Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Feb. 28, 2017 | Jun. 30, 2016 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2016 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | CHRS | ||
Entity Registrant Name | Coherus BioSciences, Inc. | ||
Entity Central Index Key | 1,512,762 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 51,147,165 | ||
Entity Public Float | $ 464.1 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 124,947 | $ 158,226 |
Restricted cash | 60 | 60 |
Receivables from collaboration and license agreement | 1,859 | 1,560 |
Prepaid assets (includes related parties of $3,714 and $10,901 as of December 31, 2016 and 2015, respectively) | 31,634 | 34,743 |
Other assets (includes related parties of $2,184 and $0 as of December 31, 2016 and 2015, respectively) | 2,986 | 2,797 |
Total current assets | 161,486 | 197,386 |
Property and equipment, net | 10,772 | 10,504 |
Intangible assets | 2,620 | 2,620 |
Goodwill | 943 | 943 |
Restricted cash, non-current | 785 | 785 |
Other assets, non-current | 1,879 | 146 |
Total assets | 178,485 | 212,384 |
Current liabilities: | ||
Accounts payable | 19,706 | 25,948 |
Accounts payable - related parties | 877 | 3,548 |
Accrued liabilities (includes related parties of $3,542 and $6,122 as of December 31, 2016 and 2015, respectively) | 28,022 | 24,133 |
Advance payments under license agreement | 1,070 | 1,330 |
Deferred revenue | 892 | 49,621 |
Contingent consideration | 5,550 | 1,245 |
Other liabilities | 259 | 193 |
Total current liabilities | 56,376 | 106,018 |
Deferred revenue, non-current | 669 | 45,338 |
Convertible notes | 75,192 | |
Convertible notes - related parties | 25,064 | |
Contingent liability to collaborator | 66,255 | |
Other liabilities, non-current | 1,830 | 1,702 |
Total liabilities | 159,131 | 219,313 |
Commitments and contingencies (Note 8) | ||
Stockholders’ equity (deficit): | ||
Preferred stock, $0.0001 par value; Shares authorized: 5,000,000; Shares issued and outstanding: no shares at December 31, 2016 and 2015. | ||
Common stock, $0.0001 par value; Shares authorized: 300,000,000; Shares issued and outstanding: 45,808,163 and 39,005,589 at December 31, 2016 and 2015, respectively | 5 | 4 |
Additional paid-in capital | 558,474 | 404,175 |
Accumulated other comprehensive loss | (630) | (401) |
Accumulated deficit | (537,322) | (409,985) |
Total Coherus stockholders' equity (deficit) | 20,527 | (6,207) |
Non-controlling interest | (1,173) | (722) |
Total stockholders' equity (deficit) | 19,354 | (6,929) |
Total liabilities and stockholders’ equity (deficit) | $ 178,485 | $ 212,384 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Accrued liabilities, related parties | $ 3,542 | $ 6,122 |
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 300,000,000 | 300,000,000 |
Common stock, shares issued | 45,808,163 | 45,808,163 |
Common stock, shares outstanding | 39,005,589 | 39,005,589 |
Prepaid assets | $ 31,634 | $ 34,743 |
Other assets, related parties | 2,184 | 0 |
Clinical Material Manufacturing and Other Related Parties | ||
Prepaid assets | $ 3,714 | $ 10,901 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||
Revenue: | ||||
Collaboration and license revenue | $ 189,476 | $ 30,041 | $ 30,374 | |
Other revenue | 630 | 732 | ||
Total revenue | 190,106 | 30,041 | 31,106 | |
Operating expenses: | ||||
Research and development (includes related party of $34,705, $42,768 and $21,723 for the years ended December 31, 2016, 2015 and 2014, respectively) | 254,440 | 213,062 | 78,224 | |
General and administrative (includes related party of $178, $559 and $597 for the years ended December 31, 2016, 2015 and 2014, respectively) | 51,597 | 36,046 | 17,564 | |
Total operating expenses | 306,037 | 249,108 | 95,788 | |
Loss from operations | (115,931) | (219,067) | (64,682) | |
Interest expense (includes related party of $1,980, $0 and $2,687 for the years ended December 31, 2016, 2015 and 2014, respectively) | (7,980) | (33) | (3,900) | |
Other expense, net | (3,877) | (4,838) | (18,595) | |
Net loss | (127,788) | (223,938) | (87,177) | |
Net loss attributable to non-controlling interest | 451 | 678 | 44 | |
Net loss attributable to Coherus | $ (127,337) | $ (223,260) | $ (87,133) | |
Net loss per share attributable to Coherus, basic and diluted | $ (3.04) | $ (6.01) | $ (10.64) | |
Weighted-average number of shares used in computing net loss per share attributable to Coherus, basic and diluted | 41,912,300 | 37,122,008 | 8,186,529 | |
Baxalta License Agreement | ||||
Revenue: | ||||
Collaboration and license revenue | $ 188,292 | $ 27,802 | $ 28,481 | |
Daiichi Sankyo - Related Party | ||||
Revenue: | ||||
Collaboration and license revenue | [1] | $ 1,184 | $ 2,239 | $ 1,893 |
[1] | Represents revenue from Daiichi Sankyo through November 12, 2014 as a related party, a holder of more than 10% of our common stock until the closing of our initial public offering (“IPO”). |
Consolidated Statements of Ope5
Consolidated Statements of Operations (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Statement [Abstract] | |||
Research and development from transactions with related party | $ 34,705 | $ 42,768 | $ 21,723 |
General and administrative expenses from transactions with related party | 178 | 559 | 597 |
Interest expense from transactions with related party | $ 1,980 | $ 0 | $ 2,687 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Statement Of Income And Comprehensive Income [Abstract] | |||
Net loss | $ (127,788) | $ (223,938) | $ (87,177) |
Other comprehensive loss: | |||
Foreign currency translation adjustments, net of tax | (229) | 124 | (525) |
Comprehensive loss | (128,017) | (223,814) | (87,702) |
Comprehensive loss attributable to non-controlling interest | 451 | 678 | 44 |
Comprehensive loss attributable to Coherus | $ (127,566) | $ (223,136) | $ (87,658) |
Consolidated Statements of Conv
Consolidated Statements of Convertible Preferred Stock and Stockholders' Equity (Deficit) - USD ($) $ in Thousands | Total | InteKrin | IPO | Follow-On Public Offering | Private Placement | Common Stock Offering | Common Stock | Common StockInteKrin | Common StockIPO | Common StockIPOWarrant | Common StockFollow-On Public Offering | Common StockPrivate Placement | Common StockCommon Stock Offering | Additional Paid-In Capital | Additional Paid-In CapitalInteKrin | Additional Paid-In CapitalIPO | Additional Paid-In CapitalFollow-On Public Offering | Additional Paid-In CapitalPrivate Placement | Additional Paid-In CapitalCommon Stock Offering | Accumulated Other Comprehensive (Loss) | Accumulated Deficit | Total Coherus Stockholder Equity (Deficit) | Total Coherus Stockholder Equity (Deficit)InteKrin | Total Coherus Stockholder Equity (Deficit)IPO | Total Coherus Stockholder Equity (Deficit)Follow-On Public Offering | Total Coherus Stockholder Equity (Deficit)Private Placement | Total Coherus Stockholder Equity (Deficit)Common Stock Offering | Noncontrolling Interest | Series A Convertible Preferred Stock | Series A Convertible Preferred StockIPO | Series B Convertible Preferred Stock | Series B Convertible Preferred StockIPO | Series C Convertible Preferred Stock | Series C Convertible Preferred StockIPO |
Beginning Balances at Dec. 31, 2013 | $ (97,077) | $ 1 | $ 2,514 | $ (99,592) | $ (97,077) | |||||||||||||||||||||||||||||
Beginning Balances, Shares at Dec. 31, 2013 | 4,837,715 | |||||||||||||||||||||||||||||||||
Beginning Balances at Dec. 31, 2013 | $ 1,191 | $ 53,504 | ||||||||||||||||||||||||||||||||
Beginning Balances, Shares at Dec. 31, 2013 | 972,330 | 8,181,576 | ||||||||||||||||||||||||||||||||
Beneficial conversion feature related to convertible notes issued in 2013 | (3,939) | (3,939) | (3,939) | |||||||||||||||||||||||||||||||
Issuance of convertible preferred stock for InteKrin acquisition | $ 3,667 | |||||||||||||||||||||||||||||||||
Issuance of convertible preferred stock for InteKrin acquisition, Shares | 960,486 | |||||||||||||||||||||||||||||||||
Issuance of convertible preferred stock in exchange for services | $ 57 | $ 100 | ||||||||||||||||||||||||||||||||
Issuance of convertible preferred stock in exchange for services, Shares | 8,185 | 9,997 | ||||||||||||||||||||||||||||||||
Issuance of convertible preferred stock net | $ 54,660 | |||||||||||||||||||||||||||||||||
Issuance of convertible preferred stock net, Shares | 5,488,892 | |||||||||||||||||||||||||||||||||
Issuance of convertible preferred stock value upon conversion of convertible promissory notes | $ 10,583 | |||||||||||||||||||||||||||||||||
Issuance of convertible preferred stock shares upon conversion of convertible promissory notes, Shares | 1,058,089 | |||||||||||||||||||||||||||||||||
Issuance of convertible preferred stock upon exercise of warrants, including the reclassification of the associated convertible preferred stock warrant liability | $ 1,004 | $ 39,277 | ||||||||||||||||||||||||||||||||
Issuance of convertible preferred stock upon exercise of warrants, including the reclassification of the associated convertible preferred stock warrant liability, Shares | 62,251 | 4,574,713 | ||||||||||||||||||||||||||||||||
Issuance of common stock | $ 80,209 | $ 80,209 | $ 80,209 | |||||||||||||||||||||||||||||||
Issuance of common stock, Shares | 6,803,702 | |||||||||||||||||||||||||||||||||
Conversion of convertible preferred stock and common stock warrants to common stock in connection with initial public offering | $ 164,043 | $ 2 | $ 164,041 | $ 164,043 | $ (2,195) | $ (96,505) | $ (65,343) | |||||||||||||||||||||||||||
Conversion of convertible preferred stock and common stock warrants to common stock in connection with initial public offering, Shares | 21,316,519 | 491,580 | (1,034,581) | (13,724,960) | (6,556,978) | |||||||||||||||||||||||||||||
Issuance of common stock options in exchange for services | 48 | 48 | 48 | |||||||||||||||||||||||||||||||
Issuance of common stock upon exercise of stock options | 55 | $ 48,414 | 55 | 55 | ||||||||||||||||||||||||||||||
Repurchase of common stock | (2) | (2) | (2) | |||||||||||||||||||||||||||||||
Repurchase of common stock, Shares | (239,952) | |||||||||||||||||||||||||||||||||
Vesting of restricted common stock issued to founders | 5 | 5 | 5 | |||||||||||||||||||||||||||||||
Stock-based compensation expense | 11,117 | 11,117 | 11,117 | |||||||||||||||||||||||||||||||
Cumulative translation adjustment | (525) | $ (525) | (525) | |||||||||||||||||||||||||||||||
Distributions to non-controlling interest | (44) | $ (44) | ||||||||||||||||||||||||||||||||
Net loss attributable to Coherus | (87,133) | (87,133) | (87,133) | |||||||||||||||||||||||||||||||
Ending Balances at Dec. 31, 2014 | 66,757 | $ 3 | 254,048 | (525) | (186,725) | 66,801 | (44) | |||||||||||||||||||||||||||
Ending Balances, shares at Dec. 31, 2014 | 33,257,978 | |||||||||||||||||||||||||||||||||
Issuance of common stock | $ 112,199 | $ 9,930 | $ 1 | $ 112,198 | $ 9,930 | $ 112,199 | $ 9,930 | |||||||||||||||||||||||||||
Issuance of common stock, Shares | 4,137,931 | 390,167 | ||||||||||||||||||||||||||||||||
Issuance of common stock upon exercise of stock options | 1,429 | 1,429 | 1,429 | |||||||||||||||||||||||||||||||
Issuance of common stock upon exercise of stock options, Shares | 861,137 | |||||||||||||||||||||||||||||||||
Vesting of restricted common stock issued to founders | 9 | 9 | 9 | |||||||||||||||||||||||||||||||
Stock-based compensation expense | 16,712 | 16,712 | 16,712 | |||||||||||||||||||||||||||||||
Cumulative translation adjustment | 124 | 124 | 124 | |||||||||||||||||||||||||||||||
Distributions to non-controlling interest | (678) | (678) | ||||||||||||||||||||||||||||||||
Net loss attributable to Coherus | (223,260) | (223,260) | (223,260) | |||||||||||||||||||||||||||||||
Ending Balances at Dec. 31, 2015 | $ (6,929) | $ 4 | 404,175 | (401) | (409,985) | (6,207) | (722) | |||||||||||||||||||||||||||
Ending Balances, shares at Dec. 31, 2015 | 39,005,589 | 39,005,589 | ||||||||||||||||||||||||||||||||
Issuance of common stock upon payment of InteKrin Earn Out contingency | $ 9,849 | $ 9,849 | $ 9,849 | |||||||||||||||||||||||||||||||
Issuance of common stock upon payment of InteKrin Earn Out contingency, Shares | 358,384,000 | |||||||||||||||||||||||||||||||||
Retired shares resulting from InteKrin escrow distribution in cash | (8) | |||||||||||||||||||||||||||||||||
Issuance of common stock | $ 123,567 | $ 1 | $ 123,566 | $ 123,567 | ||||||||||||||||||||||||||||||
Issuance of common stock, Shares | 6,040,987 | |||||||||||||||||||||||||||||||||
Issuance of common stock upon exercise of stock options | $ 3,312 | 3,312 | 3,312 | |||||||||||||||||||||||||||||||
Issuance of common stock upon exercise of stock options, Shares | 761,587 | 761,587 | ||||||||||||||||||||||||||||||||
Stock-based compensation expense | $ 27,421 | 27,421 | 27,421 | |||||||||||||||||||||||||||||||
Cumulative translation adjustment | (229) | (229) | (229) | |||||||||||||||||||||||||||||||
Distributions to non-controlling interest | (451) | (451) | ||||||||||||||||||||||||||||||||
Net loss attributable to Coherus | (127,337) | (127,337) | (127,337) | |||||||||||||||||||||||||||||||
Ending Balances at Dec. 31, 2016 | $ 19,354 | $ 5 | $ 558,474 | $ (630) | $ (537,322) | $ 20,527 | $ (1,173) | |||||||||||||||||||||||||||
Ending Balances, shares at Dec. 31, 2016 | 39,005,589 | 45,808,163 |
Consolidated Statements of Con8
Consolidated Statements of Convertible Preferred Stock and Stockholders' Equity (Deficit) (Parenthetical) | 12 Months Ended |
Dec. 31, 2014$ / shares | |
Series C Convertible Preferred Stock | |
Issuance price per share of convertible preferred stock | $ 6 |
Conversion price per share of convertible preferred stock | 6 |
Exchange price per share of convertible preferred stock for services | $ 6 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Operating activities | |||
Net loss | $ (127,788) | $ (223,938) | $ (87,177) |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Depreciation and amortization | 2,996 | 1,869 | 674 |
Remeasurement of fair-value contingent consideration | 4,305 | 4,599 | 5,185 |
Remeasurement of convertible preferred stock warrant and embedded derivative liabilities | 15,899 | ||
Preferred stock issued in exchange for services | 147 | ||
Non-cash interest expense (income) from amortization of debt discount (receivable) | 1,041 | (38) | 3,897 |
Gain on extinguishment of 2013 Notes | (2,048) | ||
Gain on (impairment of) property and equipment | (6) | 382 | |
Provision for other receivables | (1,300) | 1,300 | |
Stock-based compensation expense | 27,421 | 16,721 | 11,062 |
Changes in operating assets and liabilities: | |||
Receivables from collaboration and license agreement | (299) | 857 | (2,139) |
Notes receivable | 1,853 | (1,815) | |
Notes receivable from related parties | 107 | ||
Prepaid assets | 3,127 | (14,288) | (14,692) |
Other assets | 1,111 | (3,329) | (2,046) |
Other assets - related party | 1,691 | (1,691) | |
Other assets, non-current | 88 | 42 | (25) |
Accounts payable | (4,965) | 18,404 | 3,629 |
Accounts payable - related parties | (2,671) | 1,528 | 1,637 |
Accrued liabilities | 3,953 | 12,832 | 3,949 |
Other liabilities | 65 | (28) | 31 |
Deferred revenue | (93,236) | 32,294 | 19,848 |
Advance payments under license agreements | (260) | 138 | 1,192 |
Contingent liability to collaborator | (66,255) | 38,605 | 20,150 |
Other liabilities, non-current | 128 | 516 | 299 |
Net cash used in operating activities | (252,545) | (107,990) | (23,927) |
Investing activities | |||
Net cash acquired from acquisition of InteKrin Therapeutics Inc. | 2,334 | ||
Purchases of property and equipment | (6,515) | (6,164) | (2,849) |
Increase in restricted cash | (785) | (10) | |
Net cash used in investing activities | (6,515) | (6,949) | (525) |
Financing activities | |||
Proceeds from issuance of convertible preferred stock, net of issuance costs | 54,660 | ||
Proceeds from issuance of convertible notes | 75,000 | ||
Proceeds from issuance of convertible notes - related parties | 25,000 | ||
Proceeds from issuance of convertible preferred stock upon exercise of warrants | 131 | ||
Proceeds from initial public offering, net of underwriters discounts and commissions | 85,419 | ||
Proceeds from follow-on offering, net of underwriters discounts and commissions | 112,800 | ||
Proceeds from private placement | 10,000 | ||
Proceeds from common stock offerings, net of underwriters discounts and commissions | 124,311 | ||
Payments of convertible notes issuance costs | (739) | ||
Proceeds from issuances of common stock upon exercise of stock options | 3,312 | 1,429 | 55 |
Repurchase of restricted common stock | (2) | ||
Net cash provided by financing activities | 226,179 | 122,689 | 135,956 |
Effect of exchange rate changes in cash and cash equivalents | (398) | 84 | (666) |
Net (decrease) increase in cash and cash equivalents | (33,279) | 7,834 | 110,838 |
Cash and cash equivalents at beginning of period | 158,226 | 150,392 | 39,554 |
Cash and cash equivalents at end of period | 124,947 | 158,226 | 150,392 |
Supplemental disclosure of cash flow information | |||
Cash paid for interest | 6,939 | 33 | 1 |
Supplemental disclosures of noncash investing and financing activities | |||
Contingent consideration accrued in connection with acquisition | 1,310 | ||
Reclassification of fair value of convertible preferred stock warrants to preferred stock upon exercise | 40,150 | ||
Purchase of property and equipment in accounts payable and accrued liabilities | 507 | 1,684 | 726 |
Leasehold improvements allowance from landlord | 1,239 | ||
Initial public offering costs in accounts payable | 855 | ||
Costs related to future offerings in accounts payable and accrued liabilities | 124 | ||
Common stock offering costs in accounts payable and accrued liabilities | 39 | ||
Accrued expenses settled in common stock warrants | 55 | ||
Accrued expenses settled in preferred stock | 10 | ||
Fair value of contingent consideration settled in common stock | 9,849 | ||
Series B Convertible Preferred Stock | |||
Supplemental disclosures of noncash investing and financing activities | |||
Issuance of Series B Preferred stock for acquisition | 3,667 | ||
Series C Convertible Preferred Stock | |||
Supplemental disclosures of noncash investing and financing activities | |||
Conversion of 2013 Notes and accrued interest into Series C convertible preferred stock | 10,583 | ||
Initial Public Offering | |||
Financing activities | |||
Payments of offering costs | (855) | $ (4,307) | |
Follow-On Public Offering and Private Placement | |||
Financing activities | |||
Payments of offering costs | (672) | ||
Future Offerings | |||
Financing activities | |||
Payments of offering costs | $ (13) | ||
Common Stock Offering | |||
Financing activities | |||
Payments of offering costs | $ (705) |
Organization and Operations
Organization and Operations | 12 Months Ended |
Dec. 31, 2016 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Organization and Operations | 1. Organization and Operations Description of the Business The Company is a late-stage clinical biologics platform company, focused on the global biosimilar market. The Company’s headquarters and laboratories are located in Redwood City, California and in Camarillo, California, respectively. Need to Raise Additional Capital As of December 31, 2016, the Company had an accumulated deficit of $537.3 million and cash and cash equivalents of $124.9 million. In January 2017, the Company issued and sold 148,827 shares of common stock at a weighted average price of $28.88 per share through its ATM Offering Program and received total net proceeds of $4.2 million, and in February and March 2017, the Company issued and sold 5,294,902 shares of common stock at a price of $24.25 per share from its follow-on offering and received total net proceeds of $120.3 million (see Note 16). The Company believes that its current available cash and cash equivalents, together with proceeds from the common stock offerings and funding it expects to receive under its license agreements with Daiichi, will be sufficient to fund its planned expenditures and meet the Company’s obligations through at least the next 12 months . |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Summary of Significant Accounting Policies | 2. Basis of Presentation and Summary of Significant Accounting Policies Basis of Consolidation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). The accompanying consolidated financial statements include the accounts of Coherus and its wholly owned subsidiaries as of December 31, 2016: Coherus Intermediate Corp, Coherus Oncology, Inc., Orphonix, Inc., InteKrin Therapeutics Inc. (“InteKrin”), and InteKrin’s 82.5% majority owned subsidiary of InteKrin Russia. Unless otherwise specified, references to the Company are references to Coherus and its consolidated subsidiaries. All intercompany transactions and balances have been eliminated upon consolidation. Reclassification To maintain comparability among the periods presented, the Company reclassified certain prior period amounts to a separate line item that was not included in the prior period presentation. Within Note 4, Accrued Liabilities, in the Notes to the Consolidated Financial Statements for the year ended December 31, 2015, the Company reclassified amounts that were recorded within accrued professional and consulting fees to accrued other. The reclassification had no impact on the total current accrued liabilities for the periods presented. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts and disclosures reported in the financial statements. Management uses significant judgment when making estimates related to its stock-based compensation, valuation of deferred tax assets, impairment of goodwill and long-lived assets, the valuation of acquired intangible assets, clinical trial accruals, revenue recognition period, contingent consideration, convertible notes valuation, as well as certain accrued liabilities; and in prior years, common stock valuation, the valuations of the convertible preferred stock warrant liability and embedded derivative instruments. Management bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ from these estimates. Foreign Currency The functional currency of InteKrin Russia, which the Company acquired in February 2014, is the Russian Ruble. Accordingly, the financial statements of this subsidiary are translated into U.S. dollars using appropriate exchange rates. Unrealized gains or losses on translation are recognized in accumulated other comprehensive loss in the consolidated balance sheet. For the years ended December 31, 2016, 2015 and 2014, the foreign exchange gains and losses recorded in other expense, net in the consolidated statements of operations were a net loss of $53,000, a net loss of $386,000 and a net gain of $671,000, respectively. Segment Reporting and Customer Concentration The Company operates and manages its business as one reportable and operating segment, which is the business of developing and commercializing biosimilar products, and, as part of the InteKrin acquisition, small molecules (see Note 6). The Company’s chief executive officer, who is the chief operating decision maker, reviews financial information on an aggregate basis for purposes of allocating resources and evaluating financial performance. Long-lived assets are primarily maintained in the United States of America. The following table summarizes revenue by geographic region (in thousands): Year Ended December 31, 2016 2015 2014 United States $ 188,292 $ 27,802 $ 28,481 Rest of world 1,814 2,239 2,625 Total revenue $ 190,106 $ 30,041 $ 31,106 Customer Concentration Customers whose collaboration and license revenue accounted for 10% or more of total revenues were as follows: Year Ended December 31, 2016 2015 2014 Baxalta 99 % 93 % 92 % Deferred Offering Costs Deferred offering costs, which primarily consist of direct incremental legal and accounting fee, are capitalized in other assets, non-current until the completion of the offering. These deferred offering costs will be reclassified to additional paid-in capital upon the closing of the offering. There was $137,000 in deferred offering costs capitalized as of December 31, 2015 and none capitalized as of December 31, 2016. Cash and Cash Equivalents The Company considers all highly liquid investments with original maturities of 90 days or less at the date of purchase to be cash and cash equivalents. Restricted Cash Restricted cash consists of cash held in money market accounts with a bank. The restricted cash that is used as collateral against the Company’s corporate credit cards is classified as current and the restricted cash to cover the standby letter of credit issued for the Company’s landlord to drawdown on if the facility lease is breached, is classified as non-current (see Note 8). Concentration of Credit Risk The Company’s financial instruments that are exposed to concentration of credit risk consist primarily of cash and cash equivalents. The Company maintains its cash in bank accounts which at times exceed federally insured limits. The Company attempts to minimize the risks related to cash and cash equivalents by investing in money markets with a broad and diverse range of financial instruments. The investment portfolio is maintained in accordance with the Company’s investment policy, which defines allowable investments, specifies credit quality standards and limits the credit exposure of any single issuer. Fair Value of Financial Instruments Fair value accounting is applied for all financial assets and liabilities and non-financial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring basis. Property and Equipment Property and equipment are stated at cost less accumulated depreciation and amortization. Maintenance and repairs are charged to expense as incurred, and costs of improvements are capitalized. Depreciation and amortization is recognized using the straight-line method over the following estimated useful lives: Computer equipment and software 3 years Furniture and fixtures 5 years Machinery and equipment 5 years Leasehold improvements Shorter of lease term or useful life Impairment of Long Lived Assets and Acquired Intangible Asset The Company reviews long-lived assets, including property and equipment, and indefinite-lived intangible, for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable. An impairment loss would be recognized when the estimated undiscounted future cash flows expected to result from the use of the asset and its eventual disposition is less than its carrying amount. Impairment, if any, is measured as the amount by which the carrying amount of a long-lived asset exceeds its fair value. For the year ended December 31, 2015, the Company recorded a $382,000 impairment of property and equipment in research and development within the statement of operations. Acquired in-process research and development (“IPR&D”) represents the fair value assigned to research and development assets that have not reached technological feasibility. The Company reviews amounts capitalized as acquired IPR&D for impairment at least annually, and whenever events or changes in circumstances indicate that the carrying value of the assets might not be recoverable. If the carrying value of the acquired IPR&D exceeds its fair value, then the intangible asset is written-down to its fair value. As of December 31, 2016, there have been no such impairments. Once the product candidate derived from the indefinite-lived intangible asset has been developed and commercialized, the useful life will be determined, and the carrying value of the finite-lived asset will be amortized prospectively over that estimated useful life. Alternatively, if the product candidate is abandoned, the carrying value of the intangible will be charged to research and development expense. Goodwill Goodwill represents the excess of the purchase price over the fair value of the net tangible and intangible assets acquired. The Company tests goodwill for impairment at least annually or more frequently if events or changes in circumstances indicate that this asset may be impaired. The