Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2020 | Apr. 30, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2020 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | AKBA | |
Title of 12(b) Security | Common Stock, par value $0.00001 per share | |
Security Exchange Name | NASDAQ | |
Entity Registrant Name | AKEBIA THERAPEUTICS, INC. | |
Entity Central Index Key | 0001517022 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Common Stock, Shares Outstanding | 130,265,945 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Shell Company | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Incorporation, State or Country Code | DE | |
Entity Address, Address Line One | 245 First Street | |
Entity Address, City or Town | Cambridge | |
Entity Address, State or Province | MA | |
City Area Code | 617 | |
Local Phone Number | 871-2098 | |
Entity Address, Postal Zip Code | 02142 | |
Entity Tax Identification Number | 20-8756903 | |
Entity File Number | 001-36352 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 115,374,000 | $ 147,449,000 |
Available for sale securities | 0 | 245,000 |
Inventory | 111,854,000 | 116,349,000 |
Accounts receivable, net | 104,872,000 | 38,864,000 |
Prepaid expenses and other current assets | 8,656,000 | 6,626,000 |
Total current assets | 340,756,000 | 309,533,000 |
Property and equipment, net | 9,855,000 | 10,380,000 |
Operating lease assets | 28,026,000 | 29,038,000 |
Goodwill | 55,053,000 | 55,053,000 |
Other intangible assets, net | 282,112,000 | 291,212,000 |
Other assets | 71,917,000 | 75,985,000 |
Total assets | 787,719,000 | 771,201,000 |
Current liabilities: | ||
Accounts payable | 54,379,000 | 39,217,000 |
Accrued expenses and other current liabilities | 124,887,000 | 129,071,000 |
Short-term deferred revenue | 34,886,000 | 39,830,000 |
Total current liabilities | 214,152,000 | 208,118,000 |
Deferred revenue, net of current portion | 42,799,000 | 33,120,000 |
Operating lease liabilities, net of current portion | 26,207,000 | 27,528,000 |
Derivative liability | 1,740,000 | 1,650,000 |
Long-term debt, net | 76,072,000 | 75,805,000 |
Other non-current liabilities | 30,385,000 | 30,223,000 |
Total liabilities | 391,355,000 | 376,444,000 |
Commitments and contingencies (Note 14) | ||
Stockholders' equity: | ||
Preferred stock $0.00001 par value, 25,000,000 shares authorized; 0 shares issued and outstanding at March 31, 2020 and December 31, 2019 | ||
Common stock $0.00001 par value; 175,000,000 shares authorized at March 31, 2020 and December 31, 2019; 130,251,440 and 121,674,568 shares issued and outstanding at March 31, 2020 and December 31, 2019, respectively | 1,000 | 1,000 |
Additional paid-in capital | 1,251,164,000 | 1,188,810,000 |
Accumulated deficit | (854,801,000) | (794,054,000) |
Total stockholders' equity | 396,364,000 | 394,757,000 |
Total liabilities and stockholders' equity | $ 787,719,000 | $ 771,201,000 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2020 | Dec. 31, 2019 |
Statement Of Financial Position [Abstract] | ||
Preferred stock, par value | $ 0.00001 | $ 0.00001 |
Preferred stock, shares authorized | 25,000,000 | 25,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized | 175,000,000 | 175,000,000 |
Common stock, shares issued | 130,251,440 | 121,674,568 |
Common stock, shares outstanding | 130,251,440 | 121,674,568 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Revenues: | ||
Total revenues | $ 88,478 | $ 72,666 |
Cost of goods sold: | ||
Product | $ 18,613 | $ 22,157 |
Type of Cost, Good or Service [Extensible List] | us-gaap:ProductMember | us-gaap:ProductMember |
Amortization of intangibles | $ 9,100 | $ 9,100 |
Total cost of goods sold | 27,713 | 31,257 |
Operating expenses: | ||
Research and development | 81,231 | 82,351 |
Selling, general and administrative | 37,983 | 34,291 |
License expense | 676 | 736 |
Total operating expenses | 119,890 | 117,378 |
Operating loss | (59,125) | (75,969) |
Other income (expense): | ||
Interest income (expense) | (1,972) | 869 |
Other income (expense) | 350 | (78) |
Net loss before income taxes | (60,747) | (75,178) |
Benefit from income taxes | (2,757) | |
Net loss | $ (60,747) | $ (72,421) |
Net loss per share - basic and diluted | $ (0.47) | $ (0.62) |
Weighted-average number of common shares - basic and diluted | 128,395,163 | 117,063,352 |
Comprehensive loss: | ||
Net loss | $ (60,747) | $ (72,421) |
Other comprehensive gain - unrealized gain on debt securities | 225 | |
Total comprehensive loss | (60,747) | (72,196) |
Product Revenue, Net | ||
Revenues: | ||
Total revenues | 29,209 | 23,111 |
License, Collaboration and Other Revenue | ||
Revenues: | ||
Total revenues | $ 59,269 | $ 49,555 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Unrealized Gain/(Loss) | Accumulated Deficit |
Balance at Dec. 31, 2018 | $ 635,928 | $ 1 | $ 1,150,583 | $ (261) | $ (514,395) |
Balance, shares at Dec. 31, 2018 | 116,887,518 | ||||
Proceeds from sale of stock under employee stock purchase plan | 188 | 188 | |||
Proceeds from sale of stock under employee stock purchase plan, shares | 39,977 | ||||
Exercise of options | 365 | 365 | |||
Exercise of options, shares | 62,204 | ||||
Share-based compensation expense | 2,094 | 2,094 | |||
Restricted stock unit vesting, shares | 132,563 | ||||
Unrealized gain | 225 | 225 | |||
Net loss | (72,421) | (72,421) | |||
Balance at Mar. 31, 2019 | 566,379 | $ 1 | 1,153,230 | (36) | (586,816) |
Balance, shares at Mar. 31, 2019 | 117,122,262 | ||||
Balance at Dec. 31, 2018 | 635,928 | $ 1 | 1,150,583 | $ (261) | (514,395) |
Balance, shares at Dec. 31, 2018 | 116,887,518 | ||||
Balance at Dec. 31, 2019 | $ 394,757 | $ 1 | 1,188,810 | (794,054) | |
Balance, shares at Dec. 31, 2019 | 121,674,568 | 121,674,568 | |||
Issuance of common stock, net of issuance costs | $ 56,575 | 56,575 | |||
Issuance of common stock, net of issuance costs, shares | 7,973,967 | ||||
Proceeds from sale of stock under employee stock purchase plan | 451 | 451 | |||
Proceeds from sale of stock under employee stock purchase plan, shares | 115,024 | ||||
Exercise of options | 412 | 412 | |||
Exercise of options, shares | 64,126 | ||||
Share-based compensation expense | 4,916 | 4,916 | |||
Restricted stock unit vesting, shares | 423,755 | ||||
Net loss | (60,747) | (60,747) | |||
Balance at Mar. 31, 2020 | $ 396,364 | $ 1 | $ 1,251,164 | $ (854,801) | |
Balance, shares at Mar. 31, 2020 | 130,251,440 | 130,251,440 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Operating activities: | ||
Net loss | $ (60,747) | $ (72,421) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 525 | 439 |
Amortization of intangibles | 9,100 | 9,100 |
Amortization of premium/discount on investments | (477) | |
Non-cash interest expense | 437 | 169 |
Non-cash operating lease expense | (647) | (614) |
Fair value write-up of inventory sold | 11,180 | 14,586 |
Write-down of inventory | 139 | 1,664 |
Stock-based compensation | 4,916 | 2,094 |
Deferred income taxes | (2,757) | |
Change in fair value of derivative liability | 90 | |
Changes in operating assets and liabilities: | ||
Accounts receivable | (66,008) | (31,769) |
Inventory | (8,163) | (16,064) |
Prepaid expenses and other current assets | (1,898) | 1,317 |
Other long-term assets | 46 | 719 |
Accounts payable | 20,470 | (20,746) |
Accrued expense | (4,209) | (17,500) |
Operating lease liabilities | 445 | 549 |
Deferred revenue | 4,735 | (6,218) |
Net cash used in operating activities | (89,589) | (137,929) |
Investing activities: | ||
Purchase of equipment | (1,928) | |
Proceeds from the maturities of available for sale securities | 245 | 78,691 |
Proceeds from sales of available for sale securities | 33,710 | |
Net cash provided by investing activities | 245 | 110,473 |
Financing activities: | ||
Proceeds from the issuance of common stock, net of issuance costs | 56,485 | |
Proceeds from the sale of stock under employee stock purchase plan | 451 | 188 |
Proceeds from the exercise of stock options | 412 | 365 |
Payments on debt | (15,000) | |
Net cash provided by financing activities | 57,348 | (14,447) |
Increase in cash, cash equivalents, and restricted cash | (31,996) | (41,903) |
Cash, cash equivalents, and restricted cash at beginning of the period | 149,804 | 107,099 |
Cash, cash equivalents, and restricted cash at end of the period | 117,808 | $ 65,196 |
Non-cash financing activities | ||
Unpaid offering costs | $ 90 |
Nature of Organization and Oper
Nature of Organization and Operations | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Nature of Organization and Operations | 1. Nature of Organization and Operations Akebia Therapeutics, Inc., referred to as Akebia or the Company, was incorporated in the State of Delaware in 2007. Akebia is a biopharmaceutical company with the purpose of bettering the lives of people living with kidney disease. Akebia’s lead investigational product candidate, vadadustat, is an oral therapy in Phase 3 development. The Company believes vadadustat has the potential to set a new standard of care in the treatment of anemia due to CKD, acting via a novel hypoxia inducible factor, or HIF, pathway. HIF is the primary regulator of the production of red blood cells, or RBCs, in the body, as well as other important metabolic functions. The Company’s commercial product, Auryxia ® ® . Since inception, the Company has devoted most of its resources to research and development, including its preclinical and clinical development activities, and providing general and administrative support for these operations. The Company began recording revenue from the U.S. sales of Auryxia and revenue from sublicensing rights to Auryxia in Japan to the Company’s Japanese partners Japan Tobacco, Inc. and its subsidiary Torii Pharmaceutical Co., Ltd., collectively, JT and Torii, Keryx Biopharmaceuticals, Inc., or Keryx, or the Merger The Company’s management completed its going concern assessment in accordance with ASC 205-40, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the U.S., or GAAP, for interim financial reporting and as required by Regulation S-X, Rule 10-01. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. Any reference in these notes to applicable guidance is meant to refer to the authoritative U.S. GAAP as found in the Accounting Standards Codification, or ASC, and Accounting Standards Update, or ASU, of the Financial Accounting Standards Board, or FASB. In the opinion of management, all adjustments, consisting of normal recurring accruals and revisions of estimates, considered necessary for a fair presentation of the unaudited condensed consolidated financial statements have been included. Interim results for the three months ended March 31, 2020 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2020 or any other future period. The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Management has determined that the Company operates in one segment, which is the business of developing and commercializing novel therapeutics for people with kidney disease. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the Company’s consolidated financial statements and the accompanying notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 filed with the U.S. Securities and Exchange Commission on March 12, 2020, or the 2019 Annual Report on Form 10-K. The significant accounting policies used in preparation of these unaudited condensed consolidated financial statements for the three months ended March 3 1 , 20 20 are consistent with those discussed in Note 2 to the consolidated financial statements in the Company’s 201 9 Annual Report on Form 10-K and are updated below as necessary. New Accounting Pronouncements – Recently Adopted In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , which requires that financial assets measured at amortized cost be presented at the net amount expected to be collected. Previously, U.S. GAAP delayed recognition of the full amount of credit losses until the loss was probable of occurring. Under this ASU, the income statement will reflect an entity’s current estimate of all expected credit losses. The Company adopted this new standard on January 1, 2020 using the modified retrospective approach, which requires a cumulative-effect adjustment, if any, to the opening balance of retained earnings to be recognized on the date of adoption with prior periods not restated. The cumulative-effect adjustment recorded on January 1, 2020, is not material. Please see the description of the Company’s “Credit Losses” accounting policy in the “Significant Accounting Policies” section below. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement In August 2018, the FASB issued ASU 2018-15, Intangible-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract In November 2018, the FASB issued ASU 2018-18, Collaborative Arrangements (Topic 808): Clarifying the Interaction between Topic 808 and Topic 606 • Clarifies that certain transactions between collaborative arrangement participants should be accounted for as revenue under ASC 606, Revenue from Contracts with Customers , when the collaborative arrangement participant is a customer in the context of a unit of account. In those situations, all the guidance in ASC 606 should be applied, including recognition, measurement, presentation and disclosure requirements; • Adds unit-of-account guidance to ASC 808, Collaborative Arrangements , to align with the guidance in ASC 606 (that is, a distinct good or service) when an entity is assessing whether the collaborative arrangement or a part of the arrangement is within the scope of ASC 606; and • Precludes a company from presenting transactions with collaborative arrangement participants that are not directly related to sales to third parties with revenue recognized under ASC 606 if the collaborative arrangement participant is not a customer. This standard became effective for the Company on January 1, 2020, and did not have a material impact on the Company’s unaudited condensed consolidated financial statements and related disclosures. New Accounting Pronouncements – Not Yet Adopted In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. and related disclosures Derivative Financial Instruments The Company accounts for warrants and other derivative financial instruments as either equity or liabilities in accordance with ASC Topic 815, Derivatives and Hedging, or ASC 815, based upon the characteristics and provisions of each instrument. Warrants classified as equity are recorded at fair value as of the date of issuance on the Company’s consolidated balance sheets and no further adjustments to their valuation are made. Warrants classified as derivative liabilities and other derivative financial instruments that require separate accounting as liabilities are recorded on the Company’s consolidated balance sheets at their fair value on the date of issuance and will be revalued on each subsequent balance sheet date until such instruments are exercised or expire, with any changes in the fair value between reporting periods recorded as other income or expense. The warrant issued by the Company in connection with the Janssen Pharmaceutica NV Research and License Agreement, the Janssen Agreement, is classified as equity in the Company’s consolidated bal ance sheet. (See Note 12). The derivative liability recorded in connection with the Company’s Loan Agreement with Pharmakon is classified as a liability in the Company’s consolidated balance sheet. (See Note 11). Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results may differ from those estimates. Management considers many factors in selecting appropriate financial accounting policies and controls, and in developing the estimates and assumptions that are used in the preparation of these financial statements. Management must apply significant judgment in this process. In addition, other factors may affect estimates, including expected business and operational changes, sensitivity and volatility associated with the assumptions used in developing estimates, and whether historical trends are expected to be representative of future trends. The estimation process often may yield a range of potentially reasonable estimates of the ultimate future outcomes, and management must select an amount that falls within that range of reasonable estimates. Estimates are used in the following areas, among others: prepaid and accrued research and development expense, operating lease assets and liabilities, derivative liabilities, other non-current liabilities, stock-based compensation expense, product and collaboration revenues including various rebates and reserves related to product sales, inventories, income taxes, intangible assets and goodwill. The Company has made estimates of the impact of COVID-19 within the unaudited condensed consolidated financial statements and there may be changes to those estimates in future periods including changes to sales, payer mix, reserves and allowances, intangible assets and goodwill. While the COVID-19 pandemic has not had a material adverse impact on the Company’s financial condition, the future impacts of the pandemic and any resulting economic impact is largely unknown and rapidly evolving. Credit Losses Available for sale debt securities. Management determines the appropriate classification of securities at the time of purchase and reevaluates such designation as of each balance sheet date. The Company classifies all securities as available for sale and includes them in current assets as they are intended to fund current operations. The Company's investment portfolio at any point in time contains investments in money market mutual funds, U.S. government debt securities, certificates of deposit and corporate debt securities. The Company segments its portfolio based on the underlying risk profiles of the securities and have a zero loss expectation for money market mutual funds, U.S. government debt securities and certificates of deposit. The Company regularly reviews the securities in an unrealized loss position and evaluates the current expected credit loss by considering factors such as historical experience, market data, issuer-specific factors, and current economic conditions. During the quarter ended March 31, 2020, the Company’s only available for sales securities consisted of certificates of deposit and therefore the Company did not recognize any credit losses. Cash, Cash Equivalents, and Restricted Cash Cash and cash equivalents consist of all cash on hand, deposits and funds invested in available for sale securities with original maturities of three months or less at the time of purchase. Cash equivalents are reported at fair value. At March 31, 2020, the Company’s cash is primarily in money market funds. The Company may maintain balances with its banks in excess of federally insured limits. Restricted cash represents amounts required for security deposits under the Company’s office and lab space lease agreements and, at March 31, 2019, cash balances held as collateral for the Company’s employee credit card program. Restricted cash is included in “prepaid expenses and other current assets” and “other assets” in the unaudited condensed consolidated balance sheets. The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported in the unaudited condensed consolidated balance sheet that sum to the total of the amounts reported in the unaudited condensed consolidated statement of cash flows (in thousands): March 31, 2020 March 31, 2019 Cash and cash equivalents $ 115,374 $ 62,741 Prepaid expenses and other current assets 395 263 Other assets 2,039 2,192 Total cash, cash equivalents, and restricted cash shown in the statement of cash flows $ 117,808 $ 65,196 Property and Equipment Property and equipment is stated at cost, less accumulated depreciation. Assets under capital lease are included in property and equipment. Property and equipment is depreciated using the straight-line method over the estimated useful lives of the assets, generally three to seven years. Such costs are periodically reviewed for recoverability when impairment indicators are present. Such indicators include, among other factors, operating losses, unused capacity, market value declines and technological obsolescence. Recorded values of asset groups of equipment that are not expected to be recovered through undiscounted future net cash flows are written down to current fair value, which generally is determined from estimated discounted future net cash flows (assets held for use) or net realizable value (assets held for sale). The following is the summary of property and equipment and related accumulated depreciation as of March 31, 2020 and December 31, 2019. Useful Life March 31, 2020 December 31, 2019 (in thousands) Computer equipment and software 3 $ 1,010 $ 1,010 Furniture and fixtures 5 - 7 2,086 2,086 Equipment 7 2,451 2,451 Leasehold improvements Shorter of the useful life or remaining lease term (10 years) 8,497 8,497 14,044 14,044 Less accumulated depreciation (4,189 ) (3,664 ) Net property and equipment $ 9,855 $ 10,380 Depreciation expense was approximately $0.5 million and $0.4 million for the three months ended March 31, 2020 and 2019, respectively. Inventory The Company values its inventories at the lower-of-cost or net realizable value. The Company determines the cost of its inventories, which includes amounts related to materials and manufacturing overhead, on a first-in, first-out basis. The Company classifies its inventory costs as long-term, in other assets in its unaudited condensed consolidated balance sheets, when it expects to utilize the inventory beyond their normal operating cycle. Prior to the regulatory approval of its product candidates, the Company incurs expenses for the manufacture of material that could potentially be available to support the commercial launch of its products. Until the first reporting period when regulatory approval has been received or is otherwise considered probable and the future economic benefit is expected to be realized, the Company records all such costs as research and development expense. Inventory used in clinical trials is also expensed as research and development expense, when selected for such use. Inventory that can be used in either the production of clinical or commercial products is expensed as research and development costs when identified for use in a clinical manufacturing campaign. The Company performs an assessment of the recoverability of capitalized inventory during each reporting period, and writes down any excess and obsolete inventory to its net realizable value in the period in which the impairment is first identified. Such impairment charges, should they occur, are recorded as a component of cost of product sales in the unaudited condensed consolidated statements of operations and comprehensive loss. The determination of whether inventory costs will be realizable requires the use of estimates by management. If actual market conditions are less favorable than projected by management, additional write-downs of inventory may be required. Additionally, the Company’s product is subject to strict quality control and monitoring that it performs throughout the manufacturing process. In the event that certain batches or units of product no longer meet quality specifications, the Company will record a charge to cost of product sales to write-down any unmarketable inventory to its estimated net realizable value. In all cases, product inventory is carried at the lower of cost or its estimated net realizable value. Debt The Company performs an assessment of all embedded features of a debt instrument to determine if (1) such features should be bifurcated and separately accounted for, and (2) if bifurcation requirements are met, whether such features should be classified and accounted for as equity or liability instruments. If the embedded feature meets the requirements to be bifurcated and accounted for as a liability, the fair value of the embedded feature is measured initially, included as a liability on the unaudited condensed unaudited condensed Revenue Recognition The Company generates revenues primarily from sales of Auryxia, see Note 3, and from its collaborations with MTPC and Otsuka, see Note 4. The Company recognizes revenue in accordance with ASC 606, which applies to all contracts with customers, except for contracts that are within the scope of other standards. Under ASC 606, the Company recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that the Company determines are within the scope of ASC 606, it performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company assesses the goods or services promised within each contract and determines those that are performance obligations, and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. The Company does not include a financing component to its estimated transaction price at contract inception unless it estimates that certain performance obligations will not be satisfied within one year. Additionally, the Company recognizes the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that the Company otherwise would have recognized is one year or less. Product Revenue, Net The Company sells Auryxia in the United States, or U.S., primarily to wholesale distributors as well as certain specialty pharmacy providers, collectively, Customers. These Customers resell the Company’s product to health care providers and patients. In addition to distribution agreements with Customers, the Company enters into arrangements with health care providers and payors that provide for government-mandated and/or privately-negotiated rebates, chargebacks, and discounts with respect to the purchase of the Company’s product. The Company recognizes revenue on product sales when the Customer obtains control of the Company’s product, which occurs at a point in time, typically upon delivery to the Customer. The Company expenses incremental costs of obtaining a contract as and when incurred if the expected amortization period of the asset that it would have recognized is one year or less. Reserves for Variable Consideration Revenue from product sales is recorded at the net sales price (transaction price), which includes estimates of variable consideration for which reserves are established and which result from discounts, returns, chargebacks, rebates, co-pay assistance and other allowances that are offered within contracts between the Company and its Customers, health care providers, payors and other indirect customers relating to the Company’s sales of its products. These reserves are based on the amounts earned or to be claimed on the related sales and are classified as reductions of accounts receivable (if the amount will be credited to the Customer) or as a current liability (if the amount is payable to a Customer or a party other than a Customer). When appropriate, t hese estimates take into consideration a range of possible outcomes which are probability-weighted in accordance with the expected value method in ASC 606 for relevant factors such as the Company’s historical experience, current contractual and statutory requirements, specific known market events and trends, industry data, and forecasted customer buying and payment patterns. Overall, these reserves reflect the Company’s best estimates of the amount of consideration to which it is entitled based on the terms of the respective underlying contracts. The amount of variable consideration that is included in the transaction price may be constrained, and is included in the net sales price only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period. Actual amounts of consideration ultimately received may differ from the Company’s estimates. If actual results in the future vary from the Company’s estimates, the Company will adjust these estimates, which would affect net product revenue and earnings in the period such variances become known. Trade Discounts and Allowances: The Company generally provides Customers with discounts that include incentive fees that are explicitly stated in the Company’s contracts and are recorded as a reduction of revenue in the period the related product revenue is recognized. In addition, the Company compensates (through trade discounts and allowances) its Customers for sales order management, data, and distribution services. However, the Company has determined such services received to date are not distinct from the Company’s sale of products to the Customer and, therefore, these payments have been recorded as a reduction of revenue within the unaudited condensed consolidated statement of operations and comprehensive loss through March 31, 2020. The Company records a corresponding reduction of accounts receivable (if the trade discount and/or allowance will be credited to the Customer) or an increase in accrued expense (if the trade discount and/or allowance is payable to a Customer) on the unaudited condensed consolidated balance sheets. Product Returns: