Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Feb. 28, 2018 | Jun. 30, 2017 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2017 | ||
Document Fiscal Year Focus | 2,017 | ||
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 | 60,141,557 | ||
Entity Public Float | $ 495.7 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 126,911 | $ 124,947 |
Restricted cash | 60 | 60 |
Receivables from collaboration and license agreement | 1,859 | |
Prepaid assets (includes related parties of $908 and $3,714 as of December 31, 2017 and 2016, respectively) | 18,364 | 31,634 |
Other assets (includes related parties of $0 and $2,184 as of December 31, 2017 and 2016, respectively) | 142 | 2,986 |
Total current assets | 145,477 | 161,486 |
Property and equipment, net | 12,773 | 10,772 |
Intangible assets | 2,620 | 2,620 |
Goodwill | 943 | 943 |
Restricted cash, non-current | 785 | 785 |
Other assets, non-current | 13 | 1,879 |
Total assets | 162,611 | 178,485 |
Current liabilities: | ||
Accounts payable | 15,481 | 19,706 |
Accounts payable - related parties | 233 | 877 |
Accrued liabilities (includes related parties of $510 and $3,542 as of December 31, 2017 and 2016, respectively) | 9,050 | 28,022 |
Advance payments under license agreement | 1,070 | |
Deferred revenue | 892 | |
Contingent consideration | 3,290 | 5,550 |
Other liabilities | 341 | 259 |
Total current liabilities | 28,395 | 56,376 |
Deferred revenue, non-current | 669 | |
Convertible notes | 76,206 | 75,192 |
Convertible notes - related parties | 25,402 | 25,064 |
Other liabilities, non-current | 2,073 | 1,830 |
Total liabilities | 132,076 | 159,131 |
Commitments and contingencies (Note 7) | ||
Stockholders’ equity: | ||
Preferred stock, $0.0001 par value; Shares authorized: 5,000,000; Shares issued and outstanding: no shares at December 31, 2017 and 2016. | ||
Common stock, $0.0001 par value; Shares authorized: 300,000,000; Shares issued and outstanding: 59,840,467 and 45,808,163 at December 31, 2017 and 2016, respectively | 6 | 5 |
Additional paid-in capital | 808,060 | 558,474 |
Accumulated other comprehensive loss | (750) | (630) |
Accumulated deficit | (775,492) | (537,322) |
Total Coherus stockholders' equity | 31,824 | 20,527 |
Non-controlling interest | (1,289) | (1,173) |
Total stockholders' equity | 30,535 | 19,354 |
Total liabilities and stockholders’ equity | $ 162,611 | $ 178,485 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Statement Of Financial Position [Abstract] | ||
Prepaid assets, related parties | $ 908 | $ 3,714 |
Other assets, related parties | 0 | 2,184 |
Accrued liabilities, related parties | $ 510 | $ 3,542 |
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 | 59,840,467 | 45,808,163 |
Common stock, shares outstanding | 59,840,467 | 45,808,163 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Revenue: | |||
Collaboration and license revenue | $ 1,556 | $ 189,476 | $ 30,041 |
Other revenue | 630 | ||
Total revenue | 1,556 | 190,106 | 30,041 |
Operating expenses: | |||
Research and development (includes related party of $8,199, $34,705 and $42,768 for the years ended December 31, 2017, 2016 and 2015, respectively) | 162,389 | 254,440 | 213,062 |
General and administrative (includes related party of $62, $178 and $559 for the years ended December 31, 2017, 2016 and 2015, respectively) | 71,303 | 51,597 | 36,046 |
Total operating expenses | 233,692 | 306,037 | 249,108 |
Loss from operations | (232,136) | (115,931) | (219,067) |
Interest expense (includes related party of $2,388, $1,980 and $0 for the years ended December 31, 2017, 2016 and 2015, respectively) | (9,552) | (7,980) | (33) |
Other income (expense), net | 3,402 | (3,877) | (4,838) |
Net loss | (238,286) | (127,788) | (223,938) |
Net loss attributable to non-controlling interest | 116 | 451 | 678 |
Net loss attributable to Coherus | $ (238,170) | $ (127,337) | $ (223,260) |
Net loss per share attributable to Coherus, basic and diluted | $ (4.48) | $ (3.04) | $ (6.01) |
Weighted-average number of shares used in computing net loss per share attributable to Coherus, basic and diluted | 53,133,620 | 41,912,300 | 37,122,008 |
Consolidated Statements of Ope5
Consolidated Statements of Operations (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
General and administrative expenses from transactions with related party | $ 62 | $ 178 | $ 559 |
Interest expense from transactions with related party | 2,388 | 1,980 | 0 |
Research and Development Expense | |||
Research and development from transactions with related party | $ 8,199 | $ 34,705 | $ 42,768 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Statement Of Income And Comprehensive Income [Abstract] | |||
Net loss | $ (238,286) | $ (127,788) | $ (223,938) |
Other comprehensive loss: | |||
Foreign currency translation adjustments, net of tax | (120) | (229) | 124 |
Comprehensive loss | (238,406) | (128,017) | (223,814) |
Comprehensive loss attributable to non-controlling interest | 116 | 451 | 678 |
Comprehensive loss attributable to Coherus | $ (238,290) | $ (127,566) | $ (223,136) |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity (Deficit) - USD ($) $ in Thousands | Total | InteKrin | Follow-On Public Offering | Private Placement | Common Stock Offering | 2017 Bonus Payout | Common Stock | Common StockInteKrin | Common StockFollow-On Public Offering | Common StockPrivate Placement | Common StockCommon Stock Offering | Common StockRestricted Stock Units | Common Stock2017 Bonus Payout | Additional Paid-In Capital | Additional Paid-In CapitalInteKrin | Additional Paid-In CapitalFollow-On Public Offering | Additional Paid-In CapitalPrivate Placement | Additional Paid-In CapitalCommon Stock Offering | Additional Paid-In Capital2017 Bonus Payout | Accumulated Other Comprehensive Loss | Accumulated Deficit | Total Coherus Stockholder Equity (Deficit) | Total Coherus Stockholder Equity (Deficit)InteKrin | Total Coherus Stockholder Equity (Deficit)Follow-On Public Offering | Total Coherus Stockholder Equity (Deficit)Private Placement | Total Coherus Stockholder Equity (Deficit)Common Stock Offering | Total Coherus Stockholder Equity (Deficit)2017 Bonus Payout | Noncontrolling Interest |
Beginning Balances at Dec. 31, 2014 | $ 66,757 | $ 3 | $ 254,048 | $ (525) | $ (186,725) | $ 66,801 | $ (44) | |||||||||||||||||||||
Beginning Balances, Shares at Dec. 31, 2014 | 33,257,978 | |||||||||||||||||||||||||||
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 | |||||||||||||||||||||||||||
Retired shares resulting from InteKrin escrow distribution in cash | (8) | |||||||||||||||||||||||||||
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 | |||||||||||||||||||||||||||
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 | |||||||||||||||||||||||||||
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 | 45,808,163 | 45,808,163 | ||||||||||||||||||||||||||
Issuance of common stock | $ 81,810 | $ 131,849 | $ 2,668 | $ 1 | $ 81,809 | $ 131,849 | $ 2,668 | $ 81,810 | $ 131,849 | $ 2,668 | ||||||||||||||||||
Issuance of common stock, Shares | 7,332,220 | 6,220,901 | 14,750 | 301,455 | ||||||||||||||||||||||||
Offering costs associate with common stock offering and private placements | $ (619) | (619) | (619) | |||||||||||||||||||||||||
Issuance of common stock upon exercise of stock options | $ 482 | 482 | 482 | |||||||||||||||||||||||||
Issuance of common stock upon exercise of stock options, Shares | 162,978 | 162,978 | ||||||||||||||||||||||||||
Stock-based compensation expense | $ 33,397 | 33,397 | 33,397 | |||||||||||||||||||||||||
Cumulative translation adjustment | (120) | (120) | (120) | |||||||||||||||||||||||||
Distributions to non-controlling interest | (116) | (116) | ||||||||||||||||||||||||||
Net loss attributable to Coherus | (238,170) | (238,170) | (238,170) | |||||||||||||||||||||||||
Ending Balances at Dec. 31, 2017 | $ 30,535 | $ 6 | $ 808,060 | $ (750) | $ (775,492) | $ 31,824 | $ (1,289) | |||||||||||||||||||||
Ending Balances, shares at Dec. 31, 2017 | 59,840,467 | 59,840,467 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Operating activities | |||
Net loss | $ (238,286) | $ (127,788) | $ (223,938) |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Depreciation and amortization | 3,398 | 2,996 | 1,869 |
Remeasurement of fair-value contingent consideration | (2,260) | 4,305 | 4,599 |
Non-cash accretion of discount on marketable securities | (156) | ||
Non-cash interest expense (income) from amortization of debt discount (receivable) | 1,352 | 1,041 | (38) |
Provision for other receivables | (1,300) | 1,300 | |
Stock-based compensation expense | 33,397 | 27,421 | 16,721 |
Non-cash bonus payment settled in common stock | 2,668 | ||
Non-cash manufacturing postponement fee settled in common stock | 4,125 | ||
Loss (gain) on disposal of property and equipment | 51 | (6) | |
Impairment of property and equipment | 558 | 382 | |
Changes in operating assets and liabilities: | |||
Receivables from collaboration and license agreement | 1,859 | (299) | 857 |
Notes receivable | 1,853 | ||
Prepaid assets | 15,958 | 3,127 | (14,288) |
Other assets | 2,844 | 1,111 | (3,329) |
Other assets - related party | 1,691 | ||
Other assets, non-current | 88 | 42 | |
Accounts payable | (3,810) | (4,965) | 18,404 |
Accounts payable - related parties | (644) | (2,671) | 1,528 |
Accrued liabilities | (19,033) | 3,953 | 12,832 |
Other liabilities | 83 | 65 | (28) |
Deferred revenue | (1,562) | (93,236) | 32,294 |
Advance payments under license agreements | (1,070) | (260) | 138 |
Contingent liability to collaborator | (66,255) | 38,605 | |
Other liabilities, non-current | 242 | 128 | 516 |
Net cash used in operating activities | (200,286) | (252,545) | (107,990) |
Investing activities | |||
Purchases of property and equipment | (4,573) | (6,515) | (6,164) |
Purchases of investments in marketable securities | (74,344) | ||
Proceeds from sales and maturities of investments in marketable securities | 74,500 | ||
Increase in restricted cash | (785) | ||
Net cash used in investing activities | (4,417) | (6,515) | (6,949) |
Financing activities | |||
Proceeds from issuance of convertible notes | 75,000 | ||
Proceeds from issuance of convertible notes - related parties | 25,000 | ||
Proceeds from follow-on offering, net of underwriters discounts and commissions | 112,800 | ||
Proceeds from private placement | 75,000 | 10,000 | |
Proceeds from common stock offering, net of underwriters discounts and commissions | 131,849 | 124,311 | |
Payments of convertible notes issuance costs | (739) | ||
Proceeds from issuances of common stock upon exercise of stock options | 482 | 3,312 | 1,429 |
Net cash provided by financing activities | 206,787 | 226,179 | 122,689 |
Effect of exchange rate changes in cash and cash equivalents | (120) | (398) | 84 |
Net increase (decrease) in cash and cash equivalents | 1,964 | (33,279) | 7,834 |
Cash and cash equivalents at beginning of period | 124,947 | 158,226 | 150,392 |
Cash and cash equivalents at end of period | 126,911 | 124,947 | 158,226 |
Supplemental disclosure of cash flow information | |||
Cash paid for interest | 8,200 | 6,939 | 33 |
Supplemental disclosures of noncash investing and financing activities | |||
Purchase of property and equipment in accounts payable and accrued liabilities | (430) | 507 | 1,684 |
Leasehold improvements allowance from landlord | 1,239 | ||
Costs related to future offerings in accounts payable and accrued liabilities | 124 | ||
Common stock offering costs in accounts payable and accrued liabilities | 75 | 39 | |
Manufacturing services settled in common stock | 6,810 | ||
Fair value of contingent consideration settled in common stock | 9,849 | ||
Initial Public Offering | |||
Financing activities | |||
Payments of offering costs | (855) | ||
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 and Private Placement | |||
Financing activities | |||
Payments of offering costs | $ (544) | $ (705) |
Organization and Operations
Organization and Operations | 12 Months Ended |
Dec. 31, 2017 | |
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, 2017, the Company had an accumulated deficit of $775.5 million and cash and cash equivalents of $126.9 million. In January 2018, the Company issued and sold 183,316 shares of common stock at a weighted average price of $9.38 per share through its ATM Offering Program and received total net proceeds of $1.7 million. The Company believes that its current available cash and cash equivalents will be sufficient to fund its planned expenditures and meet the Company’s obligations for at least 12 months following its financial statement issuance date . |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2017 | |