goodwill test is based on our single operating segment and reporting unit structure. The Company compares the fair value of its reporting unit to its carrying value. If the carrying value of the net assets assigned to the reporting unit exceeds the fair value of the reporting unit, then the Company would need to determine the implied fair value of the reporting unit’s goodwill. If the carrying value of the reporting unit’s goodwill exceeds its implied fair value, then the Company would record an impairment loss equal to the difference. N o goodwill impairment was identified through December 31, 2016. Convertible Preferred Stock Warrant Liability The Company classified warrants exercisable for shares of the Company’s Series A and Series B convertible preferred stock as derivative liabilities and adjusted their carrying value to fair value at the end of each reporting period as long as such warrants were outstanding. At the end of each reporting period, changes in the fair value of the convertible preferred stock warrant liability during the period were recorded as a component of other expense, net, in the consolidated statements of operations. Derivative Liability The Company has a derivative liability related to the contingent consideration associated with the acquisition of InteKrin. There were two contingent payments payable upon the achievement of certain events: (i) the completion of the first dosing of a human subject in the first Phase 2 clinical trial for InteKrin, (“Earn-Out Payment”) and (ii) upon the execution of any license, sublicense, development, collaboration, joint venture, partnering or similar agreement between the Company and the third party (“Compound Transaction Payment”). The derivative related to the contingent consideration is accounted for as a liability and remeasured to fair value as of each balance sheet date and the related remeasurement adjustment is recognized as other income (expense), net in the consolidated statements of operations. The Company determined the fair value of the two contingent consideration scenarios (the Earn-Out Payment and the Compound Transaction Payment) using a probability-weighted discounted cash flow approach. A probability-weighted value was determined by summing the probability of achieving a contingent payment threshold by the respective contingent payments. The expected cash flows were discounted at a rate selected to capture the risk of achieving the contingent payment thresholds and earning the contingent payment. This risk is comprised of InteKrin’s continued development, a specific risk factor associated with meeting the contingent consideration threshold and related payout, and counterparty risk associated with the payment of the contingent consideration. Accrued Research and Development Expenses Clinical trial costs are a component of research and development expenses. The Company accrues and expenses clinical trial activities performed by third parties based upon actual work completed in accordance with agreements established with clinical research organizations and clinical sites. The Company determines the actual costs through monitoring patient enrollment, discussions with internal personnel and external service providers as to the progress or stage of completion of trials or services and the agreed-upon fee to be paid for such services. Revenue Recognition The Company recognizes revenue when persuasive evidence of an arrangement exists; transfer of technology has been completed, services have been performed or products have been delivered; the fee is fixed and determinable; and collection is reasonably assured. For revenue agreements with multiple elements, the Company identifies the deliverables included within the agreement and evaluates which deliverables may represent separate units of accounting based on the achievement of certain criteria, including whether the delivered element has stand-alone value to the collaborator. Deliverables under the arrangement are a separate unit of accounting if (i) the delivered item has value to the customer on a standalone basis and (ii) if the arrangement includes a general right of return relative to the delivered item and delivery or performance of the undelivered items are considered probable and substantially within the Company’s control. The Company determines how to allocate arrangement consideration to identified units of accounting based on the selling price hierarchy provided under the relevant guidance. The selling price used for each unit of accounting is based on vendor-specific objective evidence, if available, third party evidence if vendor-specific objective evidence is not available or estimated selling price if neither vendor-specific nor third-party evidence is available. Management may be required to exercise considerable judgment in determining whether a deliverable is a separate unit of accounting and in estimating the selling prices of identified units of accounting under its agreements. Upfront payments received in connection with licenses of the Company’s technology rights are deferred if facts and circumstances dictate that the license does not have stand-alone value. Such payments are recognized as license revenue over the estimated period of performance that is generally consistent with the terms of the research and development obligations contained in the specific collaboration and license agreement. The Company regularly reviews the estimated period of performance based on the progress made under each arrangement. Amounts received as funding of research and development activities are recognized as revenue if the collaboration arrangement involves the sale of the Company’s research or development services. However, such funding is recognized as a reduction in research and development expense when the Company engages in a research and development project jointly with another entity, with both entities participating in project activities and sharing costs and potential benefits of the arrangement. Payments that are contingent upon the achievement of a substantive milestone are recognized in their entirety in the period in which the milestone is achieved, assuming all other revenue recognition criteria are met. A milestones is defined as an event that can only be achieved based on the Company’s performance where there is substantive uncertainty about whether the event will be achieved at the inception of the arrangement. Events that are contingent only on the passage of time or only on counterparty performance are not considered milestones under accounting guidance. The Company’s evaluation includes an assessment of whether (a) the consideration is commensurate with either (1) the Company’s performance to achieve the milestone, or (2) the enhancement of the value of the delivered item(s) as a result of a specific outcome resulting from the Company’s performance to achieve the milestone, (b) the consideration relates solely to past performance and (c) the consideration is reasonable relative to all of the deliverables and payment terms within the arrangement. The Company evaluates factors such as the scientific, regulatory, commercial and other risks that must be overcome to achieve the respective milestone, the level of effort and investment required to achieve the respective milestone and whether the milestone consideration is reasonable relative to all deliverables and payment terms in the arrangement in making this assessment. Other contingent payments in which a portion of the payment is refundable or adjusts based on future performance or non-performance (e.g., through a penalty or claw-back provision) are not considered to relate solely to the Company’s past performance, and therefore, not considered substantive. Non-substantive contingent payments are classified as deferred revenue if they are ultimately expected to result in revenue recognition. The Company recognizes non-substantive contingent payments over the remaining estimated period of performance once the specific objective is achieved. Any portion of the non-substantive contingent payments which may be required to be refunded to the collaborator are not included in deferred revenue and instead are reflected as contingent liability to collaborator on the consolidated balance sheets. Contingent payments associated with the achievement of specific objectives in certain contracts that are not considered substantive because the Company does not contribute effort to the achievement of such milestones are recognized as revenue upon achievement of the objective, as long as there are no undelivered elements remaining and no continuing performance obligations by the Company, assuming all other revenue recognition criteria are met. Revenue from a government contract is recognized in the period during which the related costs are incurred and the related services are rendered, provided that the funds received are not refundable and applicable conditions under the government contract have been met. Funds received in advance are recorded as deferred revenue. Research and Development Expenses Research and development costs are charged to expenses as incurred. Research and development expenses include, among other costs, salaries and other personnel-related costs, consultant fees, preclinical costs, cost to manufacture drug candidates and clinical trial costs and supplies, laboratory supplies costs and facility-related costs. Costs incurred under agreements with third parties are charged to expense as incurred in accordance with the specific contractual performance terms of such agreements. Costs of third parties include costs associated with manufacturing drug candidates, preclinical and clinical support activities. In certain cases, amounts received as reimbursement of research and development activities from the Company’s collaborators are recognized as a reduction in research and development expense when the Company engages in a research and development project jointly with another party, with both parties incurring costs while actively participating in project activities and both parties sharing costs and potential benefits of the arrangement. Costs incurred under the arrangements where the Company provides research services approximate the amount of revenues recorded. Advance payments for goods or services to be received in the future to be utilized in research and development activities are deferred and capitalized. The capitalized amounts are expensed as the related goods are delivered or the services are received. Stock-Based Compensation The Company measures the cost of equity-based service awards based on the grant-date fair value of the award, and recognizes the cost of such awards straight-line over the vesting period. Because non-cash stock compensation expense is based on awards ultimately expected to vest, it is reduced by an estimate for future forfeitures. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from estimates. The Company accounts for equity instruments issued to nonemployees using the fair value approach. These equity instruments consist of stock options and restricted common stock, which are valued using the Black-Scholes option-pricing model. Stock-based compensation expense is recognized as the equity instruments are earned. The measurement of stock-based compensation is subject to periodic adjustments as the underlying equity instruments vest. The Company utilizes the Black-Scholes option-pricing model for estimating fair value of its stock options and restricted stock granted. Option valuation models, including the Black-Scholes option-pricing model, require the input of highly subjective assumptions, and changes in the assumptions used can materially affect the grant-date fair value of an award. These assumptions include the risk-free rate of interest, expected dividend yield, expected volatility, the expected life of the award, and estimated forfeitures. Income Taxes The Company uses the liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial reporting and the tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company must then assess the likelihood that the resulting deferred tax assets will be realized. A valuation allowance is provided when it is more likely than not that some portion or all of a deferred tax asset will not be realized. Due to the Company’s lack of earnings history, the net deferred tax assets have been fully offset by a valuation allowance. The Company recognizes uncertain income tax positions at the largest amount that is more likely than not to be sustained upon audit by the relevant taxing authority. An uncertain income tax position will not be recognized if it has less than a 50% likelihood of being sustained. The Company does not expect its unrecognized tax benefits to change significantly over the next twelve months. The Company’s policy is to recognize interest and/or penalties related to income tax matters in income tax expense. The Company had accrued no amounts for interest and penalties related to income tax matters in the Company’s consolidated balance sheets at December 31, 2016 and 2015. Comprehensive Loss Comprehensive loss is composed of two components: net loss and other comprehensive loss. Other comprehensive loss refers to gains and losses that under U.S. GAAP are recorded as an element of stockholders’ equity, but are excluded from net loss. The Company’s other comprehensive loss included foreign currency translation adjustments for the years ended December 31, 2016, 2015 and 2014. Net Loss per Share Attributable to Coherus Basic net loss per share attributable to Coherus is calculated by dividing the net loss attributable to Coherus by the weighted-average number of shares of common stock outstanding for the period, without consideration for potential dilutive common shares. Since the Company was in a loss position for all periods presented, basic net loss per share attributable to Coherus is the same as diluted net loss per share attributable to Coherus as the inclusion of all potential dilutive common shares would have been anti-dilutive for all periods presented. Shares of founders’ common stock subject to repurchase are excluded from the calculation of weighted average shares as the vesting of such shares is contingent upon continued services being rendered by such holders. Recent Accounting Pronouncements In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers Revenue from Contracts with Customers Principal versus Agent Considerations Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients The new revenue standard permits two methods of adoption: retrospectively to each prior reporting period presented (full retrospective method), or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (the modified retrospective method). The Company plans to adopt the standard in the first quarter of 2018 using the modified retrospective method. The Company has evaluated its contracts and assessed that the license agreement with Daiichi Sankyo (see Note 5) is the only contract that would be impacted by the new revenue standard, and the Company is currently evaluating the materiality that this contract may have on its consolidated financial statements and related disclosures. In August 2014, the FASB issued ASU No. 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern In January 2016, the FASB issued ASU No. 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities. all annual and interim reporting periods thereafter. E In February 2016, the FASB issued ASU No. 2016-02, Leases In March 2016, the FASB issued ASU No. 2016-09, Compensation-Stock Compensation: Improvements to Employee Share-Based Payment Accounting In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows: Classification of Certain Cash Receipts and Cash Payments In October 2016, the FASB issued ASU No. 2016-16, Income Taxes: Intra-Entity Transfers of Assets Other Than Inventory In January 2017, the FASB issued ASU No. 2017-04, Intangibles-Goodwill and Other: Simplifying the Test for Goodwill Impairment As of January 1, 2016, the Company adopted ASU 2015-03, Simplifying the Presentation of Debt Issuance Costs The Company has reviewed other recent accounting pronouncements and concluded they are either not applicable to the business or that no material effect is expected on the consolidated financial statements as a result of future adoption. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 3. Fair Value Measurements Financial assets and liabilities are recorded at fair value. The carrying amounts of certain of the Company’s financial instruments, including cash and cash equivalents, accounts receivable, accounts payable and other current liabilities approximate their fair value due to their short maturities. Fair value is 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. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The accounting guidance describes a fair value hierarchy based on three levels of inputs that may be used to measure fair value, of which the first two are considered observable and the last is considered unobservable. These levels of inputs are the following: Level 1 — Quoted prices in active markets for identical assets or liabilities. Level 2 — Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The Company’s financial instruments consist of Level 1 assets and Level 3 liabilities. Where quoted prices are available in an active market, securities are classified as Level 1. Level 1 assets consist of highly liquid money market funds that are included in cash and cash equivalents, and restricted cash. There were no unrealized gains and losses in the Company’s investments in these money market funds. In certain cases where there is limited activity or less transparency around inputs to valuation, securities are classified as Level 3. Level 3 liabilities consist of the contingent consideration. Financial assets and liabilities subject to fair value measurements on a recurring basis and the level of inputs used in such measurements are as follows (in thousands): Fair Value Measurements December 31, 2016 Total Level 1 Level 2 Level 3 Assets: Money market funds $ 104,240 $ 104,240 $ — $ — Restricted cash (money market funds) 845 845 — — Total financial assets $ 105,085 $ 105,085 $ — $ — Liabilities: Contingent consideration $ 5,550 $ — $ — $ 5,550 Fair Value Measurements December 31, 2015 Total Level 1 Level 2 Level 3 Assets: Money market funds $ 157,784 $ 157,784 $ — $ — Restricted cash (money market funds) 845 845 — — Total financial assets $ 158,629 $ 158,629 $ — $ — Liabilities: Contingent consideration $ 1,245 $ — $ — $ 1,245 There were no transfers between Level 1 and Level 3 during the periods presented. Contingent Consideration As part of the InteKrin acquisition, the Company recognized contingent consideration associated with potential payments to be made to the former InteKrin stockholders upon the achievement of certain events specified in the agreements (see Note 6). This fair value measurement is based on significant inputs not observable in the market and thus represents a Level 3 measurement within the fair value hierarchy. The InteKrin purchase agreement provides for contingent consideration to be paid upon (i) the first dosing of a human subject in the first Phase 2 Clinical Trial for CHS-131 ("Earn-Out Payment") and (ii) per a compound transaction agreement as defined in the purchase agreement (the “Compound Transaction Payment”). The Company valued the two contingent consideration scenarios (the Earn-Out Payment and the Compound Transaction Payment) using a probability-weighted discounted cash flow approach. A probability of reaching each contingent consideration threshold was estimated by Company’s management. As of December 31, 2014, the Earn-Out Payment was expected to occur in January 2015 with a 98% probability of occurrence. As part of that analysis, a 25% risk-adjusted discount rate was used to measure a present value. A separate credit spread was not applied to the Earn-Out Payment fair value since the consideration was to be made in common stock shares. The size of the contingent consideration was a fixed number of common stock shares, but the value fluctuated with the value of a common stock share. The Compound Transaction applied the same 25% risk-adjusted discount rate and also captured an additional 6% credit spread for counterparty credit risk given the cash payment. The Company’s management estimates of probability of occurrence and timing were used to formulate an expected cash flow. The size of the consideration is tiered based on the size of a license or similar agreement with a third party and the timing of such agreement. The change in the fair value of the contingent consideration liability is recognized in other expense, net within the consolidated statement of operations. On March 6, 2015, the Company achieved the first dosing of a human subject in a phase 2 clinical trial for CHS-131 in multiple sclerosis patients, triggering the obligation to settle the first contingent Earn-Out Payment to former InteKrin stockholders. As a result, the Company issued 358,384 shares of its common stock valued at $27.48 per share and cash of $1,000 for the aggregate amount value of $9.8 million to former InteKrin stockholders. Contemporaneously, the Company recognized the additional fair value of the Earn-Out Payment of $4.1 million to other expense, net, in the consolidated statement of operations on March 6, 2015 and reclassified the contingent consideration liability balance to equity in the consolidated balance sheet. For the years ended December 31, 2015 and 2014, the Company recognized $4.1 million and $5.0 million, respectively, in other expense, net in the consolidated statement of operations for the change in the fair value of the Earn-Out Payment. As of December 31, 2015, the fair value of this contingent consideration liability decreased to $1.2 million to reflect the Earn-Out Payment settlement in March 2015 and the updated fair value estimate of the Compound Transaction Payment. The fair value measurement of the Compound Transaction Payment uses a probability-weighted discounted cash flow approach based on significant inputs not observable in the market and thus represents a Level 3 measurement within the fair value hierarchy. The Compound Transaction analysis as of December 31, 2016 applied a 25% risk-adjusted discount rate to measure present value and also captured an additional 8% credit spread for counterparty credit risk given the cash payment. The Company’s management estimates of probability of occurrence and timing were used to formulate an expected cash flow. During 2016, the Company reported positive Phase 2b efficacy data on CHS-131, in relapsing remitting multiple sclerosis, and as such management’s probability of occurrence of a Compound Transaction increased from 10% to 33%, and as such, the Company valued the contingent consideration liability at $5.6 million at December 31, 2016. Generally, increases or decreases in the probability of occurrence would result in a directionally similar impact in the fair value measurement of the Compound Transaction Payment and it is estimated that a 1% increase (decrease) in the probability of occurrence would result in a fair value fluctuation of approximately $0.2 million. For the years ended December 31, 2016, 2015 and 2014, the Company recognized $4.3 million, $460,000 and $235,000 of expense in other expense, net in the consolidated statement of operations, respectively, as a result of the change in the fair value of the Compound Transaction Payment. The following table sets forth a summary of changes in the estimated fair value of the contingent consideration (in thousands): Balance as of February 12, 2014 (acquisition date) $ 1,310 Change in fair value of the contingent consideration liability 5,185 Balance as of December 31, 2014 6,495 Change in fair value of the contingent consideration liability 4,599 Fair value of Earn-Out Payment settled in common stock on March 6, 2015 (9,849 ) Balance as of December 31, 2015 1,245 Change in fair value of the contingent consideration liability 4,305 Balance as of December 31, 2016 $ 5,550 Convertible Notes The estimated fair value of the 8.2% Convertible Senior Notes Due 2022, which the Company issued on February 29, 2016 (see Note 6) is based on an income approach. The estimated fair value was approximately $168.5 million (par value $100.0 million) as of December 31, 2016 and represents a Level 3 valuation. When determining the estimated fair value of the Company’s long-term debt, the Company uses a single factor binomial lattice model which incorporates the terms and conditions of the convertible notes and market based risk measurement that are indirectly observable, such as credit risk. The lattice model produces an estimated fair value based on changes in the price of the underlying common shares price over successive periods of time. An estimated yield based on market data is used to discount straight debt cash flows. Key valuation assumptions used for the convertible debt valuation was volatility of 60% for the Company’s common stock and straight debt yield of 13.6% as of December 31, 2016. |
Balance Sheet Components
Balance Sheet Components | 12 Months Ended |
Dec. 31, 2016 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Balance Sheet Components | 4. Balance Sheet Components Prepaid Assets Prepaid assets are as follows (in thousands): December 31, December 31, 2016 2015 Prepaid clinical and other - related parties (see Note 15) $ 3,714 $ 10,901 Prepaid clinical, material and manufacturing 25,095 21,191 Prepaid other 2,825 2,651 Prepaid assets $ 31,634 $ 34,743 Property and Equipment, Net Property and equipment, net are as follows (in thousands): December 31, December 31, 2016 2015 Machinery and equipment $ 10,294 $ 7,809 Computer equipment and software 1,500 1,276 Furniture and fixtures 682 596 Leasehold improvements 4,322 4,343 Total property and equipment 16,798 14,024 Accumulated depreciation and amortization (6,026 ) (3,520 ) Property and equipment, net $ 10,772 $ 10,504 Depreciation and amortization expense was $3.0 million, $1.9 million and $674,000 for the years ended December 31, 2016, 2015 and 2014, respectively. Accrued Liabilities Accrued liabilities are as follows (in thousands): December 31, December 31, 2016 2015 Accrued clinical - related parties (see Note 15) $ 3,542 $ 6,122 Accrued clinical and manufacturing 16,039 11,681 Accrued compensation 6,945 4,666 Accrued other 1,496 1,664 Accrued liabilities $ 28,022 $ 24,133 |
Collaboration and License Agree
Collaboration and License Agreement | 12 Months Ended |
Dec. 31, 2016 | |
Collaboration And License Agreements [Abstract] | |
