2 unchanged sentences
In designing and evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated, can only provide reasonable assurance of achieving the desired control objectives, and in reaching a reasonable level of assurance, management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.
−Removed: As required by SEC Rule 13a-15(b), we carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the year covered by this report.
+Added: As required by Rule 13a-15(b) of the Exchange Act, we carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Exchange Act Rule 13a–15(e) and 15d-15(e)), as of the end of the year covered by this report.
Based on the foregoing, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective at the reasonable assurance level.
−Removed: Management’s Report on Internal Control Over Financial Reporting
+Added: Management’s Annual Report on Internal Control Over Financial Reporting
Internal control over financial reporting refers to the process designed by, or under the supervision of, our Chief Executive Officer and Chief Financial Officer, and effected by our board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles, and includes those policies and procedures that:
22 unchanged sentences
In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2021, based on the COSO criteria .
−Removed: We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the consolidated balance sheets of the Company and subsidiaries as of December 31, 2020 and 2019, the related consolidated statements of operations and comprehensive loss, stockholders’ equity, and cash flows for each of the three years in the period ended December 31, 2020, and the related notes and our report dated March 1, 2021 expressed an unqualified opinion thereon.
+Added: We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the consolidated balance sheets of the Company and subsidiaries as of December 31, 2021 and 2020, the related consolidated statements of operations and comprehensive loss, stockholders’ equity, and cash flows for each of the three years in the period ended December 31, 2021, and the related notes and our report dated February 24, 2022, expressed an unqualified opinion thereon.
Basis for Opinion
17 unchanged sentences
San Diego, California
−Removed: March 1, 2021
+Added: February 24, 2022
OTHER INFORMATION
+Added: DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS
+Added: Not applicable.
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
−Removed: Information required by this item will be contained in our Definitive Proxy Statement for our 2021 Annual Meeting of Stockholders, to be filed pursuant to Regulation 14A with the Securities and Exchange Commission within 120 days of December 31, 2020.
+Added: Information required by this item will be contained under the captions "Election of Directors," "Information Regarding the Board of Directors and Corporate Governance," in our Definitive Proxy Statement for our 2022 Annual Meeting of Stockholders, to be filed pursuant to Regulation 14A with the Securities and Exchange Commission within 120 days of December 31, 2021 (the "Proxy Statement").
Such information is incorporated herein by reference.
+Added: We have adopted a Code of Business Conduct that applies to our directors and employees (including our principal executive officer, principal financial officer, principal accounting officer and controller), and have posted the text of the policy on our website (https://ir.travere.com/governance-documents).
+Added: In addition, we intend to promptly disclose on our website in the future (i) the date and nature of any amendment (other than technical, administrative or other non-substantive amendments) to the policy that applies to our principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions and relates to any element of the code of ethics definition enumerated in Item 406(b) of Regulation S-K, and (ii) the nature of any waiver, including an implicit waiver, from a provision of the policy that is granted to one of these specified individuals that relates to one or more of the elements of the code of ethics definition enumerated in Item 406(b) of Regulation S-K, the name of such person who is granted the waiver and the date of the waiver.
EXECUTIVE COMPENSATION
−Removed: Information required by this item will be contained in our Definitive Proxy Statement for our 2021 Annual Meeting of Stockholders, to be filed pursuant to Regulation 14A with the Securities and Exchange Commission within 120 days of December 31, 2020.
+Added: Information required by this item will be contained under the captions “Compensation Discussion and Analysis,” “Executive Compensation,” “Director Compensation Summary” and “Compensation Committee Interlocks and Insider Participation” in the Proxy Statement.
Such information is incorporated herein by reference.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
−Removed: Information required by this item will be contained in our Definitive Proxy Statement for our 2021 Annual Meeting of Stockholders, to be filed pursuant to Regulation 14A with the Securities and Exchange Commission within 120 days of December 31, 2020.
+Added: Information required by this item will be contained under the captions “Security Ownership of Certain Beneficial Owners and Management” and “Securities Authorized for Issuance Under Equity Compensation Plans” in the Proxy Statement.
Such information is incorporated herein by reference.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
−Removed: Information required by this item will be contained in our Definitive Proxy Statement for our 2021 Annual Meeting of Stockholders, to be filed pursuant to Regulation 14A with the Securities and Exchange Commission within 120 days of December 31, 2020.
+Added: Information required by this item will be contained under the caption “Transaction With Related Persons” and “Information Regarding the Board of Directors and Corporate Governance” in the Proxy Statement.
Such information is incorporated herein by reference.
PRINCIPAL ACCOUNTING FEES AND SERVICES
−Removed: Information required by this item will be contained in our Definitive Proxy Statement for our 2021 Annual Meeting of Stockholders, to be filed pursuant to Regulation 14A with the Securities and Exchange Commission within 120 days of December 31, 2020.
+Added: Information required by this item will be contained under the caption “Principal Accountant Fees and Services” in the Proxy Statement.
Such information is incorporated herein by reference.
12 unchanged sentences
3.2 Certificate of Amendment of Certificate of Incorporation of the Company (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K, filed with the SEC on June 11, 2015).
−Removed: 3.3 Certificate of Amendment of Certificate of Incorporation of the Company (incorporated by reference to Exhibit 3.
−Removed: 2 to the Company’s Current Report on Form 8-K, filed with the SEC on November 16, 2020).
−Removed: 3.4 Amended and Restated Bylaws of the Company (incorporated by reference to Exhibit 3.
−Removed: 1 to the Company’s Current Report on Form 8-K, filed with the SEC on November 16, 2020).
−Removed: 4.1 Reference is made to Exhibits to 3.1 , 3.2 , 3.3 and 3.4 .
+Added: 3.3 Certificate of Amendment of Certificate of Incorporation of the Company (incorporated by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K, filed with the SEC on November 16, 2020).
+Added: 3.4 Certificate of Amendment to the Certificate of Incorporation of the Company (incorporated by reference to Exhibit 3.1 to the Company's Current Report on Form 8-K, filed with the SEC on May 18, 2021).
+Added: 3.5 Amended and Restated Bylaws of the Company (incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K, filed with the SEC on November 16, 2020).
+Added: 3.6 Certificate of Amendment of Bylaws of the Company, effective June 9, 2021 (incorporated by reference to Exhibit 3.1 to the Company's Current Report on Form 8-K, filed with the SEC on June 10, 2021).
+Added: 4.1 Reference is made to Exhibits to 3.1 , 3.2 , 3.3 , 3.4 , 3.
4.2 Description of Common Stock.
3 unchanged sentences
Bank National Association, as Trustee (including the form of 2.50% Convertible Senior Note due 2025) (incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K, filed with the SEC on September 10, 2018).
−Removed: 10.1 Trademark License and Supply Agreement, dated May 29, 2014, by and between the Company and Mission Pharmacal Company (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the SEC on June 4, 2014).
−Removed: 10.2 First Amendment to Trademark License and Supply Agreement, effective as of July 28, 2014, by and between Mission Pharmacal Company and the Company (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the SEC on July 29, 2014).
−Removed: 10.3 International Rights Purchase Agreement, dated as of March 26, 2014, by and between Manchester Pharmaceuticals LLC and Retrophin Therapeutics International, LLC (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the SEC on March 31, 2014).
−Removed: 10.4+ Sublicense Agreement, dated February 16, 2012, by and among Ligand Pharmaceuticals Incorporated, a Delaware corporation, Pharmacopeia, Inc., a Delaware limited liability company, and the Company, a Delaware limited liability company (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the SEC on December 19, 2012).
+Added: 10.1 Form of Indemnity Agreement (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q, filed with the SEC on May 1, 2018 ) .
+Added: 10.2† Employment Agreement, dated January 4, 2019, by and between the Company and Eric M.
+Added: Dube (incorporated by reference to Exhibit 10.34 to the Company’s Annual Report on Form 10-K, filed with the SEC on February 26, 2019).
10.3† Employment Agreement, dated March 2, 2015, by and between the Company and Laura M.
Clague (incorporated by reference to Exhibit 10.25 to the Company’s Annual Report on Form 10-K, filed with the SEC on March 11, 2015).
−Removed: 10.6† The Company's 2014 Incentive Compensation Plan as amended (incorporated by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K, filed with the SEC on February 9, 2015).
−Removed: 10.7+ Amendment No.
−Removed: 4 to Sublicense Agreement dated as of September 17, 2015, between the Company and Ligand Pharmaceuticals Incorporated (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q/A, filed with the SEC on December 22, 2015).
−Removed: 10.8 Addendum to Trademark License and Supply Agreement, dated October 19, 2015, by and between to Company and Mission Pharmacal (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q, filed with the SEC on November 6, 2015).
−Removed: 10.9+ Amendment No.
−Removed: 3 to Sublicense Agreement dated as of February 27, 2015, between the Company and Ligand Pharmaceuticals Incorporated (incorporated by reference to Exhibit 10.5 to the Company’s Quarterly Report on Form 10-Q, filed with the SEC on May 11, 2015).
−Removed: 10.10+ Amendment One to the Third Amendment to Trademark License and Supply Agreement, dated September 12, 2016, by and between the Company and Mission Pharmacal Company (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q, filed with the SEC on November 4, 2016).
−Removed: 10.11+ Amendment Two to the Third Amendment to Trademark License and Supply Agreement, dated November 3, 2017, by and between the Company and Mission Pharmacal Company (incorporated by reference to Exhibit 10.20 to the Company’s Annual Report on Form 10-K, filed with the SEC on February 27, 2018).
−Removed: 10.12+ Third Amendment to Trademark License and Supply Agreement dated as of March 17, 2016, between the Comp any and Mission Pharmacal.
−Removed: (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q, filed with the SEC on May 5, 2016).
−Removed: 10.13 Fourth Amendment to Trademark License and Supply Agreement dated as of November 28, 2018, between the Company and Mission Pharmacal (incorporated by reference to Exhibit 10.19 to the Company’s Annual Report on Form 10-K, filed with the SEC on February 26, 2019).
−Removed: 10.14+ Fifth Amendment to Trademark License and Supply Agreement dated as of September 30, 2020, between the Company and Mission Pharmacal Company (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q, filed with the SEC on November 5, 2020).
−Removed: 10.15 The Company's 2015 Equity Incentive Plan, as amended (incorporated by reference to Exhibit 99.1 to the Company's current report on Form 8-K, filed with the SEC on May 18, 2017).
10.4† Amendment to Employment Agreement, entered into as of April 11, 2017 and modifies the Employment Agreement dated March 2, 2015, by and between the Company and Laura M.
Clague (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q, filed with the SEC on May 5, 2017).
−Removed: 10.17 The Company's 2017 Employee Stock Purchase Plan (incorporated by reference to Exhibit 99.2 to the Company's current report on Form 8-K, filed with the SEC on May 18, 2017)
+Added: 10.5† Employment Agreement, dated February 13, 2017, and Amendment to Employment Agreement, dated April 11, 2017, by and between the Company and William Rote (incorporated by reference to Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q, filed with the SEC on May 1, 2018)
+Added: 10.6† Employment Agreement, dated February 6, 2017, and Amendment to Employment Agreement, dated April 11, 2017, by and between the Company and Elizabeth E.
+Added: Reed (incorporated by reference to Exhibit 10.4 to the Company’s Quarterly Report on Form 10-Q, filed with the SEC on May 1, 2018)
+Added: 10.7† Employment Agreement, dated October 1, 2019, by and between the Company and Peter Heerma (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q, filed with the SEC on May 5, 2020).
+Added: 10.8† Employment Agreement, dated July 26, 2018, by and between the Company and Noah Rosenberg, M.D.
+Added: (incorporated by reference to Exhibit 10.35 to the Company’s Annual Report on Form 10-K, filed with the SEC on February 26, 2019).
+Added: 10.9† Transition Agreement, dated October 12, 2021, between the Company and Noah Rosenberg, M.D.
+Added: (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K, filed with the SEC on October 12, 2021.
+Added: 10.10† Consulting Services Agreement dated January 1, 2022, between the Company and Noah Rosenberg, M.D.
+Added: (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K, filed with the SEC on January 6 , 2022).
+Added: 10.11† Retirement Agreement, dated January 4, 2019, by and between the Company and Stephen Aselage (incorporated by reference to Exhibit 10.33 to the Company’s Annual Report on Form 10-K, filed with the SEC on February 26, 2019).
+Added: 10.12† Non-Employee Director Compensation Program (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q, filed with the SEC on May 11, 2020).
+Added: 10.13† The Company's 2021 Executive Officer Annual Bonus Plan (incorporated by reference to Exhibit 10.38 to the Company's Annual Report on Form 10-K, filed with the SEC on March 1, 2021).
+Added: 10.14† The Company's 2022 Executive Officer Annual Bonus Plan.
+Added: 10.15† The Company's 2014 Incentive Compensation Plan as amended (incorporated by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K, filed with the SEC on February 9, 2015).
+Added: 10.16† The Company's 2015 Equity Incentive Plan, as amended (incorporated by reference to Exhibit 99.1 to the Company's C urrent R eport on Form 8-K, filed with the SEC on May 18, 2017).
10.17† Form of Stock Option Grant Notice, Option Agreement and Notice of Exercise for Inducement Grant Outside of 2015 Equity Incentive Plan (incorporated by reference to Exhibit 99.3 to the Company's current report on Form S-8, filed with the SEC on June 8, 2017).
10.18† Form of Restricted Stock Unit Grant Notice and Restricted Stock Unit Award Agreement for Inducement Grant Outside of 2015 Equity Incentive Plan(incorporated by reference to Exhibit 99.4 to the Company's current report on Form S-8, filed with the SEC on June 8, 2017).
−Removed: 10.2† The Company's 2018 Equity Incentive Plan, Form of Stock Option Grant Notice, Option Agreement and Exercise Notice, Form of Restricted Stock Unit Award Agreement for use thereunder.
−Removed: (incorporated by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K, filed with the SEC on May 10, 2018)
−Removed: 10.21† The Company's 2018 Equity Incentive Plan, as amended, and, Form of Stock Option Grant Notice, Option Agreement and Exercise Notice, Form of Restricted Stock Unit Grant Notice and Restricted Stock Unit Award Agreement for use thereunder (incorporated by reference to Exhibit 99.1 to the Company’s Registration Statement on Form S-8 (File No.
−Removed: 333-232857), filed with the SEC on July 26, 2019).
−Removed: 10.22† The Company's 2018 Equity Incentive Plan, as amended, and, Form of Stock Option Grant Notice, Option Agreement and Exercise Notice, Form of Restricted Stock Unit Grant Notice and Restricted Stock Unit Award Agreement for use thereunder (incorporated by reference to Exhibit 99.1 to the Company’s Current Report on Form 8-K, filed with the SEC on May 19, 2020).
+Added: 10.19† The Company's 2017 Employee Stock Purchase Plan (incorporated by reference to Exhibit 99.2 to the Company's C urrent report on Form 8-K, filed with the SEC on May 18, 2017 ) .
+Added: 10.20† The Company's 2018 Equity Incentive Plan, as amended (incorporated by reference to Exhibit 99.1 to the Company's Current Report on Form 8-K, filed with the SEC on May 18, 2021).
+Added: 10.21† Form of Stock Option Grant Notice, Option Agreement and Exercise Notice for use under the Company's 2018 Equity Incentive Plan, as amended.
