Cover
Cover - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Feb. 21, 2023 | Jun. 30, 2022 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2022 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 0-24006 | ||
Entity Registrant Name | NEKTAR THERAPEUTICS | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 94-3134940 | ||
Entity Address, Address Line One | 455 Mission Bay Boulevard South | ||
Entity Address, City or Town | San Francisco | ||
Entity Address, State or Province | CA | ||
Entity Address, Postal Zip Code | 94158 | ||
City Area Code | 415 | ||
Local Phone Number | 482-5300 | ||
Title of 12(b) Security | Common Stock, $0.0001 par value | ||
Trading Symbol | NKTR | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 704 | ||
Entity Common Stock, Shares Outstanding (in shares) | 189,235,139 | ||
Documents Incorporated by Reference | Portions of registrant’s definitive Proxy Statement to be filed for its 2023 Annual Meeting of Stockholders are incorporated by reference into Part III hereof. Such Proxy Statement will be filed with the Securities and Exchange Commission within 120 days of the end of the fiscal year covered by this Annual Report on Form 10-K. | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY | ||
Entity Central Index Key | 0000906709 |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2022 | |
Auditor Information [Abstract] | |
Auditor Name | Ernst & Young LLP |
Auditor Location | San Mateo, California |
Auditor Firm ID | 42 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 88,227 | $ 25,218 |
Short-term investments | 416,750 | 708,737 |
Accounts receivable | 5,981 | 22,492 |
Inventory | 19,202 | 15,801 |
Other current assets | 15,808 | 23,333 |
Total current assets | 545,968 | 795,581 |
Long-term investments | 0 | 64,828 |
Property, plant and equipment, net | 32,451 | 60,510 |
Operating lease right-of-use assets | 53,435 | 117,025 |
Goodwill | 76,501 | 76,501 |
Other assets | 2,245 | 2,744 |
Total assets | 710,600 | 1,117,189 |
Current liabilities: | ||
Accounts payable | 12,980 | 9,747 |
Accrued compensation | 9,582 | 15,735 |
Accrued clinical trial expenses | 12,262 | 26,809 |
Other accrued expenses | 14,713 | 15,468 |
Operating lease liabilities, current portion | 18,667 | 17,441 |
Total current liabilities | 68,204 | 85,200 |
Operating lease liabilities, less current portion | 112,829 | 125,736 |
Development derivative liability | 0 | 27,726 |
Liabilities related to the sales of future royalties, net | 155,378 | 195,427 |
Other long-term liabilities | 7,551 | 3,592 |
Total liabilities | 343,962 | 437,681 |
Commitments and contingencies | ||
Stockholders’ equity: | ||
Preferred stock, $0.0001 par value; 10,000 shares authorized; no shares designated, issued or outstanding at December 31, 2022 or 2021 | 0 | 0 |
Common stock, $0.0001 par value; 300,000 shares authorized; 188,560 shares and 185,468 shares issued and outstanding at December 31, 2022 and 2021, respectively | 19 | 19 |
Capital in excess of par value | 3,574,719 | 3,516,641 |
Accumulated other comprehensive loss | (6,907) | (4,157) |
Accumulated deficit | (3,201,193) | (2,832,995) |
Total stockholders’ equity | 366,638 | 679,508 |
Total liabilities and stockholders’ equity | $ 710,600 | $ 1,117,189 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in usd per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, shares designated (in shares) | 0 | 0 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in usd per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 300,000,000 | 300,000,000 |
Common stock, shares issued (in shares) | 188,560,000 | 185,468,000 |
Common stock, shares outstanding (in shares) | 188,560,000 | 185,468,000 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Revenue: | |||
Total revenue | $ 92,055 | $ 101,907 | $ 152,915 |
Operating costs and expenses: | |||
Cost of goods sold | 21,635 | 24,897 | 19,477 |
Research and development | 218,323 | 400,269 | 408,678 |
General and administrative | 92,333 | 122,844 | 104,682 |
Restructuring, impairment and other costs of terminated program | 135,930 | 0 | 45,189 |
Total operating costs and expenses | 468,221 | 548,010 | 578,026 |
Loss from operations | (376,166) | (446,103) | (425,111) |
Non-operating income (expense): | |||
Change in fair value of development derivative liability | 33,427 | (8,023) | 0 |
Non-cash interest expense on liabilities related to the sales of future royalties | (28,911) | (47,313) | (30,267) |
Loss on revaluation of liability related to the sale of future royalties | 0 | (24,410) | 0 |
Interest income and other income (expense), net | 6,667 | 2,569 | 18,282 |
Interest expense | 0 | 0 | (6,851) |
Total non-operating income (expense), net | 11,183 | (77,177) | (18,836) |
Loss before provision for income taxes | (364,983) | (523,280) | (443,947) |
Provision for income taxes | 3,215 | 557 | 493 |
Net loss | $ (368,198) | $ (523,837) | $ (444,440) |
Basic net loss per share (in dollars per share) | $ (1.97) | $ (2.86) | $ (2.49) |
Diluted net loss per share (in dollars per share) | $ (1.97) | $ (2.86) | $ (2.49) |
Weighted average shares outstanding used in computing basic net loss per share (in shares) | 187,138 | 183,298 | 178,581 |
Weighted average shares outstanding used in computing diluted net loss per share (in shares) | 187,138 | 183,298 | 178,581 |
Product sales | |||
Revenue: | |||
Total revenue | $ 20,348 | $ 23,725 | $ 17,504 |
Royalty revenue | |||
Revenue: | |||
Total revenue | 0 | 0 | 30,999 |
Non-cash royalty revenue related to the sales of future royalties | |||
Revenue: | |||
Total revenue | 69,794 | 77,746 | 48,563 |
License, collaboration and other revenue | |||
Revenue: | |||
Total revenue | $ 1,913 | $ 436 | $ 55,849 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Statement of Comprehensive Income [Abstract] | |||
Net loss | $ (368,198) | $ (523,837) | $ (444,440) |
Other comprehensive income (loss): | |||
Net unrealized gain (loss) on available-for-sale investments | (1,114) | (1,568) | (927) |
Net foreign currency translation gain (loss) | (1,636) | (294) | (363) |
Other comprehensive income (loss) | (2,750) | (1,862) | (1,290) |
Comprehensive loss | $ (370,948) | $ (525,699) | $ (445,730) |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Capital in Excess of Par Value | Accumulated Other Comprehensive Loss | Accumulated Deficit |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Common stock, shares outstanding (in shares) | 176,505 | ||||
Beginning balance (in shares) at Dec. 31, 2019 | 176,505 | ||||
Beginning balance at Dec. 31, 2019 | $ 1,405,391 | $ 17 | $ 3,271,097 | $ (1,005) | $ (1,864,718) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Shares issued under equity compensation plans (in shares) | 3,586 | ||||
Shares issued under equity compensation plans | 23,373 | $ 1 | 23,372 | ||
Stock-based compensation | 94,261 | 94,261 | |||
Comprehensive loss | (445,730) | (1,290) | (444,440) | ||
Ending balance (in shares) at Dec. 31, 2020 | 180,091 | ||||
Ending balance at Dec. 31, 2020 | 1,077,295 | $ 18 | 3,388,730 | (2,295) | (2,309,158) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Common stock, shares outstanding (in shares) | 180,091 | ||||
Shares issued under equity compensation plans (in shares) | 5,377 | ||||
Shares issued under equity compensation plans | 33,238 | $ 1 | 33,237 | ||
Stock-based compensation | 94,674 | 94,674 | |||
Comprehensive loss | $ (525,699) | (1,862) | (523,837) | ||
Ending balance (in shares) at Dec. 31, 2021 | 185,468 | 185,468 | |||
Ending balance at Dec. 31, 2021 | $ 679,508 | $ 19 | 3,516,641 | (4,157) | (2,832,995) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Common stock, shares outstanding (in shares) | 185,468 | 185,468 | |||
Shares issued under equity compensation plans (in shares) | 3,092 | ||||
Shares issued under equity compensation plans | $ 758 | $ 0 | 758 | ||
Stock-based compensation | 57,320 | 57,320 | |||
Comprehensive loss | $ (370,948) | (2,750) | (368,198) | ||
Ending balance (in shares) at Dec. 31, 2022 | 188,560 | 188,560 | |||
Ending balance at Dec. 31, 2022 | $ 366,638 | $ 19 | $ 3,574,719 | $ (6,907) | $ (3,201,193) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Common stock, shares outstanding (in shares) | 188,560 | 188,560 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | 130 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2022 | |
Cash flows from operating activities: | ||||
Net loss | $ (368,198) | $ (523,837) | $ (444,440) | |
Adjustments to reconcile net loss to net cash used in operating activities: | ||||
Non-cash royalty revenue related to the sales of future royalties | (69,794) | (77,746) | (48,563) | $ (403,245) |
Non-cash interest expense on liabilities related to sales of future royalties | 28,911 | 47,313 | 30,267 | 273,184 |
Loss on revaluation of liability related to the sale of future royalties | 0 | 24,410 | 0 | |
Change in fair value of development derivative liability | (33,427) | 8,023 | 0 | |
Non-cash research and development expense | 4,951 | 16,703 | 0 | |
Stock-based compensation | 57,320 | 94,674 | 94,261 | |
Depreciation and amortization | 13,030 | 14,146 | 14,182 | |
Deferred income tax expense | 2,708 | (102) | (36) | |
Impairment of right-of-use assets and property, plant and equipment | 65,761 | 0 | 0 | |
(Gain) loss on sale or disposal of property, plant and equipment, net | (3,326) | 0 | 0 | |
Impairment of advance payments to contract manufacturers and equipment for terminated program | 0 | 0 | 20,351 | |
Amortization of premiums (discounts), net and other non-cash transactions | (2,435) | 6,730 | 3,943 | |
Changes in operating assets and liabilities: | ||||
Accounts receivable | 16,511 | 12,397 | 1,913 | |
Inventory | (3,401) | (509) | (2,627) | |
Operating leases, net | (2,680) | 2,340 | 2,743 | |
Other assets | 6,906 | (2,586) | 4,512 | |
Accounts payable | 3,103 | (11,690) | 2,382 | |
Accrued compensation | (6,153) | 1,203 | 4,697 | |
Other accrued expenses | (12,734) | (23,524) | 8,644 | |
Deferred revenue | (1,060) | (605) | (5,516) | |
Net cash used in operating activities | (304,007) | (412,660) | (313,287) | |
Cash flows from investing activities: | ||||
Purchases of investments | (467,914) | (960,689) | (987,533) | |
Maturities of investments | 826,229 | 1,166,951 | 1,449,304 | |
Sales of investments | 0 | 11,504 | 41,700 | |
Purchases of property, plant and equipment | (5,676) | (14,989) | (7,258) | |
Sales of property, plant and equipment | 13,196 | 0 | 0 | |
Net cash provided by investing activities | 365,835 | 202,777 | 496,213 | |
Cash flows from financing activities: | ||||
Proceeds from sale of future royalties, net of $3.8 million of transaction costs | 0 | 0 | 146,250 | |
Repayment of senior notes | 0 | 0 | (250,000) | |
Cash receipts from development derivative liability | 750 | 3,000 | 0 | |
Proceeds from shares issued under equity compensation plans | 758 | 33,238 | 23,396 | |
Net cash provided by (used in) financing activities | 1,508 | 36,238 | (80,354) | |
Effect of foreign exchange rates on cash and cash equivalents | (327) | (92) | 20 | |
Net increase (decrease) in cash and cash equivalents | 63,009 | (173,737) | 102,592 | |
Cash and cash equivalents at beginning of year | 25,218 | 198,955 | 96,363 | |
Cash and cash equivalents at end of year | 88,227 | 25,218 | 198,955 | $ 88,227 |
Supplemental disclosure of cash flow information: | ||||
Cash paid for interest | 0 | 0 | 9,742 | |
Cash paid for income taxes | 272 | 325 | 539 | |
Operating lease right-of-use assets recognized in exchange for lease liabilities | 0 | 1,057 | 2,133 | |
Accounts receivable recognized in exchange for long-term liabilities | $ 0 | $ 0 | $ 4,000 |
CONSOLIDATED STATEMENTS OF CA_2
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) $ in Millions | 12 Months Ended |
Dec. 31, 2020 USD ($) | |
Statement of Cash Flows [Abstract] | |
Sale of future royalties transaction costs | $ 3.8 |
Organization and Summary of Sig
Organization and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Summary of Significant Accounting Policies | Organization and Summary of Significant Accounting Policies Organization We are a research-based biopharmaceutical company headquartered in San Francisco, California and incorporated in Delaware. We are developing a pipeline of drug candidates that utilize our advanced polymer conjugate technology platforms, which are designed to enable the development of new molecular entities that target known mechanisms of action. Our research and development pipeline of new investigational drugs includes innovative medicines in the field of immunotherapy. Our research and development activities have required significant ongoing investment to date and are expected to continue to require significant investment. As a result, we expect to continue to incur substantial losses and negative cash flows from operations in the future. We have financed our operations primarily through cash generated from licensing, collaboration and manufacturing agreements and financing transactions. At December 31, 2022, we had approximately $505.0 million in cash and investments in marketable securities. Results of Bempegaldesleukin Program and the 2022 Restructuring Plan In March and April 2022, we announced the unsuccessful results from our clinical trials studying bempegaldesleukin in combination with Opdivo ® under our Strategic Collaboration Agreement with Bristol-Myers Squibb Company (BMS). Based on these results, we decided to discontinue all of our ongoing clinical trials of bempegaldesleukin in combination with checkpoint inhibitors and tyrosine kinase inhibitors. In April 2022, we also announced new strategic reorganization and cost restructuring plans (together, the 2022 Restructuring Plan) for the Company’s future: • On March 14, 2022, BMS and we announced that the registrational trial for bempegaldesleukin in combination with Opdivo ® in metastatic melanoma did not meet its primary endpoints and that BMS and we decided to discontinue the registrational trials in metastatic melanoma and adjuvant melanoma. See Note 10 for additional information on our BMS Collaboration Agreement. • On April 14, 2022, we announced that each of our registrational trials for bempegaldesleukin in combination with Opdivo ® in renal cell carcinoma and in cisplatin-ineligible, locally advanced or metastatic urothelial cancer did not meet their respective primary endpoints. Due to these results, BMS and we decided to discontinue these studies and all other ongoing studies for bempegaldesleukin in combination with Opdivo ® . • On April 14, 2022, we announced that, in consultation with SFJ Pharmaceuticals and based upon a recommendation from an independent Data Monitoring Committee, we decided to discontinue our Phase 2/3 study in bempegaldesleukin in combination with Keytruda ® in patients with metastatic or unresectable recurrent squamous cell cancer of the head and neck under our Co-Development Agreement with SFJ Pharmaceuticals. See Note 6 for additional information regarding our Co-Development Agreement with SFJ Pharmaceuticals. • We also announced on April 14, 2022, the discontinuation of our Phase 1/2 PROPEL study of bempegaldesleukin in combination with Keytruda ® in locally advanced or metastatic solid tumors, including non-small cell lung cancer. With these announcements on April 14, 2022, subject to activities required for an orderly wind down of the studies, there will be no ongoing clinical development activities of bempegaldesleukin. • On April 25, 2022, we announced our 2022 Restructuring Plan, which was reviewed and approved by our Board of Directors on April 14, 2022. Pursuant to the 2022 Restructuring Plan, on April 26, 2022, our duly authorized officers implemented certain strategic, operational and organizational steps, including the prioritization of key Phase 2 development programs to advance our early stage research pipeline. In addition, we announced our plan to reduce our workforce by approximately 70% and to close our research facility in India. We have incurred significant costs resulting from these decisions and plans. See Note 11 for additional information on the effect of the 2022 Restructuring Plan on our Consolidated Financial Statements. Basis of Presentation, Principles of Consolidation and Use of Estimates Our Consolidated Financial Statements include the financial position, results of operations and cash flows of our wholly-owned subsidiaries. We have eliminated all intercompany accounts and transactions in consolidation. Our Consolidated Financial Statements are denominated in U.S. dollars. Accordingly, changes in exchange rates between the applicable foreign currency and the U.S. dollar will affect the translation of each foreign subsidiary’s financial results into U.S. dollars for purposes of reporting our consolidated financial results. We include translation gains and losses in accumulated other comprehensive loss in the stockholders’ equity section of our Consolidated Balance Sheets. To date, such cumulative currency translation adjustments have not been significant to our consolidated financial position. Our comprehensive loss consists of our net loss plus our foreign currency translation gains and losses and unrealized holding gains and losses on available-for-sale securities. There were no significant reclassifications out of accumulated other comprehensive loss to the statements of operations during the years ended December 31, 2022, 2021 and 2020. The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Accounting estimates and assumptions are inherently uncertain. Actual results could differ materially from those estimates and assumptions. Our estimates include those related to the selling prices of performance obligations and amounts of variable consideration in collaboration agreements, royalty revenue, and other assumptions required for revenue recognition as described further below; the net realizable value of inventory; the fair value and impairment of investments, goodwill and long-lived assets; contingencies, accrued clinical trial, contract manufacturing and other expenses; income taxes; non-cash royalty revenue and non-cash interest expense from our liabilities related to our sales of future royalties; assumptions used in the valuation of our development derivative liability as further described in Note 6; our assumptions used in stock-based compensation; and ongoing litigation, among other estimates. We base our estimates on historical experience and on other assumptions that management believes are reasonable under the circumstances. These estimates form the basis for making judgments about the carrying values of assets and liabilities when these values are not readily apparent from other sources. As appropriate, we assess estimates each period, update them to reflect current information, and will generally reflect any changes in estimates in the period first identified. Fair Value of Financial Instruments The recorded amounts of certain financial instruments, including cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate their fair values due to their relatively short maturities. We record available-for-sale investments and cash equivalents at their estimated fair values, which are based on market prices from a variety of industry standard data providers and generally represent quoted prices for similar assets in active markets or have been derived from observable market data. As further described in Note 11, we estimated the fair value of our lease assets for recognizing impairment charges based on management’s estimates of several unobservable inputs, including estimated time to enter a sublease, sublease rental rates and free rent periods. As further described in Note 6, we recorded the development derivative liability at its estimated fair value based on management’s estimates of several unobservable inputs, including the probabilities of success of clinical trials and various other inputs. The fair value of our financial assets and liabilities are determined in accordance with the fair value hierarchy established in ASC 820-10, Fair Value Measurements and Disclosures (ASC 820). ASC 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The fair value hierarchy of ASC Topic 820 requires an entity to maximize the use of observable inputs when measuring fair value and classifies those inputs into three levels: Level 1 — Quoted prices in active markets for identical assets or liabilities. Level 2 — Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices for identical or similar assets or liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. For the years ended December 31, 2022 and 2021, there were no transfers between Level 1 and Level 2 of the fair value hierarchy. Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Cash, Cash Equivalents, and Investments in Marketable Securities We consider all investments in marketable securities with an original maturity of three months or less when purchased to be cash equivalents. We classify investments in securities with remaining maturities of less than one year, or where our intent is to use the investments to fund current operations or to make them available for current operations, as short-term investments. We classify investments in securities with remaining maturities of over one year as long-term investments. Our cash and investments are held or issued by financial institutions that management believes are of high credit quality. However, they are exposed to credit risk in the event of default by the third parties that hold or issue such assets. Our investment policy limits investments to fixed income securities denominated and payable in U.S. dollars such as corporate bonds, corporate commercial paper, U.S. government obligations, and money market funds and places restrictions on maturities and concentrations by type and issuer. For our available-for-sale securities, we have significant concentrations of issuers in the banking and financial services industry. While our investment policy requires that we only invest in highly-rated securities and limit our exposure to any single issuer, a variety of factors may materially affect the financial condition of issuers. Additionally, pursuant to our investment policy, we may sell securities before maturity if the issuer’s credit rating has been downgraded below our minimum credit rating requirements, which may result in a loss on the sale. Accordingly, if factors result in downgrades below our minimum credit rating requirements and if we decide to sell these securities, we may experience losses on such sales. Investments are designated as available-for-sale and are carried at fair value with unrealized gains and losses reported in stockholders’ equity as accumulated other comprehensive income (loss). We review our portfolio of available-for-sale debt securities, using both quantitative and qualitative factors, to determine if declines in fair value below amortized cost have resulted from a credit-related loss or other factors. If the decline in fair value is due to credit-related factors, we recognize a loss in our Consolidated Statement of Operations, whereas if the decline in fair value is not due to credit-related factors, we recognize the loss in other comprehensive income (loss). We include coupon interest on securities classified as available-for-sale, as well as amortization of premiums and accretion of discounts to maturity, in interest income. The cost of securities sold is based on the specific identification method. Accounts Receivable and Significant Customer Concentrations Our customers are primarily pharmaceutical and biotechnology companies that are primarily located in the U.S. and Europe and with whom we have multi-year arrangements. Our accounts receivable balance contains billed and unbilled trade receivables from product sales, milestones (to the extent that they have been achieved and are due from the counterparty), other contingent payments, as well as reimbursable costs from collaborative research and development agreements. Our accounts receivable included $4.2 million and $21.4 million for unbilled net expense reimbursements from our collaboration partner Bristol-Myers Squibb Company (BMS) as of December 31, 2022 and December 31, 2021, respectively. The remaining accounts receivable related primarily to product sales. We perform a regular review of our partners’ credit risk and payment histories when circumstances warrant, including payments made subsequent to year-end. When appropriate, we provide for an allowance for doubtful accounts by reserving for specifically identified doubtful