Collaborative and License Agreement | 5. Collaboration and License Agreement The Company recognized revenue related to the collaboration and license agreements for the periods presented as follows (in thousands): Year Ended December 31, 2016 2015 2014 Baxalta $ 188,292 $ 27,802 $ 28,481 Daiichi Sankyo - related party (1) 1,184 2,239 1,893 Total collaboration and license revenue $ 189,476 $ 30,041 $ 30,374 (1) Represents revenue from Daiichi Sankyo through November 12, 2014 as a related party, a holder of more than 10% of our common stock until the closing of our initial public offering (“IPO”). Daiichi Sankyo In January 2012, the Company entered into a license agreement with Daiichi Sankyo, under which the Company granted certain licenses to Daiichi Sankyo to develop and commercialize biosimilar forms of etanercept and rituximab in Japan, Taiwan, and South Korea with an option to develop in China. Under the terms of the agreement, the Company will be responsible for the manufacturing and supply of the products during the development activities and Daiichi Sankyo will conduct the development, regulatory approval filings, and commercialization activities of the biosimilar form of etanercept and rituximab products in Japan. Once the biosimilar forms of etanercept and rituximab are commercialized, the Company is entitled to royalties based on net sales by Daiichi Sankyo on a product-by-product basis in the licensed territories ranging from the low double digits to high teens, on a product-by-product basis. If the Company is manufacturing product, the Company is eligible to receive an incremental royalty reflecting the manufacturing costs for each licensed product which, when combined with the base royalty, will result in royalties equal to a percentage of net sales of licensed products ranging from the low to high-twenties, on a product-by-product basis. Upon execution of the agreement, Daiichi Sankyo paid a non-refundable, upfront license fee of $10.0 million and purchased 2,867,426 shares of Series B convertible preferred stock at a price of $6.9749 per share, or $18.1 million in net cash proceeds. The Company concluded that there was no premium or discount associated with the purchase of the Series B convertible preferred stock since Daiichi Sankyo paid the same price paid by other investors at the close of the Series B convertible preferred stock offering. As such the Company recorded the $18.1 million as a convertible preferred stock transaction separate from the license agreement. The agreement has an initial term of ten years and contains provisions allowing Daiichi Sankyo to renew the agreement for an additional three years with respect to particular countries. Daiichi Sankyo also has the right to terminate the agreement, in its entirety or on a country-by country basis, at any time if the development and/or commercialization is deemed to not be commercially viable, there are material safety, efficacy or patient tolerability issues that cannot be remedied or overcome, or during the opt-out window after the achievement of specified objectives in the agreement. In May 2012, Daiichi Sankyo opted out of the development and commercialization of etanercept in Taiwan and South Korea, and in August 2012, Daiichi Sankyo chose not to exercise their option with respect to the development and commercialization of etanercept and rituximab in China. The Company identified the following deliverables under the agreement: (1) the transfer of intellectual property rights (license), and (2) the manufacture of drug materials for clinical development purposes. The Company considered the provisions of the multiple-element arrangement guidance in determining how to recognize the total consideration of the agreement. The Company has concluded that the license is not a separate unit of accounting because Daiichi Sankyo cannot obtain benefit from the use of the license rights for their intended purpose without the products manufactured by the Company. Daiichi Sankyo must rely upon the Company to manufacture and supply the products necessary for Daiichi Sankyo’s development because the related manufacturing know-how specific to the products is proprietary to the Company and Daiichi Sankyo does not have the right to manufacture the licensed product. The Company determined that neither of the deliverables have standalone value and, therefore, the deliverables are accounted for as a single unit of accounting with the upfront fee recognized as revenue on a straight-line basis over its estimated period of performance of approximately three years. The Company determined that there is no other method that is more appropriate than the straight-line method of revenue recognition for this agreement given there is no discernable pattern of its performance under the arrangement. The Company regularly evaluates the reasonableness of the estimated period of performance and revises the amortization of deferred revenue as deemed appropriate on a prospective basis. As such, the performance period was extended in September 2014 for two quarters, December 2014 for one quarter, September 2015 for two months, May 2016 for four months and December 2016 for six months. In June 2013, the Company and Daiichi entered into a Memorandum of Understanding No. 1 (the “MOU 1”) in which both parties agreed to cooperate and share costs to conduct a global Phase 1 study of a biosimilar form of etanercept. This program was not originally contemplated in the license agreement. Under the MOU 1, the Company will gather all clinical data, format it into a case study report, and conduct the final analysis. The Company will transfer the clinical data and other regulatory approval application documents for the product and post marketing to Daiichi Sankyo within 90 days after such documents are finalized. Under the MOU 1, Daiichi’s Sankyo’s overall cost sharing responsibility include (i) 33% of the total budgeted cost and (ii) 100% of the cost of the comparator drug (Enbrel) used for the Japanese volunteers. The amounts received from Daiichi Sankyo under this cost sharing responsibility are recognized as a reduction in research and development expense as the Company engages in a research and development project jointly with Daiichi Sankyo, with both parties incurring costs while actively participating in development activities and both parties sharing costs and potential benefits of the arrangement. The Company accounted for the MOU 1 as a separate arrangement which was not deemed to be a material modification of the original license agreement with Daiichi Sankyo. In January 2014, the Company and Daiichi Sankyo entered into the Memorandum of Understanding No. 2 (the “MOU 2”) in which both parties agreed to cooperate to conduct a global Phase 3 clinical trial in rheumatoid arthritis. In June 2015, the parties also entered into the Memorandum of Understanding No. 3 (the “MOU 3”) in which both parties agreed to cooperate further on a global Phase 3 clinical trial for an open label, safety extension study (“OLSES”) in rheumatoid arthritis. Daiichi Sankyo will be responsible for a minimum of 20% of the cost of the clinical trial. The Company also entered into a clinical supply agreement as part of MOU 2 and MOU 3 in which the Company will supply finished study drug and study comparator drug for Daiichi Sankyo’s use in the Japanese portion of the product’s clinical trial. Daiichi Sankyo reimburses these research and development costs in quarterly advance payments, for which the Company recorded $1.1 million and $1.3 million as advance payments under license agreement in the consolidated balance sheet as of December 31, 2016 and 2015, respectively. The Company will recognize the advance payment as a reduction in the research and development expense when the research and development activity has been performed. In July 2016 and December 2016, the Company entered into three memoranda of understanding (“MOU 4” “MOU 5” and “MOU 6”) with Daiichi Sankyo. Under MOU 4, MOU 5 and MOU 6, the Company will receive up to $4.5 million for reimbursements of certain past costs incurred and to be incurred and the Company will recognize these reimbursements as a reduction of research and development expenses when the research and development activity is performed. As of December 31, 2016, $1.6 million of revenue was deferred under all arrangements with Daiichi Sankyo, of which $0.9 million was included in current liabilities and $0.7 million was included in non-current liabilities in the consolidated balance sheet. As of December 31, 2015, $2.8 million of revenue was deferred under all arrangements with Daiichi Sankyo, of which $1.5 million was included in current liabilities and $1.3 million was included in non-current liabilities in the consolidated balance sheet. The Company recognized in its consolidated statements of operations a reduction of research and development expense related to the costs reimbursed by Daiichi Sankyo of $9.7 million, $16.1 million and $7.1 million for the years ended December 31, 2016, 2015 and 2014, respectively. Baxalta The Company entered into a license agreement in August 2013 and two subsequent amendments thereto with Baxalta Incorporated, Baxalta US Inc., and Baxalta GmbH (collectively “Baxalta”) (then Baxter International, Inc., part of Shire plc as of June 2016 Under the terms of the agreement, the Company was responsible in conducting the development and the regulatory activities, and Baxalta was responsible in conducting the commercialization of the etanercept biosimilar product. In consideration of the exclusive, royalty-bearing license to develop, commercialize and use the etanercept biosimilar product, the Company received an upfront payment and was eligible to receive contingent payments composed of clinical development payments and regulatory milestone payments. If the cumulative development costs exceed the cumulative contingent payments, Baxalta would reimburse the Company for the excess cost as set forth in the agreement up to predetermined limits. Once the etanercept biosimilar product commercializes, the Company was entitled to tiered royalties, based on the manufacturing cost as a percentage of net sales of licensed products, ranging from the mid-single digits to the high teens on a country-by-country basis. These royalties were subject to certain offsets and reductions. The agreement had an initial term of ten years and contained provisions allowing Baxalta to renew the agreement for another three years on a country-by-country basis. Baxalta also had the right to terminate the agreement, in its entirety or on a country-by country basis, at any time if the development and/or commercialization is deemed to not be commercially viable, there are material safety, efficacy or patient tolerability issues that cannot be remedied or overcome, if aggregate expenses exceed certain thresholds or after the first commercial sale upon 18 month prior written notice. The Company identified the following deliverables under the license agreement with Baxalta: 1) the transfer of intellectual property rights (license), (2) the obligation to provide research and development services including the manufacturing and supply of clinical product, and (3) the obligation to participate on various committees. The Company considered the provisions of the multiple-element arrangement guidance in determining how to recognize the total consideration of the agreement. The Company determined that the license did not have standalone value to Baxalta without the Company’s technical expertise as it relates to the development of the product candidate and committee participation. Additionally, the license to Baxalta did not include the right to manufacture, or have manufactured the product during the development stage, or to conduct any process development activities. Therefore, the Company concluded that these deliverables represent a single unit of accounting under the multiple-element arrangement guidance. The upfront payment and clinical development payments included contingent payments that were intended to cover development related expenses incurred by the Company, but potentially reimbursable, in part, to Baxalta under certain limited circumstances. The Company concluded that the contingent payments that contain potentially reimbursable amounts to Baxalta are not substantive milestones under the relevant accounting guidance, since the guidance does not allow the substantive milestone components of a payment to be bifurcated from non-substantive milestone components. The amounts that were contingent payments also contained a claw-back feature that, in the event that the Company commercializes the etanercept biosimilar molecule in the U.S. without Baxalta, the Company would have been required to refund a portion of those contingent payments to Baxalta. Therefore, the Company recorded the portion of the non-substantive contingent payment that contained the claw-back feature as a liability and would have continued to record such liability until the earlier of: (1) expiration of the license agreement pursuant to its terms in August 2023, (2) the earlier termination of the license agreement, or (3) the determination, pursuant to the terms of the license agreement, of the third party to commercialize CHS-0214 in the U.S. These amounts were included in the contingent liability to collaborator on the consolidated balance sheets. The portion of the non-substantive milestone payment that did not contain the claw-back feature were recorded as deferred revenue and recognized as license revenue on a straight-line basis over the remaining estimated performance period of approximately three years. The Company determined that there was no other method that was more appropriate than the straight-line method of revenue recognition for this agreement given there was no discernable pattern of performance under the arrangement. The Company regularly evaluated the reasonableness of the estimated period of performance and revised the amortization of deferred revenue on a prospective basis, as such, the performance period were extended in September 2014 for two quarters, December 2014 for one quarter, and September 2015 for two months, prior to the termination of the Baxalta Agreement. The regulatory milestone payments were considered substantive as the achievement was subject to the significant uncertainty as to the outcome of the development efforts, by the Company, over an extended period of time, and the Company’s substantive performance obligation under the license agreement which included efforts associated with the clinical trials and filing and approval of drug applications by regulatory authorities in various countries. Therefore, the Company recognized revenue associated with these respective contingent payments when each of the specific events were achieved. Under terms set forth in an amendment to the arrangement, Baxalta purchased an aggregate of 390,167 shares of Company’s common stock at $25.63 per share for aggregate gross proceeds of approximately $10.0 million on September 10, 2015 (see Note 11). On September 26, 2016, Shire issued a termination notice of the Baxalta Agreement, in its entirety as part of its strategic portfolio review after its acquisition of Baxalta. Upon the termination of the Baxalta Agreement, the Company regained from Shire all development and commercial rights previously licensed under the CHS-0214. There were no e Company recognized the outstanding balances of deferred revenue of $85.8 million and contingent liability to collaborator of $76.7 million as revenue in its consolidated statements of operations in 2016. As of December 31, 2015, $92.0 million of revenue was deferred under the arrangements with Baxalta, of which $48.0 million was included in current liabilities and $44.0 million was included in non-current liabilities in the consolidated balance sheet. As of December 31, 2015, $66.3 million was recorded as contingent liability to collaborator in the consolidated balance sheet due to the potential refund to Baxalta. |
Acquisition of InteKrin Therape
Acquisition of InteKrin Therapeutics, Inc. | 12 Months Ended |
Dec. 31, 2016 | |
Business Combinations [Abstract] | |
Acquisition of InteKrin Therapeutics, Inc. | 6. Acquisition of InteKrin Therapeutics Inc. On January 8, 2014, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) to acquire all of the outstanding shares of InteKrin and its 82.5% majority owned subsidiary, InteKrin Russia. On February 12, 2014, the Company completed the acquisition of InteKrin (the “Merger”) for total consideration of $5.0 million. The acquisition was a related party transaction (see Note 15). Prior to the Merger, InteKrin was a privately held, clinical-stage biopharmaceutical company focused on the development and commercialization of novel drugs for the treatment of immune diseases such as multiple sclerosis. InteKrin’s primary product candidate is CHS-131, which is in the clinical stage of development. Although CHS-131 is a small molecule and not a protein, its therapeutic focus area was complementary to the Company’s emerging multiple sclerosis biosimilar product pipeline which consists of broader level, central nervous system anti-inflammatory drug candidates. This in turn was complementary to the Company’s systemic focus on anti-inflammatory drug candidates with the anti-tumor necrosis factor (TNF) portfolio composed of etanercept and adalimumab biosimilars. Additionally, the acquisition of InteKrin was a strategic transaction to obtain funding from new investors. The Company accounted for the InteKrin acquisition as the purchase of a business. The Company expensed the related acquisition costs, consisting primarily of legal expenses in the amount of $134,000. These legal expenses are recorded in general and administrative expense in the consolidated statement of operations for the year ended December 31, 2014. The total consideration of $5.0 million consists of: (a) issuance of 716,645 shares of Series B preferred stock with a fair value of $2.7 million, (b) assumption of InteKrin’s convertible promissory note payable to an InteKrin stockholder, which was concurrently paid off by issuing 243,841 shares of the Company’s Series B convertible preferred stock with a fair value of $1.0 million (c) cash payment of $1,485, and (d) contingent consideration of $1.3 million. The Company determined the fair value of the Series B convertible preferred stock of $3.8174 per share using the PWERM. The non-controlling interest was not deemed to be significant at acquisition. Pro forma results of operations for this acquisition have not been presented as such results are not material to the Company’s results of operations for the years ended December 31, 2014. Intangible Asset — In-process Research and Development The in-process research and development (“IPR&D”) of $2.6 million consists of InteKrin’s CHS-131. The Company determined the fair value of the IPR&D based on the cost to recreate the asset to its current stage as the fair value is not determinable as a result of the lack of financial projections for this asset due to its early development stage. By applying this method, management estimated that $2.6 million of the acquisition consideration represents the fair value of the IPR&D. The IPR&D acquired through the InteKrin acquisition is treated as an indefinite-lived intangible asset and an annual impairment review is performed by management. As of December 31, 2016, there has been no impairment of this IPR&D. Contingent Consideration The contingent consideration is made up of two potential payments as discussed below. Contingent Consideration — Earn-Out Payment: Upon completion of the first dosing of a human subject in the first Phase 2 clinical trial for InteKrin, InteKrin’s stockholders could earn a minimal cash payment and 358,384 shares of the Company’s Series B convertible preferred stock upon the successful achievement of this objective. At the acquisition date, the Company expected the first dosing to be completed in September 2014 and assigned a 75% success probability to the achievement and timing of this event. As such, at the acquisition date, the fair value of the contingent consideration related to this earn-out payment was determined to be $0.8 million. As of the consummation of the IPO in November 2014, such contingent consideration was payable by issuing shares of common stock rather than shares of Series B convertible preferred stock. The contingent consideration related to the earn-out payment was settled in March 2015 (see Note 3). C ontingent Consideration — Compound Transaction Payment: At the acquisition date, the Company valued the two contingent consideration scenarios using a probability-weighted discounted cash flow approach. A probability of reaching each contingent consideration threshold was estimated by management. A probability-weighted value was determined by multiplying the probability of achieving a contingent payment threshold by the respective contingent payment. The expected cash flows were discounted at a rate selected to capture the risk of achieving the contingent payment thresholds and earning the contingent payment. This risk is composed of InteKrin’s continued development, a specific risk factor associated with meeting the contingent consideration threshold and related payout and counterparty risk associated with the payment of the contingent consideration. Goodwill Goodwill in the amount of $0.9 million resulting from this acquisition comprises the excess of the purchase price over the fair value of the underlying net assets acquired and primarily represents the strategic relationship acquired with InteKrin’s investors. None of this goodwill will be deductible for tax purposes. Under the applicable accounting guidance, goodwill will not be amortized but will be tested for impairment on an annual basis or more frequently if certain indicators are present. As of December 31, 2016, there have been no such impairments. Government Contract with the Russian Government In 2012, InteKrin Russia, a subsidiary of InteKrin, was awarded a contract by the Ministry of Industry and Trade of the Russian Federation to perform scientific research and experimental development work for the treatment of multiple sclerosis and conducting its preclinical and clinical studies for a total aggregate amount of 147.9 million RUB ($2.6 million in US dollars as of December 31, 2014) which was expanded multiple years from 2012 to 2015. The contract amount related to the 2014 research period was expected to be 40.0 million RUB. Subsequent to the Company’s acquisition of InteKrin in February 2014, the Company received 12.0 million RUB and 28.0 million RUB in the first and fourth quarter of 2014, respectively, which met all the revenue recognition criteria in the fourth quarter of 2014. Therefore, the Company recognized 40.0 million RUB ($732,000 based on the exchange rate on the date the revenue was recognized) as other revenue in the consolidated statement of operations for the year ended December 31, 2014. The remaining amounts available under the government contract for 2015 was 39.4 million RUB. The Company received 11.8 million RUB and 27.6 million RUB in Q1 2015 and Q4 2016, respectively. These advance receipts of funding were deferred until the Company met all the revenue recognition criteria in Q4 2016. Therefore, the Company recognized revenue of 39.4 million RUB ($630,000 based on the exchange rate on the date the revenue was recognized) as other revenue in the consolidated statement of operations for the years ended December 31, 2016. |
Debt Obligations
Debt Obligations | 12 Months Ended |
Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |
Debt Obligations | 7. Debt Obligations Bridge Loans From July 2013 to September 2013, the Company entered into convertible note agreements (the “Bridge Loans”) with various stockholders, employees and institutions for an aggregate principal amount of $10.0 million. The Bridge Loans accrued interest of 8% per annum and would mature on July 15, 2014. The principal and the accrued interest on the Bridge Loans were converted into 5,488,892 shares of Series C convertible preferred stock in May 2014. In connection with the Bridge Loans, the Company also issued warrants to purchase shares of its convertible preferred stock at an exercise price of $0.0167 per share. The determination of the number of shares issuable pursuant to the 2013 warrants was determined based on 300% of the principal amount of the Bridge Loans divided by the conversion price. In May 2014, the Company completed an equity financing of Series C convertible preferred stock and, as a result, the Bridge Loans and related accrued interest of $10.6 million automatically converted into 1,058,089 shares of Series C convertible preferred stock and all collateralized security interest were released. In connection with the extinguishment of the Bridge Loans, the Company reacquired the beneficial conversion feature. The intrinsic value of the beneficial conversion feature at the date of the Bridge Loans extinguishment was $3.9 million. This amount is reflected in additional paid in capital. The Company recorded a gain from the extinguishment of the debt in the amount of $2.0 million which is reflected in other income (expense), net in the consolidated statement of operations in the year ended December 31, 2014. During the year ended December 31, 2014, the Company recognized total interest expense of $3.9 million related to the Bridge Loans’ accrued interest and amortization of the debt discount. Convertible Notes On February 29, 2016, the Company issued and sold $100.0 million aggregate principal amount of its 8.2% Convertible Senior Notes (the “Convertible Notes”) and received total net proceeds of approximately $99.2 million, after deducting issuance costs of $0.8 million. The Convertible Notes constitute general, senior unsubordinated obligations of the Company and are guaranteed by certain subsidiaries of the Company. The Convertible Notes bear interest at a fixed coupon rate of 8.2% per annum payable quarterly in arrears on March 31, June 30, September 30 and December 31 of each year, which commenced on March 31, 2016, and mature on March 31, 2022, unless earlier converted, redeemed or repurchased. If the Company fails to satisfy certain registration or reporting requirements, then additional interest will accrue on the Convertible Notes at a rate of up to 0.50% per annum in the aggregate. The Convertible Notes also bear a premium of 9% of their principal amount, which is payable when the Convertible Notes mature or are repurchased or redeemed by the Company. The Convertible Notes were issued to Healthcare Royalty Partners III, L.P., for $75.0 million in aggregate principal amount, and to three related party investors, KKR Biosimilar L.P., MX II Associates LLC, and KMG Capital Partners, LLC, for $20.0 million, $4.0 million, and $1.0 million, respectively, in aggregate principal amount. The Convertible Notes are convertible at the option of the holder at any time prior to the close of business on the business day immediately preceding March 31, 2022 at the initial conversion rate of 44.7387 shares of common stock per $1,000 principal amount of Convertible Notes, which is equivalent to an initial conversion price of approximately $22.35 per share, and is subject to adjustment in certain events. Upon conversion of the Convertible Notes by a holder, the holder will receive shares of the Company’s common stock together, if applicable, with cash in lieu of any fractional share. The Convertible Notes are redeemable in whole, and not in part, at the Company’s option on or after March 31, 2020, if the last reported sale price per share of common stock exceeds 160% of the conversion price on 20 or more trading days during the 30 consecutive trading days preceding the date on which the Company sends notice of such redemption to the holders of the Convertible Notes. At maturity or redemption, if not earlier converted, the Company will pay 109% of the principal amount of the Convertible Notes maturing or being redeemed, together with accrued and unpaid interest, in cash. The Convertible Notes contain customary events of default (as defined in the Convertible Note purchase agreement), the occurrence of which could result in the acceleration of all amounts due under the Convertible Notes. These events of default include, among others, certain failures to pay amounts due on the Convertible Notes, to deliver the consideration due upon conversion or to settle uninsured judgments, decrees or orders exceeding $10.0 million, and certain defaults on other indebtedness for money borrowed of at least $10.0 million, insolvency-related events and breaches of representations, subject, in some cases, to a cure period. The Convertible Notes also contain covenants restricting the Company’s ability to incur additional indebtedness for borrowed money or convertible preferred stock and to pay dividends or make distributions on the Company’s equity interests, subject to certain exceptions. As of December 31, 2016, the Company was in full compliance with these covenants and there were no events of default under the Convertible Notes. The Convertible Notes are accounted for in accordance with ASC Subtopic 470-20, Debt with Conversion and Other Options The Company granted the holders of the Convertible Notes certain registration rights requiring the Company to register, under the Securities Act of 1933, as amended, the resale