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, 2017: Coherus Intermediate Corp, Coherus Oncology, 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. 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 periods, contingent consideration, convertible notes valuation, as well as certain accrued liabilities. Management bases its estimates on historical experience and on other various assumptions that are believed to be reasonable under the circumstances. These estimates form the basis for making judgments about the carrying values of assets and liabilities when these values are not readily apparent from other sources. Accounting estimates and judgements are inherently uncertain and the 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, 2017, 2016 and 2015, the foreign exchange gains and losses recorded in other income (expense), net in the consolidated statements of operations were a net gain of $52,000, a net loss of $53,000 and a net loss of $386,000, 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. 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, 2017 2016 2015 United States $ — $ 188,292 $ 27,802 Rest of world 1,556 1,814 2,239 Total revenue $ 1,556 $ 190,106 $ 30,041 Customer Concentration Customers whose collaboration and license revenue accounted for 10% or more of total revenues were as follows: Year Ended December 31, 2017 2016 2015 Baxalta * 99 % 93 % Daiichi Sankyo 100 % * * * Cash and Cash Equivalents Cash and cash equivalents are comprised of cash and highly liquid investments with remaining maturities of 90 days or less at the date of purchase. The Company limits cash investments to financial institutions with high credit standings; therefore, management believes that there is no significant exposure to credit risk in the Company’s cash and cash equivalents. Investments in Marketable Securities Management determines the appropriate classification of investments in marketable securities at the time of purchase based upon management’s intent with regards to such investments and reevaluates such designation as of each balance sheet date. All investments in marketable securities are held as “available-for-sale” and are carried at estimated fair value as determined based upon quoted market prices or pricing models for similar securities. The Company classifies investments in marketable securities as short-term when they have remaining contractual maturities of one year or less from the balance sheet date. Unrealized gains and losses are excluded from earnings and are reported as a component of accumulated comprehensive income (loss). Realized gains and losses and declines in value judged to be other than temporary, if any, on available-for-sale securities are included in other income (expense), net, based on specific identification method. The Company started investing in marketable securities in 2017. For the year ended December 31, 2017, interest income from marketable securities was $0.8 million. 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 7). 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. The Company also maintains restricted cash in money market funds that invest primarily in U.S. Treasury securities. The Company has not recognized any losses from credit risks on such accounts during any of the periods presented. The Company believes it is not exposed to significant credit risk on its cash and money market funds. Fair Value of Financial Instruments Fair value accounting is applied to 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 is 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 assets 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 value of a long-lived asset exceeds its fair value. For the years ended December 31, 2017, 2016 and 2015, the Company recorded an impairment of property and equipment of $558,000, $0 and $382,000, respectively, 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, 2017, 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. No goodwill impairment was identified through December 31, 2017. Derivative Liability The Company has a derivative liability related to the contingent consideration associated with the acquisition of InteKrin in 2014. 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 Expense Clinical trial costs are a component of research and development expense. 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 Expense Research and development costs are charged to expense as incurred. Research and development expense 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 rendered. The Company considers regulatory approval of product candidates to be uncertain, and product manufactured prior to regulatory approval may not be sold unless regulatory approval is obtained. The Company expenses manufacturing costs for product candidates incurred prior to regulatory approval as research and development expenses as the Company incurs them. If and when regulatory approval of a product is obtained, the Company will begin capitalizing manufacturing costs related to the approved product into inventory. Stock-Based Compensation The Company measures the cost of equity-based service awards based on the grant-date fair value of the award. The compensation cost is recognized as expense on a straight-line basis over the vesting period for options, restricted common stock and restricted stock units (RSUs). 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 adopted the ASU No. 2016-09, Compensation-Stock Compensation Improvements to Employee Share-Based Payment, 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, ESPP and restricted common 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. For RSUs, the Company base the fair value of awards on the closing market value of the common stock at the date of grant. 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 sheet at December 31, 2017 and 2016. 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 unrealized gains and losses from available-for-sale marketable securities and foreign currency translation adjustments for the years ended December 31, 2017, 2016 and 2015. 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 is the only contract that would be impacted by the new revenue standard. As a result of Daiichi Sankyo’s decision in July 2017 to opt-out of the development of CHS-0214 in Japan, the Company recognized the remaining deferred revenue under this license agreement in the second quarter of 2017. Therefore, the Company concluded that the adoption of this standard will not have a material impact on its consolidated financial statements and related disclosures. 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 November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash — a consensus of the FASB Emerging Issues Task Force, (ASU 2016-18). In January 2017, the FASB issued ASU No. 2017-04, Intangibles-Goodwill and Other: Simplifying the Test for Goodwill Impairment 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, 2017 | |
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, 2017 Total Level 1 Level 2 Level 3 Assets: Money market funds $ 125,373 $ 125,373 $ — $ — Restricted cash (money market funds) 845 845 — — Total financial assets $ 126,218 $ 126,218 $ — $ — Liabilities: Contingent consideration $ 3,290 $ — $ — $ 3,290 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 There were no transfers between Level 1, Level 2 and Level 3 during the periods presented. Contingent Consideration As part of the InteKrin acquisition in February 2014, 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. 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 income (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 income (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 year ended December 31, 2015, the Company recognized $4.1 million in other income (expense), net in the consolidated statement of operations for the change in the fair value of the Earn-Out 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, 2017 applied a 25% risk-adjusted discount rate to measure present value and also captured an additional 8.0% 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 2017, the fair value of the compound transaction payment decreased as a result of reducing estimates of a payout to former InteKrin stockholders. The consideration is tiered based on the value of a license or similar agreement with a third party and the timing of such agreement. 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 $0.1 million. For the years ended December 31, 2017, 2016 and 2015, the Company recognized a gain of $2.3 million, a loss of $4.3 million and a loss of $460,000 in other income (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 December 31, 2015 $ 1,245 Change in fair value of the contingent consideration liability 4,305 Balance as of December 31, 2016 5,550 Change in fair value of the contingent consideration liability (2,260 ) Balance as of December 31, 2017 $ 3,290 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 $94.7 million (par value $100.0 million) as of December 31, 2017 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 15.9% as of December 31, 2017. |
Balance Sheet Components
Balance Sheet Components | 12 Months Ended |
Dec. 31, 2017 | |
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, 2017 2016 Prepaid clinical and other - related parties (see Note 13) $ 908 $ 3,714 Prepaid clinical, material and manufacturing 15,304 25,095 Prepaid other 2,152 2,825 Prepaid assets $ 18,364 $ 31,634 Property and Equipment, Net Property and equipment, net are as follows (in thousands): December 31, December 31, 2017 2016 Machinery and equipment $ 15,229 $ 10,294 Computer equipment and software 1,586 1,500 Furniture and fixtures 714 682 Leasehold improvements 4,344 4,322 Construction in progress 702 — Total property and equipment 22,575 16,798 Accumulated depreciation and amortization (9,802 ) (6,026 ) Property and equipment, net $ 12,773 $ 10,772 Depreciation and amortization expense was $3.4 million, $3.0 million and $1.9 million for the years ended December 31, 2017, 2016 and 2015, respectively. Impairment of property and equipment was $0.6 million and $0.4 million for the years ended December 31, 2017 and 2015, respectively. Accrued Liabilities Accrued liabilities are as follows (in thousands): December 31, December 31, 2017 2016 Accrued clinical - related parties (see Note 13) $ 510 $ 3,542 Accrued clinical and manufacturing 5,462 16,039 Accrued compensation 2,074 6,945 Accrued other 1,004 1,496 Accrued liabilities $ 9,050 $ 28,022 |
Collaboration and License Agree
Collaboration and License Agreement | 12 Months Ended |
Dec. 31, 2017 | |
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, 2017 2016 2015 Baxalta $ — $ 188,292 $ 27,802 Daiichi Sankyo 1,556 1,184 2,239 Total collaboration and license revenue $ 1,556 $ 189,476 $ 30,041 Daiichi Sankyo In January 2012, the Company entered into a license agreement with Daiichi Sankyo (the “License Agreement”), 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. Upon execution of the agreement, Daiichi Sankyo paid a non-refundable, upfront license fee of $10.0 million. The agreement had an initial term of ten years and contained provisions allowing Daiichi Sankyo to renew the agreement for an additional three years with respect to particular countries. Daiichi Sankyo 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 was not deemed viable, if material safety, efficacy or patient tolerability issues could not be remedied or overcome, or during the opt-out window after the achievement of specified objectives in the agreement. In 2012, Daiichi Sankyo opted out of the development and commercialization of etanercept in Taiwan and South Korea, and 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 concluded that the license was not a separate unit of accounting because Daiichi Sankyo could not benefit from the use of the license rights for their intended purpose without the products manufactured by the Company. Daiichi Sankyo relied 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 were 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 the straight-line method of revenue recognition was most appropriate for this agreement given there is no discernable pattern of its performance under the arrangement. The Company regularly evaluated the reasonableness of the estimated period of performance and the amortization of deferred revenue was revised 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 was responsible for gathering clinical data, formatting it into a case study report, and conducting the final analysis. The Company would transfer the clinical data and other regulatory approval application documents for the product and post marketing to Daiichi Sankyo within 90 days after finalization of such documents. Under the MOU 1, Daiichi’s Sankyo’s overall cost sharing responsibility included (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 were recognized as a reduction in research and development expense as the Company engaged 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 was 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 supplied finished study drug and study comparator drug for Daiichi Sankyo’s use in the Japanese portion of the product’s clinical trial. Daiichi Sankyo reimbursed these research and development costs in quarterly advance payments, for which the Company recorded $1.1 million as advance payments under license agreement in the consolidated balance sheet as of December 31, 2016. The Company recognized the advance payment as a reduction in the research and development expense when the research and development activity was performed. In July 2016 and December 2016, the Company entered into three memoranda of understanding (“MOU 4,” “MOU 5” and “MOU 6,” and together with MOU 1, MOU 2 and MOU 3, the “MOUs”) with Daiichi Sankyo. Under MOU 4, MOU 5 and MOU 6, the Company received $4.5 million for reimbursements of certain past costs incurred and the Company recognized these reimbursements as a reduction of research and development expenses when the research and development activity was performed. The Company accounted for the above MOUs as a separate arrangement, which was not deemed to be a material modification of the License Agreement. In July 2017, Daiichi Sankyo announced its decision, which was accepted by the Company, to discontinue development of the Company’s etanercept (Enbrel) biosimilar product candidate, CHS-0214, in Japan and to conclude the parties’ global open-label safety extension study in rheumatoid arthritis. Pursuant to the License Agreement, the Company regained the rights to develop and commercialize CHS-0214 in Japan. As a result of Daiichi Sankyo’s decision to opt-out of the development of CHS-0214 in Japan and not having any further performance obligations under the license arrangement, the Company recognized the remaining deferred revenue of $1.4 million as a collaboration and license revenue during the second quarter of 2017 in its condensed consolidated statement of operations. On August 9, 2017, the Company and Daiichi Sankyo entered into a letter of agreement, dated July 29, 2017 to terminate the License Agreement, including, any and all MOUs and other agreements executed between the parties relating to CHS-0214. As of December 31, 2017, there was no deferred revenue in the condensed consolidated balance sheet. 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. 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 $4.2 million, $9.7 million and $16.1 million for the years ended December 31, 2017, 2016 and 2015, 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. 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. 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 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. |
Debt Obligations