accounts, although historically we have not experienced credit losses from our accounts receivable. Inventory and Significant Supplier Concentrations We generally manufacture inventory upon receipt of firm purchase orders from our collaboration partners, and we may manufacture certain intermediate work-in-process materials and purchase raw materials based on purchase forecasts from our collaboration partners. Inventory includes direct materials, direct labor, and manufacturing overhead, and we determine cost on a first-in, first-out basis for raw materials and on a specific identification basis for work-in-process and finished goods. We value inventory at the lower of cost or net realizable value, and we write down defective or excess inventory to net realizable value based on historical experience or projected usage. We expense inventory related to our research and development activities when we purchase or manufacture it. We are dependent on our suppliers and contract manufacturers to provide raw materials and drugs of appropriate quality and reliability and to meet applicable contract and regulatory requirements. In certain cases, we rely on single sources of supply of one or more critical materials. Consequently, in the event that supplies are delayed or interrupted for any reason, our ability to develop and produce our drug candidates, our ability to supply comparator drugs for our clinical trials, or our ability to meet our supply obligations could be significantly impaired, which could have a material adverse effect on our business, financial condition and results of operations. Restructuring We recognize restructuring charges related to reorganization plans that have been committed to by management when liabilities have been incurred. In connection with these activities, we record restructuring charges at fair value for: • contractual employee termination benefits provided that the obligations result from services already rendered based on vested rights to such benefits when the payment of benefits becomes probable and the amount can be reasonably estimated; • one-time employee termination benefits on the communication date from management to the employees provided that management has committed to a plan of termination, the plan identifies the employees and their expected termination dates, the details of termination benefits are complete, and it is unlikely that changes to the plan will be made or the plan will be withdrawn; • contract termination costs when we cancel the contract in accordance with its terms; and • costs to be incurred over the remaining contract term without economic benefit to us at the cease-use date. For one-time employee terminations benefits, we recognize the liability in full on the communication date when future services are not required or amortize the liability ratably over the service period, if required. The fair value of termination benefits reflects our estimates of expected utilization of certain Company-funded post-employment benefits. See Note 11 for additional information on the severance expense that we recognized for employees terminated in connection with our 2022 Restructuring Plan. Long-Lived Assets We report property, plant and equipment at cost, net of accumulated depreciation. We capitalize major improvements and expense maintenance and repairs as incurred. We generally recognize depreciation on a straight-line basis. We depreciate manufacturing, laboratory and other equipment over their estimated useful lives of generally three Goodwill represents the excess of the price paid for another entity over the fair value of the assets acquired and liabilities assumed in a business combination. We are organized in one reporting unit and evaluate the goodwill for the Company as a whole. Goodwill has an indefinite useful life and is not amortized, but instead tested for impairment at least annually in the fourth quarter of each year using an October 1 measurement date. We assess the impairment of long-lived assets whenever events or changes in business circumstances indicate that the carrying amounts of the assets may not be fully recoverable. In the case of property, plant and equipment and right-of-use assets for our leases, we determine whether there has been an impairment by comparing the carrying value of the asset to the anticipated undiscounted net cash flows associated with the asset. If such cash flows are less than the carrying value, we write down the asset to its fair value, which may be measured as anticipated discounted net cash flows associated with the asset. In the case of goodwill impairment, we compare the carrying value of the reporting unit to its fair value, which we generally measure using market capitalization for our single reporting unit. If an impairment exists, we write down goodwill such that the carrying value of the reporting unit equals its fair value. See Note 11 for additional information on the long-lived asset impairment expense that we recognized in connection with our 2022 Restructuring Plan. Leases We determine if an arrangement contains a lease at the inception of the arrangement. Right-of-use assets represent our right to use an underlying asset for the lease term, and lease liabilities represent our obligation to make lease payments arising from the lease. We recognize operating lease right-of-use assets and liabilities at the lease commencement date based on the present value of lease payments over the expected lease term. In determining the present value of lease payments, we use our incremental borrowing rate based on the information available at the lease commencement date. We have elected the practical expedient to account for the lease and non-lease components, such as common area maintenance charges, as a single lease component for our facilities leases, and elected the short-term lease recognition exemption for our short-term leases, under which we do not recognize lease liabilities and right-of-use assets for leases with an original term of twelve months or less. Our expected lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise any such options. We recognize lease expense for our operating leases on a straight-line basis over the expected lease term. We have elected to recognize lease incentives, such as tenant improvement allowances, at the lease commencement date as a reduction of the right-of-use asset and lease liability until paid to us by the lessor to the extent that the lease provides a specified fixed or maximum level of reimbursement and we are reasonably certain to incur reimbursable costs at least equaling such amounts. Please see Note 5 for additional information regarding our leases. Collaborative Arrangements We enter into collaboration arrangements with pharmaceutical and biotechnology collaboration partners, under which we may grant licenses to our collaboration partners to further develop and commercialize one of our drug candidates, either alone or in combination with the collaboration partners’ compounds, or grant licenses to partners to use our technology to research and develop their own drug candidates. We may also perform research, development, manufacturing and supply activities under our collaboration agreements. Consideration under these contracts may include an upfront payment, development and regulatory milestones and other contingent payments, expense reimbursements, royalties based on net sales of approved drugs, and commercial sales milestone payments. Additionally, these contracts may provide options for the customer to purchase our proprietary PEGylation materials, drug candidates or additional contract research and development services under separate contracts. When we enter into collaboration agreements, we assess whether the arrangements fall within the scope of ASC 808, Collaborative Arrangements (ASC 808) based on whether the arrangements involve joint operating activities and whether both parties have active participation in the arrangement and are exposed to significant risks and rewards of the arrangement. To the extent that the arrangement falls within the scope of ASC 808, we assess whether the payments between us and our collaboration partner fall within the scope of other accounting literature. If we conclude that payments from the collaboration partner to us represent consideration from a customer, such as license fees and contract research and development activities, we account for those payments within the scope of ASC 606, Revenue from Contracts with Customers (ASC 606). However, if we conclude that our collaboration partner is not a customer for certain activities and associated payments, such as for certain collaborative research, development, manufacturing and commercial activities, we present such payments as a reduction of research and development expense or general and administrative expense, based on where we present the underlying expense. Revenue Recognition For elements of those arrangements that we determine should be accounted for under ASC 606, we assess which activities in our collaboration agreements are performance obligations that should be accounted for separately and determine the transaction price of the arrangement, which includes the assessment of the probability of achievement of future milestones and other potential consideration. For arrangements that include multiple performance obligations, such as granting a license or performing contract research and development activities or participation on joint steering or other committees, we allocate upfront and milestone payments under a relative standalone selling price method. Accordingly, we develop assumptions that require judgment to determine the standalone selling price for each performance obligation identified in the contract. These key assumptions may include revenue forecasts, clinical development timelines and costs, discount rates and probabilities of clinical and regulatory success. Product sales Product sales are primarily derived from manufacturing and supply agreements with our customers. We have assessed our current manufacturing and supply arrangements and have generally determined that they provide the customer an option to purchase our proprietary PEGylation materials. Accordingly, we treat each purchase order as a discrete exercise of the customer’s option (i.e. a separate contract) rather than as a component of the overall arrangement. The pricing for the manufacturing and supply is generally at a fixed price and may be subject to annual producer price index (PPI) adjustments. We invoice and recognize product sales when title and risk of loss pass to the customer, which generally occurs upon shipment. Customer payments are generally due 30 days from receipt of an invoice. We test our products for adherence to technical specifications before shipment; accordingly, we have not experienced any significant returns from our customers. We recognize costs related to shipping and handling of product to customers in cost of goods sold. Royalty revenue, including Non-cash royalty revenue Generally, for our collaboration arrangements that include sales-based royalties, we have granted our collaboration partner a license to our intellectual property. Pursuant to these arrangements, our collaboration partners are typically obligated to pay a royalty that is based on the net sales of their approved drugs that are sold in the countries where we have intellectual property rights covering their drugs. We have sold our rights to receive sales-based royalties for CIMZIA ® , MIRCERA ® , MOVANTIK ® , ADYNOVATE ® and REBINYN ® as further described in Note 7. For collaboration arrangements that include sales-based royalties, we have concluded that the license is the predominant item to which the royalties relate, which include commercial milestone payments based on the level of sales. Accordingly, we recognize royalty revenue when the underlying sales occur based on our best estimates of sales of the drugs. Our aggregate royalty and non-cash royalty revenue of $69.8 million, $77.7 million and $79.6 million for the years ended December 31, 2022, 2021 and 2020, respectively, represents revenue for granting licenses for which we had satisfied in prior periods. Our partners generally pay royalties or commercial milestones after the end of the calendar quarter in accordance with contractual terms. We present commercial milestone payments within license, collaboration and other revenue. License, collaboration and other revenue License Grants : For collaboration arrangements that include a grant of a license to our intellectual property, we consider whether the license grant is distinct from the other performance obligations included in the arrangement. Generally, we would conclude that the license is distinct if the customer is able to benefit from the license with the resources available to it. For licenses that are distinct, we recognize revenues from nonrefundable, upfront payments and other consideration allocated to the license when the license term has begun and we have provided all necessary information regarding the underlying intellectual property to the customer, which generally occurs at or near the inception of the arrangement. Milestone Payments : At the inception of the arrangement and at each reporting date thereafter, we assess whether we should include any milestone payments or other forms of variable consideration in the transaction price, based on whether a significant reversal of revenue previously recognized is not probable upon resolution of the uncertainty. Since milestone payments may become payable to us upon the initiation of a clinical study, filing for or receipt of regulatory approval or the first commercial sale of a product, we review the relevant facts and circumstances to determine when we should update the transaction price, which may occur before the triggering event. When we do update the transaction price for milestone payments, we allocate it on a relative standalone selling price basis and record revenue on a cumulative catch-up basis, which results in recognizing revenue for previously satisfied performance obligations in such period. As described further in Note 10, we recognized $50.0 million of milestones in the year ended December 31, 2020 because we had previously satisfied the performance obligation. If we update the transaction price before the triggering event, we recognize the increase in the transaction price as a contract asset. Our partners generally pay development milestones subsequent to achievement of the triggering event. Research and Development Services : For amounts allocated to our research and development obligations in a collaboration arrangement, we recognize revenue over time using a proportional performance model, representing the transfer of goods or services as we perform activities over the term of the agreement. Research and Development Expense Research and development costs are expensed as incurred and include salaries, benefits and other operating costs such as outside services, supplies and allocated overhead costs. We perform research and development activities for our drug candidates and technology development and for certain third parties under collaboration agreements. For our drug candidates and our internal technology development programs, we invest our own funds without reimbursement from a third party. Where we perform research and development activities under a joint development collaboration, such as our collaboration with BMS, we record the cost reimbursement from our partner as a reduction to research and development expense when reimbursement amounts are due to us under the agreement. We record an accrued expense for the estimated unbilled costs of our clinical study activities performed by third parties. The financial terms of these agreements are subject to negotiation, vary from contract to contract and may result in uneven payment flows to our vendors. Payments under the contracts depend on factors such as the achievement of certain events, successful enrollment of patients and completion of certain clinical trial activities. We generally recognize costs associated with the start-up and reporting phases of the clinical trials as incurred. We generally accrue costs associated with the treatment phase of clinical trials based on the estimated activities performed by our third party vendors, including our contract research organizations. We may also accrue expenses based on the total estimated cost of the treatment phase on a per patient basis and expense the per patient cost ratably over the estimated patient treatment period. In specific circumstances, such as for certain time-based costs, we recognize clinical trial expenses ratably over the service period, as we believe that this methodology may be more reflective of the timing of costs incurred. We record an accrued expense for the estimated costs of our contract manufacturing activities performed by third parties. The financial terms of these agreements are subject to negotiation, vary from contract to contract and may result in uneven payment flows to our vendors. Payments under the contracts include upfront payments and milestone payments, which depend on factors such as the achievement of the completion of certain stages of the manufacturing process. For purposes of recognizing expense, we assess whether we consider the production process to be sufficiently defined such that the resulting product can be considered the delivery of a good, as evidenced by predictive or contractually required yields in the production process or payment terms based on the actual yield, or the delivery of a service, where processes and yields are developing and less certain. If we consider the process to be the delivery of a good, we recognize expense when the drug product is delivered, or we otherwise bear risk of loss. If we consider the process to be the delivery of a service, we recognize expense based on our best estimates of the contract manufacturer’s progress towards completion of the stages in the contracts. We recognize and amortize upfront payments and accrue liabilities based on the specific terms of each arrangement. Certain arrangements may provide upfront payments for certain stages of the arrangement and milestone payments for the completion of certain stages, and, accordingly, we may record advance payments for services that have not been completed or goods not delivered and liabilities for stages where the contract manufacturer is entitled to a milestone payment. We capitalize advance payments for goods or services that will be used or rendered for future research and development activities and recognize expense as the related goods are delivered or services performed. We base our estimates on the best information available at the time. However, additional information may become available to us in the future which may allow us to make a more accurate estimate in fut |
Cash and Investments in Marketa
Cash and Investments in Marketable Securities | 12 Months Ended |
Dec. 31, 2022 | |
Cash and Cash Equivalents [Abstract] | |
Cash, Cash Equivalents, and Marketable Securities | Cash and Investments in Marketable Securities Cash and investments in marketable securities, including cash equivalents, are as follows (in thousands): Estimated Fair Value at December 31, December 31, Cash and cash equivalents $ 88,227 $ 25,218 Short-term investments 416,750 708,737 Long-term investments — 64,828 Total cash and investments in marketable securities $ 504,977 $ 798,783 We invest in liquid, high quality debt securities. Our investments in debt securities are subject to interest rate risk. To minimize the exposure due to an adverse shift in interest rates, we invest in securities with maturities of two years or less and maintain a weighted average maturity of one year or less. All of our long-term investments as of December 31, 2021 had maturities between one During the year ended December 31, 2022 we sold no available-for-sale securities. During the years ended December 31, 2021 and 2020, we sold available-for-sale securities totaling $11.5 million and $41.7 million, respectively. Gross realized gains and losses on those sales were not significant. We report our accrued interest receivable, which totaled $0.7 million and $1.4 million at December 31, 2022 and December 31, 2021, respectively, in other current assets on our Consolidated Balance Sheets. Our portfolio of cash and investments in marketable securities includes (in thousands): Fair Value December 31, 2022 December 31, 2021 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Fair Value Corporate notes and bonds 2 $ 84,377 $ — $ (855) $ 83,522 $ 278,121 Corporate commercial paper 2 345,125 25 (946) 344,204 478,629 Obligations of U.S. government agencies 2 — — — — 5,875 Available-for-sale investments 429,502 25 (1,801) 427,726 762,625 Money market funds 1 47,054 23,968 Certificates of deposit 2 21,399 10,940 Cash N/A 8,798 1,250 Total cash and investments in marketable securities $ 504,977 $ 798,783 At December 31, 2021, our gross unrealized losses totaled $0.7 million. Our gross unrealized gains were not significant. As of December 31, 2022 and 2021, we assessed our marketable securities with unrealized losses and concluded that the losses were not attributable to credit. Accordingly, we have not recorded an allowance for credit losses for these securities. At both December 31, 2022 and 2021, we had letter of credit arrangements in favor of our landlords and certain vendors totaling $7.5 million and $8.1 million, respectively. These letters of credit are secured by investments of similar amounts. |
Inventory
Inventory | 12 Months Ended |
Dec. 31, 2022 | |
Inventory Disclosure [Abstract] | |
Inventory | Inventory Inventory consists of the following (in thousands): December 31, 2022 2021 Raw materials $ 2,575 $ 3,166 Work-in-process 10,749 9,342 Finished goods 5,878 3,293 Total inventory $ 19,202 $ 15,801 |
Property, Plant and Equipment
Property, Plant and Equipment | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Property, Plant and Equipment Property, plant and equipment consists of the following (in thousands): December 31, 2022 2021 Building and leasehold improvements $ 74,889 $ 97,385 Laboratory equipment 24,243 42,704 Computer equipment and software 26,205 28,829 Manufacturing equipment 25,052 22,374 Furniture, fixtures, and other 4,263 10,094 Depreciable property, plant and equipment at cost 154,652 201,386 Less: accumulated depreciation (124,731) (148,039) Depreciable property, plant and equipment, net 29,921 53,347 Construction-in-progress 2,530 7,163 Property, plant and equipment, net $ 32,451 $ 60,510 Laboratory and manufacturing equipment, including construction-in-process, include assets that support both our manufacturing and research and development activities. Property, plant and equipment decreased significantly for the year ended December 31, 2022 as a result of our 2022 Restructuring Plan. As further disclosed in Note 11, we sold our research and development facility in India, we sold or disposed of laboratory equipment and certain computer software, and we recognized impairment charges for leasehold improvements and certain furniture and fixtures for spaces we seek to sublease. Depreciation and amortization expense for property, plant and equipment for the years ended December 31, 2022, 2021, and 2020 was $12.2 million, $13.0 million, and $12.5 million, respectively. |
Operating Leases
