Cover
Cover - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2020 | Feb. 05, 2021 | Jun. 30, 2020 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2020 | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Entity Registrant Name | SORRENTO THERAPEUTICS, INC. | ||
Entity Central Index Key | 0000850261 | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Interactive Data Current | Yes | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Public Float | $ 1.4 | ||
Entity Common Stock, Shares Outstanding (in shares) | 280,322,985 | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Title of 12(b) Security | Common Stock, par value $0.0001 per share | ||
Trading Symbol | SRNE | ||
Security Exchange Name | NASDAQ | ||
Entity File Number | 001-36150 | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 33-0344842 | ||
Entity Address, Address Line One | 4955 Directors Place | ||
Entity Address, City or Town | San Diego | ||
Entity Address, State or Province | CA | ||
Entity Address, Postal Zip Code | 92121 | ||
City Area Code | 858 | ||
Local Phone Number | 203-4100 | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Documents Incorporated by Reference | None. |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 56,464 | $ 22,521 |
Restricted cash | 13,098 | |
Accounts receivables, net | 15,506 | 14,454 |
Inventory | 1,831 | 3,362 |
Prepaid expenses | 8,712 | 11,750 |
Other current assets | 3,721 | 2,403 |
Total current assets | 86,234 | 67,588 |
Property and equipment, net | 31,861 | 29,888 |
Operating lease right-of-use assets | 42,052 | 46,384 |
Intangibles, net | 73,675 | 63,308 |
Goodwill | 43,554 | 38,298 |
Equity investments | 256,397 | 262,241 |
Restricted cash | 45,150 | |
Other assets, net | 2,049 | 4,775 |
Total assets | 535,822 | 557,632 |
Current liabilities: | ||
Accounts payable | 24,706 | 27,630 |
Accrued payroll and related benefits | 20,859 | 15,914 |
Accrued expenses | 19,198 | 18,728 |
Current portion of deferred revenue | 4,485 | 3,643 |
Current portion of derivative liabilities | 8,800 | |
Current portion of operating lease liabilities | 3,626 | 3,322 |
Acquisition consideration payable | 398 | 908 |
Current portion of debt | 23,208 | 36,261 |
Total current liabilities | 96,480 | 115,206 |
Long-term debt, net of discount | 92,258 | 199,088 |
Deferred tax liabilities, net | 6,918 | 9,043 |
Deferred revenue | 113,185 | 114,389 |
Derivative liabilities | 35,400 | 35,000 |
Operating lease liabilities | 50,301 | 52,111 |
Other long-term liabilities | 549 | 39 |
Total liabilities | 395,091 | 524,876 |
Commitments and contingencies (Note 11) | ||
Sorrento Therapeutics, Inc. equity | ||
Common stock, $0.0001 par value; 750,000,000 shares authorized and 275,285,582 and 167,798,120 shares issued and outstanding at December 31, 2020 and 2019, respectively | 28 | 18 |
Additional paid-in capital | 1,172,346 | 788,122 |
Accumulated other comprehensive income | 520 | (270) |
Accumulated deficit | (958,279) | (659,818) |
Treasury stock, 7,568,182 shares at cost at December 31, 2020 and 2019 | (49,464) | (49,464) |
Total Sorrento Therapeutics, Inc. stockholders' equity | 165,151 | 78,588 |
Noncontrolling interests | (24,420) | (45,832) |
Total equity | 140,731 | 32,756 |
Total liabilities and equity | $ 535,822 | $ 557,632 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2020 | Dec. 31, 2019 |
Statement Of Financial Position [Abstract] | ||
Common stock, par value (USD per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 750,000,000 | 750,000,000 |
Common stock, shares issued (in shares) | 275,285,582 | 167,798,120 |
Common stock, shares outstanding (in shares) | 275,285,582 | 167,798,120 |
Treasury stock, shares (in shares) | 7,568,182 | 7,568,182 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Revenue: | |||
Revenues | $ 39,986 | $ 31,432 | $ 21,193 |
Operating costs and expenses: | |||
Research and development | 111,340 | 106,879 | 76,963 |
Acquired in-process research and development | 42,992 | 75,301 | 11,304 |
Selling, general and administrative | 116,179 | 103,557 | 63,638 |
Intangible amortization | 4,053 | 3,941 | 3,009 |
(Gain) loss on contingent liabilities and acquisition consideration payable | (11,090) | 9,644 | |
Total operating costs and expenses | 284,504 | 290,825 | 171,618 |
Loss from operations | (244,518) | (259,393) | (150,425) |
Gain (loss) on derivative liabilities | 6,600 | (36,792) | 2,830 |
Gain (loss) on foreign currency exchange | 812 | (330) | (1,243) |
Other income (loss) | (1,378) | (203) | (144) |
Interest expense | (20,181) | (36,139) | (57,631) |
Interest income | 24 | 1,091 | 921 |
Loss on debt extinguishment | (51,939) | (27,810) | (8,089) |
Loss before income tax | (310,580) | (359,576) | (213,781) |
Income tax benefit | (2,014) | (473) | (6,274) |
Loss on equity method investments | (5,844) | (3,909) | (5,019) |
Net loss | (314,410) | (363,012) | (212,526) |
Net loss attributable to noncontrolling interests | (15,949) | (70,944) | (8,986) |
Net loss attributable to Sorrento | $ (298,461) | $ (292,068) | $ (203,540) |
Net loss per share - basic per share attributable to Sorrento | $ (1.30) | $ (2.20) | $ (1.92) |
Net loss per share - diluted per share attributable to Sorrento | $ (1.30) | $ (2.35) | $ (1.92) |
Weighted-average shares outstanding during period - basic per share attributable to Sorrento (in shares) | 229,823 | 132,732 | 106,150 |
Weighted-average shares outstanding during period - diluted per share attributable to Sorrento (in shares) | 229,823 | 140,514 | 106,150 |
Product | |||
Revenue: | |||
Revenues | $ 26,628 | $ 21,974 | $ 5,873 |
Operating costs and expenses: | |||
Cost of products sold and services | 2,149 | 5,933 | 1,476 |
Service | |||
Revenue: | |||
Revenues | 13,358 | 9,458 | 15,320 |
Operating costs and expenses: | |||
Cost of products sold and services | $ 7,791 | $ 6,304 | $ 5,584 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Statement Of Income And Comprehensive Income [Abstract] | |||
Net loss | $ (314,410) | $ (363,012) | $ (212,526) |
Other comprehensive income (loss): | |||
Foreign currency translation adjustments | 790 | (285) | (227) |
Total other comprehensive income (loss) | 790 | (285) | (227) |
Comprehensive loss | (313,620) | (363,297) | (212,753) |
Comprehensive loss attributable to noncontrolling interests | (15,949) | (70,944) | (8,986) |
Comprehensive loss attributable to Sorrento | $ (297,671) | $ (292,353) | $ (203,767) |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Cumulative Effect, Period of Adoption, Adjustment | Public Placement | Public Offering Of Common Stock And Warrants 2019 | Registered Direct Offering 2019 | 2019 Warrants | December 2019 Warrants | BDL Products Inc | Scilex Pharmaceuticals, Inc | Virttu Biologics Limited | Semnur | SmartPharm | Common Stock | Common StockPublic Placement | Common StockPublic Offering Of Common Stock And Warrants 2019 | Common StockRegistered Direct Offering 2019 | Common StockBDL Products Inc | Common StockScilex Pharmaceuticals, Inc | Common StockVirttu Biologics Limited | Common StockSmartPharm | Treasury Stock | Additional Paid-in Capital | Additional Paid-in CapitalPublic Placement | Additional Paid-in CapitalPublic Offering Of Common Stock And Warrants 2019 | Additional Paid-in CapitalRegistered Direct Offering 2019 | Additional Paid-in Capital2019 Warrants | Additional Paid-in CapitalDecember 2019 Warrants | Additional Paid-in CapitalBDL Products Inc | Additional Paid-in CapitalScilex Pharmaceuticals, Inc | Additional Paid-in CapitalVirttu Biologics Limited | Additional Paid-in CapitalSemnur | Additional Paid-in CapitalSmartPharm | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit | Accumulated DeficitCumulative Effect, Period of Adoption, Adjustment | Noncontrolling Interest | Noncontrolling InterestSemnur |
Balance at Dec. 31, 2017 | $ 206,610 | $ 910 | $ 9 | $ (49,464) | $ 413,901 | $ 242 | $ (165,120) | $ 910 | $ 7,042 | ||||||||||||||||||||||||||||
Balance, shares (in shares) at Dec. 31, 2017 | 82,904,000 | 7,568,000 | |||||||||||||||||||||||||||||||||||
Accounting Standards Update [Extensible List] | us-gaap:AccountingStandardsUpdate201409Member | ||||||||||||||||||||||||||||||||||||
Issuance of common stock upon exercise of stock options | 211 | 211 | |||||||||||||||||||||||||||||||||||
Issuance of common stock upon exercise of stock options (in shares) | 58,000 | ||||||||||||||||||||||||||||||||||||
Issuance of common stock upon acquisition | $ 2,340 | $ 13,744 | $ 11,308 | $ 2,340 | $ 13,744 | $ 11,308 | |||||||||||||||||||||||||||||||
Issuance of common stock upon acquisition (in shares) | 310,000 | 1,381,000 | 1,795,000 | ||||||||||||||||||||||||||||||||||
Issuance of common stock, net | $ 83,610 | $ 2 | $ 83,608 | ||||||||||||||||||||||||||||||||||
Issuance of common stock, net (in shares) | 13,794,000 | ||||||||||||||||||||||||||||||||||||
Issuance of common stock, conversion of notes payable | 50,000 | $ 2 | 49,998 | ||||||||||||||||||||||||||||||||||
Issuance of common stock, conversion of notes payable (in shares) | 22,039,000 | ||||||||||||||||||||||||||||||||||||
Beneficial conversion feature recorded on convertible notes | 12,006 | 12,006 | |||||||||||||||||||||||||||||||||||
Warrants issued in connection with convertible notes | 9,646 | 9,646 | |||||||||||||||||||||||||||||||||||
Warrants issued in connection with Term Loan Agreement | 21,746 | 21,746 | |||||||||||||||||||||||||||||||||||
Loss on debt extinguishment | 1,916 | 1,916 | |||||||||||||||||||||||||||||||||||
Stock-based compensation | 6,206 | 6,234 | (28) | ||||||||||||||||||||||||||||||||||
Foreign currency translation adjustment | (227) | (227) | |||||||||||||||||||||||||||||||||||
Net loss | (212,526) | (203,540) | (8,986) | ||||||||||||||||||||||||||||||||||
Balance at Dec. 31, 2018 | 207,500 | $ 13 | $ (49,464) | 626,658 | 15 | (367,750) | (1,972) | ||||||||||||||||||||||||||||||
Balance, shares (in shares) at Dec. 31, 2018 | 122,281,000 | 7,568,000 | |||||||||||||||||||||||||||||||||||
Issuance of common stock upon exercise of stock options | 492 | 492 | |||||||||||||||||||||||||||||||||||
Issuance of common stock upon exercise of stock options (in shares) | 268,000 | ||||||||||||||||||||||||||||||||||||
Issuance of common stock upon exercise of warrants | 8,359 | 8,359 | |||||||||||||||||||||||||||||||||||
Issuance of common stock upon issuance of warrants (in shares) | 3,128,000 | ||||||||||||||||||||||||||||||||||||
Issuance of common stock, net | $ 990 | $ 23,323 | $ 23,385 | $ 1 | $ 1 | $ 990 | $ 23,322 | $ 23,384 | |||||||||||||||||||||||||||||
Issuance of common stock, net (in shares) | 259,000 | 8,333,000 | 10,870,000 | ||||||||||||||||||||||||||||||||||
Issuance of common stock, conversion of notes payable | 53,983 | $ 54,591 | $ 3 | 53,980 | $ 27,991 | $ 26,600 | |||||||||||||||||||||||||||||||
Issuance of common stock, conversion of notes payable (in shares) | 22,660,000 | ||||||||||||||||||||||||||||||||||||
Warrants issued in connection with convertible notes | $ 4,288 | $ 6,010 | $ 4,288 | $ 6,010 | |||||||||||||||||||||||||||||||||
Adjustment to noncontrolling interest | 484 | 484 | |||||||||||||||||||||||||||||||||||
Stock-based compensation | 12,648 | 12,648 | |||||||||||||||||||||||||||||||||||
Foreign currency translation adjustment | (285) | (285) | |||||||||||||||||||||||||||||||||||
Net loss | (363,012) | (292,068) | (70,944) | ||||||||||||||||||||||||||||||||||
Balance at Dec. 31, 2019 | 32,756 | $ 18 | $ (49,464) | 788,122 | (270) | (659,818) | (45,832) | ||||||||||||||||||||||||||||||
Balance, shares (in shares) at Dec. 31, 2019 | 167,799,000 | 7,568,000 | |||||||||||||||||||||||||||||||||||
Issuance of common stock upon exercise of stock options | $ 5,578 | 5,578 | |||||||||||||||||||||||||||||||||||
Issuance of common stock upon exercise of stock options (in shares) | 1,301,671 | 1,339,000 | |||||||||||||||||||||||||||||||||||
Issuance of common stock upon exercise of warrants | $ 92,773 | $ 3 | 92,770 | ||||||||||||||||||||||||||||||||||
Issuance of common stock upon issuance of warrants (in shares) | 33,091,000 | ||||||||||||||||||||||||||||||||||||
Issuance of common stock upon acquisition | 9,544 | 9,544 | |||||||||||||||||||||||||||||||||||
Issuance of common stock upon acquisition (in shares) | 1,997,000 | ||||||||||||||||||||||||||||||||||||
Issuance of common stock, net | 317,865 | $ 7 | 317,858 | ||||||||||||||||||||||||||||||||||
Issuance of common stock, net (in shares) | 69,228,000 | ||||||||||||||||||||||||||||||||||||
Issuance of common stock, conversion of notes payable | $ 19,421 | $ 19,421 | |||||||||||||||||||||||||||||||||||
Issuance of common stock, conversion of notes payable (in shares) | 1,832,000 | ||||||||||||||||||||||||||||||||||||
Changes to NCI | (55,005) | (92,366) | 37,361 | ||||||||||||||||||||||||||||||||||
Stock-based compensation | 31,419 | 31,419 | |||||||||||||||||||||||||||||||||||
Foreign currency translation adjustment | 790 | 790 | |||||||||||||||||||||||||||||||||||
Net loss | (314,410) | (298,461) | (15,949) | ||||||||||||||||||||||||||||||||||
Balance at Dec. 31, 2020 | $ 140,731 | $ 28 | $ (49,464) | $ 1,172,346 | $ 520 | $ (958,279) | $ (24,420) | ||||||||||||||||||||||||||||||
Balance, shares (in shares) at Dec. 31, 2020 | 275,286,000 | 7,568,000 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Operating activities: | |||
Net loss | $ (314,410,000) | $ (363,012,000) | $ (212,526,000) |
Adjustments to reconcile net loss to net cash used for operating activities: | |||
Depreciation and amortization | 11,007,000 | 10,989,000 | 9,494,000 |
Non-cash interest expense and amortization of debt issuance costs | 12,897,000 | 22,526,000 | 53,391,000 |
Non-cash operating lease cost | 3,702,000 | 4,053,000 | |
Stock-based compensation | 31,419,000 | 12,648,000 | 6,206,000 |
Acquired in-process research and development | 42,992,000 | 75,301,000 | 9,895,000 |
Loss on debt extinguishment | 51,939,000 | 27,810,000 | 8,089,000 |
(Gain) loss on derivative liability | (6,600,000) | 36,792,000 | (2,830,000) |
Loss on equity method investments | 5,844,000 | 3,909,000 | 5,019,000 |
(Gain) loss on contingent liabilities and acquisition consideration payable | (11,090,000) | 9,644,000 | |
Loss on IPR&D impairment | 1,826,000 | ||
Deferred income tax benefit | (2,125,000) | (373,000) | (6,119,000) |
Changes in operating assets and liabilities, excluding effect of acquisitions: | |||
Accounts receivable | (1,051,000) | (10,622,000) | (1,623,000) |
Accrued payroll | 4,945,000 | 5,678,000 | 5,751,000 |
Prepaid expenses and other current assets | 6,445,000 | (314,000) | (2,660,000) |
Accounts payable | (3,677,000) | 10,221,000 | 3,578,000 |
Accrued expenses and other liabilities | (1,188,000) | 4,061,000 | 6,130,000 |
Deferred revenue | (362,000) | (945,000) | (3,263,000) |
Acquisition consideration payable | (2,020,000) | ||
Other | (1,313,000) | (628,000) | 251,000 |
Net cash used for operating activities | (159,536,000) | (172,996,000) | (111,767,000) |
Investing activities: | |||
Purchases of property and equipment | (6,528,000) | (11,442,000) | (11,195,000) |
Purchase of assets related to Semnur, net of cash acquired | (17,040,000) | ||
Payments related to license agreements | (31,051,000) | ||
Other acquisitions and investments | (2,344,000) | (9,691,000) | (10,000,000) |
Net cash used for investing activities | (39,923,000) | (38,173,000) | (21,195,000) |
Financing activities: | |||
Proceeds from exercises of stock options and warrants | 98,351,000 | 8,851,000 | 211,000 |
Proceeds from issuance of Scilex notes, net of issuance costs | 134,275,000 | ||
Proceeds from issuance of convertible notes | 37,849,000 | ||
Proceeds from short-term debt and working capital funding arrangements, net of issuance costs | 18,587,000 | 8,000,000 | 21,261,000 |
Payments of debt and other obligations | (205,564,000) | (3,074,000) | (42,466,000) |
Payments related to Semnur Share Exchange | (55,000,000) | ||
Net cash provided by financing activities | 174,239,000 | 78,885,000 | 325,998,000 |
Net change in cash, cash equivalents and restricted cash | (25,220,000) | (132,284,000) | 193,036,000 |
Net effect of exchange rate changes on cash | 915,000 | (277,000) | (135,000) |
Cash, cash equivalents and restricted cash at beginning of period | 80,769,000 | 213,330,000 | 20,429,000 |
Cash, cash equivalents and restricted cash at end of period | 56,464,000 | 80,769,000 | 213,330,000 |
Cash paid during the period for: | |||
Income taxes | 13,000 | 6,000 | |
Interest | 3,419,000 | 12,738,000 | 1,620,000 |
Supplemental disclosures of non-cash investing and financing activities: | |||
Semnur acquisition costs incurred but not paid | 601,000 | ||
Other acquisitions, license agreements and investments paid in equity | 9,544,000 | 13,648,000 | |
Conversion of convertible notes | 53,983,000 | 50,000,000 | |
Loss on debt extinguishment | 9,646,000 | ||
Property and equipment costs incurred but not paid | 600,000 | 849,000 | 328,000 |
Reconciliation of cash, cash equivalents and restricted cash within the Company's consolidated balance sheets: | |||
Cash and cash equivalents | 56,464,000 | 22,521,000 | 158,738,000 |
Restricted cash | 0 | 58,248,000 | 54,592,000 |
Cash, cash equivalents, and restricted cash | 56,464,000 | 80,769,000 | 213,330,000 |
Public Offering Of Common Stock And Warrants 2019 | |||
Financing activities: | |||
Proceeds from issuance of common stock | 317,865,000 | 47,697,000 | 83,608,000 |
SmartPharm | |||
Supplemental disclosures of non-cash investing and financing activities: | |||
Acquisition consideration paid in equity | $ 19,421,000 | ||
Semnur | |||
Supplemental disclosures of non-cash investing and financing activities: | |||
Acquisition consideration paid in equity | 54,591,000 | ||
Scilex Pharmaceuticals, Inc | |||
Supplemental disclosures of non-cash investing and financing activities: | |||
Non-cash consideration given | 13,744,000 | ||
Oaktree Term Loan | |||
Financing activities: | |||
Proceeds from Oaktree Term Loans, net of issuance costs | $ 17,411,000 | 91,260,000 | |
June 2018 Warrants, Amendment | |||
Supplemental disclosures of non-cash investing and financing activities: | |||
Loss on debt extinguishment | $ 1,916,000 |
Organization and Significant Ac
Organization and Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Organization and Significant Accounting Policies | 1. Organization and Significant Accounting Policies Description of Business Sorrento Therapeutics, Inc. (the “Company”) is a clinical stage, antibody-centric, biopharmaceutical company developing new therapies to treat cancers and COVID-19. The Company’s multimodal, multipronged approach to fighting cancer is made possible by its extensive immuno-oncology platforms, including key assets such as fully human antibodies (“G-MAB™ library”), clinical stage immuno-cellular therapies (“CAR-T”, “DAR-T™”), antibody-drug conjugates (“ADCs”) and clinical stage oncolytic virus (Seprehvir™). The Company is also developing potential antiviral therapies and vaccines against coronaviruses, including COVI-GUARD™, COVI-AMG™, COVI-SHIELD™, Gene-MAb™, COVI-MSC™ and COVI-DROPS™; and diagnostic test solutions, including COVI-TRACK™, COVI-STIX™ and COVI-TRACE™. The Company’s commitment to life-enhancing therapies for patients is also demonstrated by our effort to advance a first-in-class (TRPV1 agonist) non-opioid pain management small molecule, resiniferatoxin (“RTX”), and SP-102 (10 mg, dexamethasone sodium phosphate viscous gel) (SEMDEXA™), a novel, viscous gel formulation of a widely used corticosteroid for epidural injections to treat lumbosacral radicular pain, or sciatica, and through the commercialization of ZTlido ® Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company`s subsidiaries. For consolidated entities where the Company owns or is exposed to less than 100% of the economics, the Company records net income (loss) attributable to noncontrolling interests in its consolidated statements of operations equal to the percentage of the economic or ownership interest retained in such entities by the respective noncontrolling parties. All intercompany balances and transactions have been eliminated in consolidation. The Company operates in two operating and reportable segments, Sorrento Therapeutics and Scilex. Use of Estimates The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Management believes that these estimates are reasonable; however, actual results may differ from these estimates. Cash and Cash Equivalents The Company considers all highly liquid investments purchased with original maturities of three months or less to be cash equivalents. Cash and cash equivalents consist of money market accounts and bank deposits, which are highly liquid and readily tradable. Restricted Cash As of December 31, 2020 there was no restricted cash in the Company`s consolidated balance sheet. Restricted cash in the Company's consolidated balance sheet as of December 31, 2019 included approximately $45.0 million of restricted cash related to the Scilex Notes in the form of both the Reserve Account and the Collateral Account (See Note 8 Fair Value of Financial Instruments The Company follows accounting guidance on fair value measurements for financial instruments measured on a recurring basis, as well as for certain assets and liabilities that are initially recorded at their estimated fair values. Fair value is defined as the exit price, or the amount that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company uses the following three-level hierarchy that maximizes the use of observable inputs and minimizes the use of unobservable inputs to value its financial instruments: • Level 1: Observable inputs such as unadjusted quoted prices in active markets for identical instruments. • Level 2: Quoted prices for similar instruments that are directly or indirectly observable in the marketplace. • Level 3: Significant unobservable inputs which are supported by little or no market activity and that are financial instruments whose values are determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant judgment or estimation. Financial instruments measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires it to make judgments and consider factors specific to the asset or liability. The use of different assumptions and/or estimation methodologies may have a material effect on estimated fair values. Accordingly, the fair value estimates disclosed or initial amounts recorded may not be indicative of the amount that the Company or holders of the instruments could realize in a current market exchange. The carrying amounts of cash equivalents approximate their fair value based upon quoted market prices. Certain of the Company’s financial instruments are not measured at fair value on a recurring basis, but are recorded at amounts that approximate their fair value due to their liquid or short-term nature, such as accounts receivable and payable, and other financial instruments in current assets or current liabilities. Accounts Receivable, Net Accounts receivable are presented net of allowances for expected credit losses and consist of trade receivables from sales and services provided to certain customers, which are generally unsecured. Estimated credit losses related to trade accounts receivable are recorded as general and administrative expenses and as an allowance for doubtful accounts and accounts receivable, net. The Company reviews reserves and makes adjustments based on historical experience and known collectability issues and disputes. When internal collection efforts on accounts have been exhausted, the accounts are written off by reducing the allowance for doubtful accounts. The allowance for doubtful accounts is not material. Inventory, Net The Company determines inventory cost on a first-in, first-out basis. The Company reduces the carrying value of inventories to a lower of cost or net realizable value for those items that are potentially excess, obsolete or slow-moving. The Company considers the need for allowances for excess and obsolete inventory based upon historical experience, sales trends, and specific categories of inventory and expiration dates for inventory on hand. As of December 31, 2020, net inventory was $1.8 million and primarily comprised of finished goods. Net inventory as of December 31, 2019 was $3.4 million and primarily comprised of finished goods. Property and Equipment Property and equipment are carried at cost less accumulated depreciation. Depreciation of property and equipment is computed using the straight-line method over the estimated useful lives of the assets, which are generally three to five years. Leasehold improvements are amortized over the lesser of the life of the lease or the life of the asset. Repairs and maintenance are charged to expense as incurred. Acquisitions The Company accounts for business combinations using the acquisition method of accounting, which requires that assets acquired, including in-process research and development (“IPR&D”) projects and liabilities assumed be recorded at their fair values as of the acquisition date on the Company`s consolidated balance sheets. Any excess of purchase price over the fair value of net assets acquired is recorded as goodwill. The determination of estimated fair value requires the Company to make significant estimates and assumptions. As a result, the Company may record adjustments to the fair values of assets acquired and liabilities assumed within the measurement period (up to one year from the acquisition date) with the corresponding offset to goodwill. Transaction costs associated with business combinations are expensed as they are incurred. When the Company determines net assets acquired do not meet the definition of a business combination under the acquisition method of accounting, the transaction is accounted for as an acquisition of assets and, therefore, no goodwill is recorded and contingent consideration such as payments upon achievement of various developmental, regulatory and commercial milestones generally is not recognized at the acquisition date. In an asset acquisition, up-front payments allocated to IPR&D projects at the acquisition date and subsequent milestone payments are charged to expense in the Company`s consolidated statements of operations unless there is an alternative future use. Acquired In-Process Research and Development Expense The Company has acquired, and may continue to acquire, the rights to develop and commercialize new drug candidates. The up-front payments to acquire new drug compounds or drug delivery devices, as well as future milestone payments associated with assets that do not meet the definition of a derivative and that are deemed probable to achieve , are immediately expensed as acquired IPR&D , provided that the drug candidates ha ve not achieved regulatory approval for marketing and, absent obtaining such approval, have no alternative future use. Intangible assets acquired in a business combination that are used for IPR&D activities are considered indefinite lived until the completion or abandonment of the associated research and development efforts. Upon commercialization of the relevant research and development project, the Company amortizes the acquired IPR&D over its estimated useful life. Capitalized IPR&D is reviewed annually for impairment or more frequently as changes in circumstance or the occurrence of events suggest that the remaining value may not be recoverable. Goodwill and Other Long-Lived Assets Goodwill, which has an indefinite useful life, represents the excess of cost over fair value of net assets acquired. Goodwill is reviewed at the reporting unit level for impairment at least annually during the fourth quarter, or more frequently if events occur indicating the potential for impairment. During its goodwill impairment review, the Company assesses qualitative factors to determine whether it is more likely than not that the fair value of its reporting unit is less than its carrying amount, including goodwill. The qualitative factors include, but are not limited to, macroeconomic conditions, industry and market considerations, and the overall financial performance of the Company. If, after assessing the totality of these qualitative factors, the Company determines that it is not more likely than not that the fair value of its reporting unit is less than its carrying amount, then no additional assessment is deemed necessary. Otherwise, the Company performs a quantitative goodwill impairment test. The Company may also elect to bypass the qualitative assessment in a period and elect to proceed to perform the quantitative goodwill impairment test. The Company performed its annual assessment for goodwill impairment at the Sorrento Therapeutics and Scilex reporting unit levels in the fourth quarter of 2020, noting no indication of impairment. There were no triggering events indicating the potential for impairment through December 31, 2020. The Company evaluates its long-lived and intangible assets with definite lives, such as property and equipment, acquired technology, customer relationships, patent and license rights, for impairment by considering the expected use of the assets and the effects of obsolescence, demand, anticipated technological advances, market influences and other economic factors. The factors that drive the estimate of useful life are often uncertain and are reviewed on a periodic basis or when events occur that warrant review. Recoverability is measured by comparison of the assets’ book value to future net undiscounted cash flows that the assets are expected to generate. No impairment charges were recorded during the year ended December 31, 2020. Debt, Including Debt With Detachable Warrants Detachable warrants are evaluated for the classification of warrants as either equity instruments, derivative liabilities, or liabilities depending on the specific terms of the warrant agreement. In circumstances in which debt is issued with equity-classified warrants, the proceeds from the issuance of debt are first allocated to the debt and the warrants at their relative estimated fair values. The portion of the proceeds allocated to the warrants are accounted for as paid-in capital and a debt discount. The remaining proceeds, as further reduced by discounts created by the bifurcation of embedded derivatives and beneficial conversion features, are allocated to the debt. The Company accounts for debt as liabilities measured at amortized cost and amortizes the resulting debt discount from the allocation of proceeds, to interest expense using the effective interest method over the expected term of the debt instrument. The Company considers whether there are any embedded features in debt instruments that require bifurcation and separate accounting as derivative financial instruments pursuant to Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 815, Derivatives and Hedging If the amount allocated to the convertible debt results in an effective per share conversion price less than the fair value of the Company’s common stock on the commitment date, the intrinsic value of this beneficial conversion feature is recorded as a discount to the convertible debt with a corresponding increase to additional paid in capital. The beneficial conversion feature discount is equal to the difference between the effective conversion price and the fair value of the Company’s common stock at the commitment date, unless limited by the remaining proceeds allocated to the debt. The Company may enter financing arrangements, the terms of which involve significant assumptions and estimates, including future net product sales, in determining interest expense, amortization period of the debt discount, as well as the classification between current and long-term portions. In estimating future net product sales, the Company assesses prevailing market conditions using various external market data against the Company’s anticipated sales and planned commercial activities. Consequently, the Company imputes interest on the carrying value of the debt and records interest expense using an imputed effective interest rate. The Company reassesses the expected payments each reporting period and accounts for any changes through an adjustment to the effective interest rate on a prospective basis, with a corresponding impact to the classification of the Company’s current and long-term portions. Derivative Liabilities Derivative liabilities are recorded on the Company`s consolidated balance sheets at their fair value on the date of issuance and are revalued on each balance sheet date until such instruments are settled or expire, with changes in the fair value between reporting periods recorded as other income or expense. Investments in Other Entities The Company holds a portfolio of investments in equity securities. Investments in entities over which the Company has significant influence, but not a controlling interest, are accounted for using the equity method, with the Company’s share of earnings or losses reported in loss on equity method investments. Research and Development Costs The Company expenses the cost of research and development as incurred. Research and development expenses are comprised of costs incurred in performing research and development activities, including clinical trial costs, manufacturing costs for both clinical and preclinical materials as well as other contracted services, license fees and other external costs. Nonrefundable advance payments for goods and services that will be used in future research and development activities are expensed when the activity is performed or when the goods have been received, rather than when payment is made, in accordance with FASB ASC Topic 730, Research and Development Income Taxes The provisions of the FASB ASC Topic 740 “Income Taxes,” The Company accounts for income taxes using the asset and liability method to compute the differences between the tax basis of assets and liabilities and the related financial amounts, using currently enacted tax rates. The Company has deferred tax assets, which are subject to periodic recoverability assessments. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount that more likely than not will be realized. As of December 31, 2020, the Company maintained a full valuation allowance against its deferred tax assets, with the exception of an amount equal to its deferred tax liabilities that are scheduled to reverse against the Company's deferred tax assets. Leases The Company determines if an arrangement is a lease at inception. Operating lease right-of-use (“ROU”) assets and lease liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. As the Company`s leases do not provide an implicit rate, it uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The Company calculates the associated lease liability and corresponding ROU asset upon lease commencement using a discount rate based on a credit-adjusted secured borrowing rate commensurate with the term of the lease. The operating lease ROU asset also includes any lease payments made and is reduced by lease incentives. The Company`s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. Revenue Recognition The Company`s revenues are generated from product revenues, the sale of customized reagents and other materials, contract manufacturing services, and other service revenues. The following table shows revenue disaggregated by product and service type for the years ended December 31, 2020, 2019 and 2018 (in thousands): Years Ended December 31, 2020 2019 2018 Scilex Pharmaceuticals Inc. product sales $ 26,331 $ 21,033 $ 2,606 Other product revenue 297 941 3,267 Net product revenue $ 26,628 $ 21,974 $ 5,873 Concortis Biosystems Corporation 7,730 6,520 5,159 Bioserv Corporation 4,976 2,450 5,992 Joint development agreement — — 3,333 Other service revenue 652 488 836 Service revenue $ 13,358 $ 9,458 $ 15,320 The Company is obligated to accept from customers the return of products sold that are damaged or do not meet certain specifications. The Company may authorize the return of products sold in accordance with the terms of its sales contracts and estimates allowances for such amounts at the time of sale. The Company has not experienced any material sales returns. The Company does not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts for which it recognizes revenue at the amount to which it has the right to invoice for services performed. Scilex Product Sales Revenues from product sales is fully comprised of sales of ZTlido. The Company's performance obligation with respect to sales of ZTlido is satisfied at a point in time, which transfers control upon delivery of product to the customer. The Company considers control to have transferred upon delivery because the customer has legal title to the asset, physical possession of the asset has been transferred to the customer, the customer has significant risks and rewards of ownership of the asset, and the Company has a present right to payment at that time. The Company identified a single performance obligation. Invoicing typically occurs upon shipment and the length of time between invoicing and when payment is due is not significant. The aggregate dollar value of unfulfilled orders as of December 31, 2020 was not material. Sales of ZTlido are generated within the United States. Substantially all of the Company’s product revenue and accounts receivable result from a sole customer. For product sales, the Company records gross-to-net sales adjustments for government and managed care rebates, chargebacks, wholesaler and distributor fees, sales returns and prompt payment discounts. Such variable consideration is estimated in the period of the sale and are estimated using a most likely amount approach based primarily upon provisions included in the Company’s customer contract, customary industry practices and current government regulations. Other Product Revenue Revenues from the sale of materials associated with the Company's research and development arrangements are recognized at a point in time upon the transfer of control, which is generally upon shipment. Concortis Biosystems Corporation ( “ ” Contract manufacturing associated with sales of customized reagents for Concortis operations relate to providing synthetic expertise to customers’ synthesis by delivering proprietary cytotoxins, linkers and linker-toxins and ADC service using industry standard toxin and antibodies provided by customers which are recognized at a point in time upon the transfer of control, which is generally upon shipment given the short contract terms which are generally three months or less. Bioserv Corporation ( “ ” Contract manufacturing services associated with the Company’s Bioserv operations related to finish and fill activities for drug products and reagents are recognized ratably over the contract term, which reflects the transfer of services to the customer because the manufactured products are highly customized and do not have an alternative use to the Company. As of December 31, 2020 and 2019, the estimated revenue expected to be recognized for future performance obligations associated with contract manufacturing services was approximately $3.4 million and $2.2 million, respectively. Joint Development Agreement In 2017, the Company entered into a joint development agreement with Celularity Inc. (“Celularity”) whereby the Company agreed to provide research services to Celularity through June 2018 in exchange for an upfront payment of $5.0 million. The revenue related to the joint development agreement of $5.0 million was recognized over the length of the service agreement as services were performed. The Company recorded sales and services revenues under the joint development agreement of $3.3 million for the year ended December 31, 2018. The Company recorded no sales and services revenues under the joint development agreement during the years ended December 31, 2020 and 2019 as such arrangement is complete. Other Service Revenue License fees for the licensing of product rights are recorded as deferred revenue upon receipt of cash and recognized as revenue on a straight-line basis over the license period, with the exception of license agreements with no remaining performance obligations or undelivered obligations. The Company applies judgment in determining the timing of revenue recognition related to contracts that include multiple performance obligations. The total transaction price of the contract is allocated to each performance obligation in an amount based on the estimated relative standalone selling prices of the promised goods or services underlying each performance obligation. For goods or services for which observable standalone selling prices are not available, the Company develops an estimated standalone selling price of each performance obligation. As of December 31, 2020, future performance obligations for license revenues relate to the ImmuneOncia Therapeutics, LLC (“ImmuneOncia”) and NantCell, Inc. (“NantCell”) license agreements. The total consideration for the ImmuneOncia license performance obligation, effective September 1, 2016, represented $9.6 million. The estimated revenue expected to be recognized for future performance obligations, as of December 31, 2020, was approximately $7.5 million. The Company expects to recognize license revenue of approximately $0.5 million of the remaining performance obligation annually through the remaining term. The Company applied judgment in estimating the 20-year contract term, analogous to the expected life of the patent, over which revenue is recognized over time given the ongoing performance obligation related to the Company's participation on a steering committee for the technologies under the agreement. As of December 31, 2020 and 2019, the NantCell license agreement, effective April 21, 2015, represented $110.0 million of contract liabilities reflected in long-term deferred revenue. See Note 7 In November 2020, the Company was awarded a contract with the Defense Advanced Research Projects Agency (“DARPA Contract”) and co-funded by the Joint Program Executive Office for Chemical, Biological, Radiological and Nuclear Defense, to develop a rapid countermeasure to COVID-19 using gene-encoded neutralizing antibodies. The contract provides SmartPharm Therapeutics, Inc. (“SmartPharm”) funding of up to $34.0 million for the development through Phase II clinical studies of a gene-encoded antibody that could enable from and/or treatment of SARS-CoV-2 infection and COVID-19. The Company recognized $0.2 million in grant revenue associated with the DARPA Contract during the year ended December 31, 2020, which is included within other service revenue. Stock-Based Compensation The Company estimates the fair value of stock option awards and its ESPP on the grant or offering date using the Black-Scholes option-pricing model. The Black-Scholes option-pricing model requires inputs such as the risk-free interest rate, expected term and expected volatility.Stock-based compensation expense is recognized on a straight-line basis, net of actual forfeitures in the period. Comprehensive Loss Comprehensive loss is primarily comprised of net income (loss) and foreign currency translation adjustments. The Company displays comprehensive loss and its components in its consolidated statements of comprehensive loss. Net Income (Loss) per Share Basic net income (loss) per share is computed by dividing net loss for the period by the weighted average number of shares of common stock outstanding. Diluted net loss per share reflects the additional dilution from potential issuances of common stock, such as stock issuable pursuant to the exercise of stock options or the exercise of outstanding warrants. The treasury stock method and the if-converted method are used to calculate the potential dilutive effect of these common stock equivalents. Potentially dilutive shares are excluded from the computation of diluted net loss per share when their effect is anti-dilutive. In periods where a net loss is presented, all potentially dilutive securities are anti-dilutive and are excluded from the computation of diluted net loss per share. Recent Accounting Pronouncements In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, In August 2018, the FASB issued ASU No. 2018-13, Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement, In January 2017, the FASB issued ASU No. 2017-04, Simplifying the Test for Goodwill Impairment (Topic 350). This standard eliminates Step 2 from the goodwill impairment test, instead requiring an entity to recognize a goodwill impairment charge for the amount by which the goodwill carrying amount exceeds the reporting unit’s fair value. This update also eliminated the qualitative assessment requirements for a reporting unit with zero or negative carrying value. This guidance was effective for interim and annual goodwill impairment tests in fiscal years beginning after December 15, 2019, with early adoption permitted, and must be applied on a prospective basis. The Company adopted the standard in the first quarter of 2020 with no material impact on the Company’s consolidated financial statements. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. The amendments in this update simplify the accounting for income taxes by removing certain exceptions to the general principles in Accounting Standards Codification (“ASC”) Topic 740. The amendments also improve consistent application of and simplify U.S. GAAP for other areas of ASC Topic 740 by clarifying and amending existing guidance. The amendments in this update are effective for interim and annual periods for the Company beginning after December 15, 2020, with early adoption permitted. The Company has evaluated the changes from the standard update and determined any impacts would be immaterial on its consolidated financial statements. The Company will adopt the new guidance on January 1, 2021. |
Liquidity and Going Concern
Liquidity and Going Concern | 12 Months Ended |
Dec. 31, 2020 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Liquidity and Going Concern | 2. Liquidity and Going Concern The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. The Company has negative working capital and recurring losses from operations, recurring negative cash flows from operations and substantial cumulative net losses to date and anticipates that it will continue to do so for the foreseeable future as it continues to identify and invest in advancing product candidates, as well as expanding corporate infrastructure. The Company has plans in place to obtain sufficient additional fundraising to fulfill its operating and capital requirements for the next 12 months. The Company’s plans include continuing to fund its operating losses and capital funding needs through public or private equity or debt financings, strategic collaborations, licensing arrangements, asset sales, government grants or other arrangements. Although management believes such plans, if executed, should provide the Company sufficient financing to meet its needs, successful completion of such plans is dependent on factors outside of the Company’s control. As such, management cannot conclude that such plans will be effectively implemented within one year after the date that the financial statements are issued. As a result, management has concluded that the aforementioned conditions, among others, raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date the financial statements are issued. If the Company is unable to raise additional capital in sufficient amounts or on terms acceptable, the Company may have to significantly delay, scale back or discontinue the development or commercialization of one or more of its product candidates. The Company may also seek collaborators for one or more of its current or future product candidates at an earlier stage than otherwise would be desirable or on terms that are less favorable than might otherwise be available. The consolidated financial statements do not reflect any adjustments that might be necessary if the Company is unable to continue as a going concern. If the Company raises additional funds by issuing equity securities, substantial dilution to existing stockholders would result. If the Company raises additional funds by incurring debt financing, the terms of the debt may involve significant cash payment obligations as well as covenants and specific financial ratios that may restrict the Company’s ability to operate its business. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 3. Fair Value Measurements The following table presents the Company’s financial assets and liabilities that are measured at fair value on a recurring basis (in thousands): Fair Value Measurements at December 31, 2020 Balance Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Cash and cash equivalents $ 56,464 $ 56,464 $ — $ — Total assets $ 56,464 $ 56,464 $ — $ — Liabilities: Derivative liabilities - non-current $ 35,400 $ — $ — $ 35,400 Acquisition consideration payable 398 — — 398 Acquisition consideration payable, non-current 549 — — 549 Total liabilities $ 36,347 $ — $ — $ 36,347 Fair Value Measurements at December 31, 2019 Balance Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Cash and cash equivalents $ 22,521 $ 22,521 $ — $ — Restricted cash 58,248 58,248 — — Total assets $ 80,769 $ 80,769 $ — $ — Liabilities: Derivative liabilities $ 8,800 $ — $ — $ 8,800 Derivative liabilities - non-current 35,000 — — 35,000 Acquisition consideration payable 908 — — 908 Acquisition consideration payable, non-current 39 — — 39 Total liabilities $ 44,747 $ — $ — $ 44,747 There were no changes to the fair value of acquisition consideration payable during the year ended December 31, 2020. During the year ended December 31, 2019, the fair value remeasurement adjustments related to the Company’s acquisitions resulted in a decrease to the contingent consideration liabilities by $0.7 million. The Company also recorded a $10.4 million gain related to the settlement of the acquisition consideration payable associated with the Virttu acquisition. During the year ended December 31, 2018, the fair value remeasurement adjustments related to the Company’s acquisitions resulted in an increase to the contingent consideration liabilities by $9.6 million. The Company recorded $51.9 million in settlements of contingent consideration primarily related to such liabilities, which included the settlements of Scilex Pharmaceuticals Inc. (“Scilex Pharma”) and BDL liabilities for $38.2 million and $2.3 million, respectively, and the $11.3 million partial settlement of the Virttu financing milestone in common stock of the Company. Contingent consideration liabilities and acquisition consideration payable are measured using the income approach and discounting to present value the contingent payments expected to be made based on assessment of the probability that the company would be required to make such future payments. The contingent consideration liabilities and acquisition consideration payable are measured at fair value using significant unobservable inputs (Level 3), which include discount rates and probabilities assigned to scenario outcomes. The following table includes a summary of the changes to contingent consideration liabilities and acquisition consideration payable during the years ended December 31, 2020, 2019 and 2018: (in thousands) Fair Value Balance at December 31, 2017 $ 54,272 Re-measurement of Fair Value 9,644 Settlements of contingent consideration (51,879 ) Balance at December 31, 2018 $ 12,037 Re-measurement of Fair Value (736 ) Settlements of contingent consideration (10,354 ) Balance at December 31, 2019 $ 947 Re-measurement of Fair Value — Settlements of contingent consideration — Balance at December 31, 2020 $ 947 Derivative liabilities The Company recorded a gain on derivative liabilities of $6.6 million and a loss on derivative liabilities of $36.8 million for the years ended December 31, 2020 and 2019, respectively, which related to the compound derivative liabilities associated with the Term Loans and the Scilex Notes (as defined in Note 8 The compound derivative liabilities consist of the fair value of various embedded features as further described in Note 8 . The fair value of the derivative liabilities associated with the Scilex Notes was estimated using the discounted cash flow method under the income approach combined with a Monte Carlo simulation model. This involves significant Level 3 inputs and assumptions. The key assumptions for the Scilex Notes for the year ended December 31, 2020 included a Significant Level 3 inputs and assumptions for derivative liabilities associated with the Term Loans primarily included the estimated probabilities of satisfying certain commercial and financial milestones estimated using a with and without discounted cash flow approach. As explained further in Note 8 During the year ended December 31, 2019, the Company recorded a derivative liability and corresponding debt discount of approximately $7.0 million, which was attributed to a contingent acceleration feature related to the Early Conditional Loan. The debt discount 1.8 Note 8 ) for the year ended December 31, 2019. The following table includes a summary of the derivative liabilities measured at fair value using significant unobservable inputs (Level 3) during the years ended December 31, 2020 and 2019: (in thousands) Fair Value Balance at December 31, 2018 $ — Additions 6,996 Re-measurement of Fair Value 36,804 Balance at December 31, 2019 $ 43,800 Additions 8,800 Re-measurement of Fair Value (17,200 ) Balance at December 31, 2020 $ 35,400 |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2020 | |
Property Plant And Equipment [Abstract] | |
Property and Equipment | 4. Property and Equipment Property and equipment consisted of the following as of December 31, 2020 and 2019 (in thousands): December 31, 2020 2019 Furniture and fixtures $ 1,349 $ 1,315 Office equipment 280 700 Machinery and lab equipment 41,919 33,192 Leasehold improvements 14,295 13,161 Construction in progress 4,031 3,855 61,874 52,223 Less accumulated depreciation (30,013 ) (22,335 ) $ 31,861 $ 29,888 Depreciation expense for the years ended December 31, 2020, 2019 and 2018 was $7.0 million, $7.0 million and $6.0 million, respectively. |
Investments
Investments | 12 Months Ended |
Dec. 31, 2020 | |
Equity Method Investments And Joint Ventures [Abstract] | |
Investments | 5. Investments The Company’s equity method investments include an ownership interest in Immunotherapy NANTibody, LLC (“NANTibody”), NantCancerStemCell, LLC (“NantStem”) and ImmuneOncia Therapeutics, LLC, among others. The Company’s other equity investments include an ownership interest in ImmunityBio, Inc., NantBioScience, Inc. (“NantBioScience”), and Celularity Inc. During the year ended December 31, 2020, the Company recorded an impairment loss of approximately $3.8 million related to an equity method investment for which the Company determined the investment’s value is no longer supportable. The loss is included within loss on equity method investments in the Company’s consolidated statement of operations. NANTibody The Company’s investment in NANTibody is reported in equity method investments on its consolidated balance sheets and its share of NANTibody’s income or loss is recorded in loss on equity method investments on its consolidated statement of operations. The Company continues to hold 40% of the outstanding equity of NANTibody and NantCell holds the remaining 60%. The carrying value of the Company’s investment in NANTibody was approximately $0.5 million and $2.5 million as of December 31, 2020 and 2019, respectively. NANTibody recorded net loss of $0.1 million, $2.4 million and $0.7 million for the twelve months ended September 30, 2020, 2019 and 2018, respectively. As of September 30, 2020, NANTibody had $4.9 million in current assets, $3.5 million in current liabilities, $0.2 million in noncurrent assets and no noncurrent liabilities. As of September 30, 2019, NANTibody had $7.3 million in current assets, $1.0 million in current liabilities, $0.2 in noncurrent assets and no noncurrent liabilities. The financial statements of NANTibody are not received sufficiently timely for the Company to record its portion of earnings or loss in the current financial statements and therefore the Company reports its portion of earnings or loss on a one quarter lag. NantStem The Company’s investment in NantStem is reported in equity method investments on its consolidated balance sheets and its share of NantStem’s income or loss is recorded in loss on equity method investments on its consolidated statement of operations. The Company is accounting for its interest in NantStem as an equity method investment, due to the significant influence the Company has over the operations of NantStem through its board representation and 20% voting interest. The carrying value of the Company’s investment in NantStem was approximately $18.1 million and $17.9 million as of December 31, 2020 and 2019, respectively. NantStem recorded a net gain of $0.1 million and net loss of $0.9 million for the twelve months ended September 30, 2020 and 2019, respectively. As of September 30, 2020, NantStem had $80.0 million in current assets, no current liabilities and $1.7 million noncurrent assets and no noncurrent liabilities. As of September 30, 2019, NantStem had $75.9 million in current assets, $0.2 million in current liabilities, $4.7 million in noncurrent assets and no noncurrent liabilities. A loss related to other-than-temporary impairment of $0.5 million was recognized for the equity investment in NantStem for the year ended December 31, 2018. The financial statements of NantStem are not received sufficiently timely for the Company to record its portion of earnings or loss in the current financial statements and therefore the Company reports its portion of earnings or loss on a one quarter lag. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | 6. Goodwill and Intangible Assets The Company had goodwill of $43.6 million as of December 31, 2020, which increased by $5.3 million as compared to $38.3 million as of December 31, 2019 due to the Company’s acquisition of SmartPharm. The Company performed a qualitative test for goodwill impairment by segment during the fourth quarter of 2020. No goodwill impairment was recognized for the years ended December 31, 2020, 2019 and 2018. Commencing January 1, 2019, the Company re-segmented its business into two new operating segments: the Sorrento Therapeutics segment and the Scilex segment. These segments are the Company’s reporting units and are the level at which the Company conducts its goodwill impairment evaluations. Goodwill was allocated to the Sorrento Therapeutics and the Scilex operating segments on a relative fair value basis. Goodwill for the Sorrento Therapeutics segment and Scilex segment was $36.9 million and $6.7 million, respectively, as of December 31, 2020. Amortization for the intangible assets that have finite useful lives is generally recorded on a straight-line basis over their useful lives. Intangible assets with indefinite useful lives totaling $28.3 million are included in acquired in-process research and development in the table below. A summary of the Company’s identifiable intangible assets as of December 31, 2020 and 2019 is as follows (in thousands): December 31, 2020 Weighted Average Amortization Period (Years) Gross Carrying Amount Accumulated Amortization Intangibles, net Customer relationships 6 $ 1,585 $ 1,426 $ 159 Acquired technology 19 3,410 1,236 2,174 Acquired in-process research and development — 28,260 — 28,260 Technology placed in service 15 21,940 3,291 18,649 Patent rights 15 32,720 9,103 23,617 Assembled workforce 5 605 222 383 Internally developed software 1 520 87 433 Total intangible assets $ 89,040 $ 15,365 $ 73,675 December 31, 2019 Weighted Average Amortization Period (Years) Gross Carrying Amount Accumulated Amortization Intangibles, net Customer relationships 6 $ 1,585 $ 1,401 $ 184 Acquired technology 19 3,410 1,060 2,350 Acquired in-process research and development — 14,360 — 14,360 Technology placed in service 15 21,940 1,828 20,112 Patent rights 15 32,720 6,922 25,798 Assembled workforce 5 605 101 504 Total intangible assets $ 74,620 $ 11,312 $ 63,308 As of December 31, 2020, the remaining weighted average life for identifiable intangible assets is 10 years. Aggregate amortization expense was $4.1 million and $3.9 million for the year ended December 31, 2020 and 2019, respectively. The Company recorded an impairment charge of $1.8 million associated with acquired in-process research and development during the year ended December 31, 2018. The Company commenced amortization of acquired in-process research and development related to the business combination of Scilex Pharma upon commercialization of ZTlido in October 2018. Such amount is being amortized as technology placed in service. Estimated future amortization expense related to intangible assets, excluding indefinite-lived intangible assets, at December 31, 2020 is as follows (in thousands): Years Ending December 31, Amount 2021 $ 4,400 2022 3,966 2023 3,961 2024 3,870 2025 3,845 Thereafter 25,373 Total $ 45,415 |
