revenue Interests), if such option is exercised thereafter. In addition, the RIPA contains various representations and warranties, information rights, non-financial covenants, indemnification obligations and other provisions that are customary for a transaction of this nature. In connection with the arrangement, as of March 31, 2021, the Company has recorded a liability, referred to as the “Revenue interest liability” in the condensed balance sheets, of $181.0 million, net of $0.5 million of capitalized issuance costs in connection with the RIPA. The Company imputes interest expense associated with this liability using the effective interest rate method. The effective interest rate is calculated based on the rate that would enable the debt to be repaid in full over the anticipated life of the arrangement. The interest rate on this liability may vary during the term of the agreement depending on a number of factors, including the level of forecasted net sales. The Company evaluates the interest rate quarterly based on its current net sales forecasts utilizing the prospective method. A significant increase or decrease in net sales will materially impact the revenue interest liability, interest expense and the time period for repayment. The Company recorded approximately $4.9 million and $4.2 million in interest expense related to this arrangement for the three months ended March 31, 2021 and 2020, respectively. The repayment of the RIPA to Oberland does not have a fixed repayment schedule, rather it will be completely repaid and extinguished when the Company has repaid 195% of the aggregate purchase price unless the RIPA is terminated earlier. Since there is not a fixed repayment schedule, the Company does not project its future repayments by year. Each period, the Company estimates the future expected sales of its products in the covered territory and determines the effective annual imputed interest rate, which updates and changes the timing of the Company’s payments. Under the terms of the agreement, every $100 million of net sales generated, less than or equal to $250 million in an annual aggregate year, would result in a repayment obligation of approximately $7.5 million or 7.5% at the stated repayment rate in the first year. Annual Net Sales for a calendar year exceeding $250 million would result in a repayment obligation of approximately $2.5 million or 2.5% for every $100 million of sales above the threshold. If the Company equals or exceeds $350 million of sales in the U.S. in 2021, then the repayment amount would drop to $2.5 million for every $100 million of net sales starting in 2022. If the US net sales are less than $350 million for the year ended December 31, 2021, then the Covered Territory is expanded to include worldwide sales beginning in 2022. The Company’s repayments of the RIPA are directly tied to the growth of its net sales, and as the Company’s net sales grow, the Company expects the related repayments of the RIPA to grow as well. The Company currently expects to repay $6.4 million in the next twelve months. The effective annual imputed interest rate is 11.8% as of March 31, 2021. The Company incurred $0.6 million of issuance costs in connection with the RIPA, which will be amortized to interest expense over the estimated term of the RIPA. Payments made to Oberland as a result of the Company’s net sales will reduce the revenue interest liability. The following table summarizes the revenue interest liability activity during the three months ended March 31, 2021: (in thousands) Total revenue interest liability at December 31, 2020 $ 176,604 Interest expense recognized 4,925 Revenue Interests payments (573) Total revenue interest liability at March 31, 2021 $ 180,956 |
Convertible Notes
Convertible Notes | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Convertible Notes | Convertible NotesOn November 16, 2020, the Company issued $250.0 million aggregate principal amount of 4.0% senior subordinated convertible notes due November 15, 2025. The net proceeds the Company received from the offering of the initial notes was approximately $242.0 million, after deducting the initial purchasers’ discounts and commissions and offering expenses payable by the Company. In connection with the offering of the senior subordinated convertible notes, the Company granted the initial purchasers of the senior subordinated convertible notes a 30-day option to purchase up to an additional $30.0 million aggregate principal amount of the senior subordinated convertible notes on the same terms and conditions. On November 18, 2020 the option was exercised, which resulted in approximately $29.1 million of additional proceeds, for total aggregate principal of $280.0 million and net proceeds of $271.1 million (the additional notes and, together with the initial notes, collectively called the “Convertible Notes”). The Company used approximately $46.0 million of the net proceeds from the offering of the notes to pay the cost of the Capped Call (as defined below) and $55.0 million of the net proceeds from the offering of the initial notes to finance the Prepaid Forward (as defined below). The Convertible Notes are the Company's senior unsecured obligations and mature on November 15, 2025 (the “Maturity Date”), unless earlier repurchased or converted into shares of common stock under certain circumstances described below. The Convertible Notes are convertible into shares of the Company’s common stock, can be repurchased for cash, or a combination thereof, at the Company’s election, at an initial conversion rate of 30.2151 shares of common stock per $1,000 principal amount of the Convertible Notes, which is equivalent to an initial conversion price of approximately $33.096 per share of common stock, subject to adjustment. The Company will pay interest on the Convertible Notes semi-annually in arrears on May 15 and November 15 of each year. The Convertible Notes are general unsecured obligations of the Company that are subordinated in right of payment to indebtedness, obligations and other liabilities under the Company’s RIPA, the revenue interests issued pursuant to such agreement, and any refinancing of the foregoing. Holders may convert their Convertible Notes at their option at any time prior to the close of business on the business day immediately preceding August 15, 2025 in the following circumstances: (1) during any calendar quarter commencing after the calendar quarter ending on March 31, 2021 (and only during such calendar quarter), if the last reported sale price per share of the Company’s common stock, par value $0.001 per share (“common stock”), is greater than or equal to 130% of the conversion price for each of at least 20 trading days, whether or not consecutive, during the 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter; (2) during the five business days after any five consecutive trading day period (such five consecutive trading day period, the “measurement period”) in which the trading price per $1,000 principal amount of notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price per share of the Company’s common stock and the conversion rate for the notes on each such trading day; (3) if the Company calls such notes for redemption, any such notes that have been called for redemption may be converted at any time prior to the close of business on the second scheduled trading day immediately preceding the redemption date, but only with respect to the notes called for redemption; and (4) upon the occurrence of specified corporate events, as provided in the Indenture. On or after August 15, 2025, to the close of business on the second scheduled trading day immediately before the maturity date, holders may convert all or any portion of their notes at the applicable conversion rate at any time at the option of the holder regardless of the foregoing conditions. In addition, following certain corporate events or following issuance of a notice of redemption, the Company will, in certain circumstances, increase the conversion rate for a holder who elects to convert its notes in connection with such a corporate event or to convert its notes called (or deemed called) for redemption during the related redemption period, as the case may be. The Convertible Notes will be redeemable, in whole or in part, at the Company’s option at any time, and from time to time, on or after November 20, 2023 and before the 41st scheduled trading day immediately before the maturity date, at a cash redemption price equal to 100% of the principal amount of the notes to be redeemed, plus accrued and unpaid interest, if any, but only if the last reported sale price per share of the Company’s common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive), including the trading day immediately