Debt Obligations | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Debt Obligations | 6. Debt Obligations 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, 2017, 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, 2017 (in thousands): December 31, 2017 Principal amount of the Convertible Notes $ 81,750 Unamortized debt discount and debt issuance costs (5,544 ) Convertible Notes $ 76,206 Principal amount of the Convertible Notes - related parties $ 27,250 Unamortized debt discount and debt issuance costs - related parties (1,848 ) Convertible Notes - related parties $ 25,402 Total Convertible Notes $ 101,608 If the Convertible Notes were converted on December 31, 2017, the holders of the Convertible Notes would receive common shares with an aggregate value of $39.4 million based on the Company’s closing stock price of $8.80. The following table presents the components of interest expense of the Convertible Notes for the year ended December 31, 2017 (in thousands): Year Ended December 31, 2017 Stated coupon interest $ 6,150 Accretion of debt discount and debt issuance costs 1,014 Interest expense $ 7,164 Stated coupon interest - related parties $ 2,050 Accretion of debt discount and debt issuance costs - related parties 338 Interest expense - related parties $ 2,388 Total interest expense $ 9,552 The remaining unamortized debt discount and debt offering costs related to the Company’s Convertible Notes of approximately $7.4 million as of December 31, 2017, will be amortized using the effective interest rate over the remaining term of the Convertible Notes of 4.25 years. The annual effective interest rate is 9.48% for the Convertible Notes. During the years ended December 31, 2017 and 2016, the Company recognized total interest expense of $9.6 million and $7.9 million related to the Convertible Notes’ accrued interest and amortization of the debt discount, respectively. Future payments on the Convertible Notes as of December 31, 2017 are as follows (in thousands): Year ending December 31, 2018 $ 8,200 2019 8,200 2020 8,200 2021 8,200 2022 111,050 Total minimum payments 143,850 Less amount representing interest (34,850 ) Convertible Notes, principal amount 109,000 Less debt discount and debt issuance costs on Convertible Notes (7,392 ) Net carrying amount of Convertible Notes $ 101,608 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2017 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 7. 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. Contingencies On March 3, 2017, Amgen Inc. and Amgen USA Inc. (collectively “Amgen”) 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. On June 1, 2017, Amgen filed a Second Amended Complaint, which alleges as to Coherus (i) unfair competition under California Business and Professions Code Section 17200 et seq., (ii) misappropriation of trade secrets, (iii) aiding and abetting breach of duty of loyalty and (iv) tortious interference with contract. As to defendant Weiser, the Second Amended 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 and (v) breach of duty of loyalty. KBI Biopharma Inc. is not named as a defendant in the Second Amended Complaint. The Second Amended Complaint seeks injunctive relief and monetary damages. Although Amgen has indicated it intends to seek a preliminary injunction, no motion has been filed yet. The court has set a trial date of January 22, 2019. On May 10, 2017, Amgen Inc. and Amgen Manufacturing Inc. filed an action against the Company in the U.S. District Court for the District of Delaware alleging infringement of one or more claims of Amgen’s US patent 8,273,707 (the “707 patent”) under 35 U.S.C. § 271. The complaint seeks injunctive relief, monetary damages and attorney fees. On September 18, 2017, the court issued a scheduling order with a claim construction hearing set for June 25, 2018, and a trial date of September 16, 2019. On December 7, 2017, the U.S. Magistrate Judge issued under seal a Report and Recommendation to the District Court recommending that the District Court grant, with prejudice, the Company’s pending motion to dismiss Amgen’s complaint for failure to state a claim pursuant to Federal Rule of Civil Procedure 12(b)(6).The District Court issued a publicly available version of the Magistrate Judge’s Report and Recommendation on January 11, 2018. The Company expects the District Court to decide in the latter part of the first or early part of the second quarter of 2018 whether to adopt the Magistrate Judge’s recommendation. The Company believes that these lawsuits are without merit and intends to vigorously defend its position. However, if Amgen were to be successful in its effort to seek injunctive relief, these legal actions may delay the timing of CHS-1701 commercial release, and negatively affect the Company’s future revenues and results of operations. It is not possible at this time to determine the likelihood of an unfavorable outcome or an estimate of the amount or range of any potential loss. 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, 2017 and 2016. 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, 2017 are as follows (in thousands): Year ending December 31, 2018 $ 2,601 2019 2,588 2020 2,595 2021 2,672 2022 2,518 Total minimum lease payments $ 12,974 Rent expense was $2.3 million, $1.7 million and $1.8 million for the years ended December 31, 2017, 2016 and 2015, 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. |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) | 12 Months Ended |
Dec. 31, 2017 | |
Equity Method Investment Summarized Financial Information Liabilities And Equity [Abstract] | |
Stockholders' Equity (Deficit) | 8. Stockholders’ Equity 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. In January and December 2017, the Company sold 925,999 shares of common stock at a weighted average price of $12.42 per share through its ATM Offering Program and received total gross proceeds of $11.5 million. After deducting commission of $0.3 million and offering expense of $0.1 million, the net proceeds were $11.1 million. In January 2018, the Company issued and sold 183,316 shares of common stock at a weighted average price of $9.38 per share through its ATM Offering Program and received total net proceeds of $1.7 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 $0.3 million, the net proceeds were $120.4 million. In August 2017, the Company issued and sold an aggregate of 6,556,116 shares of common stock to V-Sciences Investments Pte Ltd, a private limited Singapore company, (“Temasek”) in a private placement transaction at an offering price of $11.4397 per share for gross proceeds of $75.0 million. After deducting offering expenses of $0.1 million, the net proceeds were $74.9 million. Pursuant to the stock purchase agreement, Temasek may purchase additional shares of common stock equal to gross proceeds of $75.0 million, subject to certain conditions. On September 22, 2017, the Company filed a registration statement with the SEC registering the resale of the common stock sold and issued in the private placement transaction as of August 2017, and it was declared effective by the SEC on October 16, 2017. In December 2017, the Company issued an aggregate of 776,104 shares of common stock to KBI Biopharma, Inc., a contract manufacturing organization (“KBI”), in a private placement transaction at an offering price of $8.7746 per share amounting to $6.8 million. Pursuant to the purchase agreement, as consideration for the issuance of the shares, the Company will not be charged the (i) $4.1 million postponement fee, owed by the Company pursuant to the master service agreement for the postponement of the start of the 2017 manufacturing campaign of CHS-1701, (ii) $2.7 million campaign reservation fee for the second 2018 manufacturing campaign of CHS-1701 and (iii) increase of certain batch fees until the 2018 manufacturing campaign of CHS-1701 begins. The Company provided to KBI the right to receive contingent cash royalty payments, in an amount not to exceed $0.7 million in aggregate, upon the achievement of certain conditions related to the timing of the delivery by KBI to the Company of CHS-1701 (see Note 7). |
Stock Option Plans and Stock-Ba
Stock Option Plans and Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock Option Plans and Stock-Based Compensation | 9. 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, 2015, 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 $9,000 for the year ended December 31, 2015, related to shares of common stock granted pursuant to the Founders’ Shares agreements. Equity Incentive Plans In October 2014, the Company’s board of directors and its stockholders adopted the 2014 Equity Incentive Plan (the “2014 Plan”), which became effective upon the closing of the Company’s IPO on November 6, 2014. The Company is authorized to issue 11,058,518 shares of common stock under the 2014 Plan and had 171,672 shares of common stock available for future issuance as of December 31, 2017. The 2014 Plan is subject to automatic annual increases in the number of shares available for issuance on the first business day of each fiscal year 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. All remaining shares under the Company’s 2010 Stock Plan (the “2010 Plan”) were transferred to the 2014 Plan upon adoption and any additional shares than would otherwise return to the 2010 Plan as a result of forfeiture, termination or expiration of the awards will return to the 2014 Plan. The 2014 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. 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. As of December 31, 2017, the Company is authorized to issue 994,000 shares of common stock under the 2016 Plan and had 345,500 shares of common stock available for future issuance. Stock Options Incentive stock options and non-statutory stock options may be granted with exercise prices of not less than the fair value of the common stock on the date of grant. These stock options were granted to generally vest over four years, expire in ten years from the date of grant and are generally exercisable after vesting. The following table sets forth the summary of option activities under the 2016 and 2014 Plans: Options Outstanding Number of Options Weighted-Average Exercise Balances at December 31, 2016 10,150,136 $ 15.636 Authorized — — Granted - at fair value 2,890,250 17.403 Exercised (162,978 ) 2.958 Forfeited /cancelled (1,471,189 ) 22.955 Balances at December 31, 2017 11,406,219 $ 15.321 Additional information related to the status of options as of December 31, 2017 is summarized as follows: Number of Options Weighted- Average Exercise Price Weighted- Average Contractual Terms (Years) Aggregate Intrinsic Value (in thousands) Options outstanding 11,406,219 $ 15.321 7.04 $ 24,236 Options vested and expected to vest 11,406,219 $ 15.321 7.00 $ 24,236 Options vested and exercisable 6,618,281 $ 12.617 5.95 $ 23,424 During the years ended December 31, 2017, 2016 and 2015, the total estimated fair value of the options vested was $29.4 million, $23.2 million and $14.6 million, respectively and the estimated weighted-average grant-date fair value of options granted was $11.70, $13.32 and $18.42 per share, respectively. The aggregate intrinsic value of options exercised during the years ended December 31, 2017, 2016 and 2015 was $2.1 million, $15.8 million and $22.4 million, respectively. The Company recognized stock-based compensation expenses of $29.0 million, $23.2 million and $14.7 million in 2017, 2016 and 2015, respectively, related to employee stock options. As of December 31, 2017, total unrecognized stock-based compensation expenses related to unvested employee stock options was $51.9 million, which is expected to be recognized on a straight-line basis over a weighted-average period of approximately 2.20 years. Restricted Stock Units In August 2017, the Compensation Committee of the Company’s board of directors approved the granting of restricted stock units (“RSUs”) to its employees. RSUs are share awards that entitle the holder to receive freely tradable shares of our common stock upon vesting. The RSUs cannot be transferred and are subject to forfeiture if the holder’s employment terminates prior to the release of the vesting restrictions. The Company’s RSUs generally vest from the applicable grant date according to the following vesting schedules: 50% after twelve months, 25% after 18 months, and 25% after 24 months, provided the employee remains continuously employed with the Company. The fair value of RSUs is equal to the closing price of our common stock on the applicable grant date of the RSUs. The following table sets forth the summary of RSUs activity, under the 2014 Plan: RSUs Outstanding Number of RSUs Weighted-Average Grant Date Balances at December 31, 2016 — $ — RSUs granted 457,207 10.432 RSUs vested (316,205 ) 8.935 RSUs cancelled (20,625 ) 12.700 Balances at December 31, 2017 120,377 $ 13.975 During the year ended December 31, 2017, the total estimated grant date fair value of RSUs was $6.4 million, including a $4.3 million 2017 bonus payout settled in RSUs. The total fair value of RSUs vested was $2.9 million, including a $2.7 million 2017 bonus payout settled in RSUs. The estimated weighted-average grant-date fair value of RSUs granted was $10.43 per share. The Company recognized stock-based compensation expenses of $0.6 million in 2017, related to RSUs. As of December 31, 2017, total unrecognized stock-based compensation expenses related to unvested RSUs was $1.2 million, which is expected to be recognized on a straight-line basis over a weighted-average period of approximately 1.52 years. Nonemployees Stock-Based Compensation The Company granted 60,000, 248,650 and 198,750 stock options to purchase shares of common stock to nonemployees during the years ended December 31, 2017, 2016 and 2015, respectively. The weighted-average exercise price of the options granted in 2017, 2016 and 2015 was $13.47, $18.16 and $26.51 per share, respectively. For the years ended December 31, 2017, 2016 and 2015, the Company recorded stock-based compensation expense related to options granted to nonemployees of $1.9 million, $4.2 million and $2.0 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. 