of the shares of common stock issuable upon conversion or settlement of the Convertible Notes. The following table summarizes information about the components of the Convertible Notes as of December 31, 2016 (in thousands): December 31, 2016 Principal amount of the Convertible Notes $ 81,750 Unamortized debt discount and debt issuance costs (6,558 ) Convertible Notes $ 75,192 Principal amount of the Convertible Notes - related parties $ 27,250 Unamortized debt discount and debt issuance costs - related parties (2,186 ) Convertible Notes - related parties $ 25,064 Total Convertible Notes $ 100,256 If the Convertible Notes were converted on December 31, 2016, the holders of the Convertible Notes would receive common shares with an aggregate value of $125.9 million based on the Company’s closing stock price of $28.15. The following table presents the components of interest expense of the Convertible Notes for the year ended December 31, 2016 (in thousands): Twelve Months Ended December 31, 2016 Stated coupon interest $ 5,159 Accretion of debt discount and debt issuance costs 781 Interest expense $ 5,940 Stated coupon interest - related parties $ 1,720 Accretion of debt discount and debt issuance costs - related parties 260 Interest expense - related parties $ 1,980 Total interest expense $ 7,920 The remaining unamortized debt discount and debt offering costs related to the Company’s Convertible Notes of approximately $8.7 million as of December 31, 2016, will be amortized using the effective interest rate over the remaining term of the Convertible Notes of 5.25 years. The annual effective interest rate is 9.48% for the Convertible Notes. During the year ended December 31, 2016, the Company recognized total interest expense of $7.9 million related to the Convertible Notes’ accrued interest and amortization of the debt discount. Future payments on the Convertible Notes as of December 31, 2016 are as follows (in thousands): Year ending December 31, 2017 $ 8,200 2018 8,200 2019 8,200 2020 8,200 2021 and thereafter 119,250 Total minimum payments 152,050 Less amount representing interest (43,050 ) Convertible Notes, principal amount 109,000 Less debt discount and debt issuance costs on Convertible Notes (8,744 ) Net carrying amount of Convertible Notes $ 100,256 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2016 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 8. Commitments and Contingencies Purchase Commitments The Company enters into contracts in the normal course of business with contract research organizations for preclinical studies and clinical trials and contract manufacturing organizations for the manufacture of drug materials. The contracts are cancellable, with varying provisions regarding termination. If a contract with a specific vendor were to be terminated, the Company would only be obligated for products or services that the Company had received as of the effective date of the termination and any applicable cancellation fees. Facility Leases The Company leases office spaces for its corporate headquarters in Redwood City, California and for laboratory facilities in Camarillo, California under operating lease agreements. On July 6, 2015, the Company entered into a new office lease (the “New Lease”) with Hudson 333 Twin Dolphin Plaza, LLC (the “Landlord”) to lease approximately 27,532 square feet of office space located in Redwood City, California (the “Premises”) for the Company’s new corporate headquarters. The Company leased office space located in Redwood City, California, pursuant to a lease dated September 26, 2011 (as amended, the “Current Lease”), which expired pursuant to the terms described below under “Amendment to Current Lease.” The New Lease commenced on December 1, 2015 and the Company moved into the new facility in December 2015. The Company entered into the Seventh Amendment to the Current Lease (the “Seventh Amendment”) with its current landlord when the New Lease was entered into. The Seventh Amendment provided early termination of the Current Lease which was effective in December 2015 when the New Leased commenced. The New Lease provided for annual base rent of approximately $1.6 million in the first year of the Lease Term, which increases on an annual basis up to approximately $1.9 million for the final year of the Lease Term. The New Lease also provided for certain limited rent abatements in the second year of the Lease Term. The Company will be entitled to a one-time improvement allowance of approximately $1.2 million for costs related to the design and construction of Company improvements that are permanently affixed to the Premises. In addition, the Company obtained a standby letter of credit (the “Letter of Credit”) in an amount of approximately $0.8 million, which may be drawn down by the Landlord to be applied for certain purposes upon the Company’s breach of any provisions under the New Lease. Provided that no default occurs under the terms of the New Lease, the Company will be entitled to periodically reduce the amount of the Letter of Credit down to approximately $0.3 million as of the last day of the sixtieth full calendar month of the Lease Term. The Company has recorded the $0.8 million Letter of Credit in restricted cash, non-current within its consolidated balance sheet at December 31, 2015. On September 21, 2016, the Company entered into the Second Amendment (the “Second Amendment”) to the New Lease to lease additional office space of approximately 12,809 square feet such that the total headquarters lease space is approximately 40,341 square feet (“Combined Lease Space”). The Second Amendment commenced on October 24, 2016, and ends on November 30, 2022, which coincides with the New Lease termination date. The Combined Lease Space contains a one-time option to extend the lease term for five years. The Second Amendment provides for annual base rent on the additional office space of approximately $0.8 million in the first year of the Second Amendment term, which increases on an annual basis up to approximately $0.9 million for the final year of the Second Amendment term and provides for certain limited rent abatements on the additional office space. The Company is also entitled to a one-time improvement allowance of approximately $0.2 million that can be applied towards specified items, including tenant improvement work and base rent. On December 27, 2016, the Company entered into the Third Amendment (the “Third Amendment”) to the Camarillo lease, the Company’s laboratory facilities, to extend the lease through June 30, 2019 resulting in two additional years of base rent totaling $279,000. In addition, the Third Amendment contains a one-time option to extend the Camarillo lease term for three years. Rent expense is recognized on a straight-line basis over the term of the leases and accordingly, the Company records the difference between cash rent payments and the recognition of rent expense as a deferred rent liability. The future minimum lease payments for all of the Company’s leased facilities as of December 31, 2016 are as follows (in thousands): Year ending December 31, 2017 $ 1,961 2018 2,601 2019 2,588 2020 2,595 2021 and thereafter 5,190 Total minimum lease payments $ 14,935 Rent expense was $1.7 million, $1.8 million and $0.8 million for the years ended December 31, 2016, 2015 and 2014, respectively. Guarantees and Indemnifications In the normal course of business, the Company enters into contracts and agreements that contain a variety of representations and warranties and provide for general indemnifications. The Company’s exposure under these agreements is unknown because it involves claims that may be made against the Company in the future, but have not yet been made. To date, the Company has not paid any claims or been required to defend any action related to its indemnification obligations. However, the Company may record charges in the future as a result of these indemnification obligations. The Company would assess the likelihood of any adverse judgments or related claims, as well as ranges of probable losses. In the cases where the Company believes that a reasonably possible or probable loss exists, it will disclose the facts and circumstances of the claims, including an estimate range, if possible. The Company is subject to one claim and consequently recorded a related liability of $50,000 in 2015. The claim was settled and agreed to by both parties in July 2016. |
Convertible Preferred Stock War
Convertible Preferred Stock Warrants | 12 Months Ended |
Dec. 31, 2016 | |
Temporary Equity Disclosure [Abstract] | |
Convertible Preferred Stock Warrants | 9. Convertible Preferred Stock Warrants In January 2011, in conjunction with the issuance of the 2011 convertible note agreements, the Company issued warrants to purchase shares of its newly authorized shares of preferred stock upon a financing event (“2011 Warrants A”). In March 2011, as a result of the Series A convertible preferred stock financing event, the 2011 Warrants A became exercisable warrants to purchase 63,923 shares of Series A convertible preferred stock with an exercise price of $1.2503 per share. From July to December 2011, the Company issued warrants with an exercise price of $0.0167 per share in conjunction with the issuance of the 2011 convertible note agreements (“2011 Warrants B”). In January 2012, as a result of the Series B convertible preferred stock financing event, the 2011 Warrants B became exercisable warrants to purchase 352,448 shares of Series B convertible preferred stock. Prior to the closing of the Company’s IPO in November 2014, all the outstanding 2011 Warrants A and 2011 Warrants B were exercised. From July to September 2013, the Company issued the 2013 Warrants with the exercise price of $0.0167 per share in conjunction with the issuance of the Bridge Loans (see Note 7). In December 2013, the 2013 Warrants became exercisable to purchase 4,279,620 shares of Series B convertible preferred stock, which were all exercised during April and May 2014. The 2011 Warrants A, 2011 Warrants B and 2013 Warrants were classified as convertible preferred stock warrant liabilities and subject to remeasurement at each balance sheet date. The fair value of the convertible preferred stock warrants was determined based on Level 3 inputs. During 2014, the warrants were valued using the Probability-Weighted Expected Return Method (“PWERM”) exclusively based on the expectation for an IPO in November 2014. The size of the IPO and the implied pre-money total equity values were used to support the warrants value. Generally, increases (decreases) in the fair value of the underlying preferred stock would result in a directionally similar impact to the fair value measurement. The change in the fair value of the convertible preferred stock warrant liability was recognized in other expense, net within the consolidated statements of operations. The net change in the fair value of the warrant liability was an increase of $15.9 million for the years ended December 31, 2014. The Company adjusted the liability for changes in fair value at the time of the exercise and then reclassified the liability to the respective series of preferred stock. Any remaining warrants outstanding immediately prior to the Company’s IPO in November 2014 were exercised, for cash or on a net basis, and the fair value of the warrants were recorded to the respective series of convertible preferred. |
Common Stock Warrants
Common Stock Warrants | 12 Months Ended |
Dec. 31, 2016 | |
Warrants And Rights Note Disclosure [Abstract] | |
Common Stock Warrants | 10. Common Stock Warrants In March 2014, the Company issued warrants to purchase 553,274 shares of common stock with the exercise price of $1.667 per share to two employees and one consultant for past services. The warrants were vested and exercisable upon issuance and would have expired at the earlier of: (i) March 28, 2024, (ii) an IPO or (iii) the consummation of a liquidation even. The grant date fair value per warrant share was $4.95 for employees and $5.42 for the consultant, resulting in warrant valuations of $2.6 million and $144,000 for the employees and consultant, respectively. Due to the immediate vesting and exercisability of the warrants upon issuance, the Company immediately recognized $1.3 million and $1.4 million of stock-based compensation in research and development expense and general and administrative expense, respectively, in the consolidated statement of operations. In November 2014, all of the warrants outstanding to purchase common stock were net exercised, which resulted in the issuance of 491,580 shares of common stock upon the closing of the IPO. |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) | 12 Months Ended |
Dec. 31, 2016 | |
Equity Method Investment Summarized Financial Information Liabilities And Equity [Abstract] | |
Stockholders' Equity (Deficit) | 11. Stockholders’ Equity (Deficit) Follow-on Offering In March 2015, the Company’s registration statement on Form S-1 (File No. 333-202936) relating to its follow-on offering of its common stock was declared effective by the SEC. The price of the shares sold in the follow-on offering was $29.00 per share. The follow-on offering closed on April 7, 2015, pursuant to which the Company sold 4,137,931 shares of common stock. The Company received total gross proceeds from the offering of $120.0 million. After deducting underwriting discounts and commissions of $7.2 million and offering expenses of $0.6 million, the net proceeds were $112.2 million. Private Placement with Baxalta On September 10, 2015, the Company completed a private placement and entered into a Purchase Agreement with Baxalta. Pursuant to the Purchase Agreement, the Company sold Baxalta an aggregate of 390,167 shares of common stock for aggregate gross proceeds of approximately $10 million. The purchase price for each share was $25.63, which was equal to the closing trading price of the Company's common stock on the NASDAQ Global Market on the day of pricing, September 9, 2015. The securities sold and issued in connection with the private placement are not registered under the Securities Act or any state securities laws and may not be offered or sold in the United States absent registration with the SEC or an applicable exemption from the registration requirements. In connection with the Purchase Agreement, the Company entered into a Registration Rights Agreement (the “Registration Rights Agreement”) with Baxalta GmbH. Pursuant to the Registration Rights Agreement, the Company filed a registration statement on Form S-3 (File No. 333-208625) with the SEC on December 18, 2015 for purposes of registering the resale of the shares. The Registration Statement on Form S-3 was declared effective by the SEC on January 21, 2016. Common Stock Offerings In January 2016, the Company’s shelf registration statement on Form S-3 (File No. 333-208625) (the “Shelf Registration Statement”) was declared effective by the SEC. In May and June 2016, the Company issued and sold 4,025,000 shares of common stock at a price of $18.00 per share. The Company received total gross proceeds from the offering of $72.5 million. After deducting underwriting discounts and commissions of $3.0 million and offering expense of $0.5 million, the net proceeds were $69.0 million. On October 28, 2016, the Company entered into a sales agreement (the “Sales Agreement”) with Cowen to sell shares of the Company’s common stock, with aggregate gross sales proceeds of up to $100,000,000, from time to time, through an at-the-market equity offering program under which Cowen will act as its sales agent (the “ATM Offering Program”). Cowen is entitled to compensation for its services equal to 3.0% of the gross proceeds of any shares of common stock sold through Cowen under the Sales Agreement. The Company has no obligation to sell any shares under the Sales Agreement, and may at any time suspend solicitation and offers under the Sales Agreement. The shares will be issued pursuant to the Company’s Shelf Registration Statement. The Company filed a prospectus supplement, dated October 28, 2016, with the SEC in connection with the offer and sale of the shares pursuant to the Sales Agreement. In November and December 2016, the Company sold 2,015,987 shares of common stock at a weighted average price of $28.04 per share through its ATM Offering Program and received total gross proceeds in 2016 of $56.5 million. After deducting commissions of $1.7 million and offering expenses of $0.2 million, the net proceeds were $54.6 million. |
Stock Option Plans and Stock-Ba
Stock Option Plans and Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock Option Plans and Stock-Based Compensation | 12. Stock Option Plans and Stock-Based Compensation Restricted Common Stock (“Founders Shares”) During 2010 and 2011, the Company issued shares of restricted common stock to its founders under our founders’ shares agreements (such shares, the “Founders’ Shares”). As of December 31, 2016, all shares were fully vested and there were no shares subject to repurchase. The Company recognized stock-based compensation expense within its consolidated statement of operations of $0, $9,000 and $1.6 million for the years ended December 31, 2016, 2015 and 2014, respectively, related to shares of common stock granted pursuant to the Founders’ Shares agreements. 2010 Stock Plan In 2010, the Company adopted the 2010 Stock Plan (the “2010 Plan”) and granted options under this plan until November 2014 which is when it was terminated as to future awards, although it continues to govern the terms of options that remain outstanding under the 2010 Plan. The 2010 Plan provided for the Company to grant shares and/or options to purchase shares of common stock to employees, directors, consultants, and other service providers at prices not less than the fair value at the date of grant for incentive stock options and nonstatutory options. These options were granted to generally vest over four years, expire ten years from the date of grant, and are generally exercisable after vesting. Unvested options exercised are subject to the Company’s repurchase right that lapses as the options vest. As of December 31, 2016 and 2015, no shares were subject to repurchase under the 2010 Plan. In November 2014, the board of directors adopted the Company’s 2014 Equity Incentive Award Plan (the “2014 Plan”) and any remaining unissued shares available under the 2010 Plan were transferred into the 2014 Plan. As such, no more options may be issued under the 2010 Plan. As of December 31, 2016, a total of 3,843,541 shares of common stock are subject to options outstanding under the 2010 plan, which shares will become available under the 2014 Plan to the extent the options are forfeited or lapse unexercised. 2014 Equity Incentive Award Plan In October 2014, the Company’s board of directors and its stockholders approved the establishment of the 2014 Equity Incentive Plan (the “2014 Plan”), effective upon the date upon which the registration statement for the IPO was declared effective, which was November 6, 2014. As of the date of the IPO, the Company reserved for issuance under the 2014 Plan a total of 2,300,000 shares of its common stock, plus any additional shares that would otherwise return to the 2010 Plan as a result of forfeiture, termination or expiration of awards previously granted under the 2010 Plan. In addition, the 2014 Plan provides for annual increases in the number of shares available for issuance thereunder on the first business day of each fiscal year, beginning with 2015, equal to four percent (4%) of the number of shares of the Company’s common stock outstanding as of such date or a lesser number of shares as determined by the Company’s board of directors. 2016 Employment Commencement Incentive Plan In June 2016, the Company adopted the 2016 Employment Commencement Incentive Plan (the “2016 Plan”). The 2016 Plan is designed to comply with the inducement exemption contained in Nasdaq’s Rule 5635(c)(4), which provides for the grant of non-qualified stock options, restricted stock units, restricted stock awards, performance awards, dividend equivalents, deferred stock awards, deferred stock units, stock payment and stock appreciation rights to a person not previously an employee or director of the Company, or following a bona fide period of non-employment, as an inducement material to the individual’s entering into employment with the Company. The Company reserved for future issuance under the 2016 Plan a total of 1,000,000 shares of its common stock for new employees. The 2016 Plan does not provide for any annual increases in the number of shares available. Employee Stock Purchase Plan In October 2014, the Company’s board of directors and its stockholders approved the establishment of the 2014 Employee Stock Purchase Plan (“ESPP”). The Company will reserve for issuance 320,000 shares of its common stock and provide for annual increases in the number of shares available for issuance on the first business day of each fiscal year, beginning with the Company’s fiscal year following the year of this offering, equal to the lesser of one percent (1%) of the number of shares of the Company’s common stock outstanding as of such date, 320,000 shares of common stock, or a number of shares as determined by the Company’s board of directors. As of December 31, 2016, the Company has not implemented the ESPP. The following table sets forth the summary of option activities under the 2016, 2014 and 2010 Plans: Options Outstanding Shares Available for Grant Number of Options Weighted-Average Exercise Balances at December 31, 2015 1,083,147 7,808,842 $ 12.898 Authorized 2,560,223 — — Granted - at fair value (3,481,090 ) 3,481,090 20.134 Exercised — (761,587 ) 4.349 Forfeited 378,209 (378,209 ) 23.235 Balances at December 31, 2016 540,489 10,150,136 $ 15.636 Additional information related to the status of options as of December 31, 2016 is summarized as follows: Number of Options Weighted- Average Exercise Price Weighted- Average Contractual Terms (Years) Aggregate Intrinsic Value (in thousands) Options outstanding 10,150,136 $ 15.636 8.03 $ 130,011 Options vested and expected to vest 10,066,985 $ 15.588 8.02 $ 129,426 Options vested and exercisable 4,511,193 $ 10.278 7.22 $ 81,458 Valuation of Awards Granted to Employees The Company estimated the fair value of each stock award on the date of grant using the Black-Scholes option-pricing model. The weighted average assumptions used to value options granted to employees under the Plan during the years ended December 31, 2016, 2015 and 2014 were as follows: Year Ended December 31, 2016 2015 2014 Expected term (years) 6.00 6.00 6.50 Expected volatility 75 % 78 % 99 % Risk-free interest rate 1.42 % 1.62 % 2.05 % Expected dividend yield 0 % 0 % 0 % Expected Term The expected term represents the period for which the stock-based awards are expected to be outstanding and is based on the options’ vesting term, contractual term and industry peers. Expected Volatility The Company used an average historical stock price volatility of industry peers as representative of future stock price volatility since the Company does not have any trading history for its common stock. Risk-Free Interest Rate The Company based the risk-free interest rate by using an equivalent to the expected term based on the U.S. Treasury constant maturity rate as of the date of grant. Expected Dividends The Company has not paid and does not anticipate paying any dividends in the near future, and therefore used an expected dividend yield of zero in the valuation model. The stock-based compensation expense recorded related to options granted to employees was as follows (in thousands): Year Ended December 31, 2016 2015 2014 Research and development $ 10,856 $ 6,460 $ 1,580 General and administrative 12,386 8,289 3,934 $ 23,242 $ 14,749 $ 5,514 During the years ended December 31, 2016, 2015 and 2014, the total estimated fair value of the options vested was $23.2 million, $14.6 million and $4.2 million, respectively and the estimated weighted-average grant-date fair value of options granted was $13.32, $18.42 and $6.65 per share, respectively. The aggregate intrinsic value of options exercised during the years ended December 31, 2016, 2015 and 2014 was $15.8 million, $22.4 million and $0.4 million, respectively. As of December 31, 2016, total unrecognized stock-based compensation expenses related to unvested employee stock options was $68.9 million, which is expected to be recognized on a straight-line basis over a weighted-average period of approximately 2.82 years. In November 2014, the Company entered into a separation agreement with its former CFO and granted accelerated vesting of options and extended the exercise period for those vested options. In connection with the option modification, the Company recognized stock-based compensation expense of $1.2 million to general and administrative expense in its consolidated statements of operations for the year ended December 31, 2014, which is included in the $3.9 million in the above stock-based compensation table. Nonemployees Stock-Based Compensation The Company granted 248,650, 198,750 and 113,913 stock options to purchase shares of common stock to nonemployees during the years ended December 31, 2016, 2015 and 2014. The weighted-average exercise price of the options granted in 2016, 2015 and 2014 was $18.16, $26.51 and $4.42 per share, respectively. For the years ended December 31, 2016, 2015 and 2014, the Company recorded stock-based compensation expense related to options granted to nonemployees of $4.2 million, $2.0 million and $1.3 million, respectively. The Company remeasures the fair value of the unvested nonemployee options at each period using the Black-Scholes option-pricing model reflecting the same assumptions as applied to employee options in each of the reported years, other than the expected life, which is assumed to be the remaining contractual life of the options. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 13. Income Taxes The Company utilizes the liability method of accounting for deferred income taxes. Under this method, deferred tax liabilities and assets are recognized for the expected future tax consequences of temporary differences between the carrying amounts and the tax basis of assets and liabilities. A valuation allowance is established against deferred tax assets because, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. The Company’s policy is to record interest and penalties on uncertain tax positions as income tax expense. The components of loss before income taxes are as follows (in thousands): Year Ended December 31, 2016 2015 2014 Domestic $ (95,776 ) $ (220,059 ) $ (86,927 ) Foreign (31,561 ) (3,201 ) (206 ) Total $ (127,337 ) $ (223,260 ) $ (87,133 ) There was no provision for income taxes for all years presented due to the establishment of a full valuation allowance against the Company’s deferred tax assets. A reconciliation of the statutory U.S. federal rate to the Company’s effective tax rate is as follows: Year Ended December 31, 2016 2015 2014 Percent of pre-tax income: U.S. federal statutory income tax rate 34.00 % 34.00 % 34.00 % State taxes, net of federal benefit 1.98 0.70 (1.65 ) Foreign rate differences (8.43 ) (0.49 ) (0.08 ) Permanent items (2.02 ) (1.25 ) (10.80 ) Research and development credit 8.38 2.46 3.11 InteKrin purchase price allocation — — 0.73 Other (0.13 ) 0.57 0.11 Change in valuation allowance (33.78 ) (35.99 ) (25.42 ) Effective income tax rate — % — % — % Significant components of the Company’s net deferred tax assets as of December 31, 2016 and 2015 consist of the following (in thousands): December 31, 2016 2015 Net operating loss carryforwards $ 136,854 $ 91,334 Research and development credits 26,172 12,980 Depreciation and amortization 645 778 Stock-based compensation 11,995 5,111 Other accruals 2,495 2,236 Deferred revenue 531 23,237 Gross deferred tax assets 178,692 135,676 In-process research and development (891 ) (891 ) Gross deferred tax liabilities (891 ) (891 ) Total net deferred tax asset 177,801 134,785 Less valuation allowance (177,801 ) (134,785 ) Net deferred tax assets $ — $ — The valuation allowance increased $43.0 million, $79.2 million and $22.1 million during the years ended December 31, 2016, 2015 and 2014, respectively. As of December 31, 2016, the Company had federal net operating loss carryforwards of approximately $425.6 million, which will start to expire beginning in 2031, and various state net operating loss carryforwards of approximately $115.9 million, which have various expiration dates beginning in 2031. Utilization of the net operating loss carryforwards and credits may be subject to a substantial annual limitation due to the ownership change limitations provided by Section 382 of the Internal Revenue Code of 1986, as amended, and similar state provisions. The annual limitation may result in the expiration of net operating losses and credits before utilization. As of December 31, 2016, the Company had federal research and development credit carryforwards of approximately $30.4 million, which will start to expire in 2031, and state research and development credit carryforwards of approximately $10.6 million, which can be carried forward indefinitely. In assessing the realizability of deferred tax assets, the Company considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which the temporary differences representing net future deductible amounts become deductible. Due to the Company’s history of losses, and lack of other positive evidence, the Company has determined that it is more likely than not that its net deferred tax assets will not be realized, and therefore, the net deferred tax assets are fully offset by a valuation allowance at December 31, 2016 and 2015. At December 31, 2016, the portion of the federal net operating loss carryforwards related to stock option deductions is approximately $31.9 million, which is not included in the Company’s gross or net deferred tax assets. Pursuant to ASC 718-740-25-10, the tax effect of the stock option benefit of approximately $10.8 million will be recorded to equity when they reduce cash taxes payable in the future. The Company files U.S, California, and other state income tax returns with varying statutes of limitations. The tax years from 2011 forward remain open to examination due to the carryover of unused net operating losses and tax credits. A reconciliation of the Company’s unrecognized tax benefits for the years ended December 31, 2016 and 2015 is as follows (in thousands): Year Ended December 31, 2016 2015 2014 Balance at beginning of year $ 10,605 $ 3,816 $ 749 Additions based on tax positions related to current year 6,111 3,633 861 Additions for tax positions of prior years 1,966 3,156 2,206 Balance at end of year $ 18,682 $ 10,605 $ 3,816 As of December 31, 2016 and 2015, the Company had approximately $18.7 million and $10.6 million, respectively, of unrecognized benefits, none of which would currently affect the Company’s effective tax rate if recognized due to the Company’s deferred tax assets being fully offset by a valuation allowance. The Company does not believe there will be any material changes in its unrecognized tax positions over the next twelve months. During the years ended December 31, 2016, 2015 and 2014, the Company did not recognize accrued interest and penalties related to unrecognized tax benefits. The Company anticipates approximately $6.4 million decrease in the amount of existing unrecognized tax benefits during the next 12 months as reductions for tax positions of prior years. |