Consistent with industry practice, the Company generally offers Customers a limited right of return which allows for the product to be returned when the product expiry is within an allowable window. This right of return lapses once the product is provided to a patient. The Company estimates the amount of its product sales that may be returned by its Customers and records this estimate as a reduction of revenue in the period the related product revenue is recognized. The Company currently estimates product return reserve using available industry data and its own historical sales information, including its visibility into the inventory remaining in the distribution channel. Provider Chargebacks and Discounts : Chargebacks for fees and discounts to providers represent the estimated obligations resulting from contractual commitments to sell products to qualified healthcare providers at prices lower than the list prices charged to Customers who directly purchase the product from the Company. Customers charge the Company for the difference between what they pay for the product and the ultimate selling price to the qualified healthcare providers. These reserves are established in the same period that the related revenue is recognized, resulting in a reduction of product revenue and accounts receivable. Chargeback amounts are generally determined at the time of resale to the qualified healthcare provider by Customers, and the Company generally issues credits for such amounts within a few weeks of the Customer’s resale of the product. Reserves for chargebacks consist of credits that the Company expects to issue for units that remain in the distribution channel at each reporting period end that the Company expects will be sold to qualified healthcare providers, and chargebacks that Customers have claimed but for which the Company has not yet issued a credit. Commercial and Medicare Part D Rebates: The Company contracts with various commercial payor organizations, primarily health insurance companies and pharmacy benefit managers, for the payment of rebates with respect to utilization of its products. The Company estimates the rebates for commercial and Medicare Part D payors based upon (i) its contracts with the payors and (ii) information obtained from its Customers and other third parties regarding the payor mix for Auryxia. The Company estimates these rebates and records such estimates in the same period the related revenue is recognized, resulting in a reduction of product revenue and the establishment of a current liability. Other Government Rebates: The Company is subject to discount obligations under state Medicaid programs and other government programs. The Company estimates its Medicaid and other government programs rebates based upon a range of possible outcomes that are probability-weighted for the estimated payor mix. These reserves are recorded in the same period the related revenue is recognized, resulting in a reduction of product revenue and the establishment of a current liability which is included in accrued expenses and other current liabilities on the unaudited condensed consolidated balance sheets. For Medicare, the Company also estimates the number of patients in the prescription drug coverage gap for whom the Company will owe an additional liability under the Medicare Part D program. The Company’s liability for these rebates consists of invoices received for claims from prior quarters that have not been paid or for which an invoice has not yet been received, estimates of claims for the current quarter, and estimated future claims that will be made for product that has been recognized as revenue, but which remains in the distribution channel at the end of each reporting period. Other Incentives: Other incentives that the Company offers include voluntary patient assistance programs such as the Company’s co-pay assistance program, which are intended to provide financial assistance to qualified commercially insured patients with prescription drug co-payments required by payors. The calculation of the accrual for co-pay assistance is based on actual claims processed during a given period, as well as historical utilization data to estimate the amount the Company expects to receive associated with product that has been recognized as revenue, but remains in in the distribution channel at the end of each reporting period. Collaboration Revenues The Company enters into out-license and collaboration agreements which are within the scope of ASC 606, under which it licenses certain rights to its product candidates to third parties. The terms of these arrangements typically include payment to the Company of one or more of the following: non-refundable, up-front license fees; development, regulatory, and commercial milestone payments; payments for manufacturing supply services the Company provides through its contract manufacturers; and royalties on net sales of licensed products. Each of these payments may result in license, collaboration and other revenue, except for revenues from royalties on net sales of licensed products, which are classified as royalty revenues. In determining the appropriate amount of revenue to be recognized as the Company fulfills its obligations under each of its agreements, the Company implements the five-step model noted above. As part of the accounting for these arrangements, the Company must develop assumptions that require judgment to determine whether the individual promises should be accounted for as separate performance obligations or as a combined performance obligation, and to determine the stand-alone selling price for each performance obligation identified in the contract. A deliverable represents a separate performance obligation if both of the following criteria are met: (i) the customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer, and (ii) the entity’s promise to transfer the good or service to the customer is separately identifiable from other promises in the contract. The Company uses key assumptions to determine the stand-alone selling price, which may include forecasted revenues, development timelines, reimbursement rates for personnel costs, discount rates, and probabilities of technical and regulatory success. With regard to the MTPC and Otsuka collaboration agreements, the Company recognizes revenue related to amounts allocated to the identified performance obligation on a proportional performance basis as the underlying services are performed. Licenses of Intellectual Property If the license to the Company’s intellectual property is determined to be distinct from the other performance obligations identified in an out-license and collaboration arrangement, the Company recognizes revenue from non-refundable, up-front fees allocated to the license when the license is transferred to the customer and the customer is able to use and benefit from the license. For licenses that are bundled with other promises, the Company utilizes judgment to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue from non-refundable, up-front fees. The Company evaluates the measure of progress each reporting period and, if necessary, adjust the measure of performance and related revenue recognition. Milestone Payments At the inception of each arrangement that includes development milestone payments, the Company evaluates whether the milestones are considered probable of being reached and estimates the amount to be included in the transaction price using the most likely amount method. The Company evaluates factors such as the scientific, clinical, regulatory, commercial, and other risks that must be overcome to assess the milestone as probable of being achieved. There is considerable judgment involved in determining whether a milestone is probable of being reached at each specific reporting period. Milestone payments that are not within the control of the Company or the customer, such as regulatory approvals, are not considered probable of being achieved until those approvals are received. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price. The transaction price is then allocated to each performance obligation on a relative stand-alone selling price basis, for which the Company recognizes revenues as, or when, the performance obligations under the contract are satisfied. At the end of each subsequent reporting period, the Company re-evaluates the probability of achievement of such development milestones and any related constraint, and if necessary, adjusts its estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, which would affect collaboration revenue in the period of adjustment. Manufacturing Supply Services Arrangements that include a promise for future supply of drug substance or drug product for either clinical development or commercial supply at the licensee’s discretion are generally considered as options. The Company assesses if these options provide a material right to the licensee and if so, they are accounted for as separate performance obligations. If the Company is entitled to additional payments when the licensee exercises these options, any additional payments are recorded in license, collaboration and other revenues when the licensee obtains control of the goods, which is upon delivery. Royalties The Company will recognize sales-based royalties, including milestone payments based on the level of sales, at the later of (i) when the related sales occur, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied). The Company receives royalty payments from JT and Torii, based on net sales of Riona in Japan. Collaborative Arrangements The Company records the elements of its collaboration agreements that represent joint operating activities in accordance with ASC Topic 808, Collaborative Arrangements Revenue from Contracts with Customers – Scope and Scope Exceptions During the three months ended March 31, 2020 and 2019, the Company incurred approximately $0.5 million and $0.3 million, respectively, of costs related to the cost-sharing provisions of the Otsuka U.S. Agreement, of which approximately $0.3 million and $0.2 million are reimbursable by Otsuka and recorded as a reduction to research and development expense during the three months ended March 31, 2020 and 2019, respectively. March 31, 2020 and 2019 March 31, 2020 and 2019 Intangible The Company maintains a definite-lived intangible asset related to developed product rights for Auryxia, which was acquired on December 12, 2018 as part of the Merger. Intangible assets are initially recorded at fair value and stated net of accumulated amortization and impairments. The Co |
Product Revenue and Reserves fo
Product Revenue and Reserves for Variable Consideration | 3 Months Ended |
Mar. 31, 2020 | |
Revenue From Contract With Customer [Abstract] | |
Product Revenue and Reserves for Variable Consideration | 3. Product Revenue and Reserves for Variable Consideration To date, the Company’s only source of product revenue has been product revenue from the U.S. sales of Auryxia, which it began recording on December 12, 2018 following the consummation of the Merger. Total net product revenue was $29.2 million and $23.1 million for the three months ended March 31, 2020 and 2019, respectively. The following table summarizes activity in each of the product revenue allowance and reserve categories for the three months ended March 31, 2020 and 2019 (in thousands): Chargebacks and Discounts Rebates, Fees and other Deductions Returns Total Balance at December 31, 2019 $ 738 $ 30,552 $ 253 $ 31,543 Current provisions related to sales in current year 2,250 30,519 1,053 33,822 Adjustments related to prior year sales 82 32 — 114 Credits/payments made (2,353 ) (29,024 ) (1,051 ) (32,428 ) Balance at March 31, 2020 $ 717 $ 32,079 $ 255 $ 33,051 Balance at December 31, 2018 $ 516 $ 22,861 $ 360 $ 23,737 Current provisions related to sales in current year 1,486 17,476 870 19,832 Adjustments related to prior year sales — 156 — 156 Credits/payments made (1,495 ) (17,301 ) (947 ) (19,743 ) Balance at March 31, 2019 $ 507 $ 23,192 $ 283 $ 23,982 Chargebacks, discounts and returns are recorded as a direct reduction of revenue on the unaudited condensed consolidated statement of operations with a corresponding reduction to accounts receivable on the unaudited condensed consolidated balance sheets. Rebates, distribution-related fees, and other sales-related deductions are recorded as a reduction in revenue on the unaudited condensed consolidated statement of operations with a corresponding increase to accrued liabilities or accounts payable on the unaudited condensed consolidated balance sheets. Accounts receivable, net related to product sales was approximately $20.2 million and $23.0 million as of March 31, 2020 and December 31, 2019, respectively. |
License, Collaboration and Othe
License, Collaboration and Other Significant Agreements | 3 Months Ended |
Mar. 31, 2020 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
License, Collaboration and Other Significant Agreements | 4. License, Collaboration and Other Significant Agreements During the three months ended March 31, 2020 and 2019, the Company recognized the following revenues from its license, collaboration and other significant agreements and had the following deferred revenue balances as of March 31, 2020: Three Months Ended March 31, 2020 2019 License, Collaboration and Other Revenue: (in thousands) Otsuka U.S. Agreement $ 38,577 $ 26,223 Otsuka International Agreement 19,370 21,956 Total Proportional Performance Revenue $ 57,947 $ 48,179 JT and Torii 1,126 1,228 MTPC Other Revenue 196 148 Total License, Collaboration and Other Revenue $ 59,269 $ 49,555 March 31, 2020 Short-Term Long-Term Total Deferred Revenue: (in thousands) Otsuka U.S. Agreement $ 19,090 $ 26,854 $ 45,944 Otsuka International Agreement 11,807 11,266 23,073 MTPC - Supply of Validation Drug Product 3,989 — 3,989 Vifor Agreement — 4,679 4,679 Total $ 34,886 $ 42,799 $ 77,685 The following table presents changes in the Company’s contract assets and liabilities during the three months ended March 31, 2020 and 2019 (in thousands): Three Months Ended March 31, 2020 Balance at Beginning of Period Additions Deductions Balance at End of Period Contract assets: Accounts receivable (1) $ 15,822 $ 71,639 $ (2,895 ) $ 84,566 Prepaid expenses and other current assets $ — $ 546 $ — $ 546 Contract liabilities: Deferred revenue $ 72,950 $ 65,209 $ (60,474 ) $ 77,685 Accrued expenses and other current liabilities $ — $ 615 $ — $ 615 Three Months Ended March 31, 2019 Contract assets: Accounts receivable (1) $ 1,587 $ 30,387 $ (2,041 ) $ 29,933 Contract liabilities: Deferred revenue $ 112,689 $ 41,962 $ (48,180 ) $ 106,471 Accounts payable $ 13,492 $ — $ (13,492 ) $ — (1) During the three months ended March 31, 2020 and 2019, the Company recognized the following revenues as a result of changes in the contract asset and contract liability balances in the respective periods (in thousands): Three Months Ended March 31, Revenue Recognized in the Period from: 2020 2019 Amounts included in deferred revenue at the beginning of the period $ 10,130 $ 45,179 Performance obligations satisfied in previous periods $ — $ 1,254 Mitsubishi Tanabe Pharma Corporation Collaboration Agreement Summary of Agreement On December 11, 2015, the Company and MTPC entered into a collaboration agreement, or the MTPC Agreement, providing MTPC with exclusive development and commercialization rights to vadadustat in Japan and certain other Asian countries, collectively, the MTPC Territory. In addition, the Company will supply vadadustat for both clinical and commercial use in the MTPC Territory, subject to MTPC’s option to manufacture commercial drug product in the MTPC Territory. The Company and MTPC agreed that, instead of including Japanese patients in the Company’s global Phase 3 program for vadadustat, MTPC would be the sponsor of a Phase 3 program for vadadustat in Japan. MTPC reported top-line data for the two Phase 3 pivotal trials and data from the two supportive Phase 3 studies in March 2019 and 52-week data for the two Phase 3 pivotal trials in November 2019. MTPC is responsible for the costs of the Phase 3 program in Japan and other studies required in Japan, and will make no funding payments for the global Phase 3 program. In July 2019, MTPC submitted a Japanese New Drug Application, or JNDA, to the Ministry of Health, Labor and Welfare in Japan for manufacturing and marketing approval of vadadustat, as a treatment for anemia due to CKD, which triggered a $10.0 million regulatory milestone payment to the Company. MTPC has sole responsibility for the commercialization of vadadustat in the MTPC Territory as well as for Medical Affairs (as defined in the MTPC Agreement) in the MTPC Territory. Akebia is responsible for manufacturing and supplying vadadustat for clinical use in the MTPC Territory. The Company and MTPC have established a joint steering committee pursuant to the MTPC Agreement to oversee development and commercialization of vadadustat in the MTPC Territory, including approval of any development or commercialization plans. Unless earlier terminated, the MTPC Agreement will continue in effect on a country-by-country basis until the later of the following: expiration of the last-to-expire patent covering vadadustat in such country in the MTPC Territory; expiration of marketing or regulatory exclusivity in such country in the MTPC Territory; or ten years after the first commercial sale of vadadustat in such country in the MTPC Territory. MTPC may terminate the MTPC Agreement upon twelve months’ notice at any time after the second anniversary of the effective date of the MTPC Agreement. Either party may terminate the MTPC Agreement upon the material breach of the other party that is not cured within a specified time period or upon the insolvency of the other party. MTPC is required to make certain milestone payments to the Company aggregating up to approximately $225.0 million upon the achievement of specified development, regulatory and commercial events. More specifically, the Company received $10.0 million in development milestone payments, and is eligible to receive up to $40.0 million in regulatory milestone payments, of which the Company received $10.0 million in relation to the JNDA filing in the third quarter of 2019 and is eligible to receive an additional $15.0 million upon regulatory approval of vadadustat in Japan, and up to $175.0 million in commercial milestone payments associated with aggregate sales of all products. In consideration for the exclusive license and other rights contained in the MTPC Agreement, MTPC also made a $20.0 million upfront payment as well as a payment of $20.5 million for Phase 2 studies in Japanese patients completed by the Company and reimbursed by MTPC. Additionally, if vadadustat is commercialized, the Company would be entitled to receive tiered double-digit royalty payments of up to 20% on sales of vadadustat in the MTPC Territory. Royalty payments are subject to certain reductions, including upon the introduction of competitive products in certain instances. Royalties are due on a country-by-country basis from the date of first commercial sale of a licensed product in a country until the last to occur of: (i) the expiration of the last to expire valid claim within the intellectual property covering the licensed product, (ii) the expiration of marketing or regulatory exclusivity in such country, or (iii) the tenth anniversary of the first commercial sale of such licensed product in such country. Due to the uncertainty of pharmaceutical development and the high historical failure rates associated with drug development, although the Company has received $10.0 million in development milestones and a $10.0 million regulatory milestone, no additional milestone or royalty payments may ever be received from MTPC. In September 2017, the Company provided MTPC with an option to use data from the Company’s global Phase 3 vadadustat program to obtain regulatory approval for vadadustat in Japan. If exercised, MTPC would make payments to the Company of up to $25.0 million, which is in addition to the milestone payments described above. Revenue Recognition The Company evaluated the elements of the MTPC Agreement in accordance with the provisions of ASC 606 and concluded that the contract counterparty, MTPC, is a customer. The Company’s arrangement with MTPC contains the following material promises under the contract at inception: (i) license under certain of the Company’s intellectual property to develop and commercialize vadadustat (the License Deliverable) in the MTPC Territory, (ii) clinical supply of vadadustat (the Clinical Supply Deliverable), (iii) knowledge transfer, (iv) Phase 2 dosing study research services (the Research Deliverable), and (v) rights to future know-how. The Company has identified two performance obligations in connection with its material promises under the MTPC Agreement as follows: (i) License, Research and Clinical Supply Performance Obligation and (ii) Rights to Future Know-How Performance Obligation The Company allocates the transaction price to each performance obligation based on the Company’s best estimate of the relative standalone selling price. The Company developed a best estimate of the standalone selling price for the Rights to Future Know-How Performance Obligation primarily based on the likelihood that additional intellectual property covered by the license conveyed will be developed during the term of the arrangement. The Company did not develop a best estimate of standalone selling price for the License, Research and Clinical Supply Performance Obligation because the estimate of standalone selling price associated with the Rights to Future Know-How Performance Obligation was determined to be immaterial. The Company has concluded that a change in the key assumptions used to determine the best estimate of standalone selling price for each performance obligation would not have a significant impact on the allocation of arrangement consideration. The deliverables associated with the License, Research and Clinical Supply Performance Obligation were satisfied as of June 30, 2018. The transaction price at inception was comprised of: (i) the up-front payment, (ii) the estimated cost for the Phase 2 studies, (iii) a non-substantive milestone associated with the first patient enrolled in the NDD-CKD Phase 3 study, and (iv) the cost of all clinical supply provided to MTPC for the Phase 3 studies. No other development and no regulatory milestones were included in the transaction price at inception, as all other milestone amounts were fully constrained. As part of its evaluation of the constraint, the Company considered numerous factors, including that receipt of the milestones is outside the control of the Company and contingent upon success in future clinical trials and the licensee’s efforts. The total aggregate amount of development milestones is $10.0 million and the total aggregate amount of the regulatory milestones is up to $40.0 million. The total aggregate amount of sales milestones is up to $175.0 million. Any consideration related to sales-based milestones (including royalties) will be recognized when the related sales occur as they were determined to relate predominantly to the license granted to MTPC and therefore have also been excluded from the transaction price. The Company re-evaluates the transaction price in each reporting period and as uncertain events are resolved or other changes in circumstances occur. As of March 31, 2020, the transaction price is comprised of: (i) the up-front payment of $20.0 million, (ii) the cost for the Phase 2 studies of $20.5 million, (iii) the cost of all clinical supply provided to MTPC for the Phase 3 studies, (iv) $10.0 million in development milestones received, comprised of a $6.0 million and a $4.0 million development milestone, and (v) the $10.0 million regulatory milestone relating to the JNDA filing. As of March 31, 2020, all development milestones and a $10.0 million regulatory milestone related to the filing of the JNDA have been achieved. No other regulatory milestones have been assessed as probable of being achieved and as a result have been fully constrained. Revenue for the License, Research and Clinical Supply Performance Obligation for the MTPC Agreement is being recognized using a proportional performance method, for which all deliverables have been completed. No revenues were recognized for the three months ended March 31, 2020 and 2019 with respect to the MTPC Agreement. As of March 31, 2020, there is no deferred revenue, no accounts receivable, and no contract assets. There were no asset or liability balances classified as long-term in the unaudited condensed consolidated balance sheet as of March 31, 2020. Supply of Validation Drug Product The Company is advancing key pre-commercial activities in support of the first regulatory approval of vadadustat expected in Japan this year. As a result, in March 2020, in connection with the MTPC agreement, the Company agreed to supply MTPC with certain vadadustat drug product for commercial use U.S. Collaboration and License Agreement with Otsuka Pharmaceutical Co. Ltd. Summary of Agreement On December 18, 2016, the Company entered into a collaboration and license agreement with Otsuka, or the Otsuka U.S. Agreement. The collaboration is focused on the development and commercialization of vadadustat in the United States. Under the terms of the Otsuka U.S. Agreement, the Company is responsible for leading the development of vadadustat, including the ongoing Phase 3 development program. The Company and Otsuka will co-commercialize vadadustat in the United States, subject to the approval of vadadustat by the FDA. Under the terms of the Otsuka U.S. Agreement, the Company granted to Otsuka a co-exclusive, non-sublicensable license under certain intellectual property controlled by the Company solely to perform medical affairs activities and to conduct non-promotional and commercialization activities related to vadadustat in accordance with the associated plans. The co-exclusive license relates to activities that will be jointly conducted by the Company and Otsuka pursuant to the terms of the Otsuka U.S. Agreement. Additionally, the parties agreed not to promote, market or sell any competing product in the territory covered by the agreement. The Company is responsible for performing all activities related to the development of vadadustat as outlined in the current global development plan, while Otsuka may agree to perform certain activities under the global development plan from time to time as agreed by the parties. The current global development plan encompasses all activities with respect to the ongoing PRO 2 2 Under the Otsuka U.S. Agreement, the parties jointly conduct, and have equal responsibility for, all medical affairs, commercialization and non-promotional activities pursuant to underlying plans as agreed to by the parties. If approved by the FDA, the Company plans to provide vadadustat to Otsuka for commercialization pursuant to a separate supply agreement to be negotiated. The activities under the Otsuka U.S. Agreement are governed by a joint steering committee, or JSC, formed by an equal number of representatives from the Company and Otsuka. The JSC coordinates and monitors the parties’ activities under the collaboration. Among other responsibilities, the JSC manages the overall strategic alignment between the parties, oversees the current global development plan and reviews other detailed plans setting forth the parties’ activities under the arrangement, including the medical affairs plan and commercialization and non-promotional activities plan. Additionally, the parties established a joint development committee, or JDC, which is comprised of an equal number of representatives from the Company and Otsuka. Among other responsibilities, the JDC shares information related to, and reviews and discusses activities and progress under, the current global development plan and any other development that may be conducted pursuant to the collaboration. The Company and Otsuka also established a joint manufacturing committee, or JMC, which is comprised of an equal number of representatives from each of the parties. Among other responsibilities, the JMC oversees the manufacturing plan and related manufacturing activities. In support of the potential commercialization of vadadustat, the parties established a joint commercialization committee, or JCC, which is comprised of an equal number of representatives from the Company and Otsuka. Among other responsibilities, the JCC oversees the activities and progress under the commercialization and non-promotional activities plan and all other sales and marketing activities. The Company has retained final decision-making authority with respect to certain matters, including U.S. pricing strategy and certain