+Added: 10.22† Form of Restricted Stock Unit Grant Notice and Restricted Stock Unit Award Agreement for use under the Company's 2018 Equity Incentive Plan, as amended.
10.23† Form of Stock Option Grant Notice, Option Agreement and Notice of Exercise for Inducement Grant Outside of 2018 Equity Incentive Plan, as amended (incorporated by reference to Exhibit 99.2 to the Company’s Registration Statement on Form S-8 (File No.
2 unchanged sentences
333-232857), filed with the SEC on July 26, 2019).
−Removed: 10.25 Form of Indemnity Agreement (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q, filed with the SEC on May 1, 2018)
+Added: 10.25+¥ Sublicense Agreement, dated February 16, 2012, by and among Ligand Pharmaceuticals Incorporated, a Delaware corporation, Pharmacopeia, Inc., a Delaware limited liability company, and the Company, a Delaware limited liability company .
10.26* Amendment No.
+Added: 3 to Sublicense Agreement dated as of February 27, 2015, between the Company and Ligand Pharmaceuticals Incorporated .
+Added: 10.27* Amendment No.
+Added: 4 to Sublicense Agreement dated as of September 17, 2015, between the Company and Ligand Pharmaceuticals Incorporated .
+Added: 10.28 Amendment No.
5 to Sublicense Agreement dated as of March 20, 2018, between the Company and Ligand Pharmaceuticals Incorporated (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q, filed with the SEC on May 1, 2018 ) .
−Removed: 10.27† Employment Agreement, dated February 13, 2017, and Amendment to Employment Agreement, dated April 11, 2017, by and between the Company and William Rote (incorporated by reference to Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q, filed with the SEC on May 1, 2018)
−Removed: 10.28† Employment Agreement, dated February 6, 2017, and Amendment to Employment Agreement, dated April 11, 2017, by and between the Company and Elizabeth E.
−Removed: Reed (incorporated by reference to Exhibit 10.4 to the Company’s Quarterly Report on Form 10-Q, filed with the SEC on May 1, 2018)
−Removed: 10.29† Retirement Agreement, dated January 4, 2019, by and between the Company and Stephen Aselage (incorporated by reference to Exhibit 10.33 to the Company’s Annual Report on Form 10-K, filed with the SEC on February 26, 2019).
−Removed: 10.3† Employment Agreement, dated January 4, 2019, by and between the Company and Eric M.
−Removed: Dube (incorporated by reference to Exhibit 10.34 to the Company’s Annual Report on Form 10-K, filed with the SEC on February 26, 2019).
−Removed: 10.31† Employment Agreement, dated July 26, 2018, by and between the Company and Noah Rosenberg, M.D.
−Removed: (incorporated by reference to Exhibit 10.35 to the Company’s Annual Report on Form 10-K, filed with the SEC on February 26, 2019).
+Added: 10.29 International Rights Purchase Agreement, dated as of March 26, 2014, by and between Manchester Pharmaceuticals LLC and Retrophin Therapeutics International, LLC (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the SEC on March 31, 2014).
+Added: 10.30 Trademark License and Supply Agreement, dated May 29, 2014, by and between the Company and Mission Pharmacal Company (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the SEC on June 4, 2014).
+Added: 10.31 First Amendment to Trademark License and Supply Agreement, effective as of July 28, 2014, by and between Mission Pharmacal Company and the Company (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the SEC on July 29, 2014).
+Added: 10.32 Addendum to Trademark License and Supply Agreement, dated October 19, 2015, by and between to Company and Mission Pharmacal (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q, filed with the SEC on November 6, 2015).
+Added: 10.33+ Third Amendment to Trademark License and Supply Agreement dated as of March 17, 2016, between the Company and Mission Pharmacal.
+Added: (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q, filed with the SEC on May 5, 2016).
+Added: 10.34+ Amendment One to the Third Amendment to Trademark License and Supply Agreement, dated September 12, 2016, by and between the Company and Mission Pharmacal Company (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q, filed with the SEC on November 4, 2016).
+Added: 10.35+ Amendment Two to the Third Amendment to Trademark License and Supply Agreement, dated November 3, 2017, by and between the Company and Mission Pharmacal Company (incorporated by reference to Exhibit 10.20 to the Company’s Annual Report on Form 10-K, filed with the SEC on February 27, 2018).
+Added: 10.36 Fourth Amendment to Trademark License and Supply Agreement dated as of November 28, 2018, between the Company and Mission Pharmacal (incorporated by reference to Exhibit 10.19 to the Company’s Annual Report on Form 10-K, filed with the SEC on February 26, 2019).
+Added: 10.37+ Fifth Amendment to Trademark License and Supply Agreement dated as of September 30, 2020, between the Company and Mission Pharmacal Company (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q, filed with the SEC on November 5, 2020).
+Added: 10.38¥* Master Manufacturing Supply Agreement, dated September 30, 2020, between the Company and STA Pharmaceutical Hong Kong Limited, a subsidiary of WuXi AppTec (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q, filed with the SEC on November 5, 2020).
+Added: 10.39¥* License and Collaboration Agreement, dated September 15, 2021, by and among Orphan Technologies and Vifor (International) Ltd., and, solely with respect to Article 15, the Company (incorporated by reference to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q, filed with the SEC on October 29, 2021).
+Added: 10.40¥* Commercial Supply Agreement, dated December 21, 2021, between the Company and Catalent Pharma Solutions, LLC.
10.41 Office Lease, effective April 12, 2019, between the Company and Kilroy Realty, L.P.
4 unchanged sentences
(incorporated by reference to Exhibit 99.2 to the Company’s Current Report on Form 8-K, filed with the SEC on June 8, 2020).
−Removed: 10.35† Non-Employee Director Compensation Program.
−Removed: (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q, filed with the SEC on May 11, 2020).
−Removed: 10.36† Employment Agreement, dated October 1, 2019, by and between the Company and Peter Heerma (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q, filed with the SEC on May 5, 2020).
−Removed: 10.37¥* Master Manufacturing Supply Agreement, dated September 30, 2020, between the Company and STA Pharmaceutical Hong Kong Limited, a subsidiary of WuKi AppTec (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q, filed with the SEC on November 5, 2020).
−Removed: 10.38† The Company's 2021 Executive Officer Annual Bonus Plan.
21.1 List of subsidiaries of the Company.
16 unchanged sentences
The Company undertakes to furnish supplemental copies of any of the omitted schedules upon request by the SEC.
−Removed: * Certain portions of this exhibit are omitted because they are not material and would likely cause competitive harm to the Company if publicly disclosed.
+Added: * Certain portions of this exhibit are omitted pursuant to Item 601(b)(10)(iv).
FORM 10-K SUMMARY
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
−Removed: March 1, 2021 Travere Therapeutics, Inc.
+Added: February 24, 2022 Travere Therapeutics, Inc.
Chief Executive Officer
4 unchanged sentences
Dube Chief Executive Officer and Director (Principal Executive Officer)
−Removed: Dube March 1, 2021
−Removed: /s/ Laura Clague Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)
−Removed: Laura Clague March 1, 2021
+Added: Dube February 24, 2022
+Added: /s/ Laura Clague Chief Financial Officer (Principal Financial Officer)
+Added: Laura Clague February 24, 2022
+Added: /s/ Sandra Calvin Vice President, Corporate Controller and Chief Accounting Officer (Principal Accounting Officer)
+Added: Sandra Calvin February 24, 2022
/s/ Stephen Aselage Director
−Removed: Stephen Aselage March 1, 2021
+Added: Stephen Aselage February 24, 2022
Baynes Director
−Removed: Baynes March 1, 2021
+Added: Baynes February 24, 2022
/s/ Suzanne Bruhn Director
−Removed: Suzanne Bruhn March 1, 2021
+Added: Suzanne Bruhn February 24, 2022
/s/ Timothy Coughlin Director
−Removed: Timothy Coughlin March 1, 2021
+Added: Timothy Coughlin February 24, 2022
/s/ Gary Lyons Director
−Removed: Gary Lyons March 1, 2021
+Added: Gary Lyons February 24, 2022
/s/ Jeffrey A.
Meckler Director
−Removed: Meckler March 1, 2021
+Added: Meckler February 24, 2022
Orwin Director
−Removed: Orwin March 1, 2021
+Added: Orwin February 24, 2022
/s/ Sandra E.
Poole Director
−Removed: Poole March 1, 2021
+Added: Poole February 24, 2022
/s/ Ron Squarer Director
−Removed: Ron Squarer March 1, 2021
+Added: Ron Squarer February 24, 2022
+Added: /s/ Ruth Williams-Brinkley Director
+Added: Ruth Williams-Brinkley February 24, 2022
TRAVERE THERAPEUTICS, INC.
1 unchanged sentence
INDEX TO FINANCIAL STATEMENTS
−Removed: Report of Independent Registered Public Accounting Firm
+Added: Report of Independent Registered Public Accounting Firm (BDO USA, LLP, San Diego, California, PCAOB ID# 243 )
Financial Statements
10 unchanged sentences
We have audited the accompanying consolidated balance sheets of Travere Therapeutics, Inc.
−Removed: (the “Company”) and subsidiaries as of December 31, 2020 and 2019, the related consolidated statements of operations and comprehensive loss, stockholders’ equity, and cash flows for each of the three years in the period ended December 31, 2020, and the related notes (collectively referred to as the “consolidated financial statements”).
+Added: (the “Company”) as of December 31, 2021 and 2020, the related consolidated statements of operations and comprehensive loss, stockholders’ equity, and cash flows for each of the three years in the period ended December 31, 2021, and the related notes (collectively referred to as the “consolidated financial statements”).
In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2021 and 2020, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2021 , in conformity with accounting principles generally accepted in the United States of America.
−Removed: We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the Company’s internal control over financial reporting as of December 31, 2020, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) and our report dated March 1, 2021 expressed an unqualified opinion thereon.
−Removed: Change in Accounting Principle
−Removed: As discussed in Note 18 to the consolidated financial statements, the Company changed its method of accounting for leases in 2019 due to the adoption of Accounting Standards Codification Topic 842, Leases.
+Added: We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the Company's internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) and our report dated February 24, 2022 expressed an unqualified opinion thereon.
Basis for Opinion
9 unchanged sentences
We believe that our audits provide a reasonable basis for our opinion.
−Removed: Critical Audit Matter
−Removed: The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that:
−Removed: (1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.
−Removed: The communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
+Added: Critical Audit Matters
+Added: The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that:
+Added: (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.
+Added: The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.
Business Combination-Related Contingent Consideration
3 unchanged sentences
The determination of the fair value of business combination-related contingent consideration requires management to make significant judgments including the appropriateness of the valuation model selected, the reasonableness of estimates and assumptions utilized in forecasts of future net sales and the discount rates applied to such forecasts.
−Removed: Changes in these judgments could have a significant impact on the fair value of the business combination-related contingent consideration.
+Added: Changes in these judgments could have a significant impact on the fair value of the business combination-
+Added: related contingent consideration.
Auditing these elements involved especially challenging auditor judgment due to the subjectivity, nature and extent of auditor effort required to address the matter, including the extent of specialized skills and knowledge needed.
5 unchanged sentences
• Utilizing professionals with specialized skills and knowledge in valuation to assist in evaluating the appropriateness of the valuation models utilized by management and to assess the reasonableness of certain estimates and assumptions used by management to develop the discount rates applied to the net sales forecasts.
−Removed: We have served as the Company’s auditor since 2014.
+Added: License and Collaboration Agreement with Vifor
+Added: As discussed in Note 4 to the consolidated financial statements, in September 2021, the Company entered into a license and collaboration agreement with Vifor (International) Ltd.
+Added: (“Vifor Pharma”).
+Added: Under the terms of the agreement, the Company granted Vifor Pharma an exclusive license to commercialize sparsentan in Europe, Australia, and New Zealand.
+Added: In exchange for the license, the Company received an upfront payment of $55.0 million during 2021 and is eligible to receive additional regulatory and market access related milestones and sales-based milestones and royalties.
+Added: We have identified the identification of performance obligations under the Vifor license and collaboration agreement as a critical audit matter.
+Added: Determining the distinct performance obligations included in the agreement required management to make judgements with respect to the appropriate application of relevant authoritative accounting guidance.
+Added: Auditing management’s judgments and the resulting impacts on the accounting and revenue recognition for the Vifor license and collaboration agreement required increased auditor effort.
+Added: The primary procedures we performed to address this critical audit matter included:
+Added: Assessing the key terms in the license and collaboration agreement under the relevant authoritative accounting guidance to evaluate management’s conclusion that the license and collaboration agreement contains two distinct performance obligations.
+Added: Utilizing professionals with increased experience and expertise in technical accounting for license and collaboration agreements to assist in evaluation of management’s conclusions with respect to the performance obligations identified.
/s/ BDO USA, LLP
+Added: We have served as the Company’s auditor since 2014.
San Diego, California
−Removed: March 1, 2021
+Added: February 24, 2022
TRAVERE THERAPEUTICS, INC.