Significant Agreements and Cont
Significant Agreements and Contracts | 12 Months Ended |
Dec. 31, 2020 | |
Significant Agreements And Contracts [Abstract] | |
Significant Agreements and Contracts | 7. Significant Agreements and Contracts 2020 Acquisition Acquisition of SmartPharm Therapeutics, Inc. On September 1, 2020, the Company completed the acquisition of SmartPharm, a gene-encoded protein therapeutics company developing non-viral DNA and RNA gene delivery platforms for COVID-19, Influenza and rare diseases with broad potential for application in enhancing antibody-centric therapeutics. The total base consideration paid to the holders of capital stock of SmartPharm in the acquisition was $19.5 million, which was comprised of approximately 1.8 million shares of the Company’s common stock. The purchase price allocation resulted in net identifiable assets of $19.5 million, which includes separate and distinct indefinite lived intangible assets comprised of acquired in-process research and development of $13.9 million, goodwill of $5.3 million and other net assets of $0.3 million. Customary tax related matters such as the filing of pre-acquisition tax returns are subject to finalization as of December 31, 2020. Such matters may result in adjustments to the purchase price allocation. 2019 Acquisition Acquisition of Semnur Pharmaceuticals, Inc. ( “ ” On March 18, 2019, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Semnur Pharmaceuticals, Inc. (“Semnur”) and Scilex Holding, whereby Semnur became a wholly-owned subsidiary of Scilex Holding (the “Merger”), and thereby Scilex Holding acquired Semnur’s SEMDEXA TM Pursuant to the Merger Agreement, Scilex Holding also agreed to pay the holders of Semnur’s capital stock and options (the “Semnur Equityholders”) up to $280.0 million in aggregate contingent cash consideration based on the achievement of certain milestones, which is comprised of a $40.0 million payment that will be due upon obtaining the first approval of a New Drug Application of a Semnur product by the U.S. Food and Drug Administration (the “FDA”) and additional payments that will be due upon the achievement of certain amounts of net sales of Semnur products as follows: (a) a $20.0 million payment upon the achievement of $100.0 million in cumulative net sales of a Semnur product, (b) a $20.0 million payment upon the achievement of $250.0 million in cumulative net sales of a Semnur product, (c) a $50.0 million payment upon the achievement of $500.0 million in cumulative net sales of a Semnur product, and (d) a $150.0 million payment upon the achievement of $750.0 million in cumulative net sales of a Semnur product. In March 2019, the Company also entered into an Exchange and Registration Rights Agreement (the “Exchange Agreement”) with the Semnur Equityholders. Pursuant to the Exchange Agreement, if within 18 months of the closing of the Merger, 100% of the outstanding equity of Scilex Holding had not been acquired by a third party or Scilex Holding had not entered into a definitive agreement with respect to, or otherwise consummated, a firmly underwritten offering of Scilex Holding’s capital stock that meets certain requirements and includes the Stock Consideration, then the Semnur Equityholders could collectively elect to exchange, during the 60-day period commencing the date that is the 18 month anniversary of the closing of the Merger, the Stock Consideration for shares of the Company’s common stock with a value of $55.0 million (the “Semnur Share Exchange”) based on a price per share of the Company’s common stock equal to the greater of (a) the 30-day trailing volume weighted average price of one share of the Company’s common stock as reported on the Nasdaq Capital Market as of the consummation of the Semnur Share Exchange and (b) $5.55 (subject to adjustment for any stock dividend, stock split, stock combination, reclassification or similar transaction) (the “Exchange Price”). On September 28, 2020, the Company entered into an amendment to the Exchange Agreement to, among other things, provide that if the Company received notice from that they will proceed with the Semnur Share Exchange (the “Exchange Notice”), the Company could, in its sole discretion, elect, within seven days of receipt of the Exchange Notice, to exchange all the Stock Consideration and the rights to receive cash from Scilex Holding held by the Semnur Equityholders for an amount in cash equal to $55.0 million, in lieu of issuing $55.0 million of shares of the Company’s common stock at the Exchange Price On September 28, 2020, the Semnur Equityholders delivered the Exchange Notice to the Company. On October 5, 2020, the Company notified the Semnur Equityholders of its election to pay cash, and paid $55.0 million in cash to the Semnur Equityholders and effectuated the Semnur Share Exchange on October 9, 2020. The transaction was accounted for as an asset acquisition since substantially all the value of the gross assets was concentrated in a single asset. No contingent consideration was recorded as of December 31, 2019 and 2020 since the related regulatory approval milestones are not deemed probable until they actually occur. Approximately $75.3 million was expensed as acquired in-process research and development during the year ended December 31, 2019. 2018 Acquisition Acquisition of Sofusa ® In July 2018, the Company acquired Kimberly-Clark’s Sofusa® micro-needle drug delivery system platform (the “Sofusa Acquisition”). At the closing of the Sofusa Acquisition, the Company paid $10.0 million and agreed to pay additional consideration to Kimberly-Clark upon the achievement of certain regulatory and net sales milestones, as well as a percentage in the low double-digits of any non-royalty amounts received by the Company in connection with any license, sale or other grant of rights by the Company to develop or commercialize the Sofusa Assets (the “Sofusa Contingent Consideration”). Under the Sofusa Purchase Agreement, the aggregate amount of the Sofusa Contingent Consideration payable by the Company will not exceed $300.0 million. The Company also agreed to pay Kimberly-Clark a low single-digit royalty on all net sales with respect to the first five products developed by the Company or its licensees that utilizes intellectual property included in the Sofusa Assets. The transaction was accounted for as an asset acquisition since substantially all the value of the gross assets was concentrated in a single asset. No contingent consideration was recorded as of December 31, 2020 since the related regulatory approval milestones are not deemed probable until they actually occur. As a result, $9.5 million was expensed as acquired in-process research and development and the remaining $0.5 million was recorded primarily to fixed assets. License Agreements License Agreement with ACEA Therapeutics, Inc. In July 2020, the Company entered into a License Agreement (the “ACEA License Agreement”) with ACEA Therapeutics, Inc. (“ACEA”). Pursuant to the ACEA License Agreement, ACEA granted the Company an exclusive license and right under certain patents and certain know-how and other intellectual property (“Licensed Know-How”) to fully utilize, exploit and commercialize (i) the Licensed Know-How, (ii) Abivertinib (AC0010), a selective, orally available irreversible small molecule tyrosine kinase inhibitor to Bruton’s tyrosine kinase and mutant epidermal growth factor receptor, including any improvements thereto, and (iii) (a) any composition, product, or component part thereof, and (b) any and all services offered in connection or associated therewith, in all fields of use, including the diagnosis, treatment and/or cure of any human disease or disorder worldwide, other than the People’s Republic of China. As consideration for the license under the ACEA License Agreement, the Company paid ACEA an up-front license fee of $15.0 million in cash, which was expensed as acquired in-process research and development during the year ended December 31, 2020. The Company also agreed to pay ACEA (i) certain milestone payments upon the receipt of certain regulatory approvals, and (ii) certain milestone payments upon the Company’s or its affiliates’ achievement of certain commercial sales milestones. The milestone payments may be comprised of cash or any combination of cash and common stock of the Company, in any case as determined by the Company so long as no more than 50% of any upfront payment or milestone payment is comprised of common stock. The Company will also pay certain royalties in the mid-single digit to low-double digit percentages of annual net sales by the Company. License Agreement with The Trustees of Columbia University in the City of New York In July 2020, the Company entered into an Exclusive License Agreement (the “Columbia License Agreement”) with The Trustees of Columbia University in the City of New York (“Columbia”). Pursuant to the Columbia License Agreement, Columbia granted the Company (i) an exclusive license under certain patents, other intellectual property and materials to discover, develop, commercialize and exploit certain products and services (“Products”) in all diagnostic applications of high-performance loop-mediated isothermal amplification (“HP-LAMP”) for coronaviruses and influenza viruses (the “Field”) worldwide, subject to certain limitations. Pursuant to the Columbia License Agreement, Columbia also granted to the Company an option, exercisable for twelve months from the effective date of the Columbia License Agreement and subject to the satisfaction of certain conditions, to acquire an exclusive worldwide license to such patents, other intellectual property and materials for additional diagnostic application(s) of HP-LAMP (other than for coronaviruses and influenza viruses), subject to certain limitations. As consideration for the license under the Columbia License Agreement, the Company paid Columbia an up-front license fee of $5.0 million in cash, which was expensed as acquired in-process research and development during the year ended December 31, 2020. The Company also agreed to pay Columbia (i) an earned royalty on the net sales of Products in the Field worldwide, and (ii) minimum annual royalty payments of $1.0 million no later than ten days following the first bona fide commercial sale of a Product to a third-party customer and on an annual basis thereafter. In addition, the Company agreed to pay Columbia a percentage of certain non-royalty sublicense revenue and other payments received by the Company from its sublicensees as consideration for the grant of any sublicense, option or similar rights. Pursuant to the Columbia License Agreement, the Company also agreed to pay certain one-time, development milestone payments to Columbia upon the receipt of certain regulatory approvals or the first commercial sale of certain Products for diagnostic applications within the Field. License Agreement with Mayo Foundation In September 2020, the Company entered into a patent and know-how license agreement (the “Mayo License Agreement”) with Mayo Foundation for Medical Education and Research (“Mayo”). Pursuant to the Mayo License Agreement, Mayo granted the Company a sublicensable license under certain of Mayo’s patents, know-how, and materials relating to targeted nanoparticle therapies (“Patent Rights”, “Know-How”, and “Materials”, respectively) to reproduce, use, commercialize, and exploit related products, processes and services (“Licensed Products”) for the prevention, diagnosis and/or treatment of human diseases and conditions worldwide. As consideration for the license under the Mayo License Agreement, the Company paid Mayo an upfront license fee of $9.3 million comprised of approximately $2.3 million in cash and 996,803 shares of the Company’s common stock, which was expensed as acquired in-process research and development during the year ended December 31, 2020. The Company also agreed to (i) reimburse Mayo up to $3.4 million for preclinical and clinical research expenses associated with the Know-How, Patent Rights and Materials arising prior to the entry into the Mayo License Agreement, and (ii) reimburse Mayo approximately $2.0 million for expenses related to the development and manufacturing of the Materials arising prior to the entry into the Mayo License Agreement. Such reimbursements were paid and expensed as acquired in-process research and development during the year ended December 31, 2020. The Company also agreed to pay Mayo (i) certain milestone payments upon the initiation of certain clinical trials, (ii) certain milestone payments upon the receipt of certain regulatory approvals, and (iii) certain milestone payments upon the achievement of certain commercial sales milestones. The Company will also pay certain royalties in the low-single digit to mid-single digit percentages of annual net sales of Licensed Products by the Company and a share of any sublicense revenue received by the Company from sublicensees. License Agreement with Personalized Stem Cells, Inc. In October 2020, the Company entered into a license agreement (the “License Agreement”) with Personalized Stem Cells, Inc. (“PSC”). Pursuant to the License Agreement, PSC granted the Company an exclusive license and right under certain patents, certain know-how and other intellectual property to fully utilize, exploit and commercialize certain products and services using allogeneic adipose-derived stem cells for or in respect of human health, including the diagnosis and treatment and/or cure of any human disease or disorder (excluding commercial sales for the diagnosis, treatment and/or cure of SARS-CoV-2 or other respiratory diseases in the People’s Republic of China) worldwide (excluding the People’s Republic of China for products directed at COVID-19 or other respiratory diseases). PSC also agreed to transfer certain cell lines composed of stromal vascular cells, master cell banks and finished final drug lots (the “Product Materials”) to the Company. The Company agreed to grant PSC rights to use data derived by the Company from a certain Phase I COVID-19 study for PSC’s own programs that are not competitive with the businesses or activities of the Company, and for PSC to sublicense such data to third parties for research, development and regulatory purposes. As consideration for the license under the License Agreement, the Company paid PSC an upfront license fee of $3.5 million in cash, which was expensed as acquired in-process research and development during the year ended December 31, 2020. The Company also agreed to pay PSC (i) a milestone payment upon the issuance of a regulatory approval, and (ii) certain milestone payments upon PSC’s manufacture and delivery of the Product Materials to the Company. The Company will also pay royalties in the low-single digit percentages of annual net sales of licensed products and services by the Company and a share of any sublicense revenue received by the Company from sublicensees. License Agreement with NantCell In April 2015, the Company and NantCell entered into a license agreement. Under the terms of the agreement, the Company granted an exclusive license to NantCell covering patent rights, know-how, and materials related to certain antibodies, ADCs and two CAR-TNK products. NantCell agreed to pay a royalty not to exceed five percent (5%) to the Company on any net sales of products (as defined) from the assets licensed by the Company to NantCell. In addition to the future royalties payable under this agreement, NantCell paid an upfront payment of $10.0 million to the Company and issued 10 million shares of NantCell common stock to the Company valued at $100.0 million based on a recent equity sale of NantCell common stock to a third party. The Company terminated the agreement, effective January 29, 2020, due to NantCell`s material breach of the agreement. The termination and remedies related to such termination are currently pending in an arbitration before the American Arbitration Association. The Company has therefore deferred recognition of the upfront payment and the value of the equity interest received until the arbitration is concluded or resolved. The Company’s ownership interest in NantCell does not provide the Company with control or the ability to exercise significant influence; therefore the $100.0 million investment is carried at cost in the consolidated balance sheets and evaluated for other-than-temporary impairment on a quarterly basis. Short-term working capital funding arrangements In November 2019, the Company entered into short-term working capital funding arrangements (the “Arrangements”) in which the Company received proceeds of approximately $8.0 million, for a fee of 5% per annum. Additionally, the Company provided security deposits in an aggregate amount of approximately $8.5 million (RMB 60.0 million). During the fiscal year ended December 31, 2020, the Company repaid $8.0 million of the Arrangements in full, including fees, which was included in the current portion of debt. |
Debt
Debt | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Debt | 8. Debt 2018 Purchase Agreements and Indenture for Scilex On September 7, 2018, Scilex Pharma entered into Purchase Agreements (the “2018 Purchase Agreements”) with certain investors (collectively, the “Scilex Note Purchasers”) and the Company. Pursuant to the 2018 Purchase Agreements, on September 7, 2018, Scilex Pharma, among other things, issued and sold to the Scilex Note Purchasers senior secured notes due 2026 in an aggregate principal amount of $224,000,000 (the "Scilex Notes") for an aggregate purchase price of $140,000,000 million (the “Scilex Notes Offering”). In connection with the Scilex Notes Offering, Scilex Pharma also entered into an Indenture (the “Indenture”) governing the Scilex Notes with U.S. Bank National Association, a national banking association, as trustee (the “Trustee”) and collateral agent (the “Collateral Agent”), and the Company. Pursuant to the Indenture, the Company agreed to irrevocably and unconditionally guarantee, on a senior unsecured basis, the punctual performance and payment when due of all obligations of Scilex Pharma under the Indenture (the "Guarantee"). The net proceeds of the Offering were approximately $89.3 million, after deducting the Offering expenses payable by Scilex Pharma and funding a segregated reserve account ($20.0 million) (the “Reserve Account”) and a segregated collateral account ($25.0 million) (the “Collateral Account”) pursuant to the terms of the Indenture. Funds in the Reserve Account were to be released to Scilex Pharma upon receipt by the Trustee of an officer’s certificate under the Indenture from Scilex Pharma confirming receipt of a marketing approval letter from the FDA with respect to SP-103 (the “Marketing Approval Letter”) on or prior to July 1, 2023. Funds in the Collateral Account were to be released upon receipt of a written consent authorizing such release from the holders of a majority in principal amount of the Scilex Notes issued, upon the occurrence and during the continuance of an event of default at the direction of the holders of a majority in principal amount of the Scilex Notes issued or upon the repayment in full of all amounts owed under the Scilex Notes. The holders of the Scilex Notes are entitled to receive quarterly payments of principal of the Scilex Notes equal to a percentage, in the range of 10% to 20% of the net sales of ZTlido for the prior fiscal quarter, beginning on February 15, 2019. If Scilex Pharma has not received the Marketing Approval Letter by March 31, 2021, the percentage of net sales payable shall be increased to be in the range of 15% to 25%. If actual cumulative net sales of ZTlido from October 1, 2022 through September 30, 2023 are less than 60% of a predetermined target sales threshold for such period, then Scilex Pharma will be obligated to pay an additional installment of principal of the Scilex Notes each quarter in an amount equal to an amount to be determined by reference to the amount of such deficiency. The aggregate principal amount due under the Scilex Notes shall be increased by $28,000,000 on February 15, 2022 if actual cumulative net sales of ZTlido from the issue date of the Scilex Notes through December 31, 2021 do not equal or exceed 95% of a predetermined target sales threshold for such period. If actual cumulative net sales of ZTlido for the period from October 1, 2022 through September 30, 2023 do not equal or exceed 80% of a predetermined target sales threshold for such period, the aggregate principal amount shall also be increased on November 15, 2023 by an amount equal to an amount to be determined by reference to the amount of such deficiency. The final maturity date of the Scilex Notes will be August 15, 2026. The Scilex Notes may be redeemed in whole at any time upon 30 days’ written notice at Scilex Pharma’s option prior to August 15, 2026 at a redemption price equal to 100% of the then-outstanding principal amount of the Scilex Notes. In addition, upon a change of control of Scilex Pharma (as defined in the Indenture), each holder of a Scilex Note shall have the right to require Scilex Pharma to repurchase all or any part of such holder’s Scilex Note at a repurchase price in cash equal to 101% of the then-outstanding principal amount thereof. The Indenture governing the Scilex Notes contains customary events of default with respect to the Scilex Notes (including a failure to make any payment of principal on the Scilex Notes when due and payable), and, upon certain events of default occurring and continuing, the Trustee by notice to Scilex Pharma, or the holders of at least 25% in principal amount of the outstanding Scilex Notes by notice to Scilex Pharma and the Trustee, may (subject to the provisions of the Indenture) declare 100% of the then-outstanding principal amount of the Scilex Notes to be due and payable. Upon such a declaration of acceleration, such principal will be due and payable immediately. In the case of certain events, including bankruptcy, insolvency or reorganization involving the Company or Scilex Pharma, the Scilex Notes will automatically become due and payable. Pursuant to the Indenture, the Company and Scilex Pharma must also comply with certain covenants with respect to the commercialization of ZTlido, as well as customary additional affirmative covenants, such as furnishing financial statements to the holders of the Scilex Notes, minimum cash requirements and net sales reports; and negative covenants, including limitations on the following: the incurrence of debt; the payment of dividends, the repurchase of shares and under certain conditions making certain other restricted payments; the prepayment, redemption or repurchase of subordinated debt; a merger, amalgamation or consolidation involving Scilex Pharma; engaging in certain transactions with affiliates; and the making of investments other than those permitted by the Indenture. Pursuant to a Collateral Agreement by and among Scilex Pharma, the Trustee and the Collateral Agent (the “Collateral Agreement”), the Scilex Notes will be secured by ZTlido and all of the existing and future property and assets of Scilex Pharma necessary for, or otherwise relevant to, now or in the future, the manufacture and sale of ZTlido, on a worldwide basis (exclusive of Japan), including, but not limited to, the intellectual property related to ZTlido, the marketing or similar regulatory approvals related to ZTlido, any licenses, agreements and other contracts related to ZTlido, and the current assets related to ZTlido such as inventory, accounts receivable and cash and any and all future iterations, improvements or modifications of such product made, developed or licensed (or sub-licensed) by Scilex Pharma or any of its affiliates or licensees (or sub-licensees) (including SP-103). Pursuant to the terms of the Indenture, the Company issued an irrevocable standby letter of credit to Scilex Pharma (the “Letter of Credit”), which provides that, in the event that (1) Scilex Pharma does not hold at least $35,000,000 in unrestricted cash (which is inclusive of the amount in the Collateral Account) as of the end of any calendar month during the term of the Scilex Notes, (2) actual cumulative net sales of ZTlido from the issue date of the Scilex Notes through December 31, 2021 are less than a specified sales threshold for such period, or (3) actual cumulative net sales of ZTlido for any calendar year during the term of the Scilex Notes, beginning with the 2022 calendar year, are less than a specified sales threshold for such calendar year, Scilex Pharma as beneficiary of the Letter of Credit, will draw, and the Company will pay to Scilex Pharma, $35,000,000 in a single lump-sum amount as a subordinated loan. In the event that Scilex Pharma draws on, and the Company pays to Scilex Pharma, $35,000,000 in a single lump-sum amount as a subordinated loan, each holder of the Scilex Notes had the right to require the Company to purchase all or any part of such holder’s outstanding Scilex Notes in the principal amount of, and at a purchase price in cash equal to, $25,000,000 multiplied by such holder’s pro rata portion of the then-outstanding Scilex Notes. The Letter of Credit will terminate upon the earliest to occur of: (a) the repayment of the Scilex Notes in full, (b) the actual net sales of ZTlido for any calendar year during the term of the Scilex Notes exceeding a certain threshold, (c) the consummation of an initial public offering on a major international stock exchange by Scilex Pharma that satisfies certain valuation thresholds, and (d) the replacement of the Letter of Credit with another letter of credit in form and substance, including as to the identity and creditworthiness of issuer, reasonably acceptable to the holders of at least 80% in principal amount of outstanding Scilex Notes. On December 14, 2020, Scilex Pharma, the Company, the Trustee and the Agent, and the beneficial owners of the Scilex Notes and the Scilex Note Purchasers entered into a Consent Under and Amendment No. 3 to Indenture and Letter of Credit (the “Amendment”), which amended: (i) the Indenture, and (ii) the Letter of Credit. Pursuant to the Amendment, the Scilex Note Purchasers agreed to release all of the aggregate $45.0 million in restricted funds held in the Reserve Account and the Collateral Account for the purpose of consummating the repurchase of an aggregate of $45.0 million of principal amount of the Securities from the Holders on a pro rata basis at a purchase price equal to 100% of the principal amount thereof (such repurchase, the “Effective Date Repurchase”). In connection with the Effective Date Repurchase, the parties also agreed to remove Scilex Pharma ’s obligations under the Indenture to (i) repurchase $ 25.0 million of Securities from the holders if the Letter of Credit is drawn on, and (ii) repurchase $ 20.0 million of Securities from the holders if Scilex Pharma does not receive the Marketing Approval Letter on or prior to July 1, 2023. The Amendment also revised the minimum cash covenant in the Indenture to provide that the amount of cash equivalents in bank accounts that Scilex Pharma is required to have as of the end of any calendar month shall, commencing with the month ending December 31, 2020, be equal to at least $4.0 million in the aggregate, provided that if Scilex Pharma does not effectuate (i) the December Optional Repurchase (as defined below) and (ii) at least one of either (x) the February Optional Repurchase (as defined below) or (y) the April Optional Repurchase (as defined below), then, commencing with the month ending April 30, 2021, and for each month thereafter, such amount shall be at least $10.0 million in the aggregate. If Scilex Pharma fails to meet the foregoing minimum cash requirements, then Scilex Pharma will be required to draw on the Letter of Credit. The Amendment also provides Scilex Pharma with the option, in its sole and absolute discretion, to repurchase Securities from the holders thereof on a pro rata basis on each of December 16, 2020 (the “December Optional Repurchase”), February 12, 2021 (the “February Optional Repurchase”) and April 13, 2021 (the “April Optional Repurchase” and, together with the December Optional Repurchase and the February Optional Repurchase, the “Optional Repurchases”), in each case in an aggregate amount equal to the lesser of $20.0 million or the then-outstanding principal amount of Securities, at a purchase price in cash equal to 100% of the principal amount thereof. The Amendment further provides that in the event that the Letter of Credit is drawn upon by Scilex Pharma, then Scilex Pharma shall, within five business days of such draw, repurchase Securities from the holders thereof on a pro rata basis in an aggregate amount equal to the lesser of $20.0 million or the then-outstanding principal amount of Securities, at a purchase price in cash equal to 100% of the principal amount thereof. Pursuant to the Amendment, the Holders also consented to Scilex Pharma incurring up to $10.0 million of indebtedness in connection with an accounts receivable revolving loan facility with another lender and the incurrence of liens and the pledge of collateral to such lender in connection therewith. On December 14, 2020, the restricted funds in the Reserve Account and the Collateral Account were released and the Effective Date Repurchase was effected. Scilex Pharma also effectuated the December Optional Repurchase on December 16, 2020. Following the Effective Date Repurchase and the December Optional Repurchase, the aggregate principal amount of the Scilex Notes was reduced by an aggregate of $65.0 million. The Company accounted for the Amendment as a debt modification under ASC Topic 470-50 as the modified terms were not substantially different than the pre-modified terms. On February 12, 2021, Scilex Pharma effectuated the February Optional Repurchase, which reduced the aggregate principal amount of the Scilex Notes by $20.0 million. To estimate the fair value of the Scilex Notes, the Company uses the discounted cash flow method under the income approach, which involves significant Level 3 inputs and assumptions, combined with a Monte Carlo simulation as appropriate. The value of the debt instrument is based on the present value of future principal payments and the discounted rate of return reflective of the Company’s credit risk. Borrowings of the Scilex Notes consisted of the following (in thousands): December 31, 2020 2019 Principal $ 151,872 $ 221,666 Unamortized debt discount (51,022 ) (67,839 ) Unamortized debt issuance costs (3,698 ) (4,360 ) Carrying value $ 97,152 $ 149,467 Estimated fair value $ 122,300 $ 150,800 Future minimum payments under the Scilex Notes, based on a percentage of projected net sales of ZTlido are estimated as follows (in thousands): Year Ending December 31, 2021 $ 4,882 2022 5,535 2023 7,233 2024 8,830 2025 10,142 Thereafter 115,250 Total future minimum payments 151,872 Unamortized debt discount (51,022 ) Unamortized capitalized debt issuance costs (3,698 ) Total Scilex Notes 97,152 Current portion (4,881 ) Long-term portion of Scilex Notes $ 92,271 The Company made principal payments of $69.8 million and $2.3 million during the fiscal years ended December 31, 2020 and 2019, respectively. Debt discount and debt issuance costs, which are presented as a direct reduction of the Scilex Notes in the consolidated balance sheets, are amortized as interest expense using the effective interest method. As principal repayments on the Scilex Notes are based on a percentage of net sales of ZTlido and SP-103, if the Marketing Approval Letter is received, the Company has elected to account for changes in estimated cash flows from future net sales prospectively. Specifically, a new effective interest rate will be determined based on revised estimates of remaining cash flows and changes in expected cash flows will be recognized prospectively. The imputed effective interest rate at December 31, 2020 was 9.15%. The amount of debt discount and debt issuance costs included in interest expense for the fiscal years ended December 31, 2020, 2019 and 2018 was approximately $10.6 million, $15.0 million and $6.8 million, respectively. The Company identified a number of embedded derivatives that require bifurcation from the Scilex Notes and that were separately accounted for in the consolidated financial statements as derivative liabilities. Certain of these embedded features include default interest provisions, contingent rate increases, contingent put options, optional and automatic acceleration provisions and tax indemnification obligations. The fair value of the derivative liabilities associated with the Scilex Notes was estimated using the discounted cash flow method under the income approach combined with a Monte Carlo simulation model. This involves significant Level 3 inputs and assumptions, including a risk adjusted net sales forecast, an effective debt yield, estimated marketing approval probabilities for SP-103 and an estimated probability of an initial public offering by Scilex Holding that satisfies certain valuation thresholds and timing considerations. The Company re-evaluates this assessment each reporting period. The 2018 Purchase Agreements and Indenture, as amended, provide that, upon the occurrence of an event of default, the lenders thereunder may, by written notice to the Company, declare all of the outstanding principal and interest under the Indenture immediately due and payable. For purposes of the Indenture, an event of default includes, among other things, (i) a failure to pay any amounts when due under the Indenture, (ii) a breach or other failure to comply with the covenants (including financial, notice and reporting covenants) under the Indenture, (iii) a failure to make any payment on, or other event triggering an acceleration under, other material indebtedness of the Company, and (iv) the occurrence of certain insolvency or bankruptcy events (both voluntary and involuntary) involving the Company or certain of its subsidiaries. The Company is subject to certain customary default clauses under the Indenture and is in compliance with event of default clauses under the Indenture. 