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 ESPP provides 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. The ESPP had 1,500,715 shares of common stock available for future issuance as of December 31, 2017. Eligible employees may purchase common stock at 85% of the lesser of the fair market value of the Company’s common stock on the first or last day of the offering period. The first offering period of ESPP commenced on November 16, 2017. The Company recognized stock-based compensation expenses of $80,000 in 2017 related to the ESPP. As of December 31, 2017, there was $0.2 million of unrecognized compensation expense associated with the ESPP, which is expected to be recognized over an estimated weighted-average period of five months. Stock-Based Compensation The stock-based compensation expense is reflected in the consolidated statements of operations as follows (in thousands): Year Ended December 31, 2017 2016 2015 Research and development $ 15,104 $ 13,592 $ 8,038 General and administrative 18,293 13,829 8,683 $ 33,397 $ 27,421 $ 16,721 The Company has a change of control and involuntary termination benefit agreement in place with the Company’s senior executives. The agreement provided for severance terms, acceleration of options and extension of exercise period in the event of a change of control or involuntary termination. For the year ended December 31, 2017, the Company recorded a non-cash stock-based compensation expense for option modifications of $0.5 million and $1.3 million, which was reflected in research and development and general and administrative expenses in the consolidated statement of operations, respectively. The stock-based compensation expense for the option modifications were primarily due to the Company’s restructuring plan completed in June 2017 (see Note 10). Valuation Assumptions of Awards Granted to Employees The Company estimated the fair value of each stock option and awards granted under the ESPP on the date of grant using the Black-Scholes option-pricing model. The following table illustrates the weighted average assumptions for the Black-Scholes option-pricing model used in determining the fair value of the awards during the years ended December 31, 2017, 2016 and 2015: Year Ended December 31, 2017 2016 2015 Expected term (years) Stock options 6.00 6.00 6.00 ESPP 0.50 — — Expected volatility Stock options 76 % 75 % 78 % ESPP 68 % — — Risk-free interest rate Stock options 2.01 % 1.42 % 1.62 % ESPP 1.42 % — — Expected dividend yield Stock options 0 % 0 % 0 % ESPP 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 and contractual term. 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 sufficient 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 |
Restructuring
Restructuring | 12 Months Ended |
Dec. 31, 2017 | |
Restructuring And Related Activities [Abstract] | |
Restructuring | 10. Restructuring On June 21, 2017, the Company commenced and completed a restructuring plan to reduce operating costs to better align its workforce with the needs of its business following the FDA’s June 2017 issuance of a CRL for its BLA for CHS-1701, in which the FDA stated that it cannot approve the Company’s BLA for CHS-1701 in its present form and provided recommendations to the Company to address the issues raised in the letter. In connection with the restructuring, the Company recorded aggregate restructuring charges in its consolidated statement of operations of $3.6 million in June 2017. The restructuring charges included one-time termination fees and other employee-related costs of $1.0 million and $1.1 million in research and development and general and administrative expenses in the consolidated statement of operations, respectively. Additionally, non-cash stock-based compensation expense related to the acceleration of stock options and the extension of post-termination stock option exercise periods of $0.3 million and $1.2 million was reflected in research and development and general and administrative expenses in the consolidated statement of operations, respectively. As of December 31, 2017, the Company has paid out $2.1 million in personnel-related restructuring charges and expects to pay the remainder by the end of the first quarter of 2018. As of December 31, 2017, $0.1 million of restructuring liabilities remain on the Company’s consolidated balance sheet. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 11. 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, 2017 2016 2015 Domestic $ (222,674 ) $ (95,776 ) $ (220,059 ) Foreign (15,496 ) (31,561 ) (3,201 ) Total $ (238,170 ) $ (127,337 ) $ (223,260 ) 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, 2017 2016 2015 Percent of pre-tax income: U.S. federal statutory income tax rate 34.00 % 34.00 % 34.00 % State taxes, net of federal benefit 0.80 1.98 0.70 Foreign rate differences (2.21 ) (8.43 ) (0.49 ) Permanent items (0.19 ) (2.02 ) (1.25 ) Research and development credit 2.10 8.38 2.46 Effect in NOLs due to adoption of ASU 2016-09 4.55 — — U.S. Tax Reform tax rate change (36.90 ) — — Other (0.21 ) (0.13 ) 0.57 Change in valuation allowance (1.94 ) (33.78 ) (35.99 ) Effective income tax rate — % — % — % Significant components of the Company’s net deferred tax assets as of December 31, 2017 and 2016 consist of the following (in thousands): December 31, 2017 2016 Net operating loss carryforwards $ 134,420 $ 136,854 Research and development credits 34,435 26,172 Depreciation and amortization 336 645 Stock-based compensation 13,119 11,995 Other accruals 655 2,495 Deferred revenue — 531 Gross deferred tax assets 182,965 178,692 In-process research and development (550 ) (891 ) Gross deferred tax liabilities (550 ) (891 ) Total net deferred tax asset 182,415 177,801 Less valuation allowance (182,415 ) (177,801 ) Net deferred tax assets $ — $ — On December 22, 2017, the Tax Cuts and Jobs Act of 2017 (the “Tax Act”) was signed into law. Accounting Standards Codification (ASC) 740, Income Taxes, requires companies to recognize the effect of the tax law changes in the period of enactment. However, the SEC staff issued Staff Accounting Bulletin 118, which will allow companies to record provisional amounts during a measurement period that is similar to the measurement period used when accounting for business combinations. The Company has adjusted its deferred tax assets and liabilities based on the reduction of the U.S. federal corporate tax rate from 35% to 21% and assessed the realizability of its deferred tax assets based on the current understanding of the provisions of the new law. The Company considers its accounting for the impacts of the new law to be provisional and will continue to assess the impact of the recently enacted tax law on its business and consolidated financial statements over the next twelve months. The valuation allowance increased $4.6 million, $43.0 million and $79.2 million during the years ended December 31, 2017, 2016 and 2015, respectively. As of December 31, 2017, the Company had federal net operating loss carryforwards of approximately $624.3 million, which will start to expire beginning in 2031, and various state net operating loss carryforwards of approximately $43.6 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. Under the new enacted tax law, the carry forward period of net operating losses generated from 2018 forward is indefinite. However, the carryforward period for net operating losses generated prior to 2018 remains the same. Therefore, the annual limitation may result in the expiration of certain net operating losses and tax credit carryforwards before their utilization. As of December 31, 2017, the Company had federal research and development credit carryforwards of approximately $37.5 million, which will start to expire in 2031, and state research and development credit carryforwards of approximately $14.8 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, 2017 and 2016. The deferred tax assets were primarily comprised of federal and state tax net operating losses and tax credit carryforwards. Utilization of the net operating loss and tax credit carryforwards may be subject to an annual limitation due to historical or future ownership percentage change rules provided by the Internal Review Code of 1986, and similar state provisions. The annual limitation may result in the expiration of certain net operating loss and tax credit carryforwards before their utilization. The Company adopted ASU 2016-09 on January 1, 2017. Under this guidance, on a prospective basis, companies will no longer record excess tax benefits and certain tax deficiencies in additional paid-in capital. Instead, they will record all excess tax benefits and tax deficiencies as income tax expense or benefit in the statement of operations. In addition, the guidance eliminates the requirement that excess tax benefits be realized before companies can recognize them. The standard requires a cumulative-effect adjustment for previously unrecognized excess tax benefits in opening retained earnings in the annual period of adoption. As of January 1, 2017, the Company had a previously unrecognized deferred tax asset of $10.8 million relating to the excess tax benefits. Upon adoption, the Company recognized this excess tax benefit as a deferred tax asset with a corresponding increase to its deferred tax asset valuation allowance. Additionally, as provided for under this new guidance, the Company elected to account for forfeitures as they occur. The adoption of this standard did not have a material impact on the Company’s financial statements. 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, 2017, 2016 and 2015 is as follows (in thousands): Year Ended December 31, 2017 2016 2015 Balance at beginning of year $ 18,682 $ 10,605 $ 3,816 Additions based on tax positions related to current year 3,387 6,111 3,633 Additions for tax positions of prior years (6,387 ) 1,966 3,156 Balance at end of year $ 15,682 $ 18,682 $ 10,605 As of December 31, 2017 and 2016, the Company had approximately $15.7 million and $18.7 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, 2017, 2016 and 2015, the Company did not recognize accrued interest and penalties related to unrecognized tax benefits. The Company does not anticipate a material adjustment of 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, 2017 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share Attributable to Coherus | 12. 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, 2017 2016 2015 Numerator: Net loss attributable to Coherus $ (238,170 ) $ (127,337 ) $ (223,260 ) Denominator: Weighted-average common shares outstanding 53,133,620 41,912,300 37,125,617 Less: weighted-average unvested common shares subject to repurchase (1) — — (3,609 ) Weighted-average number of shares used in computing net loss per share attributable to Coherus, basic and diluted 53,133,620 41,912,300 37,122,008 Net loss per share attributable to Coherus, basic and diluted $ (4.48 ) $ (3.04 ) $ (6.01 ) (1) Shares were excluded as such shares represent restricted common stock (founders’ shares), which vest 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: Year Ended December 31, 2017 2016 2015 Stock options, including purchases from contributions to ESPP 11,433,069 10,150,136 7,808,842 Restricted stock units 120,377 — — Shares issuable upon conversion of Convertible Notes 4,473,871 4,473,871 — Total 16,027,317 14,624,007 7,808,842 In February 2018, the Company’s board of directors approved the Company’s refresh option grant of 2,490,100 shares to the employees and directors. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2017 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 13. Related Party Transactions 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, 2017, the Company had $0.9 million in prepaid assets (prepaid clinical and other–related parties), $0.2 million in accounts payable–related parties, and $0.5 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, 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. The Company recognized $8.2 million, $34.6 million and $42.5 million during years ended December 31, 2017, 2016 and 2015, 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, 2017 and 2016, 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, $17,000, $135,000 and $258,000 for the years ended December 31, 2017, 2016 and 2015, respectively, for services rendered by the recruiting company. The Company recorded in general and administrative expense in its consolidated statements of operations, $62,000, $178,000 and $559,000 for the year ended December 31, 2017, 2016 and 2015, respectively, for services rendered by the recruiting company. Convertible Notes — Related Parties 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 6 for related party disclosure). InteKrin Acquisition In February 2014, the Company completed the acquisition of the InteKrin for total consideration of $5.0 million. 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, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | 14. Subsequent Events In February 2018, the Company’s board of directors approved an option grant of 2,490,100 shares at an exercise price of $10.05 to the employees and directors. |
Supplementary Data - Quarterly
Supplementary Data - Quarterly Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Information | 15. Supplementary Data – Quarterly Financial Data (Unaudited) The following table presents certain unaudited consolidated quarterly financial information for each of the quarters ended December 31, 2017 and 2016: 2017 Quarter End (in thousands, except per share data) March 31 June 30 September 30 December 31 Total revenue $ 161 $ 1,395 $ — $ — Total operating expenses 72,578 58,033 56,615 46,466 Net loss (74,822 ) (55,402 ) (58,993 ) (49,069 ) Net loss attributable to Coherus (74,778 ) (55,336 ) (58,989 ) (49,067 ) Net loss per share attributable to Coherus, basic and diluted (1.54 ) (1.08 ) (1.09 ) (0.84 ) 2016 Quarter End 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: Basic (1) (1.67 ) (1.72 ) 1.93 (1.71 ) Diluted (1) (1.67 ) (1.72 ) 1.67 (1.71 ) (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 Sum24
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
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, 2017: Coherus Intermediate Corp, Coherus Oncology, 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. |