Operating Leases | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Operating Leases | Operating Leases Our leases consist of a Lease Agreement (the Mission Bay Lease) with ARE-San Francisco No. 19, LLC (ARE) for our 155,215 square foot corporate office and R&D facility located at 455 Mission Bay Boulevard South, San Francisco, California (the Mission Bay Facility) and a Lease Agreement (the Third Street Lease) with Kilroy Realty Finance Partnership, L.P. (Kilroy) for an additional 135,936 square foot of office space at 360 Third Street, San Francisco, California (the Third Street Facility). The following table presents key information regarding these leases (dollars in thousands): Mission Bay Facility Third Street Facility Lease commencement September 2017 June 2018 Lease term January 2030 January 2030 Renewal terms Two consecutive five One five • The monthly base rent for both facilities will escalate over the term of the lease at various intervals. • Both leases include various covenants, indemnities, defaults, termination rights, security deposits and other provisions customary for lease transactions of this nature. • During the term of the Mission Bay Lease, we are responsible for paying our share of operating expenses specified in the lease, including utilities, common area maintenance, insurance costs and taxes. • For the Third Street Lease, our fixed annual base rent on an industrial gross lease basis includes certain expenses and property taxes paid directly by the landlord. We have a one-time right of first offer with respect to certain additional rental space at the Third Street Facility. Due to our 2022 Restructuring Plan, during the year ended December 31, 2022, we recorded impairment charges of $54.6 million for our right-of-use assets which we are seeking to sublease. See Note 11 for additional information. We generally recognize lease expense for our operating leases on a straight-line basis over the lease term, and we continue to recognize lease expense on a straight-line basis for spaces for which we did not recognize an impairment. For spaces where we did recognize an impairment charge, the aggregate lease expense recognized over the remaining term is reduced by the amount of the impairment charge, but we recognize the remaining lease expense on an accelerated basis. The components of lease expense, which we include in operating expenses in our Consolidated Statements of Operations, were as follows (in thousands): Year Ended December 31, 2022 2021 2020 Operating lease expense $ 17,057 $ 19,153 $ 18,985 Variable lease expense 10,700 8,974 8,179 Total lease expense $ 27,757 $ 28,127 $ 27,164 During the years ended December 31, 2022, 2021 and 2010, we paid $20.1 million, $16.8 million and $16.2 million, respectively, of operating lease payments related to our lease liabilities, which we include in net cash used in operating activities in our Consolidated Statements of Cash Flows. As of December 31, 2022, the maturities of our operating lease liabilities were as follows (in thousands): Year ending December 31, 2023 $ 19,216 2024 21,572 2025 22,254 2026 22,958 2027 23,681 2028 and thereafter 51,732 Total lease payments 161,413 Less: portion representing interest (29,917) Operating lease liabilities 131,496 Less: current portion (18,667) Operating lease liabilities, less current portion $ 112,829 As of December 31, 2022, the weighted-average remaining lease term is 7.1 years and the weighted-average discount rate used to determine the operating lease liability was 5.8%. We have entered into subleases for certain spaces that provide recovery of $10.5 million in aggregate lease payments, as well as the subtenants' share of operating expenses. The reduction to lease expense for the year ended December 31, 2022, was not significant but will increase in future periods. |
Co-Development Agreement with S
Co-Development Agreement with SFJ Pharmaceuticals and Development Derivative Liability | 12 Months Ended |
Dec. 31, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Co-Development Agreement with SFJ Pharmaceuticals and Development Derivative Liability | Co-Development Agreement with SFJ Pharmaceuticals and Development Derivative Liability On February 12, 2021, we entered into a Co-Development Agreement (the SFJ Agreement) with SFJ Pharmaceuticals XII, L.P., a SFJ Pharmaceuticals Group company (SFJ), pursuant to which SFJ would pay up to $150.0 million in committed funding to support a Phase 2/3 study of bempegaldesleukin in combination with Keytruda ® (pembrolizumab) for first-line treatment of patients with metastatic or unresectable recurrent squamous cell carcinoma of the head and neck (the SCCHN Clinical Trial) whose tumors express PD-L1 (the SCCHN Indication). SFJ has primary responsibility for the clinical trial management of the SCCHN Clinical Trial, and we are the sponsor of the SCCHN Clinical Trial. The SFJ Agreement provided for us to pay up to $637.5 million in Success Payments in the event of FDA approval of bempegaldesleukin for the metastatic melanoma, the SCCHN Indication, or both, and in the event of FDA approval of one additional bempegaldesleukin indication. We presented the SFJ Agreement as a Development derivative liability in our Consolidated Balance Sheets, which we remeasured to fair value at each reporting date. As SFJ conducted the SCCHN Clinical Trial, we recorded non-cash research and development expense with a corresponding increase to the development derivative liability, and as SFJ remitted funding to us to support our internal costs of conducting the trial, we also recorded a corresponding increase to the development derivative liability. We presented the gain (loss) from the remeasurement as change in fair value of development derivative liability in our Consolidated Statements of Operations. The following table presents the changes in the development derivative liability: Year Ended December 31, Fair Value Hierarchy Level 2022 2021 Fair value as of December 31, 2021 and February 12, 2021 (inception), respectively 3 $ 27,726 $ — Non-cash research and development expense 4,951 16,703 Cash receipts from SFJ 750 3,000 Change in the fair value of development derivative liability (33,427) 8,023 Fair value at end of period 3 $ — $ 27,726 As of December 31, 2021, we valued the derivative using a scenario-based discounted cash flow method, whereby each scenario makes assumptions about the probability and timing of cash flows, and we discount such cash flows to present value using a risk-adjusted rate. The key inputs to the valuation included our estimates of the following: (i) the probability of the bempegaldesleukin trials meeting their primary endpoints, and if successful, the probability and timing of achieving FDA approval, (ii) the timing and the amount of costs incurred by SFJ for the SCCHN Clinical Trial, including the probability of early termination of the study based on an interim futility analysis, and (iii) each party’s cost of borrowing. As of March 31, 2022, due to the negative results of the metastatic melanoma trial and initial discussions with SFJ, we concluded that it was remote that SFJ and we would continue the SCCHN Clinical Trial. Accordingly, the fair value of the development derivative liability was reduced to zero as of March 31, 2022, and we recognized a corresponding gain in the Change in fair value of development derivative liability. As discussed in Note 1, on April 14, 2022, BMS and we decided to end the development for bempegaldesleukin in combination with Opdivo ® and that all other ongoing studies in the bempegaldesleukin program would be discontinued. We also announced that SFJ and we agreed to discontinue the SCCHN Clinical Trial. Accordingly, SFJ will not be entitled to any Success Payments, and SFJ has the responsibility to wind down the SCCHN Clinical Trial at its sole cost. SFJ has no right to seek reimbursement from us for any costs incurred for the SCCHN Clinical Trial. |
Liabilities Related to the Sale
Liabilities Related to the Sales of Future Royalties | 12 Months Ended |
Dec. 31, 2022 | |
Liability Related To Sale Of Potential Future Royalties [Abstract] | |
Liabilities Related to the Sales of Future Royalties | Liabilities Related to the Sales of Future Royalties On February 24, 2012, we entered into a purchase and sale agreement (the 2012 Purchase and Sale Agreement) with RPI Finance Trust (RPI), an affiliate of Royalty Pharma, pursuant to which we sold, and RPI purchased, our right to receive royalty payments (the 2012 Transaction Royalties) arising from the worldwide net sales, from and after January 1, 2012, of (a) CIMZIA ® , under our license, manufacturing and supply agreement with UCB Pharma (UCB), and (b) MIRCERA ® , under our license, manufacturing and supply agreement with F. Hoffmann-La Roche Ltd and Hoffmann-La Roche Inc. (together referred to as Roche). We received aggregate cash proceeds of $124.0 million for the 2012 Transaction Royalties. Although we sold all of our rights to receive royalties from the CIMZIA ® and MIRCERA ® products, as a result of our ongoing manufacturing and supply obligations related to the generation of these royalties, we continue to account for these royalties as revenue. We recorded the $124.0 million in proceeds from this transaction as a liability (the 2012 Royalty Obligation) that is amortized using the effective interest method over the estimated life of the 2012 Purchase and Sale Agreement as royalties from the CIMZIA ® and MIRCERA ® products are remitted directly to RPI. As of December 31, 2022, our prospective effective interest rate used to amortize the liability is 10%. On June 5, 2020, UCB served notice of a Declaratory Judgment of Patent Invalidity, filed in the United States District Court for the District of Delaware, seeking a declaration of invalidity of certain of our patents that we had licensed to UCB and pursued similar actions in other jurisdictions. On October 14, 2021, RPI and we entered into a Letter Agreement which permitted us to enter into a Settlement Agreement, effective October 13, 2021, with UCB to effect the negotiation between RPI and UCB in which UCB and RPI agreed to a reduction in the royalty term and annual decreases in the royalty rate over the remaining royalty term in exchange for UCB’s withdrawal of all of UCB’s litigation and challenges. We concluded that we should account for the decrease in royalty payments to RPI as a result of these agreements as a modification of our liability. Due to the significance of the change in the estimated royalty payments, we concluded that we should treat the modification as an extinguishment of the prior liability and recognize a new liability based on the revised royalty payments and term, discounted to fair value. Accordingly, we estimated the fair value to be approximately $84.7 million, reflecting a discount rate of 16.0%. As a result, we recognized a loss of $23.5 million on the revaluation of the prior liability in the three months ended December 31, 2021, and we wrote off the remaining $0.9 million of unamortized transaction costs. We present these charges in Loss on revaluation of liability related to the sale of future royalties line in our Consolidated Statement of Operations. On December 16, 2020, we entered into a purchase and sale agreement (the 2020 Purchase and Sale Agreement) with entities managed by Healthcare Royalty Management, LLC (collectively, HCR). Pursuant to the 2020 Purchase and Sale Agreement, we agreed to sell to HCR certain of our rights to receive royalty payments (the 2020 Transaction Royalties) arising from the worldwide net sales, from and after October 1, 2020 until such time that certain return thresholds are met as described below, of (a) MOVANTIK ® under that certain License Agreement, dated September 20, 2009, by and between Nektar and AstraZeneca AB, as amended, (b) ADYNOVATE ® under that certain Exclusive Research, Development, License and Manufacturing and Supply Agreement, dated September 26, 2005, by and among Nektar, Baxalta US Inc. and Baxalta GmbH, as amended, (c) REBINYN ® under that certain Settlement and License Agreement, dated December 21, 2016, by and among Nektar, Novo Nordisk Inc., Novo Nordisk A/S and Novo Nordisk A/G and (d) licensed products under that certain Right to Sublicense Agreement, dated October 27, 2017, by and among Nektar, Baxalta Incorporated, Baxalta US Inc. and Baxalta GmbH. The 2020 Purchase and Sale Agreement will automatically expire, and the payment of the 2020 Transaction Royalties to HCR will cease, when HCR has received payments of the 2020 Transaction Royalties equal to $210.0 million (the 2025 Threshold), if the 2025 Threshold is achieved on or prior to December 31, 2025, or $240.0 million, if the 2025 Threshold is not achieved on or prior to December 31, 2025 (or, if earlier, the date on which the last royalty payment under the relevant license agreements is made). If HCR has received payments of the 2020 Transaction Royalties equal to at least $208.0 million on or prior to December 31, 2025, we have the option to pay the difference between the 2025 Threshold and such 2020 Transaction Royalties, and the 2025 Threshold will be met and the 2020 Purchase and Sale Agreement will expire. After the 2020 Purchase and Sale Agreement expires, all rights to receive the 2020 Transaction Royalties return to Nektar. On December 30, 2020, we received aggregate cash proceeds of $150.0 million for the 2020 Transaction Royalties. As part of the sale, we incurred approximately $3.8 million in transaction costs, which will be amortized to interest expense over the estimated life of the 2020 Purchase and Sale Agreement. Although we sold all of our rights to receive royalties from these products up to the cap, as a result of the limits on the 2020 Transaction Royalties to be received by HCR and our ongoing manufacturing and supply obligations related to the generation of these royalties, we will continue to account for these non-cash royalties as revenue, commencing with royalties for the three months ended December 31, 2020, to be received by HCR in the first quarter of 2021. We recorded the $150.0 million in proceeds from this transaction as a liability (the 2020 Royalty Obligation) that will be amortized using the effective interest method over the estimated life of the 2020 Purchase and Sale Agreement. As of December 31, 2022, our prospective effective interest rate used to amortize the liability is 20%. The following table shows the activity within the liability account of each arrangement (in thousands): Year-Ended December 31, 2022 Period from inception to December 31, 2022 2012 Purchase and Sale Agreement 2020 Purchase and Sale Agreement Total 2012 Purchase and Sale Agreement 2020 Purchase and Sale Agreement Total Liabilities related to the sales of future royalties—beginning $ 78,282 $ 120,062 $ 198,344 $ — $ — $ — Royalty monetization proceeds — — — 124,000 150,000 274,000 Non-cash royalty revenue (33,865) (35,929) (69,794) (316,523) (86,722) (403,245) Non-cash interest expense 10,750 18,161 28,911 234,168 39,016 273,184 Payments to RPI — — — (10,000) — (10,000) Loss on revaluation of liability related to the sale of future royalties — — 23,522 — 23,522 Liabilities related to the sales of future royalties – ending balance 55,167 102,294 157,461 55,167 102,294 157,461 Less: unamortized transaction costs — (2,083) (2,083) — (2,083) (2,083) Liabilities related to the sales of future royalties, net $ 55,167 $ 100,211 $ 155,378 $ 55,167 $ 100,211 $ 155,378 Pursuant to the 2012 Purchase and Sale Agreement, in March 2014 and March 2013, we were required to pay RPI $7.0 million and $3.0 million, respectively, as a result of worldwide net sales of MIRCERA ® for the 12 month periods ended December 31, 2013 and 2012 not reaching certain minimum thresholds. The 2012 Purchase and Sale Agreement does not include any other potential payments related to minimum net sales thresholds and, therefore, we do not expect to make any further payments to RPI related to this agreement. As royalties are remitted to RPI and HCR by our licensees, the balances of the respective Royalty Obligations will be effectively repaid over the lives of the agreements. To determine the amortization of the Royalty Obligations, we are required to estimate the total amount of future royalty payments to be received by RPI and HCR, respectively. The sum of these amounts less the net proceeds we received will be recorded as non-cash interest expense, as well as the loss on the revaluation described above, over the lives of the respective Royalty Obligations. We periodically assess the estimated royalty payments to RPI and HCR from our licensees and to the extent the amount or timing of such payments is materially different than our original estimates, we will prospectively adjust the imputed interest rate and the related amortization of the appropriate Royalty Obligation. There are a number of factors that could materially affect the amount and timing of royalty payments from our licensees, most of which are not within our control. Such factors include, but are not limited to, changing standards of care, the introduction of competing products, manufacturing or other delays, biosimilar competition, intellectual property matters, adverse events that result in governmental health authority imposed restrictions on the use of the drug products, significant changes in foreign exchange rates as the royalties remitted to RPI or HCR are made in U.S. dollars (USD) while significant portions of the underlying sales of the products of our licensees are made in currencies other than USD, and other events or circumstances that could result in reduced royalty payments from our licensees, all of which would result in a reduction of non-cash royalty revenues and the non-cash interest expense over the life of the respective Royalty Obligation. Conversely, for the 2012 Purchase and Sale Agreement, if sales of these products are more than expected, the non-cash royalty revenues and the non-cash interest expense recorded by us would be greater over the term of the 2012 Royalty Obligation. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Purchase Commitments In the normal course of business, we enter into various firm purchase commitments related to contract manufacturing, clinical development and certain other items. As of December 31, 2022, these commitments were not significant. Legal Matters From time to time, we are involved in lawsuits, arbitrations, claims, investigations and proceedings, consisting of intellectual property, commercial, employment and other matters, which arise in the ordinary course of business. We make provisions for liabilities when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Such provisions are reviewed at least quarterly and adjusted to reflect the impact of settlement negotiations, judicial and administrative rulings, advice of legal counsel, and other information and events pertaining to a particular case. Litigation is inherently unpredictable. If any unfavorable ruling were to occur in any specific period, there exists the possibility of a material adverse impact on the results of our operations for that period and on our cash flows and liquidity. We have recorded no liability for any litigation matters in our Consolidated Balance Sheets at either December 31, 2022 or December 31, 2021. Foreign Operations We have operated in a number of foreign countries, but we are in the process of winding down our foreign subsidiaries. As of December 31, 2022, we no longer have any foreign properties and only a few remaining employees in foreign locations. We are subject to numerous local laws and regulations that can result in claims made by foreign government agencies or other third parties that are often difficult to predict even after the application of good faith compliance efforts. Indemnification Obligations During the course of our normal operating activities, we have agreed to certain contingent indemnification obligations as further described below. The term of our indemnification obligations is generally perpetual. There is generally no limitation on the potential amount of future payments we could be required to make under these indemnification obligations. To date, we have not incurred significant costs to defend lawsuits or settle claims based on our indemnification obligations. If any of our indemnification obligations is triggered, we may incur substantial liabilities. Because the aggregate amount of any of these potential indemnification obligations is not a stated amount, we cannot reasonably estimate the overall maximum amount of any such obligations. We have recorded no liabilities for these obligations in our Consolidated Balance Sheets at either December 31, 2022 or December 31, 2021. Indemnifications in Connection with Commercial Agreements As part of our collaboration agreements with our partners related to the license, development, manufacture and supply of drugs and PEGylation materials based on our proprietary technologies and drug candidates, we generally agree to defend, indemnify and hold harmless our partners from and against third party liabilities arising out of the agreement, including product liability (with respect to our activities) and infringement of intellectual property to the extent the intellectual property is developed by us and licensed to our partners. The term of these indemnification obligations is generally perpetual commencing after execution of the agreement. There is generally no limitation on the potential amount of future payments we could be required to make under these indemnification obligations. From time to time, we enter into other strategic agreements such as divestitures and financing transactions pursuant to which we are required to make representations and warranties and undertake to perform or comply with certain covenants. For example, we made certain intellectual property representations in connection with our RPI and HCR transactions, however, the time limitation we have to indemnify RPI with respect to any breach of these intellectual property-based representations and warranties has passed. In the event it is determined that we breached certain of the representations and warranties or covenants made by us in any such agreements or certain express indemnification provisions are applicable, we could incur substantial indemnification liabilities depending on the timing, nature, and amount of any such claims. To date, we have not incurred any costs to defend lawsuits or settle claims related to these indemnification obligations, nor any breaches of representations or warranties or covenants. Because the aggregate amount of any potential indemnification obligation is not a stated amount, we cannot reasonably estimate the overall maximum amount of any such obligations. Indemnification of Underwriters and Initial Purchasers of our Securities In connection with our sale of equity we have agreed to defend, indemnify and hold harmless our underwriters or initial purchasers, as applicable, as well as certain related parties from and against certain liabilities, including liabilities under the Securities Act of 1933, as amended. Director and Officer Indemnifications As permitted under Delaware law, and as set forth in our Certificate of Incorporation and our Bylaws, we indemnify our directors, executive officers, other officers, employees, and other agents for certain events or occurrences that may arise while in such capacity. The maximum potential amount of future payments we could be required to make under this indemnification is unlimited; however, we have insurance policies that may limit our exposure and may enable us to recover a portion of any future amounts paid. Assuming the applicability of coverage, the willingness of the insurer to assume coverage, and subject to certain retention, loss limits and other policy provisions, we believe any obligations under this indemnification would not be material, other than retention of up to $10.0 million per incident for merger and acquisition related claims, $10.0 million per incident for securities related claims and $10.0 million per incident for non-securities related claims per our insurance policy. However, no assurances can be given that the covering insurers will not attempt to dispute the validity, applicability, or amount of coverage without expensive litigation against these insurers, in which case we may incur substantial liabilities as a result of these indemnification obligations. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders’ Equity As discussed in Note 10, on April 3, 2018, we completed the issuance and sale of 8,284,600 shares of our common stock under a Share Purchase Agreement with BMS. These shares are unregistered and subject to certain lock-up and stand-still provisions for a five-year period. Prior to the filing of this Annual Report on Form 10-K, we had an effective shelf registration statement on Form S-3 (the 2021 Shelf Registration Statement) on file with the SEC. The 2021 Shelf Registration Statement permitted the offering, issuance and sale by us of up to an aggregate offering price of $300.0 million of common stock, preferred stock, debt securities and warrants in one or more offerings and in any combination, all of which could be offered, issued and sold in “at-the-market” sales pursuant to an equity distribution agreement with Cowen and Company, LLC (the Equity Distribution Agreement). No securities were sold under the 2021 Shelf Registration Statement or the Equity Distribution Agreement. As a result of the recent decline in our market capitalization, we are no longer a well-known seasoned issuer. Accordingly, the 2021 Shelf Registration Statement will no longer be available for us to offer and sell securities pursuant to the 2021 Shelf Registration Statement following the filing of this Annual Report on Form 10-K. As of December 31, 2022, shares of common stock reserved for future issuance are as follows (in thousands): Stock options, RSUs and PSUs outstanding 23,589 Shares available for future grant under the 2017 Performance Incentive Plan 2,973 Shares available for issuance under the employee stock purchase plan 841 Total common stock reserved for issuance 27,403 Our accumulated other comprehensive loss as of December 31, 2022, includes $1.8 million for net unrealized losses on our available for sale securities and $5.1 million for accumulated net translation losses primarily from our subsidiary in India. |