2018 Oaktree Term Loan Agreement In November 2018, the Company entered into a Term Loan Agreement (the “Loan Agreement”) with certain funds and accounts managed by Oaktree Capital Management, L.P. (collectively, the “Lenders”) and Oaktree Fund Administration, LLC, as administrative and collateral agent, for an initial term loan of $100.0 million (the “Initial Loan”). In May 2019, the Company entered into an amendment to the Loan Agreement, under which terms the Lenders agreed to make available to the Company $20.0 million (the “Early Conditional Loan”, and collectively, with the Initial Loan, the “Term Loans”). The Initial Loan matured on November 7, 2023 and bore interest at a rate equal to the London Interbank Offered Rate plus the applicable margin, or 7%. In connection with the Loan Agreement, on November 7, 2018, the Company issued to the Lenders warrants to purchase 6,288,985 shares of the Company’s common stock (the “Initial Warrants”). The Initial Warrants have an exercise price per share of $3.28 and will be exercisable from May 7, 2019 through May 7, 2029. In connection with the May 2019 amendment, the Company issued to the Lenders warrants to purchase an aggregate of 1,333,304 shares of the Company’s common stock (the “2019 Warrants”). The Company recorded a loss on derivative liabilities associated with the 2019 Warrants of $4.3 million on the issuance date. During the year ended December 31, 2020, the Company repaid $120.0 million of outstanding principal under the Term Loans plus approximately $9.4 million of related prepayment premium, exit fees and accrued interest thereon. In connection with the repayment of outstanding principal, the Company recorded a loss on debt settlement of $51.9 million. Interest expense recognized for stated interest on the Term Loans totaled $3.0 million and $10.7 million and $1.4 million for the years ended December 31, 2020, 2019 and 2018, respectively. Debt discount and debt issuance costs were amortized as interest expense using the effective interest method. The amount of debt discount and debt issuance costs included in interest expense on the Term Loans for the years ended December 31, 2020, 2019 and 2018 was approximately $2.2 million $5.5 million and $0.5 million, respectively. 2018 Securities Purchase Agreement for Private Placement In March 2018, the Company entered into a Securities Purchase Agreement (the “March 2018 Securities Purchase Agreement”) with certain investors (the “March 2018 Purchasers”), in which the Company issued and sold to the March 2018 Purchasers, (1) convertible promissory notes in an aggregate principal amount of $120,500,000 (the “Notes”), and (2) warrants to purchase 8,591,794 shares of the Company’s common stock (the “Warrants”). In June 2018, the Company entered into an amendment (the “June 2018 Amendment”), in which the Company issued and sold to the March 2018 Purchasers, (1) Notes in an aggregate principal amount of $37,848,750, and (2) Warrants to purchase an aggregate of 2,698,662 shares of the Company’s common stock. In November 2019, the March 2018 Purchasers agreed to convert the full principal amount, plus all accrued interest into shares of the Company’s common stock. The Company accounted for the conversion as an induced conversion of debt and recorded a loss on settlement of debt of $27.8 million. |
Shareholder's Equity
Shareholder's Equity | 12 Months Ended |
Dec. 31, 2020 | |
Equity [Abstract] | |
Shareholder's Equity | 9. Stockholders’ Equity Amended Sales Agreement On December 4, 2020, Sorrento Therapeutics, Inc. (the “Company”) entered into Amendment No. 1 to the Sales Agreement dated April 27, 2020, by and between the Company and A.G.P./Alliance Global Partners (the “Agent”). The Sales Agreement provided that the Company could offer and sell through or to the Agent up to $250.0 million in shares of its common stock. The Amendment amends the Sales Agreement to provide that the Company may offer and sell, from time to time, through or to the Agent, up to an additional $450.0 million in shares of the Company’s common stock (the “Additional Shares”), such that the Company may offer and sell up to an aggregate of $700.0 million in shares of its common stock (the “Offering”) pursuant to the Sales Agreement, as amended by Amendment No. 1 (the “Amended Sales Agreement”). The Company has no obligation to sell any shares of its common stock pursuant to the Amended Sales Agreement and may at any time suspend offers under the Amended Sales Agreement. The Offering will terminate upon (i) the election of the Agent upon the occurrence of certain adverse events, (ii) three business days’ advance notice from one party to the other, or (iii) the sale of all $700.0 million of shares of the Company’s common stock pursuant thereto. Under the terms of the Amended Sales Agreement, the Agent will be entitled to a commission at a fixed rate of 3.0% of the gross proceeds from each sale of shares of the Company’s common stock under the Amended Sales Agreement. During the year ended December 31, 2020, the Company sold an aggregate of 30,991,918 shares of its common stock pursuant to the Sales Agreement and Amended Sales Agreement for aggregate net proceeds to the Company of approximately $227.7 million. Common Stock Purchase Agreement In April 2020, the Company entered into a Common Stock Purchase Agreement (the “Purchase Agreement”) with Arnaki Ltd. (the “Purchaser”), pursuant to which the Purchaser was committed to purchase up to an aggregate of $250.0 million of shares of the Company’s common stock over the 36-month term of the Purchase Agreement. During the year ended December 31, 2020, the Company sold an aggregate of 1,423,077 shares of its common stock pursuant to the Purchase Agreement for aggregate net proceeds of $8.0 million. Effective October 27, 2020, the Company voluntarily terminated the Purchase Agreement. The Purchase Agreement was terminable at will by the Company with no penalty. Aspire Transaction In February 2020, the Company entered into a Common Stock Purchase Agreement (the “Aspire Purchase Agreement”) with Aspire Capital Fund, LLC, (“Aspire Capital”), pursuant to which Aspire Capital was committed to purchase up to an aggregate of $75.0 million of shares of the Company’s common stock over a 24-month term. Upon execution of the Aspire Purchase Agreement, the Company issued to Aspire Capital 897,308 shares of the Company’s common stock as a commitment fee. The Company used and is using proceeds it received under the Aspire Purchase Agreement for working capital and general corporate purposes and for the repayment of the Term Loans. On April 24, 2020, the Aspire Purchase Agreement terminated effective immediately in accordance with its terms as the Company issued and sold, as of such date, an aggregate of 33,825,010 shares of the Company’s common stock for the full $ 75.0 million of shares available for issuance thereunder. Equity Distribution Agreement In April 2020, the Company voluntarily terminated the Equity Distribution Agreement, dated October 1, 2019 (the “Distribution Agreement”), that the Company entered into with JMP Securities LLC (“JMP Sales Agent”), effective immediately. 2019 Public Offering of Common Stock and Warrants In June 2019, the Company entered into an underwriting agreement (the “Underwriting Agreement”) with JMP Securities LLC (the “Representative”), as representative of the several underwriters named therein (the “Underwriters”), relating to a firm commitment underwritten public offering. The net proceeds from the June 2019 Offering were approximately $23.3 million, after deducting underwriting discounts and commissions and other estimated offering expenses, and were received in July 2019. 2019 Registered Direct Offering In October 2019, the Company announced the closing of its previously announced registered direct offering of 10,869,566 shares of its common stock and warrants to purchase up to 10,869,566 shares of its common stock, at a combined purchase price of $2.30 per share and related warrant. The net proceeds from this offering were approximately $23.4 million, after deducting the placement agent’s fees and other estimated offering expenses, and were received in October 2019. |
Stock Incentive and Employee Be
Stock Incentive and Employee Benefit Plans | 12 Months Ended |
Dec. 31, 2020 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock Incentive Plans | 10. Stock Incentive and Employee Benefit Plans 2019 Stock Incentive Plan In September 2019, the Company’s stockholders approved the Sorrento Therapeutics, Inc. 2019 Stock Incentive Plan (the “2019 Plan”). The 2019 Plan replaced and superseded the Company’s Amended and Restated 2009 Stock Incentive Plan (the “2009 Plan”) and no further awards will be granted under the 2009 Plan. The 2019 Plan provides for the grant of incentive stock options, non-incentive stock options, stock appreciation rights, restricted stock awards, unrestricted stock awards, restricted stock unit awards and performance awards to eligible recipients. Recipients of stock options shall be eligible to purchase shares of the Company’s common stock at an exercise price equal to no less than the estimated fair market value of such stock on the date of grant. The maximum term of options granted under the Stock Plan is ten years. Employee option grants generally vest 25% on the first anniversary of the original vesting commencement date, with the balance vesting monthly over the remaining three years. The following table summarizes stock option activity as of December 31, 2020 under the 2019 Plan and the 2009 Plan, and the changes for the period then ended (dollar values in thousands, other than weighted-average exercise price): Options Outstanding Weighted- Average Exercise Price Aggregate Intrinsic Value Outstanding at December 31, 2019 14,586,661 $ 4.36 — Options Granted 8,435,900 5.73 Options Canceled (2,957,970 ) 4.52 Options Exercised (1,301,671 ) 4.25 Outstanding at December 31, 2020 18,762,920 $ 4.97 $ 40,702 During the year ended December 31, 2020, the Company also granted 37,891 shares of unrestricted stock that vested on the grant date and were fully expensed in the period therein. The aggregate intrinsic value of options exercised during the years ended December 31, 2020, 2019 and 2018 was $4.1 million, $0.5 million and $0.1 million, respectively. The fair value of employee stock options was estimated at the grant date using the following assumptions: Years Ended December 31, 2020 2019 2018 Weighted-average grant date fair value $ 4.54 $ 3.40 $ 3.65 Dividend yield — — — Volatility 105 % 96 % 81 % Risk-free interest rate 0.46 % 2.02 % 2.87 % Expected life of options (years) 5.7 6.0 6.1 The assumed dividend yield was based on the Company’s expectation of not paying dividends in the foreseeable future. The expected volatility is based on the historical volatility of the Company's stock. The risk-free interest rate is based on the U.S. Treasury yield curve over the expected term of the option. The weighted average expected life of options was estimated using the average of the contractual term and the weighted average vesting term of the options. Under the 2019 Plan and the Company’s prior equity award and option plans, total stock-based compensation recorded as operating expense was $15.0 million, $8.3 million and $6.2 million for the years ended December 31, 2020, 2019 and 2018, respectively. The total unrecognized compensation cost related to unvested employee and director stock option grants as of December 31, 2020 was $40.1 million and the weighted average period over which these grants are expected to vest is 2.8 years. Scilex Holding Company In June 2019, the stockholders of Scilex Holding approved the Scilex Holding Company 2019 Stock Option Plan (the “2019 Stock Option Plan”). Under Scilex Holding, total stock-based compensation recorded as operating expenses was $5.4 million, $4.3 million and $0.3 million for the years ended December 31, 2020, 2019 and 2018, respectively. The total unrecognized compensation cost related to unvested employee and director stock option grants as of December 31, 2020 was $10.3 million and the weighted average period over which these grants are expected to vest is 2.2 years. As of December 31, 2020, options to purchase 38,234,314 shares of the common stock of Scilex Holding were outstanding and 10,023,186 shares were reserved for awards available for future issuance under the 2019 Stock Option Plan. Employee Stock Purchase Plan On October 16, 2020 at the Company’s 2020 Annual Meeting of Stockholders (the “Annual Meeting”), the Company’s stockholders approved the Company’s 2020 Employee Stock Purchase Plan (“ESPP”). Under the terms of the ESPP, the Company’s employees can elect to have up to 15% of their annual compensation, up to a maximum of $25,000 per year, withheld to purchase shares of the Company’s common stock for a purchase price equal to 85% of the lesser of the fair market value per share (at closing) of the Company’s common stock on (i) the commencement date of the six-month offering period, or (ii) the respective purchase date. The initial offering period commenced on November 6, 2020 and will end on May 5, 2021, with subsequent offering periods commencing on May 6 th th CEO Performance Award On August 7, 2020, the Compensation Committee of the Company`s Board of Directors (the “Compensation Committee”) approved a grant to Henry Ji, Ph.D., the Company’s Chairman of the Board, Chief Executive Officer and President, of a 10-year CEO performance award tied solely to achieving market capitalization milestones (the “CEO Performance Award”), subject to approval of the Company’s stockholders at the Annual Meeting. The CEO Performance Award consists of a 10-year option to purchase an aggregate of 24,935,882 shares of the Company’s common stock, which was equal to 10% of the Company’s outstanding shares of common stock on the day prior to the date of grant, and vests in ten tranches. Each of the ten tranches vests only if a market capitalization milestone is achieved, To meet the first market capitalization milestone, the Company’s current market capitalization must increase to $5.0 billion. For the next two milestones, the Company’s market capitalization must continue to increase in additional $2.0 billion increments. For the three milestones thereafter, the Company’s market capitalization must increase in additional $3.0 billion increments. For the next three milestones thereafter, the Company’s market capitalization must increase in additional $ 4.0 billion increments. For the final milestone, the Company’s market capitalization must increase by an additional $ 5.0 billion. Thus, for Dr. Ji to fully vest in the award, the Company’s market capitalization must increase to $ 35.0 billion. The exercise price per share subject to the CEO Performance Award is $ 17.30 , which is a 20 % premium to the closing sales price of the Company’s common stock on August 7, 2020, the date the CEO Performance Award was approved by the Compensation Committee. The CEO Performance Award was approved by the Company`s stockholders at the Annual Meeting held on October 16, 2020, which represents the date of grant for accounting purposes. Recognition of stock-based compensation expense of all the tranches commenced on the date of grant, as the probability of meeting the ten market capitalization milestones is not considered in determining the timing of expense recognition. The expense will be recognized ratably over the expected vesting period of each respective tranche . If the related market capitalization milestone is achieved earlier than its expected achievement period, then the stock-based compensation expense for that vesting tranche will be accelerated and recorded in the period in which the associated milestone is achieved. The market capitalization requirement is considered a market condition under FASB ASC Topic 718 Compensation – Stock Compensation and using Monte Carlo simulations. Key assumptions for estimating the performance-based awards fair value at the date of grant included, volatility of the Company’s common stock price, post-vesting exercise behavior, and the derived service period. Total stock-based compensation recorded as operating expense for the CEO Performance Award was $10.8 million for the year ended December 31, 2020. As of December 31, 2020, the Company had approximately $139.5 million of total unrecognized stock-based compensation expense remaining under the CEO Performance Award if all market capitalization milestones are achieved. The assumptions used in determining this valuation included an expected volatility of 91.0%, a dividend yield of zero, a risk-free interest rate of 0.75%, and an expected remaining term of 9.8 years. Common Stock Reserved for Future Issuance As of December 31, 2020, approximately 82.0 million shares of common stock were reserved for future issuance, comprised of 18.6 million shares for common stock warrants, 24.9 million for the CEO Performance Award, 7.5 million reserved for issuance under the ESPP plan and approximately 30.9 million shares under stock incentive plans. As of December 31, 2020, approximately 12.1 million shares of common stock remained available for grant under the 2019 Plan. Employee Benefit Plan The Company maintains a defined contribution 401(k) plan available to eligible employees. Employee contributions are voluntary and are determined on an individual basis, limited to the maximum amount allowable under federal tax regulations. The Company made matching contributions to the 401(k) plan totaling $1.4 million, $1.3 million and $0.9 million, for the years ended December 31, 2020, 2019 and 2018, respectively. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2020 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 11. Commitments and Contingencies Litigation In the normal course of business, the Company may be named as a defendant in one or more lawsuits. Other than as set forth below, the Company is not a party to any outstanding material litigation and management is currently not aware of any legal proceedings that, individually or in the aggregate, are deemed to be material to the Company’s financial condition or results of operations. On April 3, 2019, the Company filed two legal actions against, among others, Patrick Soon-Shiong and entities controlled by him, asserting claims for, among other things, fraud and breach of contract, arising out of Dr. Soon-Shiong’s purchase of the drug Cynviloq™ from the Company in May 2015. The actions allege that Dr. Soon-Shiong and the other defendants, among other things, acquired the drug Cynviloq™ for the purpose of halting its progression to the market. Specifically, the Company has filed: • An arbitration demand with the American Arbitration Association in Los Angeles, California against NantPharma, LLC and Chief Executive Officer Patrick Soon-Shiong, seeking damages in excess of $1.0 billion, as well as additional punitive damages, related to alleged fraud and breaches of the Stock Sale and Purchase Agreement, dated May 14, 2015, entered into between NantPharma, LLC and the Company, filed as Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission (the “SEC”) on August 7, 2015. On May 24, 2019, NantCell, Inc., Dr. Soon-Shiong and Immunotherapy NANTibody LLC (“NANTibody”) General Counsel Charles Kim filed a motion in the Los Angeles Superior Court to stay or dismiss the Company’s arbitration demand. On October 9, 2019, the Los Angeles Superior Court denied the motion to stay or dismiss the arbitration demand, and the arbitration is ongoing. On March 5, 2020, the Company filed a legal action against Dr. Soon-Shiong in Los Angeles Superior Court, asserting claims for fraudulent inducement and common law fraud, arising out of Dr. Soon-Shiong’s purchase of the drug Cynviloq™ from the Company in May 2015. The action alleges that, among other things, Dr. Soon-Shiong acquired the drug Cynviloq ™ for the purpose of halting its progression to the market. In connection with filing this civil action in the Los Angeles Superior Court, where the Company will have the right to a jury trial against Dr. Soon-Shiong, the Company has dismissed Dr. Soon-Shiong from the related, ongoing arbitration against NantPharma, LLC ; and • An action in the Los Angeles Superior Court derivatively on behalf of NANTibody against NantCell, Inc., NANTibody Board Member and NantCell, Inc. Chief Executive Officer Patrick Soon-Shiong, and NANTibody officer Charles Kim, related to several breaches of the June 11, 2015 Limited Liability Company Agreement for NANTibody entered into between the Company and NantCell, Inc. The suit also alleges breaches of fiduciary duties and seeks, inter alia, a declaration that the Assignment Agreement entered into on July 2, 2017, between NantPharma, LLC and NANTibody is void and an equitable unwinding of the Assignment Agreement. The suit calls for the restoration of $90.05 million to the NANTibody capital account, thereby restoring the Company’s equity method investment in NANTibody to its invested amount as of June 30, 2017 of $40.0 million. On May 24, 2019, NantCell, Inc. and Dr. Soon-Shiong filed a cross-complaint against the Company and Dr. Ji, seeking unspecified damages, as well as additional punitive damages and specific performance, related to alleged fraud, alleged breaches of the Exclusive License Agreement for certain antibodies (dated April 21, 2015 and entered into between NantCell, Inc. and the Company), and tortious interference with contract. On May 24, 2019, NANTibody and NantPharma, LLC filed a new complaint in the action against the Company and Dr. Ji, seeking unspecified damages, as well as additional punitive damages and specific performance, related to alleged fraud, alleged breaches of the Stock Sale and Purchase Agreement, alleged breaches of the Exclusive License Agreement for certain antibodies (dated April 21, 2015 and entered into between NantCell, Inc. and the Company), and tortious interference with contract. On July 8, 2019, the Company and Dr. Ji filed motions to compel the cross-complaint and new action to arbitration. On October 9, 2019, the Los Angeles Superior Court granted the motions to compel to arbitration all of the claims brought by NANTibody, NantCell, Inc. and NantPharma, LLC, and denied the motions to compel as to the claims brought by Dr. Soon-Shiong. Subsequently, NANTibody, NantCell, Inc., and NantPharma, LLC have re-filed their claims in arbitration. On July 21, 2020, NantPharma, LLC’s demands in arbitration were dismissed. The arbitration claims by NANTibody and NantCell are currently pending before the American Arbitration Association. The claims against Dr. Soon-Shiong have been stayed pending resolution of the claims filed in arbitration. The original derivative action is no longer stayed, and the parties are currently engaged in discovery in the suit. On May 26, 2020, Wasa Medical Holdings filed a putative federal securities class action in the U.S. District Court for the Southern District of California, Case No. 3:20-cv-00966-AJB-DEB, against us, our President, Chief Executive Officer and Chairman of the Board of Directors, Henry Ji, Ph.D., and our SVP of Regulatory Affairs, Mark R. Brunswick, Ph.D. The action alleges that the Company, Dr. Ji and Dr. Brunswick made materially false and/or misleading statements to the investing public by publicly issuing false and/or misleading statements regarding STI-1499 and its ability to inhibit the SARS-CoV-2 virus infection and that such statements violated Section 10(b) of the Securities Exchange Act of 1934, as amended, and Rule 10b-5 promulgated thereunder. The suit seeks to recover damages caused by the alleged violations of federal securities laws, along with the plaintiffs’ reasonable costs and expenses incurred in the lawsuit, including counsel fees and expert fees. On June 11, 2020, Jeannette Calvo filed a second putative federal securities class action in the U.S. District Court for the Southern District of California, Case No. 3:20-cv-01066-JAH-WVG, against the same defendants alleging the same claims and seeking the same relief. On February 12, 2021, the U.S. District Court for the Southern District of California issued an order consolidating the cases and appointing a lead plaintiff, Andrew Zenoff (“Plaintiff”), and lead counsel. It is anticipated that the Plaintiff will file a consolidated amended complaint pursuant to a court scheduling order or stipulation of the parties. No deadline for the filing of that complaint or any response thereto by defendants has been set. The Company is defending these matters vigorously. Operating Leases The Company leases administrative, research and development, sales and marketing and manufacturing facilities under various non-cancelable lease agreements. Facility leases generally provide for periodic rent increases, and many contain escalation clauses and renewal options. As of December 31, 2020, the Company’s leases have remaining lease terms of approximately 0.5 to 8.9 years Operating lease costs were approximately $10.1 million, $10.0 million and $6.1 million for the twelve months ended December 31, 2020, 2019 and 2018, respectively, and were primarily comprised of long-term operating lease costs. Short-term operating lease costs were immaterial. Supplemental quantitative information related to leases includes the following (in thousands): Year ended December 31, 2020 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash outflows from operating leases $ 9,880 $ 6,935 ROU assets obtained in exchange for new and amended operating lease liabilities $ 1,878 $ 6,777 Weighted average remaining lease term in years 8.4 9.4 Weighted average discount rate 12.2 % 12.2 % Maturities of lease liabilities are as follows (in thousands): Years ending December 31, Operating leases 2021 $ 10,010 2022 10,054 2023 10,285 2024 10,418 2025 9,757 Thereafter 37,586 Total lease payments 88,110 Less imputed interest (34,183 ) Total lease liabilities as of December 31, 2020 $ 53,927 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 12. Income Taxes Total loss before income taxes summarized by region for the years ended December 31, 2020, 2019 and 2018 is as follows (in thousands): 2020 2019 2018 United States $ (315,516 ) $ (362,776 ) $ (216,098 ) Foreign (908 ) (709 ) (2,702 ) Total $ (316,424 ) $ (363,485 ) $ (218,800 ) The components of the provision expense (benefit) were as follows for the years ended December 31, 2020, 2019 and 2018 (in thousands): 2020 2019 2018 Current income tax expense (benefit): Federal $ (19 ) $ (68 ) $ (178 ) State 