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 periods, contingent consideration, convertible notes valuation, as well as certain accrued liabilities. Management bases its estimates on historical experience and on other various assumptions that are believed to be reasonable under the circumstances. These estimates form the basis for making judgments about the carrying values of assets and liabilities when these values are not readily apparent from other sources. Accounting estimates and judgements are inherently uncertain and the 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, 2017, 2016 and 2015, the foreign exchange gains and losses recorded in other income (expense), net in the consolidated statements of operations were a net gain of $52,000, a net loss of $53,000 and a net loss of $386,000, 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. 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, 2017 2016 2015 United States $ — $ 188,292 $ 27,802 Rest of world 1,556 1,814 2,239 Total revenue $ 1,556 $ 190,106 $ 30,041 Customer Concentration Customers whose collaboration and license revenue accounted for 10% or more of total revenues were as follows: Year Ended December 31, 2017 2016 2015 Baxalta * 99 % 93 % Daiichi Sankyo 100 % * * * |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents are comprised of cash and highly liquid investments with remaining maturities of 90 days or less at the date of purchase. The Company limits cash investments to financial institutions with high credit standings; therefore, management believes that there is no significant exposure to credit risk in the Company’s cash and cash equivalents. |
Investments in Marketable Securities | Investments in Marketable Securities Management determines the appropriate classification of investments in marketable securities at the time of purchase based upon management’s intent with regards to such investments and reevaluates such designation as of each balance sheet date. All investments in marketable securities are held as “available-for-sale” and are carried at estimated fair value as determined based upon quoted market prices or pricing models for similar securities. The Company classifies investments in marketable securities as short-term when they have remaining contractual maturities of one year or less from the balance sheet date. Unrealized gains and losses are excluded from earnings and are reported as a component of accumulated comprehensive income (loss). Realized gains and losses and declines in value judged to be other than temporary, if any, on available-for-sale securities are included in other income (expense), net, based on specific identification method. The Company started investing in marketable securities in 2017. For the year ended December 31, 2017, interest income from marketable securities was $0.8 million. |
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 7). |
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. The Company also maintains restricted cash in money market funds that invest primarily in U.S. Treasury securities. The Company has not recognized any losses from credit risks on such accounts during any of the periods presented. The Company believes it is not exposed to significant credit risk on its cash and money market funds. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Fair value accounting is applied to 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 is 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 assets 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 value of a long-lived asset exceeds its fair value. For the years ended December 31, 2017, 2016 and 2015, the Company recorded an impairment of property and equipment of $558,000, $0 and $382,000, respectively, 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, 2017, 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. No goodwill impairment was identified through December 31, 2017. |
Derivative Liability | Derivative Liability The Company has a derivative liability related to the contingent consideration associated with the acquisition of InteKrin in 2014. 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 Expense Clinical trial costs are a component of research and development expense. 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 Expense Research and development costs are charged to expense as incurred. Research and development expense 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 rendered. The Company considers regulatory approval of product candidates to be uncertain, and product manufactured prior to regulatory approval may not be sold unless regulatory approval is obtained. The Company expenses manufacturing costs for product candidates incurred prior to regulatory approval as research and development expenses as the Company incurs them. If and when regulatory approval of a product is obtained, the Company will begin capitalizing manufacturing costs related to the approved product into inventory. |
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. The compensation cost is recognized as expense on a straight-line basis over the vesting period for options, restricted common stock and restricted stock units (RSUs). 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 adopted the ASU No. 2016-09, Compensation-Stock Compensation Improvements to Employee Share-Based Payment, 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, ESPP and restricted common 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. For RSUs, the Company base the fair value of awards on the closing market value of the common stock at the date of grant. |
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 sheet at December 31, 2017 and 2016. 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 unrealized gains and losses from available-for-sale marketable securities and foreign currency translation adjustments for the years ended December 31, 2017, 2016 and 2015. |
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 is the only contract that would be impacted by the new revenue standard. As a result of Daiichi Sankyo’s decision in July 2017 to opt-out of the development of CHS-0214 in Japan, the Company recognized the remaining deferred revenue under this license agreement in the second quarter of 2017. Therefore, the Company concluded that the adoption of this standard will not have a material impact on its consolidated financial statements and related disclosures. 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 November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash — a consensus of the FASB Emerging Issues Task Force, (ASU 2016-18). In January 2017, the FASB issued ASU No. 2017-04, Intangibles-Goodwill and Other: Simplifying the Test for Goodwill Impairment 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 Sum25
Basis of Presentation and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Summary of Revenue by Geographical Region | The following table summarizes revenue by geographic region (in thousands): Year Ended December 31, 2017 2016 2015 United States $ — $ 188,292 $ 27,802 Rest of world 1,556 1,814 2,239 Total revenue $ 1,556 $ 190,106 $ 30,041 |
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, 2017 2016 2015 Baxalta * 99 % 93 % Daiichi Sankyo 100 % * * * |
Schedule of Estimated Useful Lives of Property Plant and Equipment | Property and equipment is 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, 2017 | |
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, 2017 Total Level 1 Level 2 Level 3 Assets: Money market funds $ 125,373 $ 125,373 $ — $ — Restricted cash (money market funds) 845 845 — — Total financial assets $ 126,218 $ 126,218 $ — $ — Liabilities: Contingent consideration $ 3,290 $ — $ — $ 3,290 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 |
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 December 31, 2015 $ 1,245 Change in fair value of the contingent consideration liability 4,305 Balance as of December 31, 2016 5,550 Change in fair value of the contingent consideration liability (2,260 ) Balance as of December 31, 2017 $ 3,290 |
Balance Sheet Components (Table
Balance Sheet Components (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Schedule of Prepaid Assets | Prepaid assets are as follows (in thousands): December 31, December 31, 2017 2016 Prepaid clinical and other - related parties (see Note 13) $ 908 $ 3,714 Prepaid clinical, material and manufacturing 15,304 25,095 Prepaid other 2,152 2,825 Prepaid assets $ 18,364 $ 31,634 |
Schedule of Property and Equipment, Net | Property and equipment, net are as follows (in thousands): December 31, December 31, 2017 2016 Machinery and equipment $ 15,229 $ 10,294 Computer equipment and software 1,586 1,500 Furniture and fixtures 714 682 Leasehold improvements 4,344 4,322 Construction in progress 702 — Total property and equipment 22,575 16,798 Accumulated depreciation and amortization (9,802 ) (6,026 ) Property and equipment, net $ 12,773 $ 10,772 |
Schedule of Accrued Liabilities | Accrued liabilities are as follows (in thousands): December 31, December 31, 2017 2016 Accrued clinical - related parties (see Note 13) $ 510 $ 3,542 Accrued clinical and manufacturing 5,462 16,039 Accrued compensation 2,074 6,945 Accrued other 1,004 1,496 Accrued liabilities $ 9,050 $ 28,022 |
Collaboration and License Agr28
Collaboration and License Agreement (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
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, 2017 2016 2015 Baxalta $ — $ 188,292 $ 27,802 Daiichi Sankyo 1,556 1,184 2,239 Total collaboration and license revenue $ 1,556 $ 189,476 $ 30,041 |
Debt Obligations (Tables)
Debt Obligations (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Components of Convertible Notes | The following table summarizes information about the components of the Convertible Notes as of December 31, 2017 (in thousands): December 31, 2017 Principal amount of the Convertible Notes $ 81,750 Unamortized debt discount and debt issuance costs (5,544 ) Convertible Notes $ 76,206 Principal amount of the Convertible Notes - related parties $ 27,250 Unamortized debt discount and debt issuance costs - related parties (1,848 ) Convertible Notes - related parties $ 25,402 Total Convertible Notes $ 101,608 |
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, 2017 (in thousands): Year Ended December 31, 2017 Stated coupon interest $ 6,150 Accretion of debt discount and debt issuance costs 1,014 Interest expense $ 7,164 Stated coupon interest - related parties $ 2,050 Accretion of debt discount and debt issuance costs - related parties 338 Interest expense - related parties $ 2,388 Total interest expense $ 9,552 |
Schedule of Future Payments on the Convertible Notes | Future payments on the Convertible Notes as of December 31, 2017 are as follows (in thousands): Year ending December 31, 2018 $ 8,200 2019 8,200 2020 8,200 2021 8,200 2022 111,050 Total minimum payments 143,850 Less amount representing interest (34,850 ) Convertible Notes, principal amount 109,000 Less debt discount and debt issuance costs on Convertible Notes (7,392 ) Net carrying amount of Convertible Notes $ 101,608 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
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, 2017 are as follows (in thousands): Year ending December 31, 2018 $ 2,601 2019 2,588 2020 2,595 2021 2,672 2022 2,518 Total minimum lease payments $ 12,974 |
Stock Option Plans and Stock-31
Stock Option Plans and Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Summary of Option Activities under 2016 and 2014 Plans | The following table sets forth the summary of option activities under the 2016 and 2014 Plans: Options Outstanding Number of Options Weighted-Average Exercise Balances at December 31, 2016 10,150,136 $ 15.636 Authorized — — Granted - at fair value 2,890,250 17.403 Exercised (162,978 ) 2.958 Forfeited /cancelled (1,471,189 ) 22.955 Balances at December 31, 2017 11,406,219 $ 15.321 |
Summary of Additional Information Related to Status of Options | Additional information related to the status of options as of December 31, 2017 is summarized as follows: Number of Options Weighted- Average Exercise Price Weighted- Average Contractual Terms (Years) Aggregate Intrinsic Value (in thousands) Options outstanding 11,406,219 $ 15.321 7.04 $ 24,236 Options vested and expected to vest 11,406,219 $ 15.321 7.00 $ 24,236 Options vested and exercisable 6,618,281 $ 12.617 5.95 $ 23,424 |
Summary of RSU Activity, under 2014 Plan | The following table sets forth the summary of RSUs activity, under the 2014 Plan: RSUs Outstanding Number of RSUs Weighted-Average Grant Date Balances at December 31, 2016 — $ — RSUs granted 457,207 10.432 RSUs vested (316,205 ) 8.935 RSUs cancelled (20,625 ) 12.700 Balances at December 31, 2017 120,377 $ 13.975 |
Schedule of Stock-Based Compensation Expense | The stock-based compensation expense is reflected in the consolidated statements of operations as follows (in thousands): Year Ended December 31, 2017 2016 2015 Research and development $ 15,104 $ 13,592 $ 8,038 General and administrative 18,293 13,829 8,683 $ 33,397 $ 27,421 $ 16,721 |
Schedule of Weighted Average Assumptions for Black-Scholes Option-Pricing Model Used in Determining Fair Value of Awards | The following table illustrates the weighted average assumptions for the Black-Scholes option-pricing model used in determining the fair value of the awards during the years ended December 31, 2017, 2016 and 2015: Year Ended December 31, 2017 2016 2015 Expected term (years) Stock options 6.00 6.00 6.00 ESPP 0.50 — — Expected volatility Stock options 76 % 75 % 78 % ESPP 68 % — — Risk-free interest rate Stock options 2.01 % 1.42 % 1.62 % ESPP 1.42 % — — Expected dividend yield Stock options 0 % 0 % 0 % ESPP 0 % — — |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
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, 2017 2016 2015 Domestic $ (222,674 ) $ (95,776 ) $ (220,059 ) Foreign (15,496 ) (31,561 ) (3,201 ) Total $ (238,170 ) $ (127,337 ) $ (223,260 ) |