License and Collaboration Agree
License and Collaboration Agreements | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
License and Collaboration Agreements | License and Collaboration Agreements We have entered into various collaboration agreements including license agreements and collaborative research, development and commercialization agreements with various pharmaceutical and biotechnology companies. Under these collaboration arrangements, we are entitled to receive license fees, upfront payments, milestone and other contingent payments, royalties, sales milestone payments, and payments for the manufacture and supply of our proprietary PEGylation materials and/or reimbursement for research and development activities. We generally include our costs of performing these services in research and development expense, except for costs for product sales to our collaboration partners which we include in cost of goods sold. We analyze our agreements to determine whether we should account for the agreements within the scope of ASC 808, and, if so, we analyze whether we should account for any elements under ASC 606. In accordance with our collaboration agreements, we recognized license, collaboration and other revenue as follows (in thousands): Year Ended December 31, Partner Agreement 2022 2021 2020 Bristol-Myers Squibb Bempegaldesleukin $ — $ — $ 50,000 Other 1,913 436 5,849 License, collaboration and other revenue $ 1,913 $ 436 $ 55,849 Bristol-Myers Squibb (BMS): Bempegaldesleukin (previously referred to as NKTR-214) On February 13, 2018, we entered into a Strategic Collaboration Agreement (the BMS Collaboration Agreement) and a Share Purchase Agreement with BMS, both of which became effective on April 3, 2018. Pursuant to the BMS Collaboration Agreement, we and BMS have jointly developed bempegaldesleukin in combination with BMS’s Opdivo ® . The parties share the internal and external development costs for bempegaldesleukin in combination regimens based on each party’s relative ownership interest in the compounds included in the regimens. In accordance with the agreement, the parties share development costs for bempegaldesleukin in combination with Opdivo ® , 67.5% of costs to BMS and 32.5% to Nektar. The parties share costs for the manufacturing and commercialization of bempegaldesleukin, 35% of the costs to BMS and 65% to Nektar. Upon the effective date of the BMS Collaboration Agreement in April 2018, BMS paid us a non-refundable upfront cash payment of $1.0 billion and purchased 8,284,600 shares of our common stock pursuant to the Share Purchase Agreement for total additional cash consideration of $850.0 million. In 2020, we received non-refundable milestone payments of $50.0 million in aggregate for the first patient, first visit in the registrational trials in muscle-invasive bladder cancer and adjuvant melanoma. As discussed in Note 1, on March 14, 2022, we announced our registrational trial in metastatic melanoma did not meet its primary endpoints and that BMS and we decided to discontinue the trials in metastatic melanoma and adjuvant melanoma. On April 14, 2022, we announced that our registrational trials in each of renal cell carcinoma and cisplatin-ineligible, locally advanced or metastatic urothelial cancer did not meet their respective primary endpoints. Due to these results, BMS and we decided that these studies and all other ongoing studies in the program will be discontinued. The decision to terminate the program does not affect the cost-sharing provisions under the BMS Collaboration Agreement. However, without further development of bempegaldesleukin, we will no longer be eligible for the development, regulatory and sales milestones under the arrangement. We determined that the BMS Collaboration Agreement falls within the scope of ASC 808. As mentioned above, BMS shares certain percentages of development costs incurred by us and we share certain percentages of development costs incurred by BMS. We consider these activities to represent collaborative activities under ASC 808 and we recognize such cost sharing proportionately with the performance of the underlying services. We recognized BMS’ reimbursement of our expenses as a reduction of research and development expense and our reimbursement of BMS’ expenses as research and development expense. As discussed in Note 11, we terminated the development of bempegaldesleukin, and therefore, in the second quarter of 2022, we began reporting clinical trial, other third-party costs and employee costs for the bempegaldesleukin program in restructuring, impairment and other costs of program. Accordingly, during the year ended December 31, 2022, we recorded $45.7 million for the net reimbursement from BMS, of which we recorded $24.9 million as a reduction of research and development expense for the first quarter of 2022, and $20.8 million as a reduction of restructuring, impairment and other costs of terminated program for the remaining three quarters of 2022. During the years ended December 31, 2021 and 2020, we recorded $101.5 million and $128.2 million, respectively, as a reduction of research and development expense for the net reimbursement from BMS. As of December 31, 2022, we have recorded an unbilled receivable of $4.2 million from BMS in accounts receivable in our Consolidated Balance Sheet, which we received in February 2023. Eli Lilly and Company (Lilly): NKTR-358 On July 23, 2017, we entered into a worldwide license agreement (the Lilly Agreement) with Eli Lilly and Company (Lilly) to co-develop rezpegaldesleukin, a novel immunological drug candidate that we invented, pursuant to which we received an initial payment of $150.0 million and are eligible for up to $250.0 million in additional development and regulatory milestones. Although we are entitled to significant development milestones under this arrangement if Lilly decides to proceed to Phase 3 development, we have excluded such milestones from the transaction price due to the significant uncertainties involved with clinical development. We re-evaluate the transaction price at each reporting period and as uncertain events are resolved or other changes in circumstances occur. We are currently in Phase 1B and Phase 2 development, where we share costs with 75% of the costs borne by Lilly and 25% of the costs borne by us. Lilly is responsible for the costs of Phase 3 development, but we retain the option to contribute up to 25% of the costs of Phase 3 development on an indication-by-indication basis in order for us to achieve the maximum royalty level under the Lilly Agreement, and further , if approved, we will have the opportunity to receive a royalty rate up to the low twenties percent based upon our Phase 3 development cost contribution and the level of annual global product sales. Lilly will be responsible for all costs of global commercialization, and we will have an option to co-promote in the U.S. under certain conditions. A portion of the development milestones may be reduced by 50% under certain conditions, related to the final formulation of the approved product and the timing of prior approval (if any) of competitive products with a similar mechanism of action, which could reduce these milestone payments by 75% if both conditions occur. The Lilly Agreement will continue until Lilly no longer has any royalty payment obligations or, if earlier, the termination of the agreement in accordance with its terms. The Lilly Agreement may be terminated by Lilly for convenience, and may also be terminated under certain other circumstances, including material breach. On February 23, 2023, we announced the topline data from the Phase 2 study of rezpegaldesleukin in adult patients with systemic lupus erythematosus (SLE) (Phase 2 Lupus Study). The primary endpoint of the Phase 2 Lupus Study was not met, and Lilly has notified us that it does not intend to advance rezpegaldesleukin into Phase 3 development for SLE. Baxalta Inc. / Takeda Pharmaceutical Ltd.: Hemophilia We are a party to an exclusive research, development, license and manufacturing and supply agreement with Baxalta Inc. (Baxalta), a subsidiary of Takeda Pharmaceutical Company Ltd. (Takeda), entered into in September 2005 to develop products designed to improve therapies for Hemophilia A patients using our PEGylation technology, resulting in the approval of ADYNOVATE ® by the FDA in 2015, which is now marketed in the U.S., the European Union, and many other countries. We are entitled to royalties based on worldwide net sales of ADYNOVATE ® and a sales milestone upon achievement of an annual worldwide net sales target. We are responsible for supplying Takeda with its requirements for our proprietary materials. Takeda is responsible for all clinical development, regulatory, and commercialization expenses. The agreement is terminable by the parties under customary conditions. In October 2017, we entered into a right to sublicense agreement with Baxalta, under which we granted to Baxalta the right to grant a nonexclusive sublicense to certain patents that were previously exclusively licensed to Baxalta under our 2005 agreement. Under the right to sublicense agreement, we are entitled to single digit royalty payments based upon net sales of the products covered under the sublicense throughout the term of the agreement. As described in Note 7, we sold our rights to receive these royalties to HCR pursuant to the 2020 Purchase and Sale Agreement. AstraZeneca AB : MOVANTIK ® (naloxegol oxalate) In September 2009, we entered into an agreement with AstraZeneca AB (AstraZeneca) under which we granted AstraZeneca a worldwide, exclusive license under our patents and other intellectual property to develop, market, and sell MOVANTIK ® . AstraZeneca is responsible for all research, development and commercialization costs and related decisions for MOVANTIK ® . Through various sublicense arrangements to RedHill Biopharma, Kyowa Hakko Kirin Co. Ltd. and Knight Therapeutics, as of April 2020, AstraZeneca has sub-licensed all of its global commercialization rights. Our rights, including the royalty rate, royalty term and future potential sales milestones, remain unchanged as a result of these sublicenses. We are generally entitled to escalating double-digit royalty payments and sales milestones for net sales of MOVANTIK ® . As described in Note 7, we sold our rights to receive these royalties to HCR pursuant to the 2020 Purchase and Sale Agreement. Other We have other collaboration agreements that have resulted in commercialized products for our collaborations partners. Under these agreements, we may sell our proprietary PEGylation materials for use in these products, and we are entitled to receive royalties based on net sales of these products as well as sales milestones. Additionally, we have a collaboration agreement for a product under development, under which we are entitled to up to a total of $40.0 million of regulatory milestones, as well as royalties based on net sales, if approved, and sales milestones upon achievement of an annual net sales targets. However, given the current phase of development of the product under this collaboration agreement, we cannot estimate the probability or timing of achieving these milestones, and, therefore, have excluded all development milestones from the transaction price for this agreement. |
Restructuring, Impairment and O
Restructuring, Impairment and Other Costs of Terminated Program | 12 Months Ended |
Dec. 31, 2022 | |
Restructuring and Related Activities [Abstract] | |
Restructuring, Impairment and Other Costs of Terminated Program | Restructuring, Impairment and Other Costs of Terminated Program As discussed in Note 1, because our registrational trials in bempegaldesleukin did not meet their primary endpoints, we decided to discontinue all of our ongoing clinical trials of bempegaldesleukin in combination with checkpoint inhibitors and tyrosine kinase inhibitors, and, during April 2022, we announced the 2022 Restructuring Plan to prioritize key Phase 2 development programs, to advance our early stage research pipeline and to reduce our workforce by approximately 70% from approximately 735 to approximately 225 employees. In connection with these events, we reported the following costs in restructuring, impairment and other costs of terminated program for the year ended December 31, 2022: • Clinical trial expense, other third-party costs and employee costs for the wind down of the bempegaldesleukin program, net of the reimbursement from BMS; • Severance and related benefit costs pursuant to the 2022 Restructuring Plan; • Impairment of sublease assets, including right-of-use assets and property, plant and equipment resulting from the 2022 Restructuring Plan, reflecting excess office and laboratory leased spaces in San Francisco, CA; • (Gain) loss on sale or disposal of property, plant and equipment; and • Contract termination and other costs associated with the wind down of the bempegaldesleukin program. In prior periods through March 31, 2022, we reported the clinical trial costs, other third-party costs and employee costs related to the bempegaldesleukin program primarily in research and development expense. Restructuring, impairment and other costs of terminated program includes the following (in thousands): Year Ended December 31, 2022 Clinical trial expense, other third-party and employee costs for the wind down of the bempegaldesleukin program $ 31,693 Severance and benefit expense 30,904 Impairment of right-of-use assets and property, plant and equipment 65,761 (Gain) loss on sale or disposal of property, plant and equipment, net (3,326) Contract termination and other restructuring costs 10,898 Restructuring, impairment and other costs of terminated program $ 135,930 Clinical trial expense, other third-party and employee costs for the wind down of the bempegaldesleukin program The clinical costs associated with winding down the bempegaldesleukin program primarily include clinical trial and other development expenses to transition patients from our sponsor-led trials to standard of care or our post-trial access program, as well as direct employee costs supporting these efforts. We recorded a reduction of expense of $20.8 million for the net reimbursement from BMS primarily for such costs. Severance and Benefit Expense Employees affected by the reduction in force under our 2022 Restructuring Plan were entitled to receive severance payments and certain Company funded benefits. We recognized severance and benefit expense in full for employees who were notified of their termination in April 2022 and had no requirements for future service, and we recognized expense for employees who were required to render services to receive their severance ratably over the service period. This service period began in April 2022 with all affected employees terminated on or before December 31, 2022, and therefore we will recognize no further expense. The following table provides details regarding the severance and other termination benefit expense. We present the liability, which we paid in January 2023, in accrued compensation on our Consolidated Balance Sheet (in thousands): Year Ended December 31, 2022 No service period Service period required Total Liability balance as of March 31, 2022 $ — $ — $ — Expense recognized during the period 22,993 7,911 30,904 Payments during the period (22,993) (4,612) (27,605) Liability balance as of December 31, 2022 $ — $ 3,299 $ 3,299 Impairment of Right-of-Use Assets and Property, Plant and Equipment In connection with our 2022 Restructuring Plan, we have consolidated our San Francisco operations in our Mission Bay Facility, and we have vacated our Third St. Facility and certain laboratory and office spaces at our Mission Bay Facility. We are seeking to sublease the vacated spaces, while still maintaining sufficient office and laboratory space to allow our team to develop our proprietary programs. As a result of these plans, we reviewed each of our vacated spaces for impairment as of May 31, 2022, when management had determined which spaces we would seek to sublease, and subsequently at each reporting date or as facts and circumstances changed. As part of our impairment evaluation of each vacated space, we separately compared the estimated undiscounted income to the net book value of the related long-term assets, which include right-of-use assets and certain property, plant and equipment, primarily leasehold improvements (collectively, sublease assets). We estimated sublease income using market participant assumptions, including the length of time to enter into a sublease and sublease payments, which we evaluated using sublease negotiations or agreements when applicable, current real estate trends and market conditions. If such income exceeded the net book value of the related assets, we did not record an impairment charge. Otherwise, we recorded an impairment charge by reducing the net book value of the assets to their estimated fair value, which we determined by discounting the estimated sublease cash flows using the estimated borrowing rate of a market participant subtenant, which we estimated to be 6.4% and 7.9% as of May 31, 2022 and December 31, 2022, respectively. We recorded the substantial majority of our impairment charges as of May 31, 2022, primarily reflecting decreased rental recovery rates for our office lease space on Third St. However, as the office lease market in San Francisco deteriorated after May 31, 2022 in the fourth quarter of 2022, we recorded an additional impairment charge of $12.0 million in the three months ended December 31, 2022, for the Third St. Facility, reflecting an increase in our estimated time to enter into a sublease. We recorded impairment charges as follows (in thousands): Year Ended December 31, 2022 Operating Lease Right-of-Use Assets Property, Plant and Equipment Total Net book value of impaired sublease assets as of May 31, 2022 $ 72,481 $ 16,348 $ 88,829 Less: Fair value of impaired sublease assets — Level 3 of Fair Value Hierarchy (16,174) (4,780) (20,954) Book value in excess of fair value 56,307 11,568 67,875 Less: Amounts recorded as amortization between May 31 and December 31, 2022 for Third St. facility (1,717) (397) (2,114) Total impairment of sublease assets $ 54,590 $ 11,171 $ 65,761 We may record adjustments to impairment expense in future periods as we enter into sublease agreements or update our estimates as additional information becomes available to us. (Gain) Loss on Sale or Disposal of Property, Plant and Equipment, Net In connection with our 2022 Restructuring Plan, we terminated all research and development activities at our owned facility in India, which we sold in December 2022. We also recognized losses including excess equipment, net of sale proceeds, and the disposal of software to support the commercialization of bempegaldesleukin. We recorded the gains and losses as follows (in thousands): Year Ended December 31, 2022 Proceeds from sales $ 13,196 Net book value of assets 9,870 Total (gain) loss on sale or disposal of property, plan and equipment, net (3,326) |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation 2017 Performance Incentive Plan Our 2017 Performance Incentive Plan (2017 Plan) provides for the issuance of our common stock to members of the Board of Directors, officers or employees, certain consultants and advisors and our subsidiaries. Our 2017 Plan has been amended and restated such that an aggregate 39,200,000 shares have been authorized for issuance as of December 31, 2022, including 5,000,000 shares that were approved on June 8, 2022. Under the 2017 Plan, we may issue stock options, restricted stock, performance stock, stock units, stock appreciation rights and other similar types of awards. When the 2017 Plan was approved on June 14, 2017, any shares of our common stock that were available for issuance under our 2012 Performance Incentive Plan (the 2012 Plan) ceased to be available for future grants. However, options and RSUs granted under the 2012 Plan remained outstanding, and any options or RSUs that were cancelled or forfeited became available for issuance under the 2017 Plan. Shares issued for RSUs, PSUs or any other “full-value award” are counted against the share limit as 1.5 shares for every one share granted in connection with the award. We have granted non-qualified stock options, RSUs and PSUs to employees, officers, and non-employee directors. For our employees, the requisite service period is generally four years for stock options, and three years for RSUs and PSUs. For our directors, the requisite service is generally one year for stock options and RSUs. The maximum term of a stock option is eight years from the date of grant. The per share exercise price of an option generally may not be less than the fair market value of a share of our common stock on the NASDAQ Stock Market on the date of grant. Under our Change in Control Plan (the CIC Plan), in the event of a change of control of Nektar and a subsequent termination of employment initiated by us or a successor company other than for Cause (as defined in the CIC Plan) within twelve months following a change of control, our employees are entitled to full acceleration of their unvested equity awards. Our Chief Executive Officer, Senior Vice Presidents and Vice Presidents (including Principal Fellows) are also entitled to full acceleration of unvested equity awards if the termination is initiated by the employee for a Good Reason Resignation (as defined in the CIC Plan) within twelve months following a change of control. Additionally, non-employee directors would also be entitled to full acceleration of vesting of all outstanding stock awards in the event of a change of control transaction. Employee Stock Purchase Plan Under the terms of our Employee Stock Purchase Plan (ESPP), employees may purchase shares of our common stock based on a percentage of their compensation subject to certain limits. Shares are purchased at 85% of the lower of the closing price on either the first day or last day of each six-month offering period. An aggregate 3,500,000 shares have been authorized for issuance under our ESPP. Stock-Based Compensation Expense We recognize total stock-based compensation expense in our Consolidated Statements of Operations as follows (in thousands): Year Ended December 31, 2022 2021 2020 Cost of goods sold $ 2,824 $ 2,779 $ 2,825 Research and development 27,727 54,821 57,116 General and administrative 24,488 37,074 33,295 Restructuring, impairment and other costs of terminated program 2,281 — 1,025 Total stock-based compensation $ 57,320 $ 94,674 $ 94,261 Stock-based compensation expense resulting from PSUs and our ESPP was not significant in the years ended December 31, 2022, 2021, and 2020. As of December 31, 2022, total unrecognized compensation costs of $83.1 million related to unvested stock-based compensation awards are expected to be recognized as expense over a weighted-average period of 2.3 years. Black-Scholes Assumptions The following table lists the Black-Scholes option-pricing model assumptions used to calculate the fair value of employee and director stock options, as well as the resulting grant-date fair value: Year Ended December 31, 2022 2021 2020 Average risk-free interest rate 2.9 % 1.2 % 0.4 % Dividend yield 0.0 % 0.0 % 0.0 % Average volatility factor 77.9 % 63.8 % 64.1 % Weighted-average expected life 5.6 years 5.5 years 5.6 years Weighted-average grant-date fair value of options granted $ 3.18 $ 8.07 $ 10.70 The average risk-free interest rate is based on the U.S. treasury yield curve in effect at the time of grant for periods commensurate with the expected life of the stock-based award. We have never paid dividends, nor do we expect to pay dividends in the foreseeable future; therefore, we used a dividend yield of zero. Our estimate of expected volatility is based on the daily historical trading data of our common stock at the time of grant over a historical period commensurate with the expected life of the stock-based award. We estimated the weighted-average expected life based on the contractual and vesting terms of the stock options, as well as historical cancellation and exercise data. Summary of Stock Option Activity The table below presents a summary of stock option activity under our equity incentive plans (in thousands, except for price per share and contractual life information): Number of Shares Weighted- Average Exercise Price per Share Weighted- Average Remaining Contractual Life (in Years) Aggregate Intrinsic Value(1) Outstanding at December 31, 2021 13,542 $ 23.62 Options granted 6,276 4.76 Options exercised (15) 12.43 Options forfeited & canceled (5,715) 20.73 Outstanding at December 31, 2022 14,088 $ 16.40 5.71 $ — Exercisable at December 31, 2022 6,029 27.82 3.60 $ — _______________________________________________________________ (1) Aggregate intrinsic value represents the difference between the exercise price of the option and the closing market price of our common stock on December 31, 2022. The intrinsic value of options exercised during the year ended December 31, 2022 was not significant and totaled $17.3 million and $15.9 million during the years ended December 31, 2021 and 2020, respectively. Summary of RSU Activity A summary of RSU award activity is as follows (in thousands except for per share amounts): Units Issued Weighted- Unvested at December 31, 2021 9,930 $ 16.80 Granted 7,708 4.14 Vested and released (2,872) 17.64 Forfeited and canceled (5,454) 15.68 Unvested at December 31, 2022 9,312 $ 6.81 The weighted-average grant-date fair values of RSUs granted during the years ended December 31, 2022, 2021 and 2020 were $4.14, $14.68 and $19.24, respectively. The fair value of RSU's that vested in the years ended December 31, 2022, 2021 and 2020 totaled $17.5 million, $45.3 million and $33.3 million, respectively. 