other key commercialization matters. Under the terms of the Otsuka U.S. Agreement, the Company received a $125.0 million up-front, non-refundable, non-creditable cash payment in December 2016. In March 2017, the Company received a payment of approximately $33.8 million, which represented reimbursement for Otsuka’s share of costs previously incurred by the Company in implementing the current global development plan through December 31, 2016. Commencing in the third quarter of 2017, whereupon the Company had incurred a specified amount of incremental costs, Otsuka began to contribute, as required by the Otsuka U.S. Agreement, a percentage of the remaining costs incurred under the current global development plan. The Company estimates that Otsuka’s funding of the current global development plan costs subsequent to December 31, 2016 will total $279.9 million or more, depending on the actual costs incurred toward the current global development plan. The costs associated with the performance of any development activities in addition to those outlined in the current global development plan will be subject to a cost sharing or reimbursement mechanism as set forth in the Otsuka U.S. Agreement or to be determined by the parties. Costs incurred with respect to medical affairs and commercialization and non-promotional activities will generally be shared equally by the parties. In addition, due to the costs incurred in completing the activities under the current global development plan exceeding a certain threshold in the second quarter of 2019, the Company elected to require Otsuka to increase the aggregate percentage of current global development costs it funds under the Otsuka U.S. Agreement and the Otsuka International Agreement, as defined below, from 52.5% to 80%, or the Otsuka Funding Option. The Company estimates the additional funding as a result of exercising the Otsuka Funding Option, or In addition, Otsuka is required to make certain milestone payments to the Company upon the achievement of specified development, regulatory and commercial events. More specifically, as of March 31, 2020, the Company is eligible to receive up to $125.0 million in development milestone payments, up to $65.0 million in regulatory milestone payments for the first product to achieve the associated event, and up to $575.0 million in commercial milestone payments associated with aggregate sales of licensed products. These future milestones are subject to reduction as a result of the Company’s exercise of the Otsuka Funding Option, as described above, the Additional Funding for which, as of March 31, 2020, totaled $60.0 million. Due to the uncertainty of pharmaceutical development and the high historical failure rates associated therewith, no milestone payments may ever be received from Otsuka. Under the Otsuka U.S. Agreement, the Company and Otsuka share the costs of developing and commercializing vadadustat in the United States and the profits from the sales of vadadustat after approval by the FDA. In connection with the profit share calculation, net sales include gross sales to third-party customers net of discounts, rebates, chargebacks, taxes, freight and insurance charges and other applicable deductions. Shared costs generally include costs attributable or reasonably allocable to the manufacture of vadadustat for commercialization purposes and the performance of medical affairs activities, non-promotional activities and commercialization activities. Unless earlier terminated, the Otsuka U.S. Agreement will expire in the United States on a product-by-product basis on the date that one or more generic versions of vadadustat first achieves 90% market penetration. Either party may terminate the Otsuka U.S. Agreement in its entirety upon an uncured breach or insolvency on the part of the other party. Otsuka may terminate the Otsuka U.S. Agreement in its entirety upon 12 months’ prior written notice at any time after the release of the first top-line data from the global Phase 3 development program for vadadustat. In the event of termination of the Otsuka U.S. Agreement, all rights and licensees granted to Otsuka under the Otsuka U.S. Agreement will automatically terminate and the licenses granted to the Company will become freely sublicensable. In addition, the upfront payment, all development costs and milestone payments received by the Company prior to such termination will not be refunded to Otsuka. Revenue Recognition The Company evaluated the elements of the Otsuka U.S. Agreement in accordance with the provisions of ASC 606 and concluded that the contract counterparty, Otsuka, is a customer. The Company’s arrangement with Otsuka contains the following material promises under the contract at inception: (i) license under certain of the Company’s intellectual property to develop, perform medical affairs activities with respect to and conduct non-promotional and commercialization activities related to vadadustat and products containing or comprising vadadustat (the License Deliverable), (ii) development services to be performed pursuant to the current global development plan (the Development Services Deliverable), (iii) rights to future intellectual property (the Future IP Deliverable), and (iv) joint committee services (the Committee Deliverable). The Company has identified three performance obligations in connection with its obligations under the Otsuka U.S. Agreement. Factors considered in making the assessment of which material promises will be accounted for as separate performance obligations included, among other things, the capabilities of the collaboration partner, whether any other vendor sells the item separately, whether the good or service is highly interdependent or highly interrelated to the other elements in the arrangement, and whether there are other vendors that can provide the items. Additionally, the Otsuka U.S. Agreement does not include a general right of return. The three performance obligations identified in connection with the Company’s obligations under the Otsuka U.S. Agreement are as follows: (i) License and Development Services Combined (License Performance Obligation) The License Deliverable is not distinct from the Development Services Deliverable, due to the limitations inherent in the license conveyed. More specifically, the license conveyed to Otsuka does not provide Otsuka with the right to manufacture vadadustat and products containing or comprising vadadustat. However, the manufacturing and supply services that are conducted as part of the services to be performed pursuant to the current global development plan are necessary for Otsuka to fully exploit the associated license for its intended purpose. The value of the rights provided through the license conveyed will be realized when the underlying products covered by the intellectual property progress through the development cycle, receive regulatory approval and are commercialized. Products containing or comprising vadadustat cannot be commercialized until the development services under the current global development plan are completed. Accordingly, Otsuka must obtain the manufacturing and supply of the associated products that are included within the development services to be performed pursuant to the current global development plan from the Company in order to derive benefit from the license, which significantly limits the ability for Otsuka to utilize the License Deliverable for its intended purpose in a way that generates economic benefits. (ii) Rights to Future Intellectual Property (Future IP Performance Obligation) The License and Development Services deliverables combined are distinct from the Future IP Deliverable because Otsuka can obtain the value of the license using the clinical trial materials implicit in the development services without the receipt of any other intellectual property that may be discovered or developed in the future. The Future IP Deliverable is distinct from the Committee Deliverable because the joint committee services have no bearing on the value to be derived from the rights to potential future intellectual property. As a result, the Future IP Deliverable qualifies as a separate performance obligation. (iii) Joint Committee Services (Committee Performance Obligation) The License and Development Services deliverables combined are distinct from the Committee Deliverable because Otsuka can obtain the value of the license using the clinical trial materials implicit in the development services without the joint committee services. The Committee Deliverable also is distinct from the rights to Future IP Deliverable because the joint committee services have no bearing on the value to be derived from the rights to potential future intellectual property. As a result, the Committee Deliverable qualifies as a separate performance obligation. The Company allocates the transaction price to each performance obligation based on the Company’s best estimate of the relative standalone selling price. The Company developed a best estimate of standalone selling price for the Committee Performance Obligation after considering the nature of the services to be performed and estimates of the associated effort and rates applicable to such services that would be expected to be realized under similar contracts. The Company developed a best estimate of standalone selling price for the Future IP Performance Obligation primarily based on the likelihood that additional intellectual property covered by the license conveyed will be developed during the term of the arrangement. The Company did not develop a best estimate of standalone selling price for the License Performance Obligation due to the following: (i) the best estimates of standalone selling price associated with the Future IP Performance Obligation was determined to be immaterial and (ii) the period of performance and pattern of recognition for the License Performance Obligation and the Committee Performance Obligation was determined to be similar. The Company has concluded that a change in the key assumptions used to determine the best estimate of standalone selling price for each performance obligation would not have a significant impact on the allocation of arrangement consideration. The transaction price at inception was comprised of: (i) the up-front payment, (ii) the cost share payment with respect to amounts incurred by the Company through December 31, 2016, and (iii) an estimate of the cost share payments to be received with respect to amounts incurred by the Company subsequent to December 31, 2016. No development or regulatory milestones were included in the transaction price at inception, as all milestone amounts were fully constrained. As part of its evaluation of the constraint, the Company considered numerous factors, including that receipt of the milestones is outside the control of the Company and contingent upon success in future clinical trials and the licensee’s efforts. Any consideration related to sales-based milestones will be recognized when the related sales occur as they were determined to relate predominantly to the license granted to Otsuka and therefore have also been excluded from the transaction price. The Company re-evaluates the transaction price in each reporting period and as uncertain events are resolved or other changes in circumstances occur. The Company determined that under ASC 606, the contract was modified in the second quarter of 2019 when the Otsuka Funding Option became effective and the Company became eligible to receive the Additional Funding amount. In connection with the modification, the Company adjusted the transaction price to include the Additional Funding amount as additional variable consideration. The Company constrains the variable consideration to an amount for which a significant revenue reversal is not probable. In the event that there is consideration received by a customer in the form of activities performed by such customer under the global development plan, such consideration is reflected as a reduction to the transaction price as contra revenue rather than as an expense because the associated services are not distinct from the License Performance Obligation. No amounts were allocated to the Future IP Performance Obligation because the associated best estimate of standalone selling price was determined to be immaterial. Due to the similar performance period and recognition pattern between the License Performance Obligation and the Committee Performance Obligation, the transaction price has been allocated to the License Performance Obligation and the Committee Performance Obligation on a combined basis. Accordingly, the Company will recognize revenue related to the allocable arrangement consideration on a proportional performance basis as the underlying development services are performed pursuant to the current global development plan which is commensurate with the period and consistent with the pattern over which the Company’s obligations are satisfied for both the License Performance Obligation and the Committee Performance Obligation. Effectively, the Company has treated the arrangement as if the License Performance Obligation and the Committee Performance Obligation are a single performance obligation. As of March 31, 2020, the transaction price totaling $438.7 million is comprised of: (i) the up-front payment of $125.0 million, (ii) the cost share payment with respect to amounts incurred by the Company through December 31, 2016 of $33.8 million, and (iii) the estimate of the net cost share consideration to be received of approximately $279.9 million with respect to amounts incurred by the Company subsequent to December 31, 2016 and the Additional Funding. As of March 31, 2020, no development or regulatory milestones have been assessed as probable of being reached and thus have been fully constrained. During the three months ended March 31, 2020 and 2019, the Company recognized revenue totaling approximately $38.6 million and $26.2 million, respectively, with respect to the Otsuka U.S. Agreement. The revenue is classified as collaboration revenue in the accompanying unaudited condensed consolidated statements of operations. As of March 31, 2020, there is approximately $45.9 million of deferred revenue related to the Otsuka U.S. Agreement of which $19.1 million is classified as current and $ 26.8 The Company determined that the medical affairs, commercialization and non-promotional activities elements of the Otsuka U.S. Agreement represent joint operating activities in which both parties are active participants and of which both parties are exposed to significant risks and rewards that are dependent on the success of the activities. Accordingly, the Company is accounting for the joint medical affairs, commercialization and non-promotional activities in accordance with ASC No. 808, Collaborative Arrangements Revenue from Contracts with Customers – Scope and Scope Exceptions reimbursable by Otsuka and recorded as a reduction to research and development expense during each of the three months ended March 31, 2020 and 2019 , respectively . During each of the three months ended March 31, 2020 and 2019 , Otsuka incurred approximately $ million of costs related to the cost-sharing provisions of the Otsuka U.S. Agreement, of which approximately $ million are reimbursable by the Company and recorded as an increase to research and development expense during each of the three months ended March 31, 2020 and 2019 . International Collaboration and License Agreement with Otsuka Pharmaceutical Co. Ltd. Summary of Agreement On April 25, 2017, the Company entered into a collaboration and license agreement with Otsuka, or the Otsuka International Agreement. The collaboration is focused on the development and commercialization of vadadustat in Europe, Russia, China, Canada, Australia, the Middle East and certain other territories, collectively, the Otsuka International Territory. Under the terms of the Otsuka International Agreement, the Company is responsible for leading the development of vadadustat, including the ongoing global Phase 3 development program. Otsuka has the sole responsibility, at its own cost, for the commercialization of vadadustat in the Otsuka International Territory, subject to the approval by the relevant regulatory authorities. Under the terms of the Otsuka International Agreement, the Company granted to Otsuka an exclusive, sublicensable license under certain intellectual property controlled by the Company to develop and commercialize vadadustat and products containing or comprising vadadustat in the Otsuka In |
Business Combination
Business Combination | 3 Months Ended |
Mar. 31, 2020 | |
Business Combinations [Abstract] | |
Business Combination | 5. Business Combination On December 12, 2018, the Company completed the Merger with Keryx. Keryx’s proprietary product, Auryxia, is approved by the FDA for two indications: (1) the control of serum phosphorus levels in adult patients with DD-CKD and (2) the treatment of iron deficiency anemia in adult patients with NDD-CKD. Pursuant to the terms and conditions of the Merger Agreement, e ach outstanding Keryx Share, excluding the Baupost Additional Shares, as defined below, and each outstanding Keryx equity award were converted into Akebia Shares and substantially similar Akebia equity awards, respectively, at an exchange ratio of 0.37433 for a t Fair value of 57,773,090 Akebia Shares $ 516,492 Fair value of 602,752 Akebia RSUs 304 Fair value of 3,967,290 Akebia stock options 10,958 Total consideration $ 527,754 I mmediately prior to the Merger, Baupost Group Securities, L.L.C., or Baupost, agreed to convert its $164.7 million of Keryx’s Convertible Notes into 35,582,335 Keryx Shares, in accordance with the terms of the governing indenture agreement, in exchange for an additional 4,000,000 Keryx Shares, or the Baupost Additional Shares. The aggregate 39.6 million Keryx Shares were then converted into Akebia Shares at the 0.37433 exchange ratio. The fair value of the Baupost Additional Shares, on an as-converted basis, of $13.4 million has been excluded from the purchase price and recorded within selling, general and administrative expenses in the Company’s consolidated financial statements Business Combinations . The Company allocated the $527.8 million purchase price to the identifiable assets acquired and liabilities assumed in the business combination at their fair values as of December 12, 2018 as follows Cash and cash equivalents $ 5,257 Inventory 235,597 Trade accounts receivable, net 15,834 Prepaid expenses and other current assets 8,399 Goodwill 55,053 Intangible assets: Developed product rights for Auryxia 329,130 Other intangible assets 545 Property and equipment, net 3,646 Other assets 14,441 Accounts payable (17,570 ) Accrued expenses (42,972 ) Deferred tax liability (35,096 ) Debt (15,000 ) Fair value of unfavorable executory contract (29,510 ) Total purchase price $ 527,754 In performing the purchase price allocation, the Company considered, among other factors, the intended future use of acquired assets, analysis of historical financial performance and estimates of future performance of Keryx’s business. As part of the purchase price allocation, the Company identified developed product rights for Auryxia as the primary intangible asset. The fair value of the developed product rights for Auryxia was determined using the multi-period excess earnings method which is a variation of the income approach, and is a valuation technique that provides an estimate of the fair value of an asset based on the principle that the value of an intangible asset is equal to the present value of the incremental after-tax cash flows attributable to the asset, after taking charges for the use of other assets employed by the business. Key estimates and assumptions used in this model were projected revenues and expenses related to the asset, estimated contributory asset charges, and a risk-adjusted discount rate of 20.0% used to calculate the present value of the future expected cash inflows from the asset. The intangible asset is being amortized on a straight-line basis over its estimated useful life, which for Auryxia is nine years. The Company also identified an executory contract in the supply agreement between Keryx and BioVectra Inc., or BioVectra, which includes future firm purchase commitments. This executory contract was deemed to have an off-market element related to the amount of purchase commitments that exceed the current forecast and as such, the Company recorded a liability in purchase accounting. As of the acquisition date, the fair value of the off-market element was $29.5 million. The goodwill represents the excess of the purchase price over the estimated fair value of net assets acquired. The factors contributing to the recognition of goodwill were based on several strategic and synergistic benefits that were expected to be realized from the Merger. These benefits included the expectation that the combined company would establish itself as a leading renal company with enhanced position and large market opportunity, synergistic utilization of Keryx’s commercial organization, and strengthening the combined company’s financial profile. Such goodwill is not deductible for tax purposes. In connection with the Merger, the Company identified a deferred tax liability of $35.1 million as a result of the difference in the book basis and tax basis related to the identifiable inventory, other intangible assets, net and other liability. |
Available for Sale Securities
Available for Sale Securities | 3 Months Ended |
Mar. 31, 2020 | |
Investments Debt And Equity Securities [Abstract] | |
Available for Sale Securities | 6. Available For Sale Securities Cash, cash equivalents, and available for sale securities at March 31, 2020 and December 31, 2019 consisted of the following : Gross Gross Unrealized Unrealized Amortized Cost Gains Losses Fair Value (in thousands) March 31, 2020 Cash and cash equivalents $ 115,374 $ — $ — $ 115,374 Total cash, cash equivalents, and available for sale securities $ 115,374 $ — $ — $ 115,374 Gross Gross Unrealized Unrealized Amortized Cost Gains Losses Fair Value (in thousands) December 31, 2019 Cash and cash equivalents $ 147,449 $ — $ — $ 147,449 Available for sale securities: Certificates of deposit $ 245 — — $ 245 Total available for sale securities $ 245 $ — $ — $ 245 Total cash, cash equivalents, and available for sale securities $ 147,694 $ — $ — $ 147,694 The Company did not hold any available for sale securities at March 31, 2020. There were no realized gains or losses on available for sale securities for the three months ended March 31, 2019. Additionally, the Company did not have any available for sale securities that were in an unrealized loss position as of December 31, 2019. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | 7. Fair Value of Financial Instruments The Company utilizes a portfolio management company for the valuation of the majority of its investments. This company is an independent, third-party vendor recognized to be an industry leader with access to market information that obtains or computes fair market values from quoted market prices, pricing for similar securities, recently executed transactions, cash flow models with yield curves and other pricing models. For valuations obtained from the pricing service, the Company performs due diligence to understand how the valuation was calculated or derived, focusing on the valuation technique used and the nature of the inputs. Based on the fair value hierarchy, the Company classifies its cash equivalents and available for sale securities within Level 1 or Level 2. This is because the Company values its cash equivalents and available for sale securities using quoted market prices or alternative pricing sources and models utilizing market observable inputs. Assets measured or disclosed at fair value on a recurring basis as of March 31, 2020 and December 31, 2019 are summarized below: Fair Value Measurements Using Level 1 Level 2 Level 3 Total (in thousands) March 31, 2020 Assets: Cash and cash equivalents $ 115,374 $ — $ — $ 115,374 $ 115,374 $ — $ — $ 115,374 Liabilities: Derivative liability $ — $ — $ 1,740 $ 1,740 $ — $ — $ 1,740 $ 1,740 Fair Value Measurements Using Level 1 Level 2 Level 3 Total (in thousands) December 31, 2019 Assets: Cash and cash equivalents $ 147,449 $ — $ — $ 147,449 Certificates of deposit — 245 — 245 $ 147,449 $ 245 $ — $ 147,694 Liabilities: Derivative liability $ — $ — $ 1,650 $ 1,650 $ — $ — $ 1,650 $ 1,650 The Company’s Loan Agreement with Pharmakon (see Note 11) contains certain provisions that change the underlying cash flows of the debt instrument, including a potential extension to the interest-only period dependent on both no event of default having occurred and continuing and on the Company achieving certain regulatory and revenue conditions. The Company also assessed the acceleration of the obligations under the Loan Agreement under an event of default. In addition, under certain circumstances, a default interest rate will apply on all outstanding obligations during the occurrence and continuance of an event of default. In accordance with ASC 815, the Company concluded that these features are not clearly and closely related to the host instrument, and represent a single compound derivative that is required to be re-measured at fair value on a quarterly basis. The events of default include maintaining, on an annual basis, a minimum liquidity threshold starting in 2021, and on a quarterly basis, a minimum net sales threshold for Auryxia starting in the fourth quarter of 2020. The Company recorded a derivative liability related to the Company’s Loan Agreement with Pharmakon of $1.7 million The following table provides a roll-forward of the fair value of the derivative liability (in thousands): Balance at December 31, 2019 $ 1,650 Change in fair value of derivative liability, recorded as other expense 90 Balance at March 31, 2020 $ 1,740 The Company had no other assets or liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) at March 31, 2020 and December 31, 2019. Investment securities are exposed to various risks such as interest rate, market and credit risks. W hen the Company holds investment securities , d ue to the level of risk associated with certain investment securities and the level of uncertainty related to changes in the value of investment securities , the Company considers if changes in risks in the near term would result in material changes in the fair value of investments. |
Inventory
Inventory | 3 Months Ended |
Mar. 31, 2020 | |
Inventory Disclosure [Abstract] | |
Inventory | 8. Inventory The components of inventory, inclusive of step-up as a result of bringing Keryx’s inventory onto Akebia’s books at fair value in connection with the Merger, are summarized as follows: March 31, 2020 December 31, 2019 (in thousands) Raw materials $ 1,841 $ 2,278 Work in process 135,474 137,858 Finished goods 36,925 42,096 Total inventory $ 174,240 $ 182,232 Long-term inventory, which primarily consists of raw materials and work in process, is included in other assets in the Company’s unaudited condensed consolidated balance sheets. March 31, 2020 December 31, 2019 (in thousands) Balance Sheet Classification: Inventory $ 111,854 $ 116,349 Other assets 62,386 65,883 Total inventory $ 174,240 $ 182,232 Inventory amounts written down as a result of excess, obsolescence, scrap or other reasons and charged to cost of goods sold totaled $0.1 million and $1.7 million during the three months ended March 31, 2020 and 2019, respectively. If future sales of Auryxia are lower than expected, the Company may be required to write-down the value of such inventories. Inventory write-downs and losses on purchase commitments are recorded as a component of cost of sales in the unaudited condensed consolidated statement of operations. |
Intangible Assets and Goodwill
Intangible Assets and Goodwill | 3 Months Ended |