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, 2017 2016 2015 Percent of pre-tax income: U.S. federal statutory income tax rate 34.00 % 34.00 % 34.00 % State taxes, net of federal benefit 0.80 1.98 0.70 Foreign rate differences (2.21 ) (8.43 ) (0.49 ) Permanent items (0.19 ) (2.02 ) (1.25 ) Research and development credit 2.10 8.38 2.46 Effect in NOLs due to adoption of ASU 2016-09 4.55 — — U.S. Tax Reform tax rate change (36.90 ) — — Other (0.21 ) (0.13 ) 0.57 Change in valuation allowance (1.94 ) (33.78 ) (35.99 ) Effective income tax rate — % — % — % |
Components of Net Deferred Tax Assets | Significant components of the Company’s net deferred tax assets as of December 31, 2017 and 2016 consist of the following (in thousands): December 31, 2017 2016 Net operating loss carryforwards $ 134,420 $ 136,854 Research and development credits 34,435 26,172 Depreciation and amortization 336 645 Stock-based compensation 13,119 11,995 Other accruals 655 2,495 Deferred revenue — 531 Gross deferred tax assets 182,965 178,692 In-process research and development (550 ) (891 ) Gross deferred tax liabilities (550 ) (891 ) Total net deferred tax asset 182,415 177,801 Less valuation allowance (182,415 ) (177,801 ) Net deferred tax assets $ — $ — |
Reconciliation of Unrecognized Tax Benefits | A reconciliation of the Company’s unrecognized tax benefits for the years ended December 31, 2017, 2016 and 2015 is as follows (in thousands): Year Ended December 31, 2017 2016 2015 Balance at beginning of year $ 18,682 $ 10,605 $ 3,816 Additions based on tax positions related to current year 3,387 6,111 3,633 Additions for tax positions of prior years (6,387 ) 1,966 3,156 Balance at end of year $ 15,682 $ 18,682 $ 10,605 |
Net Loss Per Share Attributab33
Net Loss Per Share Attributable to Coherus (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
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, 2017 2016 2015 Numerator: Net loss attributable to Coherus $ (238,170 ) $ (127,337 ) $ (223,260 ) Denominator: Weighted-average common shares outstanding 53,133,620 41,912,300 37,125,617 Less: weighted-average unvested common shares subject to repurchase (1) — — (3,609 ) Weighted-average number of shares used in computing net loss per share attributable to Coherus, basic and diluted 53,133,620 41,912,300 37,122,008 Net loss per share attributable to Coherus, basic and diluted $ (4.48 ) $ (3.04 ) $ (6.01 ) (1) Shares were excluded as such shares represent restricted common stock (founders’ shares), which vest 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: Year Ended December 31, 2017 2016 2015 Stock options, including purchases from contributions to ESPP 11,433,069 10,150,136 7,808,842 Restricted stock units 120,377 — — Shares issuable upon conversion of Convertible Notes 4,473,871 4,473,871 — Total 16,027,317 14,624,007 7,808,842 |
Supplementary Data - Quarterl34
Supplementary Data - Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
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, 2017 and 2016: 2017 Quarter End (in thousands, except per share data) March 31 June 30 September 30 December 31 Total revenue $ 161 $ 1,395 $ — $ — Total operating expenses 72,578 58,033 56,615 46,466 Net loss (74,822 ) (55,402 ) (58,993 ) (49,069 ) Net loss attributable to Coherus (74,778 ) (55,336 ) (58,989 ) (49,067 ) Net loss per share attributable to Coherus, basic and diluted (1.54 ) (1.08 ) (1.09 ) (0.84 ) 2016 Quarter End 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: Basic (1) (1.67 ) (1.72 ) 1.93 (1.71 ) Diluted (1) (1.67 ) (1.72 ) 1.67 (1.71 ) (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, 2018 | Mar. 31, 2017 | Jun. 30, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Organization And Operations [Line Items] | |||||||
Accumulated deficit | $ 775,492 | $ 537,322 | |||||
Cash and cash equivalents | $ 126,911 | $ 124,947 | $ 158,226 | $ 150,392 | |||
Common stock, shares issued and sold | 4,025,000 | ||||||
Share price | $ 18 | ||||||
Common stock, net proceeds | $ 69,000 | ||||||
At-the-Market Equity Offering Program | |||||||
Organization And Operations [Line Items] | |||||||
Common stock, shares issued and sold | 5,294,902 | ||||||
Share price | $ 24.25 | ||||||
Common stock, net proceeds | $ 120,400 | ||||||
At-the-Market Equity Offering Program | Subsequent Event | |||||||
Organization And Operations [Line Items] | |||||||
Common stock, shares issued and sold | 183,316 | ||||||
Share price | $ 9.38 | ||||||
Common stock, net proceeds | $ 1,700 |
Basis of Presentation and Sum36
Basis of Presentation and Summary of Significant Accounting Policies - Additional Information (Details) | 12 Months Ended | ||
Dec. 31, 2017USD ($)Segments | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | |
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items] | |||
Foreign exchange gain (loss) | $ 52,000 | $ (53,000) | $ (386,000) |
Number of reportable segment | Segments | 1 | ||
Number of operating segments | Segments | 1 | ||
Impairment of property and equipment | $ 600,000 | 400,000 | |
Income tax examination, description | less than a 50% | ||
Unrecognized tax benefits, interest and penalties accrued related to income tax matters | $ 0 | 0 | |
Deferred tax asset valuation allowance | 182,415,000 | 177,801,000 | |
Accounting Standards Update 2016-09 | |||
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items] | |||
Deferred tax asset valuation allowance | 10,800,000 | ||
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 | 558,000 | $ 0 | $ 382,000 |
Impairment of intangible assets excluding goodwill | 0 | ||
Available-for-Sale Securities | Investment in Marketable Securities | |||
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items] | |||
Interest income from marketable securities | $ 800,000 | ||
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 Sum37
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 | |||||||||||
Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | [1] | Sep. 30, 2016 | [1] | Jun. 30, 2016 | [1] | Mar. 31, 2016 | [1] | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Revenues From External Customers And Long Lived Assets [Line Items] | |||||||||||||
Total revenue | $ 1,395 | $ 161 | $ 844 | $ 162,835 | $ 14,068 | $ 12,359 | $ 1,556 | $ 190,106 | $ 30,041 | ||||
United States | |||||||||||||
Revenues From External Customers And Long Lived Assets [Line Items] | |||||||||||||
Total revenue | 188,292 | 27,802 | |||||||||||
Rest of World | |||||||||||||
Revenues From External Customers And Long Lived Assets [Line Items] | |||||||||||||
Total revenue | $ 1,556 | $ 1,814 | $ 2,239 | ||||||||||
[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 $76.7 million, respectively, as revenue in the three months ended September 30, 2016 (see Note 5), and resulted in net income and net income attributable to Coherus for the three months ended September 30, 2016. |
Basis of Presentation and Sum38
Basis of Presentation and Summary of Significant Accounting Policies - Summary of Customers Revenue Accounted for 10% or More of Total Revenue (Details) - Collaboration and License Revenue - Customer Concentration Risk | 12 Months Ended | |||||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | ||||
Baxalta | ||||||
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items] | ||||||
Percentage of total revenues by single customer | [1] | 99.00% | 93.00% | |||
Daiichi Sankyo | ||||||
Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items] | ||||||
Percentage of total revenues by single customer | 100.00% | [1] | [1] | |||
[1] | less than 10% |
Basis of Presentation and Sum39
Basis of Presentation and Summary of Significant Accounting Policies - Schedule of Estimated Useful Lives of Property Plant and Equipment (Details) | 12 Months Ended |
Dec. 31, 2017 | |
Computer Equipment and Software | |
Property Plant And Equipment [Line Items] | |
Estimated useful lives | 3 years |
Furniture and Fixtures | |
Property Plant And Equipment [Line Items] | |
Estimated useful lives | 5 years |
Machinery and Equipment | |
Property Plant And Equipment [Line Items] | |
Estimated useful lives | 5 years |
Leasehold Improvements | |
Property Plant And Equipment [Line Items] | |
Estimated useful lives, description | Shorter of lease term or useful life |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) - USD ($) | Feb. 29, 2016 | Mar. 06, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 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 income (expense), net | (3,402,000) | 3,877,000 | $ 4,838,000 | |||
Remeasurement of fair-value contingent consideration | $ (2,260,000) | 4,305,000 | 4,599,000 | |||
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 | |||||
Fair value assumption, volatility rate | 60.00% | |||||
Other Expense, Net | ||||||
Fair Value Disclosures [Line Items] | ||||||
Remeasurement of fair-value contingent consideration | $ 2,300,000 | $ (4,300,000) | (460,000) | |||
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 | |||||
Business acquisition, value of shares issued | 9,800,000 | |||||
Additional fair value of earn-out payment to other expense | $ 4,100,000 | |||||
Other income (expense), net | $ 4,100,000 | |||||
Level 3 | 8.2% Senior Convertible Notes Due 2022 | ||||||
Fair Value Disclosures [Line Items] | ||||||
Debt instrument fair value | $ 94,700,000 | |||||
Level 3 | Long-Term Debt | Straight Debt | ||||||
Fair Value Disclosures [Line Items] | ||||||
Discount rate | 15.90% | |||||
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% | ||||
Increase (decrease) in expected probability of compound transaction payment occurrence | 1.00% | |||||
Estimated fair value fluctuation of Compound Transaction Payment | $ 100,000 | |||||
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, 2017 | Dec. 31, 2016 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total financial assets | $ 126,218 | $ 105,085 |
Contingent Consideration | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total financial liabilities | 3,290 | 5,550 |
Fair Value, Inputs, Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total financial assets | 126,218 | 105,085 |
Level 3 | Contingent Consideration | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total financial liabilities | 3,290 | 5,550 |
Money Market Funds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total financial assets | 125,373 | 104,240 |
Money Market Funds | Fair Value, Inputs, Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Total financial assets | 125,373 | 104,240 |
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) | Fair Value, Inputs, 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) - Contingent Consideration - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Fair Value Liabilities Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||
Beginning balance | $ 5,550 | $ 1,245 |
Change in fair value of the contingent consideration liability | (2,260) | 4,305 |
Ending balance | $ 3,290 | $ 5,550 |
Balance Sheet Components - Sche
Balance Sheet Components - Schedule of Prepaid Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Schedule Of Prepaid Assets [Line Items] | ||
Prepaid assets | $ 18,364 | $ 31,634 |
Prepaid Clinical and Other Related Parties | ||
Schedule Of Prepaid Assets [Line Items] | ||
Prepaid assets | 908 | 3,714 |
Prepaid Clinical, Material and Manufacturing | ||
Schedule Of Prepaid Assets [Line Items] | ||
Prepaid assets | 15,304 | 25,095 |
Prepaid Other | ||
Schedule Of Prepaid Assets [Line Items] | ||
Prepaid assets | $ 2,152 | $ 2,825 |
Balance Sheet Components - Sc44
Balance Sheet Components - Schedule of Property and Equipment, Net (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Property Plant And Equipment [Line Items] | ||
Total property and equipment | $ 22,575 | $ 16,798 |
Accumulated depreciation and amortization | (9,802) | (6,026) |
Property and equipment, net | 12,773 | 10,772 |
Machinery and Equipment | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment | 15,229 | 10,294 |
Computer Equipment and Software | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment | 1,586 | 1,500 |
Furniture and Fixtures | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment | 714 | 682 |
Leasehold Improvements | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment | 4,344 | $ 4,322 |
Construction in Progress | ||
Property Plant And Equipment [Line Items] | ||
Total property and equipment | $ 702 |
Balance Sheet Components - Addi
Balance Sheet Components - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Property Plant And Equipment [Abstract] | |||
Depreciation and amortization | $ 3,398 | $ 2,996 | $ 1,869 |
Impairment of property and equipment | $ 600 | $ 400 |
Balance Sheet Components - Sc46
Balance Sheet Components - Schedule of Accrued Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Payables And Accruals [Abstract] | ||
Accrued clinical - related parties | $ 510 | $ 3,542 |
Accrued clinical and manufacturing | 5,462 | 16,039 |
Accrued compensation | 2,074 | 6,945 |
Accrued other | 1,004 | 1,496 |
Accrued liabilities | $ 9,050 | $ 28,022 |
Collaboration and License Agr47
Collaboration and License Agreements - Schedule of Revenue Related to Collaboration and License Agreements (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Jun. 30, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||
Collaboration and license revenue | $ 1,400 | $ 1,556 | $ 189,476 | $ 30,041 |
Baxalta License Agreement | ||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||
Collaboration and license revenue | 188,292 | 27,802 | ||
Daiichi Sankyo License Agreement | ||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||
Collaboration and license revenue | $ 1,556 | $ 1,184 | $ 2,239 |
Collaboration and License Agr48
Collaboration and License Agreement - Additional Information (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||||
Jun. 30, 2015 | Jun. 30, 2013 | Jan. 31, 2012 | Jun. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Sep. 26, 2016 | |
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||
Advance payments under license agreement | $ 1,070,000 | ||||||||
Collaboration and license revenue | $ 1,400,000 | $ 1,556,000 | 189,476,000 | $ 30,041,000 | |||||
Deferred revenue, current | 892,000 | ||||||||
Deferred revenue, non-current | 669,000 | ||||||||
Daiichi Sankyo License Agreement | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||
Deferred revenue | $ 10,000,000 | $ 0 | 1,600,000 | ||||||
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 | ||||||||
Reimbursement of past cost incurred and to be incurred | 4,500,000 | ||||||||