5 unchanged sentences
Cash and cash equivalents $ 165,753 $ 84,772
−Removed: Available-for-sale debt securities, at fair value (amortized cost $ 276,111 , allowance for credit losses of $ 0 as of December 31, 2020;
−Removed: amortized cost $ 335,206 , allowance for credit losses of $ 0 as of December 31, 2019)
−Removed: 276,817 336,088
+Added: Marketable debt securities, at fair value 387,129 276,817
Accounts receivable, net 15,914 15,925
Inventory, net 7,313 7,608
−Removed: Prepaid expenses and other current assets 8,143 5,015
Tax receivable 247 17,142
+Added: Prepaid expenses and other current assets 6,471 8,143
Total current assets 582,827 410,407
Property and equipment, net 11,106 9,418
−Removed: Other assets 33,489 14,709
+Added: Operating lease right of use assets 23,196 25,675
Intangible assets, net 148,435 154,125
−Removed: Goodwill 936 936
+Added: Other assets 11,069 7,814
Total assets $ 776,633 $ 607,439
3 unchanged sentences
Accrued expenses 75,180 56,793
−Removed: Other current liabilities 6,334 8,590
+Added: Deferred revenue, current portion 16,268 —
Business combination-related contingent consideration 7,400 17,400
+Added: Operating lease liabilities, current portion 3,908 357
+Added: Other current liabilities 6,188 5,977
Total current liabilities 124,088 92,660
Convertible debt 226,581 215,339
−Removed: Other non-current liabilities 40,527 20,894
+Added: Deferred revenue, less current portion 20,379 —
Business combination-related contingent consideration, less current portion 59,700 47,700
+Added: Operating lease liabilities, less current portion 31,497 28,336
+Added: Other non-current liabilities 12,276 12,191
Total liabilities 474,521 396,226
5 unchanged sentences
Common stock $ 0.0001 par value;
−Removed: 100,000,000 shares authorized;
+Added: 200,000,000 and 100,000,000 shares authorized;
62,491,498 and 52,248,431 issued and outstanding as of December 31, 2021 and 2020, respectively
1 unchanged sentence
Accumulated deficit ( 765,966 ) ( 585,875 )
−Removed: Accumulated other comprehensive (loss) income ( 902 ) 726
+Added: Accumulated other comprehensive loss ( 562 ) ( 902 )
Total stockholders' equity 302,112 211,213
8 unchanged sentences
Net product sales $ 210,776 $ 198,321 $ 175,338
+Added: License and collaboration revenue 16,714 — —
+Added: Total revenue 227,490 198,321 175,338
Operating expenses:
3 unchanged sentences
Change in fair value of contingent consideration 22,260 3,655 15,051
−Removed: Restructuring — — ( 242 )
Impairment of L-UDCA IPR&D intangible asset — — 25,500
5 unchanged sentences
Other Income (expense), net:
−Removed: Other income (expense), net 1,420 ( 314 ) ( 474 )
Interest income 1,993 5,003 10,055
Interest expense ( 20,141 ) ( 19,050 ) ( 18,828 )
−Removed: Loss on extinguishment of debt — — ( 17,042 )
+Added: Other income (expense), net 231 1,420 ( 314 )
Total other expense, net ( 17,917 ) ( 12,627 ) ( 9,087 )
−Removed: Loss before benefit (provision) for income taxes ( 188,790 ) ( 146,448 ) ( 101,867 )
−Removed: Income tax benefit (provision) 19,359 21 ( 811 )
+Added: Loss before (provision) benefit for income taxes ( 179,682 ) ( 188,790 ) ( 146,448 )
+Added: Income tax (provision) benefit ( 409 ) 19,359 21
Net loss $ ( 180,091 ) $ ( 169,431 ) $ ( 146,427 )
3 unchanged sentences
Net loss $ ( 180,091 ) $ ( 169,431 ) $ ( 146,427 )
−Removed: Foreign currency translation (loss) gain ( 1,452 ) 92 39
+Added: Foreign currency translation gain (loss) 1,515 ( 1,452 ) 92
Unrealized (loss) gain on debt securities ( 1,175 ) ( 176 ) 2,163
10 unchanged sentences
BALANCE - DECEMBER 31, 2018 41,389,524 $ 4 $ 589,795 $ ( 1,529 ) $ ( 270,017 ) $ 318,253
−Removed: Adoption of ASU 2017-11 - reclassification of derivative liability of warrants with down round provisions — — 5,394 — 10,316 15,710
Share based compensation — — 20,463 — — 20,463
−Removed: Exercise of warrants 1,036,054 — 5,305 — — 5,305
−Removed: Unrealized gain/(loss) on debt securities — — — ( 553 ) — ( 553 )
+Added: Unrealized gain/(loss) on marketable debt securities — — — 2,163 — 2,163
Foreign currency translation adjustments — — — 92 — 92
1 unchanged sentence
272,730 — 1,618 — — 1,618
−Removed: ESPP stock purchase and expense 87,012 — 2,269 — — 2,269
+Added: Employee stock purchase program stock purchase and expense 129,324 — 2,444 — — 2,444
Convertible debt issue 1,297,343 — 22,590 — — 22,590
2 unchanged sentences
Share based compensation — — 22,733 — — 22,733
−Removed: Unrealized gain/(loss) on debt securities — — — 2,163 — 2,163
−Removed: Foreign currency translation adjustments — — — 92 — 92
−Removed: Issuance of common shares under the equity incentive plan and proceeds from exercise.
+Added: Issuance of common stock under the equity incentive plan and proceeds from exercise 649,075 — 3,895 — — 3,895
+Added: Equity offering, net of issuance costs of $ 7.2 million
7,475,000 1 108,691 — — 108,692
−Removed: ESPP stock purchase and expense 129,324 — 2,444 — — 2,444
−Removed: Convertible debt issue 1,297,343 — 22,590 — — 22,590
+Added: Issuance of common stock under At-The-Market offering, net of offering costs 867,806 — 22,828 22,828
+Added: Unrealized gain/(loss) on marketable debt securities — — — ( 176 ) — ( 176 )
+Added: Foreign currency translation adjustments — — — ( 1,452 ) — ( 1,452 )
+Added: Employee stock purchase program stock purchase and expense 167,629 — 2,928 — — 2,928
Net loss — — — — ( 169,431 ) ( 169,431 )
2 unchanged sentences
Issuance of common stock under the equity incentive plan and proceeds from exercise 1,302,966 — 12,841 — — 12,841
−Removed: Issuance of common stock under equity offering and proceeds 7,475,000 1 108,691 — — 108,692
−Removed: Issuance of common stock under At-The-Market offering and proceeds 867,806 — 22,828 22,828
−Removed: Unrealized gain/(loss) on debt securities — — — ( 176 ) — ( 176 )
+Added: Equity offering, net of issuance costs of $ 12.2 million
+Added: 7,532,500 1 189,278 — — 189,279
+Added: Issuance of common stock under At-The-Market offering, net of offering costs 1,240,640 — 35,656 — — 35,656
+Added: Unrealized gain/(loss) on marketable debt securities — — — ( 1,175 ) — ( 1,175 )
Foreign currency translation adjustments — — — 1,515 — 1,515
−Removed: ESPP stock purchase and expense 167,629 — 2,928 — — 2,928
+Added: Employee stock purchase program stock purchase and expense 166,961 — 3,012 — — 3,012
Net loss — — — — ( 180,091 ) ( 180,091 )
9 unchanged sentences
Net loss $ ( 180,091 ) $ ( 169,431 ) $ ( 146,427 )
−Removed: Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
+Added: Adjustments to reconcile net loss to net cash used in operating activities:
Share based compensation 30,766 23,614 21,105
−Removed: Other operating activities 851 ( 51 ) ( 396 )
−Removed: Loss on impairment of long-term investment — 15,000 —
−Removed: Loss on extinguishment of debt — — 17,042
−Removed: Loss on allowance for inventory 2,225 1,468 2,457
−Removed: Lease expense 1,209 56 456
−Removed: Impairment of intangible assets — 25,500 —
−Removed: Foreign currency transaction (gain) loss ( 934 ) 112 464
−Removed: Acquired IPR&D expense 97,131 — —
Depreciation and amortization 26,617 24,579 20,408
2 unchanged sentences
Amortization of debt discount and deferred financing costs 11,242 10,478 9,903
+Added: Loss on allowance for inventory 2,110 2,225 1,468
Amortization of premiums (discounts) on investments 2,008 703 ( 788 )
−Removed: Accretion of contingent consideration 1,626 1,485 1,357
+Added: Acquired IPR&D expense — 97,131 —
+Added: Impairment of intangible assets — — 25,500
+Added: Loss on impairment of long-term investment — — 15,000
+Added: Other 4,692 2,752 1,602
Changes in operating assets and liabilities, net of asset acquisition:
6 unchanged sentences
Accrued expenses and other current liabilities 19,545 4,023 4,602
−Removed: Net cash provided by (used in) operating activities ( 42,743 ) ( 58,214 ) ( 24,958 )
+Added: Deferred revenue, current and non-current 38,300 — —
+Added: Net cash used in operating activities ( 14,792 ) ( 42,743 ) ( 58,214 )
Cash Flows from Investing Activities:
1 unchanged sentence
Purchase of intangible assets ( 19,050 ) ( 17,799 ) ( 15,370 )
−Removed: Investment - Equity — — ( 15,000 )
−Removed: Proceeds from the sale/maturity of debt securities 273,482 259,140 162,755
−Removed: Purchase of marketable securities ( 214,964 ) ( 223,712 ) ( 331,345 )
+Added: Proceeds from the sale/maturity of marketable debt securities 433,604 273,482 259,140
+Added: Purchase of marketable debt securities ( 547,076 ) ( 214,964 ) ( 223,712 )
Purchased IPR&D, net of cash acquired — ( 95,279 ) —
−Removed: Net cash provided by (used in) investing activities ( 61,327 ) 19,863 ( 203,291 )
+Added: Net cash (used in) provided by investing activities ( 137,623 ) ( 61,327 ) 19,863
Cash Flows from Financing Activities:
Payment of acquisition-related contingent consideration ( 6,104 ) ( 7,648 ) ( 3,388 )
−Removed: Payment of other liability — — ( 1,000 )
Payment of guaranteed minimum royalty ( 2,100 ) ( 2,100 ) ( 2,084 )
−Removed: Proceeds from exercise of warrants — — 5,305
Proceeds from exercise of stock options 12,841 3,895 1,618
Proceeds from the issuance of common stock in At-the-Market equity offering 35,656 22,828 —
−Removed: Proceeds from the issuance of common stock in underwritten public offering 108,692 — —
−Removed: Proceeds from issuance of 2025 convertible senior notes — — 276,000
−Removed: Repurchase of 2019 convertible senior notes including premium — — ( 40,203 )
−Removed: Payment of debt issuance and financing costs — — ( 8,820 )
+Added: Proceeds from the issuance of common stock, net of issuance costs 189,278 108,692 —
Proceeds from the issuance of common stock under the employee stock purchase program 2,112 2,046 1,777
8 unchanged sentences
Non-cash Investing and financing activities:
−Removed: Accrued Capital Expenditure $ 1,856 $ — $ —
Accrued royalty in excess of minimum payable to the sellers of Thiola $ 19,362 $ 18,168 $ 15,815
−Removed: Term extension of current Thiola agreement $ — $ — $ —
−Removed: Adoption of ASU 2017-11 - reclassification of derivative liability of warrants with down round provisions $ — $ — $ 15,710
The accompanying notes are an integral part of these consolidated financial statements.
6 unchanged sentences
(“we”, “our”, “us”, “Travere” and the “Company”) refers to Travere Therapeutics, Inc., a Delaware corporation, as well as our direct and indirect subsidiaries.
−Removed: In November 2020, we changed our name to Travere Therapeutics, Inc.
−Removed: from Retrophin, Inc.
Travere is a fully integrated biopharmaceutical company headquartered in San Diego, California focused on identifying, developing and delivering life-changing therapies to people with rare diseases.
1 unchanged sentence
The ongoing novel coronavirus (COVID-19) pandemic has resulted in travel restrictions, quarantines, “stay-at-home” and “shelter-in-place” orders and extended shutdown of certain businesses around the world.
−Removed: While the impact of the COVID-19 pandemic did not have a material adverse effect on our financial position or results of operations for the twelve months ended December 31, 2020, these governmental actions and the widespread economic disruption arising from the pandemic have the potential to materially impact our business and influence our business decisions.
+Added: While the impact of the COVID-19 pandemic did not have a material adverse effect on our financial position or results of operations for the twelve months ended December 31, 2021, these governmental actions and similar actions that may be enacted in the future, and the widespread economic disruption arising from the pandemic, have the potential to materially impact our business and influence our business decisions.
The extent and duration of the pandemic is unknown, and the future effects on our business are uncertain and difficult to predict.
1 unchanged sentence
Clinical Programs:
−Removed: Sparsentan, also known as RE-021, is an investigational product candidate with a dual mechanism of action, a selective endothelin receptor antagonist (“ERA”), with in vitro selectivity toward endothelin receptor type A, and a potent angiotensin receptor blocker (“ARB”).
−Removed: Sparsentan is currently being evaluated in two pivotal Phase 3 clinical studies in the following indications:
−Removed: • Focal segmental glomerulosclerosis ("FSGS") is a rare kidney disease characterized by proteinuria where the glomeruli become progressively scarred.
−Removed: FSGS is a leading cause of end-stage renal disease.
−Removed: • Immunoglobulin A nephropathy ("IgAN") is an immune-complex-mediated glomerulonephritis characterized by hematuria, proteinuria, and variable rates of progressive renal failure.
−Removed: IgAN is the most common primary glomerular disease.
−Removed: TVT-058 ( previously OT-58) is a novel investigational human enzyme replacement candidate being evaluated for the treatment of classical homocystinuria (HCU).
−Removed: Classical HCU is a rare metabolic disorder characterized by elevated levels of plasma homocysteine that can lead to vision, skeletal, circulatory and central nervous system issues.
−Removed: TVT-058 is currently being tested in a Phase 1/2 double blind, randomized, placebo-controlled dose escalation study to assess its safety, tolerability, pharmacokinetics, pharmacodynamics and clinical effects in patients with classical HCU.
−Removed: TVT-058 has been granted Rare Pediatric Disease and Fast Track designations by the FDA, as well as orphan drug designation in the United States and Europe.
−Removed: We acquired TVT-058 as part of the November 2020 acquisition of Orphan Technologies Limited.
+Added: Sparsentan is a novel investigational product candidate and has been granted Orphan Drug Designation for the treatment of focal segmental glomerulosclerois (FSGS) and immunoglobulin A nephropathy (IgAN) in the U.S.
+Added: Sparsentan is currently being evaluated in two pivotal Phase 3 clinical studies in rare kidney diseases.
+Added: Pegtibatinase ( TVT-058) is a novel investigational human enzyme replacement candidate being evaluated for the treatment of classical homocystinuria (HCU).
+Added: Pegtibatinase has been granted Rare Pediatric Disease and Fast Track designations by the FDA, as well as orphan drug designation in the United States and European Union.
+Added: Pegtibatinase is currently being evaluated in the Phase 1/2 COMPOSE Study to assess its safety, tolerability, pharmacokinetics, pharmacodynamics and clinical effects in patients with classical HCU.
+Added: The Company acquired pegtibatinase as part of the November 2020 acquisition of Orphan Technologies Limited.
Chenodal (chenodeoxycholic acid or CDCA) is a naturally occurring bile acid that is approved for the treatment of people with radiolucent stones in the gallbladder.
−Removed: CTX is a rare, progressive and underdiagnosed bile acid synthesis disorder affecting many parts of the body.
−Removed: In January 2020, we randomized the first patients in our Phase 3 RESTORE Study to evaluate the effects of Chenodal in adult and pediatric patients with CTX, and the study continues to enroll.
+Added: In January 2020, we randomized the first patients in our Phase 3 RESTORE Study to evaluate the effects of Chenodal in adult and pediatric patients with cerebrotendinous xanthomatosis (CTX), and the study enrollment remains open.
The pivotal study is intended to support an NDA submission for marketing authorization of Chenodal for CTX in the United States.
Preclinical Programs:
−Removed: The Company is a participant in two Cooperative Research and Development Agreements ("CRADAs"), which form a multi-stakeholder approach to pool resources with leading experts, and incorporate the patient perspective early in the therapeutic identification and development process.
−Removed: We have partnered with the National Institutes of Health’s National Center for Advancing Translational Sciences ("NCATS") and leading patient advocacy organizations, CDG Care and Alagille Syndrome Alliance, aimed at the identification of potential small molecule therapeutics for NGLY1 deficiency and Alagille syndrome, respectively.
+Added: We are a participant in two Cooperative Research and Development Agreements ("CRADAs"), which form a multi-stakeholder approach to pool resources with leading experts, and incorporate the patient perspective early in the therapeutic identification and development process.
+Added: We have partnered with the National Institutes of Health’s National Center for Advancing Translational Sciences ("NCATS") and leading patient advocacy organizations, CDG Care and Alagille Syndrome Alliance, aimed at the identification of potential small molecule therapeutics for NGLY1 deficiency and Alagille syndrome ("ALGS"), respectively.
There are no treatment options currently approved for these diseases.
3 unchanged sentences
• Thiola ® and Thiola EC ® (tiopronin tablets) are approved in the United States for the prevention of cystine (kidney) stone formation in patients with severe homozygous cystinuria.
−Removed: Changes in Development Activities:
−Removed: In November 2020, the Company completed the acquisition of Orphan Technologies Limited (“Orphan”), which included Orphan’s rare metabolic disorder drug OT-58.
−Removed: The Company acquired Orphan by purchasing all of the outstanding shares (see Note 5).