preceding the date the Company sends the related redemption notice, during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which the Company sends such redemption notice. No sinking fund is provided for the notes. If the Company redeems less than all the outstanding notes, at least $125.0 million aggregate principal amount of notes must be outstanding and not subject to redemption as of the relevant redemption notice date. If the Company undergoes a “fundamental change” (as defined in the Indenture), holders may require the Company to repurchase their notes for cash all or any portion of their notes at a fundamental change repurchase price equal to 100% of the principal amount of the notes to be repurchased, plus accrued and unpaid interest, to, but excluding, the fundamental change repurchase date. The Indenture includes customary terms and covenants, including certain events of default. The Company incurred approximately $8.9 million of issuance costs related to the issuance of the Convertible Notes, of which, prior to the adoption of ASU 2020-06 on January 1, 2021, $5.8 million and $3.1 million were allocated and recorded to long-term debt and additional paid-in capital, respectively. The $5.8 million of issuance costs recorded as long-term debt on the condensed balance sheet are amortized over the five-year contractual term of the Convertible Notes using the effective interest method. Prior to the adoption of ASU 2020-06 on January 1, 2021, the $271.1 million of proceeds received from the issuance of the Convertible Notes were allocated between long-term debt (the “liability component”) of $177.6 million and additional paid-in capital (the “equity component”) of $93.5 million. The fair value of the liability component was measured using rates determined for similar debt instruments without a conversion feature. The carrying amount of the equity component, representing the conversion option, was determined by deducting the fair value of the liability component from the aggregate face value of the Convertible Notes and was included in additional paid-in capital in the condensed balance sheet and was not remeasured as long as it did not to meet the conditions for equity classification. The liability component was to be accreted up to the face value of the Convertible Notes of $280.0 million, which resulted in additional non-cash interest expense being recognized through the Maturity Date. With the adoption of ASU 2020-06 as of January 1, 2021, the Company reports the convertible debt liability at the aggregate principal amount less unamortized issuance costs. This resulted in the reclassification of the $93.5 million of the Company’s convertible notes recognized at December 31, 2020 from additional paid in capital to the convertible debt liability. The portion of interest expense previously recognized for the accretion of the convertible debt liability and the true-up of the amortization of the issuance costs of $1.5 million was recorded as an adjustment to accumulated deficit. The following tables summarizes the outstanding principal and debt issuance cost balances as follows (in thousands): Convertible note, debt balance Debt issuance cost Convertible notes, net Balance at December 31, 2020 185,100 (5,733) 179,367 Adjustments to net principal due to adoption of ASU 2020-06 94,900 (2,973) 91,927 Balance at January 1, 2021 280,000 (8,706) 271,294 Balance at March 31, 2021 280,000 (8,306) 271,694 The Company recorded $3.2 million of interest expense during the three months ended March 31, 2021, relating to the cash interest on the convertible notes due semi-annually and amortization of the debt issuance costs. As of March 31, 2021, no Convertible Notes were convertible pursuant to their terms. The estimated fair value of the Convertible Notes was $295.1 million and $283.4 million and as of March 31, 2021 and December 31, 2020, respectively. The estimated fair value of the Convertible Notes was determined through consideration of quoted market prices. As of March 31, 2021 and December 31, 2020, the if-converted value of the Convertible Notes did not exceed the principal value of those notes. Capped Call Transactions In connection with the offering of the Convertible Notes, the Company entered into privately-negotiated capped call transactions with one of the initial purchasers of the convertible notes or its affiliate and certain other financial institutions. The Company used approximately $46.0 million of the net proceeds from the offering of the Convertible Notes to pay the cost of the capped call transactions. The capped call transactions are expected generally to reduce potential dilution to the Company’s common stock upon any conversion of the Convertible Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of converted notes, as the case may be, in the event that the market value per share of the Company’s common stock, as measured under the terms of the capped call transactions at the time of exercise, is greater than the strike price of the capped call transactions (which initially corresponds to the initial conversion price of the Convertible Notes, and is subject to certain adjustments), with such reduction and/or offset subject to a cap initially equal to approximately $55.16 (which represents a premium of approximately 100% over the last reported sale price of the Company’s common stock on November 11, 2020), subject to certain adjustments. The capped call transactions are separate transactions, entered into by the Company and are not part of the terms of the Convertible Notes. Given that the transactions meet certain accounting criteria, the convertible note capped call transactions are recorded in stockholders’ equity, and they are not accounted for as derivatives and are not remeasured each reporting period. As of March 31, 2021 and December 31, 2020, the Company had not purchased any shares under the convertible note capped call transactions. Prepaid Forward In connection with the offering of the Convertible Notes, the Company entered into a prepaid forward stock repurchase transaction (“Prepaid Forward”) with a financial institution (“Forward Counterparty”). Pursuant to the Prepaid Forward, the Company used approximately $55.0 million of the net proceeds from the offering of the Convertible Notes to fund the Prepaid Forward. The aggregate number of shares of the Company’s common stock underlying the Prepaid Forward was approximately 1,994,198. The expiration date for the Prepaid Forward is November 15, 2025, although it may be settled earlier in whole or in part. Upon settlement of the Prepaid Forward, at expiration or upon any early settlement, the Forward Counterparty will deliver to the Company the number of shares of common stock underlying the Prepaid Forward or the portion thereof being settled early. The shares purchased under the Prepaid Forward are treated as treasury stock and not outstanding for purposes of the |
Balance Sheet Disclosures
Balance Sheet Disclosures | 3 Months Ended |
Mar. 31, 2021 | |
Payables and Accruals [Abstract] | |
Balance Sheet Disclosures | Balance Sheet Disclosures Prepaid and other current assets consist of the following (in thousands): March 31, December 31, Accounts receivable $ 17,255 $ 12,388 Insurance receivable 5,000 — Prepaid inventory cost 7,603 5,957 Other prepaid and current assets 4,305 5,609 Total prepaid and other current assets $ 34,163 $ 23,954 Other accrued liabilities consist of the following (in thousands): March 31, December 31, Accrued legal settlement $ 18,250 $ — Accrued compensation 11,243 15,161 Accrued variable consideration 10,082 5,025 Accrued professional fees 4,845 3,183 Accrued interest on convertible notes 4,169 1,369 Accrued other 177 52 Total other accrued liabilities $ 48,766 $ 24,790 |
Stock Compensation
Stock Compensation | 3 Months Ended |