Collaboration and license revenue | $ 1,556,000 | 1,184,000 | 2,239,000 | ||||||
Deferred revenue, current | 900,000 | ||||||||
Deferred revenue, non-current | 700,000 | ||||||||
Research and development | $ 4,200,000 | 9,700,000 | 16,100,000 | ||||||
Baxalta License Agreement | |||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||
Initial term of agreement | 10 years | ||||||||
Renewal term of agreement | 3 years | ||||||||
Collaboration and license revenue | 188,292,000 | $ 27,802,000 | |||||||
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 |
Debt Obligations - Additional I
Debt Obligations - Additional Information (Details) | Feb. 29, 2016USD ($)d$ / sharesshares | Dec. 31, 2017USD ($)$ / shares | Dec. 31, 2016USD ($) |
Debt Instrument [Line Items] | |||
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% | ||
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 | ||
Debt instrument maturity date | Mar. 31, 2022 | ||
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 | d | 30 | ||
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, 2017, the Company was in full compliance with these covenants and there were no events of default under the Convertible Notes. | ||
Convertible notes, converted amount | $ 39,400,000 | ||
Closing stock, price per share | $ / shares | $ 8.80 | ||
Unamortized debt discount and debt issuance costs on Convertible Notes | $ 7,392,000 | ||
Amortized effective interest rate convertible notes period | 4 years 3 months | ||
Convertible notes, effective interest rate | 9.48% | ||
Total interest expense related to accrued interest and amortization of debt discount | $ 9,600,000 | $ 7,900,000 | |
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% |
Debt Obligations - Components o
Debt Obligations - Components of Convertible Notes (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Feb. 29, 2016 |
Debt Instrument [Line Items] | |||
Convertible Notes | $ 76,206 | $ 75,192 | |
Convertible Notes - related parties | 25,402 | $ 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 | (7,392) | ||
Total Convertible Notes | 101,608 | ||
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 | (1,848) | ||
Convertible Notes - related parties | 25,402 | ||
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 | (5,544) | ||
Convertible Notes | $ 76,206 |
Debt Obligations - Components51
Debt Obligations - Components of Interest Expense of Convertible Notes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Debt Instrument [Line Items] | |||
Accretion of debt discount and debt issuance costs | $ 1,352 | $ 1,041 | $ (38) |
Interest expense | 2,388 | 1,980 | 0 |
Total interest expense | 9,552 | 7,980 | $ 33 |
8.2% Senior Convertible Notes Due 2022 | |||
Debt Instrument [Line Items] | |||
Interest expense | 9,600 | $ 7,900 | |
Total interest expense | 9,552 | ||
8.2% Senior Convertible Notes Due 2022 | Related Party Debt | |||
Debt Instrument [Line Items] | |||
Stated coupon interest | 2,050 | ||
Accretion of debt discount and debt issuance costs | 338 | ||
Interest expense | 2,388 | ||
8.2% Senior Convertible Notes Due 2022 | Parent Company | |||
Debt Instrument [Line Items] | |||
Stated coupon interest | 6,150 | ||
Accretion of debt discount and debt issuance costs | 1,014 | ||
Interest expense | $ 7,164 |
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, 2017USD ($) |
Debt Instrument [Line Items] | |
2,018 | $ 8,200 |
2,019 | 8,200 |
2,020 | 8,200 |
2,021 | 8,200 |
2,022 | 111,050 |
Total minimum payments | 143,850 |
Less amount representing interest | (34,850) |
Convertible Notes, principal amount | 109,000 |
Less debt discount and debt issuance costs on Convertible Notes | (7,392) |
Net carrying amount of Convertible Notes | $ 101,608 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) $ in Thousands | Dec. 27, 2016USD ($) | Sep. 21, 2016USD ($)ft² | Jul. 06, 2015USD ($)ft² | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) |
Purchase Commitment Excluding Longterm Commitment [Line Items] | ||||||
Area of office space leased | ft² | 40,341 | |||||
Current lease, leased date | Sep. 26, 2011 | |||||
Rent expense | $ 2,300 | $ 1,700 | $ 1,800 | |||
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 | |||||
One-time improvement allowance | 1,200 | |||||
New Lease Agreement | Letter of Credit | ||||||
Purchase Commitment Excluding Longterm Commitment [Line Items] | ||||||
Letter of credit amount | 800 | $ 800 | $ 800 | |||
Letter of credit amount at the end of lease term | 300 | |||||
New Lease Agreement | Maximum | ||||||
Purchase Commitment Excluding Longterm Commitment [Line Items] | ||||||
Rent for the final year of additional term | $ 1,900 | |||||
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 | |||||
One-time improvement allowance | 200 | |||||
Second Amendment Agreement | Maximum | ||||||
Purchase Commitment Excluding Longterm Commitment [Line Items] | ||||||
Rent for the final year of additional term | $ 900 | |||||
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 |
Commitments and Contingencies54
Commitments and Contingencies - Schedule of Future Minimum Lease Payments for all the Company's Leased Facilities (Details) $ in Thousands | Dec. 31, 2017USD ($) |
Commitments And Contingencies Disclosure [Abstract] | |
2,018 | $ 2,601 |
2,019 | 2,588 |
2,020 | 2,595 |
2,021 | 2,672 |
2,022 | 2,518 |
Total minimum lease payments | $ 12,974 |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) - Additional Information (Details) - USD ($) | Oct. 28, 2016 | Jan. 31, 2018 | Dec. 31, 2017 | Aug. 31, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Jun. 30, 2016 | Dec. 31, 2017 |
Class Of Stock [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 | $ 72,500,000 | |||||||
Underwriting discounts and commissions | 3,000,000 | |||||||
Offering expense | 500,000 | |||||||
Common stock, net proceeds | $ 69,000,000 | |||||||
At-the-Market Equity Offering Program | ||||||||
Class Of Stock [Line Items] | ||||||||
Common stock, shares issued and sold | 5,294,902 | |||||||
Issuance price per share of convertible preferred stock | $ 24.25 | |||||||
Gross proceeds from issuance of common stock | $ 128,400,000 | |||||||
Underwriting discounts and commissions | 7,700,000 | |||||||
Offering expense | 300,000 | |||||||
Common stock, net proceeds | $ 120,400,000 | |||||||
At-the-Market Equity Offering Program | Subsequent Event | ||||||||
Class Of Stock [Line Items] | ||||||||
Common stock, shares issued and sold | 183,316 | |||||||
Issuance price per share of convertible preferred stock | $ 9.38 | |||||||
Common stock, net proceeds | $ 1,700,000 | |||||||
At-the-Market Equity Offering Program | Cowen and Company LLC | ||||||||
Class Of Stock [Line Items] | ||||||||
Common stock, shares issued and sold | 2,015,987 | 925,999 | ||||||
Issuance price per share of convertible preferred stock | $ 12.42 | $ 28.04 | $ 12.42 | |||||
Gross proceeds from issuance of common stock | $ 56,500,000 | $ 11,500,000 | ||||||
Underwriting discounts and commissions | 1,700,000 | 300,000 | ||||||
Offering expense | 200,000 | 100,000 | ||||||
Common stock, net proceeds | $ 54,600,000 | $ 11,100,000 | ||||||
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% | |||||||
Private Placement | V-Sciences Investments Pte Ltd | ||||||||
Class Of Stock [Line Items] | ||||||||
Common stock, shares issued and sold | 6,556,116 | |||||||
Issuance price per share of convertible preferred stock | $ 11.4397 | |||||||
Gross proceeds from issuance of common stock | $ 75,000,000 | |||||||
Offering expense | 100,000 | |||||||
Common stock, net proceeds | 74,900,000 | |||||||
Additional shares of common stock available for purchase | $ 75,000,000 | |||||||
Private Placement | KBI Biopharma, Inc | ||||||||
Class Of Stock [Line Items] | ||||||||
Common stock, shares issued and sold | 776,104 | |||||||
Issuance price per share of convertible preferred stock | $ 8.7746 | $ 8.7746 | ||||||
Gross proceeds from issuance of common stock | $ 6,800,000 | |||||||
Purchase agreement, postponement fee not chargeable | 4,100,000 | |||||||
Purchase agreement, campaign reservation fee not chargeable | 2,700,000 | |||||||
Private Placement | Maximum | KBI Biopharma, Inc | ||||||||
Class Of Stock [Line Items] | ||||||||
Purchase agreement, contingent cash royalty payments | $ 700,000 | $ 700,000 |
Stock Option Plans and Stock-56
Stock Option Plans and Stock-Based Compensation - Additional Information (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |||||
Aug. 31, 2017 | Oct. 31, 2014 | Jan. 31, 2014 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Jun. 30, 2016 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Stock-based compensation expense | $ 33,397,000 | $ 27,421,000 | $ 16,721,000 | ||||
Common stock, shares authorized | 300,000,000 | 300,000,000 | |||||
Share based payment options vested | $ 29,400,000 | $ 23,200,000 | $ 14,600,000 | ||||
Share based payment options grants, grant-date fair value | $ 11.70 | $ 13.32 | $ 18.42 | ||||
Share based payment options exercises value | $ 2,100,000 | $ 15,800,000 | $ 22,400,000 | ||||
Unrecognized stock-based compensation expenses related to stock options | $ 51,900,000 | ||||||
Unrecognized share-based compensation related to stock options, RSUs and ESPP, period for recognition | 2 years 2 months 12 days | ||||||
Share based payment options grants | 2,890,250 | ||||||
Weighted-Average Exercise Price, Granted - at fair value | $ 17.403 | ||||||
Expected dividend yield | $ 0 | ||||||
Research and Development Expense | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Stock-based compensation expense | 15,104,000 | 13,592,000 | 8,038,000 | ||||
Non-cash stock-based compensation expense for option modifications | 500,000 | ||||||
General and Administrative Expense | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Stock-based compensation expense | 18,293,000 | $ 13,829,000 | $ 8,683,000 | ||||
Non-cash stock-based compensation expense for option modifications | $ 1,300,000 | ||||||
2014 Equity Incentive Award Plan | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Common stock, shares authorized | 11,058,518 | ||||||
Percentage of shares available for issuance | 4.00% | 4.00% | |||||
Common stock reserved for future issuance | 171,672 | ||||||
2016 Employment Commencement Incentive Plan | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Common stock, shares authorized | 994,000 | ||||||
Common stock reserved for future issuance | 345,500 | 1,000,000 | |||||
2014 Employee Stock Purchase Plan | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Stock-based compensation expense | $ 80,000 | ||||||
Common stock reserved for future issuance | 1,500,715 | ||||||
Unrecognized share-based compensation related to stock options, RSUs and ESPP, period for recognition | 5 months | ||||||
Unrecognized stock-based compensation expenses related to unvested RSUs | $ 200,000 | ||||||
Percentage of purchase common stock of lesser of fair market value of common stock on first or last day of offering period by eligible employees | 85.00% | ||||||
Employee stock purchase plan first offering period start date | Nov. 16, 2017 | ||||||
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% | ||||||
2014 Employee Stock Purchase Plan | Maximum | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Increase in number of shares of common stock available for future issuance | 320,000 | ||||||
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 | $ 9,000 | ||||||
Employee Stock Option | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Stock-based compensation expense | $ 29,000,000 | $ 23,200,000 | 14,700,000 | ||||
Vesting period | 4 years | ||||||
Options granted, expiration period | 10 years | ||||||
Restricted Stock Units | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Stock-based compensation expense | $ 600,000 | ||||||
Unrecognized share-based compensation related to stock options, RSUs and ESPP, period for recognition | 1 year 6 months 7 days | ||||||
Total estimated grant date fair value | $ 6,400,000 | ||||||
Total fair value of RSUs vested | $ 2,900,000 | ||||||
Estimated weighted-average grant-date fair value of RSUs granted | $ 10.43 | ||||||
Unrecognized stock-based compensation expenses related to unvested RSUs | $ 1,200,000 | ||||||
Restricted Stock Units | Vest After Twelve Months | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Vesting percentage from grant date | 50.00% | ||||||
Restricted Stock Units | Vest After 18 Months | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Vesting percentage from grant date | 25.00% | ||||||
Restricted Stock Units | Vest After 24 Months | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Vesting percentage from grant date | 25.00% | ||||||
Restricted Stock Units | 2014 Equity Incentive Award Plan | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Estimated weighted-average grant-date fair value of RSUs granted | $ 10.432 | ||||||
Two Thousand Seventeen Bonus Payout Settled In Restricted Stock Units R S Us | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Total estimated grant date fair value | $ 4,300,000 | ||||||
Total fair value of RSUs vested | 2,700,000 | ||||||
Nonemployees Stock-Based Compensation | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Stock-based compensation expense | $ 1,900,000 | $ 4,200,000 | $ 2,000,000 | ||||
Share based payment options grants | 60,000 | 248,650 | 198,750 | ||||
Weighted-Average Exercise Price, Granted - at fair value | $ 13.47 | $ 18.16 | $ 26.51 |
Stock Option Plans and Stock-57
Stock Option Plans and Stock-Based Compensation - Summary of Option Activities under 2016 and 2014 Plans (Details) | 12 Months Ended |
Dec. 31, 2017$ / sharesshares | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Number of Options, Beginning balance | shares | 10,150,136 |
Number of Options, Granted - at fair value | shares | 2,890,250 |
Number of Options, Exercised | shares | (162,978) |
Number of Options, Forfeited /cancelled | shares | (1,471,189) |
Number of Options, Ending balance | shares | 11,406,219 |
Weighted-Average Exercise Price, Beginning balance | $ / shares | $ 15.636 |
Weighted-Average Exercise Price, Granted - at fair value | $ / shares | 17.403 |
Weighted-Average Exercise Price, Exercised | $ / shares | 2.958 |
Weighted-Average Exercise Price, Forfeited /cancelled | $ / shares | 22.955 |