−Removed: The Company plans to continue the development of OT-58, which is currently being evaluated in Phase 1/2 development for the treatment of classical homocystinuria ("HCU"), under the name TVT-058.
−Removed: In January 2020, the Company randomized the first patients in the Phase 3 RESTORE Study to evaluate the effects of Chenodal in adult and pediatric patients with CTX.
−Removed: In August 2019, the Company announced that the Phase 3 FORT Study evaluating the safety and efficacy of fosmetpantotenate compared to placebo in patients with pantothenate kinase-associated neurodegeneration ("PKAN") did not meet its primary endpoint and did not demonstrate a difference between treatment groups.
−Removed: The study also did not meet its secondary endpoint.
−Removed: The Company will not proceed with further development of fosmetpantotenate for PKAN.
−Removed: In August 2019, following a strategic review of the CNSA-001 program in patients with phenylketonuria ("PKU"), the Company made the decision to decline to exercise its option to acquire Censa Pharmaceuticals and accordingly discontinue its joint development program for CNSA-001.
−Removed: The Company impaired the related $ 15 million long-term investment during the third quarter of 2019.
−Removed: During the first quarter of 2019, the Company elected to discontinue development of the liquid ursodeoxycholic acid ("L-UDCA") program, resulting in impairment of the intangible asset of $ 25.5 million, originally recorded in 2016, and the related $ 18.0 million in contingent liability.
−Removed: This resulted in a net $ 7.5 million non-cash charge to operations in 2019.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
8 unchanged sentences
On an ongoing basis, the Company evaluates its estimates and assumptions.
−Removed: These estimates and assumptions include revenue recognition, valuing equity securities in share-based payments, estimating expenses of contracted research organizations, estimating the useful lives of depreciable and amortizable assets, goodwill impairment, estimating the fair value of contingent consideration, estimating of valuation allowances and uncertain tax positions, and estimates associated with the assessment of impairment for long-lived assets.
+Added: These estimates and assumptions include revenue recognition, forecasting probability-weighted cash flows based upon estimates of forecasted revenues, clinical and regulatory timelines and discount rates, valuing equity securities in share-based payments, estimating expenses of contracted research organizations, estimating the useful lives of depreciable and amortizable assets, goodwill impairment, estimating the fair value of contingent consideration, estimating of valuation allowances and uncertain tax positions, and estimates associated with the assessment of impairment for long-lived assets.
Revenue Recognition
−Removed: Effective January 1, 2018, the Company adopted Accounting Standards Codification ("ASC"), Topic 606, Revenue from Contracts with Customers, using the full retrospective transition method.
−Removed: This standard applies to all contracts with customers, except for contracts that are within the scope of other standards, such as leases, insurance, collaboration arrangements and financial instruments.
−Removed: Under Topic 606, an entity recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services.
−Removed: To determine revenue recognition for arrangements that an entity determines are within the scope of Topic 606, the entity performs the following five steps:
+Added: The Company recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services.
+Added: To determine revenue recognition for arrangements that an entity determines are within the scope of Accounting Standards Codification ("ASC") 606, Revenue from Contracts with Customers ("ASC 606"), the entity performs the following five steps:
(i) identify the contract(s) with a customer;
(ii) identify the performance obligations in the contract;
−Removed: determine the transaction price;
+Added: (iii) determine the transaction price;
(iv) allocate the transaction price to the performance obligations in the contract;
1 unchanged sentence
The Company only applies the five-step model to contracts when it is probable that the entity will collect substantially all the consideration it is entitled to in exchange for the goods or services it transfers to the customer.
−Removed: Revenue from product sales is recorded at delivery, net of applicable provisions for rebates under government (including medicaid) programs, commercial rebates, prompt pay discounts, and other sales-related deductions.
−Removed: We review our estimates of rebates and other applicable provisions each period and record any necessary adjustments in the current period.
−Removed: See Note 3 for further discussion.
+Added: See Note 3 and Note 4 for further discussion.
+Added: Payments received under collaboration and licensing agreements may include non-refundable fees at the inception of the arrangements, milestone payments for specific achievements and royalties on the sale of products.
+Added: At the inception of arrangements that include milestone payments, the Company uses judgement to evaluate whether the milestones are probable of being achieved and estimates the amount to include in the transaction price utilizing the most likely amount method.
+Added: If it is probable that a significant revenue reversal will not occur, the estimated amount is included in the transaction price.
+Added: Milestone payments that are not within the Company or the licensee’s control, such as regulatory approvals are not included in the transaction price until those approvals are received.
+Added: At the end of each reporting period, the Company re-evaluates the probability of achievement of development milestones and any related constraint and adjusts the estimate of the overall transaction price, if necessary.
+Added: The Company recognizes aggregate sales-based milestones and royalty payments from product sales at the later of when the related sales occur or when the performance obligation to which the sales-based milestone or royalty has been allocated has been satisfied.
+Added: If it is probable that a significant revenue reversal will not occur, the Company estimates the sales-based milestone and royalty payments using the most likely amount method.
+Added: The Company utilizes significant judgement to develop estimates of the stand-alone selling price for each distinct performance obligation based upon the relative stand-alone selling price.
+Added: Variable consideration that relates specifically to the Company’s efforts to satisfy specific performance obligations is allocated entirely to those performance obligations.
+Added: The stand-alone selling price for license-related performance obligations requires judgement in developing assumptions to project probability-weighted cash flows based upon estimates of forecasted revenues, clinical and regulatory timelines and discount rates.
+Added: The stand-alone selling price for clinical development performance obligations is based on forecasted expected costs of satisfying a performance obligation plus an appropriate margin.
+Added: If the licenses to intellectual property are determined to be distinct from the other performance obligations identified in the arrangement and have stand-alone functionality, the Company recognizes revenues from non-refundable, upfront fees allocated to the license when the license is transferred to the licensee and the licensee is able to benefit from the license.
+Added: For licenses that are not distinct from other promises, the Company applies judgment to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue from non-refundable, upfront fees.
+Added: The Company evaluates the measure of progress each reporting period and, if necessary, adjusts the related revenue recognition accordingly.
+Added: The selection of the method to measure progress towards completion requires judgment and is based on the nature of the products or services to be provided.
+Added: Revenue is recorded proportionally as costs are incurred.
+Added: The Company generally utilizes the cost-to-cost method of progress because it
+Added: best measures the transfer of control to the customer which occurs as the Company incurs costs.
+Added: Under the cost-to-cost measure of progress, the extent of progress towards completion is measured based on the ratio of costs incurred to date to the total estimated costs at completion of the performance obligation.
+Added: The Company uses judgment to estimate the total costs expected to complete the clinical development performance obligations, which include subcontractor costs, labor, materials, other direct costs and an allocation of indirect costs.
+Added: The Company evaluates these cost estimates and the progress each reporting period and adjusts the measure of progress, if necessary.
Research and Development Costs
−Removed: Research and development includes expenses related to sparsentan, fosmetpantotenate, TVT-058, and our other pipeline programs.
−Removed: We expense all research and development costs as they are incurred.
−Removed: Our research and development costs are comprised of salaries and bonuses, benefits, share-based compensation, license fees, milestones under license agreements, costs paid to third-party contractors to perform research, conduct clinical trials, and develop drug materials and delivery devices, and associated overhead expenses and facilities costs.
−Removed: We charge direct internal and external program costs to the respective development programs.
−Removed: We also incur indirect costs that are not allocated to specific programs because such costs benefit multiple development programs and allow us to increase our pharmaceutical development capabilities.
+Added: Research and development includes expenses related to sparsentan, pegtibatinase, and the Company's other pipeline programs.
+Added: The Company expenses all research and development costs as they are incurred.
+Added: The Company's research and development costs are comprised of salaries and bonuses, benefits, share-based compensation, license fees, milestones under license agreements, costs paid to third-party contractors to perform research, conduct clinical trials, and develop drug materials and delivery devices, and associated overhead expenses and facilities costs.
+Added: The Company charges direct internal and external program costs to the respective development programs.
+Added: The Company also incurs indirect costs that are not allocated to specific programs because such costs benefit multiple development programs and allow us to increase our pharmaceutical development capabilities.
These consist of internal shared resources related to the development and maintenance of systems and processes applicable to all of our programs.
Clinical Trial Expenses
−Removed: We record expenses in connection with our clinical trials under contracts with contract research organizations (CROs) that support conducting and managing clinical trials.
+Added: The Company records expenses in connection with clinical trials under contracts with contract research organizations (CROs) that support conducting and managing clinical trials.
The financial terms and activities of these agreements vary from contract to contract and may result in uneven expense levels.
2 unchanged sentences
Other incidental costs related to patient enrollment or treatment are accrued when reasonably certain.
−Removed: If the amounts we are obligated to pay under our clinical trial agreements are modified (for instance, as a result of changes in the clinical trial protocol or scope of work to be performed), we adjust our accruals accordingly on a prospective basis.
−Removed: Revisions to our contractual payment obligations are charged to expense in the period in which the facts that give rise to the revision become reasonably certain.
−Removed: We currently have three Phase 3 clinical trials in process that are in varying stages of activity, with ongoing non-clinical support trials.
+Added: If the amounts we are obligated to pay under our clinical trial agreements are modified (for instance, as a result of changes in the clinical trial protocol or scope of work to be performed), the Company adjusts its accruals accordingly on a prospective basis.
+Added: Revisions to the Company's contractual payment obligations are charged to expense in the period in which the facts that give rise to the revision become reasonably certain.
+Added: The Company currently has three Phase 3 clinical trials in process that are in varying stages of activity, with ongoing non-clinical support trials.
As such, clinical trial expenses will vary depending on the all the factors set forth above and may fluctuate significantly from quarter to quarter.
8 unchanged sentences
Forfeitures are accounted for as they occur.
−Removed: Stock Options 3 to 4 years
+Added: Expiration Term Vesting Term
+Added: Stock Options 10 years 3 to 4 years
Restricted Stock Units ---- 1 to 4 years
Earnings (Loss) Per Share
−Removed: We calculate our basic earnings per share by dividing net income/(loss) by the weighted average number of shares outstanding during the period.
+Added: The Company calculates basic earnings per share by dividing net income/(loss) by the weighted average number of shares outstanding during the period.
The diluted earnings/(loss) per share computation includes the effect, if any, of shares that would be issuable upon the exercise of outstanding stock options, derivative warrant liability, convertible debt and RSUs, reduced by the number of shares which are assumed to be purchased by the Company from the resulting proceeds at the average market price during the year, when such amounts are dilutive to the earnings per share calculation.
Cash and Cash Equivalents
−Removed: We consider all highly liquid marketable securities with an original maturity of three months or less to be cash equivalents.
+Added: The Company considers all highly liquid marketable securities with an original maturity of three months or less to be cash equivalents.
Due to the short-term maturity of such investments, the carrying amounts are a reasonable estimate of fair value.
+Added: Concentration of Credit Risk
The Company maintains its cash and cash equivalents at insured financial institutions, the balances of which may, at times, exceed federally insured limits.
Generally, these deposits may be redeemed upon demand, and the Company believes there is minimal risk of losses on such balances.
−Removed: Debt Securities
−Removed: The Company accounts for debt securities held as “available-for-sale” in accordance with ASC 320, “Investments - Debt Securities” (“ASC 320”).
+Added: The Company monitors its investments with counterparties with the objective of minimizing concentrations of credit risk.
+Added: The Company's investment policy is to invest only in institutions that meet high credit quality standards and established limits on the amount and time to maturity of investments with any individual counterparty.
+Added: The policy also requires that investments are only entered into with corporate and financial institutions that meet high quality standards.
+Added: Marketable Debt Securities
+Added: The Company accounts for marketable debt securities held as “available-for-sale” in accordance with ASC 320, “Investments - Debt Securities” (“ASC 320”).
The Company classifies these investments as current assets and carries them at fair value.
−Removed: Unrealized gains and losses on debt securities are recorded as a separate component of stockholders’ equity as accumulated other comprehensive loss, unless an impairment is determined to be the result of credit-related factors or the Company intends to sell the security or it is more likely than not that the Company will be required to sell the security before recovery.
+Added: Unrealized gains and losses on marketable debt securities are recorded as a separate component of stockholders’ equity as accumulated other comprehensive loss, unless an impairment is determined to be the result of credit-related factors or the Company intends to sell the security or it is more likely than not that the Company will be required to sell the security before recovery.
Realized gains or losses on debt security transactions and declines in value that are determined to be the result of credit losses, if any, are reported in the Consolidated Statements of Operations and Comprehensive Loss.
−Removed: Debt securities are maintained at one financial institution and are governed by the Company’s investment policy.
+Added: Marketable debt securities are maintained at one financial institution and are governed by the Company’s investment policy.
See Note 6 for further discussion.
Trade Receivables, Net
−Removed: Trade accounts receivable are recorded net of allowances for prompt payment and doubtful accounts.
−Removed: Estimates for allowances for doubtful accounts are determined based on existing contractual obligations, historical payment patterns and individual customer circumstances.
−Removed: The allowance for doubtful accounts was zero at both December 31, 2020 and 2019, respectively.
−Removed: For the years ended December 31, 2020, 2019 and 2018, bad debt expense recorded in the Statement of Operations and Comprehensive Loss was approximately $ 0.1 million, $ 0.1 million and zero , respectively.
−Removed: Expected credit losses on our trade receivables are estimated to be immaterial.
+Added: Trade accounts receivable are recorded net of reserves for prompt pay discounts and expected credit losses.
+Added: Estimates for allowances for credit losses are determined based on existing contractual obligations, historical payment patterns and individual customer circumstances.
+Added: The allowance for credit losses was zero at both December 31, 2021 and 2020, respectively.
+Added: For the years ended December 31, 2021, 2020 and 2019, bad debt expense recorded in the Consolidated Statements of Operations and Comprehensive Loss was immaterial.
+Added: The Company's evaluation and application of ASU No.
+Added: 2016-13, Financial Instruments - Credit Losses for the current period included an assessment of our aged trade receivables balances and their underlying credit risk characteristics.
+Added: Our evaluation of past events, current conditions, and reasonable and supportable forecasts about the future resulted in an expectation of immaterial credit losses.
Inventory, Related Reserves and Cost of Goods Sold
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A single management team reports to the chief operating decision maker who comprehensively manages the entire business.
−Removed: The Company does not operate any separate lines of business or separate business entities with respect to its products.
+Added: Company does not operate any separate lines of business or separate business entities with respect to its products.
Accordingly, the Company does not accumulate discrete financial information with respect to separate products, other than revenues, and does not have separately reportable segments.
4 unchanged sentences
Property and equipment purchased for specific research and development projects with no alternative use is expensed as incurred.
−Removed: The major classifications of property and equipment, including their respective expected useful lives, consists of the following:
+Added: The major classifications of property and equipment, including their respective expected useful lives, consist of the following:
Computers and equipment 3 years
1 unchanged sentence
Leasehold improvements Shorter of length of lease or life of the asset
+Added: The Company determines whether a contract is, or contains, a lease at inception.
+Added: The Company classifies each of its leases as operating or financing considering factors such as the length of the lease term, the present value of the lease payments, the nature of the asset being leased, and the potential for ownership of the asset to transfer during the lease term.
+Added: Leases with terms greater than one year are recognized on the Consolidated Balance Sheets as Right-of-use assets and Lease liabilities and are measured at the present value of the fixed payments due over the expected lease term minus the present value of any incentives, rebates or abatements expected to be received from the lessor.