Mar. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Stock Compensation | Stock Compensation Employee Stock Purchase Plan In April 2020, the board of directors approved the Esperion Therapeutics, Inc. 2020 Employee Stock Purchase Plan (the "ESPP") which was approved by the Company's shareholders on May 28, 2020. The ESPP allows eligible employees to authorize payroll deductions of up to 10% of their base salary or wages up to $25,000 annually to be applied toward the purchase of shares of the Company's common stock on the last trading day of the offering period. Participating employees will purchase shares of the Company's common stock at a discount of up to 15% on the lesser of the closing price of the Company's common stock on the NASDAQ Global Select Market (i) on the first trading day of the offering period or (ii) the last day of any offering period. Offering periods under the ESPP will generally be in six months increments, commencing on September 1 and March 1 of each calendar year with the administrator having the right to establish different offering periods. In the three months ended March 31, 2021, the Company recognized $0.3 million of stock compensation expense related to the ESPP. As of March 31, 2021, there have been 50,818 shares issued and 774,182 shares reserved for future issuance under the ESPP. Stock Options The following table summarizes the activity relating to the Company’s options to purchase common stock for the three months ended March 31, 2021: Number of Options Weighted-Average Exercise Price Per Share Weighted-Average Remaining Contractual Term (Years) Aggregate Intrinsic Value (in thousands) Outstanding at December 31, 2020 4,176,518 $ 40.24 5.28 $ 18,415 Granted 458,000 $ 32.12 Forfeited or expired (431,675) $ 54.06 Exercised (172,268) $ 15.49 Outstanding at March 31, 2021 4,030,575 $ 38.90 5.75 $ 19,711 The following table summarizes information about the Company’s stock option plan as of March 31, 2021: Number of Options Weighted-Average Exercise Price Per Share Weighted-Average Remaining Contractual Term (Years) Aggregate Intrinsic Value (in thousands) Vested and expected to vest at March 31, 2021 4,030,575 $ 38.90 5.75 $ 19,711 Exercisable at March 31, 2021 3,025,257 $ 36.81 4.75 $ 19,711 Stock-based compensation related to stock options was $3.7 million and $5.6 million for the three months ended March 31, 2021 and 2020, respectively, including $0.3 million and $0.2 million that were capitalized into inventory. As of March 31, 2021, there was $28.7 million of unrecognized stock-based compensation expense related to unvested options, which will be recognized over a weighted-average period of 2.6 years. Restricted Stock Units (or RSUs) The following table summarizes the activity relating to the Company’s RSUs for the three months ended March 31, 2021: Number of Weighted-Average Outstanding and unvested December 31, 2020 401,234 $ 46.92 Granted 358,280 $ 31.75 Forfeited (76,468) $ 43.09 Vested (43,465) $ 52.80 Outstanding and unvested March 31, 2021 639,581 $ 38.49 Stock-based compensation related to RSUs was approximately $1.8 million and $1.5 million for the three months ended March 31, 2021 and 2020, respectively, including $0.1 million and less than $0.1 million that were capitalized into inventory. As of March 31, 2021, there was $21.8 million of unrecognized stock-based compensation expense related to unvested RSUs, which will be recognized over a weighted-average period of 3.2 years. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income TaxesThere was no provision for income taxes for the three months ended March 31, 2021 and 2020, because the Company has incurred annual operating losses since inception. At March 31, 2021, the Company continues to conclude that it is not more likely than not that the Company will realize the benefit of its deferred tax assets due to its history of losses. Accordingly, a full valuation allowance has been applied against the net deferred tax assets. |
Net Loss Per Common Share
Net Loss Per Common Share | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share [Abstract] | |
Net Loss Per Common Share | Net Loss Per Common Share Basic net income (loss) per share is calculated by dividing net income (loss) by the weighted-average number of common shares outstanding during the period, without consideration for common stock equivalents. Diluted net income (loss) per share is computed by dividing net income (loss) by the weighted-average number of common stock equivalents outstanding for the period, including shares that potentially could be dilutive if they were exercised or vested during the period, determined using the treasury-stock method. For purposes of this calculation, stock options, unvested RSUs, shares issuable under the ESPP and shares issuable upon conversion of the convertible notes are considered to be common stock equivalents and are only included in the calculation of diluted net loss per share when their effect is dilutive. The shares outstanding at the end of the respective periods presented below were excluded from the calculation of diluted net loss per share due to their anti-dilutive effect: Three Months Ended 2021 2020 Common shares under option 4,030,575 4,829,454 Unvested RSUs 639,581 389,762 Shares issuable related to the ESPP 17,838 — Shares issuable upon conversion of convertible notes 8,460,237 — Total potential dilutive shares 13,148,231 5,219,216 |
Statements of Cash Flows
Statements of Cash Flows | 3 Months Ended |
Mar. 31, 2021 | |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents [Abstract] | |
Statements of Cash Flows | Statements of Cash Flows The following table provides a reconciliation of cash and cash equivalents and restricted cash presented on the condensed balance sheets to the same amounts presented on the condensed statements of cash flows on March 31, 2021 and 2020 and December 31, 2020 and 2019 (in thousands): March 31, March 31, December 31, December 31, Cash and cash equivalents $ 217,939 $ 149,386 $ 304,962 $ 166,130 Restricted cash — 928 — 928 Total cash and cash equivalents and restricted cash shown on the condensed statements of cash flows $ 217,939 $ 150,314 $ 304,962 $ 167,058 |
Subsequent events
Subsequent events | 3 Months Ended |
Mar. 31, 2021 | |
Subsequent Events [Abstract] | |
Subsequent events | Subsequent events Collaboration Agreement with Daiichi Sankyo Co. Ltd. On April 26, 2021, the Company entered into a license and collaboration agreement (the "DS Agreement") with Daiichi Sankyo Co. Ltd. Pursuant to the agreement, the Company granted DS exclusive development and commercialization rights to bempedoic acid and the bempedoic acid / ezetimibe combination tablet in South Korea, Taiwan, Hong Kong, Thailand, Vietnam, Brazil, Macao, Cambodia and Myanmar (collectively the "DS Territory"). The agreement allows for potential expansion across geographies including Saudi Arabia, Kuwait, Oman, UAE, Qatar, Bahrain, Yemen, and other Latin American countries. DS will be responsible for commercialization in these territories, while Esperion remains responsible for certain development and regulatory activities in South Korea and Taiwan. The Company will receive an upfront cash payment of $30.0 million in May 2021 and is eligible to receive up to an additional $175.0 million in sales milestones. The Company will also receive tiered royalties ranging from 5 percent to 20 percent on net sales in the DS Territory. RIPA Amendment On April 26, 2021, the Company entered into Amendment No. 2 (the “RIPA Amendment”) to the Revenue Interest Purchase Agreement with Eiger III SA LLC (“Oberland”), an affiliate of Oberland Capital LLC, as agent for the purchaser parties thereto dated as of June 26, 2019 (as amended by the Amendment No. 1 dated as of November 9, 2020, the “RIPA”). Pursuant to the RIPA Amendment, Oberland Capital waived the original trailing six-month world-wide net sales condition to the third installment payment under the RIPA and released the final $50 million payment payable to the Company under the terms of the RIPA. The Company and Oberland also agreed to amend additional terms of the RIPA such that the purchasers will |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying condensed interim financial statements are unaudited and were prepared by the Company in accordance with generally accepted accounting principles in the United States of America (“GAAP”). In the opinion of management, the |
Use of Estimates | Use of Estimates The preparation of financial statements in accordance with generally accepted accounting principles in the United States requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, net revenues, expenses and related disclosures. Actual results could differ from those estimates. |
Concentration of Risk | Concentration of Risk The Company enters into a limited number of distribution agreements with distributors and specialty pharmacies. The Company's net product sales are with these customers. As of March 31, 2021 and December 31, 2020, eight customers accounted for all of the Company's net trade receivables. |