72 27 23 Foreign 58 (37 ) (44 ) Total current 111 (78 ) (199 ) Deferred income tax expense (benefit): Federal (55,321 ) (53,080 ) (31,042 ) State (2,730 ) (12,173 ) (5,534 ) Foreign (288 ) (154 ) (611 ) Total deferred (58,339 ) (65,407 ) (37,187 ) Changes in tax rate 507 (94 ) (453 ) Changes in valuation allowance 55,707 65,106 31,565 Total income tax benefit from continuing operations $ (2,014 ) $ (473 ) $ (6,274 ) Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The components of the Company’s net deferred tax liabilities and related valuation allowance are as follows as of December 31, 2020 and 2019 (in thousands): 2020 2019 Deferred tax assets: Net operating loss carryforwards $ 134,072 $ 91,376 Deferred revenue 25,456 26,064 Tax credit carryforwards 22,209 17,575 Amortization of intangibles 31,140 26,843 Operating lease liabilities 11,726 12,935 Derivative liability — 4,150 Stock based compensation 5,359 3,593 Accrued expenses and other 36,481 25,958 Total deferred tax assets 266,443 208,494 Less valuation allowance (203,512 ) (148,140 ) Total deferred tax assets 62,931 60,354 Deferred tax liabilities: Investment in common stock (45,507 ) (46,584 ) Operating lease right-of-use assets (9,146 ) (10,888 ) Other (1,925 ) (450 ) Amortization of intangibles (13,274 ) (11,475 ) Total deferred tax liabilities (69,852 ) (69,397 ) Net deferred tax liabilities $ (6,921 ) $ (9,043 ) The reconciliation between U.S. federal income taxes at the statutory rate and the Company’s provision for income taxes are as follows for the years ended December 31, 2020, 2019 and 2018 (in thousands): 2020 2019 2018 Income tax benefit at federal statutory rate $ (66,449 ) $ (76,332 ) $ (46,011 ) Valuation allowance 55,707 65,106 31,565 State, net of federal tax benefit (3,339 ) (8,904 ) (3,075 ) Debt discount and interest limitation 896 7,013 11,357 Income tax credits and incentives (3,685 ) (3,018 ) (3,785 ) Compensation expense 4,446 764 1,309 Acquisition related charges 583 18,811 780 Prior year true-up and carryback 7,790 (187 ) (889 ) Other 2,037 (3,726 ) 2,475 Income tax benefit $ (2,014 ) $ (473 ) $ (6,274 ) The Company has evaluated the available evidence supporting the realization of its gross deferred tax assets, including the amount and timing of future taxable income, and has determined that it is more likely than not that the deferred tax assets will not be realized. Due to such uncertainties surrounding the realization of the domestic deferred tax assets, the Company maintains a valuation allowance of $203.5 million against its deferred tax assets as of December 31, 2020. Realization of the deferred tax assets will be primarily dependent upon the Company's ability to generate sufficient taxable income prior to the expiration of its net operating losses. For 2019, the change in valuation allowance also included approximately $8.1 million attributable to the Semnur Pharmaceuticals, Inc. acquisition. As of December 31, 2020, the Company had $566.8 million, $185.8 million and $19.9 million of federal, state and foreign net operating loss carryforwards, respectively. The net operating loss carryforwards begin to expire in 2034, 2028 and 2024 for federal, state and foreign, respectively. The Company also had research and development and orphan drug income tax credits of $19.2 million and $10.8 million for federal and state, respectively. The federal income tax credits begin to expire in 2029, while the state income tax credits carryforward indefinitely. Internal Revenue Code Section 382 rules apply to limit a corporation's ability to utilize existing net operating loss and tax credit carryforwards once the corporation experiences an ownership change as defined in Section 382. The Company has undergone an ownership change in a prior year. For the year ended December 31, 2020, there was no impact of such limitations on the Company’s income tax provision. The Company is subject to taxation in the U.S., various state tax jurisdictions and various foreign tax jurisdictions. The Company's tax years starting on January 1, 2007 through December 31, 2020 are open and subject to examination by the U.S. and state taxing authorities due to the carryforward of net operating losses and research and development credits. There are no active audits as of December 31, 2020. A reconciliation of the beginning and ending amount of unrecognized tax expense (benefits) is as follows for the years ended December 31, 2020, 2019 and 2018 (in thousands): 2020 2019 2018 Beginning balance $ 5,336 $ 4,352 $ 3,883 Increase related to prior year tax positions 133 257 150 Decrease related to prior year tax positions 0 (7 ) (597 ) Increase related to current year tax positions 928 734 916 Ending balance $ 6,397 $ 5,336 $ 4,352 At December 31, 2020, 2019 and 2018, $5.6 million, $4.4 million and $3.6 million, respectively, of the Company’s total unrecognized tax benefits, if recognized, would impact the effective tax rate, however given the full valuation allowance in the jurisdiction in which the unrecognized tax benefits relate to, the impact on the effective tax rate would be nil. The Company’s policy is to recognize interest and penalties related to income tax matters in income tax expense. No interest or penalties have been recognized as of and for the periods ended December 31, 2020, 2019 or 2018. The Company believes that no material amount of the liabilities for uncertain tax positions will expire within 12 months of December 31, 2020. |
Related Party Agreements and Ot
Related Party Agreements and Other | 12 Months Ended |
Dec. 31, 2020 | |
Related Party Transactions [Abstract] | |
Related Party Agreements and Other | 13. Related Party Agreements and Other Jaisim Shah, a member of the Company’s Board of Directors, was Semnur’s Chief Executive Officer, a member of its Board of Directors and a stockholder of Semnur prior to the acquisition transaction. Semnur is party to an Assignment Agreement with Shah Investor LP, pursuant to which Shah Investor LP assigned certain intellectual property to Semnur and Semnur agreed to pay Shah Investor LP a contingent quarterly royalty in the low-single digits based on quarterly net sales of any pharmaceutical formulations for local delivery of steroids by injection developed using such intellectual property, which would include SEMDEXA. Mahendra Shah, Ph.D., who served on the board of directors of Scilex Holding from March 2019 to October 2020, is the managing partner of Shah Investor LP. As of December 31, 2020, approximately 14.7% of the outstanding capital stock of Scilex Holding represented a noncontrolling interest and was held by ITOCHU CHEMICAL FRONTIER Corporation. Scilex Pharma has entered into a product development agreement (the “Product Development Agreement”) with ITOCHU CHEMICAL FRONTIER Corporation and another party (together, the “Developers”), which together serve as the sole manufacturer and supplier to Scilex Pharma for lidocaine tape products, including ZTlido and SP-103 (each, a “Product”). During the year ended December 31, 2020, Scilex Pharma purchased approximately $1.0 million of inventory from the Developers pursuant to the Product Development Agreement. Pursuant to the Product Development Agreement, Scilex Pharma is required to make aggregate royalty payments between 25% and 35% to the Developers based on net profits. Net profits are defined as net sales, less cost of goods and marketing expenses. Net sales are defined as total gross sales of any Product, less all applicable deductions, to the extent accrued, paid or allowed in the ordinary course of business with respect to the sale of such Product, and to the extent that they are in accordance with U.S. GAAP. If Scilex Pharma were to sublicense the licensed technologies, the Developers will receive the same proportion of any sub-licensing fees received therefrom. The Product Development Agreement will continue in full force and effect until October 2, 2028, the date that is ten years from the date of the first commercial sale of ZTlido. The Product Development Agreement will renew automatically for subsequent successive one-year On July 15, 2020, the Company entered into a consulting agreement with Kim Janda, Ph.D., a member of the Company’s Board of Directors, pursuant to which Dr. Janda will provide consulting and advisory services in exchange for (i) a one-time fee of $250,000, which is payable at a rate of 1/12th per month over twelve months , and (ii) an option to purchase up to 150,000 shares of the Company’s common stock, which was granted on August 7, 2020 and vests at a rate of 1/48th per month commencing on July 15, 2020 . On May 13, 2020, the Company entered into a license agreement with Pulsar Therapeutics, Inc. (“Pulsar”), pursuant to which it licensed Pulsar’s nanoparticle technology for vaccine and antibody uses in exchange for a cash payment, certain royalties of net sales, a sublicense fee and an investment by the Company in Pulsar through the transfer of 1.0 million shares of the Company’s common stock in exchange for a 5.0% equity interest in Pulsar. As of the date of the investment, Henry Ji, Ph.D., a member of the Company’s Board of Directors and the Company’s Chief Executive Officer and President, was a director and chairperson of the board of directors of Pulsar and owned approximately 45.0% of Pulsar’s outstanding shares, and Jaisim Shah, a member the Company’s Board of Directors, owned approximately 5.0% of Pulsar’s outstanding shares. On May 15, 2020, the Company acquired a 50% equity interest in Cytimm Therapeutics, Inc. (“Cytimm”) in exchange for an investment of $2.5 million by the Company. As of the date of the acquisition, Henry Ji, Ph.D., a member of the Company’s Board of Directors and the Company’s Chief Executive Officer and President, was a director, the chairperson of the board of directors and a stockholder of Cytimm. |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
Segment Information | 14. Segment Information As of January 1, 2019, the Company realigned its businesses into two operating and reportable segments, Sorrento Therapeutics and Scilex. The Company reports segment information based on the management approach. The management approach designates the internal reporting used by the Chief Operating Decision Maker (“CODM”), which is the Company’s Chief Executive Officer, for making decisions and assessing performance as the source of the Company’s reportable segments. The CODM allocates resources and assesses the performance of each operating segment based on licensing, product sales and services revenue, operating expenses, and operating income (loss) before interest and taxes. The Company has determined its reportable segments to be Sorrento Therapeutics and Scilex based on the information used by the CODM. Sorrento Therapeutics . The Sorrento Therapeutics segment is organized around the Company’s immuno-oncology therapeutic area, leveraging its proprietary G-MAB™ antibody library and targeted delivery modalities to generate the next generation of cancer therapeutics. These modalities include proprietary CAR-T, DAR-T, and ADCs as well as bispecific antibody approaches. Additionally, this segment also includes Sofusa ® Scilex . The Scilex segment is largely organized around the Company’s non-opioid pain management operations. Revenues from the Scilex segment are exclusively derived from the sale of ZTlido. • In October 2018, Scilex Pharma commercially launched ZTlido and began recognizing revenue. • Semnur’s SEMDEXA TM TM The Company manages its assets on a company basis, not by segments, as many of its assets are shared or commingled. With the exception of unrestricted cash balances, the Company’s CODM does not regularly review asset information by reportable segment. The majority of long-lived assets for both segments are located in the United States. The following table presents information about the Company’s reportable segments for the twelve months ended December 31, 2020, 2019 and 2018 (in thousands): Twelve Months Ended December 31, 2020 2019 2018 (in thousands) Sorrento Therapeutics Scilex Total Sorrento Therapeutics Scilex Total Sorrento Therapeutics Scilex Total External revenues $ 13,655 $ 26,331 $ 39,986 $ 10,399 $ 21,033 $ 31,432 $ 18,587 $ 2,606 $ 21,193 Operating expenses 225,687 58,817 284,504 130,529 160,296 290,825 137,166 34,452 171,618 Operating (loss) income (212,032 ) (32,486 ) (244,518 ) (120,130 ) (139,263 ) (259,393 ) (118,579 ) (31,846 ) (150,425 ) Unrestricted cash 51,475 4,989 56,464 12,176 10,345 22,521 86,024 72,714 158,738 |
Quarterly Financial Data (Unaud
Quarterly Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2020 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Data (Unaudited) | 15. Quarterly Financial Data (Unaudited) The following table sets forth selected quarterly data for the years presented, in thousands, except per share data. Quarter Ended Quarter Ended Quarter Ended Quarter Ended Year Ended 2020 December 31, September 30, June 30, March 31, December 31, Revenues $ 11,505 $ 11,753 $ 9,007 $ 7,721 $ 39,986 Operating costs and expenses $ 82,028 $ 94,857 $ 56,735 $ 50,884 $ 284,504 Net loss attributable to Sorrento $ (71,503 ) $ (84,023 ) $ (77,740 ) $ (65,195 ) $ (298,461 ) Net loss per share - basic $ (0.27 ) $ (0.33 ) $ (0.36 ) $ (0.36 ) $ (1.30 ) Net loss per share - diluted $ (0.27 ) $ (0.33 ) $ (0.36 ) $ (0.36 ) $ (1.30 ) Weighted-average shares - basic 267,863 251,211 216,956 182,609 229,823 Weighted-average shares - diluted 267,863 257,670 216,956 182,609 229,823 Quarter Ended Quarter Ended Quarter Ended Quarter Ended Year Ended 2019 December 31, September 30, June 30, March 31, December 31, Revenues $ 13,034 $ 5,778 $ 6,477 $ 6,143 $ 31,432 Operating costs and expenses $ 45,613 $ 59,061 $ 56,838 $ 129,313 $ 290,825 Net loss attributable to Sorrento $ (62,820 ) $ (64,415 ) $ (56,762 ) $ (108,071 ) $ (292,068 ) Net loss per share - basic $ (0.41 ) $ (0.49 ) $ (0.46 ) $ (0.88 ) $ (2.20 ) Net loss per share - diluted $ (0.41 ) $ (0.50 ) $ (0.47 ) $ (0.88 ) $ (2.35 ) Weighted-average shares - basic 154,964 130,800 122,549 122,281 132,732 Weighted-average shares - diluted 154,964 140,445 132,459 122,281 140,514 |
Loss Per Share
Loss Per Share | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Loss Per Share | 16. Loss Per Share For the years ended December 31, 2020, 2019, and 2018, basic earnings per share of common stock is computed by dividing net income by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share of common stock is calculated to give effect to all dilutive securities, using the treasury stock method and the if-converted method for potentially dilutive shares of common stock issuable upon the Semnur Share Exchange, which is described in Note 7 The following table sets forth the reconciliation of basic and diluted earnings per share for the years ended December 31, 2020, 2019 and 2018 (in thousands, except per share): Years Ended December 31, 2020 2019 2018 Numerator Net loss attributable to Sorrento $ (298,461 ) $ (292,068 ) $ (203,540 ) Net loss attributable to Semnur holders of Scilex Holding — (38,669 ) — Net loss used for diluted earnings per share (298,461 ) (330,737 ) (203,540 ) Denominator for basic loss per share 229,823 132,732 106,150 Potentially dilutive shares of Sorrento common stock issuable upon Semnur Share Exchange — 7,782 — Denominator for loss earnings per share 229,823 140,514 106,150 Basic loss per share $ (1.30 ) $ (2.20 ) $ (1.92 ) Diluted loss per share $ (1.30 ) $ (2.35 ) $ (1.92 ) The potentially dilutive stock options and warrants that would have been excluded because the effect would have been anti-dilutive consisted of the following (in thousands): Years Ended December 31, 2020 2019 2018 Outstanding options 18,763 14,587 10,523 Outstanding warrants 18,605 57,556 25,635 |
Organization and Significant _2
Organization and Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Description of Business | Description of Business Sorrento Therapeutics, Inc. (the “Company”) is a clinical stage, antibody-centric, biopharmaceutical company developing new therapies to treat cancers and COVID-19. The Company’s multimodal, multipronged approach to fighting cancer is made possible by its extensive immuno-oncology platforms, including key assets such as fully human antibodies (“G-MAB™ library”), clinical stage immuno-cellular therapies (“CAR-T”, “DAR-T™”), antibody-drug conjugates (“ADCs”) and clinical stage oncolytic virus (Seprehvir™). The Company is also developing potential antiviral therapies and vaccines against coronaviruses, including COVI-GUARD™, COVI-AMG™, COVI-SHIELD™, Gene-MAb™, COVI-MSC™ and COVI-DROPS™; and diagnostic test solutions, including COVI-TRACK™, COVI-STIX™ and COVI-TRACE™. The Company’s commitment to life-enhancing therapies for patients is also demonstrated by our effort to advance a first-in-class (TRPV1 agonist) non-opioid pain management small molecule, resiniferatoxin (“RTX”), and SP-102 (10 mg, dexamethasone sodium phosphate viscous gel) (SEMDEXA™), a novel, viscous gel formulation of a widely used corticosteroid for epidural injections to treat lumbosacral radicular pain, or sciatica, and through the commercialization of ZTlido ® |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company`s subsidiaries. For consolidated entities where the Company owns or is exposed to less than 100% of the economics, the Company records net income (loss) attributable to noncontrolling interests in its consolidated statements of operations equal to the percentage of the economic or ownership interest retained in such entities by the respective noncontrolling parties. All intercompany balances and transactions have been eliminated in consolidation. The Company operates in two operating and reportable segments, Sorrento Therapeutics and Scilex. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Management believes that these estimates are reasonable; however, actual results may differ from these estimates. |
Cash and Cash Equivalents, Restricted Cash | Cash and Cash Equivalents The Company considers all highly liquid investments purchased with original maturities of three months or less to be cash equivalents. Cash and cash equivalents consist of money market accounts and bank deposits, which are highly liquid and readily tradable. Restricted Cash As of December 31, 2020 there was no restricted cash in the Company`s consolidated balance sheet. Restricted cash in the Company's consolidated balance sheet as of December 31, 2019 included approximately $45.0 million of restricted cash related to the Scilex Notes in the form of both the Reserve Account and the Collateral Account (See Note 8 |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The Company follows accounting guidance on fair value measurements for financial instruments measured on a recurring basis, as well as for certain assets and liabilities that are initially recorded at their estimated fair values. Fair value is defined as the exit price, or the amount that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company uses the following three-level hierarchy that maximizes the use of observable inputs and minimizes the use of unobservable inputs to value its financial instruments: • Level 1: Observable inputs such as unadjusted quoted prices in active markets for identical instruments. • Level 2: Quoted prices for similar instruments that are directly or indirectly observable in the marketplace. • Level 3: Significant unobservable inputs which are supported by little or no market activity and that are financial instruments whose values are determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant judgment or estimation. Financial instruments measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires it to make judgments and consider factors specific to the asset or liability. The use of different assumptions and/or estimation methodologies may have a material effect on estimated fair values. Accordingly, the fair value estimates disclosed or initial amounts recorded may not be indicative of the amount that the Company or holders of the instruments could realize in a current market exchange. The carrying amounts of cash equivalents approximate their fair value based upon quoted market prices. Certain of the Company’s financial instruments are not measured at fair value on a recurring basis, but are recorded at amounts that approximate their fair value due to their liquid or short-term nature, such as accounts receivable and payable, and other financial instruments in current assets or current liabilities. |
Accounts Receivable, Net | Accounts Receivable, Net Accounts receivable are presented net of allowances for expected credit losses and consist of trade receivables from sales and services provided to certain customers, which are generally unsecured. Estimated credit losses related to trade accounts receivable are recorded as general and administrative expenses and as an allowance for doubtful accounts and accounts receivable, net. The Company reviews reserves and makes adjustments based on historical experience and known collectability issues and disputes. When internal collection efforts on accounts have been exhausted, the accounts are written off by reducing the allowance for doubtful accounts. The allowance for doubtful accounts is not material. |
Inventory, Net | Inventory, Net The Company determines inventory cost on a first-in, first-out basis. The Company reduces the carrying value of inventories to a lower of cost or net realizable value for those items that are potentially excess, obsolete or slow-moving. The Company considers the need for allowances for excess and obsolete inventory based upon historical experience, sales trends, and specific categories of inventory and expiration dates for inventory on hand. As of December 31, 2020, net inventory was $1.8 million and primarily comprised of finished goods. Net inventory as of December 31, 2019 was $3.4 million and primarily comprised of finished goods. |
Property and Equipment | Property and Equipment Property and equipment are carried at cost less accumulated depreciation. Depreciation of property and equipment is computed using the straight-line method over the estimated useful lives of the assets, which are generally three to five years. Leasehold improvements are amortized over the lesser of the life of the lease or the life of the asset. Repairs and maintenance are charged to expense as incurred. |
Acquisitions and Acquired In-Process Research and Development Expense | Acquisitions The Company accounts for business combinations using the acquisition method of accounting, which requires that assets acquired, including in-process research and development (“IPR&D”) projects and liabilities assumed be recorded at their fair values as of the acquisition date on the Company`s consolidated balance sheets. Any excess of purchase price over the fair value of net assets acquired is recorded as goodwill. The determination of estimated fair value requires the Company to make significant estimates and assumptions. As a result, the Company may record adjustments to the fair values of assets acquired and liabilities assumed within the measurement period (up to one year from the acquisition date) with the corresponding offset to goodwill. Transaction costs associated with business combinations are expensed as they are incurred. When the Company determines net assets acquired do not meet the definition of a business combination under the acquisition method of accounting, the transaction is accounted for as an acquisition of assets and, therefore, no goodwill is recorded and contingent consideration such as payments upon achievement of various developmental, regulatory and commercial milestones generally is not recognized at the acquisition date. In an asset acquisition, up-front payments allocated to IPR&D projects at the acquisition date and subsequent milestone payments are charged to expense in the Company`s consolidated statements of operations unless there is an alternative future use. Acquired In-Process Research and Development Expense The Company has acquired, and may continue to acquire, the rights to develop and commercialize new drug candidates. The up-front payments to acquire new drug compounds or drug delivery devices, as well as future milestone payments associated with assets that do not meet the definition of a derivative and that are deemed probable to achieve , are immediately expensed as acquired IPR&D , provided that the drug candidates ha ve not achieved regulatory approval for marketing and, absent obtaining such approval, have no alternative future use. Intangible assets acquired in a business combination that are used for IPR&D activities are considered indefinite lived until the completion or abandonment of the associated research and development efforts. Upon commercialization of the relevant research and development project, the Company amortizes the acquired IPR&D over its estimated useful life. Capitalized IPR&D is reviewed annually for impairment or more frequently as changes in circumstance or the occurrence of events suggest that the remaining value may not be recoverable. |
Goodwill and Other Long-Lived Assets | Goodwill and Other Long-Lived Assets Goodwill, which has an indefinite useful life, represents the excess of cost over fair value of net assets acquired. Goodwill is reviewed at the reporting unit level for impairment at least annually during the fourth quarter, or more frequently if events occur indicating the potential for impairment. During its goodwill impairment review, the Company assesses qualitative factors to determine whether it is more likely than not that the fair value of its reporting unit is less than its carrying amount, including goodwill. The qualitative factors include, but are not limited to, macroeconomic conditions, industry and market considerations, and the overall financial performance of the Company. If, after assessing the totality of these qualitative factors, the Company determines that it is not more likely than not that the fair value of its reporting unit is less than its carrying amount, then no additional assessment is deemed necessary. Otherwise, the Company performs a quantitative goodwill impairment test. The Company may also elect to bypass the qualitative assessment in a period and elect to proceed to perform the quantitative goodwill impairment test. The Company performed its annual assessment for goodwill impairment at the Sorrento Therapeutics and Scilex reporting unit levels in the fourth quarter of 2020, noting no indication of impairment. There were no triggering events indicating the potential for impairment through December 31, 2020. The Company evaluates its long-lived and intangible assets with definite lives, such as property and equipment, acquired technology, customer relationships, patent and license rights, for impairment by considering the expected use of the assets and the effects of obsolescence, demand, anticipated technological advances, market influences and other economic factors. The factors that drive the estimate of useful life are often uncertain and are reviewed on a periodic basis or when events occur that warrant review. Recoverability is measured by comparison of the assets’ book value to future net undiscounted cash flows that the assets are expected to generate. No impairment charges were recorded during the year ended December 31, 2020. |
Debt, Including Debt With Detachable Warrants | Debt, Including Debt With Detachable Warrants Detachable warrants are evaluated for the classification of warrants as either equity instruments, derivative liabilities, or liabilities depending on the specific terms of the warrant agreement. In circumstances in which debt is issued with equity-classified warrants, the proceeds from the issuance of debt are first allocated to the debt and the warrants at their relative estimated fair values. The portion of the proceeds allocated to the warrants are accounted for as paid-in capital and a debt discount. The remaining proceeds, as further reduced by discounts created by the bifurcation of embedded derivatives and beneficial conversion features, are allocated to the debt. The Company accounts for debt as liabilities measured at amortized cost and amortizes the resulting debt discount from the allocation of proceeds, to interest expense using the effective interest method over the expected term of the debt instrument. The Company considers whether there are any embedded features in debt instruments that require bifurcation and separate accounting as derivative financial instruments pursuant to Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 815, Derivatives and Hedging If the amount allocated to the convertible debt results in an effective per share conversion price less than the fair value of the Company’s common stock on the commitment date, the intrinsic value of this beneficial conversion feature is recorded as a discount to the convertible debt with a corresponding increase to additional paid in capital. The beneficial conversion feature discount is equal to the difference between the effective conversion price and the fair value of the Company’s common stock at the commitment date, unless limited by the remaining proceeds allocated to the debt. The Company may enter financing arrangements, the terms of which involve significant assumptions and estimates, including future net product sales, in determining interest expense, amortization period of the debt discount, as well as the classification between current and long-term portions. In estimating future net product sales, the Company assesses prevailing market conditions using various external market data against the Company’s anticipated sales and planned commercial activities. Consequently, the Company imputes interest on the carrying value of the debt and records interest expense using an imputed effective interest rate. The Company reassesses the expected payments each reporting period and accounts for any changes through an adjustment to the effective interest rate on a prospective basis, with a corresponding impact to the classification of the Company’s current and long-term portions. |
Derivative Liabilities | Derivative Liabilities Derivative liabilities are recorded on the Company`s consolidated balance sheets at their fair value on the date of issuance and are revalued on each balance sheet date until such instruments are settled or expire, with changes in the fair value between reporting periods recorded as other income or expense. |