Mar. 31, 2020 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Intangible Assets and Goodwill | 9. Intangible Assets and Goodwill Intangible Assets The following table presents the Company’s intangible assets at March 31, 2020 and December 31, 2019 (in thousands): March 31, 2020 Gross Carrying Value Accumulated Amortization ASC 842 Adjustment Total Estimated useful life Acquired intangible assets: Developed product rights for Auryxia $ 329,130 $ (47,018 ) $ — $ 282,112 9 Years Favorable lease 545 (5 ) (540 ) — N/A Total $ 329,675 $ (47,023 ) $ (540 ) $ 282,112 December 31, 2019 Gross Carrying Value Accumulated Amortization ASC 842 Adjustment Total Estimated useful life Acquired intangible assets: Developed product rights for Auryxia $ 329,130 $ (37,918 ) $ — $ 291,212 9 Years Favorable lease 545 (5 ) (540 ) — N/A Total $ 329,675 $ (37,923 ) $ (540 ) $ 291,212 On December 12, 2018, the Company completed the Merger, whereby it acquired certain definite-lived intangible assets, including the developed product rights for Auryxia and a favorable lease. The Company amortizes its definite-lived intangible assets acquired as part of the Merger using the straight-line method, which is considered the best estimate of economic benefit, over its estimated useful life. As a result of the adoption of ASC 842 on January 1, 2019, the Company reclassed the remaining balance of the favorable lease intangible asset into the operating lease asset. The Company recorded $9.1 million in amortization expense related to the developed product rights for Auryxia during each of the three months ended March 31, 2020 and 2019. Estimated future amortization expense for the intangible asset as of March 31, 2020 is as follows (in thousands): Total 2020 $ 27,302 2021 36,401 2022 36,402 2023 36,401 2024 36,402 Thereafter 109,204 $ 282,112 Goodwill Goodwill was $55.1 million as of March 31, 2020 and December 31, 2019, derived as follows (in thousands): Total Merger consideration $ 527,754 Less: Fair value of identified acquired assets and liabilities, net (472,701 ) Goodwill $ 55,053 Goodwill is evaluated for impairment on an annual basis as of October 1, and more frequently if indicators are present or changes in circumstances suggest that an impairment may exist. |
Accrued Expenses
Accrued Expenses | 3 Months Ended |
Mar. 31, 2020 | |
Payables And Accruals [Abstract] | |
Accrued Expenses | 10. Accrued Expenses Accrued expenses as of March 31, 2020 and December 31, 2019 are as follows: March 31, 2020 December 31, 2019 (in thousands) Accrued clinical $ 54,581 $ 61,815 Product revenue allowances 31,225 30,552 Accrued payroll 7,727 12,604 MTPC - Supply of Validation Drug Product 6,441 — Lease liability 5,096 4,989 Professional fees 3,949 3,444 Accrued commercial manufacturing 2,694 2,680 Royalties 2,459 2,713 Accrued severance 452 725 Accrued other 10,263 9,549 Total accrued expenses $ 124,887 $ 129,071 |
Debt
Debt | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Debt | 11. Debt Future principal payments on the Term Loans (as defined below) as of March 31, 2020 are as follows (in thousands): Principal Payments (in thousands) 2020 $ — 2021 — 2022 7,140 2023 30,354 2024 42,506 Thereafter — Total before unamortized discount and issuance costs 80,000 Less: unamortized discount and issuance costs (3,928 ) Total term loans $ 76,072 Term Loans On November 11, 2019, the Company, with Keryx as guarantor, entered into a loan agreement, or the Loan Agreement, with BioPharma Credit PLC as collateral agent and a lender, or the Collateral Agent, and BioPharma Credit Investments V (Master) LP as a lender, collectively with the Collateral Agent, Pharmakon, pursuant to which term loans in an aggregate principal amount of $100.0 million are made available to the Company in two tranches, subject to certain terms and conditions, or the Term Loans. The first tranche of $80.0 million, or Tranche A, was drawn on November 25, 2019, or the Tranche A Funding Date. The second tranche, available until December 31, 2020, allows the Company to borrow, at its option, an additional $20.0 million, or Tranche B, subject to the satisfaction of customary conditions. The date on which Tranche B is drawn, the Tranche B Funding Date, and each of the Tranche A Funding Date and the Tranche B Funding Date, a Funding Date. Proceeds from the Term Loans may be used for general corporate purposes. The Company and Keryx entered into a Guaranty and Security Agreement with the Collateral Agent, or the Guaranty and Security Agreement, on the Tranche A Funding Date. Pursuant to the Guaranty and Security Agreement, the Company’s obligations under the Term Loans are unconditionally guaranteed by Keryx, or the Guarantee. Additionally, the obligations of the Company and Keryx under the Term Loans and the Guarantee are secured by a first priority lien on certain assets of the Company and Keryx, including Auryxia and certain related assets, cash, and certain equity interests held by the Company and Keryx, collectively the Collateral. The Term Loans bear interest at a floating rate per annum equal to the three-month LIBOR rate plus 7.50%, subject to a 2.00% LIBOR floor and a 3.35% LIBOR cap, payable quarterly in arrears. The Term Loans will mature on the fifth anniversary of the Tranche A Funding Date, or the Maturity Date. The Company will repay the principal under the Term Loans in equal quarterly payments starting on the 33rd-month anniversary of the applicable Funding Date or, if certain conditions are met, it will have the option to repay the principal in equal quarterly payments starting on the 48th-month anniversary of the applicable Funding Date, or collectively the Amortization Schedule. Under certain circumstances, unless certain liquidity conditions are met, the Maturity Date may decrease by up to one year, and the Amortization Schedule may correspondingly commence up to one year earlier. On the Tranche A Funding Date, the Company paid to Pharmakon a facility fee equal to 2.00% of the aggregate principal amount of the Term Loans, or $2.0 million, in addition to other expenses incurred by Pharmakon and reimbursed by the Company, or Lender Expenses. The Tranche A draw was $77.3 million, net of facility fee, Lender Expenses and issuance costs. The Loan Agreement permits voluntary prepayment at any time in whole or in part, subject to a prepayment premium. The prepayment premium would be 2.00% of the principal amount being prepaid prior to the third anniversary of the applicable Funding Date, 1.00% on or after the third anniversary, but prior to the fourth anniversary, of the applicable Funding Date, and 0.50% on or after the fourth anniversary of the applicable Funding Date but prior to the Maturity Date, and a make-whole premium on or prior to the second anniversary of the applicable Funding Date in an amount equal to foregone interest through the second anniversary of the applicable Funding Date. A change of control triggers a mandatory prepayment of the Term Loans. The Loan Agreement contains customary representations, warranties , events of default and covenants of the Company and its subsidiaries, including maintaining, on an annual basis, a minimum liquidity threshold starting in 2021, and on a quarterly basis, a minimum net sales threshold for Auryxia starting in the fourth quarter of 2020 . If an event of default occurs and is continuing under the Loan Agreement, the Collateral Agent is entitled to take enforcement action, including acceleration of amounts due under the Loan Agreement. Under certain circumstances, a default interest rate will apply on all outstanding obligations during the occurrence and continuance of an event of default. As of March 31, 20 20 and December 31, 2019 , the Company determined that no events of default had occurred. The Company assessed the terms and features of the Loan Agreement in order to identify any potential embedded features that would require bifurcation or any beneficial conversion feature. As part of this analysis, the Company assessed the economic characteristics and risks of the Loan Agreement, including put and call features. The terms and features assessed include a potential extension to the interest-only period dependent on both no event of default having occurred and continuing and on the Company achieving certain regulatory and revenue conditions. The Company also assessed the acceleration of the obligations under the Loan Agreement under an event of default. In addition, under certain circumstances, a default interest rate will apply on all outstanding obligations during the occurrence and continuance of an event of default. In accordance with ASC 815, the Company concluded that these features are not clearly and closely related to the host instrument, and represent a single compound derivative that is required to be re-measured at fair value on a quarterly basis. The events of default include maintaining, on an annual basis, a minimum liquidity threshold starting in 2021, and on a quarterly basis, a minimum net sales threshold for Auryxia starting in the fourth quarter of 2020. The fair value of the derivative liability related to the Company’s Loan Agreement with Pharmakon is $1.7 million as of both March 31, 2020 and December 31, 2019, respectively. The Company classified the derivative liability as a non-current liability on the unaudited condensed consolidated balance sheet as of March 31, 2020. During the three months ended March 31, 2020, the Company recognized approximately $2.2 million of interest expense related to the Loan Agreement. |
Warrant
Warrant | 3 Months Ended |
Mar. 31, 2020 | |
Warrant Disclosure [Abstract] | |
Warrant | 12. Warrant In connection with the Janssen Agreement, in February 2017 the Company issued a warrant to purchase 509,611 shares of the Company’s common stock at an exercise price of $9.81 per share. The warrant was fully vested upon issuance and is exercisable in whole or in part, at any time prior to February 9, 2022. The warrant satisfied the equity classification criteria of ASC 815, and is therefore classified as an equity instrument. The fair value at issuance of $3.4 million was calculated using the Black Scholes option pricing model and was charged to research and development expense as it represented consideration for a license for which the underlying intellectual property was deemed to have no alternative future use. As of March 31, 2020, the warrant remains outstanding and expires on February 9, 2022. |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Stockholders' Equity | 13. Stockholders’ Equity Authorized and Outstanding Capital Stock As of March 31, 2020, the authorized capital stock of the Company included 175,000,000 shares of common stock, par value $0.00001 per share, of which 130,251,440 and 121,674,568 shares were issued and outstanding at March 31, 2020 and December 31, 2019, respectively; and 25,000,000 shares of undesignated preferred stock, par value $0.00001 per share, of which no shares were issued and outstanding at March 31, 2020 and December 31, 2019. At-the-Market Facility On November 12, 2019, the Company entered into an Amended and Restated Controlled Equity Offering SM Equity Plans On February 28, 2014, the Company’s Board of Directors adopted its 2014 Incentive Plan and its 2014 Employee Stock Purchase Plan, or the 2014 ESPP, which were subsequently approved by its shareholders and became effective upon the closing of the Company’s initial public offering on March 25, 2014. The Company’s 2014 Incentive Plan was subsequently amended on December 11, 2018, which amendment did not require shareholder approval. The Company’s 2014 Incentive Plan, as amended, is referred to as the 2014 Plan. The 2014 Plan replaced the Company’s Amended and Restated 2008 Equity Incentive Plan, or the 2008 Plan; however, options or other awards granted under the 2008 Plan prior to the adoption of the 2014 Plan that have not been settled or forfeited remain outstanding and effective. On June 6, 2019, the Company’s shareholders approved the Amended and Restated 2014 Employee Stock Purchase Plan, or the ESPP. In May 2016, the Company’s Board of Directors approved an inducement award program that was separate from the Company’s equity plans and which, consistent with Nasdaq Listing Rule 5635(c)(4), did not require shareholder approval, or the Inducement Award Program. During the three months ended March 31, 2020, the Company granted 299,450 options to purchase shares of the Company’s common stock to new hires under the Inducement Award Program, of which all 299,450 options to purchase Akebia Shares remained outstanding at March 31, 2020. The 2014 Plan allows for the granting of stock options, stock appreciation rights, or SARs, restricted stock, unrestricted stock, RSUs, performance awards and other awards convertible into or otherwise based on shares of the Company’s common stock. Dividend equivalents may also be provided in connection with an award under the 2014 Plan. The Company’s employees, officers, directors and consultants and advisors are eligible to receive awards under the 2014 Plan. The Company initially reserved 1,785,000 shares of its common stock for the issuance of awards under the 2014 Plan. The 2014 Plan provides that the number of shares reserved and available for issuance under the 2014 Plan will automatically increase annually on January 1 of each calendar year, by an amount equal to three percent (3%) of the number of Akebia Shares outstanding on a fully diluted basis as of the close of business on the immediately preceding December 31, or the 2014 Plan Evergreen Provision. The Company’s Board of Directors may act prior to January 1 of any year to provide that there will be no automatic increase in the number of Akebia Shares available for grant under the 2014 Plan for that year (or that the increase will be less than the amount that would otherwise have automatically been made). On December 12, 2018, in connection with the consummation of the Merger, the Company assumed outstanding and unexercised options to purchase Keryx Shares, as adjusted by the Exchange Multiplier pursuant to the terms of the Merger Agreement, under the following Keryx equity plans, or the Keryx Equity Plans: the Keryx 1999 Share Option Plan, the Keryx 2004 Long-Term Incentive Plan, the Keryx 2007 Incentive Plan, the Keryx Amended and Restated 2013 Incentive Plan, and the Keryx 2018 Equity Incentive Plan, or the Keryx 2018 Plan. In addition, the number of Keryx Shares available for issuance under the Keryx 2018 Plan, as adjusted by the Exchange Multiplier pursuant to the terms of the Merger Agreement, may be used for awards granted by the Company under its 2014 Plan, or the Assumed Shares, provided that the Company uses the Assumed Shares for individuals who were not employees or directors of the Company prior to the consummation of the Merger. During the three months ended March 31, 2020, the Company granted 1,714,800 The ESPP provides for the issuance of options to purchase shares of the Company’s common stock to participating employees at a discount to their fair market value. As noted above, the Company’s stockholders approved the ESPP, which amended and restated the Company’s 2014 ESPP, on June 6, 2019. The maximum aggregate number of shares at March 31, 2020 of the Company’s common stock available for future issuance under the ESPP is 5,600,968. Under the ESPP, each offering period is six months, at the end of which employees may purchase shares of the Company’s common stock through payroll deductions made over the term of the offering. The per-share purchase price at the end of each offering period is equal to the lesser of eighty-five percent (85%) of the closing price of the Company’s common stock at the beginning or end of the offering period. Shares Reserved for Future Issuance The Company has reserved for future issuance the following number of shares of common stock: March 31, 2020 December 31, 2019 Common stock options and RSUs outstanding (1) 16,107,645 12,195,031 Shares available for issuance under Akebia equity plans (2) 2,740,708 2,983,256 Warrant to purchase common stock 509,611 509,611 Shares available for issuance under the ESPP (3) 5,600,968 5,715,992 Total 24,958,932 21,403,890 (1) (2) On January 1, 20 20 , January 1, 201 9 and January 1, 201 8 , the shares reserved for future grants under the 2014 Plan increased by 4,031,376 , 3,801,198 and 1,575,329 shares, respectively, pursuant to the 2014 Plan Evergreen Provision. On December 12, 2018, the shares reserved for future grants under the 2014 Plan increased by 2,323,213 shares as a result of the Company’s addition of the Assumed Shares to the 2014 Plan. O n January 30, 2019, the Company’s Board of Directors approved 3,150,000 shares for issuance as option awards in fiscal year 2019 under the Inducement Award Program. (3) On June 6, 2019, the shares reserved for future issuance under the ESPP increased by 5,200,000 shares upon shareholder approval of the Amended and Restated 2014 Employee Stock Purchase Plan. On February 28, 2018 and February 28, 2017, the shares reserved for future issuance under the 2014 ESPP remained unchanged. There were no increases in the shares reserved for future issuance pursuant to the evergreen provision under the ESPP in 2017 and 2018 as the maximum aggregate number of shares available for purchase under the 2014 ESPP had reached its cap of 739,611 on February 28, 2016. Stock-Based Compensation Stock Options Service-Based Stock Options On February 28, 2020, as part of the Company’s annual grant of equity, the Company issued 1,714,800 stock options to employees. In addition, the Company issues stock options to directors, new hires and occasionally to other employees not in connection with the annual grant process. Options granted by the Company vest over periods of between 12 and 48 months, subject, in each case, to the individual’s continued service through the applicable vesting date. Options vest either 100% on the first anniversary of the grant date or in installments of (i) 25% at the one year anniversary and (ii) 12 equal quarterly installments beginning after the one year anniversary of the grant date, subject to the individual’s continuous service with the Company. Options generally expire ten years after the date of grant. The Company recorded approximately $1.6 million and $1.1 million of stock-based compensation expense related to stock options during the three months ended March 31, 2020 and 2019. Performance-Based Stock Options On December 12, 2018, pursuant to the Merger Agreement, each outstanding and unexercised performance-based option to acquire Keryx Shares granted under a Keryx equity plan converted into a service-based option or performance-based option to acquire Akebia Shares, with the number of shares and exercise price adjusted by the Exchange Multiplier. As a result, the Company issued 233,954 performance-based options related to the Merger. The Company did not have any performance-based options outstanding in fiscal year 2018 prior to the Merger. The Company did not issue any performance-based options during the three months ended March 31, 2020 and 2019. As of March 31, 2020, the Company had no performance-based options outstanding compared to 46,790 performance-based options outstanding at December 31, 2019. The potential range of shares issuable pursuant to the Company’s performance-based options range from 0% to 100% of the target shares based on financial measures. Performance-based options vest up to 50% upon achievement of performance condition and up to 50% one year following achievement of the performance condition. Restricted Stock Units Service-Based Restricted Stock Units On February 28, 2020, as part of the Company’s annual grant of equity, the Company issued 2,268,000 restricted stock units, or RSUs, to employees. In addition, the Company occasionally issues RSUs not in connection with the annual grant process to employees. Generally, Performance -Based Restricted Stock Units On February 28, 2020, as part of the Company’s annual grant of equity, the Company issued 479,000 performance-based restricted stock units, or PSUs, to the Company’s executives. The PSUs granted by the Company vest in connection with the achievement of specified commercial and regulatory milestones. The PSUs also feature a time-based vesting component. The expense recognized for these awards is based on the grant date fair value of the Company’s common stock multiplied by the number of units granted and recognized over time based on the probability of meeting such commercial and regulatory milestones. The Company recorded approximately $0.1 million and $0 of stock-based compensation expense related to employee PSUs during the three months ended March 31, 2020 and 2019, respectively. Employee Stock Purchase Plan The first offering period under the ESPP opened on January 2, 2015. The Company issued 115,024 shares during the three months ended March 31, 2020. The Company recorded approximately $0.2 million and $48,000 of stock-based compensation expense related to the ESPP during the three months ended March 31, 2020 and 2019, respectively. Compensation Expense Summary The Company has classified its stock-based compensation expense related to share-based awards as follows: Three Months Ended March 31, 2020 March 31, 2019 (in thousands) Research and development $ 1,542 $ 878 Selling, general and administrative 3,374 1,216 Total $ 4,916 $ 2,094 Compensation expense by type of award: Three Months Ended March 31, 2020 March 31, 2019 (in thousands) Stock options $ 1,617 $ 1,112 Restricted stock units 3,142 934 Employee stock purchase plan 157 48 Total $ 4,916 $ 2,094 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2020 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 14. Commitments and Contingencies Leases The Company leases approximately 65,167 square feet of office and lab space in Cambridge, Massachusetts under a lease which was most recently amended in April 2018, collectively the Cambridge Lease. Under the Third Amendment to the Cambridge Lease, or the Third Amendment, executed in July 2016, total monthly lease payments under the initial base rent were approximately $242,000 and are subject to annual rent escalations. In addition to such annual rent escalations, base rent payments for a portion of said premises commenced on January 1, 2017 in the monthly amount of approximately $22,000. The Fourth Amendment to the Cambridge Lease, executed in May 2017, provided additional storage space to the Company and did not impact rent payments. In April 2018, the Company entered into a Fifth Amendment to the Cambridge Lease, or the Fifth Amendment, for an additional 19,805 square feet of office space on the 12 th February 2019 Additionally, as a result of the Merger, the Company now has a lease for 27,300 square feet of office space in Boston, Massachusetts, or the Boston Lease, which expires in February 2023. The total monthly lease payments under the base rent are approximately $136,000 and are subject to annual rent escalations. The term of the Cambridge Lease with respect to the office space expires on September 11, 2026, with one five-year five-year In September 2019, Keryx entered into an agreement to sublease the Boston office space to Foundation Medicine, Inc., or Foundation. The sublease is subject and subordinate to the Boston Lease between Keryx and the landlord. The Company has not entered into any material short-term leases or financing leases as of March 31, 2020. The total security deposit in connection with the Cambridge Lease is $1.6 million as of March 31, 2020. Additionally, the Company recorded $0.8 million for the security deposit under the Boston Lease. Both the Cambridge Lease and the Boston Lease have their security deposits in the form of a letter of credit, all of which are included in prepaid expenses and other current assets in the Company’s unaudited condensed consolidated balance sheets as of March 31, 2020. As of March 31, 2020, undiscounted minimum rental commitments under non-cancelable leases, for each of the next five years and total thereafter are as follows: Lease Payments Operating to be Received Net Operating Leases from Sublease Lease Payments (in thousands) Remaining 2020 $ 4,820 $ 1,328 $ 3,492 2021 7,064 1,797 $ 5,267 2022 6,735 1,824 $ 4,911 2023 5,347 307 $ 5,040 2024 5,116 — $ 5,116 Thereafter 8,818 — $ 8,818 Total $ 37,900 $ 5,256 $ 32,644 In arriving at the operating lease liabilities, the Company applied incremental borrowing rates ranging from 5.91% to 6.94%, which were based on the remaining lease term at the date of adoption of ASC 842, which was January 1, 2019. As of March 31, 2020, the remaining lease terms ranged from 1.67 years to 6.45 years. As of March 31, 2020, the following represents the difference between the remaining undiscounted minimum rental commitments under non-cancelable leases and the operating lease liabilities: Operating Leases (in thousands) Total Undiscounted minimum rental commitments $ 37,900 Present value adjustment using incremental borrowing rate (6,596 ) Operating lease liabilities $ 31,304 Manufacturing Agreements As part of the Merger, the Company retained Keryx’s commercial supply agreements with BioVectra and Siegfried Evionnaz SA, or Siegfried, to supply commercial drug substance for Auryxia. Pursuant to the Manufacture and Supply Agreement with BioVectra and the Product Manufacture and Supply and Facility Construction Agreement with BioVectra, collectively the BioVectra Agreement, the Company has agreed to purchase a minimum quantity of drug substance of Auryxia at predetermined prices. The price per kilogram will decrease with an increase in quantity above the minimum purchase quantity. In addition, the BioVectra Agreement contained contingent milestone payments for capital developments in connection with construction of an expansion of the site of the BioVectra production facility for the manufacture of drug substance for Auryxia. These milestone payments were achieved by BioVectra and fully recorded prior to the Merger. These milestone payments are recorded in other assets and amortized into drug substance as inventory is released to the Company. The term of the BioVectra Agreement expires in late 2026, after which, it automatically renews for specified terms until terminated. The Company may terminate the BioVectra Agreement prior to the expiration of the contract term, which could result in early termination fee. As of March 31, 2020, the Company is required to purchase a minimum quantity of drug substance for Auryxia annually at a total cost of approximately $135.3 million through the end of the contract term. As part of purchase accounting, the Company identified an executory contract in the BioVectra Agreement, which includes future firm purchase commitments. This executory contract was deemed to have an off-market element related to the amount of purchase commitments that exceed the current forecast. As a result, the Company recorded a liability of $29.5 million in purchase accounting, as of the acquisition date for the fair value of the off-market element. Through March 31, 2020 , the Company recorded $0.9 million in accretion expense related to the present value discount associated with this liability. Pursuant to the Siegfried Master Manufacturing Services and Supply Agreement, or the Siegfried Agreement, the Company has agreed to purchase a minimum quantity of drug substance of Auryxia at predetermined prices. The price per kilogram will decrease with an increase in quantity above the minimum purchase quantity. The term of the Siegfried Agreement expires on December 31, 2021, after which, it automatically renews for one-year On April 9, 2019, the Company entered into a Supply Agreement with Esteve Química, S.A., or Esteve, or the Esteve Agreement. The Esteve Agreement includes the terms and conditions under which Esteve will manufacture vadadustat drug substance, or API, for commercial use. Pursuant to the Esteve Agreement, the Company will provide rolling forecasts to Esteve on a quarterly basis, or the Forecast. The Forecast will reflect the Company’s needs for API produced by Esteve over a certain number of months, represented as a quantity of API per calendar quarter. The parties have agreed to a volume-based pricing structure under the Esteve Agreement. The Esteve Agreement has an initial term of four years, beginning April 9, 2019 and ending April 9, 2023. As of March 31, 2020, the Company had a minimum commitment with Esteve for $6.0 million through the first quarter of 2021. Subsequent to March 31, 2020, the minimum commitment with Esteve increased to $13.6 million through the second quarter of 2021. On March 11, 2020, the Company entered into a Supply Agreement with Patheon Inc., or Patheon, or the Patheon Agreement. The Patheon Agreement includes the terms and conditions under which Patheon will manufacture vadadustat drug product for commercial use. Additionally, on April 2, 2020, the Company entered into a Supply Agreement with STA Pharmaceutical Hong Kong Limited, a subsidiary of Wuxi AppTec, or WuXi STA, or the WuXi STA Agreement. The WuXi STA Agreement includes the terms and conditions under which WuXi STA will manufacture vadadustat API for commercial use. There are no minimum commitments under either supply agreement as of March 31, 2020. Other Third Party Contracts Under the Company’s agreement with IQVIA to provide contract research organization services for the PRO 2 2 Litigation and Related Matters From time to time, the Company may become subject to legal proceedings and claims which arise in the ordinary course of its business. Consistent with ASC 450, Contingencies |
Net Loss per Share