401(k) Retirement Plan We sponsor a 401(k) retirement plan whereby eligible employees may elect to contribute up to the lesser of 60% of their annual compensation or the statutorily prescribed annual limit allowable under Internal Revenue Service regulations. The 401(k) plan permits us to make matching contributions on behalf of all participants, up to a maximum of $12,000 per participant for the year ended December 31, 2022, and up to a maximum of $6,000 per participant for the years ended December 31, 2021 and 2020. For the years ended December 31, 2022, 2021, and 2020, we recognized $2.5 million, $3.6 million and $3.5 million, respectively, of compensation expense in connection with our 401(k) retirement plan. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Loss before provision for income taxes includes the following components (in thousands): Year Ended December 31, 2022 2021 2020 Domestic $ (371,900) $ (524,440) $ (445,370) Foreign 6,917 1,160 1,423 Loss before provision for income taxes $ (364,983) $ (523,280) $ (443,947) Provision for Income Taxes The provision for income taxes consists of the following (in thousands): Year Ended December 31, 2022 2021 2020 Current: Federal $ — $ — $ — State (608) 50 165 Foreign 1,115 609 364 Total current income tax expense 507 659 529 Deferred: Federal — — — State — — — Foreign 2,708 (102) (36) Total deferred income tax expense 2,708 (102) (36) Provision for income taxes $ 3,215 $ 557 $ 493 Our income tax provision related to continuing operations differs from the amount computed by applying the statutory income tax rate of 21% to our pretax loss as follows (in thousands): Year Ended December 31, 2022 2021 2020 Income tax benefit at federal statutory rate $ (76,647) $ (109,889) $ (93,229) Research credits (987) (4,727) (3,081) Change in valuation allowance 51,108 97,914 87,060 Expiration of net operating loss carryforwards 12,348 286 286 Stock-based compensation 15,778 6,627 7,929 Non-cash interest expense on liability related to sales of future royalties 6,071 9,936 6,356 Non-cash royalty revenue related to sales of future royalties (7,112) (7,891) (7,967) Loss on revaluation of liability related to the sale of future royalties — 4,940 — Other 2,656 3,361 3,139 Provision for income taxes $ 3,215 $ 557 $ 493 Deferred Tax Assets and Liabilities Deferred income taxes reflect the net tax effects of loss and credit carryforwards and temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. We measure deferred tax assets and liabilities based on the rates at which they are expected to reverse in the future. Significant components of our deferred tax assets for federal and state income taxes are as follows (in thousands): December 31, 2022 2021 Deferred tax assets: Net operating loss carryforwards $ 545,508 $ 564,712 Research and other credits 142,198 139,996 Net capital loss carryforwards 38,445 — Operating lease liabilities 28,254 34,680 Stock-based compensation 22,110 33,408 Capitalized research and development costs 24,134 — Liability related to the sale of future royalties 13,424 23,757 Other 13,935 17,290 Deferred tax assets before valuation allowance 828,008 813,843 Valuation allowance for deferred tax assets (816,235) (785,748) Total deferred tax assets 11,773 28,095 Deferred tax liabilities: Operating lease right-of-use assets (11,335) (27,204) Investment in foreign subsidiary (2,451) — Other (392) (564) Total deferred tax liabilities (14,178) (27,768) Net deferred tax assets (liabilities) $ (2,405) $ 327 Realization of our deferred tax assets is dependent upon future earnings, if any, the timing and amount of which are uncertain. Because of our lack of U.S. earnings history, other than income resulting from revenue recognized from the BMS Collaboration Agreement, and projected future losses, we have fully reserved our net U.S. deferred tax assets with a valuation allowance. The valuation allowance increased by $30.5 million and $115.6 million during the years ended December 31, 2022 and 2021, respectively. Our net deferred tax liability position reflects the provision for the withholding taxes associated with the repatriation of accumulated earnings and profits from India. Net Operating Loss and Tax Credit Carryforwards As of December 31, 2022, we had a net operating loss carryforward for federal income tax purposes of approximately $2.4 billion, of which $1.3 billion is subject to expiration beginning in 2023 and a total state net operating loss carryforward of approximately $0.7 billion, portions of which will begin to expire in 2027. We have federal tax credits of approximately $123.8 million, which will begin to expire in 2023 and state research credits of approximately $48.8 million which have no expiration date. Utilization of some of the federal and state net operating loss and credit carryforwards are subject to annual limitations due to the “change in ownership” provisions of the Internal Revenue Code of 1986 and similar state provisions. Unrecognized tax benefits We have the following activity relating to unrecognized tax benefits (in thousands): Year Ended December 31, 2022 2021 2020 Beginning balance $ 80,604 $ 78,665 $ 77,410 Tax positions related to current year: Additions 378 2,371 2,512 Reductions — — — Tax positions related to prior years: Additions 5,272 58 193 Reductions — (490) (1,450) Settlements — — — Lapses in statute of limitations (409) — — Ending balance $ 85,845 $ 80,604 $ 78,665 If we are eventually able to recognize our uncertain tax positions, our effective tax rate may be reduced. We currently have a full valuation allowance against our U.S. net deferred tax asset which would impact the timing of the effective tax rate benefit should any of these uncertain tax positions be favorably settled in the future. Adjustments to the substantial majority of our uncertain tax positions would result in an adjustment of our net operating loss or tax credit carryforwards rather than resulting in a cash outlay. We file income tax returns in the U.S., California, Alabama, certain other states and India. As a result of our net operating loss and research credit carryforwards, substantially all of our domestic tax years remain open and subject to examination. We may be subject to examination in India from time to time, but we do not believe that any liability resulting from such an examination would have a material effect on our financial position or results of operations. |
Segment Reporting
Segment Reporting | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
Segment Reporting | Segment Reporting We operate in one business segment which focuses on applying our technology platforms to develop novel drug candidates. Our business offerings have similar economics and other characteristics, including the nature of products and manufacturing processes, types of customers, distribution methods and regulatory environment. We are comprehensively managed as one business segment by our Chief Executive Officer. Our revenue is derived primarily from customers in the pharmaceutical and biotechnology industries. Revenue from UCB Pharma, Baxalta / Takeda, AstraZeneca and Pfizer represented 37%, 25%, 14% and 11% of our revenue, respectively, for the year ended December 31, 2022. Revenue from UCB Pharma, Baxalta / Takeda, AstraZeneca and Pfizer represented 36%, 23%, 16% and 13% of our revenue, respectively, for the year ended December 31, 2021. Revenue from BMS, UCB Pharma, Baxalta / Takeda, and AstraZeneca represented 33%, 23%, 14% and 13% of our revenue for the year-ended December 31, 2020. Revenue by geographic area is based on the headquarters or shipping locations of our partners. The following table sets forth revenue by geographic area (in thousands): Year Ended December 31, 2022 2021 2020 United States $ 9,841 $ 10,114 $ 64,966 Rest of World 82,214 91,793 87,949 Total revenue $ 92,055 $ 101,907 $ 152,915 |
Organization and Summary of S_2
Organization and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization | Organization We are a research-based biopharmaceutical company headquartered in San Francisco, California and incorporated in Delaware. We are developing a pipeline of drug candidates that utilize our advanced polymer conjugate technology platforms, which are designed to enable the development of new molecular entities that target known mechanisms of action. Our research and development pipeline of new investigational drugs includes innovative medicines in the field of immunotherapy. |
Basis of Presentation, Principles of Consolidation and Use of Estimates | Basis of Presentation, Principles of Consolidation and Use of Estimates Our Consolidated Financial Statements include the financial position, results of operations and cash flows of our wholly-owned subsidiaries. We have eliminated all intercompany accounts and transactions in consolidation. Our Consolidated Financial Statements are denominated in U.S. dollars. Accordingly, changes in exchange rates between the applicable foreign currency and the U.S. dollar will affect the translation of each foreign subsidiary’s financial results into U.S. dollars for purposes of reporting our consolidated financial results. We include translation gains and losses in accumulated other comprehensive loss in the stockholders’ equity section of our Consolidated Balance Sheets. To date, such cumulative currency translation adjustments have not been significant to our consolidated financial position. Our comprehensive loss consists of our net loss plus our foreign currency translation gains and losses and unrealized holding gains and losses on available-for-sale securities. There were no significant reclassifications out of accumulated other comprehensive loss to the statements of operations during the years ended December 31, 2022, 2021 and 2020. The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Accounting estimates and assumptions are inherently uncertain. Actual results could differ materially from those estimates and assumptions. Our estimates include those related to the selling prices of performance obligations and amounts of variable consideration in collaboration agreements, royalty revenue, and other assumptions required for revenue recognition as described further below; the net realizable value of inventory; the fair value and impairment of investments, goodwill and long-lived assets; contingencies, accrued clinical trial, contract manufacturing and other expenses; income taxes; non-cash royalty revenue and non-cash interest expense from our liabilities related to our sales of future royalties; assumptions used in the valuation of our development derivative liability as further described in Note 6; our assumptions used in stock-based compensation; and ongoing litigation, among other estimates. We base our estimates on historical experience and on other assumptions that management believes are reasonable under the circumstances. These estimates form the basis for making judgments about the carrying values of assets and liabilities when these values are not readily apparent from other sources. As appropriate, we assess estimates each period, update them to reflect current information, and will generally reflect any changes in estimates in the period first identified. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The recorded amounts of certain financial instruments, including cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate their fair values due to their relatively short maturities. We record available-for-sale investments and cash equivalents at their estimated fair values, which are based on market prices from a variety of industry standard data providers and generally represent quoted prices for similar assets in active markets or have been derived from observable market data. As further described in Note 11, we estimated the fair value of our lease assets for recognizing impairment charges based on management’s estimates of several unobservable inputs, including estimated time to enter a sublease, sublease rental rates and free rent periods. As further described in Note 6, we recorded the development derivative liability at its estimated fair value based on management’s estimates of several unobservable inputs, including the probabilities of success of clinical trials and various other inputs. The fair value of our financial assets and liabilities are determined in accordance with the fair value hierarchy established in ASC 820-10, Fair Value Measurements and Disclosures (ASC 820). ASC 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The fair value hierarchy of ASC Topic 820 requires an entity to maximize the use of observable inputs when measuring fair value and classifies those inputs into three levels: Level 1 — Quoted prices in active markets for identical assets or liabilities. Level 2 — Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices for identical or similar assets or liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. For the years ended December 31, 2022 and 2021, there were no transfers between Level 1 and Level 2 of the fair value hierarchy. Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. |
Cash, Cash Equivalents, and Investments in Marketable Securities | Cash, Cash Equivalents, and Investments in Marketable Securities We consider all investments in marketable securities with an original maturity of three months or less when purchased to be cash equivalents. We classify investments in securities with remaining maturities of less than one year, or where our intent is to use the investments to fund current operations or to make them available for current operations, as short-term investments. We classify investments in securities with remaining maturities of over one year as long-term investments. Our cash and investments are held or issued by financial institutions that management believes are of high credit quality. However, they are exposed to credit risk in the event of default by the third parties that hold or issue such assets. Our investment policy limits investments to fixed income securities denominated and payable in U.S. dollars such as corporate bonds, corporate commercial paper, U.S. government obligations, and money market funds and places restrictions on maturities and concentrations by type and issuer. For our available-for-sale securities, we have significant concentrations of issuers in the banking and financial services industry. While our investment policy requires that we only invest in highly-rated securities and limit our exposure to any single issuer, a variety of factors may materially affect the financial condition of issuers. Additionally, pursuant to our investment policy, we may sell securities before maturity if the issuer’s credit rating has been downgraded below our minimum credit rating requirements, which may result in a loss on the sale. Accordingly, if factors result in downgrades below our minimum credit rating requirements and if we decide to sell these securities, we may experience losses on such sales. Investments are designated as available-for-sale and are carried at fair value with unrealized gains and losses reported in stockholders’ equity as accumulated other comprehensive income (loss). We review our portfolio of available-for-sale debt securities, using both quantitative and qualitative factors, to determine if declines in fair value below amortized cost have resulted from a credit-related loss or other factors. If the decline in fair value is due to credit-related factors, we recognize a loss in our Consolidated Statement of Operations, whereas if the decline in fair value is not due to credit-related factors, we recognize the loss in other comprehensive income (loss). We include coupon interest on securities classified as available-for-sale, as well as amortization of premiums and accretion of discounts to maturity, in interest income. The cost of securities sold is based on the specific identification method. |
Accounts Receivable and Significant Customer Concentrations | Accounts Receivable and Significant Customer Concentrations Our customers are primarily pharmaceutical and biotechnology companies that are primarily located in the U.S. and Europe and with whom we have multi-year arrangements. Our accounts receivable balance contains billed and unbilled trade receivables from product sales, milestones (to the extent that they have been achieved and are due from the counterparty), other contingent payments, as well as reimbursable costs from collaborative research and development agreements.We perform a regular review of our partners’ credit risk and payment histories when circumstances warrant, including payments made subsequent to year-end. When appropriate, we provide for an allowance for doubtful accounts by reserving for specifically identified doubtful accounts, although historically we have not experienced credit losses from our accounts receivable. |
Inventory and Significant Supplier Concentrations | Inventory and Significant Supplier Concentrations We generally manufacture inventory upon receipt of firm purchase orders from our collaboration partners, and we may manufacture certain intermediate work-in-process materials and purchase raw materials based on purchase forecasts from our collaboration partners. Inventory includes direct materials, direct labor, and manufacturing overhead, and we determine cost on a first-in, first-out basis for raw materials and on a specific identification basis for work-in-process and finished goods. We value inventory at the lower of cost or net realizable value, and we write down defective or excess inventory to net realizable value based on historical experience or projected usage. We expense inventory related to our research and development activities when we purchase or manufacture it. We are dependent on our suppliers and contract manufacturers to provide raw materials and drugs of appropriate quality and reliability and to meet applicable contract and regulatory requirements. In certain cases, we rely on single sources of supply of one or more critical materials. Consequently, in the event that supplies are delayed or interrupted for any reason, our ability to develop and produce our drug candidates, our ability to supply comparator drugs for our clinical trials, or our ability to meet our supply obligations could be significantly impaired, which could have a material adverse effect on our business, financial condition and results of operations. |
Restructuring | Restructuring We recognize restructuring charges related to reorganization plans that have been committed to by management when liabilities have been incurred. In connection with these activities, we record restructuring charges at fair value for: • contractual employee termination benefits provided that the obligations result from services already rendered based on vested rights to such benefits when the payment of benefits becomes probable and the amount can be reasonably estimated; • one-time employee termination benefits on the communication date from management to the employees provided that management has committed to a plan of termination, the plan identifies the employees and their expected termination dates, the details of termination benefits are complete, and it is unlikely that changes to the plan will be made or the plan will be withdrawn; • contract termination costs when we cancel the contract in accordance with its terms; and • costs to be incurred over the remaining contract term without economic benefit to us at the cease-use date. For one-time employee terminations benefits, we recognize the liability in full on the communication date when future services are not required or amortize the liability ratably over the service period, if required. The fair value of termination benefits reflects our estimates of expected utilization of certain Company-funded post-employment benefits. |
Long-Lived Assets | Long-Lived Assets We report property, plant and equipment at cost, net of accumulated depreciation. We capitalize major improvements and expense maintenance and repairs as incurred. We generally recognize depreciation on a straight-line basis. We depreciate manufacturing, laboratory and other equipment over their estimated useful lives of generally three Goodwill represents the excess of the price paid for another entity over the fair value of the assets acquired and liabilities assumed in a business combination. We are organized in one reporting unit and evaluate the goodwill for the Company as a whole. Goodwill has an indefinite useful life and is not amortized, but instead tested for impairment at least annually in the fourth quarter of each year using an October 1 measurement date. We assess the impairment of long-lived assets whenever events or changes in business circumstances indicate that the carrying amounts of the assets may not be fully recoverable. In the case of property, plant and equipment and right-of-use assets for our leases, we determine whether there has been an impairment by comparing the carrying value of the asset to the anticipated undiscounted net cash flows associated with the asset. If such cash flows are less than the carrying value, we write down the asset to its fair value, which may be measured as anticipated discounted net cash flows associated with the asset. In the case of goodwill impairment, we compare the carrying value of the reporting unit to its fair value, which we generally measure using market capitalization for our single reporting unit. If an impairment exists, we write down goodwill such that the carrying value of the reporting unit equals its fair value. |
Leases | Leases We determine if an arrangement contains a lease at the inception of the arrangement. Right-of-use assets represent our right to use an underlying asset for the lease term, and lease liabilities represent our obligation to make lease payments arising from the lease. We recognize operating lease right-of-use assets and liabilities at the lease commencement date based on the present value of lease payments over the expected lease term. In determining the present value of lease payments, we use our incremental borrowing rate based on the information available at the lease commencement date. We have elected the practical expedient to account for the lease and non-lease components, such as common area maintenance charges, as a single lease component for our facilities leases, and elected the short-term lease recognition exemption for our short-term leases, under which we do not recognize lease liabilities and right-of-use assets for leases with an original term of twelve months or less. Our expected lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise any such options. We recognize lease expense for our operating leases on a straight-line basis over the expected lease term. We have elected to recognize lease incentives, such as tenant improvement allowances, at the lease commencement date as a reduction of the right-of-use asset and lease liability until paid to us by the lessor to the extent that the lease provides a specified fixed or maximum level of reimbursement and we are reasonably certain to incur reimbursable costs at least equaling such amounts. Please see Note 5 for additional information regarding our leases. |