Investments in Other Entities | Investments in Other Entities The Company holds a portfolio of investments in equity securities. Investments in entities over which the Company has significant influence, but not a controlling interest, are accounted for using the equity method, with the Company’s share of earnings or losses reported in loss on equity method investments. |
Research and Development Costs | Research and Development Costs The Company expenses the cost of research and development as incurred. Research and development expenses are comprised of costs incurred in performing research and development activities, including clinical trial costs, manufacturing costs for both clinical and preclinical materials as well as other contracted services, license fees and other external costs. Nonrefundable advance payments for goods and services that will be used in future research and development activities are expensed when the activity is performed or when the goods have been received, rather than when payment is made, in accordance with FASB ASC Topic 730, Research and Development |
Income Taxes | Income Taxes The provisions of the FASB ASC Topic 740 “Income Taxes,” The Company accounts for income taxes using the asset and liability method to compute the differences between the tax basis of assets and liabilities and the related financial amounts, using currently enacted tax rates. The Company has deferred tax assets, which are subject to periodic recoverability assessments. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount that more likely than not will be realized. As of December 31, 2020, the Company maintained a full valuation allowance against its deferred tax assets, with the exception of an amount equal to its deferred tax liabilities that are scheduled to reverse against the Company's deferred tax assets. |
Leases | Leases The Company determines if an arrangement is a lease at inception. Operating lease right-of-use (“ROU”) assets and lease liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. As the Company`s leases do not provide an implicit rate, it uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of lease payments. The Company calculates the associated lease liability and corresponding ROU asset upon lease commencement using a discount rate based on a credit-adjusted secured borrowing rate commensurate with the term of the lease. The operating lease ROU asset also includes any lease payments made and is reduced by lease incentives. The Company`s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. |
Revenue Recognition | Revenue Recognition The Company`s revenues are generated from product revenues, the sale of customized reagents and other materials, contract manufacturing services, and other service revenues. The following table shows revenue disaggregated by product and service type for the years ended December 31, 2020, 2019 and 2018 (in thousands): Years Ended December 31, 2020 2019 2018 Scilex Pharmaceuticals Inc. product sales $ 26,331 $ 21,033 $ 2,606 Other product revenue 297 941 3,267 Net product revenue $ 26,628 $ 21,974 $ 5,873 Concortis Biosystems Corporation 7,730 6,520 5,159 Bioserv Corporation 4,976 2,450 5,992 Joint development agreement — — 3,333 Other service revenue 652 488 836 Service revenue $ 13,358 $ 9,458 $ 15,320 The Company is obligated to accept from customers the return of products sold that are damaged or do not meet certain specifications. The Company may authorize the return of products sold in accordance with the terms of its sales contracts and estimates allowances for such amounts at the time of sale. The Company has not experienced any material sales returns. The Company does not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts for which it recognizes revenue at the amount to which it has the right to invoice for services performed. Scilex Product Sales Revenues from product sales is fully comprised of sales of ZTlido. The Company's performance obligation with respect to sales of ZTlido is satisfied at a point in time, which transfers control upon delivery of product to the customer. The Company considers control to have transferred upon delivery because the customer has legal title to the asset, physical possession of the asset has been transferred to the customer, the customer has significant risks and rewards of ownership of the asset, and the Company has a present right to payment at that time. The Company identified a single performance obligation. Invoicing typically occurs upon shipment and the length of time between invoicing and when payment is due is not significant. The aggregate dollar value of unfulfilled orders as of December 31, 2020 was not material. Sales of ZTlido are generated within the United States. Substantially all of the Company’s product revenue and accounts receivable result from a sole customer. For product sales, the Company records gross-to-net sales adjustments for government and managed care rebates, chargebacks, wholesaler and distributor fees, sales returns and prompt payment discounts. Such variable consideration is estimated in the period of the sale and are estimated using a most likely amount approach based primarily upon provisions included in the Company’s customer contract, customary industry practices and current government regulations. Other Product Revenue Revenues from the sale of materials associated with the Company's research and development arrangements are recognized at a point in time upon the transfer of control, which is generally upon shipment. Concortis Biosystems Corporation ( “ ” Contract manufacturing associated with sales of customized reagents for Concortis operations relate to providing synthetic expertise to customers’ synthesis by delivering proprietary cytotoxins, linkers and linker-toxins and ADC service using industry standard toxin and antibodies provided by customers which are recognized at a point in time upon the transfer of control, which is generally upon shipment given the short contract terms which are generally three months or less. Bioserv Corporation ( “ ” Contract manufacturing services associated with the Company’s Bioserv operations related to finish and fill activities for drug products and reagents are recognized ratably over the contract term, which reflects the transfer of services to the customer because the manufactured products are highly customized and do not have an alternative use to the Company. As of December 31, 2020 and 2019, the estimated revenue expected to be recognized for future performance obligations associated with contract manufacturing services was approximately $3.4 million and $2.2 million, respectively. Joint Development Agreement In 2017, the Company entered into a joint development agreement with Celularity Inc. (“Celularity”) whereby the Company agreed to provide research services to Celularity through June 2018 in exchange for an upfront payment of $5.0 million. The revenue related to the joint development agreement of $5.0 million was recognized over the length of the service agreement as services were performed. The Company recorded sales and services revenues under the joint development agreement of $3.3 million for the year ended December 31, 2018. The Company recorded no sales and services revenues under the joint development agreement during the years ended December 31, 2020 and 2019 as such arrangement is complete. Other Service Revenue License fees for the licensing of product rights are recorded as deferred revenue upon receipt of cash and recognized as revenue on a straight-line basis over the license period, with the exception of license agreements with no remaining performance obligations or undelivered obligations. The Company applies judgment in determining the timing of revenue recognition related to contracts that include multiple performance obligations. The total transaction price of the contract is allocated to each performance obligation in an amount based on the estimated relative standalone selling prices of the promised goods or services underlying each performance obligation. For goods or services for which observable standalone selling prices are not available, the Company develops an estimated standalone selling price of each performance obligation. As of December 31, 2020, future performance obligations for license revenues relate to the ImmuneOncia Therapeutics, LLC (“ImmuneOncia”) and NantCell, Inc. (“NantCell”) license agreements. The total consideration for the ImmuneOncia license performance obligation, effective September 1, 2016, represented $9.6 million. The estimated revenue expected to be recognized for future performance obligations, as of December 31, 2020, was approximately $7.5 million. The Company expects to recognize license revenue of approximately $0.5 million of the remaining performance obligation annually through the remaining term. The Company applied judgment in estimating the 20-year contract term, analogous to the expected life of the patent, over which revenue is recognized over time given the ongoing performance obligation related to the Company's participation on a steering committee for the technologies under the agreement. As of December 31, 2020 and 2019, the NantCell license agreement, effective April 21, 2015, represented $110.0 million of contract liabilities reflected in long-term deferred revenue. See Note 7 In November 2020, the Company was awarded a contract with the Defense Advanced Research Projects Agency (“DARPA Contract”) and co-funded by the Joint Program Executive Office for Chemical, Biological, Radiological and Nuclear Defense, to develop a rapid countermeasure to COVID-19 using gene-encoded neutralizing antibodies. The contract provides SmartPharm Therapeutics, Inc. (“SmartPharm”) funding of up to $34.0 million for the development through Phase II clinical studies of a gene-encoded antibody that could enable from and/or treatment of SARS-CoV-2 infection and COVID-19. The Company recognized $0.2 million in grant revenue associated with the DARPA Contract during the year ended December 31, 2020, which is included within other service revenue. |
Stock-Based Compensation | Stock-Based Compensation The Company estimates the fair value of stock option awards and its ESPP on the grant or offering date using the Black-Scholes option-pricing model. The Black-Scholes option-pricing model requires inputs such as the risk-free interest rate, expected term and expected volatility.Stock-based compensation expense is recognized on a straight-line basis, net of actual forfeitures in the period. |
Comprehensive Loss | Comprehensive Loss Comprehensive loss is primarily comprised of net income (loss) and foreign currency translation adjustments. The Company displays comprehensive loss and its components in its consolidated statements of comprehensive loss. |
Net Income (Loss) per Share | Net Income (Loss) per Share Basic net income (loss) per share is computed by dividing net loss for the period by the weighted average number of shares of common stock outstanding. Diluted net loss per share reflects the additional dilution from potential issuances of common stock, such as stock issuable pursuant to the exercise of stock options or the exercise of outstanding warrants. The treasury stock method and the if-converted method are used to calculate the potential dilutive effect of these common stock equivalents. Potentially dilutive shares are excluded from the computation of diluted net loss per share when their effect is anti-dilutive. In periods where a net loss is presented, all potentially dilutive securities are anti-dilutive and are excluded from the computation of diluted net loss per share. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, In August 2018, the FASB issued ASU No. 2018-13, Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement, In January 2017, the FASB issued ASU No. 2017-04, Simplifying the Test for Goodwill Impairment (Topic 350). This standard eliminates Step 2 from the goodwill impairment test, instead requiring an entity to recognize a goodwill impairment charge for the amount by which the goodwill carrying amount exceeds the reporting unit’s fair value. This update also eliminated the qualitative assessment requirements for a reporting unit with zero or negative carrying value. This guidance was effective for interim and annual goodwill impairment tests in fiscal years beginning after December 15, 2019, with early adoption permitted, and must be applied on a prospective basis. The Company adopted the standard in the first quarter of 2020 with no material impact on the Company’s consolidated financial statements. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. The amendments in this update simplify the accounting for income taxes by removing certain exceptions to the general principles in Accounting Standards Codification (“ASC”) Topic 740. The amendments also improve consistent application of and simplify U.S. GAAP for other areas of ASC Topic 740 by clarifying and amending existing guidance. The amendments in this update are effective for interim and annual periods for the Company beginning after December 15, 2020, with early adoption permitted. The Company has evaluated the changes from the standard update and determined any impacts would be immaterial on its consolidated financial statements. The Company will adopt the new guidance on January 1, 2021. |
Liquidity and Going Concern | Liquidity and Going Concern The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. The Company has negative working capital and recurring losses from operations, recurring negative cash flows from operations and substantial cumulative net losses to date and anticipates that it will continue to do so for the foreseeable future as it continues to identify and invest in advancing product candidates, as well as expanding corporate infrastructure. The Company has plans in place to obtain sufficient additional fundraising to fulfill its operating and capital requirements for the next 12 months. The Company’s plans include continuing to fund its operating losses and capital funding needs through public or private equity or debt financings, strategic collaborations, licensing arrangements, asset sales, government grants or other arrangements. Although management believes such plans, if executed, should provide the Company sufficient financing to meet its needs, successful completion of such plans is dependent on factors outside of the Company’s control. As such, management cannot conclude that such plans will be effectively implemented within one year after the date that the financial statements are issued. As a result, management has concluded that the aforementioned conditions, among others, raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date the financial statements are issued. If the Company is unable to raise additional capital in sufficient amounts or on terms acceptable, the Company may have to significantly delay, scale back or discontinue the development or commercialization of one or more of its product candidates. The Company may also seek collaborators for one or more of its current or future product candidates at an earlier stage than otherwise would be desirable or on terms that are less favorable than might otherwise be available. The consolidated financial statements do not reflect any adjustments that might be necessary if the Company is unable to continue as a going concern. If the Company raises additional funds by issuing equity securities, substantial dilution to existing stockholders would result. If the Company raises additional funds by incurring debt financing, the terms of the debt may involve significant cash payment obligations as well as covenants and specific financial ratios that may restrict the Company’s ability to operate its business. |
Organization and Significant _3
Organization and Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Disaggregation of Revenue | The following table shows revenue disaggregated by product and service type for the years ended December 31, 2020, 2019 and 2018 (in thousands): Years Ended December 31, 2020 2019 2018 Scilex Pharmaceuticals Inc. product sales $ 26,331 $ 21,033 $ 2,606 Other product revenue 297 941 3,267 Net product revenue $ 26,628 $ 21,974 $ 5,873 Concortis Biosystems Corporation 7,730 6,520 5,159 Bioserv Corporation 4,976 2,450 5,992 Joint development agreement — — 3,333 Other service revenue 652 488 836 Service revenue $ 13,358 $ 9,458 $ 15,320 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Assets and Liabilities Measured at Fair Value on Recurring Basis | The following table presents the Company’s financial assets and liabilities that are measured at fair value on a recurring basis (in thousands): Fair Value Measurements at December 31, 2020 Balance Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Cash and cash equivalents $ 56,464 $ 56,464 $ — $ — Total assets $ 56,464 $ 56,464 $ — $ — Liabilities: Derivative liabilities - non-current $ 35,400 $ — $ — $ 35,400 Acquisition consideration payable 398 — — 398 Acquisition consideration payable, non-current 549 — — 549 Total liabilities $ 36,347 $ — $ — $ 36,347 Fair Value Measurements at December 31, 2019 Balance Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Cash and cash equivalents $ 22,521 $ 22,521 $ — $ — Restricted cash 58,248 58,248 — — Total assets $ 80,769 $ 80,769 $ — $ — Liabilities: Derivative liabilities $ 8,800 $ — $ — $ 8,800 Derivative liabilities - non-current 35,000 — — 35,000 Acquisition consideration payable 908 — — 908 Acquisition consideration payable, non-current 39 — — 39 Total liabilities $ 44,747 $ — $ — $ 44,747 |
Liabilities Measured at Fair Value Using Significant Unobservable Inputs (Level 3) | Contingent consideration liabilities and acquisition consideration payable are measured using the income approach and discounting to present value the contingent payments expected to be made based on assessment of the probability that the company would be required to make such future payments. The contingent consideration liabilities and acquisition consideration payable are measured at fair value using significant unobservable inputs (Level 3), which include discount rates and probabilities assigned to scenario outcomes. The following table includes a summary of the changes to contingent consideration liabilities and acquisition consideration payable during the years ended December 31, 2020, 2019 and 2018: (in thousands) Fair Value Balance at December 31, 2017 $ 54,272 Re-measurement of Fair Value 9,644 Settlements of contingent consideration (51,879 ) Balance at December 31, 2018 $ 12,037 Re-measurement of Fair Value (736 ) Settlements of contingent consideration (10,354 ) Balance at December 31, 2019 $ 947 Re-measurement of Fair Value — Settlements of contingent consideration — Balance at December 31, 2020 $ 947 The following table includes a summary of the derivative liabilities measured at fair value using significant unobservable inputs (Level 3) during the years ended December 31, 2020 and 2019: (in thousands) Fair Value Balance at December 31, 2018 $ — Additions 6,996 Re-measurement of Fair Value 36,804 Balance at December 31, 2019 $ 43,800 Additions 8,800 Re-measurement of Fair Value (17,200 ) Balance at December 31, 2020 $ 35,400 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Property Plant And Equipment [Abstract] | |
Summary of Property and Equipment | Property and equipment consisted of the following as of December 31, 2020 and 2019 (in thousands): December 31, 2020 2019 Furniture and fixtures $ 1,349 $ 1,315 Office equipment 280 700 Machinery and lab equipment 41,919 33,192 Leasehold improvements 14,295 13,161 Construction in progress 4,031 3,855 61,874 52,223 Less accumulated depreciation (30,013 ) (22,335 ) $ 31,861 $ 29,888 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Summary of Company's Identifiable Intangible Assets | A summary of the Company’s identifiable intangible assets as of December 31, 2020 and 2019 is as follows (in thousands): December 31, 2020 Weighted Average Amortization Period (Years) Gross Carrying Amount Accumulated Amortization Intangibles, net Customer relationships 6 $ 1,585 $ 1,426 $ 159 Acquired technology 19 3,410 1,236 2,174 Acquired in-process research and development — 28,260 — 28,260 Technology placed in service 15 21,940 3,291 18,649 Patent rights 15 32,720 9,103 23,617 Assembled workforce 5 605 222 383 Internally developed software 1 520 87 433 Total intangible assets $ 89,040 $ 15,365 $ 73,675 December 31, 2019 Weighted Average Amortization Period (Years) Gross Carrying Amount Accumulated Amortization Intangibles, net Customer relationships 6 $ 1,585 $ 1,401 $ 184 Acquired technology 19 3,410 1,060 2,350 Acquired in-process research and development — 14,360 — 14,360 Technology placed in service 15 21,940 1,828 20,112 Patent rights 15 32,720 6,922 25,798 Assembled workforce 5 605 101 504 Total intangible assets $ 74,620 $ 11,312 $ 63,308 |
Schedule of Estimated Future Amortization Expense Related to Intangible Assets | Estimated future amortization expense related to intangible assets, excluding indefinite-lived intangible assets, at December 31, 2020 is as follows (in thousands): Years Ending December 31, Amount 2021 $ 4,400 2022 3,966 2023 3,961 2024 3,870 2025 3,845 Thereafter 25,373 Total $ 45,415 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Long-Term Debt and Unamortized Discount Balances | Borrowings of the Scilex Notes consisted of the following (in thousands): December 31, 2020 2019 Principal $ 151,872 $ 221,666 Unamortized debt discount (51,022 ) (67,839 ) Unamortized debt issuance costs (3,698 ) (4,360 ) Carrying value $ 97,152 $ 149,467 Estimated fair value $ 122,300 $ 150,800 |
Future Minimum Payments under Amended and Restated Loan and Security Agreement | Future minimum payments under the Scilex Notes, based on a percentage of projected net sales of ZTlido are estimated as follows (in thousands): Year Ending December 31, 2021 $ 4,882 2022 5,535 2023 7,233 2024 8,830 2025 10,142 Thereafter 115,250 Total future minimum payments 151,872 Unamortized debt discount (51,022 ) Unamortized capitalized debt issuance costs (3,698 ) Total Scilex Notes 97,152 Current portion (4,881 ) Long-term portion of Scilex Notes $ 92,271 |
Stock Incentive and Employee _2
Stock Incentive and Employee Benefit Plans (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Summary of Stock Option Activity | The following table summarizes stock option activity as of December 31, 2020 under the 2019 Plan and the 2009 Plan, and the changes for the period then ended (dollar values in thousands, other than weighted-average exercise price): Options Outstanding Weighted- Average Exercise Price Aggregate Intrinsic Value Outstanding at December 31, 2019 14,586,661 $ 4.36 — Options Granted 8,435,900 5.73 Options Canceled (2,957,970 ) 4.52 Options Exercised (1,301,671 ) 4.25 Outstanding at December 31, 2020 18,762,920 $ 4.97 $ 40,702 |
Fair Value of Employee Stock Options | The fair value of employee stock options was estimated at the grant date using the following assumptions: Years Ended December 31, 2020 2019 2018 Weighted-average grant date fair value $ 4.54 $ 3.40 $ 3.65 Dividend yield — — — Volatility 105 % 96 % 81 % Risk-free interest rate 0.46 % 2.02 % 2.87 % Expected life of options (years) 5.7 6.0 6.1 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Commitments And Contingencies Disclosure [Abstract] | |
Supplemental Quantitative Information Related to Leases | Supplemental quantitative information related to leases includes the following (in thousands): Year ended December 31, 2020 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash outflows from operating leases $ 9,880 $ 6,935 ROU assets obtained in exchange for new and amended operating lease liabilities $ 1,878 $ 6,777 Weighted average remaining lease term in years 8.4 9.4 Weighted average discount rate 12.2 % 12.2 % |
Schedule of Operating Lease Liability Maturities | Maturities of lease liabilities are as follows (in thousands): Years ending December 31, Operating leases 2021 $ 10,010 2022 10,054 2023 10,285 2024 10,418 2025 9,757 Thereafter 37,586 Total lease payments 88,110 Less imputed interest (34,183 ) Total lease liabilities as of December 31, 2020 $ 53,927 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Schedule of Loss Before Income Tax By Location | Total loss before income taxes summarized by region for the years ended December 31, 2020, 2019 and 2018 is as follows (in thousands): 2020 2019 2018 United States $ (315,516 ) $ (362,776 ) $ (216,098 ) Foreign (908 ) (709 ) (2,702 ) Total $ (316,424 ) $ (363,485 ) $ (218,800 ) |
Schedule of Components of Provision Expense (Benefit) | The components of the provision expense (benefit) were as follows for the years ended December 31, 2020, 2019 and 2018 (in thousands): 2020 2019 2018 Current income tax expense (benefit): Federal $ (19 ) $ (68 ) $ (178 ) State 72 27 23 Foreign 58 (37 ) (44 ) Total current 111 (78 ) (199 ) Deferred income tax expense (benefit): Federal (55,321 ) (53,080 ) (31,042 ) State (2,730 ) (12,173 ) (5,534 ) Foreign (288 ) (154 ) (611 ) Total deferred (58,339 ) (65,407 ) (37,187 ) Changes in tax rate 507 (94 ) (453 ) Changes in valuation allowance 55,707 65,106 31,565 Total income tax benefit from continuing operations $ (2,014 ) $ (473 ) $ (6,274 ) |
Summary of Components of Net Deferred Tax Liabilities and Related Valuation Allowance | The components of the Company’s net deferred tax liabilities and related valuation allowance are as follows as of December 31, 2020 and 2019 (in thousands): 2020 2019 Deferred tax assets: Net operating loss carryforwards $ 134,072 $ 91,376 Deferred revenue 25,456 26,064 Tax credit carryforwards 22,209 17,575 Amortization of intangibles 31,140 26,843 Operating lease liabilities 11,726 12,935 Derivative liability — 4,150 Stock based compensation 5,359 3,593 Accrued expenses and other 36,481 25,958 Total deferred tax assets 266,443 208,494 Less valuation allowance (203,512 ) (148,140 ) Total deferred tax assets 62,931 60,354 Deferred tax liabilities: Investment in common stock (45,507 ) (46,584 ) Operating lease right-of-use assets (9,146 ) (10,888 ) Other (1,925 ) (450 ) Amortization of intangibles (13,274 ) (11,475 ) Total deferred tax liabilities (69,852 ) (69,397 ) Net deferred tax liabilities $ (6,921 ) $ (9,043 ) |
Summary of Reconciliation Between Federal Income Tax and Company Provision for Income Taxes | The reconciliation between U.S. federal income taxes at the statutory rate and the Company’s provision for income taxes are as follows for the years ended December 31, 2020, 2019 and 2018 (in thousands): 2020 2019 2018 Income tax benefit at federal statutory rate $ (66,449 ) $ (76,332 ) $ (46,011 ) Valuation allowance 55,707 65,106 31,565 State, net of federal tax benefit (3,339 ) (8,904 ) (3,075 ) Debt discount and interest limitation 896 7,013 11,357 Income tax credits and incentives (3,685 ) (3,018 ) (3,785 ) Compensation expense 4,446 764 1,309 Acquisition related charges 583 18,811 780 Prior year true-up and carryback 7,790 (187 ) (889 ) Other 2,037 (3,726 ) 2,475 Income tax benefit $ (2,014 ) $ (473 ) $ (6,274 ) |
Summary of Reconciliation of Unrecognized Tax Expense (Benefits) | A reconciliation of the beginning and ending amount of unrecognized tax expense (benefits) is as follows for the years ended December 31, 2020, 2019 and 2018 (in thousands): 2020 2019 2018 Beginning balance $ 5,336 $ 4,352 $ 3,883 Increase related to prior year tax positions 133 257 150 Decrease related to prior year tax positions 0 (7 ) (597 ) Increase related to current year tax positions 928 734 916 Ending balance $ 6,397 $ 5,336 $ 4,352 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
Summary of Information by Reportable Segments | The following table presents information about the Company’s reportable segments for the twelve months ended December 31, 2020, 2019 and 2018 (in thousands): Twelve Months Ended December 31, 2020 2019 2018 (in thousands) Sorrento Therapeutics Scilex Total Sorrento Therapeutics Scilex Total Sorrento Therapeutics Scilex Total External revenues $ 13,655 $ 26,331 $ 39,986 $ 10,399 $ 21,033 $ 31,432 $ 18,587 $ 2,606 $ 21,193 Operating expenses 225,687 58,817 284,504 130,529 160,296 290,825 137,166 34,452 171,618 Operating (loss) income (212,032 ) (32,486 ) (244,518 ) (120,130 ) (139,263 ) (259,393 ) (118,579 ) (31,846 ) (150,425 ) Unrestricted cash 51,475 4,989 56,464 12,176 10,345 22,521 86,024 72,714 158,738 |
Quarterly Financial Data (Una_2
Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Financial Data | The following table sets forth selected quarterly data for the years presented, in thousands, except per share data. Quarter Ended Quarter Ended Quarter Ended Quarter Ended Year Ended 2020 December 31, September 30, June 30, March 31, December 31, Revenues $ 11,505 $ 11,753 $ 9,007 $ 7,721 $ 39,986 Operating costs and expenses $ 82,028 $ 94,857 $ 56,735 $ 50,884 $ 284,504 Net loss attributable to Sorrento $ (71,503 ) $ (84,023 ) $ (77,740 ) $ (65,195 ) $ (298,461 ) Net loss per share - basic $ (0.27 ) $ (0.33 ) $ (0.36 ) $ (0.36 ) $ (1.30 ) Net loss per share - diluted $ (0.27 ) $ (0.33 ) $ (0.36 ) $ (0.36 ) $ (1.30 ) Weighted-average shares - basic 267,863 251,211 216,956 182,609 229,823 Weighted-average shares - diluted 267,863 257,670 216,956 182,609 229,823 Quarter Ended Quarter Ended Quarter Ended Quarter Ended Year Ended 2019 December 31, September 30, June 30, March 31, December 31, Revenues $ 13,034 $ 5,778 $ 6,477 $ 6,143 $ 31,432 Operating costs and expenses $ 45,613 $ 59,061 $ 56,838 $ 129,313 $ 290,825 Net loss attributable to Sorrento $ (62,820 ) $ (64,415 ) $ (56,762 ) $ (108,071 ) $ (292,068 ) Net loss per share - basic $ (0.41 ) $ (0.49 ) $ (0.46 ) $ (0.88 ) $ (2.20 ) Net loss per share - diluted $ (0.41 ) $ (0.50 ) $ (0.47 ) $ (0.88 ) $ (2.35 ) Weighted-average shares - basic 154,964 130,800 122,549 122,281 132,732 Weighted-average shares - diluted 154,964 140,445 132,459 122,281 140,514 |
Loss Per Share (Tables)