Revenue Recognition | Revenue Recognition In accordance with ASC 606, Revenue from Contracts with Customers, the Company recognizes revenue when a customer obtains control of promised goods or services, in an amount that reflects the consideration the Company expects to receive in exchange for the goods or services provided. To determine revenue recognition for arrangements within the scope of ASC 606, the Company performs the following five steps: identify the contracts with a customer; identify the performance obligations in the contract; determine the transaction price; allocate the transaction price to the performance obligations in the contract; and recognize revenue when or as the entity satisfies a performance obligation. At contract inception the Company assesses the goods or services promised within each contract and determines those that are performance obligations and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when or as the performance obligation is satisfied. The Company derives revenue through two primary sources: collaboration revenue and product sales. Collaboration revenue consists of the collaboration payments to the Company for collaboration arrangements outside of the United States for the development, manufacturing and commercialization of the Company's product candidates by the Company's partners and product sales consists of sales of NEXLETOL and NEXLIZET. a. Collaboration Revenue The Company has entered into agreements related to its activities to develop, manufacture, and commercialize its product candidates. The Company earns collaboration revenue in connection with a collaboration agreement to develop and/or commercialize product candidates where the Company deems the collaborator to be the customer. Revenue is recognized when (or as) the Company satisfies performance obligations under the terms of a contract. Depending on the terms of the arrangement, the Company may defer the recognition of all or a portion of the consideration received as the performance obligations are satisfied. The collaboration agreements may require the Company to deliver various rights, services, and/or goods across the entire life cycle of a product or product candidate. In an agreement involving multiple goods or services promised to be transferred to a customer, the Company must assess, at the inception of the contract, whether each promise represents a separate performance obligation (i.e., is "distinct"), or whether such promises should be combined as a single performance obligation. The terms of the agreement typically include consideration to be provided to the Company in the form of non-refundable up-front payments, development milestones, sales milestones, and royalties on sales of products within a respective territory. The Company recognizes regulatory and approval milestones consideration when it is probable that a future reversal is unlikely to occur. For sales based milestones and royalties based on sales of product in a territory, the Company applies the sales-based royalty exception in ASC 606-10-55-65 to all of these milestones and royalties. At the inception of the contract, the transaction price reflects the amount of consideration the Company expects to be entitled to in exchange for transferring promised goods or services to its customer. In the arrangement where the Company satisfies performance obligation(s) during the regulatory phase over time, the Company recognizes collaboration revenue typically using an input method on the basis of regulatory costs incurred relative to the total expected cost which determines the extent of progress toward completion. The Company reviews the estimate of the transaction price and the total expected cost each period and makes revisions to such estimates as necessary. Under contracted supply agreements with collaborators, the Company may manufacture and supply quantities of active pharmaceutical ingredient (“API”) or bulk tablets reasonably required by collaboration partners for the development or sale of licensed products in their respective territory. The Company recognizes revenue when the collaboration partner has obtained control of the API or bulk tablets. The Company records the costs related to the supply agreement in cost of goods sold on the condensed statements of operations and comprehensive income (loss). Under the Company's collaboration agreements, product sales and cost of sales may be recorded by the Company's collaborators as they are deemed to be the principal in the transaction. The Company receives royalties from the commercialization of such products, and records its share of the variable consideration, representing a percentage of net product sales, as collaboration revenue in the period in which such underlying sales occur and costs are incurred by the collaborator. The collaborator will provide the Company with estimates of its royalties for such quarter; these estimates are reconciled to actual results in the subsequent quarter, and the royalty is adjusted accordingly, as necessary. b. Product Sales, Net On February 21, 2020, the Company announced that the FDA approved NEXLETOL as an adjunct to diet and maximally tolerated statin therapy for the treatment of adults with HeFH or established ASCVD who require additional lowering of LDL-C. On February 26, 2020, the Company announced that the FDA approved NEXLIZET as an adjunct to diet and maximally tolerated statin therapy for the treatment of adults with HeFH or established ASCVD who require additional lowering of LDL-C. On March 30, 2020, NEXLETOL was commercially available in the U.S. through prescription and on June 4, 2020, NEXLIZET was commercially available in the U.S. through prescription. Net product sales totaled $6.4 million and $0.9 million for the three months ended March 31, 2021 and 2020, respectively. The Company sells NEXLETOL and NEXLIZET to wholesalers in the U.S and, in accordance with ASC 606, recognizes revenue at the point in time when the customer is deemed to have obtained control of the product. The customer is deemed to have obtained control of the product at the time of physical receipt of the product at the customers’ distribution facilities, or free on board (“FOB”) destination, the terms of which are designated in the contract. Product sales are recorded at the net selling price, which includes estimates of variable consideration for which reserves are established for (a) rebates and chargebacks, (b) co-pay assistance programs, (c) distribution fees, (d) product returns, and (e) other discounts. Where appropriate, these estimates take into consideration a range of possible outcomes which are probability-weighted for relevant factors such as current contractual and statutory requirements, and forecasted customer buying and payment patterns. Overall, these reserves reflect the Company's best estimates of the amount of consideration to which it is entitled based on the terms of the applicable contract. The amount of variable consideration may be constrained and is included in the net sales price only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period. Given the early stage of the Company’s commercial operations it has provided constraint of its variable consideration due to its potential consumption trends. Actual amounts of consideration ultimately received may differ from the Company's estimates. If actual results in the future vary from estimates, the Company adjusts these estimates, which would affect net product revenue and earnings in the period such variances become known. Liabilities for co-pay assistance, expected product returns, rebates, and distributor fees are classified as “Other accrued liabilities” in the condensed balance sheets. Discounts, such as prompt pay discounts, and chargebacks are recorded as a reduction to trade accounts receivable, which is included in “Other prepaid and current assets” in the condensed balance sheets. Forms of Variable Consideration Rebates and Chargebacks: The Company estimates reductions to product sales for Public Health Service Institutions, such as Medicaid, Medicare and Veterans' Administration ("VA") programs, as well as certain other qualifying federal and state government programs, and other group purchasing organizations. The Company estimates these reductions based upon the Company's contracts with government agencies and other organizations, statutorily defined discounts and estimated payor mix. These organizations purchase directly from the Company's wholesalers at a discount and the wholesalers charge the Company back the difference between the wholesaler price and the discounted price. The Company's liability for Medicaid rebates consists of estimates for claims that a state will make for a current quarter. The Company's reserve for this discounted pricing is based on expected sales to qualified healthcare providers and the chargebacks that customers have already claimed. Co-pay assistance: Eligible patients who have commercial insurance may receive assistance from the Company to reduce the patient's out of pocket costs. The Company will buy down the difference between the amount of the eligible patient's co-pay when the drug is purchased at the pharmacy at a determined price. Liabilities for co-pay assistance are calculated by actual program participation from third-party administrators. Distribution Fees: The Company has written contracts with its customers that include terms for distribution fees and costs for inventory management. The Company estimates and records distribution fees due to its customers based on gross sales. Product Returns: The Company generally offers a right of return based on the product’s expiration date and certain spoilage and damaged instances. The Company estimates the amount of product sales that may be returned and records the estimate as a reduction of product sales in the period the related product sales is recognized. The Company’s estimates for expected returns are based primarily on an ongoing analysis of sales information and visibility into the inventory remaining in the distribution channel. Discounts: The Company provides product discounts, such as prompt pay discounts, to its customers. The Company estimates cash discounts based on terms in negotiated contracts and the Company’s expectations regarding future payment patterns. |