Collaborative Arrangements | Collaborative Arrangements We enter into collaboration arrangements with pharmaceutical and biotechnology collaboration partners, under which we may grant licenses to our collaboration partners to further develop and commercialize one of our drug candidates, either alone or in combination with the collaboration partners’ compounds, or grant licenses to partners to use our technology to research and develop their own drug candidates. We may also perform research, development, manufacturing and supply activities under our collaboration agreements. Consideration under these contracts may include an upfront payment, development and regulatory milestones and other contingent payments, expense reimbursements, royalties based on net sales of approved drugs, and commercial sales milestone payments. Additionally, these contracts may provide options for the customer to purchase our proprietary PEGylation materials, drug candidates or additional contract research and development services under separate contracts. When we enter into collaboration agreements, we assess whether the arrangements fall within the scope of ASC 808, Collaborative Arrangements (ASC 808) based on whether the arrangements involve joint operating activities and whether both parties have active participation in the arrangement and are exposed to significant risks and rewards of the arrangement. To the extent that the arrangement falls within the scope of ASC 808, we assess whether the payments between us and our collaboration partner fall within the scope of other accounting literature. If we conclude that payments from the collaboration partner to us represent consideration from a customer, such as license fees and contract research and development activities, we account for those payments within the scope of ASC 606, Revenue from Contracts with Customers (ASC 606). However, if we conclude that our collaboration partner is not a customer for certain activities and associated payments, such as for certain collaborative research, development, manufacturing and commercial activities, we present such payments as a reduction of research and development expense or general and administrative expense, based on where we present the underlying expense. |
Revenue Recognition | Revenue Recognition For elements of those arrangements that we determine should be accounted for under ASC 606, we assess which activities in our collaboration agreements are performance obligations that should be accounted for separately and determine the transaction price of the arrangement, which includes the assessment of the probability of achievement of future milestones and other potential consideration. For arrangements that include multiple performance obligations, such as granting a license or performing contract research and development activities or participation on joint steering or other committees, we allocate upfront and milestone payments under a relative standalone selling price method. Accordingly, we develop assumptions that require judgment to determine the standalone selling price for each performance obligation identified in the contract. These key assumptions may include revenue forecasts, clinical development timelines and costs, discount rates and probabilities of clinical and regulatory success. Product sales Product sales are primarily derived from manufacturing and supply agreements with our customers. We have assessed our current manufacturing and supply arrangements and have generally determined that they provide the customer an option to purchase our proprietary PEGylation materials. Accordingly, we treat each purchase order as a discrete exercise of the customer’s option (i.e. a separate contract) rather than as a component of the overall arrangement. The pricing for the manufacturing and supply is generally at a fixed price and may be subject to annual producer price index (PPI) adjustments. We invoice and recognize product sales when title and risk of loss pass to the customer, which generally occurs upon shipment. Customer payments are generally due 30 days from receipt of an invoice. We test our products for adherence to technical specifications before shipment; accordingly, we have not experienced any significant returns from our customers. We recognize costs related to shipping and handling of product to customers in cost of goods sold. Royalty revenue, including Non-cash royalty revenue Generally, for our collaboration arrangements that include sales-based royalties, we have granted our collaboration partner a license to our intellectual property. Pursuant to these arrangements, our collaboration partners are typically obligated to pay a royalty that is based on the net sales of their approved drugs that are sold in the countries where we have intellectual property rights covering their drugs. We have sold our rights to receive sales-based royalties for CIMZIA ® , MIRCERA ® , MOVANTIK ® , ADYNOVATE ® and REBINYN ® as further described in Note 7. For collaboration arrangements that include sales-based royalties, we have concluded that the license is the predominant item to which the royalties relate, which include commercial milestone payments based on the level of sales. Accordingly, we recognize royalty revenue when the underlying sales occur based on our best estimates of sales of the drugs. Our aggregate royalty and non-cash royalty revenue of $69.8 million, $77.7 million and $79.6 million for the years ended December 31, 2022, 2021 and 2020, respectively, represents revenue for granting licenses for which we had satisfied in prior periods. Our partners generally pay royalties or commercial milestones after the end of the calendar quarter in accordance with contractual terms. We present commercial milestone payments within license, collaboration and other revenue. License, collaboration and other revenue License Grants : For collaboration arrangements that include a grant of a license to our intellectual property, we consider whether the license grant is distinct from the other performance obligations included in the arrangement. Generally, we would conclude that the license is distinct if the customer is able to benefit from the license with the resources available to it. For licenses that are distinct, we recognize revenues from nonrefundable, upfront payments and other consideration allocated to the license when the license term has begun and we have provided all necessary information regarding the underlying intellectual property to the customer, which generally occurs at or near the inception of the arrangement. Milestone Payments : At the inception of the arrangement and at each reporting date thereafter, we assess whether we should include any milestone payments or other forms of variable consideration in the transaction price, based on whether a significant reversal of revenue previously recognized is not probable upon resolution of the uncertainty. Since milestone payments may become payable to us upon the initiation of a clinical study, filing for or receipt of regulatory approval or the first commercial sale of a product, we review the relevant facts and circumstances to determine when we should update the transaction price, which may occur before the triggering event. When we do update the transaction price for milestone payments, we allocate it on a relative standalone selling price basis and record revenue on a cumulative catch-up basis, which results in recognizing revenue for previously satisfied performance obligations in such period. As described further in Note 10, we recognized $50.0 million of milestones in the year ended December 31, 2020 because we had previously satisfied the performance obligation. If we update the transaction price before the triggering event, we recognize the increase in the transaction price as a contract asset. Our partners generally pay development milestones subsequent to achievement of the triggering event. Research and Development Services : For amounts allocated to our research and development obligations in a collaboration arrangement, we recognize revenue over time using a proportional performance model, representing the transfer of goods or services as we perform activities over the term of the agreement. |
Research and Development Expense | Research and Development Expense Research and development costs are expensed as incurred and include salaries, benefits and other operating costs such as outside services, supplies and allocated overhead costs. We perform research and development activities for our drug candidates and technology development and for certain third parties under collaboration agreements. For our drug candidates and our internal technology development programs, we invest our own funds without reimbursement from a third party. Where we perform research and development activities under a joint development collaboration, such as our collaboration with BMS, we record the cost reimbursement from our partner as a reduction to research and development expense when reimbursement amounts are due to us under the agreement. We record an accrued expense for the estimated unbilled costs of our clinical study activities performed by third parties. The financial terms of these agreements are subject to negotiation, vary from contract to contract and may result in uneven payment flows to our vendors. Payments under the contracts depend on factors such as the achievement of certain events, successful enrollment of patients and completion of certain clinical trial activities. We generally recognize costs associated with the start-up and reporting phases of the clinical trials as incurred. We generally accrue costs associated with the treatment phase of clinical trials based on the estimated activities performed by our third party vendors, including our contract research organizations. We may also accrue expenses based on the total estimated cost of the treatment phase on a per patient basis and expense the per patient cost ratably over the estimated patient treatment period. In specific circumstances, such as for certain time-based costs, we recognize clinical trial expenses ratably over the service period, as we believe that this methodology may be more reflective of the timing of costs incurred. We record an accrued expense for the estimated costs of our contract manufacturing activities performed by third parties. The financial terms of these agreements are subject to negotiation, vary from contract to contract and may result in uneven payment flows to our vendors. Payments under the contracts include upfront payments and milestone payments, which depend on factors such as the achievement of the completion of certain stages of the manufacturing process. For purposes of recognizing expense, we assess whether we consider the production process to be sufficiently defined such that the resulting product can be considered the delivery of a good, as evidenced by predictive or contractually required yields in the production process or payment terms based on the actual yield, or the delivery of a service, where processes and yields are developing and less certain. If we consider the process to be the delivery of a good, we recognize expense when the drug product is delivered, or we otherwise bear risk of loss. If we consider the process to be the delivery of a service, we recognize expense based on our best estimates of the contract manufacturer’s progress towards completion of the stages in the contracts. We recognize and amortize upfront payments and accrue liabilities based on the specific terms of each arrangement. Certain arrangements may provide upfront payments for certain stages of the arrangement and milestone payments for the completion of certain stages, and, accordingly, we may record advance payments for services that have not been completed or goods not delivered and liabilities for stages where the contract manufacturer is entitled to a milestone payment. We capitalize advance payments for goods or services that will be used or rendered for future research and development activities and recognize expense as the related goods are delivered or services performed. We base our estimates on the best information available at the time. However, additional information may become available to us in the future which may allow us to make a more accurate estimate in future periods. In this event, we may be required to record adjustments to research and development expenses in future periods when the actual level of activity becomes more certain. We generally consider such increases or decreases in cost as changes in estimates and reflect them in research and development expenses in the period identified. |
Restructuring, Impairment and Other Costs for Terminated Program | Restructuring, Impairment and Other Costs for Terminated Program Amounts recorded as restructuring, impairment and other costs for terminated program for the year ended December 31, 2022 relate to the termination of the bempegaldesleukin program and the 2022 Restructuring Plan. See Note 11 for additional information. |
Stock-Based Compensation | Stock-Based Compensation Stock-based compensation arrangements include grants of stock options, restricted stock units (RSUs), performance stock units (PSUs) under our equity incentive plans, as well as shares issued under our Employee Stock Purchase Plan (ESPP), through which employees may purchase our common stock at a discount to the market price. We expense the grant date fair value of options, RSUs, PSUs and ESPP shares on a straight-line basis over the requisite service periods in our Consolidated Statements of Operations and recognize forfeitures of options, RSUs and PSUs as they occur. For options and RSUs that vest upon the achievement of performance milestones, we recognize expense provided that we believe that the performance milestones are probable of achievement, and we estimate the vesting period based on our evaluation of the estimated date of achievement of these milestones. For PSUs, we recognize expense based on the grant date fair value regardless of whether the market condition is met. Additionally, we do not adjust the expense based on the number of shares ultimately issued, which may be higher or lower than the grant amount. We report expense amounts in cost of goods sold, research and development expense, and general and administrative expense based on the function of the applicable employee. Stock-based compensation charges are non-cash charges and have no effect on our reported cash flows. We estimate the grant date fair value of our stock-based compensation awards as follows: • We use the Black-Scholes option pricing model for the respective grant to determine the estimated fair value of the option on the date of grant (grant date fair value) and the estimated fair value of common stock purchased under the ESPP. The Black-Scholes option pricing model requires the input of highly subjective assumptions, including but not limited to, our stock price volatility over the term of the awards, and actual and projected employee stock option exercise behaviors. • The number of shares issuable under PSUs is based on our total shareholder return as compared to other companies within the Nasdaq biotechnology index over the measurement period and may be capped based on our absolute total shareholder return over such period. We use the Monte Carlo simulation model to determine the estimated grant date fair value. The Monte Carlo simulation model incorporates assumptions such as the volatility of our stock, the |
Income Taxes | Income Taxes We account for income taxes under the liability method. Under this method, we determine deferred tax assets and liabilities based on differences between the financial reporting and tax reporting bases of assets and liabilities, measured using enacted tax rates and laws that we expect to be in effect when we expect the differences to reverse. Realization of deferred tax assets is dependent upon future earnings, the timing and amount of which are uncertain. We record a valuation allowance against deferred tax assets to reduce their carrying value to an amount that is more likely than not to be realized. When we establish or reduce the valuation allowance related to the deferred tax assets, our provision for income taxes will increase or decrease, respectively, in the period we make such determination. We utilize a two-step approach to recognize and measure uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained upon tax authority examination, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount of benefit, determined on a cumulative probability basis, that is more than 50% likely of being realized upon ultimate settlement. For the years ended December 31, 2022, 2021 and 2020, our income tax provision primarily relates to our Nektar India subsidiary. As a result of the 2022 Restructuring Plan and our intent to wind down our foreign subsidiaries, we have recorded a provision for the repatriation of accumulated earnings and profits from India. See Note 13 for additional information. |
Net Loss Per Share | Net Loss Per Share For all periods presented in the Consolidated Statements of Operations, the net loss available to common stockholders is equal to the reported net loss. We calculate basic net loss per share based on the weighted-average number of common shares outstanding during the periods presented. |
Comprehensive Loss | Comprehensive Loss Comprehensive loss is the change in stockholders’ equity from transactions and other events and circumstances other than those resulting from investments by stockholders and distributions to stockholders. Our comprehensive loss includes our net loss, gains and losses from the foreign currency translation of the assets and liabilities of our foreign subsidiaries, and unrealized gains and losses on investments in available-for-sale securities. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements We have reviewed recent accounting pronouncements and concluded they are either not applicable to us or that we do not expect adoption to have a material effect on our consolidated financial statements. |
Cash and Investments in Marke_2
Cash and Investments in Marketable Securities (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Cash and Cash Equivalents [Abstract] | |
Schedule of Cash and Investments in Marketable Securities, Including Cash Equivalents | Cash and investments in marketable securities, including cash equivalents, are as follows (in thousands): Estimated Fair Value at December 31, December 31, Cash and cash equivalents $ 88,227 $ 25,218 Short-term investments 416,750 708,737 Long-term investments — 64,828 Total cash and investments in marketable securities $ 504,977 $ 798,783 |
Schedule of Portfolio of Cash and Investments in Marketable Securities | Our portfolio of cash and investments in marketable securities includes (in thousands): Fair Value December 31, 2022 December 31, 2021 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Fair Value Corporate notes and bonds 2 $ 84,377 $ — $ (855) $ 83,522 $ 278,121 Corporate commercial paper 2 345,125 25 (946) 344,204 478,629 Obligations of U.S. government agencies 2 — — — — 5,875 Available-for-sale investments 429,502 25 (1,801) 427,726 762,625 Money market funds 1 47,054 23,968 Certificates of deposit 2 21,399 10,940 Cash N/A 8,798 1,250 Total cash and investments in marketable securities $ 504,977 $ 798,783 |
Inventory (Tables)
Inventory (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventory consists of the following (in thousands): December 31, 2022 2021 Raw materials $ 2,575 $ 3,166 Work-in-process 10,749 9,342 Finished goods 5,878 3,293 Total inventory $ 19,202 $ 15,801 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant and Equipment | Property, plant and equipment consists of the following (in thousands): December 31, 2022 2021 Building and leasehold improvements $ 74,889 $ 97,385 Laboratory equipment 24,243 42,704 Computer equipment and software 26,205 28,829 Manufacturing equipment 25,052 22,374 Furniture, fixtures, and other 4,263 10,094 Depreciable property, plant and equipment at cost 154,652 201,386 Less: accumulated depreciation (124,731) (148,039) Depreciable property, plant and equipment, net 29,921 53,347 Construction-in-progress 2,530 7,163 Property, plant and equipment, net $ 32,451 $ 60,510 Year Ended December 31, 2022 Proceeds from sales $ 13,196 Net book value of assets 9,870 Total (gain) loss on sale or disposal of property, plan and equipment, net (3,326) |
Operating Leases (Tables)
Operating Leases (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Schedule of Operating Lease Information | The following table presents key information regarding these leases (dollars in thousands): Mission Bay Facility Third Street Facility Lease commencement September 2017 June 2018 Lease term January 2030 January 2030 Renewal terms Two consecutive five One five |
Schedule of Lease Expense | The components of lease expense, which we include in operating expenses in our Consolidated Statements of Operations, were as follows (in thousands): Year Ended December 31, 2022 2021 2020 Operating lease expense $ 17,057 $ 19,153 $ 18,985 Variable lease expense 10,700 8,974 8,179 Total lease expense $ 27,757 $ 28,127 $ 27,164 |
Schedule of Future Minimum Lease Payments for Operating Leases | As of December 31, 2022, the maturities of our operating lease liabilities were as follows (in thousands): Year ending December 31, 2023 $ 19,216 2024 21,572 2025 22,254 2026 22,958 2027 23,681 2028 and thereafter 51,732 Total lease payments 161,413 Less: portion representing interest (29,917) Operating lease liabilities 131,496 Less: current portion (18,667) Operating lease liabilities, less current portion $ 112,829 |
Co-Development Agreement with_2
Co-Development Agreement with SFJ Pharmaceuticals and Development Derivative Liability (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Liabilities at Fair Value | The following table presents the changes in the development derivative liability: Year Ended December 31, Fair Value Hierarchy Level 2022 2021 Fair value as of December 31, 2021 and February 12, 2021 (inception), respectively 3 $ 27,726 $ — Non-cash research and development expense 4,951 16,703 Cash receipts from SFJ 750 3,000 Change in the fair value of development derivative liability (33,427) 8,023 Fair value at end of period 3 $ — $ 27,726 |
Liabilities Related to the Sa_2
Liabilities Related to the Sales of Future Royalties (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Liability Related To Sale Of Potential Future Royalties [Abstract] | |
Schedule of Liability Related to Potential Future Royalties | The following table shows the activity within the liability account of each arrangement (in thousands): Year-Ended December 31, 2022 Period from inception to December 31, 2022 2012 Purchase and Sale Agreement 2020 Purchase and Sale Agreement Total 2012 Purchase and Sale Agreement 2020 Purchase and Sale Agreement Total Liabilities related to the sales of future royalties—beginning $ 78,282 $ 120,062 $ 198,344 $ — $ — $ — Royalty monetization proceeds — — — 124,000 150,000 274,000 Non-cash royalty revenue (33,865) (35,929) (69,794) (316,523) (86,722) (403,245) Non-cash interest expense 10,750 18,161 28,911 234,168 39,016 273,184 Payments to RPI — — — (10,000) — (10,000) Loss on revaluation of liability related to the sale of future royalties — — 23,522 — 23,522 Liabilities related to the sales of future royalties – ending balance 55,167 102,294 157,461 55,167 102,294 157,461 Less: unamortized transaction costs — (2,083) (2,083) — (2,083) (2,083) Liabilities related to the sales of future royalties, net $ 55,167 $ 100,211 $ 155,378 $ 55,167 $ 100,211 $ 155,378 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