Loss Per Share (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Reconciliation of Basic and Diluted Earnings Per Share | The following table sets forth the reconciliation of basic and diluted earnings per share for the years ended December 31, 2020, 2019 and 2018 (in thousands, except per share): Years Ended December 31, 2020 2019 2018 Numerator Net loss attributable to Sorrento $ (298,461 ) $ (292,068 ) $ (203,540 ) Net loss attributable to Semnur holders of Scilex Holding — (38,669 ) — Net loss used for diluted earnings per share (298,461 ) (330,737 ) (203,540 ) Denominator for basic loss per share 229,823 132,732 106,150 Potentially dilutive shares of Sorrento common stock issuable upon Semnur Share Exchange — 7,782 — Denominator for loss earnings per share 229,823 140,514 106,150 Basic loss per share $ (1.30 ) $ (2.20 ) $ (1.92 ) Diluted loss per share $ (1.30 ) $ (2.35 ) $ (1.92 ) |
Components of Outstanding Securities | The potentially dilutive stock options and warrants that would have been excluded because the effect would have been anti-dilutive consisted of the following (in thousands): Years Ended December 31, 2020 2019 2018 Outstanding options 18,763 14,587 10,523 Outstanding warrants 18,605 57,556 25,635 |
Organization and Significant _4
Organization and Significant Accounting Policies - Additional Information (Details) - USD ($) | Sep. 26, 2017 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Nov. 30, 2020 |
Significant Accounting Policies [Line Items] | |||||||||||||
Restricted cash | $ 0 | $ 58,248,000 | $ 0 | $ 58,248,000 | $ 54,592,000 | ||||||||
Restricted cash | 13,098,000 | 13,098,000 | |||||||||||
Restricted cash | 45,150,000 | 45,150,000 | |||||||||||
Net inventory | 1,831,000 | 3,362,000 | 1,831,000 | 3,362,000 | |||||||||
Goodwill impairment | 0 | 0 | 0 | ||||||||||
Impairment losses of long-lived assets | 0 | ||||||||||||
External revenues | 11,505,000 | $ 11,753,000 | $ 9,007,000 | $ 7,721,000 | 13,034,000 | $ 5,778,000 | $ 6,477,000 | $ 6,143,000 | 39,986,000 | 31,432,000 | 21,193,000 | ||
Deferred revenue | $ 113,185,000 | 114,389,000 | $ 113,185,000 | 114,389,000 | |||||||||
ASU 2016-13 | |||||||||||||
Significant Accounting Policies [Line Items] | |||||||||||||
Change in Accounting Principle, Accounting Standards Update, Adopted [true false] | true | true | |||||||||||
Change in Accounting Principle, Accounting Standards Update, Adoption Date | Jan. 1, 2020 | Jan. 1, 2020 | |||||||||||
Change in Accounting Principle, Accounting Standards Update, Immaterial Effect [true false] | true | true | |||||||||||
ASU 2018-13 | |||||||||||||
Significant Accounting Policies [Line Items] | |||||||||||||
Change in Accounting Principle, Accounting Standards Update, Adopted [true false] | true | true | |||||||||||
Change in Accounting Principle, Accounting Standards Update, Immaterial Effect [true false] | true | true | |||||||||||
ASU 2017-04 | |||||||||||||
Significant Accounting Policies [Line Items] | |||||||||||||
Change in Accounting Principle, Accounting Standards Update, Adopted [true false] | true | true | |||||||||||
Change in Accounting Principle, Accounting Standards Update, Immaterial Effect [true false] | true | true | |||||||||||
Change in Accounting Principle, Accounting Standards Update, Early Adoption [true false] | true | true | |||||||||||
Sale And Service, Drug and Reagents | |||||||||||||
Significant Accounting Policies [Line Items] | |||||||||||||
Remaining performance obligation | $ 3,400,000 | 2,200,000 | $ 3,400,000 | 2,200,000 | |||||||||
Sale And Service, Joint Development | |||||||||||||
Significant Accounting Policies [Line Items] | |||||||||||||
Remaining performance obligation | $ 5,000,000 | ||||||||||||
Proceeds from customers | $ 5,000,000 | ||||||||||||
External revenues | $ 0 | 0 | $ 3,300,000 | ||||||||||
Royalty And License | |||||||||||||
Significant Accounting Policies [Line Items] | |||||||||||||
Estimated license contract term based on expected life of patent | 20 years | ||||||||||||
Royalty And License | ImmuneOncia Therapeutics, LLC | |||||||||||||
Significant Accounting Policies [Line Items] | |||||||||||||
Remaining performance obligation | 7,500,000 | $ 7,500,000 | |||||||||||
Proceeds from customers | 9,600,000 | ||||||||||||
Remaining performance obligation expected to be recognized in the next twelve months | 500,000 | 500,000 | |||||||||||
Royalty And License | Nant Cell | |||||||||||||
Significant Accounting Policies [Line Items] | |||||||||||||
Deferred revenue | $ 110,000,000 | 110,000,000 | 110,000,000 | 110,000,000 | |||||||||
SmartPharm Therapeutics, Inc. | |||||||||||||
Significant Accounting Policies [Line Items] | |||||||||||||
Maximum amount for development through Phase II Clinical Studies of Gene-encoded antibody | $ 34,000,000 | ||||||||||||
DARPA Contract | |||||||||||||
Significant Accounting Policies [Line Items] | |||||||||||||
External revenues | $ 200,000 | ||||||||||||
Minimum | |||||||||||||
Significant Accounting Policies [Line Items] | |||||||||||||
Estimated useful life of fixed asset | 3 years | ||||||||||||
Maximum | |||||||||||||
Significant Accounting Policies [Line Items] | |||||||||||||
Estimated useful life of fixed asset | 5 years | ||||||||||||
Oaktree Term Loan | Oaktree Capital Management, L.P. | |||||||||||||
Significant Accounting Policies [Line Items] | |||||||||||||
Restricted cash | 13,100,000 | 13,100,000 | |||||||||||
Scilex Notes | Scilex Pharmaceuticals, Inc | Senior Notes | |||||||||||||
Significant Accounting Policies [Line Items] | |||||||||||||
Restricted cash | $ 45,000,000 | $ 45,000,000 |
Organization and Significant _5
Organization and Significant Accounting Policies - Schedule of Revenues by Category (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | $ 11,505 | $ 11,753 | $ 9,007 | $ 7,721 | $ 13,034 | $ 5,778 | $ 6,477 | $ 6,143 | $ 39,986 | $ 31,432 | $ 21,193 |
Scilex Pharmaceuticals Inc. Product Sales | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 26,331 | 21,033 | 2,606 | ||||||||
Other product Revenue | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 297 | 941 | 3,267 | ||||||||
Product | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 26,628 | 21,974 | 5,873 | ||||||||
Concortis Biosystems Corporation | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 7,730 | 6,520 | 5,159 | ||||||||
Bioserv Corporation | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 4,976 | 2,450 | 5,992 | ||||||||
Joint development agreement | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 3,333 | ||||||||||
Other Service Revenue | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | 652 | 488 | 836 | ||||||||
Service revenue | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues | $ 13,358 | $ 9,458 | $ 15,320 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Financial Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Assets: | ||
Total assets | $ 56,464 | $ 80,769 |
Liabilities: | ||
Total liabilities | 36,347 | 44,747 |
Derivative liabilities - non-current | ||
Liabilities: | ||
Total liabilities | 35,400 | 35,000 |
Acquisition consideration payable | ||
Liabilities: | ||
Total liabilities | 398 | 908 |
Acquisition consideration payable, non-current | ||
Liabilities: | ||
Total liabilities | 549 | 39 |
Derivative liabilities | ||
Liabilities: | ||
Total liabilities | 8,800 | |
Quoted Prices in Active Markets (Level 1) | ||
Assets: | ||
Total assets | 56,464 | 80,769 |
Liabilities: | ||
Total liabilities | 0 | 0 |
Quoted Prices in Active Markets (Level 1) | Derivative liabilities - non-current | ||
Liabilities: | ||
Total liabilities | 0 | 0 |
Quoted Prices in Active Markets (Level 1) | Acquisition consideration payable | ||
Liabilities: | ||
Total liabilities | 0 | 0 |
Quoted Prices in Active Markets (Level 1) | Acquisition consideration payable, non-current | ||
Liabilities: | ||
Total liabilities | 0 | 0 |
Quoted Prices in Active Markets (Level 1) | Derivative liabilities | ||
Liabilities: | ||
Total liabilities | 0 | |
Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Total assets | 0 | 0 |
Liabilities: | ||
Total liabilities | 0 | 0 |
Significant Other Observable Inputs (Level 2) | Derivative liabilities - non-current | ||
Liabilities: | ||
Total liabilities | 0 | 0 |
Significant Other Observable Inputs (Level 2) | Acquisition consideration payable | ||
Liabilities: | ||
Total liabilities | 0 | 0 |
Significant Other Observable Inputs (Level 2) | Acquisition consideration payable, non-current | ||
Liabilities: | ||
Total liabilities | 0 | 0 |
Significant Other Observable Inputs (Level 2) | Derivative liabilities | ||
Liabilities: | ||
Total liabilities | 0 | |
Significant Unobservable Inputs (Level 3) | ||
Assets: | ||
Total assets | 0 | 0 |
Liabilities: | ||
Total liabilities | 36,347 | 44,747 |
Significant Unobservable Inputs (Level 3) | Derivative liabilities - non-current | ||
Liabilities: | ||
Total liabilities | 35,400 | 35,000 |
Significant Unobservable Inputs (Level 3) | Acquisition consideration payable | ||
Liabilities: | ||
Total liabilities | 398 | 908 |
Significant Unobservable Inputs (Level 3) | Acquisition consideration payable, non-current | ||
Liabilities: | ||
Total liabilities | 549 | 39 |
Significant Unobservable Inputs (Level 3) | Derivative liabilities | ||
Liabilities: | ||
Total liabilities | 8,800 | |
Cash and cash equivalents | ||
Assets: | ||
Total assets | 56,464 | 22,521 |
Cash and cash equivalents | Quoted Prices in Active Markets (Level 1) | ||
Assets: | ||
Total assets | 56,464 | 22,521 |
Cash and cash equivalents | Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Total assets | 0 | 0 |
Cash and cash equivalents | Significant Unobservable Inputs (Level 3) | ||
Assets: | ||
Total assets | $ 0 | 0 |
Restricted cash | ||
Assets: | ||
Total assets | 58,248 | |
Restricted cash | Quoted Prices in Active Markets (Level 1) | ||
Assets: | ||
Total assets | 58,248 | |
Restricted cash | Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Total assets | 0 | |
Restricted cash | Significant Unobservable Inputs (Level 3) | ||
Assets: | ||
Total assets | $ 0 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) $ in Thousands | May 03, 2019USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) |
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||||
Re-measurement of Fair Value | $ (736) | $ 9,644 | ||
(Gain) related to the settlement of acquisition consideration payable | (2,020) | |||
Settlement of contingent consideration | 10,354 | 51,879 | ||
Gain (loss) on derivative liabilities | $ 6,600 | (36,792) | 2,830 | |
Debt discount | 7,000 | |||
2019 Warrants | ||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||||
Loss on derivative liability | $ 4,300 | |||
Early Conditional Loan | ||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||||
Loss on derivative liability | $ 1,800 | |||
Revenue Multiple | ||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||||
Derivative liability, measurement input | 1 | |||
Revenue Multiple | Minimum | ||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||||
Derivative liability, measurement input | 0.55 | |||
Revenue Multiple | Maximum | ||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||||
Derivative liability, measurement input | 1 | |||
Scilex Notes | Risk Adjusted Net Sales Forecast | ||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||||
Derivative liability, measurement input | 0.07 | 0.08 | ||
Scilex Notes | Effective Debt Yield | ||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||||
Derivative liability, measurement input | 0.15 | 0.197 | ||
Scilex Pharmaceuticals, Inc | ||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||||
Settlement of contingent consideration | 38,200 | |||
TNK Therapeutics | Membership interest purchase agreement | CARgenix Holding LLC | ||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||||
Settlement of contingent consideration | 2,300 | |||
TNK Therapeutics | Virttu Biologics Limited | ||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||||
(Gain) related to the settlement of acquisition consideration payable | $ (10,400) | |||
Settlement of contingent consideration | 11,300 | |||
Acquisition Consideration | ||||
Fair Value Assets Measured On Recurring Basis Unobservable Input Reconciliation [Line Items] | ||||
Re-measurement of Fair Value | $ 700 | $ (9,600) |
Fair Value Measurements - Summa
Fair Value Measurements - Summary of Contingent Consideration Liabilities and Acquisition Consideration Payable are Measured at Fair Value Using Significant Unobservable Inputs (Level 3) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |||
Beginning balance | $ 947 | $ 12,037 | $ 54,272 |
Re-measurement of Fair Value | (736) | 9,644 | |
Settlements of contingent consideration | (10,354) | (51,879) | |
Ending balance | $ 947 | $ 947 | $ 12,037 |
Fair Value Measurements - Sum_2
Fair Value Measurements - Summary of Derivative Liabilities Measured at Fair Value Using Significant Unobservable Inputs (Level 3) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Beginning balance | $ 947 | $ 12,037 | $ 54,272 |
Re-measurement of Fair Value | 736 | (9,644) | |
Ending balance | 947 | 947 | 12,037 |
Derivative Liabilities | |||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | |||
Beginning balance | 43,800 | 0 | |
Additions | 8,800 | 6,996 | |
Re-measurement of Fair Value | (17,200) | 36,804 | |
Ending balance | $ 35,400 | $ 43,800 | $ 0 |
Property and Equipment - Summar
Property and Equipment - Summary of Property and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, total | $ 61,874 | $ 52,223 |
Less accumulated depreciation | (30,013) | (22,335) |
Property and equipment, net | 31,861 | 29,888 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, total | 1,349 | 1,315 |
Office equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, total | 280 | 700 |
Machinery and lab equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, total | 41,919 | 33,192 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, total | 14,295 | 13,161 |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, total | $ 4,031 | $ 3,855 |
Property and Equipment - Additi
Property and Equipment - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Property Plant And Equipment [Abstract] | |||
Depreciation expense | $ 7 | $ 7 | $ 6 |
Investments - Additional Inform
Investments - Additional Information (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Investments Debt And Equity Securities [Abstract] | |
Equity method investment, impairment losses | $ 3.8 |
Investments - NANTibody - Addit
Investments - NANTibody - Additional Information (Details) - USD ($) | 12 Months Ended | ||||||
Dec. 31, 2020 | Sep. 30, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Apr. 30, 2015 | |
Schedule Of Equity Method Investments [Line Items] | |||||||
Equity method investments | $ 256,397,000 | $ 262,241,000 | |||||
Net loss | (314,410,000) | (363,012,000) | $ (212,526,000) | ||||
Current assets of equity method investment | 86,234,000 | 67,588,000 | |||||
Current liabilities of equity method investment | 96,480,000 | 115,206,000 | |||||
NANTibody | |||||||
Schedule Of Equity Method Investments [Line Items] | |||||||
Equity method investment ownership percentage | 40.00% | ||||||
Equity method investments | $ 500,000 | $ 2,500,000 | |||||
Net loss | $ (100,000) | $ (2,400,000) | $ (700,000) | ||||
Current assets of equity method investment | 4,900,000 | 7,300,000 | |||||
Current liabilities of equity method investment | 3,500,000 | 1,000,000 | |||||
Noncurrent assets of equity method investment | 200,000 | 200,000 | |||||
Noncurrent liabilities of equity method investment | $ 0 | $ 0 | |||||
NANTibody | Nant Cell | |||||||
Schedule Of Equity Method Investments [Line Items] | |||||||
Equity method investment ownership percentage | 60.00% |
Investments - NantStem - Additi
Investments - NantStem - Additional Information (Details) - USD ($) | 12 Months Ended | ||||
Dec. 31, 2020 | Sep. 30, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Schedule Of Equity Method Investments [Line Items] | |||||
Equity method investments | $ 256,397,000 | $ 262,241,000 | |||
Net loss | (314,410,000) | (363,012,000) | $ (212,526,000) | ||
Current assets of equity method investment | 86,234,000 | 67,588,000 | |||
Current liabilities of equity method investment | $ 96,480,000 | 115,206,000 | |||
Nant Cancer Stem LLC | |||||
Schedule Of Equity Method Investments [Line Items] | |||||
Equity method investment ownership percentage | 20.00% | ||||
Equity method investments | $ 18,100,000 | $ 17,900,000 | |||
Net loss | $ 100,000 | $ (900,000) | |||
Current assets of equity method investment | 80,000,000 | 75,900,000 | |||
Current liabilities of equity method investment | 0 | 200,000 | |||
Noncurrent assets of equity method investment | 1,700,000 | 4,700,000 | |||
Noncurrent liabilities of equity method investment | $ 0 | $ 0 | |||
Loss on equity investments | $ 500,000 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Additional Information (Details) | 12 Months Ended | ||
Dec. 31, 2020USD ($)segment | Dec. 31, 2019USD ($)segment | Dec. 31, 2018USD ($) | |
Goodwill And Intangible Assets [Line Items] | |||
Goodwill | $ 43,554,000 | $ 38,298,000 | |
Goodwill, period increase (decrease) | 5,300,000 | ||
Goodwill impairment | $ 0 | $ 0 | $ 0 |
Number of operating segments | segment | 2 | 2 | |
Indefinite-lived intangible assets | $ 28,300,000 | ||
Intangible amortization | 4,053,000 | $ 3,941,000 | $ 3,009,000 |
Impairment losses of long-lived assets | $ 0 | ||
Weighted average | |||
Goodwill And Intangible Assets [Line Items] | |||
Identifiable intangible assets, weighted average life | 10 years | ||
Sorrento Therapeutics | |||
Goodwill And Intangible Assets [Line Items] | |||
Goodwill | $ 36,900,000 | ||
Scilex Pharmaceuticals, Inc | |||
Goodwill And Intangible Assets [Line Items] | |||
Goodwill | 6,700,000 | ||
Scilex Pharmaceuticals, Inc | Acquired in-process research and development | |||
Goodwill And Intangible Assets [Line Items] | |||
Impairment losses of long-lived assets | $ 1,800,000 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Summary of Company's Identifiable Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Finite Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 89,040 | $ 74,620 |
Accumulated Amortization | 15,365 | 11,312 |
Intangibles, net | $ 73,675 | $ 63,308 |
Customer relationships | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Amortization Period (Years) | 6 years | 6 years |
Gross Carrying Amount | $ 1,585 | $ 1,585 |
Accumulated Amortization | 1,426 | 1,401 |
Intangibles, net | $ 159 | $ 184 |
Acquired developed technology | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Amortization Period (Years) | 19 years | 19 years |
Gross Carrying Amount | $ 3,410 | $ 3,410 |
Accumulated Amortization | 1,236 | 1,060 |
Intangibles, net | $ 2,174 | $ 2,350 |
Acquired in-process research and development | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Amortization Period (Years) | 0 years | 0 years |
Gross Carrying Amount | $ 28,260 | $ 14,360 |
Intangibles, net | $ 28,260 | $ 14,360 |
Technology placed in service | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Amortization Period (Years) | 15 years | 15 years |
Gross Carrying Amount | $ 21,940 | $ 21,940 |
Accumulated Amortization | 3,291 | 1,828 |
Intangibles, net | $ 18,649 | $ 20,112 |
Patent rights | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Amortization Period (Years) | 15 years | 15 years |
Gross Carrying Amount | $ 32,720 | $ 32,720 |
Accumulated Amortization | 9,103 | 6,922 |
Intangibles, net | $ 23,617 | $ 25,798 |
Assembled workforce | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Amortization Period (Years) | 5 years | 5 years |
Gross Carrying Amount | $ 605 | $ 605 |
Accumulated Amortization | 222 | 101 |
Intangibles, net | $ 383 | $ 504 |
Internally developed software | ||
Finite Lived Intangible Assets [Line Items] | ||
Weighted Average Amortization Period (Years) | 1 year | |
Gross Carrying Amount | $ 520 | |
Accumulated Amortization | 87 | |
Intangibles, net | $ 433 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Schedule of Estimated Future Amortization Expense Related to Intangible Assets (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Goodwill And Intangible Assets Disclosure [Abstract] | |
2021 | $ 4,400 |
2022 | 3,966 |
2023 | 3,961 |
2024 | 3,870 |
2025 | 3,845 |
Thereafter | 25,373 |
Total | $ 45,415 |
Significant Agreements and Co_2
Significant Agreements and Contracts - Acquisition of SmartPharm Therapeutics, Inc. - Additional Information (Details) - USD ($) $ in Thousands, shares in Millions | Sep. 01, 2020 | Dec. 31, 2020 | Dec. 31, 2019 |
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |||
Goodwill | $ 43,554 | $ 38,298 | |
SmartPharm | |||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |||
Consideration transferred | $ 19,500 | ||
Stock consideration value | 1.8 | ||
Purchase price allocation resulted in net identifiable assets | $ 19,500 | ||
Purchase price allocation resulted in net identifiable assets, indefinite lived intangible assets | 13,900 | ||
Goodwill | 5,300 | ||
Purchase price allocation resulted in net identifiable assets, other net assets | $ 300 |
Significant Agreements and Co_3
Significant Agreements and Contracts - Acquisition of Semnur Pharmaceuticals - Additional Information (Details) - USD ($) | Jan. 29, 2021 | Sep. 28, 2020 | Mar. 18, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Oct. 09, 2020 |
Semnur Cash Exchange Payment | ||||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||||||
Stock consideration value | $ 55,000,000 | |||||
Percentage of outstanding common stock held | 82.30% | |||||
Semnur Cash Exchange Payment | Subsequent Event | ||||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||||||
Percentage of outstanding common stock held | 99.90% | |||||
Semnur | ||||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||||||
Consideration transferred | $ 70,000,000 | |||||
Cash consideration | 15,000,000 | |||||
Stock consideration value | 55,000,000 | |||||
Asset acquisition, transaction costs | 3,100,000 | |||||
Asset acquisition, liabilities assumed | $ 4,200,000 | |||||
Percentage of shares acquired | 58.00% | |||||
Eligible percentage of equity interest acquired by third party to exchange share | 100.00% | |||||
Share exchange period | 60 days | |||||
Trailing volume weighted average share price, term | 30 days | |||||
Stock consideration value per share (usd per share) | $ 5.55 | |||||
Cash consideration to equity holders | $ 55,000,000 | |||||
Stock consideration common stock value | $ 55,000,000 | |||||
Contingent consideration, liability | $ 0 | $ 0 | ||||
Acquired in-process research and development | $ 75,300,000 | |||||
Semnur | Milestones Achievement | ||||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||||||
Additional cash consideration upon certain milestones | $ 280,000,000 | |||||
Semnur | New Drug Application, First Approval | ||||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||||||
Asset acquisition, contingent consideration arrangements | 40,000,000 | |||||
Semnur | Cumulative Net Sales, $100 million | ||||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||||||
Asset acquisition, contingent consideration arrangements | 20,000,000 | |||||
Asset acquisition, contingent consideration arrangements, cumulative net sales threshold | 100,000,000 | |||||
Semnur | Cumulative Net Sales, $250 million | ||||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||||||
Asset acquisition, contingent consideration arrangements | 20,000,000 | |||||
Asset acquisition, contingent consideration arrangements, cumulative net sales threshold | 250,000,000 | |||||
Semnur | Cumulative Net Sales, $500 million | ||||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||||||
Asset acquisition, contingent consideration arrangements | 50,000,000 | |||||
Asset acquisition, contingent consideration arrangements, cumulative net sales threshold | 500,000,000 | |||||
Semnur | Cumulative Net Sales, $750 million | ||||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||||||
Asset acquisition, contingent consideration arrangements | 150,000,000 | |||||
Asset acquisition, contingent consideration arrangements, cumulative net sales threshold | $ 750,000,000 |
Significant Agreements and Co_4
Significant Agreements and Contracts - Acquisition of Sofusa - Additional Information (Details) | 1 Months Ended | 12 Months Ended | ||
Jul. 31, 2018USD ($)product | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | |
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||||
Acquired in-process research and development | $ 42,992,000 | $ 75,301,000 | $ 9,895,000 | |
Property and equipment | 61,874,000 | 52,223,000 | ||
Construction in progress | ||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||||
Property and equipment | 4,031,000 | $ 3,855,000 | ||
Sofusa | ||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||||
Total purchase consideration | $ 10,000,000 | |||
Number of products developed for royalty payment | product | 5 | |||
Sofusa | Construction in progress | ||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||||
Property and equipment | 500,000 | |||
Sofusa | Milestones Achievement | ||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||||
Contingent consideration payable | $ 300,000,000 | |||
Contingent consideration, liability | $ 0 | |||
Acquired in-process research and development | $ 9,500,000 |
Significant Agreements and Co_5
Significant Agreements and Contracts - License Agreement with ACEA Therapeutics, Inc - Additional Information (Details) - License Agreement - USD ($) $ in Millions | 1 Months Ended | |
Oct. 31, 2020 | Jul. 31, 2020 | |
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||
Up-front license fee | $ 3.5 | $ 15 |
Minimum | ||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||
Percentage of upfront payment or milestone payment comprised of common stock | 50.00% |
Significant Agreements and Co_6
Significant Agreements and Contracts - License Agreement with The Trustees of Columbia University in the City of New York - Additional Information (Details) - Columbia License Agreement - License Agreement $ in Millions | 1 Months Ended |
Jul. 31, 2020USD ($) | |
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |
Up-front license fee payable within ten business days | $ 5 |
Minimum annual royalty payments | $ 1 |
Significant Agreements and Co_7
Significant Agreements and Contracts - License Agreement with Mayo Foundation - Additional Information (Details) - License Agreement - USD ($) $ in Millions | 1 Months Ended | ||
Oct. 31, 2020 | Sep. 30, 2020 | Jul. 31, 2020 | |
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |||
Up-front license fee | $ 3.5 | $ 15 | |
Mayo | |||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |||
Up-front license fee | $ 9.3 | ||
Cash consideration to equity holders | $ 2.3 | ||
Stock consideration shares | 996,803 | ||
Mayo | Preclinical and Clinical Research Expenses | Maximum | |||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |||
Acquired in-process research and development | $ 3.4 | ||
Mayo | Development and manufacturing expenses | |||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |||
Acquired in-process research and development | $ 2 |
Significant Agreements and Co_8
Significant Agreements and Contracts - License Agreement with Personalized Stem Cells, Inc - Additional Information (Details) - USD ($) $ in Millions | 1 Months Ended | |
Oct. 31, 2020 | Jul. 31, 2020 | |
License Agreement | ||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||
Up-front license fee | $ 3.5 | $ 15 |
Significant Agreements and Co_9
Significant Agreements and Contracts - License Agreement with NantCell - Additional Information (Details) - Nant Cell - USD ($) $ in Millions | 1 Months Ended | |
Apr. 30, 2015 | Dec. 31, 2020 | |
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||
Upfront payment received from customers | $ 10 | |
Common stock received (in shares) | 10,000,000 | |
Vested equity received | $ 100 | |
Cost-method investments, aggregate carrying amount | $ 100 | |
Maximum | ||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | ||
Royalty rate percent of net sales | (5.00%) |
Significant Agreements and C_10
Significant Agreements and Contracts - Short-Term Loans - Additional Information (Details) $ in Thousands, ¥ in Millions | 1 Months Ended | 12 Months Ended | |||
Nov. 30, 2019USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Nov. 30, 2019CNY (¥) | |
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |||||
Short-term working capital funding arrangements, net of issuance costs | $ 18,587 | $ 8,000 | $ 21,261 | ||
Bridge Loan | |||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |||||
Debt instrument collateral fee, annual rate | 5.00% | ||||
Repayments of arrangements | $ 8,000 | ||||
Bridge Loan | Collateral Pledged | |||||
Research and Development Arrangement, Contract to Perform for Others [Line Items] | |||||
Collateral amount | $ 8,500 | ¥ 60 |
Debt - 2018 Purchase Agreement
Debt - 2018 Purchase Agreement and Indenture for Scilex - Additional Information (Details) - USD ($) | Dec. 14, 2020 | Sep. 07, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Apr. 30, 2021 | Feb. 12, 2021 | Dec. 16, 2020 |
Debt Instrument [Line Items] | ||||||||
Proceeds from issuance of senior long-term debt | $ 134,275,000 | |||||||
Standby Letters of Credit | ||||||||
Debt Instrument [Line Items] | ||||||||
Maximum exposure under guarantor obligations | $ 35,000,000 | |||||||
Scilex Pharmaceuticals, Inc | ||||||||
Debt Instrument [Line Items] | ||||||||
Release of restricted funds held in reserve and collateral account | $ 45,000,000 | |||||||
Principal amount to be purchased | $ 45,000,000 | |||||||
Purchase price, percentage of principal amount | 100.00% | |||||||
Minimum cash covenant | $ 4,000,000 | |||||||
Cash purchase price, percentage of principal amount | 100.00% | |||||||
Scilex Pharmaceuticals, Inc | Scenario Forecast | ||||||||
Debt Instrument [Line Items] | ||||||||
Minimum cash covenant | $ 10,000,000 | |||||||
Scilex Pharmaceuticals, Inc | Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Principal amount to be purchased | $ 20,000,000 | |||||||
Indebtedness in connection with an accounts receivable revolving loan facility | 10,000,000 | |||||||
Scilex Pharmaceuticals, Inc | If Letter of Credit is Drawn On | ||||||||
Debt Instrument [Line Items] | ||||||||
Principal amount to be purchased | 25,000,000 | |||||||
Scilex Pharmaceuticals, Inc | If Scilex Does Not Receive Marketing Approval Letter On or Prior to July 1, 2023 | ||||||||
Debt Instrument [Line Items] | ||||||||
Principal amount to be purchased | $ 20,000,000 | |||||||
Scilex Pharmaceuticals, Inc | December Optional Repurchase | ||||||||
Debt Instrument [Line Items] | ||||||||
Cash purchase price, percentage of principal amount | 100.00% | |||||||