Weighted-Average Exercise Price, Ending balance | $ / shares | $ 15.321 |
Stock Option Plans and Stock-58
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, 2017 | Dec. 31, 2016 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ||
Options outstanding, Number of Options | 11,406,219 | 10,150,136 |
Options vested and expected to vest, Number of Options | 11,406,219 | |
Options vested and exercisable, Number of Options | 6,618,281 | |
Options outstanding, Weighted-Average Exercise Price | $ 15.321 | $ 15.636 |
Options vested and expected to vest, Weighted-Average Exercise Price | 15.321 | |
Options vested and exercisable, Weighted-Average Exercise Price | $ 12.617 | |
Options outstanding, Weighted-Average Contractual Terms | 7 years 15 days | |
Options vested and expected to vest, Weighted-Average Contractual Terms | 7 years | |
Options vested and exercisable, Weighted-Average Contractual Terms | 5 years 11 months 12 days | |
Options outstanding, Aggregate Intrinsic Value | $ 24,236 | |
Options vested and expected to vest, Aggregate Intrinsic Value | 24,236 | |
Options vested and exercisable, Aggregate Intrinsic Value | $ 23,424 |
Stock Option Plans and Stock-59
Stock Option Plans and Stock-Based Compensation - Summary of RSU Activity, under 2014 Plan (Details) - Restricted Stock Units | 12 Months Ended |
Dec. 31, 2017$ / sharesshares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Weighted-Average Grant Date Fair Value, RSU's granted | $ 10.43 |
2014 Equity Incentive Award Plan | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Number of RSU's granted | shares | 457,207 |
Number of RSU's vested | shares | (316,205) |
Number of RSU's cancelled | shares | (20,625) |
Number of RSU's, Balances at December 31, 2017 | shares | 120,377 |
Weighted-Average Grant Date Fair Value, RSU's granted | $ 10.432 |
Weighted-Average Grant Date Fair Value, RSU's Vested | 8.935 |
Weighted-Average Grant Date Fair Value, RSU's cancelled | 12.700 |
Weighted-Average Grant Date Fair Value, Balances at December 31, 2017 | $ 13.975 |
Stock Option Plans and Stock-60
Stock Option Plans and Stock-Based Compensation - Schedule of Stock-Based Compensation Expense Reflected in Consolidated Statements of Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | |||
Stock-based compensation expense | $ 33,397 | $ 27,421 | $ 16,721 |
Research and Development Expense | |||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | |||
Stock-based compensation expense | 15,104 | 13,592 | 8,038 |
General and Administrative Expense | |||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | |||
Stock-based compensation expense | $ 18,293 | $ 13,829 | $ 8,683 |
Stock Option Plans and Stock-61
Stock Option Plans and Stock-Based Compensation - Schedule of Weighted Average Assumptions for Black-Scholes Option-Pricing Model Used in Determining Fair Value of Awards (Details) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
ESPP | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Expected term (years) | 6 months | ||
Expected volatility | 68.00% | ||
Risk-free interest rate | 1.42% | ||
Expected dividend yield | 0.00% | ||
Stock Options | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Expected term (years) | 6 years | 6 years | 6 years |
Expected volatility | 76.00% | 75.00% | 78.00% |
Risk-free interest rate | 2.01% | 1.42% | 1.62% |
Expected dividend yield | 0.00% | 0.00% | 0.00% |
Restructuring - Additional Info
Restructuring - Additional Information (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended |
Jun. 30, 2017 | Dec. 31, 2017 | |
Restructuring Cost And Reserve [Line Items] | ||
Aggregate restructuring charges | $ 3.6 | |
Payments for personnel-related restructuring charges | $ 2.1 | |
Restructuring liabilities | $ 0.1 | |
Research and Development Expense | ||
Restructuring Cost And Reserve [Line Items] | ||
Non-cash stock-based compensation expense | 0.3 | |
General and Administrative Expense | ||
Restructuring Cost And Reserve [Line Items] | ||
Non-cash stock-based compensation expense | 1.2 | |
Termination Severance and Related Costs | Research and Development Expense | ||
Restructuring Cost And Reserve [Line Items] | ||
Aggregate restructuring charges | 1 | |
Termination Severance and Related Costs | General and Administrative Expense | ||
Restructuring Cost And Reserve [Line Items] | ||
Aggregate restructuring charges | $ 1.1 |
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, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | [1] | Sep. 30, 2016 | [1] | Jun. 30, 2016 | [1] | Mar. 31, 2016 | [1] | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Loss From Continuing Operations Before Income Taxes Minority Interest And Income Loss From Equity Method Investments [Abstract] | |||||||||||||||
Domestic | $ (222,674) | $ (95,776) | $ (220,059) | ||||||||||||
Foreign | (15,496) | (31,561) | (3,201) | ||||||||||||
Net loss attributable to Coherus | $ (49,067) | $ (58,989) | $ (55,336) | $ (74,778) | $ (75,921) | $ 83,939 | $ (69,967) | $ (65,388) | $ (238,170) | $ (127,337) | $ (223,260) | ||||
[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, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Jan. 31, 2017 | Dec. 31, 2014 | |
Operating Loss Carryforwards [Line Items] | ||||||
Provision for (benefit from) income taxes | $ 0 | $ 0 | $ 0 | |||
U.S. federal corporate tax rate | 34.00% | 34.00% | 34.00% | |||
Increase in valuation allowance | $ 4,600,000 | $ 43,000,000 | $ 79,200,000 | |||
Unrecognized tax benefits | 15,682,000 | 18,682,000 | 10,605,000 | $ 3,816,000 | ||
Unrecognized tax benefits, accrued interest and penalties accrued | 0 | $ 0 | $ 0 | |||
Accounting Standards Update 2016-09 | ||||||
Operating Loss Carryforwards [Line Items] | ||||||
Unrecognized tax benefits | $ 10,800,000 | |||||
Federal | ||||||
Operating Loss Carryforwards [Line Items] | ||||||
Net operating loss carryforwards | $ 624,300,000 | |||||
Net operating loss carryforwards expiration year | 2,031 | |||||
Tax credit carryforwards | $ 37,500,000 | |||||
Tax credit carryforwards expiration year | 2,031 | |||||
State | ||||||
Operating Loss Carryforwards [Line Items] | ||||||
Net operating loss carryforwards | $ 43,600,000 | |||||
Net operating loss carryforwards expiration year | 2,031 | |||||
Tax credit carryforwards | $ 14,800,000 | |||||
Maximum | ||||||
Operating Loss Carryforwards [Line Items] | ||||||
U.S. federal corporate tax rate | 35.00% | |||||
Scenario, Forecast | ||||||
Operating Loss Carryforwards [Line Items] | ||||||
U.S. federal corporate tax rate | 21.00% |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Statutory U.S. Federal Rate (Details) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Percent of pre-tax income: | |||
U.S. federal statutory income tax rate | 34.00% | 34.00% | 34.00% |
State taxes, net of federal benefit | 0.80% | 1.98% | 0.70% |
Foreign rate differences | (2.21%) | (8.43%) | (0.49%) |
Permanent items | (0.19%) | (2.02%) | (1.25%) |
Research and development credit | 2.10% | 8.38% | 2.46% |
U.S. Tax Reform tax rate change | (36.90%) | ||
Other | (0.21%) | (0.13%) | 0.57% |
Change in valuation allowance | (1.94%) | (33.78%) | (35.99%) |
Effective income tax rate | 0.00% | 0.00% | 0.00% |
Accounting Standards Update 2016-09 | |||
Percent of pre-tax income: | |||
Effect in NOLs due to adoption of ASU 2016-09 | 4.55% |
Income Taxes - Components of Ne
Income Taxes - Components of Net Deferred Tax Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Components Of Deferred Tax Assets [Abstract] | ||
Net operating loss carryforwards | $ 134,420 | $ 136,854 |
Research and development credits | 34,435 | 26,172 |
Depreciation and amortization | 336 | 645 |
Stock-based compensation | 13,119 | 11,995 |
Other accruals | 655 | 2,495 |
Deferred revenue | 531 | |
Gross deferred tax assets | 182,965 | 178,692 |
In-process research and development | (550) | (891) |
Gross deferred tax liabilities | (550) | (891) |
Total net deferred tax asset | 182,415 | 177,801 |
Less valuation allowance | (182,415) | (177,801) |
Net deferred tax assets | $ 0 | $ 0 |
Income Taxes - Reconciliation67
Income Taxes - Reconciliation of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Reconciliation Of Unrecognized Tax Benefits Excluding Amounts Pertaining To Examined Tax Returns Roll Forward | |||
Balance at beginning of year | $ 18,682 | $ 10,605 | $ 3,816 |
Additions based on tax positions related to current year | 3,387 | 6,111 | 3,633 |
Additions for tax positions of prior years | (6,387) | 1,966 | 3,156 |
Balance at end of year | $ 15,682 | $ 18,682 | $ 10,605 |
Net Loss Per Share Attributab68
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, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | [1] | Sep. 30, 2016 | [1] | Jun. 30, 2016 | [1] | Mar. 31, 2016 | [1] | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Numerator: | |||||||||||||||
Net loss attributable to Coherus | $ (49,067) | $ (58,989) | $ (55,336) | $ (74,778) | $ (75,921) | $ 83,939 | $ (69,967) | $ (65,388) | $ (238,170) | $ (127,337) | $ (223,260) | ||||
Denominator: | |||||||||||||||
Weighted-average common shares outstanding | 53,133,620 | 41,912,300 | 37,125,617 | ||||||||||||
Less: weighted-average unvested common shares subject to repurchase | (3,609) | ||||||||||||||
Weighted-average number of shares used in computing net loss per share attributable to Coherus, basic and diluted | 53,133,620 | 41,912,300 | 37,122,008 | ||||||||||||
Net loss per share attributable to Coherus, basic and diluted | $ (0.84) | $ (1.09) | $ (1.08) | $ (1.54) | $ (4.48) | $ (3.04) | $ (6.01) | ||||||||
[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 Attributab69
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, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from the calculation of diluted net loss per share | 16,027,317 | 14,624,007 | 7,808,842 |
Stock Options, Including Purchases from Contributions to ESPP | |||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from the calculation of diluted net loss per share | 11,433,069 | 10,150,136 | 7,808,842 |
Restricted Stock Units | |||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from the calculation of diluted net loss per share | 120,377 | ||
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 | 4,473,871 |
Net Loss Per Share Attributab70
Net Loss Per Share Attributable to Coherus - Additional Information (Details) - shares | 1 Months Ended | 12 Months Ended |
Feb. 28, 2018 | Dec. 31, 2017 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Share based payment options grants | 2,890,250 | |
Employees and Directors | Subsequent Event | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Share based payment options grants | 2,490,100 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |||
Feb. 28, 2014 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Feb. 29, 2016 | |
Related Party Transaction [Line Items] | |||||
Prepaid assets | $ 18,364,000 | $ 31,634,000 | |||
Other assets, current | 142,000 | 2,986,000 | |||
Research and development expense | 162,389,000 | 254,440,000 | $ 213,062,000 | ||
Accounts payable - related parties | 233,000 | 877,000 | |||
General and administrative expenses from transactions with related party | 62,000 | 178,000 | 559,000 | ||
InteKrin Therapeutics Inc | |||||
Related Party Transaction [Line Items] | |||||
Business combination consideration transferred | $ 5,000,000 | ||||
Medpace Inc | |||||
Related Party Transaction [Line Items] | |||||
Prepaid assets | 900,000 | 3,700,000 | |||
Other assets, current | 2,200,000 | ||||
Research and development expense | 8,200,000 | 34,600,000 | 42,500,000 | ||
Accounts payable - related parties | 200,000 | 900,000 | |||
Accrued and other liabilities | 500,000 | 3,500,000 | |||
Board of Directors | Recruiting Services | |||||
Related Party Transaction [Line Items] | |||||
Research and development expense | 17,000 | 135,000 | 258,000 | ||
Related party balances | 0 | 0 | |||
General and administrative expenses from transactions with related party | $ 62,000 | $ 178,000 | $ 559,000 | ||
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% |
Subsequent Events - Additional
Subsequent Events - Additional Information (Details) - $ / shares | 1 Months Ended | 12 Months Ended |
Feb. 28, 2018 | Dec. 31, 2017 | |
Subsequent Event [Line Items] | ||
Share based payment options grants | 2,890,250 | |
Subsequent Event | Employees and Directors | ||
Subsequent Event [Line Items] | ||
Share based payment options grants | 2,490,100 | |
Share-based payment options exercise price | $ 10.05 |
Supplementary Data - Quarterl73
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, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | ||||||
Quarterly Financial Information Disclosure [Abstract] | ||||||||||||||||
Total revenue | $ 1,395 | $ 161 | $ 844 | [1] | $ 162,835 | [1] | $ 14,068 | [1] | $ 12,359 | [1] | $ 1,556 | $ 190,106 | $ 30,041 | |||
Total operating expenses | $ 46,466 | $ 56,615 | 58,033 | 72,578 | 74,304 | 78,218 | 76,804 | 76,711 | 233,692 | 306,037 | 249,108 | |||||
Net income (loss) | (49,069) | (58,993) | (55,402) | (74,822) | (75,944) | [1] | 83,844 | [1] | (70,150) | [1] | (65,538) | [1] | (238,286) | (127,788) | (223,938) | |
Net income (loss) attributable to Coherus | $ (49,067) | $ (58,989) | $ (55,336) | $ (74,778) | $ (75,921) | [1] | $ 83,939 | [1] | $ (69,967) | [1] | $ (65,388) | [1] | $ (238,170) | $ (127,337) | $ (223,260) | |
Net income (loss) per share attributable to Coherus: | ||||||||||||||||
Net loss per share attributable to Coherus, basic and diluted | $ (0.84) | $ (1.09) | $ (1.08) | $ (1.54) | $ (4.48) | $ (3.04) | $ (6.01) | |||||||||
Basic | [1] | $ (1.71) | $ 1.93 | $ (1.72) | $ (1.67) | |||||||||||
Diluted | [1] | $ (1.71) | $ 1.67 | $ (1.72) | $ (1.67) | |||||||||||
[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 $76.7 million, respectively, as revenue in the three months ended September 30, 2016 (see Note 5), and resulted in net income and net income attributable to Coherus for the three months ended September 30, 2016. |
Supplementary Data - Quarterl74
Supplementary Data - Quarterly Financial Data (Unaudited) - Schedule of Quarterly Financial Information (Parenthetical) (Details) - Baxalta License Agreement - USD ($) | 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 |