Net Loss per Share | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Net Loss per Share | 15. Net Loss per Share The shares in the table below were excluded from the calculation of diluted net loss per share, prior to the use of the treasury stock method, due to their anti-dilutive effect: As of March 31, 2020 2019 Warrant 509,611 509,611 Outstanding stock options 9,371,675 10,261,827 Unvested restricted stock units 6,735,970 2,058,687 Total 16,617,256 12,830,125 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the U.S., or GAAP, for interim financial reporting and as required by Regulation S-X, Rule 10-01. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. Any reference in these notes to applicable guidance is meant to refer to the authoritative U.S. GAAP as found in the Accounting Standards Codification, or ASC, and Accounting Standards Update, or ASU, of the Financial Accounting Standards Board, or FASB. In the opinion of management, all adjustments, consisting of normal recurring accruals and revisions of estimates, considered necessary for a fair presentation of the unaudited condensed consolidated financial statements have been included. Interim results for the three months ended March 31, 2020 are not necessarily indicative of the results that may be expected for the fiscal year ending December 31, 2020 or any other future period. The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Management has determined that the Company operates in one segment, which is the business of developing and commercializing novel therapeutics for people with kidney disease. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the Company’s consolidated financial statements and the accompanying notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 filed with the U.S. Securities and Exchange Commission on March 12, 2020, or the 2019 Annual Report on Form 10-K. The significant accounting policies used in preparation of these unaudited condensed consolidated financial statements for the three months ended March 3 1 , 20 20 are consistent with those discussed in Note 2 to the consolidated financial statements in the Company’s 201 9 Annual Report on Form 10-K and are updated below as necessary. |
New Accounting Pronouncements | New Accounting Pronouncements – Recently Adopted In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , which requires that financial assets measured at amortized cost be presented at the net amount expected to be collected. Previously, U.S. GAAP delayed recognition of the full amount of credit losses until the loss was probable of occurring. Under this ASU, the income statement will reflect an entity’s current estimate of all expected credit losses. The Company adopted this new standard on January 1, 2020 using the modified retrospective approach, which requires a cumulative-effect adjustment, if any, to the opening balance of retained earnings to be recognized on the date of adoption with prior periods not restated. The cumulative-effect adjustment recorded on January 1, 2020, is not material. Please see the description of the Company’s “Credit Losses” accounting policy in the “Significant Accounting Policies” section below. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement In August 2018, the FASB issued ASU 2018-15, Intangible-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract In November 2018, the FASB issued ASU 2018-18, Collaborative Arrangements (Topic 808): Clarifying the Interaction between Topic 808 and Topic 606 • Clarifies that certain transactions between collaborative arrangement participants should be accounted for as revenue under ASC 606, Revenue from Contracts with Customers , when the collaborative arrangement participant is a customer in the context of a unit of account. In those situations, all the guidance in ASC 606 should be applied, including recognition, measurement, presentation and disclosure requirements; • Adds unit-of-account guidance to ASC 808, Collaborative Arrangements , to align with the guidance in ASC 606 (that is, a distinct good or service) when an entity is assessing whether the collaborative arrangement or a part of the arrangement is within the scope of ASC 606; and • Precludes a company from presenting transactions with collaborative arrangement participants that are not directly related to sales to third parties with revenue recognized under ASC 606 if the collaborative arrangement participant is not a customer. This standard became effective for the Company on January 1, 2020, and did not have a material impact on the Company’s unaudited condensed consolidated financial statements and related disclosures. New Accounting Pronouncements – Not Yet Adopted In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. and related disclosures |
Derivative Financial Instruments | Derivative Financial Instruments The Company accounts for warrants and other derivative financial instruments as either equity or liabilities in accordance with ASC Topic 815, Derivatives and Hedging, or ASC 815, based upon the characteristics and provisions of each instrument. Warrants classified as equity are recorded at fair value as of the date of issuance on the Company’s consolidated balance sheets and no further adjustments to their valuation are made. Warrants classified as derivative liabilities and other derivative financial instruments that require separate accounting as liabilities are recorded on the Company’s consolidated balance sheets at their fair value on the date of issuance and will be revalued on each subsequent balance sheet date until such instruments are exercised or expire, with any changes in the fair value between reporting periods recorded as other income or expense. The warrant issued by the Company in connection with the Janssen Pharmaceutica NV Research and License Agreement, the Janssen Agreement, is classified as equity in the Company’s consolidated bal ance sheet. (See Note 12). The derivative liability recorded in connection with the Company’s Loan Agreement with Pharmakon is classified as a liability in the Company’s consolidated balance sheet. (See Note 11). |
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 reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results may differ from those estimates. Management considers many factors in selecting appropriate financial accounting policies and controls, and in developing the estimates and assumptions that are used in the preparation of these financial statements. Management must apply significant judgment in this process. In addition, other factors may affect estimates, including expected business and operational changes, sensitivity and volatility associated with the assumptions used in developing estimates, and whether historical trends are expected to be representative of future trends. The estimation process often may yield a range of potentially reasonable estimates of the ultimate future outcomes, and management must select an amount that falls within that range of reasonable estimates. Estimates are used in the following areas, among others: prepaid and accrued research and development expense, operating lease assets and liabilities, derivative liabilities, other non-current liabilities, stock-based compensation expense, product and collaboration revenues including various rebates and reserves related to product sales, inventories, income taxes, intangible assets and goodwill. The Company has made estimates of the impact of COVID-19 within the unaudited condensed consolidated financial statements and there may be changes to those estimates in future periods including changes to sales, payer mix, reserves and allowances, intangible assets and goodwill. While the COVID-19 pandemic has not had a material adverse impact on the Company’s financial condition, the future impacts of the pandemic and any resulting economic impact is largely unknown and rapidly evolving. |
Credit Losses | Credit Losses Available for sale debt securities. Management determines the appropriate classification of securities at the time of purchase and reevaluates such designation as of each balance sheet date. The Company classifies all securities as available for sale and includes them in current assets as they are intended to fund current operations. The Company's investment portfolio at any point in time contains investments in money market mutual funds, U.S. government debt securities, certificates of deposit and corporate debt securities. The Company segments its portfolio based on the underlying risk profiles of the securities and have a zero loss expectation for money market mutual funds, U.S. government debt securities and certificates of deposit. The Company regularly reviews the securities in an unrealized loss position and evaluates the current expected credit loss by considering factors such as historical experience, market data, issuer-specific factors, and current economic conditions. During the quarter ended March 31, 2020, the Company’s only available for sales securities consisted of certificates of deposit and therefore the Company did not recognize any credit losses. |
Cash, Cash Equivalents, and Restricted Cash | Cash, Cash Equivalents, and Restricted Cash Cash and cash equivalents consist of all cash on hand, deposits and funds invested in available for sale securities with original maturities of three months or less at the time of purchase. Cash equivalents are reported at fair value. At March 31, 2020, the Company’s cash is primarily in money market funds. The Company may maintain balances with its banks in excess of federally insured limits. Restricted cash represents amounts required for security deposits under the Company’s office and lab space lease agreements and, at March 31, 2019, cash balances held as collateral for the Company’s employee credit card program. Restricted cash is included in “prepaid expenses and other current assets” and “other assets” in the unaudited condensed consolidated balance sheets. The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported in the unaudited condensed consolidated balance sheet that sum to the total of the amounts reported in the unaudited condensed consolidated statement of cash flows (in thousands): March 31, 2020 March 31, 2019 Cash and cash equivalents $ 115,374 $ 62,741 Prepaid expenses and other current assets 395 263 Other assets 2,039 2,192 Total cash, cash equivalents, and restricted cash shown in the statement of cash flows $ 117,808 $ 65,196 |
Property and Equipment | Property and Equipment Property and equipment is stated at cost, less accumulated depreciation. Assets under capital lease are included in property and equipment. Property and equipment is depreciated using the straight-line method over the estimated useful lives of the assets, generally three to seven years. Such costs are periodically reviewed for recoverability when impairment indicators are present. Such indicators include, among other factors, operating losses, unused capacity, market value declines and technological obsolescence. Recorded values of asset groups of equipment that are not expected to be recovered through undiscounted future net cash flows are written down to current fair value, which generally is determined from estimated discounted future net cash flows (assets held for use) or net realizable value (assets held for sale). The following is the summary of property and equipment and related accumulated depreciation as of March 31, 2020 and December 31, 2019. Useful Life March 31, 2020 December 31, 2019 (in thousands) Computer equipment and software 3 $ 1,010 $ 1,010 Furniture and fixtures 5 - 7 2,086 2,086 Equipment 7 2,451 2,451 Leasehold improvements Shorter of the useful life or remaining lease term (10 years) 8,497 8,497 14,044 14,044 Less accumulated depreciation (4,189 ) (3,664 ) Net property and equipment $ 9,855 $ 10,380 Depreciation expense was approximately $0.5 million and $0.4 million for the three months ended March 31, 2020 and 2019, respectively. |
Inventories | Inventory The Company values its inventories at the lower-of-cost or net realizable value. The Company determines the cost of its inventories, which includes amounts related to materials and manufacturing overhead, on a first-in, first-out basis. The Company classifies its inventory costs as long-term, in other assets in its unaudited condensed consolidated balance sheets, when it expects to utilize the inventory beyond their normal operating cycle. Prior to the regulatory approval of its product candidates, the Company incurs expenses for the manufacture of material that could potentially be available to support the commercial launch of its products. Until the first reporting period when regulatory approval has been received or is otherwise considered probable and the future economic benefit is expected to be realized, the Company records all such costs as research and development expense. Inventory used in clinical trials is also expensed as research and development expense, when selected for such use. Inventory that can be used in either the production of clinical or commercial products is expensed as research and development costs when identified for use in a clinical manufacturing campaign. The Company performs an assessment of the recoverability of capitalized inventory during each reporting period, and writes down any excess and obsolete inventory to its net realizable value in the period in which the impairment is first identified. Such impairment charges, should they occur, are recorded as a component of cost of product sales in the unaudited condensed consolidated statements of operations and comprehensive loss. The determination of whether inventory costs will be realizable requires the use of estimates by management. If actual market conditions are less favorable than projected by management, additional write-downs of inventory may be required. Additionally, the Company’s product is subject to strict quality control and monitoring that it performs throughout the manufacturing process. In the event that certain batches or units of product no longer meet quality specifications, the Company will record a charge to cost of product sales to write-down any unmarketable inventory to its estimated net realizable value. In all cases, product inventory is carried at the lower of cost or its estimated net realizable value. |
Debt | Debt The Company performs an assessment of all embedded features of a debt instrument to determine if (1) such features should be bifurcated and separately accounted for, and (2) if bifurcation requirements are met, whether such features should be classified and accounted for as equity or liability instruments. If the embedded feature meets the requirements to be bifurcated and accounted for as a liability, the fair value of the embedded feature is measured initially, included as a liability on the unaudited condensed unaudited condensed |
Revenue Recognition | Revenue Recognition The Company generates revenues primarily from sales of Auryxia, see Note 3, and from its collaborations with MTPC and Otsuka, see Note 4. The Company recognizes revenue in accordance with ASC 606, which applies to all contracts with customers, except for contracts that are within the scope of other standards. Under ASC 606, the Company recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that the Company determines are within the scope of ASC 606, it performs the following five steps: (i) identify the contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies a performance obligation. The Company only applies the five-step model to contracts when it is probable that the entity will collect the consideration it is entitled to in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company assesses the goods or services promised within each contract and determines those that are performance obligations, and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. The Company does not include a financing component to its estimated transaction price at contract inception unless it estimates that certain performance obligations will not be satisfied within one year. Additionally, the Company recognizes the incremental costs of obtaining a contract as an expense when incurred if the amortization period of the asset that the Company otherwise would have recognized is one year or less. Product Revenue, Net The Company sells Auryxia in the United States, or U.S., primarily to wholesale distributors as well as certain specialty pharmacy providers, collectively, Customers. These Customers resell the Company’s product to health care providers and patients. In addition to distribution agreements with Customers, the Company enters into arrangements with health care providers and payors that provide for government-mandated and/or privately-negotiated rebates, chargebacks, and discounts with respect to the purchase of the Company’s product. The Company recognizes revenue on product sales when the Customer obtains control of the Company’s product, which occurs at a point in time, typically upon delivery to the Customer. The Company expenses incremental costs of obtaining a contract as and when incurred if the expected amortization period of the asset that it would have recognized is one year or less. Reserves for Variable Consideration Revenue from product sales is recorded at the net sales price (transaction price), which includes estimates of variable consideration for which reserves are established and which result from discounts, returns, chargebacks, rebates, co-pay assistance and other allowances that are offered within contracts between the Company and its Customers, health care providers, payors and other indirect customers relating to the Company’s sales of its products. These reserves are based on the amounts earned or to be claimed on the related sales and are classified as reductions of accounts receivable (if the amount will be credited to the Customer) or as a current liability (if the amount is payable to a Customer or a party other than a Customer). When appropriate, t hese estimates take into consideration a range of possible outcomes which are probability-weighted in accordance with the expected value method in ASC 606 for relevant factors such as the Company’s historical experience, current contractual and statutory requirements, specific known market events and trends, industry data, and forecasted customer buying and payment patterns. Overall, these reserves reflect the Company’s best estimates of the amount of consideration to which it is entitled based on the terms of the respective underlying contracts. The amount of variable consideration that is included in the transaction price may be constrained, and is included in the net sales price only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period. Actual amounts of consideration ultimately received may differ from the Company’s estimates. If actual results in the future vary from the Company’s estimates, the Company will adjust these estimates, which would affect net product revenue and earnings in the period such variances become known. Trade Discounts and Allowances: The Company generally provides Customers with discounts that include incentive fees that are explicitly stated in the Company’s contracts and are recorded as a reduction of revenue in the period the related product revenue is recognized. In addition, the Company compensates (through trade discounts and allowances) its Customers for sales order management, data, and distribution services. However, the Company has determined such services received to date are not distinct from the Company’s sale of products to the Customer and, therefore, these payments have been recorded as a reduction of revenue within the unaudited condensed consolidated statement of operations and comprehensive loss through March 31, 2020. The Company records a corresponding reduction of accounts receivable (if the trade discount and/or allowance will be credited to the Customer) or an increase in accrued expense (if the trade discount and/or allowance is payable to a Customer) on the unaudited condensed consolidated balance sheets. Product Returns: Consistent with industry practice, the Company generally offers Customers a limited right of return which allows for the product to be returned when the product expiry is within an allowable window. This right of return lapses once the product is provided to a patient. The Company estimates the amount of its product sales that may be returned by its Customers and records this estimate as a reduction of revenue in the period the related product revenue is recognized. The Company currently estimates product return reserve using available industry data and its own historical sales information, including its visibility into the inventory remaining in the distribution channel. Provider Chargebacks and Discounts : Chargebacks for fees and discounts to providers represent the estimated obligations resulting from contractual commitments to sell products to qualified healthcare providers at prices lower than the list prices charged to Customers who directly purchase the product from the Company. Customers charge the Company for the difference between what they pay for the product and the ultimate selling price to the qualified healthcare providers. These reserves are established in the same period that the related revenue is recognized, resulting in a reduction of product revenue and accounts receivable. Chargeback amounts are generally determined at the time of resale to the qualified healthcare provider by Customers, and the Company generally issues credits for such amounts within a few weeks of the Customer’s resale of the product. Reserves for chargebacks consist of credits that the Company expects to issue for units that remain in the distribution channel at each reporting period end that the Company expects will be sold to qualified healthcare providers, and chargebacks that Customers have claimed but for which the Company has not yet issued a credit. Commercial and Medicare Part D Rebates: The Company contracts with various commercial payor organizations, primarily health insurance companies and pharmacy benefit managers, for the payment of rebates with respect to utilization of its products. The Company estimates the rebates for commercial and Medicare Part D payors based upon (i) its contracts with the payors and (ii) information obtained from its Customers and other third parties regarding the payor mix for Auryxia. The Company estimates these rebates and records such estimates in the same period the related revenue is recognized, resulting in a reduction of product revenue and the establishment of a current liability. Other Government Rebates: The Company is subject to discount obligations under state Medicaid programs and other government programs. The Company estimates its Medicaid and other government programs rebates based upon a range of possible outcomes that are probability-weighted for the estimated payor mix. These reserves are recorded in the same period the related revenue is recognized, resulting in a reduction of product revenue and the establishment of a current liability which is included in accrued expenses and other current liabilities on the unaudited condensed consolidated balance sheets. For Medicare, the Company also estimates the number of patients in the prescription drug coverage gap for whom the Company will owe an additional liability under the Medicare Part D program. The Company’s liability for these rebates consists of invoices received for claims from prior quarters that have not been paid or for which an invoice has not yet been received, estimates of claims for the current quarter, and estimated future claims that will be made for product that has been recognized as revenue, but which remains in the distribution channel at the end of each reporting period. Other Incentives: Other incentives that the Company offers include voluntary patient assistance programs such as the Company’s co-pay assistance program, which are intended to provide financial assistance to qualified commercially insured patients with prescription drug co-payments required by payors. The calculation of the accrual for co-pay assistance is based on actual claims processed during a given period, as well as historical utilization data to estimate the amount the Company expects to receive associated with product that has been recognized as revenue, but remains in in the distribution channel at the end of each reporting period. Collaboration Revenues The Company enters into out-license and collaboration agreements which are within the scope of ASC 606, under which it licenses certain rights to its product candidates to third parties. The terms of these arrangements typically include payment to the Company of one or more of the following: non-refundable, up-front license fees; development, regulatory, and commercial milestone payments; payments for manufacturing supply services the Company provides through its contract manufacturers; and royalties on net sales of licensed products. Each of these payments may result in license, collaboration and other revenue, except for revenues from royalties on net sales of licensed products, which are classified as royalty revenues. In determining the appropriate amount of revenue to be recognized as the Company fulfills its obligations under each of its agreements, the Company implements the five-step model noted above. As part of the accounting for these arrangements, the Company must develop assumptions that require judgment to determine whether the individual promises should be accounted for as separate performance obligations or as a combined performance obligation, and to determine the stand-alone selling price for each performance obligation identified in the contract. A deliverable represents a separate performance obligation if both of the following criteria are met: (i) the customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer, and (ii) the entity’s promise to transfer the good or service to the customer is separately identifiable from other promises in the contract. The Company uses key assumptions to determine the stand-alone selling price, which may include forecasted revenues, development timelines, reimbursement rates for personnel costs, discount rates, and probabilities of technical and regulatory success. With regard to the MTPC and Otsuka collaboration agreements, the Company recognizes revenue related to amounts allocated to the identified performance obligation on a proportional performance basis as the underlying services are performed. Licenses of Intellectual Property If the license to the Company’s intellectual property is determined to be distinct from the other performance obligations identified in an out-license and collaboration arrangement, the Company recognizes revenue from non-refundable, up-front fees allocated to the license when the license is transferred to the customer and the customer is able to use and benefit from the license. For licenses that are bundled with other promises, the Company utilizes judgment to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue from non-refundable, up-front fees. The Company evaluates the measure of progress each reporting period and, if necessary, adjust the measure of performance and related revenue recognition. Milestone Payments At the inception of each arrangement that includes development milestone payments, the Company evaluates whether the milestones are considered probable of being reached and estimates the amount to be included in the transaction price using the most likely amount method. The Company evaluates factors such as the scientific, clinical, regulatory, commercial, and other risks that must be overcome to assess the milestone as probable of being achieved. There is considerable judgment involved in determining whether a milestone is probable of being reached at each specific reporting period. Milestone payments that are not within the control of the Company or the customer, such as regulatory approvals, are not considered probable of being achieved until those approvals are received. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price. The transaction price is then allocated to each performance obligation on a relative stand-alone selling price basis, for which the Company recognizes revenues as, or when, the performance obligations under the contract are satisfied. At the end of each subsequent reporting period, the Company re-evaluates the probability of achievement of such development milestones and any related constraint, and if necessary, adjusts its estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis, which would affect collaboration revenue in the period of adjustment. Manufacturing Supply Services Arrangements that include a promise for future supply of drug substance or drug product for either clinical development or commercial supply at the licensee’s discretion are generally considered as options. The Company assesses if these options provide a material right to the licensee and if so, they are accounted for as separate performance obligations. If the Company is entitled to additional payments when the licensee exercises these options, any additional payments are recorded in license, collaboration and other revenues when the licensee obtains control of the goods, which is upon delivery. Royalties The Company will recognize sales-based royalties, including milestone payments based on the level of sales, at the later of (i) when the related sales occur, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied). The Company receives royalty payments from JT and Torii, based on net sales of Riona in Japan. Collaborative Arrangements The Company records the elements of its collaboration agreements that represent joint operating activities in accordance with ASC Topic 808, Collaborative Arrangements Revenue from Contracts with Customers – Scope and Scope Exceptions During the three months ended March 31, 2020 and 2019, the Company incurred approximately $0.5 million and $0.3 million, respectively, of costs related to the cost-sharing provisions of the Otsuka U.S. Agreement, of which approximately $0.3 million and $0.2 million are reimbursable by Otsuka and recorded as a reduction to research and development expense during the three months ended March 31, 2020 and 2019, respectively. March 31, 2020 and 2019 March 31, 2020 and 2019 |