+Added: Options to extend a lease are typically excluded from the expected lease term as the exercise of the option is typically not reasonably certain.
+Added: The interest rate implicit in lease contracts is typically not readily determinable.
+Added: As such, the Company utilizes the appropriate incremental borrowing rate, which is the rate incurred to borrow on a collateralized basis an amount equal to the lease payments over a similar term and in a similar economic environment.
+Added: The Company records expense to recognize fixed lease payments on a straight-line basis over the expected lease term.
+Added: Costs determined to be variable and not based on an index or rate are not included in the measurement of the lease liability and are expensed as incurred.
Intangible Assets, Net
−Removed: Our intangible assets consist of licenses and purchased technology.
+Added: The Company's intangible assets consist of licenses and purchased technology.
Intangible assets with definite lives are amortized on a straight-line basis over their estimated useful lives and are reviewed periodically for impairment.
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If and when development is complete, which generally occurs when regulatory approval to market a product is obtained, the associated assets are deemed finite-lived and are amortized over a period that best reflects the economic benefits provided by these assets.
−Removed: Acquired IPR&D
−Removed: We assess whether IPR&D assets acquired from others in an asset acquisition have alternative future use (in research and development projects or otherwise) at the acquisition date.
−Removed: If such assets have alternative future use, they are capitalized and recognized as an intangible asset.
−Removed: If such assets do not have alternative use, nor is there an alternative indication that the Company plans to pursue, the upfront consideration transferred, including any contingent consideration that is probable and reasonably estimable, is charged to expense at the acquisition date.
+Added: Intangible Assets with Cost Accumulation Model
+Added: In 2014, the Company entered into a license agreement with Mission Pharmacal in which the Company obtained the exclusive right to license the trademark of Thiola.
+Added: The acquisition of the Thiola license qualified as an asset acquisition under the principles of ASC 805, Business Combinations ("ASC 805") in effect at the time of acquisition.
+Added: The license agreement requires the Company to make royalty payments based on net sales of Thiola.
+Added: The liability for royalties in excess of the annual contractual minimum is recognized in the period in which the royalties become probable and estimable, which is typically in the period corresponding with the respective sales.
+Added: The Company records an offsetting increase to the cost basis of the asset under the cost accumulation model.
+Added: The additional cost basis is subsequently amortized over the remaining life of the license agreement.
+Added: Consistent with all prior periods since Thiola was acquired, the Company has not accrued any liability for royalties in excess of the annual contractual minimum at December 31, 2021 as such royalties are not yet probable and estimable.
Goodwill represents the excess of purchase price over fair value of net assets acquired in a business combination and is not amortized.
3 unchanged sentences
Impairment of Long-Lived Assets
−Removed: Our long-lived assets are primarily comprised of intangible assets, right-of-use assets, and property and equipment.
−Removed: We evaluate our finite-lived intangible assets, right-of-use assets, and property and equipment for impairment whenever events or changes in circumstances indicate the carrying value of an asset or group of assets may not be recoverable.
+Added: The Company's long-lived assets are primarily comprised of intangible assets, right-of-use assets, and property and equipment.
+Added: The Company evaluates its finite-lived intangible assets, right-of-use assets, and property and equipment for impairment whenever events or changes in circumstances indicate the carrying value of an asset or group of assets may not be recoverable.
If these circumstances exist, recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset group to future undiscounted net cash flows expected to be generated by the use and eventual disposition of the asset group.
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the amount and timing of projected future cash flows (including revenue, cost of sales, research and development costs, and sales and marketing expenses), and the discount rate selected to measure the risks inherent in the future cash flows.
−Removed: During the first quarter of 2019, the Company elected to discontinue development of the L-UDCA program, resulting in the write off of the IPR&D intangible asset, see Note 5 for further discussion.
There were no impairments related to finite-lived intangible assets in the years ended December 31, 2021, 2020 and 2019.
Contingent Consideration
−Removed: We record contingent consideration resulting from a business combination at its fair value on the acquisition date.
−Removed: On a quarterly basis, we revalue these obligations and record increases or decreases from their fair value as an adjustment to the consolidated statement of operations.
−Removed: contingent consideration obligations can result from changes to discount rates, accretion of the liability due to the passage of time, changes in revenue forecasts and changes in our estimates of the likelihood or timing of achieving commercial revenue milestones.
+Added: The Company records contingent consideration resulting from a business combination at its fair value on the acquisition date.
+Added: On a quarterly basis, the Company revalues these obligations and record increases or decreases from their fair value as an adjustment to the consolidated statement of operations.
+Added: Changes to contingent consideration obligations can result from changes to discount rates, accretion of the liability due to the passage of time, changes in revenue forecasts and changes in our estimates of the likelihood or timing of achieving commercial revenue milestones.
The Company follows ASC 740, Income Taxes, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns.
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Foreign currency transactions in each entity comprising the Company are remeasured into the functional currency of the entity using the exchange rates prevailing at the respective transaction dates.
−Removed: Foreign exchange gains and losses resulting from the settlement of such transactions and from the remeasurement at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognized within Other operating expense, net except for changes related to the liability related to the sale of future royalties which are recorded in Other non-operating (income) expense, net in the Consolidated Statements of Operations.
+Added: Foreign exchange gains and losses resulting from the settlement of such transactions and from the remeasurement at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognized within Other operating expense, net except for changes related to the liability related to the sale of future royalties which are recorded in Other non-operating (income) expense, net in the Consolidated Statements of Operations and Comprehensive Loss.
The results and financial position of the Company that have a functional currency different from the US dollar are translated as follows:
2 unchanged sentences
significant transactions use the exchange rate on the date of the transaction;
−Removed: All resulting exchange differences arising from such translations are recognized directly in other comprehensive income (loss) and presented as a separate component of equity.
+Added: All resulting exchange differences arising from such translations are recognized directly in comprehensive income and presented as a separate component of equity.
Reclassifications
−Removed: Certain reclassifications have been made to the prior year financial statements in order to conform to the current year’s presentation.
+Added: Certain reclassifications have been made to the prior year financial statements in order to conform to the current year’s presentation, including reclassifying operating lease right of use assets and operating lease liabilities from other assets and other liabilities, respectively on the Consolidated Balance Sheets.
+Added: These reclassifications did not have an impact on total assets or total liabilities of the Consolidated Balance Sheets.
The Company expenses external costs, such as filing fees and associated attorney fees, incurred to obtain issued patents and patent applications pending.
4 unchanged sentences
See Note 11 for further discussion.
−Removed: Recently Adopted Accounting Pronouncements
−Removed: In June 2016, the FASB issued ASU No.
−Removed: 2016-13, Financial Instruments - Credit Losses (Topic 326):
−Removed: Measurement of Credit Losses on Financial Instruments.
−Removed: Topic 326 amends guidance on reporting credit losses for assets held at amortized cost basis and available-for-sale debt securities.
−Removed: For assets held at amortized cost basis, Topic 326 eliminates the probable initial recognition threshold in current GAAP and, instead, requires an entity to reflect its current estimate of all expected credit losses.
−Removed: The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial assets to present the net amount expected to be collected.
−Removed: For available-for-sale debt securities, credit losses should be measured in a manner similar to current GAAP, however Topic 326 will require that credit losses be presented as an allowance rather than as a write-down.
−Removed: This ASU update affects entities holding financial assets and net investment in leases that are not accounted for at fair value through net income.
−Removed: The amendments affect loans, debt securities, trade receivables, net investments in leases, off balance sheet credit exposures, reinsurance receivables, and any other financial assets not excluded from the scope that have the contractual right to receive cash.
−Removed: This update is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years.
−Removed: The Company's adoption of this standard on January 1, 2020 has had an immaterial impact on our condensed consolidated financial statements, and there was no recorded impact to our opening accumulated deficit balance for the cumulative-effect adjustment.
−Removed: As of December 31, 2020, the Company held $ 15.9 million in trade receivables and $ 276.8 million in available-for-sale debt securities.
−Removed: Expected credit losses on our trade receivables are estimated to be immaterial and the Company has zero recorded allowances for expected credit losses on the available-for-sale debt securities held as of December 31, 2020.
−Removed: See Note 6 for further discussion.
Recently Issued Accounting Pronouncements
−Removed: From time to time, new accounting pronouncements are issued by the FASB or other standard setting bodies.
+Added: From time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board ("FASB") or other standard setting bodies.
Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on its consolidated financial position or results of operations upon adoption.
4 unchanged sentences
The ASU is effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years.
−Removed: The Company's assessment of the impact of the new standard on the Company's financial statements is ongoing.
+Added: The new standard will impact the Company's accounting for its Convertible Senior Notes Due 2025 (2025 Notes), discussed in Note 7, which are currently accounted for using the cash conversion model applied under ASC 470-20, Debt with Conversion and Other Options ("ASC 470-20").
+Added: Under the new guidance, the Company intends to apply the modified retrospective method as the transition approach at adoption, which will result in adjustments to the January 1, 2022 opening balances of convertible debt, additional paid-in capital, and accumulated deficit.
+Added: Additionally, from January 1, 2022, the Company will no longer incur non-cash interest expense for the amortization of debt discount resulting in lower interest expense for the 2025 Notes.
REVENUE RECOGNITION
−Removed: Product Revenue, Net
+Added: Product Sales, Net
Product sales consist of Bile Acid products (Chenodal and Cholbam) and Tiopronin products (Thiola and Thiola EC).
−Removed: The Company sells its products through direct-to-patient distributors worldwide, with more than 99 % of the revenue generated in North America.
+Added: The Company sells its products through direct-to-patient distributors worldwide, with the United States and Canada representing 98 % and 2 % of net product sales, respectively, based on the product shipment destination.
Revenues from product sales are recognized when the customer obtains control of the Company’s product, which occurs upon delivery to the customer.
1 unchanged sentence
Deductions from Revenue
−Removed: Revenues from product sales are recorded at the net sales price, which includes provisions resulting from discounts, rebates and co-pay assistance that are offered to its customers, health care providers, payors and other indirect customers relating to the Company’s sales of its products.
−Removed: These provisions are based on the amounts earned or to be claimed on the related sales and are classified as a reduction of accounts receivable (if the amount is payable to the customer) or as a current liability (if the amount is payable to a party other than a customer).
+Added: Revenues from product sales are recorded at the net sales price, which includes provisions resulting from discounts, rebates and co-pay assistance that are offered to its customers, health care providers, payers and other indirect customers relating to the Company’s sales of its products.
+Added: provisions are based on the amounts earned or to be claimed on the related sales and are classified as a reduction of accounts receivable (if the amount is payable to the customer) or as a current liability (if the amount is payable to a party other than a customer).
Where appropriate, these reserves take into consideration the Company’s historical experience, current contractual and statutory requirements and specific known market events and trends.
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Commercial Rebates:
−Removed: We calculate the rebates that we incur due to contracts with certain commercial payors and deduct these amounts from our gross product sales at the time the revenues are recognized.
−Removed: Allowances for commercial rebates are established based on actual payer information,
−Removed: which is reasonably estimated at the time of delivery.
+Added: We calculate the rebates that we incur due to contracts with certain commercial payers and deduct these amounts from our gross product sales at the time the revenues are recognized.
+Added: Allowances for commercial rebates are established based on actual payer information, which is reasonably estimated at the time of delivery.
Rebate discounts are included in accrued expenses in the accompanying Consolidated Balance Sheets.
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Co-pay Assistance:
−Removed: We offer a co-pay assistance program, which is intended to provide financial assistance to qualified commercially insured patients with prescription drug co-payments required by payors.
+Added: We offer a co-pay assistance program, which is intended to provide financial assistance to qualified commercially insured patients with prescription drug co-payments required by payers.
The calculation of the accrual for co-pay assistance is based on an identification of claims and the cost per claim associated with product that has been recognized as revenue.
−Removed: The following table summarizes net product revenues for the twelve months ended December 31, 2020, 2019 and 2018 ( in thousands ):
+Added: The following table summarizes net product sales for the twelve months ended December 31, 2021, 2020 and 2019 ( in thousands ):
Twelve Months Ended December 31,
3 unchanged sentences
Total net product revenue $ 210,776 $ 198,321 $ 175,338
−Removed: FUTURE ACQUISITION RIGHT AND JOINT DEVELOPMENT AGREEMENT
−Removed: Censa Pharmaceuticals Inc.
−Removed: In December 2017, the Company entered into a Future Acquisition Right and Joint Development Agreement (the “Option Agreement”) with Censa.
−Removed: The Company made an upfront payment of $ 10.0 million, agreed to fund certain development activities of Censa’s CNSA-001 program which were approximately $ 19.9 million through proof of concept, and paid $ 5.0 million related to a development milestone for the right, but not the obligation, to acquire Censa (the “Option”) on the terms and subject to the conditions set forth in a separate Agreement and Plan of Merger.
−Removed: The Company capitalized the upfront and milestone payments and expensed the development funding as incurred.
−Removed: The Company treated the upfront payment and milestone payment, both of which were consideration for the Option, as a cost-method investment with a carrying value of $ 15.0 million.
−Removed: In August 2019, following a strategic review of the CNSA-001 program in patients with PKU, the Company made the decision to decline to exercise its option to acquire Censa Pharmaceuticals and accordingly discontinue its joint development program for CNSA-001.
−Removed: The Company impaired the $ 15 million long-term investment during the third quarter of 2019.
−Removed: ACQUISITIONS AND DISPOSITIONS
−Removed: Acquisition and disposition of Liquid Ursodeoxycholic Acid (L-UDCA)
−Removed: On June 20, 2016, the Company signed a definitive agreement to purchase the rights, titles, licenses and ownership of L-UDCA from Asklepion Pharmaceuticals, LLC ("Asklepion").
−Removed: The acquisition was accounted for under the acquisition method of accounting in accordance with Accounting Standard Codification ("ASC") 805.
−Removed: The fair value of assets acquired and liabilities assumed was based upon an independent third-party valuation and the Company’s estimates.
−Removed: Critical estimates in valuing certain intangible assets include but are not limited to future expected cash flows from acquired product rights for L-UDCA, licenses, trade names and developed technologies, present value and discount rates.
−Removed: Management’s estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates.
−Removed: The purchase included $ 25.5 million for an intangible asset with a definite life related to product rights in the U.S.
−Removed: The useful life related to the acquired product rights was expected to be approximately 17 years once the NDA was approved by the FDA.
−Removed: Until approval, the asset was considered IPR&D with an indefinite life and was not amortized.
−Removed: The contingent consideration of $ 25.0 million (present value) recorded during the period ended June 30, 2016, was related to an agreement to pay an additional cash amount in the form of milestones and sales royalties through 2035.
−Removed: During the first quarter of 2019, the Company elected to discontinue development of the L-UDCA program and wrote off the $ 25.5 million intangible asset and related contingent consideration liability of $ 18 million.
+Added: COLLABORATION AND LICENSE AGREEMENTS
+Added: On September 15, 2021, the Company entered into a license and collaboration agreement (“License Agreement”) with Vifor (International) Ltd.
+Added: (“Vifor Pharma”), pursuant to which the Company granted an exclusive license to Vifor Pharma for the commercialization of sparsentan in Europe, Australia and New Zealand ("Licensed Territories").