Net Loss Per Share Attributable
Net Loss Per Share Attributable to Coherus | 12 Months Ended |
Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share Attributable to Coherus | 14. Net Loss Per Share Attributable to Coherus The following table sets forth the computation of the basic and diluted net loss per share attributable to Coherus (in thousands, except share and per share data): Years Ended December 31, 2016 2015 2014 Numerator: Net loss attributable to Coherus $ (127,337 ) $ (223,260 ) $ (87,133 ) Denominator: Weighted-average common shares outstanding 41,912,300 37,125,617 8,520,100 Less: weighted-average unvested common shares subject to repurchase (1) — (3,609 ) (333,571 ) Weighted-average number of shares used in computing net loss per share attributable to Coherus, basic and diluted 41,912,300 37,122,008 8,186,529 Net loss per share attributable to Coherus, basic and diluted $ (3.04 ) $ (6.01 ) $ (10.64 ) (1) Shares were excluded as such shares represent restricted common stock (founders’ shares) which is vesting contingently upon the holders’ continued services to the Company. The following outstanding dilutive potential shares have been excluded from the calculation of diluted net loss per share attributable to Coherus due to their anti-dilutive effect: Outstanding as of December 31, 2016 2015 2014 Stock options 10,150,136 7,808,842 5,770,307 Shares issuable upon conversion of Convertible Notes 4,473,871 — — Total 14,624,007 7,808,842 5,770,307 In addition, 358,384 shares of common stock contingently issuable upon the successful achievement of an objective associated with contingent consideration payable to former InteKrin stockholders have been excluded from the calculation of diluted net loss per share attributable to Coherus for the year ended December 31, 2014. On March 6, 2015, the contingent issuable shares were settled (see Note 3). |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 15. Related Party Transactions Daiichi Sankyo In January 2012, Company entered into a license agreement with Daiichi Sankyo (see Note 5), under which the Company issued 2,867,426 shares of Series B convertible preferred stock. As such, Daiichi Sankyo was deemed to be a related party by ownership of more than 10% of the Company’s equity. Upon the consummation of the Company’s IPO, Daiichi Sankyo’s ownership percentage decreased to less than 10% of the Company’s equity; therefore, as of November 2014, Daiichi Sankyo was no longer considered a related party. For the year ended December 31, 2014, the Company recognized related party transactions of $1.9 million as collaboration and license revenue–related party in the Company’s consolidated statements of operations. In addition, the Company recognized $7.1 million as a reduction of research and development expense related to the costs reimbursed by Daiichi Sankyo in the Company’s consolidated statements of operations for the year ended December 31, 2014. The consolidated statements of operations for the years ended December 31, 2016 and 2015 does not reflect any transactions with Daiichi Sankyo as related party. Transactions Associated with Cook In January and December 2012, the Company issued a total of 2,150,569 shares of Series B convertible preferred stock to Cook as consideration for past and future services. As such, Cook was deemed to be a related party by ownership of more than 10% of the Company’s equity. During the second quarter of 2014, Cook divested a majority of its shares of the Company’s Series B convertible preferred stock; therefore, as of December 31, 2014, Cook was no longer considered a related party. For the year ended December 31, 2014 the Company recognized $4.5 million of services rendered by Cook within research and development in the consolidated statement of operations. The consolidated statements of operations for the years ended December 31, 2016 and 2015 does not reflect any transactions with Cook as related party. Transactions Associated with Medpace Agreement One member of the Company’s board of directors is also the chief executive officer of Medpace Inc. (“Medpace”). As such, Medpace was deemed to be a related party. As of December 31, 2016, the Company had $3.7 million in prepaid assets (prepaid clinical and other–related parties), $2.2 million in current other assets, $0.9 million in accounts payable–related parties, and $3.5 million in accrued and other liabilities (accrued clinical–related parties), all reflected on the Company’s consolidated balance sheet associated with Medpace. As of December 31, 2015, the Company had $10.9 million in prepaid assets (prepaid clinical and other–related parties), $3.5 million in accounts payable–related parties, and $6.1 million in accrued and other liabilities (accrued clinical–related parties), all reflected on the Company’s consolidated balance sheet associated with Medpace. The Company recognized $34.6 million, $42.5 million and $24.1 million during years ended December 31, 2016, 2015 and 2014, respectively, for services rendered by Medpace within research and development expense in the consolidated statements of operations. Recruiting Services One member of the Company’s board of directors is a partner of a firm that provides recruiting services to the Company. As such, the recruiting services provided were deemed to be related party transactions. As of December 31, 2016 and 2015, there were no such related party balances in the Company’s consolidated balance sheets. The Company recorded in research and development expense in its consolidated statements of operations, $135,000, $258,000 and $241,000 for the years ended December 31, 2016, 2015 and 2014, respectively, for services rendered by the recruiting company. The Company recorded in general and administrative expense in its consolidated statements of operations, $178,000, $559,000 and $597,000 for the year ended December 31, 2016, 2015 and 2014, respectively, for services rendered by the recruiting company. Convertible Notes — Related Parties In the third quarter of 2013, the Company entered into Bridge Loans with certain investors, including existing stockholders, some members of the Company’s board of directors and their affiliated companies and some members of management, for a total aggregate amount of $10.0 million and issued the 2013 Warrants to purchase shares of the Company’s preferred stock at an exercise price of $0.0167 per share (see Note 9). In May 2014, the Company completed a preferred stock financing and contemporaneously the Bridge Loans and the related accrued interest were automatically converted into Series C preferred stock (see Note 7). For the year ended December 31, 2014, the Company recognized $2.7 million of interest expense related to the debt and the amortization of the debt discount in the Company’s consolidated statement of operations. In February 2016, the Company issued Convertible Notes to certain related parties (some companies affiliated with members of the Company’s board of directors), for an aggregate principal amount of $25.0 million (see Note 7 for related party disclosure). InteKrin Acquisition In February 2014, the Company completed the acquisition of the InteKrin for total consideration of $5.0 million (see Note 6). Mr. Dennis M. Lanfear, the chief executive officer of the Company, was the chairman of the board and acting president of InteKrin at the time of the acquisition. As such, the InteKrin acquisition was a related party transaction. Mr. Lanfear also owns 10% of the outstanding securities of InteKrin Russia, a majority owned subsidiary of InteKrin. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events | 16. Subsequent Events In January 2016, the Company’s Shelf Registration Statement was declared effective by the SEC (see Note 11). On October 28, 2016, the Company entered into a Sales Agreement with Cowen to sell shares of the Company’s common stock, from time to time, through an ATM Offering Program. In January 2017, the Company sold 148,827 shares of common stock at a weighted average price of $28.88 per share through its ATM Offering Program and received total gross proceeds in 2017 of $4.3 million. After deducting commissions of $0.1 million, the net proceeds were $4.2 million. In February and March 2017, the Company issued and sold 5,294,902 shares of common stock at a price of $24.25 per share. The Company received total gross proceeds from the offering of $128.4 million. After deducting underwriting discounts and commissions of $7.7 million and offering expense of $0.4 million, the net proceeds were $120.3 million. On March 3, 2017, Amgen Inc. and Amgen USA Inc. filed an action against the Company, KBI BioPharma Inc., the Company’s employee Howard S. Weiser and Does 1-20 in the Superior Court of the State of California, County of Ventura. The complaint alleges that the Company engaged in unfair competition and improperly solicited and hired certain former Amgen employees in order to acquire and access trade secrets and other confidential information belonging to Amgen. The complaint alleges (i) unfair competition under California Business and Professions Code Section 17200 et seq., (ii) misappropriation of trade secrets, (iii) breach of contract, (iv) violation of Penal Code Section 502, (v) breach of duty of loyalty, (vi) aiding and abetting breach of duty of loyalty and (vii) tortious interference with contract, and seeks injunctive relief and monetary damages. The Company is evaluating the potential impact of this matter. |
Supplementary Data - Quarterly
Supplementary Data - Quarterly Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Information | 17. Supplementary Data – Quarterly Financial Data (Unaudited) The following table presents certain unaudited consolidated quarterly financial information for each of the quarters ended December 31, 2016 and 2015: 2016 Quarter End (in thousands, except per share data) March 31 June 30 September 30 December 31 Total revenue (1) $ 12,359 $ 14,068 $ 162,835 $ 844 Total operating expenses 76,711 76,804 78,218 74,304 Net income (loss) (1) (65,538 ) (70,150 ) 83,844 (75,944 ) Net income (loss) attributable to Coherus (1) (65,388 ) (69,967 ) 83,939 (75,921 ) Net income (loss) per share attributable to Coherus (1): Basic (1.67 ) (1.72 ) 1.93 (1.71 ) Diluted (1.67 ) (1.72 ) 1.67 (1.71 ) 2015 Quarter End March 31 June 30 September 30 December 31 Total revenue $ 5,810 $ 6,866 $ 7,167 $ 10,198 Total operating expenses 42,558 65,761 78,384 62,405 Net loss (40,839 ) (59,034 ) (71,485 ) (52,580 ) Net loss attributable to Coherus (40,725 ) (58,810 ) (71,334 ) (52,391 ) Net loss per share attributable to Coherus, basic and diluted (1.22 ) (1.56 ) (1.86 ) (1.35 ) (1) In June 2016, Shire completed its acquisition of Baxalta and as part of its strategic portfolio review issued a termination notice of the Baxalta Agreement in its entirety on September 26, 2016. As such, the Company regained from Shire all development and commercial rights previously licensed under CHS-0214. There were no further contractual obligations. Therefore, the Company r ecognized the outstanding balances of deferred revenue and contingent liability to collaborator of $85.8 million and $76.7 million, respectively, as revenue in the three months ended September 30, 2016 (see Note 5), and resulted in net income and net income attributable to Coherus for the three months ended September 30, 2016. |
Basis of Presentation and Sum27
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Basis of Consolidation | Basis of Consolidation The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”). The accompanying consolidated financial statements include the accounts of Coherus and its wholly owned subsidiaries as of December 31, 2016: Coherus Intermediate Corp, Coherus Oncology, Inc., Orphonix, Inc., InteKrin Therapeutics Inc. (“InteKrin”), and InteKrin’s 82.5% majority owned subsidiary of InteKrin Russia. Unless otherwise specified, references to the Company are references to Coherus and its consolidated subsidiaries. All intercompany transactions and balances have been eliminated upon consolidation. |
Reclassification | Reclassification To maintain comparability among the periods presented, the Company reclassified certain prior period amounts to a separate line item that was not included in the prior period presentation. Within Note 4, Accrued Liabilities, in the Notes to the Consolidated Financial Statements for the year ended December 31, 2015, the Company reclassified amounts that were recorded within accrued professional and consulting fees to accrued other. The reclassification had no impact on the total current accrued liabilities for the periods presented. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts and disclosures reported in the financial statements. Management uses significant judgment when making estimates related to its stock-based compensation, valuation of deferred tax assets, impairment of goodwill and long-lived assets, the valuation of acquired intangible assets, clinical trial accruals, revenue recognition period, contingent consideration, convertible notes valuation, as well as certain accrued liabilities; and in prior years, common stock valuation, the valuations of the convertible preferred stock warrant liability and embedded derivative instruments. Management bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ from these estimates. |
Foreign Currency | Foreign Currency The functional currency of InteKrin Russia, which the Company acquired in February 2014, is the Russian Ruble. Accordingly, the financial statements of this subsidiary are translated into U.S. dollars using appropriate exchange rates. Unrealized gains or losses on translation are recognized in accumulated other comprehensive loss in the consolidated balance sheet. For the years ended December 31, 2016, 2015 and 2014, the foreign exchange gains and losses recorded in other expense, net in the consolidated statements of operations were a net loss of $53,000, a net loss of $386,000 and a net gain of $671,000, respectively. |
Segment Reporting and Customer Concentration | Segment Reporting and Customer Concentration The Company operates and manages its business as one reportable and operating segment, which is the business of developing and commercializing biosimilar products, and, as part of the InteKrin acquisition, small molecules (see Note 6). The Company’s chief executive officer, who is the chief operating decision maker, reviews financial information on an aggregate basis for purposes of allocating resources and evaluating financial performance. Long-lived assets are primarily maintained in the United States of America. The following table summarizes revenue by geographic region (in thousands): Year Ended December 31, 2016 2015 2014 United States $ 188,292 $ 27,802 $ 28,481 Rest of world 1,814 2,239 2,625 Total revenue $ 190,106 $ 30,041 $ 31,106 Customer Concentration Customers whose collaboration and license revenue accounted for 10% or more of total revenues were as follows: Year Ended December 31, 2016 2015 2014 Baxalta 99 % 93 % 92 % |
Deferred Offering Costs | Deferred Offering Costs Deferred offering costs, which primarily consist of direct incremental legal and accounting fee, are capitalized in other assets, non-current until the completion of the offering. These deferred offering costs will be reclassified to additional paid-in capital upon the closing of the offering. There was $137,000 in deferred offering costs capitalized as of December 31, 2015 and none capitalized as of December 31, 2016. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments with original maturities of 90 days or less at the date of purchase to be cash and cash equivalents. |
Restricted Cash | Restricted Cash Restricted cash consists of cash held in money market accounts with a bank. The restricted cash that is used as collateral against the Company’s corporate credit cards is classified as current and the restricted cash to cover the standby letter of credit issued for the Company’s landlord to drawdown on if the facility lease is breached, is classified as non-current (see Note 8). |
Concentration of Credit Risk | Concentration of Credit Risk The Company’s financial instruments that are exposed to concentration of credit risk consist primarily of cash and cash equivalents. The Company maintains its cash in bank accounts which at times exceed federally insured limits. The Company attempts to minimize the risks related to cash and cash equivalents by investing in money markets with a broad and diverse range of financial instruments. The investment portfolio is maintained in accordance with the Company’s investment policy, which defines allowable investments, specifies credit quality standards and limits the credit exposure of any single issuer. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Fair value accounting is applied for all financial assets and liabilities and non-financial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring basis. |
Property and Equipment | Property and Equipment Property and equipment are stated at cost less accumulated depreciation and amortization. Maintenance and repairs are charged to expense as incurred, and costs of improvements are capitalized. Depreciation and amortization is recognized using the straight-line method over the following estimated useful lives: Computer equipment and software 3 years Furniture and fixtures 5 years Machinery and equipment 5 years Leasehold improvements Shorter of lease term or useful life |
Impairment of Long Lived Assets and Acquired Intangible Asset | Impairment of Long Lived Assets and Acquired Intangible Asset The Company reviews long-lived assets, including property and equipment, and indefinite-lived intangible, for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable. An impairment loss would be recognized when the estimated undiscounted future cash flows expected to result from the use of the asset and its eventual disposition is less than its carrying amount. Impairment, if any, is measured as the amount by which the carrying amount of a long-lived asset exceeds its fair value. For the year ended December 31, 2015, the Company recorded a $382,000 impairment of property and equipment in research and development within the statement of operations. Acquired in-process research and development (“IPR&D”) represents the fair value assigned to research and development assets that have not reached technological feasibility. The Company reviews amounts capitalized as acquired IPR&D for impairment at least annually, and whenever events or changes in circumstances indicate that the carrying value of the assets might not be recoverable. If the carrying value of the acquired IPR&D exceeds its fair value, then the intangible asset is written-down to its fair value. As of December 31, 2016, there have been no such impairments. Once the product candidate derived from the indefinite-lived intangible asset has been developed and commercialized, the useful life will be determined, and the carrying value of the finite-lived asset will be amortized prospectively over that estimated useful life. Alternatively, if the product candidate is abandoned, the carrying value of the intangible will be charged to research and development expense. |
Goodwill | Goodwill Goodwill represents the excess of the purchase price over the fair value of the net tangible and intangible assets acquired. The Company tests goodwill for impairment at least annually or more frequently if events or changes in circumstances indicate that this asset may be impaired. The goodwill test is based on our single operating segment and reporting unit structure. The Company compares the fair value of its reporting unit to its carrying value. If the carrying value of the net assets assigned to the reporting unit exceeds the fair value of the reporting unit, then the Company would need to determine the implied fair value of the reporting unit’s goodwill. If the carrying value of the reporting unit’s goodwill exceeds its implied fair value, then the Company would record an impairment loss equal to the difference. N o goodwill impairment was identified through December 31, 2016. |
Convertible Preferred Stock Warrant Liability | Convertible Preferred Stock Warrant Liability The Company classified warrants exercisable for shares of the Company’s Series A and Series B convertible preferred stock as derivative liabilities and adjusted their carrying value to fair value at the end of each reporting period as long as such warrants were outstanding. At the end of each reporting period, changes in the fair value of the convertible preferred stock warrant liability during the period were recorded as a component of other expense, net, in the consolidated statements of operations. |
Derivative Liability | Derivative Liability The Company has a derivative liability related to the contingent consideration associated with the acquisition of InteKrin. There were two contingent payments payable upon the achievement of certain events: (i) the completion of the first dosing of a human subject in the first Phase 2 clinical trial for InteKrin, (“Earn-Out Payment”) and (ii) upon the execution of any license, sublicense, development, collaboration, joint venture, partnering or similar agreement between the Company and the third party (“Compound Transaction Payment”). The derivative related to the contingent consideration is accounted for as a liability and remeasured to fair value as of each balance sheet date and the related remeasurement adjustment is recognized as other income (expense), net in the consolidated statements of operations. The Company determined the fair value of the two contingent consideration scenarios (the Earn-Out Payment and the Compound Transaction Payment) using a probability-weighted discounted cash flow approach. A probability-weighted value was determined by summing the probability of achieving a contingent payment threshold by the respective contingent payments. The expected cash flows were discounted at a rate selected to capture the risk of achieving the contingent payment thresholds and earning the contingent payment. This risk is comprised of InteKrin’s continued development, a specific risk factor associated with meeting the contingent consideration threshold and related payout, and counterparty risk associated with the payment of the contingent consideration. |
Accrued Research and Development Expenses | Accrued Research and Development Expenses Clinical trial costs are a component of research and development expenses. The Company accrues and expenses clinical trial activities performed by third parties based upon actual work completed in accordance with agreements established with clinical research organizations and clinical sites. The Company determines the actual costs through monitoring patient enrollment, discussions with internal personnel and external service providers as to the progress or stage of completion of trials or services and the agreed-upon fee to be paid for such services. |