Inventories | Inventories Inventories are stated at the lower of cost or net realizable value and recognized on a first-in, first-out ("FIFO") method. The Company uses standard cost to determine the cost basis for inventory. Inventory is capitalized based on when future economic benefit is expected to be realized. The Company began capitalizing inventory upon receiving FDA approval for NEXLETOL and NEXLIZET on February 21, 2020 and February 26, 2020, respectively. Prior to the FDA approval of NEXLETOL and NEXLIZET, expenses associated with the manufacturing of the Company's products were recorded as research and development expense. The Company analyzes its inventory levels on a periodic basis to determine if any inventory is at risk for expiration prior to sale or has a cost basis that is greater than its estimated future net realizable value. Any adjustments are recognized through cost of goods sold in the period in which they are incurred. |
Recently Implemented Accounting Pronouncements | Recently Implemented Accounting Pronouncements In August 2020, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”). This ASU simplifies the accounting for convertible instruments by removing the separation models for convertible debt with cash conversion features and convertible instruments with a beneficial conversion feature, which requires the fair value of the embedded conversion feature of convertible instruments be allocated to equity. Under ASU 2020-06, a convertible debt instrument with those features will generally be reported as a single liability at its amortized cost with no separate accounting for the embedded conversion features in equity. The adoption of this ASU resulted in the reclassification of the portion of the Company's convertible notes from equity to debt, which also reduces reported interest expense and increases reported net income. ASU 2020-06 requires the application of the if-converted method when calculating diluted earnings per share, eliminating the Company’s ability to use the treasury stock method when certain conditions are met. The ASU is effective for annual reporting periods beginning after December 15, 2021, with early adoption permitted no earlier than fiscal years beginning after December 15, 2020. The Company early adopted this standard as of January 1, 2021 which resulted in a net increase in the convertible notes of approximately $92.0 million, an adjustment to accumulated deficit of $1.5 million, and a reduction to additional paid-in capital of $93.5 million. The tax impact of the adoption was not material. There have been no other material changes to the significant accounting policies previously disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2020. |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | Inventories consist of the following (in thousands): March 31, 2021 December 31, 2020 Raw materials $ 17,505 $ 13,788 Work in process 2,078 2,028 Finished goods 447 320 $ 20,030 $ 16,136 |
Investments (Tables)
Investments (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of Company's Cash Equivalents and Short-Term Investments | The following table summarizes the Company’s cash equivalents and short-term investments (in thousands): March 31, 2021 Amortized Gross Unrealized Gains Gross Unrealized Losses Estimated Cash equivalents: Money market funds $ 206,804 $ — $ — $ 206,804 Total $ 206,804 $ — $ — $ 206,804 December 31, 2020 Amortized Gross Unrealized Gains Gross Unrealized Losses Estimated Cash equivalents: Money market funds $ 281,783 $ — $ — $ 281,783 Total $ 281,783 $ — $ — $ 281,783 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Schedule of the Company's Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis | The following table presents the Company’s financial assets that have been measured at fair value on a recurring basis (in thousands): Description Total Level 1 Level 2 Level 3 March 31, 2021 Assets: Money market funds $ 206,804 $ 206,804 $ — $ — Total assets at fair value $ 206,804 $ 206,804 $ — $ — December 31, 2020 Assets: Money market funds $ 281,783 $ 281,783 $ — $ — Total assets at fair value $ 281,783 $ 281,783 $ — $ — |
Liability Related to the Reve_2
Liability Related to the Revenue Interest Purchase Agreement (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Liability Related to the Revenue Interest Purchase Agreement | |
Summary of Revenue Interest Liability Activity During the Period | The following table summarizes the revenue interest liability activity during the three months ended March 31, 2021: (in thousands) Total revenue interest liability at December 31, 2020 $ 176,604 Interest expense recognized 4,925 Revenue Interests payments (573) Total revenue interest liability at March 31, 2021 $ 180,956 |
Convertible Notes (Tables)
Convertible Notes (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Summary of Convertible Debt | The following tables summarizes the outstanding principal and debt issuance cost balances as follows (in thousands): Convertible note, debt balance Debt issuance cost Convertible notes, net Balance at December 31, 2020 185,100 (5,733) 179,367 Adjustments to net principal due to adoption of ASU 2020-06 94,900 (2,973) 91,927 Balance at January 1, 2021 280,000 (8,706) 271,294 Balance at March 31, 2021 280,000 (8,306) 271,694 |
Balance Sheet Disclosures (Tabl
Balance Sheet Disclosures (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Payables and Accruals [Abstract] | |
Summary of Prepaid and Other Current Assets | Prepaid and other current assets consist of the following (in thousands): March 31, December 31, Accounts receivable $ 17,255 $ 12,388 Insurance receivable 5,000 — Prepaid inventory cost 7,603 5,957 Other prepaid and current assets 4,305 5,609 Total prepaid and other current assets $ 34,163 $ 23,954 |
Schedule of Other Accrued Liabilities | Other accrued liabilities consist of the following (in thousands): March 31, December 31, Accrued legal settlement $ 18,250 $ — Accrued compensation 11,243 15,161 Accrued variable consideration 10,082 5,025 Accrued professional fees 4,845 3,183 Accrued interest on convertible notes 4,169 1,369 Accrued other 177 52 Total other accrued liabilities $ 48,766 $ 24,790 |
Stock Compensation (Tables)
Stock Compensation (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Summary of Activity Relating to the Company's Options to Purchase Common Stock | The following table summarizes the activity relating to the Company’s options to purchase common stock for the three months ended March 31, 2021: Number of Options Weighted-Average Exercise Price Per Share Weighted-Average Remaining Contractual Term (Years) Aggregate Intrinsic Value (in thousands) Outstanding at December 31, 2020 4,176,518 $ 40.24 5.28 $ 18,415 Granted 458,000 $ 32.12 Forfeited or expired (431,675) $ 54.06 Exercised (172,268) $ 15.49 Outstanding at March 31, 2021 4,030,575 $ 38.90 5.75 $ 19,711 |
Summary of Information About the Company's Stock Option Plan | The following table summarizes information about the Company’s stock option plan as of March 31, 2021: Number of Options Weighted-Average Exercise Price Per Share Weighted-Average Remaining Contractual Term (Years) Aggregate Intrinsic Value (in thousands) Vested and expected to vest at March 31, 2021 4,030,575 $ 38.90 5.75 $ 19,711 Exercisable at March 31, 2021 3,025,257 $ 36.81 4.75 $ 19,711 |
Summary of Activity Relating to the Company's RSUs | The following table summarizes the activity relating to the Company’s RSUs for the three months ended March 31, 2021: Number of Weighted-Average Outstanding and unvested December 31, 2020 401,234 $ 46.92 Granted 358,280 $ 31.75 Forfeited (76,468) $ 43.09 Vested (43,465) $ 52.80 Outstanding and unvested March 31, 2021 639,581 $ 38.49 |
Net Loss Per Common Share (Tabl