+Added: Vifor Pharma also has first right of negotiation to expand the licensed territories into Canada, China, Brazil and/ or Mexico.
+Added: Under the terms of the License Agreement, the Company received an upfront payment of $ 55.0 million and will be eligible for up to $ 135.0 million in aggregate regulatory and market access related milestone payments and up to $ 655.0 million in aggregate sales-based milestone payments for a total potential value of up to $ 845.0 million.
+Added: The Company is also entitled to receive tiered double-digit royalties of up to 40 percent of annual net sales of sparsentan in the Licensed Territories.
+Added: Under the License Agreement, Vifor Pharma will be responsible for all commercialization activities in the Licensed Territories.
+Added: The Company remains responsible for the worldwide clinical development of sparsentan through regulatory approval as defined and will retain all rights to sparsentan in the United States and rest of world outside of the Licensed Territories.
+Added: Development costs for any post regulatory approval development activities, subject to approval by both parties, will be borne by the Company and Vifor Pharma as defined, respectively.
+Added: The License Agreement will remain in effect, unless terminated earlier, until the expiration of all royalty terms for sparsentan in the licensed territories.
+Added: Each party has the right to terminate the License Agreement for the other party’s uncured material breach, insolvency or if the time required for performance under the License Agreement by the other party is extended due to a force majeure event that continues for six months or more.
+Added: The Company assessed the License Agreement and determined that it meets both criteria to be considered a collaborative agreement within the Scope of ASC 808, Collaborative Arrangements ("ASC 808") of active participation by both parties and exposures to significant risks and rewards dependent on the commercial success of the activities.
+Added: Both parties participate on joint steering and other committees overseeing the collaboration
+Added: Also, both parties are exposed to significant risks and rewards based on the economic outcomes of regulatory approvals and commercialization of sparsentan.
+Added: The Company determined the transaction price under the License Agreement totaled $ 55.0 million, consisting of the fixed non-refundable upfront payment.
+Added: The variable regulatory and access related milestones were excluded from the transaction price given the substantial uncertainty related to their achievement.
+Added: Sales-based milestone payments and royalties on net sales were excluded from the transaction price and will be recognized at the later of when the related sales occur or when the performance obligation to which the sales-based milestone or royalty has been allocated have been satisfied.
+Added: The Company concluded that Vifor Pharma represented a customer and applied relevant guidance from ASC 606 to evaluate the accounting under the License Agreement.
+Added: In accordance with this guidance, the Company concluded that the promise to grant the license is distinct from the promise to provide clinical development services resulting in two performance obligations as the license has stand-alone functionality due to sparsentan being a later stage asset and the clinical development services are primarily related to achieving regulatory approval.
+Added: As a result, the Company allocated $ 12.0 million of the transaction price, based on the performance obligations' relative standalone selling prices, to the license.
+Added: The remaining $ 43.0 million of the transaction price was allocated to the clinical development activities and recorded as deferred revenue, which will be recognized over the development period based upon the ratio of costs incurred to date to the total estimated costs.
+Added: The Company recognized a total of $ 16.7 million in license and collaboration revenue for the twelve months ended December 31, 2021, which consisted of $ 12.0 million from the license and $ 4.7 million from the clinical development activities, based upon the ratio of costs incurred to total estimated costs.
+Added: Deferred revenue related to the clinical development activities as of December 31, 2021 was $ 36.6 million.
+Added: Of this amount, $ 16.3 million was classified as current as of December 31, 2021, based upon amount expected to be realized within the next year.
+Added: In February 2021, the Company entered into a limited co-promotion agreement with Albireo Pharma, Inc.
+Added: ("Albireo"), whereby the Company's Cholbam dedicated sales representatives will dedicate a portion of their efforts to promoting Albireo's product, Bylvay (odevixibat), in the United States.
+Added: The initial term of the arrangement is two years from the July 2021 launch of Bylvay, terminable at will by either party after one year following launch.
+Added: For the year ended December 31, 2021, the Company recognized $ 1.8 million, offset against selling, general, and administrative expenses.
Acquisition of Orphan Technologies Limited
−Removed: On November 12, 2020, the Company completed the acquisition of Orphan Technologies Limited (“Orphan”), including Orphan’s rare metabolic disorder drug OT-58.
+Added: In November 2020, the Company completed the acquisition of Orphan Technologies Limited (“Orphan”), including Orphan’s rare metabolic disorder drug pegtibatinase (TVT-058).
The Company acquired Orphan by purchasing all of the outstanding shares.
In exchange for the shares, the Company made an upfront cash payment at closing of $ 90.0 million plus closing adjustments, net liabilities assumed, and transaction expenses of $ 1.2 million, $ 1.8 million, and $ 4.2 million, respectively.
−Removed: Under the Agreement, the Company has also agreed to make contingent cash payments up to an aggregate of $ 427.0 million based on the achievement of certain development, regulatory and commercialization events as set forth in the Agreement, as well as additional tiered mid-single digit royalty payments based upon future net sales of any OT-58 products in the US and Europe, subject to certain reductions as set forth in the Agreement, and a contingent payment in the event a pediatric rare disease voucher for any OT-58 product is granted.
−Removed: The Company has applied the principles of ASC 805 in determining the proper accounting treatment for the acquisition.
−Removed: Substantially all of the value of the assets acquired is concentrated within OT-58, and as of the acquisition date, the Company does not anticipate any economic benefit to be derived from OT-58 other than the primary indication.
−Removed: Accordingly, the transaction is treated as an asset acquisition with amounts charged to expense for the acquired IPR&D on the date of acquisition.
+Added: Under the Agreement, the Company has also agreed to make contingent cash payments up to an aggregate of $ 427.0 million based on the achievement of certain development, regulatory and commercialization events as set forth in the Agreement, as well as additional tiered mid-single digit royalty payments based upon future net sales of any pegtibatinase products in the US and Europe, subject to certain reductions as set forth in the Agreement, and a contingent payment in the event a pediatric rare disease voucher for any pegtibatinase product is granted.
+Added: The Company applied the principles of ASC 805 in determining the proper accounting treatment for the acquisition.
+Added: Substantially all of the value of the assets acquired was concentrated within pegtibatinase, and as of the acquisition date, the Company did not anticipate any economic benefit to be derived from pegtibatinase other than the primary indication.
+Added: Accordingly, the transaction was treated as an asset acquisition with amounts charged to expense for the acquired in-process research and development on the date of acquisition.
+Added: The Company incurred $ 97.1 million in expenses related to the Orphan acquisition, which was recognized in 2020.
In accordance with ASC 450, contingent cash payments will be accrued for when it is probable that a liability has been incurred and the amount can be reasonably estimated.
As of December 31, 2021, no contingent cash payments have been accrued.
−Removed: For the year ended December 31, 2020 the Company has incurred $ 97.1 million in expenses related to the Orphan acquisition.
−Removed: DEBT SECURITIES
−Removed: The Company's debt securities as of December 31, 2020 and 2019 were comprised of available-for-sale corporate and government debt securities.
+Added: MARKETABLE DEBT SECURITIES
+Added: The Company's marketable debt securities as of December 31, 2021 and 2020 were comprised of available-for-sale corporate and government debt securities.
These securities are carried at fair value, with the unrealized gains and losses reported in accumulated other comprehensive income (loss), unless an impairment is determined to be the result of credit-related factors or the Company intends to sell the security or it is more likely than not that the Company will be required to sell the security before recovery.
−Removed: The amortized cost of debt securities is adjusted for amortization of premiums and accretion of discounts to maturity.
+Added: The amortized cost of marketable debt securities is adjusted for amortization of premiums and accretion of discounts to maturity.
Such amortization and accretion is included in interest income.
4 unchanged sentences
All available-for-sale securities are classified as current assets, even if the maturity when acquired by the Company is greater than one year due to the ability to liquidate within the next 12 months.
−Removed: Debt securities consist of the following ( in thousands ):
+Added: Marketable debt securities consist of the following ( in thousands ):
As of December 31,
−Removed: Debt securities:
+Added: Marketable debt securities:
Commercial paper $ 127,379 $ 135,145
1 unchanged sentence
Securities of government sponsored entities 26,431 43,026
−Removed: Total debt securities $ 276,817 $ 336,088
−Removed: The following is a summary of short-term debt securities classified as available-for-sale as of December 31, 2020 ( in thousands ):
+Added: Total marketable debt securities $ 387,129 $ 276,817
+Added: The following is a summary of short-term marketable debt securities classified as available-for-sale as of December 31, 2021 ( in thousands ):
Contractual Maturity (in years) Amortized Cost Unrealized Gains Unrealized Losses Aggregate Estimated Fair Value
−Removed: Debt securities:
+Added: Marketable debt securities:
Commercial paper Less than 1 $ 127,435 $ — $ ( 57 ) $ 127,378
3 unchanged sentences
Corporate debt securities 1 to 2 120,705 — ( 289 ) 120,416
+Added: Securities of government-sponsored entities 1 to 2 4,549 — ( 22 ) 4,527
Total maturity 1 to 2 years 125,254 — ( 311 ) 124,943
−Removed: Total available-for-sale debt securities $ 276,111 $ 728 $ ( 22 ) $ 276,817
−Removed: The following is a summary of short-term debt securities classified as available-for-sale as of December 31, 2019 ( in thousands ):
+Added: Total available-for-sale marketable debt securities $ 387,599 $ — $ ( 470 ) $ 387,129
+Added: The following is a summary of short-term marketable debt securities classified as available-for-sale as of December 31, 2020 ( in thousands ):
Contractual Maturity (in years) Amortized Cost Unrealized Gains Unrealized Losses Aggregate Estimated Fair Value
−Removed: Debt securities:
+Added: Marketable debt securities:
Commercial paper Less than 1 $ 135,161 $ 1 $ ( 17 ) $ 135,145
Corporate debt securities Less than 1 92,906 723 — 93,629
+Added: Securities of government-sponsored entities Less than 1 43,031 — ( 5 ) 43,026
Total maturity less than 1 year 271,098 724 ( 22 ) 271,800
Corporate debt securities 1 to 2 5,013 4 — 5,017
−Removed: Securities of government-sponsored entities 1 to 2 12,501 — ( 1 ) 12,500
Total maturity 1 to 2 years 5,013 4 — 5,017
−Removed: Total available-for-sale debt securities $ 335,206 $ 949 $ ( 67 ) $ 336,088
−Removed: During 2020 and 2019, the Company had $ 0.1 million in net realized gains and zero realized gains or losses on debt securities, respectively.
−Removed: The Company received proceeds from the sale or maturity of debt securities of $ 273.5 million, $ 259.1 million and $ 162.8 million for 2020, 2019 and 2018, respectively.
−Removed: The primary objective of the Company’s investment portfolio is to enhance overall returns while preserving capital and liquidity.
+Added: Total available-for-sale marketable debt securities $ 276,111 $ 728 $ ( 22 ) $ 276,817
+Added: During 2021, the Company had less than $ 0.1 million in realized gains on marketable debt securities.
+Added: During 2020, the Company had $ 0.1 million in realized gains on marketable debt securities.
+Added: The Company received proceeds from the sale or maturity of marketable debt securities of $ 433.6 million, $ 273.5 million and $ 259.1 million for 2021, 2020 and 2019, respectively.
+Added: The primary objective of the Company’s investment portfolio is to preserve capital and liquidity while enhancing overall returns.
The Company’s investment policy limits interest-bearing security investments to certain types of instruments issued by institutions with primarily investment grade credit ratings and places restrictions on maturities and concentration by asset class and issuer.
−Removed: The Company reviews the available-for-sale debt securities for declines in fair value below the cost basis each quarter.
+Added: The Company reviews the available-for-sale marketable debt securities for declines in fair value below the cost basis each quarter.
For any security whose fair value is below its amortized cost basis, the Company first evaluates whether it intends to sell the impaired security, or will otherwise be more likely than not required to sell the security before recovery.
3 unchanged sentences
The portion of the unrealized loss related to factors other than credit losses is recognized in other comprehensive income (loss).
−Removed: The following is a summary of available-for-sale debt securities in an unrealized loss position with no credit losses reported as of December 31, 2020 ( in thousands ):
+Added: The following is a summary of available-for-sale marketable debt securities in an unrealized loss position with no credit losses reported as of December 31, 2021 ( in thousands ):
Less Than 12 Months 12 Months or Greater Total
4 unchanged sentences
Total $ 380,690 $ 470 $ — $ — $ 380,690 $ 470
−Removed: The following is a summary of available-for-sale debt securities in an unrealized loss position with no credit losses reported as of December 31, 2019 ( in thousands ):
+Added: The following is a summary of available-for-sale marketable debt securities in an unrealized loss position with no credit losses reported as of December 31, 2020 ( in thousands ):
Less Than 12 Months 12 Months or Greater Total
1 unchanged sentence
Commercial paper $ 112,148 $ 17 $ — $ — $ 112,148 $ 17
−Removed: Corporate debt securities 74,151 64 7,509 2 81,660 66
Securities of government-sponsored entities 43,026 5 — — 43,026 5
Total $ 155,174 $ 22 $ — $ — $ 155,174 $ 22
+Added: As of December 31, 2021 and December 31, 2020, the amortized cost of the available-for-sale marketable debt securities in an unrealized loss position was $ 381.2 million and $ 155.2 million, respectively.
As of December 31, 2021 and December 31, 2020, the Company does not intend to sell these investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost basis.
The Company does not believe the unrealized losses incurred during the period are due to credit-related factors.
−Removed: Liquidity issues that arose from economic circumstances surrounding the COVID-19 pandemic have continued to ease and unrealized losses observed in early 2020 have been substantially recovered.
−Removed: The credit ratings of the securities held remain of the highest quality, and while certain securities in the portfolio may be downgraded momentarily, the Federal Reserve has allowed institutions to continue to issue debt where there is need, with the government itself purchasing such securities.
+Added: Liquidity issues that arose from economic circumstances surrounding the COVID-19 pandemic have eased and the credit ratings of the securities held remain of the highest quality.
+Added: While certain securities in the portfolio may be downgraded momentarily, the Federal Reserve has allowed institutions to continue to issue debt where there is need, with the government itself purchasing such securities.
Moreover, the Company continues to receive payments of interest and principal as they become due, and our expectation is that those payments will continue to be received timely.
25 unchanged sentences
If a fundamental change (as defined in the 2025 Indenture) occurs, then, subject to certain exceptions, holders may require the Company to repurchase their 2025 Notes at a cash repurchase price equal to the principal amount of the 2025 Notes to be repurchased, plus accrued and unpaid interest, if any, to, but excluding, the fundamental change repurchase date.
−Removed: As of December 31, 2020, the 2025 Notes had a market price of $ 1,035 per $1,000 or $ 285.7 million principal amount.
+Added: As of December 31, 2021, the 2025 Notes had a market price of $ 1,089 per $1,000 principal amount, or $ 300.6 million.
In the event of conversion, holders would forgo all future interest payments, any unpaid accrued interest and the possibility of further stock price appreciation.
Upon the receipt of conversion requests, the settlement of the 2025 Notes will be paid pursuant to the terms of the 2025 Indenture.
−Removed: In the event that all of the 2025 Notes are converted, the Company would be required to repay the $ 276.0 million in principal value and any conversion premium in any combination of cash and shares of its common stock at the Company’s option.
+Added: In the event that all of the 2025
+Added: Notes are converted, the Company would be required to repay the $ 276.0 million in principal value and any conversion premium in any combination of cash and shares of its common stock at the Company’s option.
