Document and Entity Information - USD ($) |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2018 |
Feb. 19, 2019 |
Jun. 30, 2018 |
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Document and Entity Information | |||
Entity Registrant Name | IMMUNOGEN INC | ||
Entity Central Index Key | 0000855654 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2018 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $ 1,425,536,472 | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding | 149,409,825 | ||
Document Fiscal Year Focus | 2018 | ||
Document Fiscal Period Focus | FY |
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- Definition If the value is true, then the document is an amendment to previously-filed/accepted document. No definition available.
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- Definition End date of current fiscal year in the format --MM-DD. No definition available.
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- Definition This is focus fiscal period of the document report. For a first quarter 2006 quarterly report, which may also provide financial information from prior periods, the first fiscal quarter should be given as the fiscal period focus. Values: FY, Q1, Q2, Q3, Q4, H1, H2, M9, T1, T2, T3, M8, CY. No definition available.
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- Definition This is focus fiscal year of the document report in CCYY format. For a 2006 annual report, which may also provide financial information from prior periods, fiscal 2006 should be given as the fiscal year focus. Example: 2006. No definition available.
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- Definition The end date of the period reflected on the cover page if a periodic report. For all other reports and registration statements containing historical data, it is the date up through which that historical data is presented. If there is no historical data in the report, use the filing date. The format of the date is CCYY-MM-DD. No definition available.
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- Definition The type of document being provided (such as 10-K, 10-Q, 485BPOS, etc). The document type is limited to the same value as the supporting SEC submission type, or the word 'Other'. No definition available.
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- Definition A unique 10-digit SEC-issued value to identify entities that have filed disclosures with the SEC. It is commonly abbreviated as CIK. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Indicate number of shares or other units outstanding of each of registrant's classes of capital or common stock or other ownership interests, if and as stated on cover of related periodic report. Where multiple classes or units exist define each class/interest by adding class of stock items such as Common Class A [Member], Common Class B [Member] or Partnership Interest [Member] onto the Instrument [Domain] of the Entity Listings, Instrument. No definition available.
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- Definition Indicate 'Yes' or 'No' whether registrants (1) have filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that registrants were required to file such reports), and (2) have been subject to such filing requirements for the past 90 days. This information should be based on the registrant's current or most recent filing containing the related disclosure. No definition available.
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- Definition Indicate if registrant meets the emerging growth company criteria. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Indicate whether the registrant is one of the following: (1) Large Accelerated Filer, (2) Accelerated Filer, (3) Non-accelerated Filer, (4) Smaller Reporting Company (Non-accelerated), (5) Smaller Reporting Accelerated Filer or (6) Smaller Reporting Company and Large Accelerated Filer. Definitions of these categories are stated in Rule 12b-2 of the Exchange Act. This information should be based on the registrant's current or most recent filing containing the related disclosure. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition State aggregate market value of voting and non-voting common equity held by non-affiliates computed by reference to price at which the common equity was last sold, or average bid and asked price of such common equity, as of the last business day of registrant's most recently completed second fiscal quarter. The public float should be reported on the cover page of the registrants form 10K. No definition available.
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- Definition The exact name of the entity filing the report as specified in its charter, which is required by forms filed with the SEC. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Indicate if company meets the shell company criteria: a company with no or nominal operations, and with no or nominal assets or assets consisting solely of cash and cash equivalents. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Indicates that the company is a smaller reporting company with both a public float and revenues of less than $75 million. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Indicate 'Yes' or 'No' if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. No definition available.
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- Definition Indicate 'Yes' or 'No' if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Is used on Form Type: 10-K, 10-Q, 8-K, 20-F, 6-K, 10-K/A, 10-Q/A, 20-F/A, 6-K/A, N-CSR, N-Q, N-1A. No definition available.
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- References No definition available.
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- Definition The carrying amount of consideration received or receivable from sale of future royalties as of the balance sheet date on potential earnings that were not recognized as revenue in conformity with GAAP, and which are expected to be recognized as such within one year or the normal operating cycle, if longer No definition available.
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X | ||||||||||
- Definition The noncurrent portion of deferred revenue related to sale of future royalties as of balance sheet date No definition available.
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X | ||||||||||
- Definition Amounts of non-cash royalty receivable. No definition available.
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- Definition Carrying value as of the balance sheet date of liabilities incurred (and for which invoices have typically been received) and payable to vendors for goods and services received that are used in an entity's business. Used to reflect the current portion of the liabilities (due within one year or within the normal operating cycle if longer). Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition Amounts due from customers or clients, within one year of the balance sheet date (or the normal operating cycle, whichever is longer) for goods or services (including trade receivables) that have been delivered or sold in the normal course of business. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition Value received from shareholders in common stock-related transactions that are in excess of par value or stated value and amounts received from other stock-related transactions. Includes only common stock transactions (excludes preferred stock transactions). May be called contributed capital, capital in excess of par, capital surplus, or paid-in capital. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition Sum of the carrying amounts as of the balance sheet date of all assets that are recognized. Assets are probable future economic benefits obtained or controlled by an entity as a result of past transactions or events. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- References No definition available.