Schedule of Shares of Common Stock Reserved for Future Issuance | As of December 31, 2022, shares of common stock reserved for future issuance are as follows (in thousands): Stock options, RSUs and PSUs outstanding 23,589 Shares available for future grant under the 2017 Performance Incentive Plan 2,973 Shares available for issuance under the employee stock purchase plan 841 Total common stock reserved for issuance 27,403 Year Ended December 31, 2022 2021 2020 Average risk-free interest rate 2.9 % 1.2 % 0.4 % Dividend yield 0.0 % 0.0 % 0.0 % Average volatility factor 77.9 % 63.8 % 64.1 % Weighted-average expected life 5.6 years 5.5 years 5.6 years Weighted-average grant-date fair value of options granted $ 3.18 $ 8.07 $ 10.70 |
License and Collaboration Agr_2
License and Collaboration Agreements (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of License, Collaboration and Other Revenue | In accordance with our collaboration agreements, we recognized license, collaboration and other revenue as follows (in thousands): Year Ended December 31, Partner Agreement 2022 2021 2020 Bristol-Myers Squibb Bempegaldesleukin $ — $ — $ 50,000 Other 1,913 436 5,849 License, collaboration and other revenue $ 1,913 $ 436 $ 55,849 |
Restructuring, Impairment and_2
Restructuring, Impairment and Other Costs of Terminated Program (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring, Impairment and Other Costs of Terminated Program | Restructuring, impairment and other costs of terminated program includes the following (in thousands): Year Ended December 31, 2022 Clinical trial expense, other third-party and employee costs for the wind down of the bempegaldesleukin program $ 31,693 Severance and benefit expense 30,904 Impairment of right-of-use assets and property, plant and equipment 65,761 (Gain) loss on sale or disposal of property, plant and equipment, net (3,326) Contract termination and other restructuring costs 10,898 Restructuring, impairment and other costs of terminated program $ 135,930 Year Ended December 31, 2022 No service period Service period required Total Liability balance as of March 31, 2022 $ — $ — $ — Expense recognized during the period 22,993 7,911 30,904 Payments during the period (22,993) (4,612) (27,605) Liability balance as of December 31, 2022 $ — $ 3,299 $ 3,299 We recorded impairment charges as follows (in thousands): Year Ended December 31, 2022 Operating Lease Right-of-Use Assets Property, Plant and Equipment Total Net book value of impaired sublease assets as of May 31, 2022 $ 72,481 $ 16,348 $ 88,829 Less: Fair value of impaired sublease assets — Level 3 of Fair Value Hierarchy (16,174) (4,780) (20,954) Book value in excess of fair value 56,307 11,568 67,875 Less: Amounts recorded as amortization between May 31 and December 31, 2022 for Third St. facility (1,717) (397) (2,114) Total impairment of sublease assets $ 54,590 $ 11,171 $ 65,761 |
Schedule of Property, Plant and Equipment | Property, plant and equipment consists of the following (in thousands): December 31, 2022 2021 Building and leasehold improvements $ 74,889 $ 97,385 Laboratory equipment 24,243 42,704 Computer equipment and software 26,205 28,829 Manufacturing equipment 25,052 22,374 Furniture, fixtures, and other 4,263 10,094 Depreciable property, plant and equipment at cost 154,652 201,386 Less: accumulated depreciation (124,731) (148,039) Depreciable property, plant and equipment, net 29,921 53,347 Construction-in-progress 2,530 7,163 Property, plant and equipment, net $ 32,451 $ 60,510 Year Ended December 31, 2022 Proceeds from sales $ 13,196 Net book value of assets 9,870 Total (gain) loss on sale or disposal of property, plan and equipment, net (3,326) |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Stock-Based Compensation Expense | We recognize total stock-based compensation expense in our Consolidated Statements of Operations as follows (in thousands): Year Ended December 31, 2022 2021 2020 Cost of goods sold $ 2,824 $ 2,779 $ 2,825 Research and development 27,727 54,821 57,116 General and administrative 24,488 37,074 33,295 Restructuring, impairment and other costs of terminated program 2,281 — 1,025 Total stock-based compensation $ 57,320 $ 94,674 $ 94,261 |
Schedule of Black-Scholes Option-Pricing Model Assumptions Used to Calculate Fair Value of Employee Stock Options | As of December 31, 2022, shares of common stock reserved for future issuance are as follows (in thousands): Stock options, RSUs and PSUs outstanding 23,589 Shares available for future grant under the 2017 Performance Incentive Plan 2,973 Shares available for issuance under the employee stock purchase plan 841 Total common stock reserved for issuance 27,403 Year Ended December 31, 2022 2021 2020 Average risk-free interest rate 2.9 % 1.2 % 0.4 % Dividend yield 0.0 % 0.0 % 0.0 % Average volatility factor 77.9 % 63.8 % 64.1 % Weighted-average expected life 5.6 years 5.5 years 5.6 years Weighted-average grant-date fair value of options granted $ 3.18 $ 8.07 $ 10.70 |
Schedule of Stock Option Activity Under Equity Incentive Plans | The table below presents a summary of stock option activity under our equity incentive plans (in thousands, except for price per share and contractual life information): Number of Shares Weighted- Average Exercise Price per Share Weighted- Average Remaining Contractual Life (in Years) Aggregate Intrinsic Value(1) Outstanding at December 31, 2021 13,542 $ 23.62 Options granted 6,276 4.76 Options exercised (15) 12.43 Options forfeited & canceled (5,715) 20.73 Outstanding at December 31, 2022 14,088 $ 16.40 5.71 $ — Exercisable at December 31, 2022 6,029 27.82 3.60 $ — |
Schedule of Restricted Stock Unit Award Activity | A summary of RSU award activity is as follows (in thousands except for per share amounts): Units Issued Weighted- Unvested at December 31, 2021 9,930 $ 16.80 Granted 7,708 4.14 Vested and released (2,872) 17.64 Forfeited and canceled (5,454) 15.68 Unvested at December 31, 2022 9,312 $ 6.81 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income Before Income Tax, Domestic and Foreign | Loss before provision for income taxes includes the following components (in thousands): Year Ended December 31, 2022 2021 2020 Domestic $ (371,900) $ (524,440) $ (445,370) Foreign 6,917 1,160 1,423 Loss before provision for income taxes $ (364,983) $ (523,280) $ (443,947) |
Schedule of Provision for Income Taxes | The provision for income taxes consists of the following (in thousands): Year Ended December 31, 2022 2021 2020 Current: Federal $ — $ — $ — State (608) 50 165 Foreign 1,115 609 364 Total current income tax expense 507 659 529 Deferred: Federal — — — State — — — Foreign 2,708 (102) (36) Total deferred income tax expense 2,708 (102) (36) Provision for income taxes $ 3,215 $ 557 $ 493 |
Schedule of Income Tax Provision Related to Continuing Operations | Our income tax provision related to continuing operations differs from the amount computed by applying the statutory income tax rate of 21% to our pretax loss as follows (in thousands): Year Ended December 31, 2022 2021 2020 Income tax benefit at federal statutory rate $ (76,647) $ (109,889) $ (93,229) Research credits (987) (4,727) (3,081) Change in valuation allowance 51,108 97,914 87,060 Expiration of net operating loss carryforwards 12,348 286 286 Stock-based compensation 15,778 6,627 7,929 Non-cash interest expense on liability related to sales of future royalties 6,071 9,936 6,356 Non-cash royalty revenue related to sales of future royalties (7,112) (7,891) (7,967) Loss on revaluation of liability related to the sale of future royalties — 4,940 — Other 2,656 3,361 3,139 Provision for income taxes $ 3,215 $ 557 $ 493 |
Schedule of Significant Components of Deferred Tax Assets and Liabilities | We measure deferred tax assets and liabilities based on the rates at which they are expected to reverse in the future. Significant components of our deferred tax assets for federal and state income taxes are as follows (in thousands): December 31, 2022 2021 Deferred tax assets: Net operating loss carryforwards $ 545,508 $ 564,712 Research and other credits 142,198 139,996 Net capital loss carryforwards 38,445 — Operating lease liabilities 28,254 34,680 Stock-based compensation 22,110 33,408 Capitalized research and development costs 24,134 — Liability related to the sale of future royalties 13,424 23,757 Other 13,935 17,290 Deferred tax assets before valuation allowance 828,008 813,843 Valuation allowance for deferred tax assets (816,235) (785,748) Total deferred tax assets 11,773 28,095 Deferred tax liabilities: Operating lease right-of-use assets (11,335) (27,204) Investment in foreign subsidiary (2,451) — Other (392) (564) Total deferred tax liabilities (14,178) (27,768) Net deferred tax assets (liabilities) $ (2,405) $ 327 |
Schedule of Unrecognized Tax Benefits | We have the following activity relating to unrecognized tax benefits (in thousands): Year Ended December 31, 2022 2021 2020 Beginning balance $ 80,604 $ 78,665 $ 77,410 Tax positions related to current year: Additions 378 2,371 2,512 Reductions — — — Tax positions related to prior years: Additions 5,272 58 193 Reductions — (490) (1,450) Settlements — — — Lapses in statute of limitations (409) — — Ending balance $ 85,845 $ 80,604 $ 78,665 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
Schedule of Revenue by Geographic Area | The following table sets forth revenue by geographic area (in thousands): Year Ended December 31, 2022 2021 2020 United States $ 9,841 $ 10,114 $ 64,966 Rest of World 82,214 91,793 87,949 Total revenue $ 92,055 $ 101,907 $ 152,915 |
Organization and Summary of S_3
Organization and Summary of Significant Accounting Policies (Details) shares in Millions | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||||
Jan. 14, 2020 USD ($) | Jul. 23, 2017 | Apr. 30, 2022 | Sep. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) reporting_unit shares | Dec. 31, 2021 USD ($) shares | Dec. 31, 2020 USD ($) shares | Mar. 31, 2022 USD ($) | |
Organization And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Cash and investments in marketable securities | $ 504,977,000 | $ 798,783,000 | ||||||
Net expense reimbursements from collaboration partner | 21,400,000 | |||||||
Number of reporting unit evaluated for goodwill | reporting_unit | 1 | |||||||
Total revenue | $ 92,055,000 | 101,907,000 | $ 152,915,000 | |||||
Level 3 | Development Derivative Liability | ||||||||
Organization And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Liability Value | $ 0 | $ 27,726,000 | $ 0 | $ 0 | ||||
Employee Severance | ||||||||
Organization And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Percent of positions eliminated | 70% | |||||||
Expense recognized during the period | $ 30,904,000 | |||||||
Stock Options, RSUs and PSUs | ||||||||
Organization And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Weighted average antidilutive securities excluded from computation of earnings per share (in shares) | shares | 21.2 | 18.4 | 17.4 | |||||
BMS Collaboration Agreement | ||||||||
Organization And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Sales milestone revenue | $ 50,000,000 | |||||||
Nektar-358 | Nektar's | Eli Lilly And Company | ||||||||
Organization And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Percentage of regulatory milestones payments will be reduced if conditions occur | 75% | |||||||
Cash And NonCash Royalties | ||||||||
Organization And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Total revenue | $ 69,800,000 | $ 77,700,000 | $ 79,600,000 | |||||
NKTR - 181 | Program Termination | ||||||||
Organization And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Expense recognized during the period | $ 45,200,000 | |||||||
NKTR - 181 | Program Termination, Advance Paymnt To Contract Manyfacturers | ||||||||
Organization And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Expense recognized during the period | 19,700,000 | |||||||
NKTR - 181 | Program Termination, Noncancellable Commitments | ||||||||
Organization And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Expense recognized during the period | $ 25,500,000 | |||||||
Buildings | ||||||||
Organization And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Property and equipment estimated useful lives | 20 years | |||||||
Minimum | Manufacturing equipment | ||||||||
Organization And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Property and equipment estimated useful lives | 3 years | |||||||
Maximum | Nektar-358 | Nektar's | Eli Lilly And Company | ||||||||
Organization And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Percentage of funding phase 3 development costs on an indication by indication basis borne | 25% | |||||||
Maximum | Manufacturing equipment | ||||||||
Organization And Summary Of Significant Accounting Policies [Line Items] | ||||||||
Property and equipment estimated useful lives | 10 years |
Cash and Investments in Marke_3
Cash and Investments in Marketable Securities - Schedule of Cash and Investments in Marketable Securities, Including Cash Equivalents (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Estimated Fair Value at | ||
Cash and cash equivalents | $ 88,227 | $ 25,218 |
Short-term investments | 416,750 | 708,737 |
Long-term investments | 0 | 64,828 |
Total cash and investments in marketable securities | $ 504,977 | $ 798,783 |
Cash and Investments in Marke_4
Cash and Investments in Marketable Securities - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Cash and Investments in Marketable Securities [Line Items] | |||
Target maturity period | 2 years | ||
Weighted average maturity period | 1 year | ||
Sales of investments | $ 0 | $ 11,504 | $ 41,700 |
Accrued interest receivable | 700 | 1,400 | |
Gross unrealized gains | 25 | ||
Gross unrealized losses | 1,801 | 700 | |
Letter of credit | $ 7,500 | $ 8,100 | |
Minimum | |||
Cash and Investments in Marketable Securities [Line Items] | |||
Long term investment maturity period | 1 year | ||
Maximum | |||
Cash and Investments in Marketable Securities [Line Items] | |||
Long term investment maturity period | 2 years |
Cash and Investments in Marke_5
Cash and Investments in Marketable Securities - Schedule of Portfolio of Cash and Investments in Marketable Securities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized Cost | $ 429,502 | |
Gross Unrealized Gains | 25 | |
Gross Unrealized Losses | (1,801) | $ (700) |
Fair Value | 427,726 | 762,625 |
Cash | 8,798 | 1,250 |
Total cash and investments in marketable securities | 504,977 | 798,783 |
Corporate notes and bonds | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized Cost | 84,377 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | (855) | |
Fair Value | 83,522 | 278,121 |
Corporate commercial paper | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized Cost | 345,125 | |
Gross Unrealized Gains | 25 | |
Gross Unrealized Losses | (946) | |
Fair Value | 344,204 | 478,629 |
Obligations of U.S. government agencies | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized Cost | 0 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | 0 | |
Fair Value | 0 | 5,875 |
Money market funds | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments in marketable securities | 47,054 | 23,968 |
Certificates of deposit | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Investments in marketable securities | $ 21,399 | $ 10,940 |
Inventory - Schedule of Invento
Inventory - Schedule of Inventories (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 2,575 | $ 3,166 |
Work-in-process | 10,749 | 9,342 |
Finished goods | 5,878 | 3,293 |
Total inventory | $ 19,202 | $ 15,801 |
Property, Plant and Equipment -
Property, Plant and Equipment - Schedule of Property, Plant and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Property, Plant and Equipment [Line Items] | ||
Depreciable property, plant and equipment at cost | $ 154,652 | $ 201,386 |
Less: accumulated depreciation | (124,731) | (148,039) |
Depreciable property, plant and equipment, net | 29,921 | 53,347 |
Construction-in-progress | 2,530 | 7,163 |
Property, plant and equipment, net | 32,451 | 60,510 |
Building and leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Depreciable property, plant and equipment at cost | 74,889 | 97,385 |
Laboratory equipment | ||
Property, Plant and Equipment [Line Items] | ||
Depreciable property, plant and equipment at cost | 24,243 | 42,704 |
Computer equipment and software | ||
Property, Plant and Equipment [Line Items] | ||
Depreciable property, plant and equipment at cost | 26,205 | 28,829 |
Manufacturing equipment | ||
Property, Plant and Equipment [Line Items] | ||
Depreciable property, plant and equipment at cost | 25,052 | 22,374 |
Furniture, fixtures, and other | ||
Property, Plant and Equipment [Line Items] | ||
Depreciable property, plant and equipment at cost | $ 4,263 | $ 10,094 |
Property, Plant and Equipment_2
Property, Plant and Equipment - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation and amortization expenses | $ 12.2 | $ 13 | $ 12.5 |
Operating Leases - Additional I
Operating Leases - Additional Information (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 USD ($) ft² | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
Leases [Line Items] | |||
Impairment of right-of-use assets and property, plant and equipment | $ 65,761 | $ 0 | $ 0 |
Operating lease, payments | $ 20,100 | $ 16,800 | $ 16,200 |
Weighted average remaining lease term | 7 years 1 month 6 days | ||
Weighted average discount rate, percent | 5.80% | ||
Subleases aggregate lease payments | $ 10,500 | ||
Sublease Property, Plant And Equipment | |||
Leases [Line Items] | |||
Impairment of right-of-use assets and property, plant and equipment | $ 54,590 | ||
Mission Bay Facility | |||
Leases [Line Items] | |||
Lease space (in sq ft) | ft² | 155,215 | ||
Third Street Facility | |||
Leases [Line Items] | |||
Lease space (in sq ft) | ft² | 135,936 |
Operating Leases - Schedule of
Operating Leases - Schedule of Operating Lease Information (Details) | 12 Months Ended |
Dec. 31, 2022 term | |
Mission Bay Facility | |
Leases [Line Items] | |
Number of consecutive terms to extend lease | 2 |
Lease extension term | 5 years |
Third Street Facility | |
Leases [Line Items] | |
Number of consecutive terms to extend lease | 1 |
Lease extension term | 5 years |
Operating Leases - Schedule o_2
Operating Leases - Schedule of Lease Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Leases [Abstract] | |||
Operating lease expense | $ 17,057 | $ 19,153 | $ 18,985 |
Variable lease expense | 10,700 | 8,974 | 8,179 |
Total lease expense | $ 27,757 | $ 28,127 | $ 27,164 |
Operating Leases - Schedule o_3
Operating Leases - Schedule of Future Minimum Lease Payments for Operating Leases (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Leases [Abstract] | ||
2023 | $ 19,216 | |
2024 | 21,572 | |
2025 | 22,254 | |
2026 | 22,958 | |
2027 | 23,681 | |
2028 and thereafter | 51,732 | |
Total lease payments | 161,413 | |
Less: portion representing interest | (29,917) | |
Operating lease liabilities | 131,496 | |
Less: current portion | (18,667) | $ (17,441) |
Operating lease liabilities, less current portion | $ 112,829 | $ 125,736 |
Co-Development Agreement with_3
Co-Development Agreement with SFJ Pharmaceuticals and Development Derivative Liability - Additional Information (Details) - SFJ Pharmaceuticals | Feb. 12, 2021 USD ($) |
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | |
Committed funding | $ 150,000,000 |
Collaborative arrangement, success-based payments | $ 637,500,000 |
Co-Development Agreement with_4
Co-Development Agreement with SFJ Pharmaceuticals and Development Derivative Liability - Schedule of Fair Value of Derivative Liability (Details) - Development Derivative Liability - Level 3 - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Fair value as of December 31, 2021 and February 12, 2021 (inception), respectively | $ 27,726 | $ 0 |
Non-cash research and development expense | 4,951 | 16,703 |
Cash receipts from SFJ | 750 | 3,000 |
Change in the fair value of development derivative liability | (33,427) | 8,023 |
Fair value at end of period | $ 0 | $ 27,726 |
Liabilities Related to the Sa_3
Liabilities Related to the Sales of Future Royalties - Additional Information (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||||
Dec. 30, 2020 USD ($) | Dec. 16, 2020 USD ($) | Feb. 24, 2012 USD ($) | Mar. 31, 2014 USD ($) | Mar. 31, 2013 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
Liability Related to the Sale of Future Royalties [Line Items] | |||||||||
Loss on revaluation of liability related to the sale of future royalties | $ 0 | $ 24,410 | $ 0 | ||||||
2012 Purchase and Sale Agreement | |||||||||
Liability Related to the Sale of Future Royalties [Line Items] | |||||||||
Proceeds from sale of royalty rights | $ 124,000 | ||||||||
2012 Purchase and Sale Agreement | Future Royalties | |||||||||
Liability Related to the Sale of Future Royalties [Line Items] | |||||||||
Fair value of liabilities | $ 84,700 | ||||||||
Loss on revaluation of liability related to the sale of future royalties | $ 23,500 | ||||||||
Transaction costs related to revised royalty payments | $ 900 | ||||||||
2012 Purchase and Sale Agreement | Future Royalties | Measurement Input, Discount Rate | |||||||||
Liability Related to the Sale of Future Royalties [Line Items] | |||||||||
Royalties liability, measurement input | 0.160 | ||||||||
2020 Purchase and Sale Agreement | |||||||||
Liability Related to the Sale of Future Royalties [Line Items] | |||||||||
Proceeds from sale of royalty rights | $ 150,000 | ||||||||
Payment of transaction related to purchase and sale agreement | $ 210,000 | ||||||||
Payment of transaction related to purchase and sale agreement if threshold is not achieved | 240,000 | ||||||||
Minimum transaction royalties payments needed to pay the difference between the 2025 threshold and 2020 transaction royalties | $ 208,000 | ||||||||
Transaction costs related to sale of potential future royalties | $ 3,800 | ||||||||
2020 Purchase and Sale Agreement | Measurement Input, Discount Rate | |||||||||
Liability Related to the Sale of Future Royalties [Line Items] | |||||||||
Royalties liability, measurement input | 0.20 | ||||||||
2020 Purchase and Sale Agreement | Measurement Input, Interest Rate | |||||||||
Liability Related to the Sale of Future Royalties [Line Items] | |||||||||
Royalties liability, measurement input | 0.10 | ||||||||
Pursuant to the 2012 Purchase and Sale Agreement | |||||||||
Liability Related to the Sale of Future Royalties [Line Items] | |||||||||
Payment made for milestone not achieved year two | $ 7,000 | ||||||||
Payment made for milestone not achieved year one | $ 3,000 |
Liabilities Related to the Sa_4
Liabilities Related to the Sales of Future Royalties - Schedule of Liability Related to Potential Future Royalties (Detail) - USD ($) $ in Thousands | 12 Months Ended | 24 Months Ended | 130 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2022 | Dec. 31, 2022 | |
Liability Related To Sale Of Future Royalties [Roll Forward] | |||||
Liabilities related to the sales of future royalties—beginning balance | $ 198,344 | $ 0 | |||
Royalty monetization proceeds | 0 | 274,000 | |||
Non-cash royalty revenue | (69,794) | $ (77,746) | $ (48,563) | (403,245) | |
Non-cash interest expense | 28,911 | 47,313 | $ 30,267 | 273,184 | |
Payments to RPI | 0 | (10,000) | |||
Loss on revaluation of liability related to the sale of future royalties | 0 | 23,522 | |||
Liabilities related to the sales of future royalties – ending balance | 157,461 | 198,344 | $ 157,461 | 157,461 | |
Less: unamortized transaction costs | (2,083) | (2,083) | (2,083) | ||
Liabilities related to the sales of future royalties, net | 155,378 | 195,427 | 155,378 | 155,378 | |
2012 Purchase and Sale Agreement | |||||
Liability Related To Sale Of Future Royalties [Roll Forward] | |||||
Liabilities related to the sales of future royalties—beginning balance | 78,282 | 0 | |||
Royalty monetization proceeds | 0 | 124,000 | |||
Non-cash royalty revenue | (33,865) | (316,523) | |||
Non-cash interest expense | 10,750 | 234,168 | |||
Payments to RPI | 0 | (10,000) | |||
Loss on revaluation of liability related to the sale of future royalties | 0 | 23,522 | |||
Liabilities related to the sales of future royalties – ending balance | 55,167 | 78,282 | 55,167 | 55,167 | |
Less: unamortized transaction costs | 0 | 0 | 0 | ||
Liabilities related to the sales of future royalties, net | 55,167 | 55,167 | 55,167 | ||
2020 Purchase and Sale Agreement | |||||
Liability Related To Sale Of Future Royalties [Roll Forward] | |||||