Revenue Recognition | Revenue Recognition The Company recognizes revenue when persuasive evidence of an arrangement exists; transfer of technology has been completed, services have been performed or products have been delivered; the fee is fixed and determinable; and collection is reasonably assured. For revenue agreements with multiple elements, the Company identifies the deliverables included within the agreement and evaluates which deliverables may represent separate units of accounting based on the achievement of certain criteria, including whether the delivered element has stand-alone value to the collaborator. Deliverables under the arrangement are a separate unit of accounting if (i) the delivered item has value to the customer on a standalone basis and (ii) if the arrangement includes a general right of return relative to the delivered item and delivery or performance of the undelivered items are considered probable and substantially within the Company’s control. The Company determines how to allocate arrangement consideration to identified units of accounting based on the selling price hierarchy provided under the relevant guidance. The selling price used for each unit of accounting is based on vendor-specific objective evidence, if available, third party evidence if vendor-specific objective evidence is not available or estimated selling price if neither vendor-specific nor third-party evidence is available. Management may be required to exercise considerable judgment in determining whether a deliverable is a separate unit of accounting and in estimating the selling prices of identified units of accounting under its agreements. Upfront payments received in connection with licenses of the Company’s technology rights are deferred if facts and circumstances dictate that the license does not have stand-alone value. Such payments are recognized as license revenue over the estimated period of performance that is generally consistent with the terms of the research and development obligations contained in the specific collaboration and license agreement. The Company regularly reviews the estimated period of performance based on the progress made under each arrangement. Amounts received as funding of research and development activities are recognized as revenue if the collaboration arrangement involves the sale of the Company’s research or development services. However, such funding is recognized as a reduction in research and development expense when the Company engages in a research and development project jointly with another entity, with both entities participating in project activities and sharing costs and potential benefits of the arrangement. Payments that are contingent upon the achievement of a substantive milestone are recognized in their entirety in the period in which the milestone is achieved, assuming all other revenue recognition criteria are met. A milestones is defined as an event that can only be achieved based on the Company’s performance where there is substantive uncertainty about whether the event will be achieved at the inception of the arrangement. Events that are contingent only on the passage of time or only on counterparty performance are not considered milestones under accounting guidance. The Company’s evaluation includes an assessment of whether (a) the consideration is commensurate with either (1) the Company’s performance to achieve the milestone, or (2) the enhancement of the value of the delivered item(s) as a result of a specific outcome resulting from the Company’s performance to achieve the milestone, (b) the consideration relates solely to past performance and (c) the consideration is reasonable relative to all of the deliverables and payment terms within the arrangement. The Company evaluates factors such as the scientific, regulatory, commercial and other risks that must be overcome to achieve the respective milestone, the level of effort and investment required to achieve the respective milestone and whether the milestone consideration is reasonable relative to all deliverables and payment terms in the arrangement in making this assessment. Other contingent payments in which a portion of the payment is refundable or adjusts based on future performance or non-performance (e.g., through a penalty or claw-back provision) are not considered to relate solely to the Company’s past performance, and therefore, not considered substantive. Non-substantive contingent payments are classified as deferred revenue if they are ultimately expected to result in revenue recognition. The Company recognizes non-substantive contingent payments over the remaining estimated period of performance once the specific objective is achieved. Any portion of the non-substantive contingent payments which may be required to be refunded to the collaborator are not included in deferred revenue and instead are reflected as contingent liability to collaborator on the consolidated balance sheets. Contingent payments associated with the achievement of specific objectives in certain contracts that are not considered substantive because the Company does not contribute effort to the achievement of such milestones are recognized as revenue upon achievement of the objective, as long as there are no undelivered elements remaining and no continuing performance obligations by the Company, assuming all other revenue recognition criteria are met. Revenue from a government contract is recognized in the period during which the related costs are incurred and the related services are rendered, provided that the funds received are not refundable and applicable conditions under the government contract have been met. Funds received in advance are recorded as deferred revenue. |
Research and Development Expense | Research and Development Expenses Research and development costs are charged to expenses as incurred. Research and development expenses include, among other costs, salaries and other personnel-related costs, consultant fees, preclinical costs, cost to manufacture drug candidates and clinical trial costs and supplies, laboratory supplies costs and facility-related costs. Costs incurred under agreements with third parties are charged to expense as incurred in accordance with the specific contractual performance terms of such agreements. Costs of third parties include costs associated with manufacturing drug candidates, preclinical and clinical support activities. In certain cases, amounts received as reimbursement of research and development activities from the Company’s collaborators are recognized as a reduction in research and development expense when the Company engages in a research and development project jointly with another party, with both parties incurring costs while actively participating in project activities and both parties sharing costs and potential benefits of the arrangement. Costs incurred under the arrangements where the Company provides research services approximate the amount of revenues recorded. Advance payments for goods or services to be received in the future to be utilized in research and development activities are deferred and capitalized. The capitalized amounts are expensed as the related goods are delivered or the services are received. |
Share-Based Compensation | Stock-Based Compensation The Company measures the cost of equity-based service awards based on the grant-date fair value of the award, and recognizes the cost of such awards straight-line over the vesting period. Because non-cash stock compensation expense is based on awards ultimately expected to vest, it is reduced by an estimate for future forfeitures. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from estimates. The Company accounts for equity instruments issued to nonemployees using the fair value approach. These equity instruments consist of stock options and restricted common stock, which are valued using the Black-Scholes option-pricing model. Stock-based compensation expense is recognized as the equity instruments are earned. The measurement of stock-based compensation is subject to periodic adjustments as the underlying equity instruments vest. The Company utilizes the Black-Scholes option-pricing model for estimating fair value of its stock options and restricted stock granted. Option valuation models, including the Black-Scholes option-pricing model, require the input of highly subjective assumptions, and changes in the assumptions used can materially affect the grant-date fair value of an award. These assumptions include the risk-free rate of interest, expected dividend yield, expected volatility, the expected life of the award, and estimated forfeitures. |
Income Taxes | Income Taxes The Company uses the liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial reporting and the tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company must then assess the likelihood that the resulting deferred tax assets will be realized. A valuation allowance is provided when it is more likely than not that some portion or all of a deferred tax asset will not be realized. Due to the Company’s lack of earnings history, the net deferred tax assets have been fully offset by a valuation allowance. The Company recognizes uncertain income tax positions at the largest amount that is more likely than not to be sustained upon audit by the relevant taxing authority. An uncertain income tax position will not be recognized if it has less than a 50% likelihood of being sustained. The Company does not expect its unrecognized tax benefits to change significantly over the next twelve months. The Company’s policy is to recognize interest and/or penalties related to income tax matters in income tax expense. The Company had accrued no amounts for interest and penalties related to income tax matters in the Company’s consolidated balance sheets at December 31, 2016 and 2015. The Company utilizes the liability method of accounting for deferred income taxes. Under this method, deferred tax liabilities and assets are recognized for the expected future tax consequences of temporary differences between the carrying amounts and the tax basis of assets and liabilities. A valuation allowance is established against deferred tax assets because, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. The Company’s policy is to record interest and penalties on uncertain tax positions as income tax expense. |
Comprehensive Loss | Comprehensive Loss Comprehensive loss is composed of two components: net loss and other comprehensive loss. Other comprehensive loss refers to gains and losses that under U.S. GAAP are recorded as an element of stockholders’ equity, but are excluded from net loss. The Company’s other comprehensive loss included foreign currency translation adjustments for the years ended December 31, 2016, 2015 and 2014. |
Net Loss per Share Attributable to Coherus | Net Loss per Share Attributable to Coherus Basic net loss per share attributable to Coherus is calculated by dividing the net loss attributable to Coherus by the weighted-average number of shares of common stock outstanding for the period, without consideration for potential dilutive common shares. Since the Company was in a loss position for all periods presented, basic net loss per share attributable to Coherus is the same as diluted net loss per share attributable to Coherus as the inclusion of all potential dilutive common shares would have been anti-dilutive for all periods presented. Shares of founders’ common stock subject to repurchase are excluded from the calculation of weighted average shares as the vesting of such shares is contingent upon continued services being rendered by such holders. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers Revenue from Contracts with Customers Principal versus Agent Considerations Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients The new revenue standard permits two methods of adoption: retrospectively to each prior reporting period presented (full retrospective method), or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (the modified retrospective method). The Company plans to adopt the standard in the first quarter of 2018 using the modified retrospective method. The Company has evaluated its contracts and assessed that the license agreement with Daiichi Sankyo (see Note 5) is the only contract that would be impacted by the new revenue standard, and the Company is currently evaluating the materiality that this contract may have on its consolidated financial statements and related disclosures. In August 2014, the FASB issued ASU No. 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern In January 2016, the FASB issued ASU No. 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities. all annual and interim reporting periods thereafter. E In February 2016, the FASB issued ASU No. 2016-02, Leases In March 2016, the FASB issued ASU No. 2016-09, Compensation-Stock Compensation: Improvements to Employee Share-Based Payment Accounting In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows: Classification of Certain Cash Receipts and Cash Payments In October 2016, the FASB issued ASU No. 2016-16, Income Taxes: Intra-Entity Transfers of Assets Other Than Inventory In January 2017, the FASB issued ASU No. 2017-04, Intangibles-Goodwill and Other: Simplifying the Test for Goodwill Impairment As of January 1, 2016, the Company adopted ASU 2015-03, Simplifying the Presentation of Debt Issuance Costs The Company has reviewed other recent accounting pronouncements and concluded they are either not applicable to the business or that no material effect is expected on the consolidated financial statements as a result of future adoption. |
Fair Value Measurements | Financial assets and liabilities are recorded at fair value. The carrying amounts of certain of the Company’s financial instruments, including cash and cash equivalents, accounts receivable, accounts payable and other current liabilities approximate their fair value due to their short maturities. Fair value is 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. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The accounting guidance describes a fair value hierarchy based on three levels of inputs that may be used to measure fair value, of which the first two are considered observable and the last is considered unobservable. These levels of inputs are the following: Level 1 — Quoted prices in active markets for identical assets or liabilities. Level 2 — Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The Company’s financial instruments consist of Level 1 assets and Level 3 liabilities. Where quoted prices are available in an active market, securities are classified as Level 1. Level 1 assets consist of highly liquid money market funds that are included in cash and cash equivalents, and restricted cash. There were no unrealized gains and losses in the Company’s investments in these money market funds. In certain cases where there is limited activity or less transparency around inputs to valuation, securities are classified as Level 3. Level 3 liabilities consist of the contingent consideration. |
Basis of Presentation and Sum28
Basis of Presentation and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Summary of Revenue by Geographical Region | The following table summarizes revenue by geographic region (in thousands): Year Ended December 31, 2016 2015 2014 United States $ 188,292 $ 27,802 $ 28,481 Rest of world 1,814 2,239 2,625 Total revenue $ 190,106 $ 30,041 $ 31,106 |
Summary of Customers Revenue Accounted for 10% or More of Total Revenue | Customers whose collaboration and license revenue accounted for 10% or more of total revenues were as follows: Year Ended December 31, 2016 2015 2014 Baxalta 99 % 93 % 92 % |
Schedule of Estimated Useful Lives of Property Plant and Equipment | Property and equipment are stated at cost less accumulated depreciation and amortization. Maintenance and repairs are charged to expense as incurred, and costs of improvements are capitalized. Depreciation and amortization is recognized using the straight-line method over the following estimated useful lives: Computer equipment and software 3 years Furniture and fixtures 5 years Machinery and equipment 5 years Leasehold improvements Shorter of lease term or useful life |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Financial Assets and Liabilities Measured on a Recurring Basis | Financial assets and liabilities subject to fair value measurements on a recurring basis and the level of inputs used in such measurements are as follows (in thousands): Fair Value Measurements December 31, 2016 Total Level 1 Level 2 Level 3 Assets: Money market funds $ 104,240 $ 104,240 $ — $ — Restricted cash (money market funds) 845 845 — — Total financial assets $ 105,085 $ 105,085 $ — $ — Liabilities: Contingent consideration $ 5,550 $ — $ — $ 5,550 Fair Value Measurements December 31, 2015 Total Level 1 Level 2 Level 3 Assets: Money market funds $ 157,784 $ 157,784 $ — $ — Restricted cash (money market funds) 845 845 — — Total financial assets $ 158,629 $ 158,629 $ — $ — Liabilities: Contingent consideration $ 1,245 $ — $ — $ 1,245 |
Summary of Changes in the Estimated Fair Value of Contingent Consideration | The following table sets forth a summary of changes in the estimated fair value of the contingent consideration (in thousands): Balance as of February 12, 2014 (acquisition date) $ 1,310 Change in fair value of the contingent consideration liability 5,185 Balance as of December 31, 2014 6,495 Change in fair value of the contingent consideration liability 4,599 Fair value of Earn-Out Payment settled in common stock on March 6, 2015 (9,849 ) Balance as of December 31, 2015 1,245 Change in fair value of the contingent consideration liability 4,305 Balance as of December 31, 2016 $ 5,550 |
Balance Sheet Components (Table
Balance Sheet Components (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Schedule of Prepaid Assets | Prepaid assets are as follows (in thousands): December 31, December 31, 2016 2015 Prepaid clinical and other - related parties (see Note 15) $ 3,714 $ 10,901 Prepaid clinical, material and manufacturing 25,095 21,191 Prepaid other 2,825 2,651 Prepaid assets $ 31,634 $ 34,743 |
Schedule of Property and Equipment, Net | Property and equipment, net are as follows (in thousands): December 31, December 31, 2016 2015 Machinery and equipment $ 10,294 $ 7,809 Computer equipment and software 1,500 1,276 Furniture and fixtures 682 596 Leasehold improvements 4,322 4,343 Total property and equipment 16,798 14,024 Accumulated depreciation and amortization (6,026 ) (3,520 ) Property and equipment, net $ 10,772 $ 10,504 |
Schedule of Accrued Liabilities | Accrued liabilities are as follows (in thousands): December 31, December 31, 2016 2015 Accrued clinical - related parties (see Note 15) $ 3,542 $ 6,122 Accrued clinical and manufacturing 16,039 11,681 Accrued compensation 6,945 4,666 Accrued other 1,496 1,664 Accrued liabilities $ 28,022 $ 24,133 |
Collaboration and License Agr31
Collaboration and License Agreement (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Collaboration And License Agreements [Abstract] | |
Schedule of Revenue Related to Collaboration and License Agreements | The Company recognized revenue related to the collaboration and license agreements for the periods presented as follows (in thousands): Year Ended December 31, 2016 2015 2014 Baxalta $ 188,292 $ 27,802 $ 28,481 Daiichi Sankyo - related party (1) 1,184 2,239 1,893 Total collaboration and license revenue $ 189,476 $ 30,041 $ 30,374 (1) Represents revenue from Daiichi Sankyo through November 12, 2014 as a related party, a holder of more than 10% of our common stock until the closing of our initial public offering (“IPO”). |
Debt Obligations (Tables)
Debt Obligations (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |
Components of Convertible Notes | The following table summarizes information about the components of the Convertible Notes as of December 31, 2016 (in thousands): December 31, 2016 Principal amount of the Convertible Notes $ 81,750 Unamortized debt discount and debt issuance costs (6,558 ) Convertible Notes $ 75,192 Principal amount of the Convertible Notes - related parties $ 27,250 Unamortized debt discount and debt issuance costs - related parties (2,186 ) Convertible Notes - related parties $ 25,064 Total Convertible Notes $ 100,256 |
Components of Interest Expense of Convertible Notes | The following table presents the components of interest expense of the Convertible Notes for the year ended December 31, 2016 (in thousands): Twelve Months Ended December 31, 2016 Stated coupon interest $ 5,159 Accretion of debt discount and debt issuance costs 781 Interest expense $ 5,940 Stated coupon interest - related parties $ 1,720 Accretion of debt discount and debt issuance costs - related parties 260 Interest expense - related parties $ 1,980 Total interest expense $ 7,920 |
Schedule of Future Payments on the Convertible Notes | Future payments on the Convertible Notes as of December 31, 2016 are as follows (in thousands): Year ending December 31, 2017 $ 8,200 2018 8,200 2019 8,200 2020 8,200 2021 and thereafter 119,250 Total minimum payments 152,050 Less amount representing interest (43,050 ) Convertible Notes, principal amount 109,000 Less debt discount and debt issuance costs on Convertible Notes (8,744 ) Net carrying amount of Convertible Notes $ 100,256 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Commitments And Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Lease Payments for all the Company's Leased Facilities | The future minimum lease payments for all of the Company’s leased facilities as of December 31, 2016 are as follows (in thousands): Year ending December 31, 2017 $ 1,961 2018 2,601 2019 2,588 2020 2,595 2021 and thereafter 5,190 Total minimum lease payments $ 14,935 |
Stock Option Plans and Stock-34
Stock Option Plans and Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Summary of Option Activities under 2016, 2014 and 2010 Plans | The following table sets forth the summary of option activities under the 2016, 2014 and 2010 Plans: Options Outstanding Shares Available for Grant Number of Options Weighted-Average Exercise Balances at December 31, 2015 1,083,147 7,808,842 $ 12.898 Authorized 2,560,223 — — Granted - at fair value (3,481,090 ) 3,481,090 20.134 Exercised — (761,587 ) 4.349 Forfeited 378,209 (378,209 ) 23.235 Balances at December 31, 2016 540,489 10,150,136 $ 15.636 |
Summary of Additional Information Related to Status of Options | Additional information related to the status of options as of December 31, 2016 is summarized as follows: Number of Options Weighted- Average Exercise Price Weighted- Average Contractual Terms (Years) Aggregate Intrinsic Value (in thousands) Options outstanding 10,150,136 $ 15.636 8.03 $ 130,011 Options vested and expected to vest 10,066,985 $ 15.588 8.02 $ 129,426 Options vested and exercisable 4,511,193 $ 10.278 7.22 $ 81,458 |
Schedule of Weighted Average Assumptions Used to Value Options Granted to Employees | The weighted average assumptions used to value options granted to employees under the Plan during the years ended December 31, 2016, 2015 and 2014 were as follows: Year Ended December 31, 2016 2015 2014 Expected term (years) 6.00 6.00 6.50 Expected volatility 75 % 78 % 99 % Risk-free interest rate 1.42 % 1.62 % 2.05 % Expected dividend yield 0 % 0 % 0 % |
Schedule of Stock-Based Compensation Expense | The stock-based compensation expense recorded related to options granted to employees was as follows (in thousands): Year Ended December 31, 2016 2015 2014 Research and development $ 10,856 $ 6,460 $ 1,580 General and administrative 12,386 8,289 3,934 $ 23,242 $ 14,749 $ 5,514 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Components of Loss Before Income Taxes | The components of loss before income taxes are as follows (in thousands): Year Ended December 31, 2016 2015 2014 Domestic $ (95,776 ) $ (220,059 ) $ (86,927 ) Foreign (31,561 ) (3,201 ) (206 ) Total $ (127,337 ) $ (223,260 ) $ (87,133 ) |
Reconciliation of Statutory U.S. Federal Rate | A reconciliation of the statutory U.S. federal rate to the Company’s effective tax rate is as follows: Year Ended December 31, 2016 2015 2014 Percent of pre-tax income: U.S. federal statutory income tax rate 34.00 % 34.00 % 34.00 % State taxes, net of federal benefit 1.98 0.70 (1.65 ) Foreign rate differences (8.43 ) (0.49 ) (0.08 ) Permanent items (2.02 ) (1.25 ) (10.80 ) Research and development credit 8.38 2.46 3.11 InteKrin purchase price allocation — — 0.73 Other (0.13 ) 0.57 0.11 Change in valuation allowance (33.78 ) (35.99 ) (25.42 ) Effective income tax rate — % — % — % |
Components of Net Deferred Tax Assets | Significant components of the Company’s net deferred tax assets as of December 31, 2016 and 2015 consist of the following (in thousands): December 31, 2016 2015 Net operating loss carryforwards $ 136,854 $ 91,334 Research and development credits 26,172 12,980 Depreciation and amortization 645 778 Stock-based compensation 11,995 5,111 Other accruals 2,495 2,236 Deferred revenue 531 23,237 Gross deferred tax assets 178,692 135,676 In-process research and development (891 ) (891 ) Gross deferred tax liabilities (891 ) (891 ) Total net deferred tax asset 177,801 134,785 Less valuation allowance (177,801 ) (134,785 ) Net deferred tax assets $ — $ — |
Reconciliation of Unrecognized Tax Benefits | A reconciliation of the Company’s unrecognized tax benefits for the years ended December 31, 2016 and 2015 is as follows (in thousands): Year Ended December 31, 2016 2015 2014 Balance at beginning of year $ 10,605 $ 3,816 $ 749 Additions based on tax positions related to current year 6,111 3,633 861 Additions for tax positions of prior years 1,966 3,156 2,206 Balance at end of year $ 18,682 $ 10,605 $ 3,816 |
Net Loss Per Share Attributab36
Net Loss Per Share Attributable to Coherus (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Net Loss Per Share Attributable to Coherus | The following table sets forth the computation of the basic and diluted net loss per share attributable to Coherus (in thousands, except share and per share data): Years Ended December 31, 2016 2015 2014 Numerator: Net loss attributable to Coherus $ (127,337 ) $ (223,260 ) $ (87,133 ) Denominator: Weighted-average common shares outstanding 41,912,300 37,125,617 8,520,100 Less: weighted-average unvested common shares subject to repurchase (1) — (3,609 ) (333,571 ) Weighted-average number of shares used in computing net loss per share attributable to Coherus, basic and diluted 41,912,300 37,122,008 8,186,529 Net loss per share attributable to Coherus, basic and diluted $ (3.04 ) $ (6.01 ) $ (10.64 ) (1) Shares were excluded as such shares represent restricted common stock (founders’ shares) which is vesting contingently upon the holders’ continued services to the Company. |
Outstanding Dilutive Potential Shares Excluded from Calculation of Diluted Net Loss Per Share Attributable to Coherus | The following outstanding dilutive potential shares have been excluded from the calculation of diluted net loss per share attributable to Coherus due to their anti-dilutive effect: Outstanding as of December 31, 2016 2015 2014 Stock options 10,150,136 7,808,842 5,770,307 Shares issuable upon conversion of Convertible Notes 4,473,871 — — Total 14,624,007 7,808,842 5,770,307 |
Supplementary Data - Quarterl37
Supplementary Data - Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Financial Information | The following table presents certain unaudited consolidated quarterly financial information for each of the quarters ended December 31, 2016 and 2015: 2016 Quarter End (in thousands, except per share data) March 31 June 30 September 30 December 31 Total revenue (1) $ 12,359 $ 14,068 $ 162,835 $ 844 Total operating expenses 76,711 76,804 78,218 74,304 Net income (loss) (1) (65,538 ) (70,150 ) 83,844 (75,944 ) Net income (loss) attributable to Coherus (1) (65,388 ) (69,967 ) 83,939 (75,921 ) Net income (loss) per share attributable to Coherus (1): Basic (1.67 ) (1.72 ) 1.93 (1.71 ) Diluted (1.67 ) (1.72 ) 1.67 (1.71 ) 2015 Quarter End March 31 June 30 September 30 December 31 Total revenue $ 5,810 $ 6,866 $ 7,167 $ 10,198 Total operating expenses 42,558 65,761 78,384 62,405 Net loss (40,839 ) (59,034 ) (71,485 ) (52,580 ) Net loss attributable to Coherus (40,725 ) (58,810 ) (71,334 ) (52,391 ) Net loss per share attributable to Coherus, basic and diluted (1.22 ) (1.56 ) (1.86 ) (1.35 ) (1) In June 2016, Shire completed its acquisition of Baxalta and as part of its strategic portfolio review issued a termination notice of the Baxalta Agreement in its entirety on September 26, 2016. As such, the Company regained from Shire all development and commercial rights previously licensed under CHS-0214. There were no further contractual obligations. Therefore, the Company r ecognized the outstanding balances of deferred revenue and contingent liability to collaborator of $85.8 million and $76.7 million, respectively, as revenue in the three months ended September 30, 2016 (see Note 5), and resulted in net income and net income attributable to Coherus for the three months ended September 30, 2016. |
Organization and Operations - A
Organization and Operations - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 2 Months Ended | |||||
Jan. 31, 2017 | Mar. 31, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Organization And Operations [Line Items] | |||||||
Accumulated deficit | $ 537,322 | $ 409,985 | |||||
Cash and cash equivalents | $ 124,947 | $ 158,226 | $ 150,392 | $ 39,554 | |||
Common stock, shares issued and sold | 4,025,000 | ||||||