Scilex Pharmaceuticals, Inc | December Optional Repurchase | Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Principal amount to be purchased | $ 20,000,000 | |||||||
Scilex Pharmaceuticals, Inc | February Optional Repurchase | ||||||||
Debt Instrument [Line Items] | ||||||||
Cash purchase price, percentage of principal amount | 100.00% | |||||||
Scilex Pharmaceuticals, Inc | February Optional Repurchase | Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Principal amount to be purchased | $ 20,000,000 | |||||||
Scilex Pharmaceuticals, Inc | April Optional Repurchase | ||||||||
Debt Instrument [Line Items] | ||||||||
Cash purchase price, percentage of principal amount | 100.00% | |||||||
Scilex Pharmaceuticals, Inc | April Optional Repurchase | Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Principal amount to be purchased | $ 20,000,000 | |||||||
Senior Notes | Scilex Pharmaceuticals, Inc | Senior Secured Notes, Due 2026 | ||||||||
Debt Instrument [Line Items] | ||||||||
Face value of loan | 224,000,000 | $ 151,872,000 | $ 221,666,000 | |||||
Proceeds from issuance of senior long-term debt | 140,000,000 | |||||||
Net proceeds after deducting offering expenses and funding reserves and collateral | 89,300,000 | |||||||
Segregated reserve account funding | 20,000,000 | |||||||
Segregated collateral account funding | $ 25,000,000 | |||||||
Reduction to aggregate principal amount | $ 65,000,000 | |||||||
Debt instrument, interest rate, effective percentage | 9.15% | |||||||
Amount of debt discount and debt issuance included in interest expense | $ 10,600,000 | 15,000,000 | $ 6,800,000 | |||||
Principal payments | $ 69,800,000 | $ 2,300,000 | ||||||
Senior Notes | Scilex Pharmaceuticals, Inc | Senior Secured Notes, Due 2026 | Subsequent Event | ||||||||
Debt Instrument [Line Items] | ||||||||
Face value of loan | $ 20,000,000 | |||||||
Senior Notes | Scilex Pharmaceuticals, Inc | Senior Secured Notes, Due 2026 | ZTlido | ||||||||
Debt Instrument [Line Items] | ||||||||
Percentage of outstanding principal holders can declare debt payable upon default | 25.00% | |||||||
Percentage of outstanding payable due upon default | 100.00% | |||||||
Compensating balance | $ 35,000,000 | |||||||
Contingent liability | $ 25,000,000 | |||||||
Percentage of principal amount outstanding holders need as an acceptance to replace letter of credit | 80.00% | |||||||
Senior Notes | Scilex Pharmaceuticals, Inc | Senior Secured Notes, Due 2026 | February 15, 2019 - March 31, 2021 | ZTlido | Minimum | ||||||||
Debt Instrument [Line Items] | ||||||||
Quarterly principal payment as a percentage of net sales | 10.00% | |||||||
Senior Notes | Scilex Pharmaceuticals, Inc | Senior Secured Notes, Due 2026 | February 15, 2019 - March 31, 2021 | ZTlido | Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Quarterly principal payment as a percentage of net sales | 20.00% | |||||||
Senior Notes | Scilex Pharmaceuticals, Inc | Senior Secured Notes, Due 2026 | Market approval by March 31, 2021 | ZTlido | ||||||||
Debt Instrument [Line Items] | ||||||||
Redemption price as a percentage of outstanding principal | 101.00% | |||||||
Senior Notes | Scilex Pharmaceuticals, Inc | Senior Secured Notes, Due 2026 | Market approval by March 31, 2021 | ZTlido | Minimum | ||||||||
Debt Instrument [Line Items] | ||||||||
Quarterly principal payment as a percentage of net sales | 15.00% | |||||||
Senior Notes | Scilex Pharmaceuticals, Inc | Senior Secured Notes, Due 2026 | Market approval by March 31, 2021 | ZTlido | Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Quarterly principal payment as a percentage of net sales | 25.00% | |||||||
Senior Notes | Scilex Pharmaceuticals, Inc | Senior Secured Notes, Due 2026 | October 1, 2022 - September 30, 2023 | ZTlido | Minimum | ||||||||
Debt Instrument [Line Items] | ||||||||
Additional principal payments, sales threshold | 60.00% | |||||||
Senior Notes | Scilex Pharmaceuticals, Inc | Senior Secured Notes, Due 2026 | February 15, 2022 | ZTlido | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal payment increase amount if cumulative net sales are not met | $ 28,000,000 | |||||||
Senior Notes | Scilex Pharmaceuticals, Inc | Senior Secured Notes, Due 2026 | February 15, 2022 | ZTlido | Minimum | ||||||||
Debt Instrument [Line Items] | ||||||||
Additional principal payments, sales threshold | 95.00% | |||||||
Senior Notes | Scilex Pharmaceuticals, Inc | Senior Secured Notes, Due 2026 | October 1, 2022 - September 30, 2023 | ZTlido | Minimum | ||||||||
Debt Instrument [Line Items] | ||||||||
Additional principal payments, sales threshold | 80.00% | |||||||
Senior Notes | Scilex Pharmaceuticals, Inc | Senior Secured Notes, Due 2026 | Prior to August 15, 2026 | ZTlido | ||||||||
Debt Instrument [Line Items] | ||||||||
Period of notice for debt redemption | 30 days | |||||||
Redemption price as a percentage of outstanding principal | 100.00% |
Debt - 2018 Purchase Agreemen_2
Debt - 2018 Purchase Agreement and Indenture for Scilex - Schedule of Long-Term Debt and Unamortized Discount Balances (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 | Sep. 07, 2018 |
Debt Instrument [Line Items] | |||
Unamortized debt discount | $ (7,000,000) | ||
Senior Secured Notes, Due 2026 | Scilex Pharmaceuticals, Inc | Senior Notes | |||
Debt Instrument [Line Items] | |||
Principal | $ 151,872,000 | 221,666,000 | $ 224,000,000 |
Unamortized debt discount | (51,022,000) | (67,839,000) | |
Unamortized debt issuance costs | (3,698,000) | (4,360,000) | |
Carrying value | 97,152,000 | 149,467,000 | |
Estimated fair value | $ 122,300,000 | $ 150,800,000 |
Debt - Future Minimum Payments
Debt - Future Minimum Payments (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Debt Instrument [Line Items] | ||
Unamortized debt discount | $ (7,000) | |
Current portion | $ (23,208) | (36,261) |
Long-term portion of Scilex Notes | 92,258 | 199,088 |
Scilex Pharmaceuticals, Inc | Senior Secured Notes, Due 2026 | Senior Notes | ||
Debt Instrument [Line Items] | ||
2021 | 4,882 | |
2022 | 5,535 | |
2023 | 7,233 | |
2024 | 8,830 | |
2025 | 10,142 | |
Thereafter | 115,250 | |
Total future minimum payments | 151,872 | |
Unamortized debt discount | (51,022) | (67,839) |
Unamortized capitalized debt issuance costs | (3,698) | |
Total Scilex Notes | 97,152 | $ 149,467 |
Current portion | (4,881) | |
Long-term portion of Scilex Notes | $ 92,271 |
Debt - 2018 Oaktree Term Loan A
Debt - 2018 Oaktree Term Loan Agreement (Details) - USD ($) | May 31, 2019 | May 03, 2019 | Nov. 30, 2019 | Nov. 30, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Nov. 07, 2018 |
Debt Instrument [Line Items] | ||||||||
Loss on debt extinguishment | $ 27,800,000 | $ 51,939,000 | $ 27,810,000 | $ 8,089,000 | ||||
2019 Warrants | ||||||||
Debt Instrument [Line Items] | ||||||||
Loss on derivative liabilities | $ 4,300,000 | |||||||
Oaktree Capital Management, L.P. | 2019 Warrants | ||||||||
Debt Instrument [Line Items] | ||||||||
Number of common stock shares called by warrants (in shares) | 1,333,304 | |||||||
Loss on derivative liabilities | $ 4,300,000 | |||||||
Oaktree Capital Management, L.P. | Oaktree Term Loan | ||||||||
Debt Instrument [Line Items] | ||||||||
Face value of loan | $ 20,000,000 | $ 100,000,000 | ||||||
Maturity Date | Nov. 7, 2023 | |||||||
Basis spread on variable rate | 7.00% | |||||||
Number of common stock shares called by warrants (in shares) | 6,288,985 | |||||||
Warrant exercise price per share (USD per share) | $ 3.28 | |||||||
Repayments of debt | 120,000,000 | |||||||
Debt prepayment costs | 9,400,000 | |||||||
Loss on debt extinguishment | 51,900,000 | |||||||
Interest expense | 3,000,000 | 10,700,000 | 1,400,000 | |||||
Amount of debt discount and debt issuance included in interest expense | $ 2,200,000 | $ 5,500,000 | $ 500,000 |
Debt - 2018 Securities Purchase
Debt - 2018 Securities Purchase Agreement for Private Placement - Additional Information (Details) - USD ($) | 1 Months Ended | 12 Months Ended | ||||
Nov. 30, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | |
Debt Instrument [Line Items] | ||||||
Loss on debt extinguishment | $ 27,800,000 | $ 51,939,000 | $ 27,810,000 | $ 8,089,000 | ||
Private Placement | March 2018 Warrant | ||||||
Debt Instrument [Line Items] | ||||||
Number of common stock shares called by warrants (in shares) | 2,698,662 | 8,591,794 | ||||
March 2018 Notes | Private Placement | Convertible Debt | ||||||
Debt Instrument [Line Items] | ||||||
Face value of loan | $ 37,848,750 | $ 120,500,000 |
Stockholders' Equity - Amended
Stockholders' Equity - Amended Sales Agreement - Additional Information (Details) - Sales Agreement | Dec. 04, 2020USD ($)BusinessDay | Apr. 27, 2020USD ($) | Dec. 31, 2020USD ($)shares |
Class of Stock [Line Items] | |||
Proceeds from issuance of common stock | $ 250,000,000 | ||
Sale of stock proceeds, net | $ 227,700,000 | ||
Sales agent commission percentage | 3.00% | ||
Number of business days advance notice | BusinessDay | 3 | ||
Common stock sold in registered direct offering | shares | 30,991,918 | ||
Maximum | |||
Class of Stock [Line Items] | |||
Proceeds from issuance of common stock | $ 450,000,000 | ||
Sale of stock proceeds, net | $ 700,000,000 |
Shareholder's Equity - Common S
Shareholder's Equity - Common Stock Purchase Agreement - Additional Information (Details) - Purchase Agreement - USD ($) | 1 Months Ended | 12 Months Ended |
Apr. 30, 2020 | Dec. 31, 2020 | |
Class of Stock [Line Items] | ||
Potential proceeds from issuance, public offering, maximum | $ 250,000,000 | |
Common stock sold in registered direct offering | 1,423,077 | |
Sale of stock proceeds, net | $ 8,000,000 |
Shareholder's Equity - Aspire T
Shareholder's Equity - Aspire Transaction - Additional Information (Details) - Aspire Purchase Agreement - USD ($) $ in Millions | Apr. 24, 2020 | Feb. 29, 2020 |
Class of Stock [Line Items] | ||
Potential proceeds from issuance, public offering, maximum | $ 75 | |
Stock issued as commitment fee | 897,308 | |
Common stock sold in registered direct offering | 33,825,010 | |
Value of shares available for issuance | $ 75 |
Stockholders' Equity - Equity D
Stockholders' Equity - Equity Distribution Agreement - Additional Information (Details) - Distribution Agreement | 1 Months Ended |
Apr. 30, 2020USD ($)shares | |
Class of Stock [Line Items] | |
Common stock sold in registered direct offering | shares | 2,120,149 |
Sale of stock proceeds, net | $ 7,400,000 |
Maximum | |
Class of Stock [Line Items] | |
Proceeds from issuance of common stock | $ 75,000,000 |
Shareholder's Equity - 2019 Pub
Shareholder's Equity - 2019 Public Offering of Common Stock and Warrants - Additional Information (Details) $ in Millions | 1 Months Ended |
Jul. 31, 2019USD ($) | |
Public Stock Offering | |
Class of Stock [Line Items] | |
Sale of stock proceeds, net | $ 23.3 |
Shareholder's Equity - 2019 Reg
Shareholder's Equity - 2019 Registered Direct Offering - Additional Information (Details) - Registered Direct Offering 2019 $ / shares in Units, $ in Millions | 1 Months Ended |
Oct. 31, 2019USD ($)$ / sharesshares | |
Subsidiary, Sale of Stock [Line Items] | |
Common stock sold in registered direct offering | shares | 10,869,566 |
Stock price (USD per share) | $ / shares | $ 2.30 |
Sale of stock proceeds, net | $ | $ 23.4 |
Stock Incentive and Employee _3
Stock Incentive and Employee Benefit Plans - 2019 Stock Incentive Plan - Additional Information (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | ||
Sep. 30, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Aggregate intrinsic value of options exercised | $ 4.1 | $ 0.5 | $ 0.1 | |
Unrestricted Stock | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Unrestricted stock granted | 37,891 | |||
2019 Stock Incentive Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Outstanding options exercisable period | 10 years | |||
Employee option grants vested | 25.00% | |||
Stock-based compensation expense | $ 15 | $ 8.3 | $ 6.2 | |
Unrecognized compensation cost related to unvested stock option grants | $ 40.1 | |||
Period for recognized compensation cost | 2 years 9 months 18 days | |||
2019 Stock Incentive Plan | Employee Stock Option | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Outstanding options vesting anniversary period | 3 years |
Stock Incentive and Employee _4
Stock Incentive and Employee Benefit Plans - Summary of Stock Option Activity (Details) $ / shares in Units, $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($)$ / sharesshares | |
Options Outstanding | |
Options Outstanding beginning balance (in shares) | shares | 14,586,661 |
Options Granted (in shares) | shares | 8,435,900 |
Options Canceled (in shares) | shares | (2,957,970) |
Options Exercised (in shares) | shares | (1,301,671) |
Options Outstanding ending balance (in shares) | shares | 18,762,920 |
Weighted-Average Exercise Price | |
Weighted Average Exercise Price, beginning balance (USD per share) | $ / shares | $ 4.36 |
Weighted Average Exercise Price, Options Granted (USD per share) | $ / shares | 5.73 |
Weighted Average Exercise Price, Options Canceled (USD per share) | $ / shares | 4.52 |
Weighted Average Exercise Price, Options Exercised (USD per share) | $ / shares | 4.25 |
Weighted Average Exercise Price, ending balance (USD per share) | $ / shares | $ 4.97 |
Aggregate Intrinsic Value | $ | $ 40,702 |
Stock Incentive and Employee _5
Stock Incentive and Employee Benefit Plans - Fair Value of Employee and Director Stock Options (Details) - Employee Stock Option - $ / shares | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted-average grant date fair value | $ 4.54 | $ 3.40 | $ 3.65 |
Dividend yield | 0.00% | 0.00% | 0.00% |
Volatility | 105.00% | 96.00% | 81.00% |
Risk-free interest rate | 0.46% | 2.02% | 2.87% |
Expected life of options (years) | 5 years 8 months 12 days | 6 years | 6 years 1 month 6 days |
Stock Incentive and Employee _6
Stock Incentive and Employee Benefit Plans - Scilex Holding Company - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Option outstanding (in shares) | 18,762,920 | 14,586,661 | |
Common stock reserved for issuance (in shares) | 82,000,000 | ||
2019 Stock Option Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Unrecognized compensation cost related to unvested stock option grants | $ 10.3 | ||
Period for recognized compensation cost | 2 years 2 months 12 days | ||
Scilex Holding Company | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation expense | $ 5.4 | $ 4.3 | $ 0.3 |
Option outstanding (in shares) | 38,234,314 | ||
Scilex Holding Company | 2019 Stock Option Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Common stock reserved for issuance (in shares) | 10,023,186 |
Stock Incentive and Employee _7
Stock Incentive and Employee Benefit Plans - Employee Stock Purchase Plan - Additional Information (Details) - USD ($) | Oct. 16, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock-based compensation | $ 31,419,000 | $ 12,648,000 | $ 6,206,000 | |
2020 Employee Stock Purchase Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Maximum percentage of their annual compensation | 15.00% | |||
Stock-based compensation | $ 25,000 | |||
Percentage of outstanding shares of common stock sold | 85.00% | |||
Stock-based compensation expense | $ 200,000 |
Stock Incentive and Employee _8
Stock Incentive and Employee Benefit Plans - CEO Performance Award - Additional Information (Details) - Chief Executive Officer - C E O Performance Award $ / shares in Units, $ in Millions | Aug. 07, 2020USD ($)Tranche$ / sharesshares | Dec. 31, 2020USD ($) |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Option to purchase common stock period | 10 years | |
Common stock sold in registered direct offering | shares | 24,935,882 | |
Percentage of outstanding shares of common stock sold | 10.00% | |
Number of tranches | Tranche | 10 | |
First market capitalization milestone amount | $ 5,000 | |
Amount of capitalization to meet next two milestones | 2,000 | |
Amount of capitalization to meet next three milestones | 3,000 | |
Amount of capitalization to meet next three milestones thereafter | 4,000 | |
Amount of capitalization to meet final milestones | 5,000 | |
Market capitalization to fully vest in award increase | $ 35,000 | |
Exercise price per share | $ / shares | $ 17.30 | |
Percentage of premium to closing sales price of common stock | 20.00% | |
Stock-based compensation expense | $ 10.8 | |
Unrecognized compensation cost related to unvested stock option grants | $ 139.5 | |
Volatility | 91.00% | |
Dividend yield | 0.00% | |
Risk-free interest rate | 0.75% | |
Expected life of options (years) | 9 years 9 months 18 days |
Stock Incentive and Employee _9
Stock Incentive and Employee Benefit Plans - Common Stock Reserved for Future Issuance - Additional Information (Details) shares in Millions | Dec. 31, 2020shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Common stock reserved for issuance (in shares) | 82 |
Warrant | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Common stock reserved for issuance (in shares) | 18.6 |
C E O Performance Award | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Common stock reserved for issuance (in shares) | 24.9 |
2020 Employee Stock Purchase Plan | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Common stock reserved for issuance (in shares) | 7.5 |
Sorrento Stock Incentive Plans | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Common stock reserved for issuance (in shares) | 30.9 |
2019 Stock Incentive Plan | Employee Stock Option | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Common stock reserved for issuance (in shares) | 12.1 |
Stock Incentive and Employee_10
Stock Incentive and Employee Benefit Plans - Employee Benefit Plan - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |||
Employer matching contributions | $ 1.4 | $ 1.3 | $ 0.9 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) $ in Thousands | Apr. 03, 2019USD ($) |
Nant Pharma | |
Other Commitments [Line Items] | |
Damages sought | $ 1,000,000 |
NANTibody | |
Other Commitments [Line Items] | |
Damages sought | 90,050 |
Damages sought to restore equity method investment | $ 40,000 |
Commitments and Contingencies_2
Commitments and Contingencies - Operating Leases - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Lessee, Lease, Description [Line Items] | |||
Operating lease expense | $ 10.1 | $ 10 | $ 6.1 |
Minimum | |||
Lessee, Lease, Description [Line Items] | |||
Operating lease remaining lease terms | 6 months | ||
Maximum | |||
Lessee, Lease, Description [Line Items] | |||
Operating lease remaining lease terms | 8 years 10 months 24 days | ||
Operating lease option to extend, period | 5 years |
Commitments and Contingencies_3
Commitments and Contingencies - Supplemental Quantitative Information Related to Leases (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Commitments And Contingencies Disclosure [Abstract] | ||
Operating cash outflows from operating leases | $ 9,880 | $ 6,935 |
ROU assets obtained in exchange for new and amended operating lease liabilities | $ 1,878 | $ 6,777 |
Weighted average remaining lease term in years | 8 years 4 months 24 days | 9 years 4 months 24 days |
Weighted average discount rate | 12.20% | 12.20% |
Commitments and Contingencies_4
Commitments and Contingencies - Schedule of Operating Lease Liability Maturities (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Commitments And Contingencies Disclosure [Abstract] | |
2021 | $ 10,010 |
2022 | 10,054 |
2023 | 10,285 |
2024 | 10,418 |
2025 | 9,757 |
Thereafter | 37,586 |
Total lease payments | 88,110 |
Less imputed interest | (34,183) |
Total lease liabilities as of December 31, 2020 | $ 53,927 |
Income Taxes - Schedule of Loss
Income Taxes - Schedule of Loss Before Income Tax By Location (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |||
United States | $ (315,516) | $ (362,776) | $ (216,098) |
Foreign | (908) | (709) | (2,702) |
Total | $ (316,424) | $ (363,485) | $ (218,800) |
Income Taxes - Schedule of Comp
Income Taxes - Schedule of Components of Provision Expense (Benefit) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Current income tax expense (benefit): | |||
Federal | $ (19) | $ (68) | $ (178) |
State | 72 | 27 | 23 |
Foreign | 58 | (37) | (44) |
Total current | 111 | (78) | (199) |
Deferred income tax expense (benefit): | |||
Federal | (55,321) | (53,080) | (31,042) |
State | (2,730) | (12,173) | (5,534) |
Foreign | (288) | (154) | (611) |
Total deferred | (58,339) | (65,407) | (37,187) |
Changes in tax rate | 507 | (94) | (453) |
Changes in valuation allowance | 55,707 | 65,106 | 31,565 |
Total income tax benefit from continuing operations | $ (2,014) | $ (473) | $ (6,274) |
Income Taxes - Summary of Compo
Income Taxes - Summary of Components of Net Deferred Tax Liabilities and Related Valuation Allowance (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred tax assets: | ||
Net operating loss carryforwards | $ 134,072 | $ 91,376 |
Deferred revenue | 25,456 | 26,064 |
Tax credit carryforwards | 22,209 | 17,575 |
Amortization of intangibles | 31,140 | 26,843 |
Operating lease liabilities | 11,726 | 12,935 |
Derivative liability | 4,150 | |
Stock based compensation | 5,359 | 3,593 |
Accrued expenses and other | 36,481 | 25,958 |
Total deferred tax assets | 266,443 | 208,494 |
Less valuation allowance | (203,512) | (148,140) |
Total deferred tax assets | 62,931 | 60,354 |
Deferred tax liabilities: | ||
Investment in common stock | (45,507) | (46,584) |
Operating lease right-of-use assets | (9,146) | (10,888) |
Other | (1,925) | (450) |
Amortization of intangibles | (13,274) | (11,475) |
Total deferred tax liabilities | (69,852) | (69,397) |
Net deferred tax liabilities | $ (6,921) | $ (9,043) |
Income Taxes - Summary of Recon
Income Taxes - Summary of Reconciliation Between Federal Income Tax and Company Provision for Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |||
Income tax benefit at federal statutory rate | $ (66,449) | $ (76,332) | $ (46,011) |
Valuation allowance | 55,707 | 65,106 | 31,565 |
State, net of federal tax benefit | (3,339) | (8,904) | (3,075) |
Debt discount and interest limitation | 896 | 7,013 | 11,357 |
Income tax credits and incentives | (3,685) | (3,018) | (3,785) |
Compensation expense | 4,446 | 764 | 1,309 |
Acquisition related charges | 583 | 18,811 | 780 |
Prior year true-up and carryback | 7,790 | (187) | (889) |
Other | 2,037 | (3,726) | 2,475 |
Total income tax benefit from continuing operations | $ (2,014) | $ (473) | $ (6,274) |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax [Line Items] | |||
Valuation allowance | $ 203,512,000 | $ 148,140,000 | |
Change in valuation allowance | 55,707,000 | 65,106,000 | $ 31,565,000 |
Total unrecognized tax benefits, if recognized, would impact effective tax rate | 5,600,000 | 4,400,000 | 3,600,000 |
Interest recognized | 0 | 0 | $ 0 |
IRS | |||
Income Tax [Line Items] | |||
Net operating loss carryforward | $ 566,800,000 | ||
Net operating loss carryforward, expiration year | 2034 | ||
IRS | Research tax credit carryforward | |||
Income Tax [Line Items] | |||
Research and development credits | $ 19,200,000 | ||
Research and development credits expiration year | 2029 | ||
Foreign | |||
Income Tax [Line Items] | |||
Net operating loss carryforward | $ 19,900,000 | ||
Net operating loss carryforward, expiration year | 2024 | ||
State | |||
Income Tax [Line Items] | |||
Net operating loss carryforward | $ 185,800,000 | ||
Net operating loss carryforward, expiration year | 2028 | ||
State | Research tax credit carryforward | |||
Income Tax [Line Items] | |||
Research and development credits | $ 10,800,000 | ||
Semnur | |||
Income Tax [Line Items] | |||
Change in valuation allowance | $ 8,100,000 |
Income Taxes - Summary of Rec_2
Income Taxes - Summary of Reconciliation of Unrecognized Tax Expense (Benefits) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Beginning balance | $ 5,336 | $ 4,352 | $ 3,883 |
Increase related to prior year tax positions | 133 | 257 | 150 |
Decrease related to prior year tax positions | 0 | (7) | (597) |
Increase related to current year tax positions | 928 | 734 | 916 |
Ending balance | $ 6,397 | $ 5,336 | $ 4,352 |
Related Party Agreements and _2
Related Party Agreements and Other - Additional Information (Details) - USD ($) | Jul. 15, 2020 | May 15, 2020 | May 13, 2020 | Dec. 31, 2020 |
Related Party Transaction [Line Items] | ||||
Options Granted (in shares) | 8,435,900 | |||
Cytimm | ||||
Related Party Transaction [Line Items] | ||||
Business acquisition, percentage of voting interests acquired | 50.00% | |||
Cash consideration to equity holders | $ 2,500,000 | |||
Consulting agreement with Kim Janda | ||||
Related Party Transaction [Line Items] | ||||
Advisory services one-time fee payable per annum | $ 250,000 | |||
Advisory services one-time fee payable period | 12 months | |||
Options Granted (in shares) | 150,000 | |||
Related party, option to purchase vesting rate description | vests at a rate of 1/48th per month commencing on July 15, 2020 | |||
Pulsar | ||||
Related Party Transaction [Line Items] | ||||
Shares transferred for exchange of equity interest | 1,000,000 | |||
Equity interest | 5.00% | |||
Percentage of shares owned by the director and chairperson | 45.00% | |||
Percentage of shares owned by board member | 5.00% | |||
Itochu | Affiliated Entity | ||||
Related Party Transaction [Line Items] | ||||
Purchases from related party | $ 1,000,000 | |||
Effective date | Oct. 2, 2028 | |||
First commercial sale period | 10 years | |||
Successive renewal periods | 1 year | |||
Termination written notice | 6 months | |||
Itochu | Affiliated Entity | Minimum | ||||
Related Party Transaction [Line Items] | ||||
Royalty payments percent | 25.00% | |||
Itochu | Affiliated Entity | Maximum | ||||
Related Party Transaction [Line Items] | ||||
Royalty payments percent | 35.00% | |||
Itochu | Scilex Pharmaceuticals, Inc | ||||
Related Party Transaction [Line Items] | ||||
Noncontrolling interest ownership percentage | 14.70% |
Segment Information - Additiona
Segment Information - Additional Information (Details) - segment | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Segment Reporting [Abstract] | ||
Number of operating segments | 2 | 2 |
Number of reportable segments | 2 |
Segment Information - Summary o
Segment Information - Summary of Information by Reportable Segments (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Segment Reporting Information [Line Items] | |||||||||||
External revenues | $ 11,505 | $ 11,753 | $ 9,007 | $ 7,721 | $ 13,034 | $ 5,778 | $ 6,477 | $ 6,143 | $ 39,986 | $ 31,432 | $ 21,193 |
Operating expenses | 82,028 | $ 94,857 | $ 56,735 | $ 50,884 | 45,613 | $ 59,061 | $ 56,838 | $ 129,313 | 284,504 | 290,825 | 171,618 |
Operating (loss) income | (244,518) | (259,393) | (150,425) | ||||||||
Unrestricted cash | 56,464 | 22,521 | 56,464 | 22,521 | 158,738 | ||||||
Sorrento Therapeutics | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
External revenues | 13,655 | 10,399 | 18,587 | ||||||||
Operating expenses | 225,687 | 130,529 | 137,166 | ||||||||
Operating (loss) income | (212,032) | (120,130) | (118,579) | ||||||||
Unrestricted cash | 51,475 | 12,176 | 51,475 | 12,176 | 86,024 | ||||||
Scilex | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
External revenues | 26,331 | 21,033 | 2,606 | ||||||||
Operating expenses | 58,817 | 160,296 | 34,452 | ||||||||
Operating (loss) income | (32,486) | (139,263) | (31,846) | ||||||||
Unrestricted cash | $ 4,989 | $ 10,345 | $ 4,989 | $ 10,345 | $ 72,714 |
Quarterly Financial Data (Una_3
Quarterly Financial Data (Unaudited) - Schedule of Quarterly Financial Data (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Revenues | $ 11,505 | $ 11,753 | $ 9,007 | $ 7,721 | $ 13,034 | $ 5,778 | $ 6,477 | $ 6,143 | $ 39,986 | $ 31,432 | $ 21,193 |
Operating costs and expenses | 82,028 | 94,857 | 56,735 | 50,884 | 45,613 | 59,061 | 56,838 | 129,313 | 284,504 | 290,825 | 171,618 |
Net income (loss) attributable to Sorrento | $ (71,503) | $ (84,023) | $ (77,740) | $ (65,195) | $ (62,820) | $ (64,415) | $ (56,762) | $ (108,071) | $ (298,461) | $ (292,068) | $ (203,540) |
Net income (loss) per share - basic (USD per share) | $ (0.27) | $ (0.33) | $ (0.36) | $ (0.36) | $ (0.41) | $ (0.49) | $ (0.46) | $ (0.88) | $ (1.30) | $ (2.20) | $ (1.92) |
Net income (loss) per share - diluted (USD per share) | $ (0.27) | $ (0.33) | $ (0.36) | $ (0.36) | $ (0.41) | $ (0.50) | $ (0.47) | $ (0.88) | $ (1.30) | $ (2.35) | $ (1.92) |
Weighted-average shares - basic (in shares) | 267,863 | 251,211 | 216,956 | 182,609 | 154,964 | 130,800 | 122,549 | 122,281 | 229,823 | 132,732 | 106,150 |
Weighted-average shares - diluted (shares) | 267,863 | 257,670 | 216,956 | 182,609 | 154,964 | 140,445 | 132,459 | 122,281 | 229,823 | 140,514 | 106,150 |
Loss Per Share - Reconciliation
Loss Per Share - Reconciliation of Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Numerator | |||||||||||
Net income (loss) attributable to Sorrento | $ (71,503) | $ (84,023) | $ (77,740) | $ (65,195) | $ (62,820) | $ (64,415) | $ (56,762) | $ (108,071) | $ (298,461) | $ (292,068) | $ (203,540) |
Net loss attributable to Semnur holders of Scilex Holding | (38,669) | ||||||||||
Net loss used for diluted earnings per share | $ (298,461) | $ (330,737) | $ (203,540) | ||||||||
Weighted-average shares outstanding during period - basic per share attributable to Sorrento (in shares) | 267,863 | 251,211 | 216,956 | 182,609 | 154,964 | 130,800 | 122,549 | 122,281 | 229,823 | 132,732 | 106,150 |
Potentially dilutive shares of Sorrento common stock issuable upon Semnur Share Exchange | 7,782 | ||||||||||
Denominator for loss earnings per share | 267,863 | 257,670 | 216,956 | 182,609 | 154,964 | 140,445 | 132,459 | 122,281 | 229,823 | 140,514 | 106,150 |
Net loss per share - basic per share attributable to Sorrento | $ (0.27) | $ (0.33) | $ (0.36) | $ (0.36) | $ (0.41) | $ (0.49) | $ (0.46) | $ (0.88) | $ (1.30) | $ (2.20) | $ (1.92) |
Net loss per share - diluted per share attributable to Sorrento | $ (0.27) | $ (0.33) | $ (0.36) | $ (0.36) | $ (0.41) | $ (0.50) | $ (0.47) | $ (0.88) | $ (1.30) | $ (2.35) | $ (1.92) |
Loss Per Share - Outstanding Se
Loss Per Share - Outstanding Securities (Details) - shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Employee Stock Option | |||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of Earnings Per Share (in shares) | 18,763 | 14,587 | 10,523 |
Warrant | |||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of Earnings Per Share (in shares) | 18,605 | 57,556 | 25,635 |