Intangible Assets | Intangible The Company maintains a definite-lived intangible asset related to developed product rights for Auryxia, which was acquired on December 12, 2018 as part of the Merger. Intangible assets are initially recorded at fair value and stated net of accumulated amortization and impairments. The Company amortizes its intangible assets that have finite lives using either the straight-line method, or if reliably determinable, based on the pattern in which the economic benefit of the asset is expected to be utilized. Amortization for the Company’s intangible asset is recorded over its estimated useful life of nine years. The Company reviews intangible assets subject to amortization to determine if any adverse conditions exist or a change in circumstances has occurred that would indicate impairment or a change in the remaining useful life. If an impairment indicator exists, the Company performs a recoverability test by comparing the sum of the estimated undiscounted cash flows of the intangible asset and asset group to its carrying value on the unaudited condensed consolidated balance sheet. If the carrying value of the intangible asset exceeds the undiscounted cash flows used in the recoverability test, the Company will write the carrying value down to the fair value in the period identified. The Company calculates the fair value of intangible assets as the present value of estimated future cash flows expected to be generated from the intangible asset using a risk-adjusted discount rate. In determining estimated future cash flows associated with its intangible assets, the Company uses market participant assumptions pursuant to ASC Topic 820, Fair Value Measurements and Disclosures |
Goodwill | Goodwill The Company allocates any excess purchase price over the fair value of the net tangible and intangible assets acquired in a business combination to goodwill. Goodwill is evaluated for impairment on an annual basis as of October 1, and more frequently if indicators are present or changes in circumstances suggest that impairment may exist . 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 its reporting unit, the Company would record an impairment loss equal to the difference. As described above, the Company operates in one operating segment which the Company considers to be the only reporting unit. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company is required to disclose information on all assets and liabilities reported at fair value that enables an assessment of the inputs used in determining the reported fair values. ASC 820 establishes a hierarchy of inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the inputs that market participants would use in pricing the asset or liability, and are developed based on the best information available in the circumstances. The fair value hierarchy applies only to the valuation inputs used in determining the reported fair value of the investments, and is not a measure of the investment credit quality. The three levels of the fair value hierarchy are described below: • Level 1 – Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. • Level 2 – Valuations based on quoted prices for similar assets or liabilities in markets that are not active, or for which all significant inputs are observable, either directly or indirectly. • Level 3 – Valuations that require inputs that reflect the Company’s own assumptions that are both significant to the fair value measurement and unobservable. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized in Level 3. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Items measured at fair value on a recurring basis include available for sale securities and derivative liabilities (see Note 7). The carrying amounts of prepaid expenses and other current assets, accounts payable and accrued expenses approximate their fair values due to their short-term maturities. Items measured at fair value on a nonrecurring basis include property and equipment, intangible assets and goodwill. The Company remeasures the fair value of these assets upon the occurrence of certain events. There were no such remeasurements to property and equipment for the three months ended March 31, 2020 and 2019, respectively. There were no impairments to assets measured using Level 3 inputs during the three months ended March 31, 2020 and 2019, respectively. The Company’s other financial instruments mainly consists of debt (see Note 11). |
Net Loss per Share | Net Loss per Share Basic net loss per share is calculated by dividing net loss by the weighted-average shares outstanding during the period, without consideration for common stock equivalents. Diluted net loss per share is calculated by adjusting weighted-average shares outstanding for the dilutive effect of common stock equivalents outstanding for the period, determined using the treasury-stock method. For purposes of the diluted net loss per share calculation, preferred stock, stock options, warrants, restricted stock and RSUs are considered to be common stock equivalents, but have been excluded from the calculation of diluted net loss per share, as their effect would be anti-dilutive for all periods presented. Therefore, basic and diluted net loss per share were the same for all periods presented. Diluted net income per share is calculated by dividing the net income by the weighted-average common shares outstanding for the period, including any dilutive effect from outstanding options, warrants, restricted stock and RSUs using the treasury stock method. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Reconciliation of Cash, Cash Equivalents, and Restricted Cash | The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported in the unaudited condensed consolidated balance sheet that sum to the total of the amounts reported in the unaudited condensed consolidated statement of cash flows (in thousands): March 31, 2020 March 31, 2019 Cash and cash equivalents $ 115,374 $ 62,741 Prepaid expenses and other current assets 395 263 Other assets 2,039 2,192 Total cash, cash equivalents, and restricted cash shown in the statement of cash flows $ 117,808 $ 65,196 |
Summary of Property and Equipment and Related Accumulated Depreciation | The following is the summary of property and equipment and related accumulated depreciation as of March 31, 2020 and December 31, 2019. Useful Life March 31, 2020 December 31, 2019 (in thousands) Computer equipment and software 3 $ 1,010 $ 1,010 Furniture and fixtures 5 - 7 2,086 2,086 Equipment 7 2,451 2,451 Leasehold improvements Shorter of the useful life or remaining lease term (10 years) 8,497 8,497 14,044 14,044 Less accumulated depreciation (4,189 ) (3,664 ) Net property and equipment $ 9,855 $ 10,380 |
Product Revenue and Reserves _2
Product Revenue and Reserves for Variable Consideration (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Revenue From Contract With Customer [Abstract] | |
Summary of Product Revenue Allowance and Reserve Categories | The following table summarizes activity in each of the product revenue allowance and reserve categories for the three months ended March 31, 2020 and 2019 (in thousands): Chargebacks and Discounts Rebates, Fees and other Deductions Returns Total Balance at December 31, 2019 $ 738 $ 30,552 $ 253 $ 31,543 Current provisions related to sales in current year 2,250 30,519 1,053 33,822 Adjustments related to prior year sales 82 32 — 114 Credits/payments made (2,353 ) (29,024 ) (1,051 ) (32,428 ) Balance at March 31, 2020 $ 717 $ 32,079 $ 255 $ 33,051 Balance at December 31, 2018 $ 516 $ 22,861 $ 360 $ 23,737 Current provisions related to sales in current year 1,486 17,476 870 19,832 Adjustments related to prior year sales — 156 — 156 Credits/payments made (1,495 ) (17,301 ) (947 ) (19,743 ) Balance at March 31, 2019 $ 507 $ 23,192 $ 283 $ 23,982 |
License, Collaboration and Ot_2
License, Collaboration and Other Significant Agreements (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Revenues Recognized From License, Collaboration and Other Significant Agreements | During the three months ended March 31, 2020 and 2019, the Company recognized the following revenues from its license, collaboration and other significant agreements and had the following deferred revenue balances as of March 31, 2020: Three Months Ended March 31, 2020 2019 License, Collaboration and Other Revenue: (in thousands) Otsuka U.S. Agreement $ 38,577 $ 26,223 Otsuka International Agreement 19,370 21,956 Total Proportional Performance Revenue $ 57,947 $ 48,179 JT and Torii 1,126 1,228 MTPC Other Revenue 196 148 Total License, Collaboration and Other Revenue $ 59,269 $ 49,555 |
Deferred Revenues Balance | During the three months ended March 31, 2020 and 2019, the Company recognized the following revenues from its license, collaboration and other significant agreements and had the following deferred revenue balances as of March 31, 2020: March 31, 2020 Short-Term Long-Term Total Deferred Revenue: (in thousands) Otsuka U.S. Agreement $ 19,090 $ 26,854 $ 45,944 Otsuka International Agreement 11,807 11,266 23,073 MTPC - Supply of Validation Drug Product 3,989 — 3,989 Vifor Agreement — 4,679 4,679 Total $ 34,886 $ 42,799 $ 77,685 |
Schedule of Changes in Contract Assets and Liabilities | The following table presents changes in the Company’s contract assets and liabilities during the three months ended March 31, 2020 and 2019 (in thousands): Three Months Ended March 31, 2020 Balance at Beginning of Period Additions Deductions Balance at End of Period Contract assets: Accounts receivable (1) $ 15,822 $ 71,639 $ (2,895 ) $ 84,566 Prepaid expenses and other current assets $ — $ 546 $ — $ 546 Contract liabilities: Deferred revenue $ 72,950 $ 65,209 $ (60,474 ) $ 77,685 Accrued expenses and other current liabilities $ — $ 615 $ — $ 615 Three Months Ended March 31, 2019 Contract assets: Accounts receivable (1) $ 1,587 $ 30,387 $ (2,041 ) $ 29,933 Contract liabilities: Deferred revenue $ 112,689 $ 41,962 $ (48,180 ) $ 106,471 Accounts payable $ 13,492 $ — $ (13,492 ) $ — (1) |
Schedule of Revenue Recognized Resulting from Changes in Contract Asset and Contract Liability | During the three months ended March 31, 2020 and 2019, the Company recognized the following revenues as a result of changes in the contract asset and contract liability balances in the respective periods (in thousands): Three Months Ended March 31, Revenue Recognized in the Period from: 2020 2019 Amounts included in deferred revenue at the beginning of the period $ 10,130 $ 45,179 Performance obligations satisfied in previous periods $ — $ 1,254 |
Business Combination (Tables)
Business Combination (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Business Combinations [Abstract] | |
Summary of Total Fair Value Consideration | Pursuant to the terms and conditions of the Merger Agreement, e ach outstanding Keryx Share, excluding the Baupost Additional Shares, as defined below, and each outstanding Keryx equity award were converted into Akebia Shares and substantially similar Akebia equity awards, respectively, at an exchange ratio of 0.37433 for a t Fair value of 57,773,090 Akebia Shares $ 516,492 Fair value of 602,752 Akebia RSUs 304 Fair value of 3,967,290 Akebia stock options 10,958 Total consideration $ 527,754 |
Summary of Purchase Price of Identifiable Assets Acquired and Liabilities Assumed | The Company allocated the $527.8 million purchase price to the identifiable assets acquired and liabilities assumed in the business combination at their fair values as of December 12, 2018 as follows Cash and cash equivalents $ 5,257 Inventory 235,597 Trade accounts receivable, net 15,834 Prepaid expenses and other current assets 8,399 Goodwill 55,053 Intangible assets: Developed product rights for Auryxia 329,130 Other intangible assets 545 Property and equipment, net 3,646 Other assets 14,441 Accounts payable (17,570 ) Accrued expenses (42,972 ) Deferred tax liability (35,096 ) Debt (15,000 ) Fair value of unfavorable executory contract (29,510 ) Total purchase price $ 527,754 |
Available for Sale Securities (
Available for Sale Securities (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Investments Debt And Equity Securities [Abstract] | |
Summary of Cash Cash Equivalents and Available for Sale Securities at Fair Value | Cash, cash equivalents, and available for sale securities at March 31, 2020 and December 31, 2019 consisted of the following : Gross Gross Unrealized Unrealized Amortized Cost Gains Losses Fair Value (in thousands) March 31, 2020 Cash and cash equivalents $ 115,374 $ — $ — $ 115,374 Total cash, cash equivalents, and available for sale securities $ 115,374 $ — $ — $ 115,374 Gross Gross Unrealized Unrealized Amortized Cost Gains Losses Fair Value (in thousands) December 31, 2019 Cash and cash equivalents $ 147,449 $ — $ — $ 147,449 Available for sale securities: Certificates of deposit $ 245 — — $ 245 Total available for sale securities $ 245 $ — $ — $ 245 Total cash, cash equivalents, and available for sale securities $ 147,694 $ — $ — $ 147,694 |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Assets Measured or Disclosed at Fair Value on Recurring Basis | Assets measured or disclosed at fair value on a recurring basis as of March 31, 2020 and December 31, 2019 are summarized below: Fair Value Measurements Using Level 1 Level 2 Level 3 Total (in thousands) March 31, 2020 Assets: Cash and cash equivalents $ 115,374 $ — $ — $ 115,374 $ 115,374 $ — $ — $ 115,374 Liabilities: Derivative liability $ — $ — $ 1,740 $ 1,740 $ — $ — $ 1,740 $ 1,740 Fair Value Measurements Using Level 1 Level 2 Level 3 Total (in thousands) December 31, 2019 Assets: Cash and cash equivalents $ 147,449 $ — $ — $ 147,449 Certificates of deposit — 245 — 245 $ 147,449 $ 245 $ — $ 147,694 Liabilities: Derivative liability $ — $ — $ 1,650 $ 1,650 $ — $ — $ 1,650 $ 1,650 |
Schedule of Fair Value Derivative Liability | The following table provides a roll-forward of the fair value of the derivative liability (in thousands): Balance at December 31, 2019 $ 1,650 Change in fair value of derivative liability, recorded as other expense 90 Balance at March 31, 2020 $ 1,740 |
Inventory (Tables)
Inventory (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Inventory Disclosure [Abstract] | |
Components of Inventory | The components of inventory, inclusive of step-up as a result of bringing Keryx’s inventory onto Akebia’s books at fair value in connection with the Merger, are summarized as follows: March 31, 2020 December 31, 2019 (in thousands) Raw materials $ 1,841 $ 2,278 Work in process 135,474 137,858 Finished goods 36,925 42,096 Total inventory $ 174,240 $ 182,232 Long-term inventory, which primarily consists of raw materials and work in process, is included in other assets in the Company’s unaudited condensed consolidated balance sheets. March 31, 2020 December 31, 2019 (in thousands) Balance Sheet Classification: Inventory $ 111,854 $ 116,349 Other assets 62,386 65,883 Total inventory $ 174,240 $ 182,232 |
Intangible Assets and Goodwill
Intangible Assets and Goodwill (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Summary of Intangible Assets | The following table presents the Company’s intangible assets at March 31, 2020 and December 31, 2019 (in thousands): March 31, 2020 Gross Carrying Value Accumulated Amortization ASC 842 Adjustment Total Estimated useful life Acquired intangible assets: Developed product rights for Auryxia $ 329,130 $ (47,018 ) $ — $ 282,112 9 Years Favorable lease 545 (5 ) (540 ) — N/A Total $ 329,675 $ (47,023 ) $ (540 ) $ 282,112 December 31, 2019 Gross Carrying Value Accumulated Amortization ASC 842 Adjustment Total Estimated useful life Acquired intangible assets: Developed product rights for Auryxia $ 329,130 $ (37,918 ) $ — $ 291,212 9 Years Favorable lease 545 (5 ) (540 ) — N/A Total $ 329,675 $ (37,923 ) $ (540 ) $ 291,212 |
Schedule of Estimated Future Amortization Expense for Intangible Assets | Estimated future amortization expense for the intangible asset as of March 31, 2020 is as follows (in thousands): Total 2020 $ 27,302 2021 36,401 2022 36,402 2023 36,401 2024 36,402 Thereafter 109,204 $ 282,112 |
Schedule of Goodwill | Goodwill was $55.1 million as of March 31, 2020 and December 31, 2019, derived as follows (in thousands): Total Merger consideration $ 527,754 Less: Fair value of identified acquired assets and liabilities, net (472,701 ) Goodwill $ 55,053 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Payables And Accruals [Abstract] | |
Components of Accrued Expenses | Accrued expenses as of March 31, 2020 and December 31, 2019 are as follows: March 31, 2020 December 31, 2019 (in thousands) Accrued clinical $ 54,581 $ 61,815 Product revenue allowances 31,225 30,552 Accrued payroll 7,727 12,604 MTPC - Supply of Validation Drug Product 6,441 — Lease liability 5,096 4,989 Professional fees 3,949 3,444 Accrued commercial manufacturing 2,694 2,680 Royalties 2,459 2,713 Accrued severance 452 725 Accrued other 10,263 9,549 Total accrued expenses $ 124,887 $ 129,071 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Future Principal Payments on the Term Loans | Future principal payments on the Term Loans (as defined below) as of March 31, 2020 are as follows (in thousands): Principal Payments (in thousands) 2020 $ — 2021 — 2022 7,140 2023 30,354 2024 42,506 Thereafter — Total before unamortized discount and issuance costs 80,000 Less: unamortized discount and issuance costs (3,928 ) Total term loans $ 76,072 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Summary of Reserved Shares of Common Stock for Future Issuance | The Company has reserved for future issuance the following number of shares of common stock: March 31, 2020 December 31, 2019 Common stock options and RSUs outstanding (1) 16,107,645 12,195,031 Shares available for issuance under Akebia equity plans (2) 2,740,708 2,983,256 Warrant to purchase common stock 509,611 509,611 Shares available for issuance under the ESPP (3) 5,600,968 5,715,992 Total 24,958,932 21,403,890 (1) (2) On January 1, 20 20 , January 1, 201 9 and January 1, 201 8 , the shares reserved for future grants under the 2014 Plan increased by 4,031,376 , 3,801,198 and 1,575,329 shares, respectively, pursuant to the 2014 Plan Evergreen Provision. On December 12, 2018, the shares reserved for future grants under the 2014 Plan increased by 2,323,213 shares as a result of the Company’s addition of the Assumed Shares to the 2014 Plan. O n January 30, 2019, the Company’s Board of Directors approved 3,150,000 shares for issuance as option awards in fiscal year 2019 under the Inducement Award Program. (3) On June 6, 2019, the shares reserved for future issuance under the ESPP increased by 5,200,000 shares upon shareholder approval of the Amended and Restated 2014 Employee Stock Purchase Plan. On February 28, 2018 and February 28, 2017, the shares reserved for future issuance under the 2014 ESPP remained unchanged. There were no increases in the shares reserved for future issuance pursuant to the evergreen provision under the ESPP in 2017 and 2018 as the maximum aggregate number of shares available for purchase under the 2014 ESPP had reached its cap of 739,611 on February 28, 2016. |
Stock-Based Compensation Expense Related to Share-Based Awards | The Company has classified its stock-based compensation expense related to share-based awards as follows: Three Months Ended March 31, 2020 March 31, 2019 (in thousands) Research and development $ 1,542 $ 878 Selling, general and administrative 3,374 1,216 Total $ 4,916 $ 2,094 |
Schedule of Compensation Expense by Type of Award | Compensation expense by type of award: Three Months Ended March 31, 2020 March 31, 2019 (in thousands) Stock options $ 1,617 $ 1,112 Restricted stock units 3,142 934 Employee stock purchase plan 157 48 Total $ 4,916 $ 2,094 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Commitments And Contingencies Disclosure [Abstract] | |
Schedule of Undiscounted Minimum Rental Commitments Under Non-cancelable Leases | As of March 31, 2020, undiscounted minimum rental commitments under non-cancelable leases, for each of the next five years and total thereafter are as follows: Lease Payments Operating to be Received Net Operating Leases from Sublease Lease Payments (in thousands) Remaining 2020 $ 4,820 $ 1,328 $ 3,492 2021 7,064 1,797 $ 5,267 2022 6,735 1,824 $ 4,911 2023 5,347 307 $ 5,040 2024 5,116 — $ 5,116 Thereafter 8,818 — $ 8,818 Total $ 37,900 $ 5,256 $ 32,644 |
Schedule of Difference Between Undiscounted Minimum Rental Commitments Under Non-cancelable Leases and Operating Leases Liabilities | As of March 31, 2020, the following represents the difference between the remaining undiscounted minimum rental commitments under non-cancelable leases and the operating lease liabilities: Operating Leases (in thousands) Total Undiscounted minimum rental commitments $ 37,900 Present value adjustment using incremental borrowing rate (6,596 ) Operating lease liabilities $ 31,304 |
Net Loss per Share (Tables)
Net Loss per Share (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Anti-Dilutive Securities Excluded from Calculation of Diluted Net Loss per Share | The shares in the table below were excluded from the calculation of diluted net loss per share, prior to the use of the treasury stock method, due to their anti-dilutive effect: As of March 31, 2020 2019 Warrant 509,611 509,611 Outstanding stock options 9,371,675 10,261,827 Unvested restricted stock units 6,735,970 2,058,687 Total 16,617,256 12,830,125 |
Nature of Organization and Op_2
Nature of Organization and Operations - Additional Information (Details) | 3 Months Ended |
Mar. 31, 2020 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Number of months for operating plan sufficiently funded by cash resources | 12 months |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Additional Information (Details) | 3 Months Ended | |
Mar. 31, 2020USD ($)Segment | Mar. 31, 2019USD ($) | |
Summary Of Significant Accounting Policies [Line Items] | ||
Number of operating segments | Segment | 1 | |
Available for sale debt securities credit losses | $ 0 | |
Depreciation expense | $ 500,000 | $ 400,000 |
Intangible assets, estimated useful life | 9 years | |
Remeasurements to property and equipment | $ 0 | |
Fair Value, Inputs, Level 3 | ||
Summary Of Significant Accounting Policies [Line Items] | ||
Assets impairments charges | 0 | 0 |
Otsuka U.S. Agreement | ||
Summary Of Significant Accounting Policies [Line Items] | ||
Cost share costs for license agreement | 500,000 | 300,000 |
Reimbursable by Otsuka | 300,000 | 200,000 |
Cost share costs by partner for license agreement | 400,000 | 400,000 |
Reimbursable to Otsuka | $ 200,000 | $ 200,000 |
Minimum | ||
Summary Of Significant Accounting Policies [Line Items] | ||
Property, plant and equipment, Useful life | 3 years | |
Maximum | ||
Summary Of Significant Accounting Policies [Line Items] | ||
Property, plant and equipment, Useful life | 7 years |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Reconciliation of Cash, Cash Equivalents, and Restricted Cash (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2019 | Dec. 31, 2018 |
Summary Of Significant Accounting Policies [Line Items] | ||||
Cash and cash equivalents | $ 115,374 | $ 147,449 | $ 62,741 | |
Total cash, cash equivalents, and restricted cash shown in the statement of cash flows | 117,808 | $ 149,804 | 65,196 | $ 107,099 |
Prepaid Expenses and Other Current Assets | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Restricted cash, current | 395 | 263 | ||
Other Assets | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Restricted cash, noncurrent | $ 2,039 | $ 2,192 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Summary of Property and Equipment and Related Accumulated Depreciation (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Property, Plant and Equipment [Line Items] | ||
Gross property, plant and equipment | $ 14,044 | $ 14,044 |
Less accumulated depreciation | (4,189) | (3,664) |
Net property and equipment | $ 9,855 | 10,380 |
Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Useful life | 3 years | |
Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Useful life | 7 years | |
Computer equipment and software | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Useful life | 3 years | |
Gross property, plant and equipment | $ 1,010 | 1,010 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Gross property, plant and equipment | $ 2,086 | 2,086 |
Furniture and fixtures | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Useful life | 5 years | |
Furniture and fixtures | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Useful life | 7 years | |
Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Useful life | 7 years | |
Gross property, plant and equipment | $ 2,451 | 2,451 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Leasehold improvements, Useful Life | Shorter of the useful life or remaining lease term (10 years) | |
Gross property, plant and equipment | $ 8,497 | $ 8,497 |
Leasehold improvements | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, Useful life | 10 years |
Product Revenue and Reserves _3
Product Revenue and Reserves for Variable Consideration - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Disaggregation Of Revenue [Line Items] | ||
Total revenues | $ 88,478 | $ 72,666 |
Product Revenue, Net | ||
Disaggregation Of Revenue [Line Items] | ||
Total revenues | 29,209 | 23,111 |
Accounts receivable, net | $ 20,200 | $ 23,000 |
Product Revenue and Reserves _4
Product Revenue and Reserves for Variable Consideration - Summary of Product Revenue Allowance and Reserve Categories (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Valuation And Qualifying Accounts Disclosure [Line Items] | ||
Beginning Balance | $ 31,543 | $ 23,737 |
Current provisions related to sales in current year | 33,822 | 19,832 |
Adjustments related to prior year sales | 114 | 156 |
Credits/payments made | (32,428) | (19,743) |
Ending Balance | 33,051 | 23,982 |
Chargebacks and Discounts | ||
Valuation And Qualifying Accounts Disclosure [Line Items] | ||
Beginning Balance | 738 | 516 |
Current provisions related to sales in current year | 2,250 | 1,486 |
Adjustments related to prior year sales | 82 | |
Credits/payments made | (2,353) | (1,495) |
Ending Balance | 717 | 507 |
Rebates, Fees and other Deductions | ||
Valuation And Qualifying Accounts Disclosure [Line Items] | ||
Beginning Balance | 30,552 | 22,861 |
Current provisions related to sales in current year | 30,519 | 17,476 |
Adjustments related to prior year sales | 32 | 156 |
Credits/payments made | (29,024) | (17,301) |
Ending Balance | 32,079 | 23,192 |
Returns | ||
Valuation And Qualifying Accounts Disclosure [Line Items] | ||
Beginning Balance | 253 | 360 |
Current provisions related to sales in current year | 1,053 | 870 |
Credits/payments made | (1,051) | (947) |
Ending Balance | $ 255 | $ 283 |
License, Collaboration and Ot_3
License, Collaboration and Other Significant Agreements - Revenues Recognized From License, Collaboration and Other Significant Agreements (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
License, Collaboration and Other Revenue: | ||
License, Collaboration and Other Revenue | $ 88,478 | $ 72,666 |
License, Collaboration and Other Revenue | ||
License, Collaboration and Other Revenue: | ||
License, Collaboration and Other Revenue | 59,269 | 49,555 |
License, Collaboration and Other Revenue | Otsuka Pharmaceutical Company. Ltd. | Development and Commercialize United States Collaboration and License Agreement | ||