Net Loss Per Common Share (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of Shares Excluded From Calculation of Diluted Net Loss Per Share | The shares outstanding at the end of the respective periods presented below were excluded from the calculation of diluted net loss per share due to their anti-dilutive effect: Three Months Ended 2021 2020 Common shares under option 4,030,575 4,829,454 Unvested RSUs 639,581 389,762 Shares issuable related to the ESPP 17,838 — Shares issuable upon conversion of convertible notes 8,460,237 — Total potential dilutive shares 13,148,231 5,219,216 |
Statements of Cash Flows (Table
Statements of Cash Flows (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents [Abstract] | |
Reconciliation of Cash and Cash Equivalents and Restricted Cash | The following table provides a reconciliation of cash and cash equivalents and restricted cash presented on the condensed balance sheets to the same amounts presented on the condensed statements of cash flows on March 31, 2021 and 2020 and December 31, 2020 and 2019 (in thousands): March 31, March 31, December 31, December 31, Cash and cash equivalents $ 217,939 $ 149,386 $ 304,962 $ 166,130 Restricted cash — 928 — 928 Total cash and cash equivalents and restricted cash shown on the condensed statements of cash flows $ 217,939 $ 150,314 $ 304,962 $ 167,058 |
The Company and Basis of Pres_2
The Company and Basis of Presentation (Details) - USD ($) | Apr. 26, 2021 | Mar. 31, 2021 | Mar. 31, 2020 |
The Company and Basis of Presentation | |||
Proceeds from revenue interest purchase agreement, net of issuance costs | $ 0 | $ 25,000,000 | |
License and Collaboration Agreement | Daiichi Sankyo Co. Ltd | Subsequent Event | |||
The Company and Basis of Presentation | |||
Upfront cash payment | $ 30,000,000 | ||
Potential additional future payments | $ 175,000,000 | ||
License and Collaboration Agreement | Daiichi Sankyo Co. Ltd | Minimum | Subsequent Event | |||
The Company and Basis of Presentation | |||
Percentage of royalties to be received on the net sales | 5.00% | ||
License and Collaboration Agreement | Daiichi Sankyo Co. Ltd | Maximum | Subsequent Event | |||
The Company and Basis of Presentation | |||
Percentage of royalties to be received on the net sales | 20.00% | ||
RIPA Amendment | Oberland | Subsequent Event | |||
The Company and Basis of Presentation | |||
Proceeds from revenue interest purchase agreement, net of issuance costs | $ 50,000,000 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2021USD ($)customerrevenue_source | Mar. 31, 2020USD ($) | Dec. 31, 2020USD ($)customer | Jan. 01, 2021USD ($) | |
Summary of Significant Accounting Policies | ||||
Number of revenue sources | revenue_source | 2 | |||
Total Revenues | $ 7,978 | $ 1,840 | ||
Convertible notes, net of issuance costs | 271,694 | $ 179,367 | ||
Accumulated Deficit | 928,204 | 838,817 | ||
Additional Paid in Capital | (713,782) | $ (797,655) | ||
Product sales, net | ||||
Summary of Significant Accounting Policies | ||||
Total Revenues | $ 6,350 | $ 858 | ||
Cumulative Effect, Period of Adoption, Adjustment | ||||
Summary of Significant Accounting Policies | ||||
Convertible notes, net of issuance costs | $ 92,000 | |||
Accumulated Deficit | 1,500 | |||
Additional Paid in Capital | $ 93,500 | |||
Trade Receivables | Customer Concentration Risk | ||||
Summary of Significant Accounting Policies | ||||
Number of major customers | customer | 8 | 8 |
Collaborations with Third Par_2
Collaborations with Third Parties (Details) - USD ($) | Apr. 17, 2020 | Jan. 02, 2019 | Dec. 31, 2020 | Jun. 30, 2020 | Mar. 31, 2021 | Mar. 31, 2020 |
Collaborations with Third Parties | ||||||
Total revenues | $ 7,978,000 | $ 1,840,000 | ||||
Collaboration revenue | ||||||
Collaborations with Third Parties | ||||||
Total revenues | 1,628,000 | 982,000 | ||||
Daiichi Sankyo Europe GmbH ("DSE") | Regulatory performance obligations | ||||||
Collaborations with Third Parties | ||||||
Upfront payment, revenue recognized | 1,000,000 | |||||
Daiichi Sankyo Europe GmbH ("DSE") | NILEMDO and NUSTENDI, sales of bulk tablets | ||||||
Collaborations with Third Parties | ||||||
Total revenues | 1,600,000 | |||||
License and Collaboration Agreement | Daiichi Sankyo Europe GmbH ("DSE") | ||||||
Collaborations with Third Parties | ||||||
Upfront cash payment | $ 150,000,000 | |||||
Cash payment to the Company upon first commercial sales in the DSE Territory | $ 150,000,000 | |||||
License and Collaboration Agreement | Daiichi Sankyo Europe GmbH ("DSE") | Minimum | ||||||
Collaborations with Third Parties | ||||||
Percentage of royalties to be received on the net sales | 15.00% | |||||
License and Collaboration Agreement | Daiichi Sankyo Europe GmbH ("DSE") | Maximum | ||||||
Collaborations with Third Parties | ||||||
Percentage of royalties to be received on the net sales | 25.00% | |||||
License and Collaboration Agreement | Serometrix | ||||||
Collaborations with Third Parties | ||||||
Upfront cash payment | $ 12,500,000 | |||||
Amended License and Collaboration Agreement | Daiichi Sankyo Europe GmbH ("DSE") | ||||||
Collaborations with Third Parties | ||||||
Proceeds received upon completion of NUSTENDI MAA transfer | $ 150,000,000 | |||||
Exclusive Development and Commercialization Rights to NEXLETOL and NEXLIZET Tablets | Otsuka Pharmaceutical Co, Ltd. | ||||||
Collaborations with Third Parties | ||||||
Upfront cash payment | $ 60,000,000 | |||||
Potential additional future payments | $ 450,000,000 | |||||
Exclusive Development and Commercialization Rights to NEXLETOL and NEXLIZET Tablets | Otsuka Pharmaceutical Co, Ltd. | Minimum | ||||||
Collaborations with Third Parties | ||||||
Percentage of royalties to be received on the net sales | 15.00% | |||||
Exclusive Development and Commercialization Rights to NEXLETOL and NEXLIZET Tablets | Otsuka Pharmaceutical Co, Ltd. | Maximum | ||||||
Collaborations with Third Parties | ||||||
Percentage of royalties to be received on the net sales | 30.00% | |||||
Milestone payment, first JNDA submissions | $ 20,000,000 | |||||
Milestone payment, first NHI Price Listing for NEXLETOL in the Otsuka Territory | 70,000,000 | |||||
Milestone payment, achievement of the primary MACE in the CLEAR Outcomes study and CV risk reduction rate on the U.S. label | 50,000,000 | |||||
Milestone payments related to total net sales achievements | $ 310,000,000 | |||||
Exclusive Development and Commercialization Rights to NEXLETOL and NEXLIZET Tablets | Otsuka Pharmaceutical Co, Ltd. | Collaboration revenue | ||||||
Collaborations with Third Parties | ||||||
Total revenues | $ 0 | $ 0 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 17,505 | $ 13,788 |
Work in process | 2,078 | 2,028 |
Finished goods | 447 | 320 |
Total Inventory | $ 20,030 | $ 16,136 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - Pending Litigation $ in Thousands | 3 Months Ended |
Mar. 31, 2021USD ($) | |
Loss Contingencies [Line Items] | |
Payment to plaintiff | $ 18,250 |
Accrued legal settlement | 18,250 |
Insurance settlement recovery | 5,000 |
Gain (loss) related to litigation settlement | $ (13,250) |
Investments - Summary of Cash E
Investments - Summary of Cash Equivalents and Short-Term Investments (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Investments | ||
Amortized Cost | $ 206,804 | $ 281,783 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 206,804 | 281,783 |
Money market funds | Cash Equivalents | ||
Investments | ||
Amortized Cost | 206,804 | 281,783 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | $ 206,804 | $ 281,783 |
Investments - Narrative (Detail
Investments - Narrative (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Investments | |||
Other income, net | $ 14,000 | $ 368,000 | |
Allowance for credit loss | 0 | 0 | |
Accrued interest receivable | 0 | $ 0 | |
Reclassification out of Accumulated Other Comprehensive Income | |||
Investments | |||
Other income, net | 0 | 0 | |
Other Nonoperating Income (Expense) | |||
Investments | |||
Interest income on investments | $ 400,000 | ||
Other Nonoperating Income (Expense) | Maximum | |||
Investments | |||
Interest income on investments | $ 100,000 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Fair value measurements | ||
Estimated Fair Value | $ 206,804 | $ 281,783 |
Recurring fair value measurement | ||
Fair value measurements | ||
Estimated Fair Value | 206,804 | 281,783 |
Recurring fair value measurement | Money market funds | ||
Fair value measurements | ||
Estimated Fair Value | 206,804 | 281,783 |
Recurring fair value measurement | Level 1 | ||
Fair value measurements | ||
Estimated Fair Value | 206,804 | 281,783 |
Recurring fair value measurement | Level 1 | Money market funds | ||
Fair value measurements | ||
Estimated Fair Value | 206,804 | 281,783 |
Recurring fair value measurement | Level 2 | ||
Fair value measurements | ||
Estimated Fair Value | 0 | 0 |