In addition, calling the 2025 Notes for redemption will constitute a “make whole fundamental change.”
The 2025 Notes are the Company’s general unsecured obligations that rank senior in right of payment to all of its indebtedness that is expressly subordinated in right of payment to the 2025 Notes, and equal in right of payment to the Company’s unsecured indebtedness.
−Removed: The 2025 Notes are currently classified on the Company’s consolidated balance sheet at December 31, 2020 as long-term debt.
−Removed: Under ASC 470-20, Debt with Conversion and Other Options, an entity must separately account for the liability and equity components of convertible debt instruments (such as the 2025 Notes) that may be settled entirely or partially in cash upon conversion, in a manner that reflects the issuer’s economic interest cost.
+Added: The 2025 Notes are currently classified on the Company’s consolidated balance sheet at December 31, 2021 as long-term convertible debt.
+Added: Under ASC 470-20, an entity must separately account for the liability and equity components of convertible debt instruments (such as the 2025 Notes) that may be settled entirely or partially in cash upon conversion, in a manner that reflects the issuer’s economic interest cost.
The liability component of the instrument is valued in a manner that reflects the market interest rate for a similar nonconvertible instrument at the date of issuance.
The initial carrying value of the liability component was $ 198.6 million.
−Removed: The equity component of $ 77.4 million, representing the conversion option, was determined by deducting the fair value of the liability component from the par value of the 2025 Notes and was recorded in additional paid-in capital on the consolidated balance sheet at the issuance date.
+Added: The equity component of $ 77.4 million, representing the conversion option, was determined by deducting the fair value of the liability component from the par value of the 2025 Notes and was recorded in additional paid-in capital on the Consolidated Balance Sheets at the issuance date.
That equity component is treated as a discount on the liability component of the 2025 Notes, which is amortized over the seven-year term of the 2025 Notes using the effective interest rate method.
2 unchanged sentences
Transaction costs attributable to the liability component are amortized to interest expense over the seven-year term of the 2025 Notes, and transaction costs attributable to the equity component are netted with the equity component in stockholders’ equity.
−Removed: The effective interest rate on the liability components of the 2025 Notes for the period from the date of issuance through December 31, 2020 was 7.7 %.
+Added: The effective interest rate on the liability components of the 2025 Notes for the years ended December 31, 2021, 2020 and 2019 was 7.7 %.
The following table sets forth total interest expense recognized related to the 2025 Notes ( in thousands ):
Twelve Months Ended December 31,
+Added: 2021 2020 2019
Contractual interest expense $ 6,900 $ 6,900 $ 6,900
4 unchanged sentences
The 2025 Indenture contains customary events of default with respect to the 2025 Notes, including that upon certain events of default, 100 % of the principal and accrued and unpaid interest on the 2025 Notes will automatically become due and payable.
−Removed: Convertible Senior Notes Due 2019
−Removed: On May 29, 2014, the Company entered into a Note Purchase Agreement relating to a private placement by the Company of $ 46 million aggregate principal senior convertible notes due 2019 (the “2019 Notes”) which were convertible into shares of the Company’s common stock at an initial conversion price of $ 17.41 per share.
−Removed: The conversion price was subject to customary anti-dilution protection.
−Removed: The 2019 Notes bore interest at a rate of 4.5 % per annum, payable semiannually in arrears on May 15 and November 15 of each year, beginning on November 15, 2014.
−Removed: The 2019 Notes
−Removed: had a maturity date of May 30, 2019.
−Removed: The aggregate carrying value of the 2019 Notes on their issuance was $ 43 million, which was net of the $ 3 million debt discount.
−Removed: In September 2018, the Company used part of the net proceeds from the issuance of the 2025 Notes discussed above to repurchase $ 23.4 million aggregate principal value of the 2019 Notes in privately-negotiated transactions for approximately $ 40.2 million in cash.
−Removed: The partial repurchase of the 2019 Notes resulted in a $ 17.0 million loss on early extinguishment of debt.
−Removed: As of December 31, 2018, the total 2019 Notes, net of unamortized debt discount and debt issuance costs was $ 22.5 million, consisting of $ 22.6 million of aggregate principle and $ 0.1 million of unamortized debt discount and debt issuance costs.
−Removed: In May 2019, the remaining $ 22.6 million outstanding principal amount of 2019 Notes was converted by the holders thereof into approximately 1.3 million shares of common stock.
Interest Expense
33 unchanged sentences
Cash and Cash Equivalents $ 165,753 $ 165,753 $ — $ —
−Removed: Debt securities, available-for-sale 276,817 — 276,817 —
+Added: Marketable debt securities, available-for-sale 387,129 — 387,129 —
Total $ 552,882 $ 165,753 $ 387,129 $ —
11 unchanged sentences
Cash and Cash Equivalents $ 84,772 $ 84,772 $ — $ —
−Removed: Debt securities, available-for-sale 336,088 — 336,088 —
+Added: Marketable debt securities, available-for-sale 276,817 — 276,817 —
Total $ 361,589 $ 84,772 $ 276,817 $ —
2 unchanged sentences
The following table sets forth a summary of changes in the estimated fair value of the Company's Level 3 business combination-related contingent consideration for the years ended December 31, 2021 and 2020 (in thousands) :
−Removed: Contingent Consideration (Level 3)
+Added: Fair Value Measurements of Acquisition-Related Contingent Consideration (Level 3)
Balance at January 1, $ 65,100 $ 70,900
−Removed: L-UDCA write-off — ( 18,000 )
Changes in the fair value of contingent consideration 22,260 3,655
6 unchanged sentences
In 2013, the Company entered into a $ 2.5 million agreement with Ligand for a worldwide sublicense to develop, manufacture and commercialize a drug technology compound including sparsentan (the “Ligand License Agreement”).
−Removed: The cost of the Ligand License Agreement, which is presented net of amortization in the accompanying Consolidated Balance Sheet in intangible assets, net, is being amortized to research and development on a straight-line basis through September 30, 2023.
+Added: The cost of the Ligand License Agreement, which is presented net of amortization in the accompanying Consolidated Balance Sheets in intangible assets, net, is being amortized to research and development on a straight-line basis through September 30, 2023.
As consideration for the license, we are required to make substantial payments upon the achievement of certain milestones, totaling up to $ 114.1 million.
32 unchanged sentences
There are 7.4 years remaining in the term of the license agreement.
−Removed: Cholbam (Kolbam) Asset Purchase
+Added: Cholbam Asset Purchase
On March 31, 2015, the Company completed its acquisition from Asklepion of all worldwide rights, titles and ownership of Cholbam, including all related contracts, data assets, intellectual property, regulatory assets and the PRV.
1 unchanged sentence
and international economic interest, respectively.
−Removed: On June 20, 2016, the Company signed a definitive agreement to purchase the rights, titles, and ownership of L-UDCA from Asklepion.
−Removed: The purchase included $ 25.5 million for an intangible asset with a definite life related to product rights for the U.S.
−Removed: During the first quarter of 2019, the Company elected to discontinue development of the L-UDCA program, resulting in the write off of the intangible asset of $ 25.5 million.
−Removed: See Note 5 for further discussion.
Amortizable intangible assets as of December 31, 2021 ( in thousands ):
2 unchanged sentences
Amortization Net Book Value
−Removed: Chenodal Product Rights 16 $ 67,849 $ ( 28,700 ) $ 39,149
Thiola License 15 $ 123,316 $ ( 37,992 ) $ 85,324
+Added: Chenodal Product Rights 16 67,849 ( 32,938 ) 34,911
Economic Interest - U.S.
revenue Cholbam 10 75,900 ( 51,258 ) 24,642
−Removed: Economic Interest - International revenue Cholbam 10 8,250 ( 5,673 ) 2,577
Ligand License 11 7,900 ( 5,875 ) 2,025
+Added: Economic Interest - International revenue Cholbam 10 7,982 ( 7,483 ) 499
Manchester Customer Relationships 10 403 ( 313 ) 90
−Removed: Manchester Trade Name 1 175 ( 175 ) —
Internal use software 5 207 ( 199 ) 8
4 unchanged sentences
Amortization Net Book Value
−Removed: Chenodal Product Rights 16 $ 67,849 $ ( 24,451 ) $ 43,398
Thiola License 15 $ 103,992 $ ( 28,117 ) $ 75,875
+Added: Chenodal Product Rights 16 67,849 ( 28,700 ) 39,149
Economic Interest - U.S.
revenue Cholbam 10 75,900 ( 43,675 ) 32,225
−Removed: Economic Interest - International revenue Cholbam 10 7,544 ( 3,585 ) 3,959
Ligand License 11 7,900 ( 4,717 ) 3,183
+Added: Economic Interest - International revenue Cholbam 10 8,250 ( 5,673 ) 2,577
Manchester Customer Relationships 10 403 ( 273 ) 130
−Removed: Manchester Trade Name 1 175 ( 175 ) —
Internal use software 5 207 ( 157 ) 50
+Added: Manchester trade name 1 175 ( 175 ) —
Total $ 264,676 $ ( 111,487 ) $ 153,189
8 unchanged sentences
Total $ 147,499
+Added: As of December 31, 2021 and 2020, the Company had goodwill of $ 0.9 million.
ACCRUED EXPENSES
Accrued expenses consist of the following at December 31, 2021 and 2020 ( in thousands ):
−Removed: Compensation related costs $ 17,912 $ 14,045
Research and development $ 26,841 $ 10,166
−Removed: Government rebates payable 10,707 6,584
−Removed: Selling, general and administrative 3,944 3,552
+Added: Compensation related costs 25,998 17,912
Accrued royalties and contingent consideration 8,402 7,857
+Added: Government rebates payable 7,493 10,707
Miscellaneous accrued 3,302 6,207
+Added: Selling, general and administrative 3,144 3,944
Total accrued expenses $ 75,180 $ 56,793
COMMITMENTS AND CONTINGENCIES
+Added: Contingencies
+Added: In October 2021, our Kolbam distributor in France notified us that the French authorities are asking for reimbursement for a portion of Kolbam sales in France during the periods from 2015-2020.
+Added: During this period, the Company had aggregate revenues from sales of Kolbam in France of approximately $ 8.0 million.
+Added: At this time, the Company is not able to estimate the potential liability that may be incurred, if any.
Legal Proceedings
12 unchanged sentences
Stockholders approved 1.4 million new shares to be issued under the 2015 Plan, in addition to 0.6 million unallocated shares remaining available for issuance under the 2014 Incentive Compensation Plan that were added to the 2015 Plan.
+Added: Options issued under the 2015 Plan will generally expire ten years from the date of grant and vest over a three-year or four-year period.
On May 18, 2016, the Company's stockholders approved an amendment to the 2015 Plan (the "Amended 2015 Plan").
10 unchanged sentences
On May 15, 2020, the Company's stockholders approved an amendment to the 2018 Plan that increased the number of authorized shares issuable under the 2018 Plan by 2.4 million shares.
+Added: On May 14, 2021, the Company’s stockholders approved an amendment to the 2018 Plan that increased the number of authorized shares issuable under the 2018 Plan by 3.2 million shares.
2017 Employee Stock Purchase Plan
59 unchanged sentences
Performance-based Stock Units
−Removed: As of December 31, 2020, there was approximately $ 0.7 million of unrecognized compensation cost related to performance-based stock units ("PSUs") granted.
+Added: PSUs are subject to vest only if certain specified criteria are achieved.
+Added: As of December 31, 2021, there was less than $ 0.1 million of unrecognized compensation cost related to performance-based stock units ("PSUs") granted.
This amount is expected to be recognized over a weighted average period of 0.5 years.
3 unchanged sentences
Unvested December 31, 2020 167,500 $ 16.48
−Removed: Granted 150,000 15.46
Vested ( 115,000 ) 15.46
8 unchanged sentences
Total $ 30,766 $ 23,614 $ 21,105
−Removed: Exercise of Warrants
−Removed: During the twelve months ended December 31, 2020, 2019 and 2018, the Company issued the following shares of common stock upon the exercise of warrants for cash received by the Company ( in thousands except share amounts ):
−Removed: Shares Issued Cash Received Derivative Liability Reclassified as Equity Change in Fair Value Expense
−Removed: 2018 1,036,054 $ 5,305 n/a n/a
−Removed: 2019 n/a n/a n/a n/a
−Removed: 2020 n/a n/a n/a n/a
−Removed: As of December 31, 2020, there are no warrants for common shares outstanding.
NET LOSS PER COMMON SHARE
Basic and diluted net loss per common share is calculated by dividing net loss applicable to common stockholders by the weighted-average number of common shares outstanding during the period.
−Removed: The Company’s potentially dilutive shares, which include outstanding stock options, restricted stock units, warrants, and shares issuable upon conversion of the 2025 Notes, are considered to be common stock equivalents and are not included in the calculation of diluted net loss per share because their effect is anti-dilutive.
+Added: The Company’s potentially dilutive shares, which include outstanding stock options, restricted stock units, and shares issuable upon conversion of the 2025 Notes, are considered to be common stock equivalents and are not included in the calculation of diluted net loss per share because their effect is anti-dilutive.
Basic and diluted net loss per share is calculated as follows (net loss amounts are stated in thousands) :
9 unchanged sentences
Options 9,214,188 8,349,310 7,644,251
−Removed: Warrants — — 282,807
Total anti-dilutive shares 17,897,060 16,830,808 15,875,963
7 unchanged sentences
See Note 5 for further discussion.
−Removed: The components of the (benefit) provision for income taxes, in the Consolidated Statement of Operations are as follows ( in thousands ):
+Added: The components of the provision (benefit) for income taxes, in the Consolidated Statements of Operations are as follows ( in thousands ):
2021 2020 2019
12 unchanged sentences
Federal IRS Audit settlement — % 1.62 % — %
−Removed: Convertible debt — % — % 21.77 %
−Removed: Loss on extinguishment of debt — % — % 4.09 %
+Added: Nondeductible executive compensation 0.48 % — % — %
+Added: Excess tax benefits associated with share-based awards 0.19 % — % — %
Other permanent differences 0.15 % 0.09 % 0.24 %
15 unchanged sentences
Interest expense limitation 2,802 1,659
+Added: Operating lease liabilities 8,825 7,314
Tax basis depreciation greater than book depreciation 13 76
1 unchanged sentence
Deferred Tax Liabilities:
−Removed: Intangible assets — ( 2,749 )
+Added: Operating lease right of use assets ( 5,782 ) ( 6,544 )
Convertible debt ( 11,020 ) ( 13,868 )
−Removed: Tax basis depreciation less than book depreciation — ( 448 )
( 16,802 ) ( 20,412 )
9 unchanged sentences
The Company increased its valuation allowance by $ 50.5 million and $ 63.1 million for the years ended December 31, 2021 and 2020, respectively.
−Removed: On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) was enacted in response to the COVID-19 pandemic.
−Removed: The CARES Act, among other things, permits NOL carryovers and carrybacks to offset 100% of taxable income for taxable years beginning before 2021.
−Removed: In addition, the CARES Act allows net operating losses incurred in tax years beginning after December 31, 2017 and before January 1, 2021 to be carried back to each of the five preceding taxable years to generate a refund of previously paid income taxes.
−Removed: The Company has recorded an income tax benefit of $ 18.1 million related to this legislation.