License, Collaboration and Other Revenue: | ||
License, Collaboration and Other Revenue | 38,577 | 26,223 |
License, Collaboration and Other Revenue | Otsuka Pharmaceutical Company. Ltd. | Development and Commercialize International Collaboration and License Agreement | ||
License, Collaboration and Other Revenue: | ||
License, Collaboration and Other Revenue | 19,370 | 21,956 |
License, Collaboration and Other Revenue | Mitsubishi Tanabe Pharma Corporation and Otsuka Pharmaceutical Company Limited | ||
License, Collaboration and Other Revenue: | ||
License, Collaboration and Other Revenue | 57,947 | 48,179 |
License, Collaboration and Other Revenue | Japan Tobacco Incorporation and Torii Pharmaceutical Company Limited | ||
License, Collaboration and Other Revenue: | ||
License, Collaboration and Other Revenue | 1,126 | 1,228 |
License, Collaboration and Other Revenue | Mitsubishi Tanabe Pharma Corporation | ||
License, Collaboration and Other Revenue: | ||
License, Collaboration and Other Revenue | 0 | 0 |
License, Collaboration and Other Revenue | Other Revenue | Mitsubishi Tanabe Pharma Corporation | ||
License, Collaboration and Other Revenue: | ||
License, Collaboration and Other Revenue | $ 196 | $ 148 |
License, Collaboration and Ot_4
License, Collaboration and Other Significant Agreements - Deferred Revenues Balance (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Deferred Revenue: | ||
Short-Term | $ 34,886 | $ 39,830 |
Long-Term | 42,799 | $ 33,120 |
Total | 77,685 | |
Otsuka Pharmaceutical Company. Ltd. | U.S. | ||
Deferred Revenue: | ||
Short-Term | 19,090 | |
Long-Term | 26,854 | |
Total | 45,944 | |
Otsuka Pharmaceutical Company. Ltd. | International | ||
Deferred Revenue: | ||
Short-Term | 11,807 | |
Long-Term | 11,266 | |
Total | 23,073 | |
MTPC | Supply of Validation Drug Product | ||
Deferred Revenue: | ||
Short-Term | 3,989 | |
Total | 3,989 | |
Vifor Pharma | ||
Deferred Revenue: | ||
Long-Term | 4,679 | |
Total | $ 4,679 |
License, Collaboration and Ot_5
License, Collaboration and Other Significant Agreements - Schedule of Changes in Contract Assets and Liabilities (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | ||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||
Contract liabilities, Balance at End of Period | $ 77,685 | ||
Accounts Receivable | |||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||
Contract assets, Balance at Beginning of Period | [1] | 15,822 | $ 1,587 |
Contract assets, Additions | [1] | 71,639 | 30,387 |
Contract assets, Deductions | [1] | (2,895) | (2,041) |
Contract assets, Balance at End of Period | [1] | 84,566 | 29,933 |
Prepaid Expenses and Other Current Assets | |||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||
Contract assets, Additions | 546 | ||
Contract assets, Balance at End of Period | 546 | ||
Accrued Expenses and Other Current Liabilities | |||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||
Contract liabilities, Additions | 615 | ||
Contract liabilities, Balance at End of Period | 615 | ||
Deferred Revenue | |||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||
Contract liabilities, Balance at Beginning of Period | 72,950 | 112,689 | |
Contract liabilities, Additions | 65,209 | 41,962 | |
Contract liabilities, Deductions | (60,474) | (48,180) | |
Contract liabilities, Balance at End of Period | $ 77,685 | 106,471 | |
Accounts Payable | |||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||
Contract liabilities, Balance at Beginning of Period | 13,492 | ||
Contract liabilities, Deductions | $ (13,492) | ||
[1] | Excludes accounts receivable from other services related to clinical and regulatory activities performed by the Company on behalf of MTPC that are not included in the performance obligations identified under the MTPC Agreement as of March 31, 2019 and 2020 and December 31, 2018 and 2019. Also excludes accounts receivable related to amounts due to the Company from product sales which are included in the accompanying unaudited condensed consolidated balance sheet as of March 31, 2020 and December 31, 2019. |
License, Collaboration and Ot_6
License, Collaboration and Other Significant Agreements - Schedule of Revenue Recognized Resulting from Changes in Contract Asset and Contract Liability (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | ||
Amounts included in deferred revenue at the beginning of the period | $ 10,130 | $ 45,179 |
Performance obligations satisfied in previous periods | $ 1,254 |
License, Collaboration and Ot_7
License, Collaboration and Other Significant Agreements - Additional Information (Details) | Feb. 14, 2020USD ($) | Apr. 08, 2019USD ($) | May 12, 2017USD ($)$ / sharesshares | Apr. 25, 2017USD ($) | Feb. 09, 2017USD ($)$ / sharesshares | Jul. 31, 2019USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Jun. 30, 2020USD ($) | Mar. 31, 2020USD ($)Obligationshares | Sep. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2019USD ($)shares | Dec. 31, 2018USD ($) | Sep. 30, 2017USD ($) | |
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Recognized revenue under license agreement | $ 88,478,000 | $ 72,666,000 | |||||||||||||||
Deferred revenue | 77,685,000 | ||||||||||||||||
Revenue on short-term or current liabilities | 34,886,000 | $ 39,830,000 | |||||||||||||||
Deferred revenue, noncurrent | $ 42,799,000 | $ 33,120,000 | |||||||||||||||
Common stock shares sold | shares | 130,251,440 | 121,674,568 | |||||||||||||||
License, Collaboration and Other Revenue | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Recognized revenue under license agreement | $ 59,269,000 | 49,555,000 | |||||||||||||||
Accounts Receivable | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Accounts receivable | [1] | 84,566,000 | 29,933,000 | $ 15,822,000 | $ 1,587,000 | ||||||||||||
Prepaid Expenses and Other Current Assets | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Accounts receivable | 546,000 | ||||||||||||||||
Accrued Expenses and Other Current Liabilities | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Deferred revenue | 615,000 | ||||||||||||||||
Mitsubishi Tanabe Pharma Corporation | License, Collaboration and Other Revenue | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Recognized revenue under license agreement | $ 0 | 0 | |||||||||||||||
Mitsubishi Tanabe Pharma Corporation | Development and Commercialize Collaboration Agreement | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Milestone revenue | $ 10,000,000 | ||||||||||||||||
Collaboration Agreement, expiration period | 10 years | ||||||||||||||||
Collaboration Agreement, notice period for termination | 12 months | ||||||||||||||||
Upfront cash payment received | $ 20,000,000 | ||||||||||||||||
Percentage of royalty payments on sales | 20.00% | ||||||||||||||||
Additional milestone or royalty payments received | $ 0 | ||||||||||||||||
Number of performance obligations | Obligation | 2 | ||||||||||||||||
Mitsubishi Tanabe Pharma Corporation | Development and Commercialize Collaboration Agreement | Maximum | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Milestone revenue | $ 175,000,000 | ||||||||||||||||
Mitsubishi Tanabe Pharma Corporation | New Agreement | Maximum | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Data access fee receivable | $ 25,000,000 | ||||||||||||||||
Mitsubishi Tanabe Pharma Corporation | Development And Commercialize Research And License Agreement | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Upfront cash payment received | 20,000,000 | ||||||||||||||||
Cost of research services | 20,500,000 | ||||||||||||||||
Deferred revenue | 0 | ||||||||||||||||
Accounts receivable | 0 | ||||||||||||||||
Mitsubishi Tanabe Pharma Corporation | Mitsubishi Tanabe Pharma Corporation and Otsuka Pharmaceutical Company Limited | Scenario Forecast | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Upfront cash payment received | $ 10,400,000 | ||||||||||||||||
Mitsubishi Tanabe Pharma Corporation | Mitsubishi Tanabe Pharma Corporation and Otsuka Pharmaceutical Company Limited | Accounts Receivable | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Accounts receivable | 10,400,000 | ||||||||||||||||
Mitsubishi Tanabe Pharma Corporation | Mitsubishi Tanabe Pharma Corporation and Otsuka Pharmaceutical Company Limited | Short-term Deferred Revenue | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Revenue on short-term or current liabilities | 4,000,000 | ||||||||||||||||
Mitsubishi Tanabe Pharma Corporation | Mitsubishi Tanabe Pharma Corporation and Otsuka Pharmaceutical Company Limited | Other Current Liabilities | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Revenue on short-term or current liabilities | 6,400,000 | ||||||||||||||||
Mitsubishi Tanabe Pharma Corporation | Regulatory Milestone Payments | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Milestone revenue | $ 10,000,000 | ||||||||||||||||
Mitsubishi Tanabe Pharma Corporation | Regulatory Milestone Payments | Development and Commercialize Collaboration Agreement | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Milestone revenue | $ 10,000,000 | ||||||||||||||||
Additional milestone revenue receivable | 15,000,000 | ||||||||||||||||
Mitsubishi Tanabe Pharma Corporation | Regulatory Milestone Payments | Development and Commercialize Collaboration Agreement | Maximum | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Upfront cash payment received | 40,000,000 | ||||||||||||||||
Mitsubishi Tanabe Pharma Corporation | Regulatory Milestone Payments | Development And Commercialize Research And License Agreement | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Milestone revenue | 10,000,000 | ||||||||||||||||
Mitsubishi Tanabe Pharma Corporation | Development, Regulatory and Commercial Events | Development and Commercialize Collaboration Agreement | Maximum | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Milestone revenue | 225,000,000 | ||||||||||||||||
Mitsubishi Tanabe Pharma Corporation | Development Milestones | Development and Commercialize Collaboration Agreement | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Milestone revenue | 10,000,000 | ||||||||||||||||
Mitsubishi Tanabe Pharma Corporation | Commercial Milestone Payments | Development and Commercialize Collaboration Agreement | Maximum | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Milestone revenue | 175,000,000 | ||||||||||||||||
Mitsubishi Tanabe Pharma Corporation | Upfront | Development and Commercialize Collaboration Agreement | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Incurred clinical and commercial development cost | 20,500,000 | ||||||||||||||||
Mitsubishi Tanabe Pharma Corporation | Development Milestones One | Development And Commercialize Research And License Agreement | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Milestone revenue | 6,000,000 | ||||||||||||||||
Mitsubishi Tanabe Pharma Corporation | Development Milestones Two | Development And Commercialize Research And License Agreement | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Milestone revenue | 4,000,000 | ||||||||||||||||
Mitsubishi Tanabe Pharma Corporation | Development and Commercialize Collaboration Agreement | Development And Commercialize Research And License Agreement | Accounts Receivable | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Accounts receivable | 0 | ||||||||||||||||
Otsuka Pharmaceutical Company. Ltd. | Development and Commercialize United States Collaboration and License Agreement | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Milestone revenue | $ 0 | ||||||||||||||||
Number of performance obligations | Obligation | 3 | ||||||||||||||||
Deferred revenue | $ 45,944,000 | ||||||||||||||||
Revenue on short-term or current liabilities | 19,090,000 | ||||||||||||||||
Collaborative arrangements cost sharing payments | 279,900,000 | ||||||||||||||||
Collaborative arrangements additional cost sharing payments amount | $ 60,000,000 | ||||||||||||||||
Percentage of market penetration for license agreement | 90.00% | ||||||||||||||||
License agreement, notice period for termination | 12 months | ||||||||||||||||
Transaction price | $ 438,700,000 | ||||||||||||||||
Reimbursement for Otsuka's share of costs previously incurred | $ 33,800,000 | ||||||||||||||||
Transaction price, description | As of March 31, 2020, the transaction price totaling $438.7 million is comprised of: (i) the up-front payment of $125.0 million, (ii) the cost share payment with respect to amounts incurred by the Company through December 31, 2016 of $33.8 million, and (iii) the estimate of the net cost share consideration to be received of approximately $279.9 million with respect to amounts incurred by the Company subsequent to December 31, 2016 and the Additional Funding. As of March 31, 2020, no development or regulatory milestones have been assessed as probable of being reached and thus have been fully constrained. | ||||||||||||||||
Deferred revenue, noncurrent | $ 26,854,000 | ||||||||||||||||
Cost share costs incurred | 500,000 | 300,000 | |||||||||||||||
Reimbursable by Otsuka | 300,000 | 200,000 | |||||||||||||||
Cost share costs by partner for license agreement | 400,000 | 400,000 | |||||||||||||||
Reimbursable to Otsuka | 200,000 | 200,000 | |||||||||||||||
Otsuka Pharmaceutical Company. Ltd. | Development and Commercialize United States Collaboration and License Agreement | Global Development Plan | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Reimbursement for Otsuka's share of costs previously incurred | $ 33,800,000 | ||||||||||||||||
Collaborative arrangements additional cost sharing payments expected amount | 104,200,000 | ||||||||||||||||
Otsuka Pharmaceutical Company. Ltd. | Development and Commercialize United States Collaboration and License Agreement | License, Collaboration and Other Revenue | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Recognized revenue under license agreement | 38,577,000 | 26,223,000 | |||||||||||||||
Otsuka Pharmaceutical Company. Ltd. | Development and Commercialize United States Collaboration and License Agreement | Accounts Receivable | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Accounts receivable | 49,300,000 | 8,900,000 | |||||||||||||||
Otsuka Pharmaceutical Company. Ltd. | Development and Commercialize United States Collaboration and License Agreement | Prepaid Expenses and Other Current Assets | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Accounts receivable | 400,000 | 0 | |||||||||||||||
Otsuka Pharmaceutical Company. Ltd. | Development and Commercialize United States Collaboration and License Agreement | Accrued Expenses and Other Current Liabilities | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Revenue on short-term or current liabilities | $ 400,000 | 0 | |||||||||||||||
Otsuka Pharmaceutical Company. Ltd. | Development and Commercialize United States Collaboration and License Agreement | Minimum | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Percentage of increase in funding to fund current global development costs | 52.50% | ||||||||||||||||
Reduction in percentage of future payments due upon current global development costs creditable | 50.00% | ||||||||||||||||
Percentage of remaining creditable amount applied to future payments | 50.00% | ||||||||||||||||
Otsuka Pharmaceutical Company. Ltd. | Development and Commercialize United States Collaboration and License Agreement | Minimum | Global Development Plan | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Collaborative arrangements cost sharing payments | $ 279,900,000 | ||||||||||||||||
Otsuka Pharmaceutical Company. Ltd. | Development and Commercialize United States Collaboration and License Agreement | Maximum | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Percentage of increase in funding to fund current global development costs | 80.00% | ||||||||||||||||
Otsuka Pharmaceutical Company. Ltd. | Development and Commercialize International Collaboration and License Agreement | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Number of performance obligations | Obligation | 3 | ||||||||||||||||
Deferred revenue | $ 23,073,000 | ||||||||||||||||
Revenue on short-term or current liabilities | $ 11,807,000 | ||||||||||||||||
License agreement, notice period for termination | 12 months | ||||||||||||||||
Transaction price | $ 286,200,000 | ||||||||||||||||
Reimbursement for Otsuka's share of costs previously incurred | $ 200,000 | ||||||||||||||||
Transaction price, description | As of March 31, 2020, the transaction price totaling $286.2 million is comprised of: (i) the up-front payment of $73.0 million, (ii) the cost share payment with respect to amounts incurred by the Company during the quarter ended March 31, 2017 of $0.2 million, and (iii) an estimate of the net cost share consideration to be received with respect to amounts incurred by the Company subsequent to March 31, 2017 of $213.0 million. As of March 31, 2020, no development or regulatory milestones have been assessed as probable of being reached and thus have been fully constrained. | ||||||||||||||||
Deferred revenue, noncurrent | $ 11,266,000 | ||||||||||||||||
Estimate Subsequent Cost Share Payment Receivable | 213,000,000 | ||||||||||||||||
Milestone or royalty payments received | $ 0 | ||||||||||||||||
Otsuka Pharmaceutical Company. Ltd. | Development and Commercialize International Collaboration and License Agreement | Global Development Plan | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Reimbursement for Otsuka's share of costs previously incurred | $ 200,000 | ||||||||||||||||
Otsuka Pharmaceutical Company. Ltd. | Development and Commercialize International Collaboration and License Agreement | License, Collaboration and Other Revenue | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Recognized revenue under license agreement | 19,370,000 | 21,956,000 | |||||||||||||||
Otsuka Pharmaceutical Company. Ltd. | Development and Commercialize International Collaboration and License Agreement | Accounts Receivable | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Accounts receivable | 22,400,000 | 4,000,000 | |||||||||||||||
Otsuka Pharmaceutical Company. Ltd. | Development and Commercialize International Collaboration and License Agreement | Prepaid Expenses and Other Current Assets | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Accounts receivable | 200,000 | 0 | |||||||||||||||
Otsuka Pharmaceutical Company. Ltd. | Development and Commercialize International Collaboration and License Agreement | Accrued Expenses and Other Current Liabilities | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Revenue on short-term or current liabilities | 200,000 | $ 0 | |||||||||||||||
Otsuka Pharmaceutical Company. Ltd. | Development and Commercialize International Collaboration and License Agreement | Minimum | Global Development Plan | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Estimate Subsequent Cost Share Payment Receivable | 213,000,000 | ||||||||||||||||
Otsuka Pharmaceutical Company. Ltd. | Regulatory Milestone Payments | Development and Commercialize United States Collaboration and License Agreement | Maximum | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Milestone revenue | 65,000,000 | ||||||||||||||||
Otsuka Pharmaceutical Company. Ltd. | Regulatory Milestone Payments | Development and Commercialize International Collaboration and License Agreement | Maximum | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Milestone revenue | 52,000,000 | ||||||||||||||||
Otsuka Pharmaceutical Company. Ltd. | Development Milestones | Development and Commercialize United States Collaboration and License Agreement | Maximum | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Upfront cash payment received | 125,000,000 | ||||||||||||||||
Otsuka Pharmaceutical Company. Ltd. | Development Milestones | Development and Commercialize International Collaboration and License Agreement | Maximum | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Upfront cash payment received | 80,000,000 | ||||||||||||||||
Otsuka Pharmaceutical Company. Ltd. | Commercial Milestone Payments | Development and Commercialize United States Collaboration and License Agreement | Maximum | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Milestone revenue | 575,000,000 | ||||||||||||||||
Otsuka Pharmaceutical Company. Ltd. | Commercial Milestone Payments | Development and Commercialize International Collaboration and License Agreement | Maximum | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Milestone revenue | 525,000,000 | ||||||||||||||||
Otsuka Pharmaceutical Company. Ltd. | Up-front, Non-refundable and Non-creditable | Development and Commercialize United States Collaboration and License Agreement | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Upfront cash payment received | $ 125,000,000 | 125,000,000 | |||||||||||||||
Otsuka Pharmaceutical Company. Ltd. | Up-front, Non-refundable and Non-creditable | Development and Commercialize International Collaboration and License Agreement | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Upfront cash payment received | $ 73,000,000 | 73,000,000 | |||||||||||||||
Otsuka Pharmaceutical Company. Ltd. | Development and Regulatory Milestones | Development and Commercialize United States Collaboration and License Agreement | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Milestone revenue | 0 | ||||||||||||||||
Otsuka Pharmaceutical Company. Ltd. | Development and Regulatory Milestones | Development and Commercialize International Collaboration and License Agreement | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Milestone revenue | $ 0 | ||||||||||||||||
Janssen Pharmaceutica NV | Development And Commercialize Research And License Agreement | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Collaboration Agreement, expiration period | 10 years | ||||||||||||||||
Collaboration Agreement, notice period for termination | 180 days | ||||||||||||||||
Upfront payment made in cash | $ 1,000,000 | ||||||||||||||||
Warrant to purchase common stock, shares | shares | 509,611 | ||||||||||||||||
Janssen Pharmaceutica NV | Development And Commercialize Research And License Agreement | Maximum | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Milestone revenue | $ 215,000,000 | ||||||||||||||||
Upfront cash payment received | $ 16,500,000 | ||||||||||||||||
Johnson & Johnson Innovation | Development And Commercialize Research And License Agreement | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Warrant to purchase common stock, shares | shares | 509,611 | ||||||||||||||||
Fair value of warrant | $ 3,400,000 | $ 3,400,000 | |||||||||||||||
Exercise price | $ / shares | $ 9.81 | ||||||||||||||||
Vifor (International) Ltd. | Research and Development Expense | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Payments after closing of PRV purchase | $ 10,000,000 | ||||||||||||||||
Vifor (International) Ltd. | License Agreement | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Milestone revenue | $ 25,000,000 | 25,000,000 | |||||||||||||||
License agreement, notice period for termination | 12 months | ||||||||||||||||
Deferred revenue, noncurrent | $ 4,700,000 | ||||||||||||||||
Common stock shares sold | shares | 3,571,429 | ||||||||||||||||
Sale of stock, price per share | $ / shares | $ 14 | ||||||||||||||||
Proceeds from common stock sold | $ 50,000,000 | ||||||||||||||||
Premium over the closing stock price of common stock | $ / shares | $ 12.69 | ||||||||||||||||
Premium amount over the closing stock price of common stock | $ 4,700,000 | ||||||||||||||||
Vifor (International) Ltd. | Priority Review Voucher Letter Agreement | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Payments after closing of PRV purchase | $ 10,000 | ||||||||||||||||
Japan Tobacco Incorporation and Torii Pharmaceutical Company Limited | License, Collaboration and Other Revenue | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Recognized revenue under license agreement | $ 1,126,000 | 1,228,000 | |||||||||||||||
Japan Tobacco Incorporation and Torii Pharmaceutical Company Limited | License Agreement | Panion & BF Biotech, Incorporation | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Royalty payments | $ 2,500,000 | 2,100,000 | |||||||||||||||
Japan Tobacco Incorporation and Torii Pharmaceutical Company Limited | Sublicense Agreement | |||||||||||||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | |||||||||||||||||
Number of performance obligations | Obligation | 2 | ||||||||||||||||
Recognized revenue under license agreement | $ 1,100,000 | $ 1,200,000 | |||||||||||||||
License agreement, notice period for termination | 6 months | ||||||||||||||||
Potential payment for achievement of annual net sales milestones | $ 55,000,000 | ||||||||||||||||
Prior written notice for termination on the breach of agreement period | 60 days | ||||||||||||||||
[1] | Excludes accounts receivable from other services related to clinical and regulatory activities performed by the Company on behalf of MTPC that are not included in the performance obligations identified under the MTPC Agreement as of March 31, 2019 and 2020 and December 31, 2018 and 2019. Also excludes accounts receivable related to amounts due to the Company from product sales which are included in the accompanying unaudited condensed consolidated balance sheet as of March 31, 2020 and December 31, 2019. |
Business Combination - Addition
Business Combination - Additional Information (Details) | Dec. 12, 2018USD ($) | Mar. 31, 2020USD ($)shares |
Business Acquisition [Line Items] | ||
Total fair value consideration | $ 527,754,000 | |
Intangible assets, estimated useful life | 9 years | |
Keryx Biopharmaceuticals, Inc. | ||
Business Acquisition [Line Items] | ||
Total fair value consideration | $ 527,754,000 | |
Business combination, Purchase price | $ 527,754,000 | |
Risk-adjusted discount rate used to calculate present value of future expected cash inflows of intangible assets | 20.00% | |
Preliminary fair value of the off-market element | $ 29,510,000 | |
Goodwill deductible for tax purposes | $ 0 | |
Deferred tax liabilities | $ 35,100,000 | |
Keryx Biopharmaceuticals, Inc. | Auryxia | ||
Business Acquisition [Line Items] | ||
Intangible assets, estimated useful life | 9 years | |
Keryx Biopharmaceuticals, Inc. | Common Stock | ||
Business Acquisition [Line Items] | ||
Total fair value consideration | $ 516,492,000 | |
Keryx Biopharmaceuticals, Inc. | Merger Agreement | ||
Business Acquisition [Line Items] | ||
Outstanding common stock and awards converted into right to receive shares and awards, ratio | 0.37433 | 0.37433 |
Total fair value consideration | $ 527,800,000 | |
Additional shares expected to be issued | shares | 4,000,000 | |
Aggregate shares available for conversion | shares | 39,600,000 | |
Fair value of additional shares issued | $ 13,400,000 | |
Keryx Biopharmaceuticals, Inc. | Notes Conversion Agreement | ||
Business Acquisition [Line Items] | ||
Convertible notes amount | $ 164,700,000 | |
Keryx Biopharmaceuticals, Inc. | Notes Conversion Agreement | Common Stock | ||
Business Acquisition [Line Items] | ||
Convertible notes converted into shares | shares | 35,582,335 |
Business Combination - Summary
Business Combination - Summary of Total Fair Value Consideration (Details) - USD ($) $ in Thousands | Dec. 12, 2018 | Mar. 31, 2020 |
Business Acquisition [Line Items] | ||
Total fair value consideration | $ 527,754 | |
Keryx Biopharmaceuticals, Inc. | ||
Business Acquisition [Line Items] | ||
Total fair value consideration | $ 527,754 | |
Keryx Biopharmaceuticals, Inc. | Akebia Shares | ||
Business Acquisition [Line Items] | ||
Total fair value consideration | 516,492 | |
Keryx Biopharmaceuticals, Inc. | Akebia RSUs | ||
Business Acquisition [Line Items] | ||
Total fair value consideration | 304 | |
Keryx Biopharmaceuticals, Inc. | Akebia Stock Options | ||
Business Acquisition [Line Items] | ||
Total fair value consideration | $ 10,958 |
Business Combination - Summar_2
Business Combination - Summary of Total Fair Value Consideration (Parenthetical) (Details) - Keryx Biopharmaceuticals, Inc. | Dec. 12, 2018shares |
Akebia Shares | |
Business Acquisition [Line Items] | |
Shares issued | 57,773,090 |
Akebia RSUs | |
Business Acquisition [Line Items] | |
RSU / Options issued | 602,752 |
Akebia Stock Options | |
Business Acquisition [Line Items] | |
RSU / Options issued | 3,967,290 |
Business Combination - Summar_3
Business Combination - Summary of Purchase Price of Identifiable Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 | Dec. 12, 2018 |
Business Acquisition [Line Items] | |||
Goodwill | $ 55,053 | $ 55,053 | |
Keryx Biopharmaceuticals, Inc. | |||
Business Acquisition [Line Items] | |||
Cash and cash equivalents | $ 5,257 | ||
Inventory | 235,597 | ||
Trade accounts receivable, net | 15,834 | ||
Prepaid expenses and other current assets | 8,399 | ||
Goodwill | 55,053 | ||
Intangible assets: | |||