Recurring fair value measurement | Level 2 | Money market funds | ||
Fair value measurements | ||
Estimated Fair Value | 0 | 0 |
Recurring fair value measurement | Level 3 | ||
Fair value measurements | ||
Estimated Fair Value | 0 | 0 |
Recurring fair value measurement | Level 3 | Money market funds | ||
Fair value measurements | ||
Estimated Fair Value | $ 0 | $ 0 |
Liability Related to the Reve_3
Liability Related to the Revenue Interest Purchase Agreement - Narrative (Details) - USD ($) | Jun. 26, 2019 | Mar. 31, 2020 | Jun. 30, 2019 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 |
Liability Related to the Revenue Interest Purchase Agreement | ||||||
Proceeds from revenue interest liability | $ 0 | $ 25,000,000 | ||||
Revenue interest liability | 180,956,000 | $ 176,604,000 | ||||
Interest expense | 8,125,000 | 4,171,000 | ||||
Revenue Interest Purchase Agreement (RIPA) | ||||||
Liability Related to the Revenue Interest Purchase Agreement | ||||||
Revenue interest liability | 181,000,000 | |||||
Capitalized issuance costs | 500,000 | |||||
Interest expense | 4,900,000 | $ 4,200,000 | ||||
Revenue Interest Purchase Agreement (RIPA) | Oberland | ||||||
Liability Related to the Revenue Interest Purchase Agreement | ||||||
Gross proceeds from revenue interest liability | $ 125,000,000 | |||||
Total amount of subsequent installment, subject to RIPA terms and conditions | 75,000,000 | |||||
Amount of subsequent installment, subject to regulatory approval | 25,000,000 | |||||
Amount of subsequent installment, subject to achievement of sales threshold | 50,000,000 | |||||
Milestone amount for worldwide sales to receive the third payment | $ 100,000,000 | |||||
Consecutive number of months sales must be at or above milestone amount | 6 months | |||||
Proceeds from revenue interest liability | $ 25,000,000 | |||||
Revenue interest rate which will take effect if annual net sales equals or exceeds the sales threshold by December 31, 2021 | 2.50% | |||||
Initial revenue interest rate | 7.50% | |||||
Minimum amount of annual net sales to qualify for reduced revenue interest rate by December 31, 2021 | $ 350,000,000 | |||||
Percentage of invested capital received by December 31, 2024, to qualify for second reduced revenue interest rate | 100.00% | |||||
Revenue interest rate if annual net sales equal or exceed the Sales Threshold and if the Purchasers receive 100% of their invested capital by December 31, 2024 | 0.40% | |||||
Percentage of increase in royalty rate upon drawdown of third payment | 33.33% | |||||
Percentage of revenue interests payment on which agreement terminates | 195.00% | |||||
Percentage of revenue interests payment on which agreement terminates, if prior to the anniversary of the closing date, if put option is exercised | 120.00% | |||||
Percentage of revenue interests payment on which agreement terminates, prior to the third anniversary of the closing date, if put option is exercised | 175.00% | |||||
Percentage of revenue interests payment on which agreement terminates, after the third anniversary of the closing date, if put option is exercised | 195.00% | |||||
Capitalized issuance costs | $ 600,000 | |||||
Repayment amount expected to pay in next twelve months | $ 6,400,000 | |||||
Effective annual imputed interest rate (as a percent) | 11.80% | |||||
Revenue Interest Purchase Agreement (RIPA) | Oberland | Net Sales Less Than $250 Million | ||||||
Liability Related to the Revenue Interest Purchase Agreement | ||||||
Initial revenue interest rate | 7.50% | |||||
Minimum amount of annual net sales to qualify for reduced revenue interest rate by December 31, 2021 | $ 250,000,000 | |||||
Hypothetical sales generated amount | 100,000,000 | |||||
Hypothetical repayment obligation | $ 7,500,000 | |||||
Revenue Interest Purchase Agreement (RIPA) | Oberland | Net Sales Greater Than $250 Million But Less Than $350 Million | ||||||
Liability Related to the Revenue Interest Purchase Agreement | ||||||
Revenue interest rate which will take effect if annual net sales equals or exceeds the sales threshold by December 31, 2021 | 2.50% | |||||
Minimum amount of annual net sales to qualify for reduced revenue interest rate by December 31, 2021 | $ 250,000,000 | |||||
Hypothetical sales generated amount | 100,000,000 | |||||
Hypothetical repayment obligation | 2,500,000 | |||||
Revenue Interest Purchase Agreement (RIPA) | Oberland | Net Sales Greater Than $350 Million | ||||||
Liability Related to the Revenue Interest Purchase Agreement | ||||||
Minimum amount of annual net sales to qualify for reduced revenue interest rate by December 31, 2021 | 350,000,000 | |||||
Hypothetical sales generated amount | 100,000,000 | |||||
Hypothetical repayment obligation | $ 2,500,000 |
Liability Related to the Reve_4
Liability Related to the Revenue Interest Purchase Agreement - Summary of Revenue Interest Liability (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Liability From Sale Of Future Revenues [Roll Forward] | ||
Revenue interest liability at December 31, 2020 | $ 176,604 | |
Revenue Interests payments | (573) | $ 0 |
Revenue interest liability at March 31, 2021 | 180,956 | |
Revenue Interest Purchase Agreement (RIPA) | ||
Liability From Sale Of Future Revenues [Roll Forward] | ||
Interest expense recognized | 4,925 | |
Revenue interest liability at March 31, 2021 | $ 181,000 |
Convertible Notes (Details)
Convertible Notes (Details) | Nov. 18, 2020USD ($) | Nov. 16, 2020USD ($)day$ / sharesshares | Mar. 31, 2021USD ($)$ / shares | Dec. 31, 2020USD ($)$ / shares | Jan. 01, 2021USD ($) |
Debt Instrument [Line Items] | |||||
Purchase of capped call options associated with convertible notes | $ 46,000,000 | ||||
Prepayment of forward stock repurchase transaction | $ 55,000,000 | ||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | $ 0.001 | |||
Additional Paid in Capital | $ (713,782,000) | $ (797,655,000) | |||
Accumulated Deficit | 928,204,000 | 838,817,000 | |||
Underlying common stock (in shares) | shares | 1,994,198 | ||||
Cumulative Effect, Period of Adoption, Adjustment | |||||
Debt Instrument [Line Items] | |||||
Additional Paid in Capital | $ 93,500,000 | ||||
Accumulated Deficit | $ 1,500,000 | ||||
Capped Call | Common stock | |||||
Debt Instrument [Line Items] | |||||
Exercise price (in dollars per share) | $ / shares | $ 55.16 | ||||
Class of warrant or right, premium percentage | 100.00% | ||||
Convertible Senior Notes Due 2025 | Convertible Debt | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, face amount | $ 280,000,000 | $ 250,000,000 | |||
Debt instrument, stated interest rate | 4.00% | ||||
Proceeds from debt, net of issuance costs | $ 29,100,000 | $ 242,000,000 | 271,100,000 | ||
Debt instrument, additional principal amount | $ 30,000,000 | ||||
Proceeds from issuance of convertible notes | 280,000,000 | ||||
Debt instrument, convertible, conversion ratio | 30.2151 | ||||
Debt instrument, convertible, conversion price (in dollars per share) | $ / shares | $ 33.096 | ||||
Debt instrument, redemption price, percentage | 100.00% | ||||
Debt issuance cost | $ 8,900,000 | ||||
Debt instrument, term | 5 years | ||||
Long-term debt | $ 177,600,000 | ||||
Debt instrument, convertible, carrying amount of equity component | $ 93,500,000 | ||||
Debt interest expense | 3,200,000 | ||||
Debt fair value | $ 295,100,000 | $ 283,400,000 | |||
Convertible Senior Notes Due 2025 | Convertible Debt | Period One | |||||
Debt Instrument [Line Items] | |||||
Common stock, par value (in dollars per share) | $ / shares | $ 0.001 | ||||
Debt instrument, convertible, threshold percentage of stock price trigger | 130.00% | ||||
Debt instrument, convertible, threshold trading days | day | 20 | ||||
Debt instrument, convertible, threshold consecutive trading days | day | 30 | ||||
Number of business days | day | 5 | ||||
Number of consecutive trading days | day | 5 | ||||
Debt instrument, convertible, threshold percentage of last reported sale price | 98.00% | ||||
Convertible Senior Notes Due 2025 | Convertible Debt | Period Two | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, convertible, threshold percentage of stock price trigger | 130.00% | ||||
Debt instrument, convertible, threshold trading days | day | 20 | ||||
Debt instrument, convertible, threshold consecutive trading days | day | 30 | ||||
Debt instrument, redemption price, percentage | 100.00% | ||||
Debt instrument, required amount outstanding | $ 125,000,000 | ||||
Convertible Senior Notes Due 2025 | Convertible Debt | Long-term Debt | |||||
Debt Instrument [Line Items] | |||||
Debt issuance cost | 5,800,000 | ||||
Convertible Senior Notes Due 2025 | Convertible Debt | Additional Paid-In Capital | |||||
Debt Instrument [Line Items] | |||||
Debt issuance cost | $ 3,100,000 |
Convertible Notes - Summary of