At December 31, 2021, the Company had available unused U.S.
9 unchanged sentences
As of December 31, 2021, the Company had $ 7.8 million in unrecognized tax benefits of which $ 7.5 million related to orphan drug and research and development tax credits which was recorded as a reduction to the deferred tax assets with a corresponding reduction in the Company’s valuation allowance of $ 7.5 million.
+Added: To the extent unrecognized tax benefits are recognized at a time when a valuation allowance does not exist, the recognition of the $ 7.5 million tax benefit would reduce the effective tax rate.
The Company does not anticipate that the amount of unrecognized tax benefits as of December 31, 2021 will change materially within the following 12 months.
1 unchanged sentence
Balance as of January 1:
+Added: $ 5,193 $ 235
Increase in current period positions 2,255 1,187
5 unchanged sentences
federal jurisdiction, various state and local, and foreign jurisdictions.
−Removed: With few exceptions, the Company’s income tax returns are open to examination by federal, state and foreign tax authorities for the years ended December 31, 2016 and forward.
−Removed: During the years ended 2020, 2019 and 2018, the Company did no t recognize any interest or penalties in its Consolidated Statements of Operations and Comprehensive Loss and there were no accruals recorded for interest or penalties at December 31, 2020 and 2019.
+Added: With few exceptions, the Company’s income tax returns are open to examination by federal authorities for the years ended December 31, 2018, and forward, and for state and foreign tax authorities, for the years ended December 31, 2017, and forward.
+Added: The Company recognizes interest and penalties as a component of income tax expense.
+Added: Interest and penalties for the year ended December 31, 2021 were less than $ 0.1 million.
+Added: The Company did no t recognize any interest or penalties for the years ended December 31, 2020 and 2019.
EQUITY OFFERINGS
−Removed: Underwritten Public Offering of Common Stock
−Removed: In June 2020, the Company sold an aggregate of 7.5 million shares of its common stock in an underwritten public offering, at a price of $ 15.50 per share.
+Added: Underwritten Public Offerings of Common Stock
+Added: In February 2021, we sold an aggregate of 7.5 million shares of our common stock in an underwritten public offering, at a price to the public of $ 26.75 per share.
+Added: The net proceeds to us from the offering, after deducting the underwriting discounts and offering expenses, were $ 189.3 million.
+Added: In June 2020, the Company sold an aggregate of 7.5 million shares of its common stock in an underwritten public offering, at a price to the public of $ 15.50 per share.
The net proceeds to the Company from the offering, after deducting the underwriting discounts and offering expenses, were $ 108.7 million.
1 unchanged sentence
In February 2020, the Company entered into an Open Market Sale Agreement ("ATM Agreement") with Jefferies LLC, as agent (“Jefferies”), pursuant to which the Company may offer and sell, from time to time through Jefferies, shares of its common stock having an aggregate offering price of up to $ 100.0 million.
−Removed: Shares will be sold pursuant to the Company's effective registration statement on Form S-3 (Registration Statement No.
−Removed: 333-227182), as previously filed with the Securities and Exchange Commission.
−Removed: Through the period ended December 31, 2020, the Company has sold 867,806 shares under the ATM Agreement, resulting in net proceeds of $ 22.8 million.
+Added: Of the $ 100.0 million originally authorized for sale under the ATM Agreement, approximately $ 28.6 million were sold under our prior registration statement on Form S-3 (Registration Statement No.
+Added: An additional $ 31.7 million were sold under our effective registration statement on Form S-3 (Registration Statement No.
+Added: In 2020, the Company sold 867,806 shares under the ATM Agreement, resulting in gross proceeds of $ 23.5 million.
+Added: In 2021, the Company sold a combined 1,240,640 shares under the ATM Agreement, resulting in gross proceeds of $ 36.8 million.
+Added: Through December 31, 2021, the Company has sold a total of 2,108,446 shares under the ATM Agreement, resulting in gross proceeds of $ 60.3 million.
As of December 31, 2021, an aggregate amount of $ 39.7 million remained eligible for sale under the facility.
+Added: Authorized Shares of Common Stock
+Added: On May 14, 2021, in connection with the Company’s 2021 Annual Meeting of Stockholders, the Company’s stockholders approved, among other matters, a Certificate of Amendment (“Certificate of Amendment”) to the Company’s Certificate of Incorporation to increase the number of shares of common stock authorized for issuance thereunder from 100,000,000 to 200,000,000 .
+Added: Effective May 18, 2021, the Certificate of Amendment was filed with the Secretary of State of the State of Delaware.
RETIREMENT PLAN
7 unchanged sentences
Construction-in-progress 631 6,339
+Added: 14,154 13,355
Accumulated depreciation ( 3,048 ) ( 3,937 )
1 unchanged sentence
The construction-in-process balance consists of costs related to the Company’s leasehold improvements at its facilities in San Diego, California.
+Added: Non-cash investing activities for the years ending December 31, 2021 and 2020 included accrued capital expenditures of $ 0.1 million and $ 1.9 million, respectively.
+Added: There were no accrued capital expenditures for the year ending December 31, 2019.
Depreciation expense for the years ended December 31, 2021, 2020 and 2019 was $ 1.7 million, $ 2.1 million and $ 0.7 million, respectively.
−Removed: The Company has not capitalized interest related to the property and equipment purchases.
−Removed: The Company adopted ASU No.
−Removed: 2016-02, Leases, as of January 1, 2019 using a modified retrospective basis method under which prior comparative periods are not restated.
−Removed: As of December 31, 2020, the Company had two operating leases with Kilroy Realty, L.P.
−Removed: (the "Landlord") for office space located in San Diego, California.
−Removed: The Company currently occupies certain office space subject to the first lease, originally signed in July 2016 and later amended in July 2017 and March 2019.
−Removed: In April 2019, the Company entered into a second office lease with the Landlord, which was subsequently amended in May 2020, for office space in an adjacent building located in San Diego, California.
−Removed: The Company has begun to consolidate its corporate headquarters into the new lease space beginning in late 2020 and into early 2021.
−Removed: As a condition of the new lease, the Company has been granted an existing premises continuation option to continue leasing all or a portion of the currently occupied office space, in addition to the new lease space.
−Removed: On February 7, 2020, the Company elected to forgo this continuation option by notifying the Landlord of its intention to vacate the premises of its existing lease.
−Removed: The abandonment of this leased office space, which was originally scheduled to expire in July 2024, coincides with the Company’s expected occupancy of the new office lease space in the adjacent building per the office lease effective April 2019.
−Removed: The Company estimates that it will fully vacate the existing leases in the first quarter of 2021, through which time the Company is obligated to pay all base rent, operating expenses and other obligations due under the existing lease.
−Removed: Coinciding with the notice delivered to the Landlord, the Company recorded an adjustment to the ROU ("Right-of-use") asset and lease liability in the first half of 2020 to reflect the impending expiration of the existing lease.
−Removed: The remeasurement of the lease liability resulted in a $ 7.4 million adjustment to the lease liability and ROU asset.
−Removed: The remeasured straight-line expense will be amortized over the revised lease term along with acceleration of related lease incentives.
−Removed: The ROU asset and lease liability related to the new office lease is established when the Company is granted access to the premises and has the ability to direct its use, which has occurred in phases over 2020 as leased spaces became available.
−Removed: As such, the ROU asset for the new lease has been established prior to the extinguishment of the ROU asset and lease liability for the existing lease, resulting in an overlap of ROU assets during the interim period between inception of the new lease and the expiration of the old lease.
−Removed: In June 2020 and September 2020, the Landlord delivered possession of the new lease spaces for the purpose of construction of leasehold improvements.
−Removed: Coinciding with our ability to direct the use of the respective spaces, and utilizing a discount rate equal to our borrowing rate at the time of measurement, the Company has established ROU assets totaling $ 34.6 million and lease liabilities totaling $ 34.5 million.
−Removed: The total resulting ROU asset and lease liability are each offset by lease incentives associated with tenant improvement allowances totaling $ 7.9 million.
−Removed: The initial term of the new lease is 7 years, 7 months , through August 2028, and the Landlord has granted the Company an option to extend the term of the lease by a period of 5 years.
+Added: As of December 31, 2021, the Company had one operating lease with Kilroy Realty, L.P.
+Added: (the "Landlord") for office space located in San Diego, California, which was entered into in April 2019 and subsequently amended in May 2020.
+Added: Coinciding with our ability to direct the use of the office space, which occurred in phases over 2020, and utilizing a discount rate equal to our borrowing rate, the Company established ROU assets totaling $ 34.6 million and lease liabilities totaling $ 34.5 million.
+Added: The total ROU asset and lease liability at measurement were each offset by lease incentives associated with tenant improvement allowances totaling $ 7.9 million.
+Added: The initial term of the office lease ends in August 2028, and the Landlord has granted the Company an option to extend the term of the lease by a period of 5 years.
At this time, it is not reasonably certain that we will extend the term of the lease and therefore the renewal period has been excluded from the aforementioned ROU asset and lease liability measurements.
−Removed: The measurement of the lease term occurs from the February 2021 planned occupancy date of the primary spaces delivered in September 2020.
+Added: The measurement of the lease term occurs from the February 2021 occupancy date of the office space delivered in September 2020.
The aggregate base rent due over the initial term of the lease is approximately $ 49.5 million.
3 unchanged sentences
Total undiscounted future minimum payments 43,719
−Removed: Lease incentives payable by lessor ( 6,873 )
Present value discount ( 8,314 )
−Removed: Total lease liability 28,693
−Removed: Unamortized lease incentives, less incentives payable by lessor ( 731 )
+Added: Total operating lease liability 35,405
+Added: Unamortized lease incentives ( 6,559 )
Cash payments in excess of straight-line lease expense ( 5,650 )
Total ROU asset $ 23,196
−Removed: As of December 31, 2020, the ROU asset of $ 25.7 million was recorded to the Consolidated Balance Sheets as non-current Other Assets.
−Removed: As of December 31, 2020, the current and non-current portions of the lease liability were recorded to the Consolidated Balance Sheets as follows ( in thousands ):
−Removed: December 31, 2020
−Removed: Other current liabilities $ 357
−Removed: Other non-current liabilities 28,336
−Removed: Total lease liabilities $ 28,693
For the twelve months ended December 31, 2021, 2020 and 2019 the Company recorded $ 4.9 million, $ 2.0 million, and $ 2.4 million, respectively, in expense related to operating leases, including amortized tenant improvement allowances.
Supplemental cash flow information related to leases is as follows ( in thousands ):
−Removed: December 31, 2020
−Removed: Noncash amounts included in the measurement of lease liabilities:
−Removed: Remeasurement for existing lease abandonment ( 7,430 )
−Removed: Initial measurement of new lease spaces 34,488
−Removed: Total noncash amounts included in the measurement of lease liabilities $ 27,058
−Removed: Noncash amounts included in the measurement of ROU assets:
−Removed: Remeasurement for existing lease abandonment ( 7,424 )
−Removed: Initial measurement of new lease spaces 34,612
−Removed: Total noncash amounts included in the measurement of ROU assets $ 27,188
+Added: 2021 2020 2019
+Added: Operating cash flows used for operating leases $ 2,205 $ 2,537 $ 2,639
SUBSEQUENT EVENTS
−Removed: Equity Offerings
−Removed: 2021 Underwritten Public Offering of Common Stock
−Removed: In February 2021, the Company sold an aggregate of 7.5 million shares of its common stock in an underwritten public offering, at a price of $ 26.75 per share.
−Removed: The net proceeds to the Company from the offering, after deducting the underwriting discounts and offering expenses, was $ 189.0 million.
−Removed: QUARTERLY FINANCIAL INFORMATION (UNAUDITED)
−Removed: The following table presents selected consolidated statements of operations data for each quarter for the fiscal years ended December 31, 2020 and 2019 (unaudited, in thousands, except for per share data) :
−Removed: Second Quarter First
−Removed: For the year ended December 31, 2020:
−Removed: Net product sales $ 50,983 $ 51,139 $ 48,430 $ 47,769
−Removed: Total operating expenses 169,533 1 70,574 71,541 62,836
−Removed: Operating loss ( 118,550 ) ( 19,435 ) ( 23,111 ) ( 15,067 )
−Removed: Total other expense, net ( 3,543 ) ( 3,091 ) ( 2,892 ) ( 3,101 )
−Removed: Loss before provision for income taxes ( 122,093 ) ( 22,526 ) ( 26,003 ) ( 18,168 )
−Removed: Income tax benefit (provision) 471 ( 23 ) ( 65 ) 18,976 2
−Removed: Net income (loss) $ ( 121,622 ) $ ( 22,549 ) $ ( 26,068 ) $ 808
−Removed: Net income (loss) per common share
−Removed: Basic and diluted $ ( 2.37 ) $ ( 0.44 ) $ ( 0.58 ) $ 0.02
−Removed: For the year ended December 31, 2019:
−Removed: Net product sales $ 46,688 $ 44,373 $ 44,707 $ 39,570
−Removed: Total operating expenses 74,855 78,810 3 81,236 77,798 4
−Removed: Operating loss ( 28,167 ) ( 34,437 ) ( 36,529 ) ( 38,228 )
−Removed: Total other income (expense), net ( 2,060 ) ( 2,576 ) ( 2,103 ) ( 2,348 )
−Removed: Income (loss) before provision for income taxes ( 30,227 ) ( 37,013 ) ( 38,632 ) ( 40,576 )
−Removed: Income tax benefit (provision) ( 32 ) 523 ( 69 ) ( 401 )
−Removed: Net income (loss) $ ( 30,259 ) $ ( 36,490 ) $ ( 38,701 ) $ ( 40,977 )
−Removed: Net loss per common share
−Removed: Basic and diluted $ ( 0.70 ) $ ( 0.85 ) $ ( 0.92 ) $ ( 0.99 )
−Removed: 1 In November 2020, the Company completed the acquisition of Orphan Technologies Limited (“Orphan”), including Orphan’s rare metabolic disorder drug OT-58.
−Removed: The transaction is treated as an asset acquisition with amounts charged to expense on the date of acquisition.
−Removed: For the year ended December 31, 2020 the Company has incurred $ 97.1 million in expense charges related to the Orphan acquisition.
−Removed: 2 In March 2020, the CARES Act was enacted in response to the COVID-19 pandemic.
−Removed: The Company recorded a discrete income tax benefit of $ 18.1 million related to this legislation in the first quarter of 2020.
−Removed: 3 In August 2019, following a strategic review of the CNSA-001 program in patients with PKU, the Company made the decision to decline to exercise its option to acquire Censa Pharmaceuticals and accordingly discontinue its joint development program for CNSA-001.
−Removed: The Company impaired the $ 15 million long-term investment during the third quarter of 2019.
−Removed: 4 During the first quarter of 2019, the Company elected to discontinue development of the L-UDCA program, resulting in the removal of the intangible asset of $ 25.5 million which was originally recorded in 2016, and the reversal of associated contingent consideration of $ 18.0 million.
−Removed: This resulted in a net $ 7.5 million non-cash charge to first quarter operations.
+Added: At-the-Market Equity Offering
+Added: From January 1, 2022 through February 22, 2022, the Company sold 701,600 shares of its common stock under the ATM Agreement, resulting in gross proceeds of $ 20.1 million.
+Added: After giving effect to such sales as of February 22, 2022, an aggregate amount of $ 19.6 million remained eligible for sale under the facility.
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.