Developed product rights for Auryxia | 329,130 | ||
Other intangible assets | 545 | ||
Property and equipment, net | 3,646 | ||
Other assets | 14,441 | ||
Accounts payable | (17,570) | ||
Accrued expenses | (42,972) | ||
Deferred tax liability | (35,096) | ||
Debt | (15,000) | ||
Fair value of unfavorable executory contract | (29,510) | ||
Total purchase price | $ 527,754 |
Available for Sale Securities -
Available for Sale Securities - Summary of Cash Cash Equivalents and Available for Sale Securities Fair Value (Details) - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2019 |
Schedule Of Available For Sale Securities [Line Items] | |||
Cash and cash equivalents | $ 115,374,000 | $ 147,449,000 | $ 62,741,000 |
Cash and cash equivalents, Fair Value | 115,374,000 | 147,449,000 | |
Total cash, cash equivalents, and available for sale securities - Amortized Cost | 115,374,000 | 147,694,000 | |
Total cash, cash equivalents, and available for sale securities - Fair Value | 115,374,000 | 147,694,000 | |
Amortized Cost | 245,000 | ||
Fair Value | $ 0 | 245,000 | |
Certificates of Deposit | |||
Schedule Of Available For Sale Securities [Line Items] | |||
Amortized Cost | 245,000 | ||
Fair Value | $ 245,000 |
Available for Sale Securities_2
Available for Sale Securities - Additional Information (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2019 | Mar. 31, 2020 | Dec. 31, 2019 | |
Investments Debt And Equity Securities [Abstract] | |||
Gains (losses) on available for sale securities | $ 0 | ||
Available for sale securities | $ 0 | $ 245,000 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments - Assets Measured or Disclosed at Fair Value on Recurring Basis (Details) - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Cash and cash equivalents | $ 115,374,000 | $ 147,449,000 |
Derivative liability | 1,740,000 | 1,650,000 |
Level 3 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets Measured at fair value on recurring basis | 0 | 0 |
Fair value measurements recurring | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Cash and cash equivalents | 115,374,000 | 147,449,000 |
Assets Measured at fair value on recurring basis | 115,374,000 | 147,694,000 |
Derivative liability | 1,740,000 | 1,650,000 |
Liabilities measured at fair value on recurring basis | 1,740,000 | 1,650,000 |
Fair value measurements recurring | Certificates of deposit | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets Measured at fair value on recurring basis | 245,000 | |
Fair value measurements recurring | Level 1 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Cash and cash equivalents | 115,374,000 | 147,449,000 |
Assets Measured at fair value on recurring basis | 115,374,000 | 147,449,000 |
Fair value measurements recurring | Level 2 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets Measured at fair value on recurring basis | 245,000 | |
Fair value measurements recurring | Level 2 | Certificates of deposit | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets Measured at fair value on recurring basis | 245,000 | |
Fair value measurements recurring | Level 3 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Derivative liability | 1,740,000 | 1,650,000 |
Liabilities measured at fair value on recurring basis | $ 1,740,000 | $ 1,650,000 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments - Additional Information (Details) - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Derivative liability | $ 1,740,000 | $ 1,650,000 |
Level 3 | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Assets Measured at fair value on recurring basis | 0 | 0 |
Level 3 | Other than Derivative Liabilities | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Liabilities measured at fair value on recurring basis | 0 | 0 |
Collateral Agent, Pharmakon | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Derivative liability | $ 1,700,000 | $ 1,700,000 |
Fair Value of Financial Instr_5
Fair Value of Financial Instruments - Schedule of Fair Value Derivative Liability (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2020USD ($) | |
Fair Value Disclosures [Abstract] | |
Balance at December 31, 2019 | $ 1,650 |
Change in fair value of derivative liability, recorded as other expense | 90 |
Balance at March 31, 2020 | $ 1,740 |
Inventory - Components of Inven
Inventory - Components of Inventory (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 1,841 | $ 2,278 |
Work in process | 135,474 | 137,858 |
Finished goods | 36,925 | 42,096 |
Total inventory | 174,240 | 182,232 |
Inventory | 111,854 | 116,349 |
Other assets | $ 62,386 | $ 65,883 |
Inventory - Additional Informat
Inventory - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Inventory Disclosure [Abstract] | ||
Inventory amounts written down | $ 139 | $ 1,664 |
Intangible Assets and Goodwil_2
Intangible Assets and Goodwill - Summary of Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2020 | Dec. 31, 2019 | |
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | $ 329,675 | $ 329,675 |
Accumulated Amortization | (47,023) | (37,923) |
ASC 842 Adjustment | (540) | (540) |
Total | $ 282,112 | 291,212 |
Estimated useful life | 9 years | |
Developed Product Rights for Auryxia | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | $ 329,130 | 329,130 |
Accumulated Amortization | (47,018) | (37,918) |
Total | $ 282,112 | $ 291,212 |
Estimated useful life | 9 years | 9 years |
Favourable Lease | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | $ 545 | $ 545 |
Accumulated Amortization | (5) | (5) |
ASC 842 Adjustment | $ (540) | $ (540) |
Intangible Assets and Goodwil_3
Intangible Assets and Goodwill - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Finite Lived Intangible Assets [Line Items] | |||
Amortization expense | $ 9,100 | $ 9,100 | |
Goodwill | 55,053 | $ 55,053 | |
Developed Product Rights for Auryxia | |||
Finite Lived Intangible Assets [Line Items] | |||
Amortization expense | $ 9,100 | $ 9,100 |
Intangible Assets and Goodwil_4
Intangible Assets and Goodwill - Schedule of Estimated Future Amortization Expense for Intangible Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Goodwill And Intangible Assets Disclosure [Abstract] | ||
2020 | $ 27,302 | |
2021 | 36,401 | |
2022 | 36,402 | |
2023 | 36,401 | |
2024 | 36,402 | |
Thereafter | 109,204 | |
Total | $ 282,112 | $ 291,212 |
Intangible Assets and Goodwil_5
Intangible Assets and Goodwill - Schedule of Goodwill (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Goodwill And Intangible Assets Disclosure [Abstract] | ||
Total Merger consideration | $ 527,754 | |
Less: Fair value of identified acquired assets and liabilities, net | (472,701) | |
Goodwill | $ 55,053 | $ 55,053 |
Accrued Expenses - Components o
Accrued Expenses - Components of Accrued Expenses (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Payables And Accruals [Abstract] | ||
Accrued clinical | $ 54,581 | $ 61,815 |
Product revenue allowances | 31,225 | 30,552 |
Accrued payroll | 7,727 | 12,604 |
MTPC - Supply of Validation Drug Product | 6,441 | |
Lease liability | 5,096 | 4,989 |
Professional fees | 3,949 | 3,444 |
Accrued commercial manufacturing | 2,694 | 2,680 |
Royalties | 2,459 | 2,713 |
Accrued severance | 452 | 725 |
Accrued other | 10,263 | 9,549 |
Total accrued expenses | $ 124,887 | $ 129,071 |
Debt - Schedule of Future Princ
Debt - Schedule of Future Principal Payments on the Term Loans (Details) $ in Thousands | Mar. 31, 2020USD ($) |
Debt Disclosure [Abstract] | |
2022 | $ 7,140 |
2023 | 30,354 |
2024 | 42,506 |
Total before unamortized discount and issuance costs | 80,000 |
Less: unamortized discount and issuance costs | (3,928) |
Total term loans | $ 76,072 |
Debt - Additional Information (
Debt - Additional Information (Details) - USD ($) | Nov. 11, 2019 | Mar. 31, 2020 | Dec. 31, 2019 | Nov. 25, 2019 |
Line Of Credit Facility [Line Items] | ||||
Term loan, net of facility fees, lender expenses and issuance costs | $ 76,072,000 | |||
Derivative liability | 1,740,000 | $ 1,650,000 | ||
Collateral Agent, Pharmakon | ||||
Line Of Credit Facility [Line Items] | ||||
Derivative liability | $ 1,700,000 | $ 1,700,000 | ||
Biopharma Credit Investments V (Master) LP | Keryx | Term Loan | Collateral Agent, Pharmakon | ||||
Line Of Credit Facility [Line Items] | ||||
Line of credit, maximum borrowing capacity | $ 100,000,000 | |||
Term loan, maturity date, description | The Term Loans will mature on the fifth anniversary of the Tranche A Funding Date, or the Maturity Date. | |||
Term loan payment description | The Company will repay the principal under the Term Loans in equal quarterly payments starting on the 33rd-month anniversary of the applicable Funding Date or, if certain conditions are met, it will have the option to repay the principal in equal quarterly payments starting on the 48th-month anniversary of the applicable Funding Date, or collectively the Amortization Schedule. Under certain circumstances, unless certain liquidity conditions are met, the Maturity Date may decrease by up to one year, and the Amortization Schedule may correspondingly commence up to one year earlier | |||
Facility fee percentage on principal amount | 2.00% | |||
Facility fee paid, amount | $ 2,000,000 | |||
Prepayment premium percentage on principal if prepaid prior to third anniversary of funding | 2.00% | |||
Prepayment premium percentage on principal if prepaid prior to fourth anniversary and after third anniversary of funding | 1.00% | |||
Prepayment premium percentage on principal if prepaid after fourth anniversary of funding | 0.50% | |||
Interest expense | $ 2,200,000 | |||
Biopharma Credit Investments V (Master) LP | Keryx | Term Loan | Collateral Agent, Pharmakon | Three-month LIBOR | ||||
Line Of Credit Facility [Line Items] | ||||
Basis spread on floating interest rate | 7.50% | |||
Biopharma Credit Investments V (Master) LP | Keryx | Term Loan | Collateral Agent, Pharmakon | LIBOR | ||||
Line Of Credit Facility [Line Items] | ||||
Debt instrument, floor rate | 2.00% | |||
Debt instrument, cap rate | 3.35% | |||
Biopharma Credit Investments V (Master) LP | Keryx | Term Loan | Collateral Agent, Pharmakon | Tranche A | ||||
Line Of Credit Facility [Line Items] | ||||
Line of credit, maximum borrowing capacity | $ 80,000,000 | |||
Amount drawn under credit facility, date | Nov. 25, 2019 | |||
Term loan, net of facility fees, lender expenses and issuance costs | $ 77,300,000 | |||
Biopharma Credit Investments V (Master) LP | Keryx | Term Loan | Collateral Agent, Pharmakon | Tranche B | ||||
Line Of Credit Facility [Line Items] | ||||
Line of credit, maximum borrowing capacity | $ 20,000,000 | |||
Last date to draw amount under credit facility | Dec. 31, 2020 |
Warrant - Additional Informatio
Warrant - Additional Information (Details) - Janssen Agreement - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Feb. 28, 2017 | |
Class Of Warrant Or Right [Line Items] | ||
Warrant to purchase common stock, shares | 509,611 | |
Exercise price | $ 9.81 | |
Fair value of warrant at issuance | $ 3.4 | |
Warrant expiration date | Feb. 9, 2022 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Details) | Mar. 12, 2020USD ($) | Feb. 28, 2020shares | Nov. 12, 2019USD ($) | Feb. 28, 2019shares | Dec. 12, 2018shares | Mar. 31, 2020USD ($)Installment$ / sharesshares | Mar. 31, 2019USD ($)shares | Dec. 31, 2019USD ($)$ / sharesshares | Dec. 31, 2018shares | Feb. 28, 2014shares |
Class of Stock [Line Items] | ||||||||||
Common stock, shares authorized | 175,000,000 | 175,000,000 | ||||||||
Common stock, par value | $ / shares | $ 0.00001 | $ 0.00001 | ||||||||
Common stock, shares issued | 130,251,440 | 121,674,568 | ||||||||
Common stock, shares outstanding | 130,251,440 | 121,674,568 | ||||||||
Preferred stock, shares authorized | 25,000,000 | 25,000,000 | ||||||||
Preferred stock, par value | $ / shares | $ 0.00001 | $ 0.00001 | ||||||||
Preferred stock, shares issued | 0 | 0 | ||||||||
Preferred stock, shares outstanding | 0 | 0 | ||||||||
Proceeds from the issuance of common stock, net of issuance costs | $ | $ 56,485,000 | |||||||||
Common stock, shares reserved for future issuance | 24,958,932 | 21,403,890 | ||||||||
Stock-based compensation expense | $ | $ 4,916,000 | $ 2,094,000 | ||||||||
Inducement Award Program | ||||||||||
Class of Stock [Line Items] | ||||||||||
Granted, Shares | 299,450 | |||||||||
Outstanding, Shares | 299,450 | |||||||||
Inducement Award Program | Employees | ||||||||||
Class of Stock [Line Items] | ||||||||||
Granted, Shares | 299,450 | |||||||||
Stock Options | ||||||||||
Class of Stock [Line Items] | ||||||||||
Shares issued | 1,714,800 | |||||||||
Stock-based compensation description | Options vest either 100% on the first anniversary of the grant date or in installments of (i) 25% at the one year anniversary and (ii) 12 equal quarterly installments beginning after the one year anniversary of the grant date, subject to the individual’s continuous service with the Company | |||||||||
Options expiration after the date of grant | 10 years | |||||||||
Stock-based compensation expense | $ | $ 1,617,000 | 1,112,000 | ||||||||
Stock Options | Share-based Compensation Award, Tranche, First Anniversary of Grant Date | ||||||||||
Class of Stock [Line Items] | ||||||||||
Vesting percentage | 100.00% | |||||||||
Stock Options | Share Based Compensation Award Tranche One | ||||||||||
Class of Stock [Line Items] | ||||||||||
Vesting periods | 1 year | |||||||||
Vesting percentage | 25.00% | |||||||||
Stock Options | Share Based Compensation Award Tranche Two | ||||||||||
Class of Stock [Line Items] | ||||||||||
Number of equal quarterly installments | Installment | 12 | |||||||||
Restricted Stock Units | ||||||||||
Class of Stock [Line Items] | ||||||||||
Granted, Shares | 2,268,000 | |||||||||
Stock-based compensation description | Generally, RSUs granted by the Company vest in one of the following ways: (i) 100% of each RSU grant vests on either the first or the third anniversary of the grant date, (ii) one third of each RSU grant vests on the first, second and third anniversaries of the grant date, subject, in each case, to the individual’s continued service through the applicable vesting date, or (iii) 50% of each RSU grant vests on the first anniversary and 25% of each RSU grant vests in 6 months increment after the one year anniversary of the grant date. | |||||||||
Stock-based compensation expense | $ | $ 3,142,000 | 934,000 | ||||||||
Restricted Stock Units | Share Based Compensation Award Tranche One | ||||||||||
Class of Stock [Line Items] | ||||||||||
Vesting percentage | 50.00% | |||||||||
Restricted Stock Units | Share Based Compensation Award Tranche Two | ||||||||||
Class of Stock [Line Items] | ||||||||||
Vesting periods | 6 months | |||||||||
Vesting percentage | 25.00% | |||||||||
Restricted Stock Units | Share-based Compensation Award, Tranche, First Or Third Anniversary of Grant Date | ||||||||||
Class of Stock [Line Items] | ||||||||||
Vesting percentage | 100.00% | |||||||||
Performance Based Restricted Stock Unit | ||||||||||
Class of Stock [Line Items] | ||||||||||
Granted, Shares | 479,000 | |||||||||
Stock-based compensation expense | $ | $ 100,000 | $ 0 | ||||||||
Performance-Based Stock Options | ||||||||||
Class of Stock [Line Items] | ||||||||||
Granted, Shares | 0 | 0 | ||||||||
Oustanding, Shares | 0 | 0 | 46,790 | |||||||
Vesting percentage, Following achievement of performance condition | 50.00% | |||||||||
Performance-Based Stock Options | Keryx Biopharmaceuticals, Inc. | Merger Agreement | ||||||||||
Class of Stock [Line Items] | ||||||||||
Granted, Shares | 233,954 | |||||||||
Common Stock | ||||||||||
Class of Stock [Line Items] | ||||||||||
Common stock, shares outstanding | 130,251,440 | 117,122,262 | 121,674,568 | 116,887,518 | ||||||
Issuance of common stock, net of issuance costs, shares | 7,973,967 | |||||||||
Minimum | Stock Options | ||||||||||
Class of Stock [Line Items] | ||||||||||
Vesting periods | 12 months | |||||||||
Minimum | Restricted Stock Units | ||||||||||
Class of Stock [Line Items] | ||||||||||
Vesting periods | 1 year | |||||||||
Minimum | Performance-Based Stock Options | ||||||||||
Class of Stock [Line Items] | ||||||||||
Potential share issuable percentage | 0.00% | |||||||||
Maximum | Stock Options | ||||||||||
Class of Stock [Line Items] | ||||||||||
Vesting periods | 48 months | |||||||||
Maximum | Restricted Stock Units | ||||||||||
Class of Stock [Line Items] | ||||||||||
Vesting periods | 3 years | |||||||||
Maximum | Performance-Based Stock Options | ||||||||||
Class of Stock [Line Items] | ||||||||||
Potential share issuable percentage | 100.00% | |||||||||
Vesting percentage, upon achievement of performance condition | 50.00% | |||||||||
At The Market Equity Offering Program | ||||||||||
Class of Stock [Line Items] | ||||||||||
Common stock sales agreement amount | $ | $ 0 | |||||||||
At The Market Equity Offering Program | Common Stock | ||||||||||
Class of Stock [Line Items] | ||||||||||
Issuance of common stock, net of issuance costs, shares | 7,973,967 | 2,684,392 | ||||||||
Proceeds from the issuance of common stock, net of issuance costs | $ | $ 56,700,000 | $ 16,800,000 | ||||||||
At The Market Equity Offering Program | Maximum | ||||||||||
Class of Stock [Line Items] | ||||||||||
Common stock sales agreement amount | $ | $ 65,000,000 | $ 75,000,000 | ||||||||
2014 Plans | ||||||||||
Class of Stock [Line Items] | ||||||||||
Common stock, shares reserved for future issuance | 1,785,000 | |||||||||
Incremental rate at which the shares reserved for issuance increase | 3.00% | |||||||||
2014 Plans | Stock Options | Employees | ||||||||||
Class of Stock [Line Items] | ||||||||||
Granted, Shares | 1,714,800 | |||||||||
2014 Plans | Stock Options | Director | ||||||||||
Class of Stock [Line Items] | ||||||||||
Granted, Shares | 0 | |||||||||
2014 Plans | Restricted Stock Units | Employees | ||||||||||
Class of Stock [Line Items] | ||||||||||
Granted, Shares | 2,350,400 | |||||||||
2014 Plans | Restricted Stock Units | Director | ||||||||||
Class of Stock [Line Items] | ||||||||||
Granted, Shares | 0 | |||||||||
2014 Plans | Performance Based Restricted Stock Unit | Employees | ||||||||||
Class of Stock [Line Items] | ||||||||||
Granted, Shares | 479,000 | |||||||||
2014 Employee Stock Purchase Plan | ||||||||||
Class of Stock [Line Items] | ||||||||||
Common stock, shares reserved for future issuance | 5,600,968 | |||||||||
Purchase price at the end of offering period | 85.00% | |||||||||
Offering period | 6 months | |||||||||
Shares issued | 115,024 | |||||||||
Stock-based compensation expense | $ | $ 157,000 | $ 48,000 |
Stockholders' Equity - Summary
Stockholders' Equity - Summary of Reserved Shares of Common Stock for Future Issuance (Details) - shares | Mar. 31, 2020 | Dec. 31, 2019 |
Class of Stock [Line Items] | ||
Common stock, shares reserved for future issuance | 24,958,932 | 21,403,890 |
Warrant To Purchase Common Stock | ||
Class of Stock [Line Items] | ||
Common stock, shares reserved for future issuance | 509,611 | 509,611 |
Common Stock Options and RSUs Outstanding | ||
Class of Stock [Line Items] | ||
Common stock, shares reserved for future issuance | 16,107,645 | 12,195,031 |
Shares Available for Issuance Under Akebia Equity | ||
Class of Stock [Line Items] | ||
Common stock, shares reserved for future issuance | 2,740,708 | 2,983,256 |
Shares Available for Issuance Under the ESPP | ||
Class of Stock [Line Items] | ||
Common stock, shares reserved for future issuance | 5,600,968 | 5,715,992 |
Stockholders' Equity - Summar_2
Stockholders' Equity - Summary of Reserved Shares of Common Stock for Future Issuance (Parenthetical) (Details) - shares | Jan. 01, 2020 | Jun. 06, 2019 | Jan. 01, 2019 | Dec. 12, 2018 | Feb. 28, 2018 | Jan. 01, 2018 | Feb. 28, 2017 | Mar. 31, 2020 | Dec. 31, 2019 | Jan. 30, 2019 | Feb. 28, 2016 | Feb. 28, 2014 |
Class of Stock [Line Items] | ||||||||||||
Common stock, shares reserved for future issuance | 24,958,932 | 21,403,890 | ||||||||||
Shares Available for Issuance Under the ESPP | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Increase in common stock, shares reserved for future issuance | 5,200,000 | 0 | 0 | |||||||||
Common stock, shares reserved for future issuance | 5,600,968 | 5,715,992 | ||||||||||
Maximum aggregate number of shares available for purchase | 739,611 | |||||||||||
2014 Plans | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Increase in common stock, shares reserved for future issuance | 4,031,376 | 3,801,198 | 2,323,213 | 1,575,329 | ||||||||
Common stock, shares reserved for future issuance | 1,785,000 | |||||||||||
Inducement Award Program | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Common stock, shares reserved for future issuance | 3,150,000 |
Stockholders Equity - Stock-Bas
Stockholders Equity - Stock-Based Compensation Expense Related to Share-Based Awards (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense | $ 4,916 | $ 2,094 |
Research and Development | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense | 1,542 | 878 |
Selling, General and Administrative | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense | $ 3,374 | $ 1,216 |
Stockholders Equity - Schedule
Stockholders Equity - Schedule of Compensation Expense by Type of Award (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense | $ 4,916,000 | $ 2,094,000 |
Stock Options | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense | 1,617,000 | 1,112,000 |
Restricted Stock Units | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense | 3,142,000 | 934,000 |
2014 Employee Stock Purchase Plan | ||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||
Stock-based compensation expense | $ 157,000 | $ 48,000 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) | Apr. 09, 2019 | Jan. 01, 2017USD ($) | Sep. 30, 2019 | Apr. 30, 2018USD ($)ft² | Jul. 31, 2016USD ($)ft² | Mar. 31, 2020USD ($)ft²Extension_Option | Mar. 31, 2019USD ($) | Dec. 12, 2018USD ($) |
Commitments And Contingencies [Line Items] | ||||||||
Lessee, operating lease, residual value guarantee, description | The lease agreements do not contain residual value guarantees. | |||||||
Lessee, operating lease, residual value guarantee | false | |||||||
Operating lease, cost | $ 1,700,000 | $ 1,700,000 | ||||||
Operating lease, payments | $ 1,700,000 | $ 1,700,000 | ||||||
Supply agreement description | The Esteve Agreement has an initial term of four years, beginning April 9, 2019 and ending April 9, 2023 | |||||||
Initial term of supply agreement | four years | |||||||
Total remaining contract costs | $ 41,100,000 | |||||||
Contract cost incurred in research and development activities | 67,400,000 | |||||||
Supply Agreement [Member] | ||||||||
Commitments And Contingencies [Line Items] | ||||||||
Minimum Commitment through the first quarter of 2021 | $ 0 | |||||||
BioVectra Inc | ||||||||
Commitments And Contingencies [Line Items] | ||||||||
Agreement expiration year | 2026 | |||||||
Description of termination of agreement prior to contract term | The Company may terminate the BioVectra Agreement prior to the expiration of the contract term, which could result in early termination fee. | |||||||
Cost of purchased minimum quantity product | $ 135,300,000 | |||||||
Preliminary fair value of the off-market element | $ 29,500,000 | |||||||
Accretion expense | 900,000 | |||||||
Siegfried Evionnaz SA | ||||||||
Commitments And Contingencies [Line Items] | ||||||||
Cost of purchased minimum quantity product | $ 53,300,000 | |||||||
Agreement expiration date | Dec. 31, 2021 | |||||||
Agreement renewal term termination | 1 year | |||||||
Agreement early termination | Dec. 31, 2021 | |||||||
Esteve Química, S.A | ||||||||
Commitments And Contingencies [Line Items] | ||||||||
Minimum Commitment through the first quarter of 2021 | $ 6,000 | |||||||
Minimum Commitment through the second quarter of 2021 | $ 13,600 | |||||||
Minimum | ||||||||
Commitments And Contingencies [Line Items] | ||||||||
Operating lease, incremental borrowing rates based on remaining lease term | 5.91% | |||||||
Operating lease, remaining lease term | 1 year 8 months 1 day | |||||||
Maximum | ||||||||
Commitments And Contingencies [Line Items] | ||||||||
Operating lease, incremental borrowing rates based on remaining lease term | 6.94% | |||||||
Operating lease, remaining lease term | 6 years 5 months 12 days | |||||||
Keryx Biopharmaceuticals, Inc. | ||||||||
Commitments And Contingencies [Line Items] | ||||||||
Preliminary fair value of the off-market element | $ 29,510,000 | |||||||
Cambridge | ||||||||
Commitments And Contingencies [Line Items] | ||||||||
Area of property leased | ft² | 65,167 | 45,362 | ||||||
Monthly lease payments | $ 22,000 | $ 242,000 | ||||||
Operating lease payments commencement date | Jan. 1, 2017 | |||||||
Cambridge | Letter of Credit | Other Current Assets | ||||||||
Commitments And Contingencies [Line Items] | ||||||||
Total security deposit in connection with lease | $ 1,600,000 | |||||||
Cambridge | Office Space | ||||||||
Commitments And Contingencies [Line Items] | ||||||||
Area of property leased | ft² | 19,805 | |||||||
Monthly lease payments | $ 135,000 | |||||||
Operating lease payments commencement date | Feb. 28, 2019 | |||||||
Leased property delivered, date | 2018-09 | |||||||
Leased property subject to annual rent escalations, commencement date | 2019-09 | |||||||
Lease expiration date | Sep. 11, 2026 | |||||||
Lease period, number of extension options | Extension_Option | 1 | |||||||
Lease extension period | 5 years | |||||||
Cambridge | Lab Space | ||||||||
Commitments And Contingencies [Line Items] | ||||||||
Lease expiration date | Nov. 30, 2021 | |||||||
Lease period, number of extension options | Extension_Option | 1 | |||||||
Lease extension period | 2 years | |||||||
Boston | Keryx Biopharmaceuticals, Inc. | Letter of Credit | Other Current Assets | ||||||||
Commitments And Contingencies [Line Items] | ||||||||
Total security deposit in connection with lease | $ 800,000 | |||||||
Boston | Office Space | ||||||||
Commitments And Contingencies [Line Items] | ||||||||
Area of property leased | ft² | 27,300 | |||||||
Monthly lease payments | $ 136,000 | |||||||
Lease expiration month year | 2023-02 | |||||||
Boston | Office Space | Keryx Biopharmaceuticals, Inc. | ||||||||
Commitments And Contingencies [Line Items] | ||||||||
Lease expiration date | Feb. 28, 2023 | |||||||
Lease period, number of extension options | Extension_Option | 1 | |||||||
Lease extension period | 5 years | |||||||
Operating sublease commencement date | Oct. 16, 2019 | |||||||
Sublease expiration date | Feb. 28, 2023 | |||||||
Sublease rental income | $ 400,000 |
Commitments and Contingencies_2
Commitments and Contingencies - Schedule of Undiscounted Minimum Rental Commitments Under Non-cancelable Leases (Details) $ in Thousands | Mar. 31, 2020USD ($) |
Commitments And Contingencies Disclosure [Abstract] | |
Operating Leases, remaining 2020 | $ 4,820 |
Operating Leases, 2021 | 7,064 |
Operating Leases, 2022 | 6,735 |
Operating Leases, 2023 | 5,347 |
Operating Leases, 2024 | 5,116 |
Operating Leases, Thereafter | 8,818 |
Operating Leases, Total | 37,900 |
Lease Payments to be Received from Sublease, remaining 2020 | 1,328 |
Lease Payments to be Received from Sublease, 2021 | 1,797 |
Lease Payments to be Received from Sublease, 2022 | 1,824 |
Lease Payments to be Received from Sublease, 2023 | 307 |
Lease Payments to be Received from Sublease, Total | 5,256 |
Net Operating Lease Payments, remaining 2020 | 3,492 |
Net Operating Lease Payments, 2021 | 5,267 |
Net Operating Lease Payments, 2022 | 4,911 |
Net Operating Lease Payments, 2023 | 5,040 |
Net Operating Lease Payments, 2024 | 5,116 |
Net Operating Lease Payments, Thereafter | 8,818 |
Net Operating Lease Payments, Total | $ 32,644 |
Commitments and Contingencies_3
Commitments and Contingencies - Schedule of Undiscounted Minimum Rental Commitments Under Non-cancelable Leases and Operating Leases Liabilities (Details) $ in Thousands | Mar. 31, 2020USD ($) |
Commitments And Contingencies Disclosure [Abstract] | |
Operating Leases, Total | $ 37,900 |
Present value adjustment using incremental borrowing rate | (6,596) |
Operating lease liabilities | $ 31,304 |
Net Loss per Share - Anti-Dilut
Net Loss per Share - Anti-Dilutive Securities Excluded from Calculation of Diluted Net Loss per Share (Details) - shares | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from calculation of diluted net loss per share | 16,617,256 | 12,830,125 |
Warrant | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from calculation of diluted net loss per share | 509,611 | 509,611 |
Stock Options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from calculation of diluted net loss per share | 9,371,675 | 10,261,827 |
Restricted Stock Units | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-dilutive securities excluded from calculation of diluted net loss per share | 6,735,970 | 2,058,687 |