Share price | $ 18 | ||||||
Common stock, net proceeds | $ 69,000 | ||||||
At-the-Market Equity Offering Program | Subsequent Event | |||||||
Organization And Operations [Line Items] | |||||||
Common stock, shares issued and sold | 148,827 | 5,294,902 | |||||
Share price | $ 28.88 | $ 24.25 | |||||
Common stock, net proceeds | $ 4,200 | $ 120,300 |
Basis of Presentation and Sum39
Basis of Presentation and Summary of Significant Accounting Policies - Additional Information (Details) | 12 Months Ended | ||
Dec. 31, 2016USD ($)Segments | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items] | |||
Foreign exchange gain (loss) | $ (53,000) | $ (386,000) | $ 671,000 |
Number of reportable segment | Segments | 1 | ||
Number of operating segments | Segments | 1 | ||
Deferred offering costs | $ 0 | 137,000 | |
Income tax examination, description | less than a 50% | ||
Unrecognized tax benefits, interest and penalties accrued related to income tax matters | $ 0 | 0 | |
InteKrin Therapeutics Inc | |||
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items] | |||
Impairment of goodwill | 0 | ||
InteKrin Therapeutics Inc | In Process Research and Development | |||
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items] | |||
Impairment of property and equipment | $ 382,000 | ||
Impairment of intangible assets excluding goodwill | $ 0 | ||
RUSSIA | Coherus Intermediate Corp, InteKrin Therapeutics, Inc. | |||
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items] | |||
Controlling interest, ownership percentage by parent | 82.50% |
Basis of Presentation and Sum40
Basis of Presentation and Summary of Significant Accounting Policies - Summary of Revenue by Geographical Region (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2016 | [1] | Sep. 30, 2016 | [1] | Jun. 30, 2016 | [1] | Mar. 31, 2016 | [1] | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Revenues From External Customers And Long Lived Assets [Line Items] | |||||||||||||||
Total revenue | $ 844 | $ 162,835 | $ 14,068 | $ 12,359 | $ 10,198 | $ 7,167 | $ 6,866 | $ 5,810 | $ 190,106 | $ 30,041 | $ 31,106 | ||||
United States | |||||||||||||||
Revenues From External Customers And Long Lived Assets [Line Items] | |||||||||||||||
Total revenue | 188,292 | 27,802 | 28,481 | ||||||||||||
Rest of World | |||||||||||||||
Revenues From External Customers And Long Lived Assets [Line Items] | |||||||||||||||
Total revenue | $ 1,814 | $ 2,239 | $ 2,625 | ||||||||||||
[1] | In June 2016, Shire completed its acquisition of Baxalta and as part of its strategic portfolio review issued a termination notice of the Baxalta Agreement in its entirety on September 26, 2016. As such, the Company regained from Shire all development and commercial rights previously licensed under CHS-0214. There were no further contractual obligations. Therefore, the Company recognized the outstanding balances of deferred revenue and contingent liability to collaborator of $85.8 million and $76.7 million, respectively, as revenue in the three months ended September 30, 2016 (see Note 5), and resulted in net income and net income attributable to Coherus for the three months ended September 30, 2016. |
Basis of Presentation and Sum41
Basis of Presentation and Summary of Significant Accounting Policies - Summary of Customers Revenue Accounted for 10% or More of Total Revenue (Details) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Collaboration and License Revenue | Customer Concentration Risk | Baxalta | |||
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items] | |||
Percentage of total revenues by single customer | 99.00% | 93.00% | 92.00% |
Basis of Presentation and Sum42
Basis of Presentation and Summary of Significant Accounting Policies - Schedule of Estimated Useful Lives of Property Plant and Equipment (Details) | 12 Months Ended |
Dec. 31, 2016 | |
Computer Equipment and Software | |
Property Plant And Equipment [Line Items] | |
Estimated useful lives | 3 years |
Furniture and Fixtures | |
Property Plant And Equipment [Line Items] | |
Estimated useful lives | 5 years |
Machinery and Equipment | |
Property Plant And Equipment [Line Items] | |
Estimated useful lives | 5 years |
Leasehold Improvements | |
Property Plant And Equipment [Line Items] | |
Estimated useful lives, description | Shorter of lease term or useful life |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) - USD ($) | Feb. 29, 2016 | Mar. 06, 2015 | Jan. 08, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Feb. 12, 2014 |
Fair Value Disclosures [Line Items] | |||||||
Transfers from Level 1 to Level 3 | $ 0 | $ 0 | |||||
Transfers from Level 3 to Level 1 | 0 | 0 | |||||
Other expense, net | 3,877,000 | 4,838,000 | $ 18,595,000 | ||||
Remeasurement of fair-value contingent consideration | 4,305,000 | 4,599,000 | 5,185,000 | ||||
8.2% Senior Convertible Notes Due 2022 | |||||||
Fair Value Disclosures [Line Items] | |||||||
Aggregate principal amount | $ 100,000,000 | ||||||
Convertible notes, interest rate | 8.20% | ||||||
Debt instrument maturity date | Mar. 31, 2022 | ||||||
Other Expense, Net | |||||||
Fair Value Disclosures [Line Items] | |||||||
Remeasurement of fair-value contingent consideration | 4,300,000 | 460,000 | 235,000 | ||||
InteKrin Therapeutics Inc | |||||||
Fair Value Disclosures [Line Items] | |||||||
Business acquisition, number of shares issued | 358,384 | ||||||
Business acquisition, share price | $ 27.48 | ||||||
Business acquisition, cash payment | $ 1,000 | $ 1,485 | |||||
Business acquisition, value of shares issued | 9,800,000 | ||||||
Additional fair value of earn-out payment to other expense | $ 4,100,000 | ||||||
Other expense, net | 4,100,000 | 5,000,000 | |||||
Contingent Consideration | |||||||
Fair Value Disclosures [Line Items] | |||||||
Financial liabilities | 5,550,000 | $ 1,245,000 | $ 6,495,000 | $ 1,310,000 | |||
Level 3 | 8.2% Senior Convertible Notes Due 2022 | |||||||
Fair Value Disclosures [Line Items] | |||||||
Debt instrument fair value | $ 168,500,000 | ||||||
Level 3 | Long-Term Debt | Convertible Debt | |||||||
Fair Value Disclosures [Line Items] | |||||||
Fair value assumption, volatility rate | 60.00% | ||||||
Level 3 | Long-Term Debt | Straight Debt | |||||||
Fair Value Disclosures [Line Items] | |||||||
Discount rate | 13.60% | ||||||
Fair Value Measurements Recurring Basis | Level 3 | Contingent Consideration | |||||||
Fair Value Disclosures [Line Items] | |||||||
Expected probability of earn-out payment occurrence | 98.00% | ||||||
Discount rate | 25.00% | 25.00% | |||||
Counterparty credit risk given the cash payment | 8.00% | 6.00% | |||||
Expected probability of compound transaction payment occurrence | 33.00% | 10.00% | |||||
Increase (decrease) in expected probability of compound transaction payment occurrence | 1.00% | ||||||
Estimated fair value fluctuation of Compound Transaction Payment | $ 200,000 | ||||||
Fair Value Measurements Recurring Basis | Money Market Funds | Level 1 | |||||||
Fair Value Disclosures [Line Items] | |||||||
Unrealized gains and losses on investments | $ 0 |
Fair Value Measurements - Finan
Fair Value Measurements - Financial Assets and Liabilities Measured on a Recurring Basis (Details) - Fair Value Measurements Recurring Basis - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total financial assets | $ 105,085 | $ 158,629 |
Contingent Consideration | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total financial liabilities | 5,550 | 1,245 |
Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total financial assets | 105,085 | 158,629 |
Level 3 | Contingent Consideration | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total financial liabilities | 5,550 | 1,245 |
Money Market Funds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total financial assets | 104,240 | 157,784 |
Money Market Funds | Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total financial assets | 104,240 | 157,784 |
Restricted Cash (Money Market Funds) | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total financial assets | 845 | 845 |
Restricted Cash (Money Market Funds) | Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total financial assets | $ 845 | $ 845 |
Fair Value Measurements - Summa
Fair Value Measurements - Summary of Changes in the Estimated Fair Value of Contingent Consideration (Details) - USD ($) $ in Thousands | 11 Months Ended | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | |
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||
Fair value of Earn-Out Payment settled in common stock on March 6, 2015 | $ (9,849) | ||
Contingent Consideration | |||
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | |||
Beginning balance | $ 1,310 | $ 1,245 | 6,495 |
Change in fair value of the contingent consideration liability | 5,185 | 4,305 | 4,599 |
Fair value of Earn-Out Payment settled in common stock on March 6, 2015 | (9,849) | ||
Ending balance | $ 6,495 | $ 5,550 | $ 1,245 |
Balance Sheet Components - Sche
Balance Sheet Components - Schedule of Prepaid Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Schedule Of Prepaid Assets [Line Items] | ||
Prepaid assets | $ 31,634 | $ 34,743 |
Prepaid Clinical and Other Related Parties | ||
Schedule Of Prepaid Assets [Line Items] | ||
Prepaid assets | 3,714 | 10,901 |
Prepaid Clinical, Material and Manufacturing | ||
Schedule Of Prepaid Assets [Line Items] | ||
Prepaid assets | 25,095 | 21,191 |
Prepaid Other | ||
Schedule Of Prepaid Assets [Line Items] | ||
Prepaid assets | $ 2,825 | $ 2,651 |
Balance Sheet Components - Sc47
Balance Sheet Components - Schedule of Property and Equipment, Net (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Property Plant And Equipment [Line Items] | ||
Total property and equipment | $ 16,798 | $ 14,024 |
Accumulated depreciation and amortization | (6,026) | (3,520) |
Property and equipment, net | 10,772 | 10,504 |
Machinery and Equipment | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment | 10,294 | 7,809 |
Computer Equipment and Software | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment | 1,500 | 1,276 |
Furniture and Fixtures | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment | 682 | 596 |
Leasehold Improvements | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment | $ 4,322 | $ 4,343 |
Balance Sheet Components - Addi
Balance Sheet Components - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Property Plant And Equipment [Abstract] | |||
Depreciation and amortization | $ 2,996 | $ 1,869 | $ 674 |
Balance Sheet Components - Sc49
Balance Sheet Components - Schedule of Accrued Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Payables And Accruals [Abstract] | ||
Accrued clinical - related parties | $ 3,542 | $ 6,122 |
Accrued clinical and manufacturing | 16,039 | 11,681 |
Accrued compensation | 6,945 | 4,666 |
Accrued other | 1,496 | 1,664 |
Accrued liabilities | $ 28,022 | $ 24,133 |
Collaboration and License Agr50
Collaboration and License Agreement - Schedule of Revenue Related to Collaboration and License Agreements (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||
Collaboration and license revenue | $ 189,476 | $ 30,041 | $ 30,374 | |
Baxalta License Agreement | ||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||
Collaboration and license revenue | 188,292 | 27,802 | 28,481 | |
Daiichi Sankyo - Related Party | ||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||
Collaboration and license revenue | [1] | $ 1,184 | $ 2,239 | $ 1,893 |
[1] | Represents revenue from Daiichi Sankyo through November 12, 2014 as a related party, a holder of more than 10% of our common stock until the closing of our initial public offering (“IPO”). |
Collaboration and License Agr51
Collaboration and License Agreement - Schedule of Revenue Related to Collaboration and License Agreements (Parenthetical) (Details) | Nov. 12, 2014 |
Daiichi Sankyo - Related Party | |
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |
Percentage of equity interest held by related party, minimum | 10.00% |
Collaboration and License Agr52
Collaboration and License Agreement - Additional Information (Details) - USD ($) | Sep. 10, 2015 | Jun. 30, 2015 | Jun. 30, 2013 | Jan. 31, 2012 | Jun. 30, 2016 | Sep. 30, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Sep. 26, 2016 |
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||||||||
Proceeds from issuance of convertible preferred stock, net of issuance costs | $ 54,660,000 | |||||||||
Advance payments under license agreement | $ 1,070,000 | $ 1,330,000 | ||||||||
Deferred revenue, current | 892,000 | 49,621,000 | ||||||||
Deferred revenue, non-current | 669,000 | 45,338,000 | ||||||||
Common stock, shares issued and sold | 4,025,000 | |||||||||
Issuance price per share of convertible preferred stock | $ 18 | |||||||||
Gross proceeds from issuance of common stock | $ 72,500,000 | |||||||||
Contingent liability to collaborator | 66,255,000 | |||||||||
Daiichi Sankyo License Agreement | ||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||||||||
Deferred revenue | $ 10,000,000 | $ 1,600,000 | 2,800,000 | |||||||
Initial term of agreement | 10 years | |||||||||
Renewal term of agreement | 3 years | |||||||||
Estimated period of performance upfront fee | 3 years | |||||||||
License agreement finalized period | 90 days | |||||||||
Percentage of budgeted cost, total | 33.00% | |||||||||
Percentage of cost of comparator drug | 100.00% | |||||||||
Minimum percentage of clinical trial cost | 20.00% | |||||||||
Advance payments under license agreement | $ 1,100,000 | 1,300,000 | ||||||||
Reimbursement of past cost incurred and to be incurred | 4,500,000 | |||||||||
Deferred revenue, current | 900,000 | 1,500,000 | ||||||||
Deferred revenue, non-current | 700,000 | 1,300,000 | ||||||||
Research and development | $ 9,700,000 | 16,100,000 | $ 7,100,000 | |||||||
Daiichi Sankyo License Agreement | Series B Convertible Preferred Stock | ||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||||||||
Convertible preferred stock, shares issued | 2,867,426 | |||||||||
Convertible preferred stock, par value | $ 6.9749 | |||||||||
Proceeds from issuance of convertible preferred stock, net of issuance costs | $ 18,100,000 | |||||||||
Daiichi Sankyo License Agreement | Convertible Preferred Stock | ||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||||||||
Convertible preferred stock | $ 18,100,000 | |||||||||
Baxalta License Agreement | ||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||||||||
Deferred revenue | 92,000,000 | |||||||||
Initial term of agreement | 10 years | |||||||||
Renewal term of agreement | 3 years | |||||||||
Deferred revenue, current | 48,000,000 | |||||||||
Deferred revenue, non-current | 44,000,000 | |||||||||
Business acquisition date | Jun. 3, 2016 | |||||||||
Expiration of license agreement | 2023-08 | |||||||||
Deferred revenue recognized | $ 85,800,000 | $ 85,800,000 | ||||||||
Collaboration Agreement Contingent Liability Noncurrent Recognized | $ 76,700,000 | 76,700,000 | ||||||||
Contractual obligations | $ 0 | $ 0 | ||||||||
Contingent liability to collaborator | $ 66,300,000 | |||||||||
Baxalta Second Amendment | Private Placement | ||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||||||||
Common stock, shares issued and sold | 390,167 | |||||||||
Issuance price per share of convertible preferred stock | $ 25.63 | |||||||||
Gross proceeds from issuance of common stock | $ 10,000,000 |
Acquisition of InteKrin Thera53
Acquisition of InteKrin Therapeutics, Inc. - Additional Information (Details) $ / shares in Units, RUB in Millions | Mar. 06, 2015USD ($)$ / sharesshares | Jan. 08, 2014USD ($)$ / sharesshares | Feb. 28, 2014USD ($) | Dec. 31, 2016USD ($)Agreementshares | Dec. 31, 2016RUBshares | Dec. 31, 2015RUB | Dec. 31, 2014USD ($) | Dec. 31, 2014RUB | Dec. 30, 2016RUB | Dec. 31, 2015USD ($) | Mar. 31, 2015RUB | Mar. 31, 2014RUB | Feb. 12, 2014USD ($) |
Business Acquisition [Line Items] | |||||||||||||
Number of contingent consideration for potential payments | Agreement | 2 | ||||||||||||
Contingent consideration, probability of completion | 75.00% | 75.00% | |||||||||||
Fair value inputs contingent probability | 7.50% | 7.50% | |||||||||||
Goodwill | $ 943,000 | $ 943,000 | |||||||||||
Maximum | Year One | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Percent of administrative fees received | 60.00% | 60.00% | |||||||||||
Minimum | Year Three | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Percent of administrative fees received | 10.00% | 10.00% | |||||||||||
Contingent Consideration Earn-out Payment | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Fair value of contingent consideration | $ 800,000 | ||||||||||||
Contingent Consideration Compound Transaction Payment | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Fair value of contingent consideration | $ 500,000 | ||||||||||||
Series B Convertible Preferred Stock | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Business acquisition, number of shares issued | shares | 358,384 | 358,384 | |||||||||||
InteKrin Therapeutics Inc | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Business acquisition, date of acquisition agreement | Jan. 8, 2014 | ||||||||||||
Business acquisition, description of acquired entity | All of the outstanding shares of InteKrin and its 82.5% majority owned subsidiary, InteKrin Russia | All of the outstanding shares of InteKrin and its 82.5% majority owned subsidiary, InteKrin Russia | |||||||||||
Business acquisition, effective date of acquisition | Feb. 12, 2014 | ||||||||||||
Business combination consideration transferred | $ 5,000,000 | $ 5,000,000 | |||||||||||
Business combination, reason for business combination | Additionally, the acquisition of InteKrin was a strategic transaction to obtain funding from new investors. | Additionally, the acquisition of InteKrin was a strategic transaction to obtain funding from new investors. | |||||||||||
Business acquisition, number of shares issued | shares | 358,384 | ||||||||||||
Business acquisition, cash payment | $ 1,000 | 1,485 | |||||||||||
Business acquisition, contingent consideration | $ 1,300,000 | ||||||||||||
Business acquisition, share price | $ / shares | $ 27.48 | ||||||||||||
Goodwill | $ 900,000 | ||||||||||||
Goodwill deductible for tax purposes | 0 | ||||||||||||
Impairment of goodwill | 0 | ||||||||||||
Government contract amount | $ 2,600,000 | RUB 147.9 | |||||||||||
Deferred revenue | RUB | 28 | RUB 27.6 | RUB 11.8 | RUB 12 | |||||||||
InteKrin Therapeutics Inc | Two Thousand Fourteen | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Government contract amount | RUB | 40 | ||||||||||||
InteKrin Therapeutics Inc | Two Thousand Fifteen | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Government contract amount | RUB | RUB 39.4 | ||||||||||||
InteKrin Therapeutics Inc | In Process Research and Development | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Estimated acquisition represents fair value | 2,600,000 | ||||||||||||
Impairment of intangible assets excluding goodwill | $ 0 | ||||||||||||
InteKrin Therapeutics Inc | Series B Convertible Preferred Stock | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Business acquisition, number of shares issued | shares | 716,645 | ||||||||||||
Business acquisition, value of shares issued | $ 2,700,000 | ||||||||||||
Business acquisition, fair value method | PWERM | PWERM | |||||||||||
InteKrin Therapeutics Inc | Series B Convertible Preferred Stock | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Business acquisition, number of shares issued | shares | 243,841 | ||||||||||||
Business acquisition, value of shares issued | $ 1,000,000 | ||||||||||||
InteKrin Therapeutics Inc | General and Administrative Expense | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Business acquisition costs, legal expenses | 134,000 | ||||||||||||
InteKrin Therapeutics Inc | Other Income | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Deferred revenue recognized | $ 630,000 | RUB 39.4 | $ 732,000 | RUB 40 | |||||||||
InteKrin Therapeutics Inc | PWERM | Series B Convertible Preferred Stock | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Business acquisition, share price | $ / shares | $ 3.8174 | ||||||||||||
Coherus Intermediate Corp, InteKrin Therapeutics, Inc. | RUSSIA | InteKrin Therapeutics Inc | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Controlling interest, ownership percentage by parent | 82.50% |
Debt Obligations - Additional I
Debt Obligations - Additional Information (Details) | Feb. 29, 2016USD ($)d$ / sharesshares | May 31, 2014USD ($)shares | Sep. 30, 2014$ / shares | Dec. 31, 2016USD ($)$ / sharesshares | Dec. 31, 2014USD ($)shares | Dec. 31, 2015shares | Sep. 30, 2013USD ($) |
Debt Instrument [Line Items] | |||||||
Preferred stock, shares issued | shares | 0 | 0 | |||||
Gains on extinguishment of debt | $ 2,048,000 | ||||||
Proceeds from issuance of convertible notes | $ 75,000,000 | ||||||
KKR Member | |||||||
Debt Instrument [Line Items] | |||||||
Aggregate principal amount | $ 20,000,000 | ||||||
MX II Member | |||||||
Debt Instrument [Line Items] | |||||||
Aggregate principal amount | 4,000,000 | ||||||
KMGCP Member | |||||||
Debt Instrument [Line Items] | |||||||
Aggregate principal amount | 1,000,000 | ||||||
HRP III Member | |||||||
Debt Instrument [Line Items] | |||||||
Aggregate principal amount | 75,000,000 | ||||||
8.2% Senior Convertible Notes Due 2022 | |||||||
Debt Instrument [Line Items] | |||||||
Aggregate principal amount | $ 100,000,000 | ||||||
Convertible notes, interest rate | 8.20% | ||||||
Debt instrument maturity date | Mar. 31, 2022 | ||||||
Total interest expense related to accrued interest and amortization of debt discount | $ 7,900,000 | ||||||
Proceeds from issuance of convertible notes | $ 99,200,000 | ||||||
Convertible notes, Issuance Cost | $ 800,000 | ||||||
Convertible notes, interest rate description | The Convertible Notes bear interest at a fixed coupon rate of 8.2% per annum payable quarterly in arrears on March 31, June 30, September 30 and December 31 of each year, which commenced on March 31, 2016 | ||||||
Convertible notes, premium percentage | 9.00% | ||||||
Common shares at conversion | shares | 44.7387 | ||||||
Conversion price per common share | $ / shares | $ 22.35 | ||||||
Principal amount of notes converted into shares | $ 1,000 | ||||||
Percentage of applicable conversion price | 160.00% | ||||||
Convertible trading days | d | 20 | ||||||
Convertible consecutive trading days | 30 days | ||||||
Percentage to pay in cash of the par value of notes | 109.00% | ||||||
Minimum order amount to be settled | $ 10,000,000 | ||||||
Minimum borrowings for indebtedness defaulters | $ 10,000,000 | ||||||
Convertible notes, covenant compliance | As of December 31, 2016, the Company was in full compliance with these covenants and there were no events of default under the Convertible Notes. | ||||||
Convertible notes, converted amount | $ 125,900,000 | ||||||
Closing stock, price per share | $ / shares | $ 28.15 | ||||||
Unamortized debt discount and debt issuance costs on Convertible Notes | $ 8,744,000 | ||||||
Amortized effective interest rate convertible notes period | 5 years 3 months | ||||||
Convertible notes, effective interest rate | 9.48% | ||||||
8.2% Senior Convertible Notes Due 2022 | Maximum | |||||||
Debt Instrument [Line Items] | |||||||
Additional interest to be accrued upon failure of registration or reporting requirements | 0.50% | ||||||
Series C Convertible Preferred Stock | |||||||
Debt Instrument [Line Items] | |||||||
Preferred stock, shares issued | shares | 5,488,892 | ||||||
Issuance of convertible preferred stock shares upon conversion of convertible promissory notes, Shares | shares | 1,058,089 | 1,058,089 | |||||
Convertible Preferred Stock | |||||||
Debt Instrument [Line Items] | |||||||
Warrant exercise price | $ / shares | $ 0.0167 | ||||||
Convertible Debt | |||||||
Debt Instrument [Line Items] | |||||||
Aggregate principal amount | $ 10,000,000 | ||||||
Convertible notes, interest rate | 8.00% | ||||||
Debt instrument maturity date | Jul. 15, 2014 | ||||||
Bridge Loan | |||||||
Debt Instrument [Line Items] | |||||||
Percentage on shares issuable to warrants | 300.00% | ||||||
Bridge loans and related accrued interest | $ 10,600,000 | ||||||
Intrinsic value on loans extinguishment | $ 3,900,000 | ||||||
Gains on extinguishment of debt | $ 2,000,000 | ||||||
Total interest expense related to accrued interest and amortization of debt discount | $ 3,900,000 |
Debt Obligations - Components o
Debt Obligations - Components of Convertible Notes (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Feb. 29, 2016 |
Debt Instrument [Line Items] | ||
Convertible Notes | $ 75,192 | |
Convertible Notes - related parties | 25,064 | |
8.2% Senior Convertible Notes Due 2022 | ||
Debt Instrument [Line Items] | ||
Principal amount of the Convertible Notes | $ 100,000 | |
Unamortized debt discount and debt issuance costs | (8,744) | |
Total Convertible Notes | 100,256 | |
8.2% Senior Convertible Notes Due 2022 | Related Party Debt | ||
Debt Instrument [Line Items] | ||
Principal amount of the Convertible Notes | 27,250 | |
Unamortized debt discount and debt issuance costs | (2,186) | |
Convertible Notes - related parties | 25,064 | |
8.2% Senior Convertible Notes Due 2022 | Parent Company | ||
Debt Instrument [Line Items] | ||
Principal amount of the Convertible Notes | 81,750 | |
Unamortized debt discount and debt issuance costs | (6,558) | |
Convertible Notes | $ 75,192 |
Debt Obligations - Components56
Debt Obligations - Components of Interest Expense of Convertible Notes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Debt Instrument [Line Items] | |||
Accretion of debt discount and debt issuance costs | $ 1,041 | $ (38) | $ 3,897 |
Interest expense | 1,980 | 0 | 2,687 |
Total interest expense | 7,980 | $ 33 | $ 3,900 |
8.2% Senior Convertible Notes Due 2022 | |||
Debt Instrument [Line Items] | |||
Interest expense | 7,900 | ||
Total interest expense | 7,920 | ||
8.2% Senior Convertible Notes Due 2022 | Related Party Debt | |||
Debt Instrument [Line Items] | |||
Stated coupon interest | 1,720 | ||
Accretion of debt discount and debt issuance costs | 260 | ||
Interest expense | 1,980 | ||
8.2% Senior Convertible Notes Due 2022 | Parent Company | |||
Debt Instrument [Line Items] | |||
Stated coupon interest | 5,159 | ||
Accretion of debt discount and debt issuance costs | 781 | ||
Interest expense | $ 5,940 |
Debt Obligations - Schedule of
Debt Obligations - Schedule of Future Payments on the Convertible Notes (Details) - 8.2% Senior Convertible Notes Due 2022 $ in Thousands | Dec. 31, 2016USD ($) |
Debt Instrument [Line Items] | |
2,017 | $ 8,200 |
2,018 | 8,200 |
2,019 | 8,200 |
2,020 | 8,200 |
2021 and thereafter | 119,250 |
Total minimum payments | 152,050 |
Less amount representing interest | (43,050) |
Convertible Notes, principal amount | 109,000 |
Less debt discount and debt issuance costs on Convertible Notes | (8,744) |
Net carrying amount of Convertible Notes | $ 100,256 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) | Dec. 27, 2016USD ($) | Sep. 21, 2016USD ($)ft² | Jul. 06, 2015USD ($)ft² | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) |
Purchase Commitment Excluding Longterm Commitment [Line Items] | ||||||
Area of office space leased | ft² | 40,341 | |||||
Current lease, leased date | Sep. 26, 2011 | |||||
Rent expense | $ 1,700,000 | $ 1,800,000 | $ 800,000 | |||
Guarantor liability | 50,000 | |||||
New Lease Agreement | ||||||
Purchase Commitment Excluding Longterm Commitment [Line Items] | ||||||
Lease Commencement Date | Dec. 1, 2015 | |||||
Annual base rent for the first year of additional term | $ 1,600,000 | |||||
One-time improvement allowance | 1,200,000 | |||||
New Lease Agreement | Letter of Credit | ||||||
Purchase Commitment Excluding Longterm Commitment [Line Items] | ||||||
Letter of credit amount | 800,000 | $ 800,000 | ||||
Letter of credit amount at the end of lease term | 300,000 | |||||
New Lease Agreement | Maximum | ||||||
Purchase Commitment Excluding Longterm Commitment [Line Items] | ||||||