Convertible Notes - Summary of Convertible Debt (Details) - Convertible Debt - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Debt Instrument [Line Items] | ||
Convertible note, debt balance | $ 280,000 | $ 185,100 |
Debt issuance cost | (8,306) | (5,733) |
Convertible notes, net | $ 271,694 | 179,367 |
Cumulative Effect, Period of Adoption, Adjustment | ||
Debt Instrument [Line Items] | ||
Convertible note, debt balance | 94,900 | |
Debt issuance cost | (2,973) | |
Convertible notes, net | 91,927 | |
Cumulative Effect, Period of Adoption, Adjusted Balance | ||
Debt Instrument [Line Items] | ||
Convertible note, debt balance | 280,000 | |
Debt issuance cost | (8,706) | |
Convertible notes, net | $ 271,294 |
Balance Sheet Disclosures - Pre
Balance Sheet Disclosures - Prepaid and Other Current Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Payables and Accruals [Abstract] | ||
Accounts receivable | $ 17,255 | $ 12,388 |
Insurance receivable | 5,000 | 0 |
Prepaid inventory cost | 7,603 | 5,957 |
Other prepaid and current assets | 4,305 | 5,609 |
Other prepaid and current assets | $ 34,163 | $ 23,954 |
Balance Sheet Disclosures - Oth
Balance Sheet Disclosures - Other Accrued Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Payables and Accruals [Abstract] | ||
Accrued legal settlement | $ 18,250 | $ 0 |
Accrued compensation | 11,243 | 15,161 |
Accrued variable consideration | 10,082 | 5,025 |
Accrued professional fees | 4,845 | 3,183 |
Accrued interest on convertible notes | 4,169 | 1,369 |
Accrued other | 177 | 52 |
Total other accrued liabilities | $ 48,766 | $ 24,790 |
Stock Compensation - Employee S
Stock Compensation - Employee Stock Purchase Plan (Details) - Shares issuable related to the ESPP - USD ($) | 1 Months Ended | 3 Months Ended |
Apr. 30, 2020 | Mar. 31, 2021 | |
Employee Stock Purchase Plan | ||
Maximum annual contributions per employee, as a percentage of base salary | 10.00% | |
Amount of maximum annual contributions per employee | $ 25,000 | |
Purchase discount | 15.00% | |
Duration of offering periods | 6 months | |
Stock-based compensation expense | $ 300,000 | |
Shares issued (in shares) | 50,818 | |
Shares reserved for future issuance (in shares) | 774,182 |
Stock Compensation - Schedule o
Stock Compensation - Schedule of Stock Options (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
Number of Options | ||
Outstanding at the beginning of period (in shares) | 4,176,518 | |
Granted (in shares) | 458,000 | |
Forfeited or expired (in shares) | (431,675) | |
Exercised (in shares) | (172,268) | |
Outstanding at the end of the period (in shares) | 4,030,575 | 4,176,518 |
Vested and expected to vest (in shares) | 4,030,575 | |
Exercisable (in shares) | 3,025,257 | |
Weighted-Average Exercise Price Per Share | ||
Outstanding at the beginning of period (in dollars per share) | $ 40.24 | |
Granted (in dollars per share) | 32.12 | |
Forfeited or expired (in dollars per share) | 54.06 | |
Exercised (in dollars per share) | 15.49 | |
Outstanding at the end of the period (in dollars per share) | 38.90 | $ 40.24 |
Vested and expected to vest (in dollars per share) | 38.90 | |
Exercisable (in dollars per share) | $ 36.81 | |
Weighted-Average Remaining Contractual Term (Years) | ||
Outstanding | 5 years 9 months | 5 years 3 months 10 days |
Vested and expected to vest | 5 years 9 months | |
Exercisable | 4 years 9 months | |
Aggregate Intrinsic Value | ||
Outstanding | $ 19,711 | $ 18,415 |
Vested and expected to vest | 19,711 | |
Exercisable | $ 19,711 |
Stock Compensation - Stock Opti
Stock Compensation - Stock Options Additional Information (Details) - Stock Options - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Stock compensation | ||
Stock-based compensation expense | $ 3.7 | $ 5.6 |
Stock-based compensation capitalized into inventory | 0.3 | $ 0.2 |
Unrecognized stock-based compensation expense, options | $ 28.7 | |
Weighted-average period over which remaining unrecognized compensation cost will be recognized | 2 years 7 months 6 days |
Stock Compensation - RSUs (Deta
Stock Compensation - RSUs (Details) - RSUs | 3 Months Ended |
Mar. 31, 2021$ / sharesshares | |
Number of RSUs | |
Outstanding and unvested at the beginning of period (in shares) | shares | 401,234 |
Granted (in shares) | shares | 358,280 |
Forfeited or expired (in shares) | shares | (76,468) |
Vested (in shares) | shares | (43,465) |
Outstanding and unvested at the ending of period (in shares) | shares | 639,581 |
Weighted-Average Fair Value Per Share | |
Outstanding and unvested at the beginning of period (in dollars per share) | $ / shares | $ 46.92 |
Granted (in dollars per share) | $ / shares | 31.75 |
Forfeited or expired (in dollars per share) | $ / shares | 43.09 |
Vested (in dollars per share) | $ / shares | 52.80 |
Outstanding and unvested at the at the end of the period (in dollars per share) | $ / shares | $ 38.49 |
Stock Compensation - RSUs Addit
Stock Compensation - RSUs Additional Information (Details) - RSUs - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Stock compensation | ||
Stock-based compensation expense | $ 1.8 | $ 1.5 |
Stock-based compensation capitalized into inventory | 0.1 | |
Unrecognized stock-based compensation expense, RSUs | $ 21.8 | |
Weighted-average period over which remaining unrecognized compensation cost will be recognized | 3 years 2 months 12 days | |
Maximum | ||
Stock compensation | ||
Stock-based compensation capitalized into inventory | $ 0.1 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Provision for income taxes | ||
Provision for income taxes | $ 0 | $ 0 |
Net Loss Per Common Share (Deta
Net Loss Per Common Share (Details) - shares | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Net Income (Loss) Per Common Share | ||
Total potential dilutive shares (in shares) | 13,148,231 | 5,219,216 |
Common shares under option | ||
Net Income (Loss) Per Common Share | ||
Total potential dilutive shares (in shares) | 4,030,575 | 4,829,454 |
Unvested RSUs | ||
Net Income (Loss) Per Common Share | ||
Total potential dilutive shares (in shares) | 639,581 | 389,762 |
Shares issuable related to the ESPP | ||
Net Income (Loss) Per Common Share | ||
Total potential dilutive shares (in shares) | 17,838 | 0 |
Shares issuable upon conversion of convertible notes | ||
Net Income (Loss) Per Common Share | ||
Total potential dilutive shares (in shares) | 8,460,237 | 0 |
Statements of Cash Flows (Detai
Statements of Cash Flows (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents [Abstract] | ||||
Cash and cash equivalents | $ 217,939 | $ 304,962 | $ 149,386 | $ 166,130 |
Restricted cash | 0 | 0 | 928 | 928 |
Total cash and cash equivalents and restricted cash shown on the condensed statements of cash flows | $ 217,939 | $ 304,962 | $ 150,314 | $ 167,058 |
Subsequent events (Details)
Subsequent events (Details) - USD ($) | Apr. 26, 2021 | Mar. 31, 2021 | Mar. 31, 2020 |
Subsequent Event [Line Items] | |||
Proceeds from revenue interest purchase agreement, net of issuance costs | $ 0 | $ 25,000,000 | |
Daiichi Sankyo Co. Ltd | Subsequent Event | License and Collaboration Agreement | |||
Subsequent Event [Line Items] | |||
Upfront cash payment | $ 30,000,000 | ||
Potential additional future payments | $ 175,000,000 | ||
Daiichi Sankyo Co. Ltd | Minimum | Subsequent Event | License and Collaboration Agreement | |||
Subsequent Event [Line Items] | |||
Percentage of royalties to be received on the net sales | 5.00% | ||
Daiichi Sankyo Co. Ltd | Maximum | Subsequent Event | License and Collaboration Agreement | |||
Subsequent Event [Line Items] | |||
Percentage of royalties to be received on the net sales | 20.00% | ||
Oberland | Subsequent Event | RIPA Amendment | |||
Subsequent Event [Line Items] | |||
Proceeds from revenue interest purchase agreement, net of issuance costs | $ 50,000,000 | ||
Revenue interest rate which will take effect if annual net sales equals or exceeds the sales threshold by December 31, 2024 | 3.33% | ||
Initial revenue interest rate | 10.00% | ||
Minimum amount of annual net sales to qualify for reduced revenue interest rate by December 31, 2024, contingent on 100% invested capital received | $ 350,000,000 | ||
Percentage of invested capital received by December 31, 2024, to qualify for second reduced revenue interest rate | 100.00% | ||
Amount of annual U.S. net sales for the year ended December 31, 2021 to not have the Covered Territory expand from the United States to world-wide net sales | $ 350,000,000 | ||
Percentage of revenue interests payment on which agreement terminates, prior to the third anniversary of the closing date, if put option is exercised | 200.00% | ||
Percentage of revenue interests payment on which agreement terminates, after the third anniversary of the closing date, if put option is exercised | 225.00% |