Liabilities related to the sales of future royalties—beginning balance | 120,062 | 0 | |||
Royalty monetization proceeds | 0 | 150,000 | |||
Non-cash royalty revenue | (35,929) | (86,722) | |||
Non-cash interest expense | 18,161 | 39,016 | |||
Payments to RPI | 0 | 0 | |||
Loss on revaluation of liability related to the sale of future royalties | 0 | ||||
Liabilities related to the sales of future royalties – ending balance | 102,294 | $ 120,062 | 102,294 | 102,294 | |
Less: unamortized transaction costs | (2,083) | (2,083) | (2,083) | ||
Liabilities related to the sales of future royalties, net | $ 100,211 | $ 100,211 | $ 100,211 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Indemnification Obligation | ||
Loss Contingencies [Line Items] | ||
Litigation matters, liabilities | $ 0 | $ 0 |
Merger and Acquisition Related Claims | Maximum | ||
Loss Contingencies [Line Items] | ||
Obligations under Director and Officer Indemnifications per incident | 10,000,000 | |
Securities Related Claims | ||
Loss Contingencies [Line Items] | ||
Obligations under Director and Officer Indemnifications per incident | 10,000,000 | |
Non-Securities Related Claims | ||
Loss Contingencies [Line Items] | ||
Obligations under Director and Officer Indemnifications per incident | $ 10,000,000 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Details) - USD ($) | Apr. 03, 2018 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Class of Stock [Line Items] | |||||
Stock issued during period subject to lock-up and stand-still provisions period | 5 years | ||||
Aggregate offering price | $ 300,000,000 | ||||
Losses recorded in AOCI | (366,638,000) | $ (679,508,000) | $ (1,077,295,000) | $ (1,405,391,000) | |
Common Stock | |||||
Class of Stock [Line Items] | |||||
Sale of stock to Bristol-Myers Squibb (in shares) | 8,284,600 | ||||
Losses recorded in AOCI | (19,000) | $ (19,000) | $ (18,000) | $ (17,000) | |
AOCI, Accumulated Gain (Loss), Debt Securities, Available-for-Sale, Parent | |||||
Class of Stock [Line Items] | |||||
Losses recorded in AOCI | 1,800,000 | ||||
Accumulated Foreign Currency Adjustment Attributable to Parent | |||||
Class of Stock [Line Items] | |||||
Losses recorded in AOCI | $ 5,100,000 |
Stockholders' Equity - Schedule
Stockholders' Equity - Schedule of Shares of Common Stock Reserved for Future Issuance (Details) shares in Thousands | Dec. 31, 2022 shares |
Class of Stock [Line Items] | |
Total common stock reserved for issuance | 27,403 |
2017 Performance Incentive Plan | |
Class of Stock [Line Items] | |
Total common stock reserved for issuance | 2,973 |
Employee Stock Purchase Plan | |
Class of Stock [Line Items] | |
Total common stock reserved for issuance | 841 |
Share-based Payment Arrangement, Option, RSUs And PSUs | |
Class of Stock [Line Items] | |
Total common stock reserved for issuance | 23,589 |
License and Collaboration Agr_3
License and Collaboration Agreements - License, Collaboration and Other Revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
License And Collaboration Agreements [Line Items] | |||
License, collaboration and other revenue | $ 1,913 | $ 436 | $ 55,849 |
Bristol-Myers Squibb | Bempegaldesleukin | |||
License And Collaboration Agreements [Line Items] | |||
License, collaboration and other revenue | 0 | 0 | 50,000 |
Other | |||
License And Collaboration Agreements [Line Items] | |||
License, collaboration and other revenue | $ 1,913 | $ 436 | $ 5,849 |
License and Collaboration Agr_4
License and Collaboration Agreements - Additional Information (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Feb. 13, 2018 | Jul. 23, 2017 | Apr. 30, 2018 | Mar. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||||
Net expense reimbursements from collaboration partner | $ 21,400 | |||||||
Accounts receivable | $ 5,981 | $ 5,981 | 22,492 | |||||
Bristol Myers Squibb Collaboration Agreement | ||||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||||
Accounts receivable | 4,200 | 4,200 | ||||||
Bristol-Myers Squibb | Purchase Agreement | ||||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||||
Shares issued (in shares) | 8,284,600 | |||||||
Sale of stock consideration received | $ 850,000 | |||||||
Other | ||||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||||
Potential future additional payments for development milestones | 40,000 | 40,000 | ||||||
Nektar 214 | Bristol-Myers Squibb | ||||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||||
Reimbursement of expenses | $ 20,800 | |||||||
Nektar 214 | Bristol-Myers Squibb | Research and Development | ||||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||||
Reimbursement of expenses | $ 24,900 | $ 45,700 | $ 101,500 | $ 128,200 | ||||
Bristol Myers Squibb Collaboration Agreement | Nektar 214 | Bristol-Myers Squibb | ||||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||||
Percentage of sharing production costs | 35% | |||||||
Bristol Myers Squibb Collaboration Agreement | Nektar 214 | Bristol-Myers Squibb | Opdivo | ||||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||||
Percentage of sharing development costs | 67.50% | |||||||
Nektar-358 | Eli Lilly | ||||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||||
Percentage of sharing in Phase 2 development costs | 75% | |||||||
Nektar-358 | Eli Lilly And Company | Maximum | ||||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||||
Potential future additional development and regulatory milestones | $ 250,000 | |||||||
Nektar's | Bristol Myers Squibb Collaboration Agreement | Nektar 214 | ||||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||||
Percentage of sharing production costs | 65% | |||||||
Upfront and milestone payments received from license agreements | 1,000,000 | |||||||
Nektar's | Bristol Myers Squibb Collaboration Agreement | Nektar 214 | Milestone One | ||||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||||
Potential future additional payments for development milestones | $ 50,000 | |||||||
Nektar's | Bristol Myers Squibb Collaboration Agreement | Nektar 214 | Opdivo | ||||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||||
Percentage of sharing development costs | 32.50% | |||||||
Nektar's | Nektar-358 | ||||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||||
Received upfront and milestone payment | $ 150,000 | |||||||
Percentage of sharing in Phase 2 development costs | 25% | |||||||
Nektar's | Nektar-358 | Eli Lilly And Company | ||||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||||
Percentage of regulatory milestones payments will be reduced under certain conditions | 50% | |||||||
Percentage of regulatory milestones payments will be reduced if conditions occur | 75% | |||||||
Nektar's | Nektar-358 | Eli Lilly And Company | Maximum | ||||||||
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items] | ||||||||
Percentage of funding phase 3 development costs on an indication by indication basis borne | 25% |
Restructuring, Impairment and_3
Restructuring, Impairment and Other Costs of Terminated Program - Narrative (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 7 Months Ended | 9 Months Ended | 12 Months Ended | |||||
Dec. 31, 2022 | May 31, 2022 | Apr. 30, 2022 | Dec. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | Jun. 30, 2022 | |
Restructuring Cost and Reserve [Line Items] | ||||||||||
Impairment of right-of-use assets and property, plant and equipment | $ 65,761 | $ 0 | $ 0 | |||||||
Book value in excess of fair value | $ 67,875 | |||||||||
Third St. Facility | ||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Book value in excess of fair value | $ 12,000 | |||||||||
Measurement Input, Market Participant Subtenant Borrowing Rate | ||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Operating lease, measurement input | 7.90% | 6.40% | ||||||||
Nektar 214 | Bristol-Myers Squibb | ||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Reimbursement of expenses | $ 20,800 | |||||||||
Employee Severance | ||||||||||
Restructuring Cost and Reserve [Line Items] | ||||||||||
Percent of positions eliminated | 70% | |||||||||
Entity number of employees | 225 | 735 |
Restructuring, Impairment and_4
Restructuring, Impairment and Other Costs of Terminated Program - Summary of Restructuring Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Restructuring and Related Activities [Abstract] | |||
Clinical trial expense, other third-party and employee costs for the wind down of the bempegaldesleukin program | $ 31,693 | ||
Severance and benefit expense | 30,904 | ||
Impairment of right-of-use assets and property, plant and equipment | 65,761 | $ 0 | $ 0 |
(Gain) loss on sale or disposal of property, plant and equipment, net | (3,326) | $ 0 | $ 0 |
Contract termination and other restructuring costs | 10,898 | ||
Restructuring, impairment and other costs of terminated program | $ 135,930 |
Restructuring, Impairment and_5
Restructuring, Impairment and Other Costs of Terminated Program - Restructuring Reserve Rollforward (Details) $ in Thousands | 3 Months Ended |
Sep. 30, 2022 USD ($) | |
Employee Severance | |
Restructuring Reserve [Roll Forward] | |
Liability balance as of March 31, 2022 | $ 0 |
Expense recognized during the period | 30,904 |
Payments during the period | (27,605) |
Liability balance as of December 31, 2022 | 3,299 |
No service period | |
Restructuring Reserve [Roll Forward] | |
Liability balance as of March 31, 2022 | 0 |
Expense recognized during the period | 22,993 |
Payments during the period | (22,993) |
Liability balance as of December 31, 2022 | 0 |
Service period required | |
Restructuring Reserve [Roll Forward] | |
Liability balance as of March 31, 2022 | 0 |
Expense recognized during the period | 7,911 |
Payments during the period | (4,612) |
Liability balance as of December 31, 2022 | $ 3,299 |
Restructuring, Impairment and_6
Restructuring, Impairment and Other Costs of Terminated Program - Sublease Information (Details) - USD ($) $ in Thousands | 7 Months Ended | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | May 31, 2022 | |
Restructuring Cost and Reserve [Line Items] | |||||
Book value in excess of fair value | $ 67,875 | ||||
Less: Amounts recorded as amortization between May 31 and December 31, 2022 for Third St. facility | (2,114) | ||||
Total impairment of sublease assets | $ 65,761 | $ 0 | $ 0 | ||
Reported Value Measurement | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Property, plant and equipment and Operating lease right-of-use assets | $ (88,829) | ||||
Estimate of Fair Value Measurement | Level 3 | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Property, plant and equipment and Operating lease right-of-use assets | (20,954) | (20,954) | |||
Sublease Property, Plant And Equipment | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Book value in excess of fair value | 56,307 | ||||
Less: Amounts recorded as amortization between May 31 and December 31, 2022 for Third St. facility | (1,717) | ||||
Total impairment of sublease assets | 54,590 | ||||
Sublease Property, Plant And Equipment | Reported Value Measurement | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Property, plant and equipment and Operating lease right-of-use assets | (72,481) | ||||
Sublease Property, Plant And Equipment | Estimate of Fair Value Measurement | Level 3 | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Property, plant and equipment and Operating lease right-of-use assets | (16,174) | (16,174) | |||
Sublease Operating Lease Right of Use Assets | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Book value in excess of fair value | 11,568 | ||||
Less: Amounts recorded as amortization between May 31 and December 31, 2022 for Third St. facility | (397) | ||||
Total impairment of sublease assets | 11,171 | ||||
Sublease Operating Lease Right of Use Assets | Reported Value Measurement | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Property, plant and equipment and Operating lease right-of-use assets | $ (16,348) | ||||
Sublease Operating Lease Right of Use Assets | Estimate of Fair Value Measurement | Level 3 | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Property, plant and equipment and Operating lease right-of-use assets | $ (4,780) | $ (4,780) |
Restructuring, Impairment and_7
Restructuring, Impairment and Other Costs of Terminated Program - Schedule of Property, Plant and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Restructuring Cost and Reserve [Line Items] | |||
Proceeds from sales | $ 13,196 | $ 0 | $ 0 |
Property, plant and equipment, net | 32,451 | $ 60,510 | |
Facility Closing | |||
Restructuring Cost and Reserve [Line Items] | |||
Proceeds from sales | 13,196 | ||
Property, plant and equipment, net | 9,870 | ||
Total (gain) loss on sale or disposal of property, plan and equipment, net | $ (3,326) |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Details) | 12 Months Ended | |||
Dec. 31, 2022 USD ($) $ / shares shares | Dec. 31, 2021 USD ($) $ / shares | Dec. 31, 2020 USD ($) $ / shares | Jun. 08, 2022 shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Change in control severance payment period for executives | 12 months | |||
Total unrecognized compensation costs | $ 83,100,000 | |||
Recognized over a weighted-average period | 2 years 3 months 18 days | |||
Dividend yield | 0% | 0% | 0% | |
Total intrinsic value of options exercised | $ 17,300,000 | $ 15,900,000 | ||
Maximum 401(k) per employee, percentage of annual salary | 60% | |||
Matching 401(k) employer contribution, maximum amount | $ 12,000 | 6,000 | 6,000 | |
Compensation expense in connection with 401(k) retirement plan | $ 2,500,000 | $ 3,600,000 | $ 3,500,000 | |
2017 Performance Incentive Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of shares authorized | shares | 39,200,000 | 5,000,000 | ||
Share-based compensation plan's share limit reduction for every one restricted stock unit granted | 1.5 | |||
Stock options term under equity incentive plans | 8 years | |||
Stock Options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Dividend yield | 0% | |||
Stock Options | 2017 Performance Incentive Plan | Employee | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Service period for stock-based compensation award granted | 4 years | |||
Stock Options | 2017 Performance Incentive Plan | Director | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Service period for stock-based compensation award granted | 1 year | |||
RSUs and PSUs | 2017 Performance Incentive Plan | Employee | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Service period for stock-based compensation award granted | 3 years | |||
Employee Stock Purchase Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Offering period | 6 months | |||
Employee Stock Purchase Plan | Employee Stock Purchase Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Purchase price of common stock, percent | 85% | |||
Number of common stock shares available for stock options grants (in shares) | shares | 3,500,000 | |||
Restricted Stock Units (RSU) | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Granted (in dollars per share) | $ / shares | $ 4.14 | $ 14.68 | $ 19.24 | |
Fair value of restricted stock vested | $ 17,500,000 | $ 45,300,000 | $ 33,300,000 |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total stock-based compensation | $ 57,320 | $ 94,674 | $ 94,261 |
Cost of goods sold | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total stock-based compensation | 2,824 | 2,779 | 2,825 |
Research and development | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total stock-based compensation | 27,727 | 54,821 | 57,116 |
General and administrative | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total stock-based compensation | 24,488 | 37,074 | 33,295 |
Restructuring, impairment and other costs of terminated program | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total stock-based compensation | $ 2,281 | $ 0 | $ 1,025 |
Stock-Based Compensation - Sc_2
Stock-Based Compensation - Schedule of Black-Scholes Option-Pricing Model Assumptions Used to Calculate Fair Value of Employee Stock Options (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share-Based Payment Arrangement [Abstract] | |||
Average risk-free interest rate | 2.90% | 1.20% | 0.40% |
Dividend yield | 0% | 0% | 0% |
Average volatility factor | 77.90% | 63.80% | 64.10% |
Weighted-average expected life | 5 years 7 months 6 days | 5 years 6 months | 5 years 7 months 6 days |
Weighted-average grant-date fair value of options granted (in dollars per share) | $ 3.18 | $ 8.07 | $ 10.70 |
Stock-Based Compensation - Sc_3
Stock-Based Compensation - Schedule of Stock Option Activity Under Equity Incentive Plans (Details) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended |
Dec. 31, 2022 USD ($) $ / shares shares | |
Number of Shares | |
Outstanding, beginning balance (in shares) | shares | 13,542 |
Options granted (in shares) | shares | 6,276 |
Options exercised (in shares) | shares | (15) |
Options forfeited and canceled (in shares) | shares | (5,715) |
Outstanding, ending balance (in shares) | shares | 14,088 |
Weighted- Average Exercise Price per Share | |
Outstanding, beginning balance (in dollars per share) | $ / shares | $ 23.62 |
Options granted (in dollars per share) | $ / shares | 4.76 |
Options exercised (in dollars per share) | $ / shares | 12.43 |
Options forfeited and canceled (in dollars per share) | $ / shares | 20.73 |
Outstanding, ending balance (in dollars per share) | $ / shares | $ 16.40 |
Weighted- Average Remaining Contractual Life (in Years) | |
Weighted-Average Remaining Contractual Life, Outstanding | 5 years 8 months 15 days |
Aggregate Intrinsic Value, Outstanding | $ | $ 0 |
Number of Shares, Exercisable (in shares) | shares | 6,029 |
Weighted-Average Exercise Price Per Share, Exercisable (in dollars per share) | $ / shares | $ 27.82 |
Weighted-Average Remaining Contractual Life, Exercisable | 3 years 7 months 6 days |
Aggregate Intrinsic Value, Exercisable | $ | $ 0 |
Stock-Based Compensation - Sc_4
Stock-Based Compensation - Schedule of Restricted Stock Unit Award Activity (Details) - Restricted Stock Units (RSU) - $ / shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Units Issued | |||
Beginning balance (in shares) | 9,930 | ||
Granted (in shares) | 7,708 | ||
Vested and released (in shares) | (2,872) | ||
Forfeited and canceled (in shares) | (5,454) | ||
Ending balance (in shares) | 9,312 | 9,930 | |
Weighted- Average Grant Date Fair Value | |||
Beginning balance (in dollars per share) | $ 16.80 | ||
Granted (in dollars per share) | 4.14 | $ 14.68 | $ 19.24 |
Vested and released (in dollars per share) | 17.64 | ||
Forfeited and canceled (in dollars per share) | 15.68 | ||
Ending balance (in dollars per share) | $ 6.81 | $ 16.80 |
Income Taxes - Schedule of Inco
Income Taxes - Schedule of Income (Loss) Before Provision for Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |||
Domestic | $ (371,900) | $ (524,440) | $ (445,370) |
Foreign | 6,917 | 1,160 | 1,423 |
Loss before provision for income taxes | $ (364,983) | $ (523,280) | $ (443,947) |
Income Taxes - Schedule of Prov
Income Taxes - Schedule of Provision for Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Current: | |||
Federal | $ 0 | $ 0 | $ 0 |
State | (608) | 50 | 165 |
Foreign | 1,115 | 609 | 364 |
Total current income tax expense | 507 | 659 | 529 |
Deferred: | |||
Federal | 0 | 0 | 0 |
State | 0 | 0 | 0 |
Foreign | 2,708 | (102) | (36) |
Total deferred income tax expense | 2,708 | (102) | (36) |
Provision for income taxes | $ 3,215 | $ 557 | $ 493 |
Income Taxes - Schedule of In_2
Income Taxes - Schedule of Income Tax Provision Related to Continuing Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |||
Income tax benefit at federal statutory rate | $ (76,647) | $ (109,889) | $ (93,229) |
Research credits | (987) | (4,727) | (3,081) |
Change in valuation allowance | 51,108 | 97,914 | 87,060 |
Expiration of net operating loss carryforwards | 12,348 | 286 | 286 |
Stock-based compensation | 15,778 | 6,627 | 7,929 |
Non-cash interest expense on liability related to sales of future royalties | 6,071 | 9,936 | 6,356 |
Non-cash royalty revenue related to sales of future royalties | (7,112) | (7,891) | (7,967) |
Loss on revaluation of liability related to the sale of future royalties | 0 | 4,940 | 0 |
Other | 2,656 | 3,361 | 3,139 |
Provision for income taxes | $ 3,215 | $ 557 | $ 493 |
Income Taxes - Schedule of Sign
Income Taxes - Schedule of Significant Components of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Deferred tax assets: | ||
Net operating loss carryforwards | $ 545,508 | $ 564,712 |
Research and other credits | 142,198 | 139,996 |
Net capital loss carryforwards | 38,445 | 0 |
Operating lease liabilities | 28,254 | 34,680 |
Stock-based compensation | 22,110 | 33,408 |
Capitalized research and development costs | 24,134 | 0 |
Liability related to the sale of future royalties | 13,424 | 23,757 |
Other | 13,935 | 17,290 |
Deferred tax assets before valuation allowance | 828,008 | 813,843 |
Valuation allowance for deferred tax assets | (816,235) | (785,748) |
Total deferred tax assets | 11,773 | 28,095 |
Deferred tax liabilities: | ||
Operating lease right-of-use assets | (11,335) | (27,204) |
Investment in foreign subsidiary | (2,451) | 0 |
Other | (392) | (564) |
Total deferred tax liabilities | (14,178) | (27,768) |
Total deferred tax liabilities | $ (2,405) | |
Net deferred tax assets (liabilities) | $ 327 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Taxes Disclosure [Line Items] | |||
Increase in valuation allowance | $ 30,500 | $ 115,600 | |
Operating loss carryforwards, subject to expiration | 1,300,000 | ||
Income tax research credits | 987 | 4,727 | $ 3,081 |
Unrecognized tax benefits, interest recognized | 0 | 0 | 0 |
Unrecognized tax benefits, penalties recognized | $ 0 | $ 0 | $ 0 |
Unrecognized tax benefits, period may increase or decrease due to tax examination | 12 months | ||
Federal | |||
Income Taxes Disclosure [Line Items] | |||
Operating loss carryforwards | $ 2,400,000 | ||
Income tax research credits | 123,800 | ||
State | |||
Income Taxes Disclosure [Line Items] | |||
Operating loss carryforwards | 700,000 | ||
Income tax research credits | $ 48,800 |
Income Taxes - Schedule of Unre
Income Taxes - Schedule of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Beginning balance | $ 80,604 | $ 78,665 | $ 77,410 |
Tax positions related to current year: | |||
Additions | 378 | 2,371 | 2,512 |
Reductions | 0 | 0 | 0 |
Tax positions related to prior years: | |||
Additions | 5,272 | 58 | 193 |
Reductions | 0 | (490) | (1,450) |
Settlements | 0 | 0 | 0 |
Lapses in statute of limitations | (409) | 0 | 0 |
Ending balance | $ 85,845 | $ 80,604 | $ 78,665 |
Segment Reporting - Additional
Segment Reporting - Additional Information (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 USD ($) segment | Dec. 31, 2021 USD ($) | Dec. 31, 2020 | |
Segment Reporting Information [Line Items] | |||
Number of operating business segment | segment | 1 | ||
Property, plant and equipment, net | $ 32,451 | $ 60,510 | |
United States | |||
Segment Reporting Information [Line Items] | |||
Property, plant and equipment, net | $ 56,100 | ||
Revenue | UCB | Customer Concentration Risk | |||
Segment Reporting Information [Line Items] | |||
Percentage revenue from customers | 37% | 36% | 23% |
Revenue | Baxalta Incorporated Or Takeda P L C | Customer Concentration Risk | |||
Segment Reporting Information [Line Items] | |||
Percentage revenue from customers | 25% | 23% | 14% |
Revenue | Astra Zeneca Ab | Customer Concentration Risk | |||
Segment Reporting Information [Line Items] | |||
Percentage revenue from customers | 14% | 16% | 13% |
Revenue | Pfizer | Customer Concentration Risk | |||
Segment Reporting Information [Line Items] | |||
Percentage revenue from customers | 11% | 13% | |
Revenue | BMS | Customer Concentration Risk | |||
Segment Reporting Information [Line Items] | |||
Percentage revenue from customers | 33% | ||
Property, Plant and Equipment | Geographic Concentration Risk | United States | |||
Segment Reporting Information [Line Items] | |||
Percentage revenue from customers | 93% |
Segment Reporting - Revenue by
Segment Reporting - Revenue by Geographic Area (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Revenue by geographic area | |||
Total revenue | $ 92,055 | $ 101,907 | $ 152,915 |
United States | Reportable Geographical Components | |||
Revenue by geographic area | |||
Total revenue | 9,841 | 10,114 | 64,966 |
Rest of World | Reportable Geographical Components | |||
Revenue by geographic area | |||
Total revenue | $ 82,214 | $ 91,793 | $ 87,949 |