Rent for the final year of additional term | $ 1,900,000 | |||||
New Lease Agreement | Hudson 333 Twin Dolphin Plaza, LLC | ||||||
Purchase Commitment Excluding Longterm Commitment [Line Items] | ||||||
Area of office space leased | ft² | 27,532 | |||||
Seventh Amendment to Current Lease | ||||||
Purchase Commitment Excluding Longterm Commitment [Line Items] | ||||||
Lease termination description | The Seventh Amendment provided early termination of the Current Lease which was effective in December 2015 when the New Leased commenced | |||||
Lease expiration date | Apr. 30, 2017 | |||||
Second Amendment Agreement | ||||||
Purchase Commitment Excluding Longterm Commitment [Line Items] | ||||||
Area of office space leased | ft² | 12,809 | |||||
Annual base rent for the first year of additional term | $ 800,000 | |||||
One-time improvement allowance | 200,000 | |||||
Second Amendment Agreement | Maximum | ||||||
Purchase Commitment Excluding Longterm Commitment [Line Items] | ||||||
Rent for the final year of additional term | $ 900,000 | |||||
Corporate Headquarters Lease | ||||||
Purchase Commitment Excluding Longterm Commitment [Line Items] | ||||||
Lease Commencement Date | Oct. 24, 2016 | |||||
Lease expiration date | Nov. 30, 2022 | |||||
Leases extended expiration period | 5 years | |||||
Third Amendment Agreement | ||||||
Purchase Commitment Excluding Longterm Commitment [Line Items] | ||||||
Lease expiration date | Jun. 30, 2019 | |||||
Leases extended expiration period | 3 years | |||||
Number of additional years of base rent | 2 years | |||||
Rent expense | $ 279,000 |
Commitments and Contingencies59
Commitments and Contingencies - Schedule of Future Minimum Lease Payments for all the Company's Leased Facilities (Details) $ in Thousands | Dec. 31, 2016USD ($) |
Commitments And Contingencies Disclosure [Abstract] | |
2,017 | $ 1,961 |
2,018 | 2,601 |
2,019 | 2,588 |
2,020 | 2,595 |
2021 and thereafter | 5,190 |
Total minimum lease payments | $ 14,935 |
Convertible Preferred Stock W60
Convertible Preferred Stock Warrants - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | |||||
Dec. 31, 2014 | May 31, 2014 | Sep. 30, 2013 | Jan. 31, 2012 | Dec. 31, 2011 | Mar. 31, 2011 | |
Class Of Stock [Line Items] | ||||||
Change in fair value of Warrant liability | $ 15.9 | |||||
2011 Warrants A | Series A Convertible Preferred Stock | ||||||
Class Of Stock [Line Items] | ||||||
Stock issued for warrant exercised | 63,923 | |||||
Convertible preferred stock conversion price | $ 1.2503 | |||||
Two Thousand And Eleven Warrants B | ||||||
Class Of Stock [Line Items] | ||||||
Warrant exercise price | $ 0.0167 | |||||
Two Thousand And Eleven Warrants B | Series B Convertible Preferred Stock | ||||||
Class Of Stock [Line Items] | ||||||
Stock issued for warrant exercised | 352,448 | |||||
2013 Warrants | Bridge Loan | ||||||
Class Of Stock [Line Items] | ||||||
Warrant exercise price | $ 0.0167 | |||||
2013 Warrants | Series B Convertible Preferred Stock | Bridge Loan | ||||||
Class Of Stock [Line Items] | ||||||
Stock issued for warrant exercised | 4,279,620 |
Common Stock Warrants - Additio
Common Stock Warrants - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | |
Mar. 31, 2014 | Nov. 12, 2014 | |
Common Stock | ||
Class Of Warrant Or Right [Line Items] | ||
Issued warrants to purchase shares of common stock | 553,274 | |
Common stock, exercise price | $ 1.667 | |
Common Stock | IPO | ||
Class Of Warrant Or Right [Line Items] | ||
Issued warrants to purchase shares of common stock | 491,580 | |
Warrant Issued For Past Services | Research and Development Expense | ||
Class Of Warrant Or Right [Line Items] | ||
Stock-based compensation expense | $ 1,300 | |
Warrant Issued For Past Services | General and Administrative Expense | ||
Class Of Warrant Or Right [Line Items] | ||
Stock-based compensation expense | $ 1,400 | |
Employee Warrants | ||
Class Of Warrant Or Right [Line Items] | ||
Common stock, per share value | $ 4.95 | |
Employee Warrants | Common Stock | ||
Class Of Warrant Or Right [Line Items] | ||
Initial fair value of the warrants | $ 2,600 | |
Consultant Warrants | ||
Class Of Warrant Or Right [Line Items] | ||
Common stock, per share value | $ 5.42 | |
Consultant Warrants | Common Stock | ||
Class Of Warrant Or Right [Line Items] | ||
Initial fair value of the warrants | $ 144 |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) - Additional Information (Details) - USD ($) | Oct. 28, 2016 | Sep. 10, 2015 | Apr. 07, 2015 | Dec. 31, 2016 | Jun. 30, 2016 |
Class Of Stock [Line Items] | |||||
Issuance price per share of convertible preferred stock | $ 18 | ||||
Common stock, shares issued and sold | 4,025,000 | ||||
Gross proceeds from issuance of common stock | $ 72,500,000 | ||||
Underwriting discounts and commissions | 3,000,000 | ||||
Offering expense | 500,000 | ||||
Common stock, net proceeds | $ 69,000,000 | ||||
Follow-On Public Offering | |||||
Class Of Stock [Line Items] | |||||
Issuance price per share of convertible preferred stock | $ 29 | ||||
Common stock, shares issued and sold | 4,137,931 | ||||
Gross proceeds from issuance of common stock | $ 120,000,000 | ||||
Underwriting discounts and commissions | 7,200,000 | ||||
Offering expense | 600,000 | ||||
Common stock, net proceeds | $ 112,200,000 | ||||
Private Placement | Baxalta Second Amendment | |||||
Class Of Stock [Line Items] | |||||
Issuance price per share of convertible preferred stock | $ 25.63 | ||||
Common stock, shares issued and sold | 390,167 | ||||
Gross proceeds from issuance of common stock | $ 10,000,000 | ||||
At-the-Market Equity Offering Program | Cowen and Company LLC | |||||
Class Of Stock [Line Items] | |||||
Issuance price per share of convertible preferred stock | $ 28.04 | ||||
Common stock, shares issued and sold | 2,015,987 | ||||
Gross proceeds from issuance of common stock | $ 56,500,000 | ||||
Underwriting discounts and commissions | 1,700,000 | ||||
Offering expense | 200,000 | ||||
Common stock, net proceeds | $ 54,600,000 | ||||
Maximum amount of sales that agent may sell in shares of its common stock | $ 100,000,000 | ||||
Percentage of gross sales proceeds of common stock payable as compensation | 3.00% |
Stock Option Plans and Stock-63
Stock Option Plans and Stock-Based Compensation - Additional Information (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |||
Oct. 31, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Jun. 30, 2016 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Options outstanding | 10,150,136 | 7,808,842 | |||
Expected dividend yield | $ 0 | ||||
Share based payment options vested | $ 23,200,000 | $ 14,600,000 | $ 4,200,000 | ||
Share based payment options grants, grant-date fair value | $ 13.32 | $ 18.42 | $ 6.65 | ||
Share based payment options exercises value | $ 15,800,000 | $ 22,400,000 | $ 400,000 | ||
Unrecognized stock-based compensation expenses related to stock options | $ 68,900,000 | ||||
Unrecognized share-based compensation related to stock options, period for recognition | 2 years 9 months 26 days | ||||
Share based payment options grants | 3,481,090 | ||||
Weighted-Average Exercise Price, Granted - at fair value | $ 20.134 | ||||
2010 Plan | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Unvested shares of common stock subject to repurchase | 0 | 0 | |||
Vesting period | 4 years | ||||
Options granted, expiration period | 10 years | ||||
Options outstanding | 3,843,541 | ||||
2014 Equity Incentive Award Plan | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Percentage of shares available for issuance | 4.00% | 4.00% | |||
Common stock reserved for future issuance | 2,300,000 | ||||
2016 Employment Commencement Incentive Plan | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Common stock reserved for future issuance | 1,000,000 | ||||
2014 Employee Stock Purchase Plan | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Common stock reserved for future issuance | 320,000 | ||||
2014 Employee Stock Purchase Plan | Minimum | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Percentage of shares reserve for issuance | 1.00% | ||||
Restricted Common Stock (Founders Shares) | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Unvested shares of common stock subject to repurchase | 0 | ||||
Stock-based compensation expense | $ 0 | $ 9,000 | 1,600,000 | ||
Employee Stock Option | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Stock-based compensation expense | 23,242,000 | 14,749,000 | 5,514,000 | ||
Employee Stock Option | General and Administrative Expense | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Stock-based compensation expense | 12,386,000 | 8,289,000 | 3,934,000 | ||
Employee Stock Option | Former CFO | General and Administrative Expense | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Stock-based compensation expense | 1,200,000 | ||||
Nonemployees Stock-Based Compensation | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Stock-based compensation expense | $ 4,200,000 | $ 2,000,000 | $ 1,300,000 | ||
Share based payment options grants | 248,650 | 198,750 | 113,913 | ||
Weighted-Average Exercise Price, Granted - at fair value | $ 18.16 | $ 26.51 | $ 4.42 |
Stock Option Plans and Stock-64
Stock Option Plans and Stock-Based Compensation - Summary of Option Activities under 2016, 2014 and 2010 Plans (Details) | 12 Months Ended |
Dec. 31, 2016$ / sharesshares | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Shares Available for Grant, Beginning balance | 1,083,147 |
Shares Available for Grant, Authorized | 2,560,223 |
Shares Available for Grant, Granted - at fair value | (3,481,090) |
Shares Available for Grant, Forfeited | 378,209 |
Shares Available for Grant, Ending balance | 540,489 |
Number of Options, Beginning balance | 7,808,842 |
Number of Options, Granted - at fair value | 3,481,090 |
Number of Options, Exercised | (761,587) |
Number of Options, Forfeited | (378,209) |
Number of Options, Ending balance | 10,150,136 |
Weighted-Average Exercise Price, Beginning balance | $ / shares | $ 12.898 |
Weighted-Average Exercise Price, Granted - at fair value | $ / shares | 20.134 |
Weighted-Average Exercise Price, Exercised | $ / shares | 4.349 |
Weighted-Average Exercise Price, Forfeited | $ / shares | 23.235 |
Weighted-Average Exercise Price, Ending balance | $ / shares | $ 15.636 |
Stock Option Plans and Stock-65
Stock Option Plans and Stock-Based Compensation - Summary of Additional Information Related to Status of Options (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ||
Options outstanding, Number of Options | 10,150,136 | 7,808,842 |
Options vested and expected to vest, Number of Options | 10,066,985 | |
Options vested and exercisable, Number of Options | 4,511,193 | |
Options outstanding, Weighted-Average Exercise Price | $ 15.636 | $ 12.898 |
Options vested and expected to vest, Weighted-Average Exercise Price | 15.588 | |
Options vested and exercisable, Weighted-Average Exercise Price | $ 10.278 | |
Options outstanding, Weighted-Average Contractual Terms | 8 years 11 days | |
Options vested and expected to vest, Weighted-Average Contractual Terms | 8 years 7 days | |
Options vested and exercisable, Weighted-Average Contractual Terms | 7 years 2 months 19 days | |
Options outstanding, Aggregate Intrinsic Value | $ 130,011 | |
Options vested and expected to vest, Aggregate Intrinsic Value | 129,426 | |
Options vested and exercisable, Aggregate Intrinsic Value | $ 81,458 |
Stock Option Plans and Stock-66
Stock Option Plans and Stock-Based Compensation - Schedule of Weighted Average Assumptions Used to Value Options Granted to Employees (Details) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |||
Expected term (years) | 6 years | 6 years | 6 years 6 months |
Expected volatility | 75.00% | 78.00% | 99.00% |
Risk-free interest rate | 1.42% | 1.62% | 2.05% |
Expected dividend yield | 0.00% | 0.00% | 0.00% |
Stock Option Plans and Stock-67
Stock Option Plans and Stock-Based Compensation - Schedule of Stock-Based Compensation Expense Related to Options (Details) - Employee Stock Option - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | |||
Stock-based compensation expense | $ 23,242 | $ 14,749 | $ 5,514 |
Research and Development Expense | |||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | |||
Stock-based compensation expense | 10,856 | 6,460 | 1,580 |
General and Administrative Expense | |||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | |||
Stock-based compensation expense | $ 12,386 | $ 8,289 | $ 3,934 |
Income Taxes - Components of Lo
Income Taxes - Components of Loss Before Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2016 | [1] | Sep. 30, 2016 | [1] | Jun. 30, 2016 | [1] | Mar. 31, 2016 | [1] | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Loss From Continuing Operations Before Income Taxes Minority Interest And Income Loss From Equity Method Investments [Abstract] | |||||||||||||||
Domestic | $ (95,776) | $ (220,059) | $ (86,927) | ||||||||||||
Foreign | (31,561) | (3,201) | (206) | ||||||||||||
Net loss attributable to Coherus | $ (75,921) | $ 83,939 | $ (69,967) | $ (65,388) | $ (52,391) | $ (71,334) | $ (58,810) | $ (40,725) | $ (127,337) | $ (223,260) | $ (87,133) | ||||
[1] | In June 2016, Shire completed its acquisition of Baxalta and as part of its strategic portfolio review issued a termination notice of the Baxalta Agreement in its entirety on September 26, 2016. As such, the Company regained from Shire all development and commercial rights previously licensed under CHS-0214. There were no further contractual obligations. Therefore, the Company recognized the outstanding balances of deferred revenue and contingent liability to collaborator of $85.8 million and $76.7 million, respectively, as revenue in the three months ended September 30, 2016 (see Note 5), and resulted in net income and net income attributable to Coherus for the three months ended September 30, 2016. |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Operating Loss Carryforwards [Line Items] | ||||
Provision for (benefit from) income taxes | $ 0 | $ 0 | $ 0 | |
Increase in valuation allowance | 43,000,000 | 79,200,000 | 22,100,000 | |
Tax effect of stock option benefit that will be recorded to equity | 10,800,000 | |||
Unrecognized tax benefits, accrued interest and penalties accrued | 0 | 0 | 0 | |
Unrecognized tax benefits | 18,682,000 | $ 10,605,000 | $ 3,816,000 | $ 749,000 |
Decrease in unrecognized tax benefits | 6,400,000 | |||
Federal | ||||
Operating Loss Carryforwards [Line Items] | ||||
Net operating loss carryforwards | $ 425,600,000 | |||
Net operating loss carryforwards expiration year | 2,031 | |||
Tax credit carryforwards | $ 30,400,000 | |||
Tax credit carryforwards expiration year | 2,031 | |||
Federal | Stock Options | ||||
Operating Loss Carryforwards [Line Items] | ||||
Net operating loss carryforwards | $ 31,900,000 | |||
State | ||||
Operating Loss Carryforwards [Line Items] | ||||
Net operating loss carryforwards | $ 115,900,000 | |||
Net operating loss carryforwards expiration year | 2,031 | |||
Tax credit carryforwards | $ 10,600,000 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Statutory U.S. Federal Rate (Details) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Percent of pre-tax income: | |||
U.S. federal statutory income tax rate | 34.00% | 34.00% | 34.00% |
State taxes, net of federal benefit | 1.98% | 0.70% | (1.65%) |
Foreign rate differences | (8.43%) | (0.49%) | (0.08%) |
Permanent items | (2.02%) | (1.25%) | (10.80%) |
Research and development credit | 8.38% | 2.46% | 3.11% |
InteKrin purchase price allocation | 0.73% | ||
Other | (0.13%) | 0.57% | 0.11% |
Change in valuation allowance | (33.78%) | (35.99%) | (25.42%) |
Effective income tax rate | 0.00% | 0.00% | 0.00% |
Income Taxes - Components of Ne
Income Taxes - Components of Net Deferred Tax Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Components Of Deferred Tax Assets [Abstract] | ||
Net operating loss carryforwards | $ 136,854 | $ 91,334 |
Research and development credits | 26,172 | 12,980 |
Depreciation and amortization | 645 | 778 |
Stock-based compensation | 11,995 | 5,111 |
Other accruals | 2,495 | 2,236 |
Deferred revenue | 531 | 23,237 |
Gross deferred tax assets | 178,692 | 135,676 |
In-process research and development | (891) | (891) |
Gross deferred tax liabilities | (891) | (891) |
Total net deferred tax asset | 177,801 | 134,785 |
Less valuation allowance | (177,801) | (134,785) |
Net deferred tax assets | $ 0 | $ 0 |
Income Taxes - Reconciliation72
Income Taxes - Reconciliation of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Reconciliation Of Unrecognized Tax Benefits Excluding Amounts Pertaining To Examined Tax Returns Roll Forward | |||
Balance at beginning of year | $ 10,605 | $ 3,816 | $ 749 |
Additions based on tax positions related to current year | 6,111 | 3,633 | 861 |
Additions for tax positions of prior years | 1,966 | 3,156 | 2,206 |
Balance at end of year | $ 18,682 | $ 10,605 | $ 3,816 |
Net Loss Per Share Attributab73
Net Loss Per Share Attributable to Coherus - Computation of Basic and Diluted Net Loss Per Share Attributable to Coherus (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2016 | [1] | Sep. 30, 2016 | [1] | Jun. 30, 2016 | [1] | Mar. 31, 2016 | [1] | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Numerator: | |||||||||||||||
Net loss attributable to Coherus | $ (75,921) | $ 83,939 | $ (69,967) | $ (65,388) | $ (52,391) | $ (71,334) | $ (58,810) | $ (40,725) | $ (127,337) | $ (223,260) | $ (87,133) | ||||
Denominator: | |||||||||||||||
Weighted-average common shares outstanding | 41,912,300 | 37,125,617 | 8,520,100 | ||||||||||||
Less: weighted-average unvested common shares subject to repurchase | (3,609) | (333,571) | |||||||||||||
Weighted-average number of shares used in computing net loss per share attributable to Coherus, basic and diluted | 41,912,300 | 37,122,008 | 8,186,529 | ||||||||||||
Net loss per share attributable to Coherus, basic and diluted | $ (1.35) | $ (1.86) | $ (1.56) | $ (1.22) | $ (3.04) | $ (6.01) | $ (10.64) | ||||||||
[1] | In June 2016, Shire completed its acquisition of Baxalta and as part of its strategic portfolio review issued a termination notice of the Baxalta Agreement in its entirety on September 26, 2016. As such, the Company regained from Shire all development and commercial rights previously licensed under CHS-0214. There were no further contractual obligations. Therefore, the Company recognized the outstanding balances of deferred revenue and contingent liability to collaborator of $85.8 million and $76.7 million, respectively, as revenue in the three months ended September 30, 2016 (see Note 5), and resulted in net income and net income attributable to Coherus for the three months ended September 30, 2016. |
Net Loss Per Share Attributab74
Net Loss Per Share Attributable to Coherus - Outstanding Dilutive Potential Shares Excluded from Calculation of Diluted Net Loss Per Share Attributable to Coherus (Details) - shares | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from the calculation of diluted net loss per share | 14,624,007 | 7,808,842 | 5,770,307 |
Stock Options | |||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from the calculation of diluted net loss per share | 10,150,136 | 7,808,842 | 5,770,307 |
Shares Issuable Upon Conversion of Convertible Notes | |||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from the calculation of diluted net loss per share | 4,473,871 |
Net Loss Per Share Attributab75
Net Loss Per Share Attributable to Coherus - Additional Information (Details) - shares | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from the calculation of diluted net loss per share | 14,624,007 | 7,808,842 | 5,770,307 |
Restricted Common Stock (Founders Shares) | |||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from the calculation of diluted net loss per share | 358,384 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) - USD ($) | Jan. 08, 2014 | Feb. 28, 2014 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Feb. 29, 2016 | Nov. 12, 2014 | Sep. 30, 2013 | Dec. 31, 2012 | Jan. 31, 2012 | |
Related Party Transaction [Line Items] | |||||||||||
Collaboration and license revenue | $ 189,476,000 | $ 30,041,000 | $ 30,374,000 | ||||||||
Research and development expense | 254,440,000 | 213,062,000 | 78,224,000 | ||||||||
Prepaid assets | 31,634,000 | 34,743,000 | |||||||||
Other assets, current | 2,986,000 | 2,797,000 | |||||||||
Accounts payable - related parties | 877,000 | 3,548,000 | |||||||||
General and administrative expenses from transactions with related party | 178,000 | 559,000 | 597,000 | ||||||||
Interest expense from transactions with related party | 1,980,000 | 0 | 2,687,000 | ||||||||
InteKrin Therapeutics Inc | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Business combination consideration transferred | $ 5,000,000 | $ 5,000,000 | |||||||||
Bridge Loan | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Interest expense from transactions with related party | 2,700,000 | ||||||||||
Daiichi Sankyo - Related Party | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Collaboration and license revenue | [1] | 1,184,000 | 2,239,000 | 1,893,000 | |||||||
Reduction of research and development expense | 7,100,000 | ||||||||||
Daiichi Sankyo - Related Party | Series B Convertible Preferred Stock | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Convertible preferred stock, shares issued | 2,867,426 | ||||||||||
Daiichi Sankyo - Related Party | Minimum | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Related party transaction ownership percentage | 10.00% | ||||||||||
Daiichi Sankyo - Related Party | Maximum | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Related party transaction ownership percentage | 10.00% | ||||||||||
Cook | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Research and development expense | 4,500,000 | ||||||||||
Cook | Series B Convertible Preferred Stock | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Convertible preferred stock, shares issued | 2,150,569 | 2,150,569 | |||||||||
Cook | Minimum | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Related party transaction ownership percentage | 10.00% | 10.00% | |||||||||
Medpace Inc | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Research and development expense | 34,600,000 | 42,500,000 | 24,100,000 | ||||||||
Other assets, current | 2,200,000 | ||||||||||
Accounts payable - related parties | 900,000 | 3,500,000 | |||||||||
Medpace Inc | Prepaid Clinical and Other Related Parties | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Prepaid assets | 3,700,000 | 10,900,000 | |||||||||
Medpace Inc | Accrued Clinical - Related Parties | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Accrued and other liabilities | 3,500,000 | 6,100,000 | |||||||||
Board of Directors | Recruiting Services | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Research and development expense | 135,000 | 258,000 | 241,000 | ||||||||
Related party balances | 0 | 0 | |||||||||
General and administrative expenses from transactions with related party | $ 178,000 | $ 559,000 | $ 597,000 | ||||||||
Investor | Bridge Loan | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Aggregate principal amount | $ 10,000,000 | ||||||||||
Warrant exercise price | $ 0.0167 | ||||||||||
Affiliated Entity | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Aggregate principal amount | $ 25,000,000 | ||||||||||
Chief Executive Officer | InteKrin Russia | InteKrin Therapeutics Inc | |||||||||||
Related Party Transaction [Line Items] | |||||||||||
Related party transaction ownership percentage | 10.00% | ||||||||||
[1] | Represents revenue from Daiichi Sankyo through November 12, 2014 as a related party, a holder of more than 10% of our common stock until the closing of our initial public offering (“IPO”). |
Subsequent Events - Additional
Subsequent Events - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 2 Months Ended | ||
Jan. 31, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Jun. 30, 2016 | |
Subsequent Event [Line Items] | ||||
Common stock, shares issued and sold | 4,025,000 | |||
Issuance price per share of convertible preferred stock | $ 18 | |||
Gross proceeds from issuance of common stock | $ 72.5 | |||
Underwriting discounts and commissions | 3 | |||
Common stock, net proceeds | 69 | |||
Offering expense | $ 0.5 | |||
At-the-Market Equity Offering Program | Cowen and Company LLC | ||||
Subsequent Event [Line Items] | ||||
Common stock, shares issued and sold | 2,015,987 | |||
Issuance price per share of convertible preferred stock | $ 28.04 | |||
Gross proceeds from issuance of common stock | $ 56.5 | |||
Underwriting discounts and commissions | 1.7 | |||
Common stock, net proceeds | 54.6 | |||
Offering expense | $ 0.2 | |||
Subsequent Event | At-the-Market Equity Offering Program | ||||
Subsequent Event [Line Items] | ||||
Common stock, shares issued and sold | 148,827 | 5,294,902 | ||
Issuance price per share of convertible preferred stock | $ 28.88 | $ 24.25 | ||
Gross proceeds from issuance of common stock | $ 128.4 | |||
Underwriting discounts and commissions | 7.7 | |||
Common stock, net proceeds | $ 4.2 | 120.3 | ||
Offering expense | $ 0.4 | |||
Subsequent Event | At-the-Market Equity Offering Program | Cowen and Company LLC | ||||
Subsequent Event [Line Items] | ||||
Common stock, shares issued and sold | 148,827 | |||
Issuance price per share of convertible preferred stock | $ 28.88 | |||
Gross proceeds from issuance of common stock | $ 4.3 | |||
Underwriting discounts and commissions | 0.1 | |||
Common stock, net proceeds | $ 4.2 |
Supplementary Data - Quarterl78
Supplementary Data - Quarterly Financial Data (Unaudited) - Schedule of Quarterly Financial Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||||||
Quarterly Financial Information Disclosure [Abstract] | ||||||||||||||||
Total revenue | $ 844 | [1] | $ 162,835 | [1] | $ 14,068 | [1] | $ 12,359 | [1] | $ 10,198 | $ 7,167 | $ 6,866 | $ 5,810 | $ 190,106 | $ 30,041 | $ 31,106 | |
Total operating expenses | 74,304 | 78,218 | 76,804 | 76,711 | 62,405 | 78,384 | 65,761 | 42,558 | 306,037 | 249,108 | 95,788 | |||||
Net income (loss) | (75,944) | [1] | 83,844 | [1] | (70,150) | [1] | (65,538) | [1] | (52,580) | (71,485) | (59,034) | (40,839) | (127,788) | (223,938) | (87,177) | |
Net loss attributable to Coherus | $ (75,921) | [1] | $ 83,939 | [1] | $ (69,967) | [1] | $ (65,388) | [1] | $ (52,391) | $ (71,334) | $ (58,810) | $ (40,725) | $ (127,337) | $ (223,260) | $ (87,133) | |
Net income (loss) per share attributable to Coherus: | ||||||||||||||||
Basic | [1] | $ (1.71) | $ 1.93 | $ (1.72) | $ (1.67) | |||||||||||
Diluted | [1] | $ (1.71) | $ 1.67 | $ (1.72) | $ (1.67) | |||||||||||
Net loss per share attributable to Coherus, basic and diluted | $ (1.35) | $ (1.86) | $ (1.56) | $ (1.22) | $ (3.04) | $ (6.01) | $ (10.64) | |||||||||
[1] | In June 2016, Shire completed its acquisition of Baxalta and as part of its strategic portfolio review issued a termination notice of the Baxalta Agreement in its entirety on September 26, 2016. As such, the Company regained from Shire all development and commercial rights previously licensed under CHS-0214. There were no further contractual obligations. Therefore, the Company recognized the outstanding balances of deferred revenue and contingent liability to collaborator of $85.8 million and $76.7 million, respectively, as revenue in the three months ended September 30, 2016 (see Note 5), and resulted in net income and net income attributable to Coherus for the three months ended September 30, 2016. |
Supplementary Data - Quarterl79
Supplementary Data - Quarterly Financial Data (Unaudited) - Schedule of Quarterly Financial Information (Parenthetical) (Details) - Baxalta License Agreement - USD ($) | 3 Months Ended | 12 Months Ended | |
Sep. 30, 2016 | Dec. 31, 2016 | Sep. 26, 2016 | |
Quarterly Financial Information [Line Items] | |||
Deferred revenue recognized | $ 85,800,000 | $ 85,800,000 | |
Collaboration agreement contingent liability noncurrent recognized | $ 76,700,000 | 76,700,000 | |
Contractual obligations | $ 0 | $ 0 |