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X | ||||||||||
- Definition Sum of the carrying amounts as of the balance sheet date of all assets that are expected to be realized in cash, sold, or consumed within one year (or the normal operating cycle, if longer). Assets are probable future economic benefits obtained or controlled by an entity as a result of past transactions or events. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition Amount of currency on hand as well as demand deposits with banks or financial institutions. Includes other kinds of accounts that have the general characteristics of demand deposits. Also includes short-term, highly liquid investments that are both readily convertible to known amounts of cash and so near their maturity that they present insignificant risk of changes in value because of changes in interest rates. Excludes cash and cash equivalents within disposal group and discontinued operation. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition Represents the caption on the face of the balance sheet to indicate that the entity has entered into (1) purchase or supply arrangements that will require expending a portion of its resources to meet the terms thereof, and (2) is exposed to potential losses or, less frequently, gains, arising from (a) possible claims against a company's resources due to future performance under contract terms, and (b) possible losses or likely gains from uncertainties that will ultimately be resolved when one or more future events that are deemed likely to occur do occur or fail to occur. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition Aggregate par or stated value of issued nonredeemable common stock (or common stock redeemable solely at the option of the issuer). This item includes treasury stock repurchased by the entity. Note: elements for number of nonredeemable common shares, par value and other disclosure concepts are in another section within stockholders' equity. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition Amount, before allowance for credit loss, of right to consideration in exchange for good or service transferred to customer when right is conditioned on something other than passage of time, classified as current. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition Amount of obligation to transfer good or service to customer for which consideration has been received or is receivable, classified as current. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition Amount of obligation to transfer good or service to customer for which consideration has been received or is receivable, classified as noncurrent. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition Carrying amount of long-term convertible debt as of the balance sheet date, net of the amount due in the next twelve months or greater than the normal operating cycle, if longer. The debt is convertible into another form of financial instrument, typically the entity's common stock. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition Total of the carrying values as of the balance sheet date of obligations incurred through that date and payable for obligations related to services received from employees, such as accrued salaries and bonuses, payroll taxes and fringe benefits. Used to reflect the current portion of the liabilities (due within one year or within the normal operating cycle if longer). Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition This item represents the deferred credit for an incentive or inducement received by a lessee from a lessor, in order to motivate the lessee to enter the lease agreement, which incentive or inducement is to be recognized as a reduction of rental expense over the lease term. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition Amount after valuation and LIFO reserves of inventory expected to be sold, or consumed within one year or operating cycle, if longer. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition This item represents an incentive or inducement contractually stipulated between parties to a lease whereby the lessor has committed to provide the entity (lessee) with a cash payment as inducement to enter the lease. Used to reflect the current portion of the liabilities (due within one year or within the normal operating cycle if longer). Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition Sum of the carrying amounts as of the balance sheet date of all liabilities that are recognized. Liabilities are probable future sacrifices of economic benefits arising from present obligations of an entity to transfer assets or provide services to other entities in the future. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition Amount of liabilities and equity items, including the portion of equity attributable to noncontrolling interests, if any. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- References No definition available.
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- Definition Total obligations incurred as part of normal operations that are expected to be paid during the following twelve months or within one business cycle, if longer. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition Amount of expenses incurred but not yet paid classified as other, due within one year or the normal operating cycle, if longer. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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X | ||||||||||
- Definition Amount of noncurrent assets classified as other. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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X | ||||||||||
- Definition Amount of liabilities classified as other, due after one year or the normal operating cycle, if longer. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition Aggregate par or stated value of issued nonredeemable preferred stock (or preferred stock redeemable solely at the option of the issuer). This item includes treasury stock repurchased by the entity. Note: elements for number of nonredeemable preferred shares, par value and other disclosure concepts are in another section within stockholders' equity. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition Amount of asset related to consideration paid in advance for costs that provide economic benefits in future periods, and amount of other assets that are expected to be realized or consumed within one year or the normal operating cycle, if longer. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition Amount after accumulated depreciation, depletion and amortization of physical assets used in the normal conduct of business to produce goods and services and not intended for resale. Examples include, but are not limited to, land, buildings, machinery and equipment, office equipment, and furniture and fixtures. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition The cumulative amount of the reporting entity's undistributed earnings or deficit. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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X | ||||||||||
- Definition Total of all stockholders' equity (deficit) items, net of receivables from officers, directors, owners, and affiliates of the entity which are attributable to the parent. The amount of the economic entity's stockholders' equity attributable to the parent excludes the amount of stockholders' equity which is allocable to that ownership interest in subsidiary equity which is not attributable to the parent (noncontrolling interest, minority interest). This excludes temporary equity and is sometimes called permanent equity. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- References No definition available.
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- Definition Amount received for services rendered and products shipped, but not yet billed, for non-contractual agreements due within one year or the normal operating cycle, if longer. No definition available.
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CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) shares in Thousands, $ in Thousands |
Dec. 31, 2018 |
Dec. 31, 2017 |
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CONSOLIDATED BALANCE SHEETS | ||
Current portion of deferred financing costs for the liability related to the sale of future royalties | $ 753 | $ 772 |
Interest rate (as a percent) | 4.50% | |
Non-current deferred financing costs | $ 36 | 50 |
Noncurrent portion of deferred financing costs for the liability related to the sale of future royalties | $ 1,536 | $ 2,373 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, authorized shares | 5,000 | 5,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, authorized shares | 200,000 | 200,000 |
Common stock, issued shares | 149,400 | 132,526 |
Common stock, outstanding shares | 149,400 | 132,526 |
X | ||||||||||
- Definition Amount, after accumulated amortization, of debt issuance costs classified as current for the liability related to the sale of future royalties. No definition available.
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- Definition Amount, after accumulated amortization, of debt issuance costs classified as long-term for the liability related to the sale of future royalties. No definition available.
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X | ||||||||||
- Definition Face amount or stated value per share of common stock. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition The maximum number of common shares permitted to be issued by an entity's charter and bylaws. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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X | ||||||||||
- Definition Total number of common shares of an entity that have been sold or granted to shareholders (includes common shares that were issued, repurchased and remain in the treasury). These shares represent capital invested by the firm's shareholders and owners, and may be all or only a portion of the number of shares authorized. Shares issued include shares outstanding and shares held in the treasury. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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X | ||||||||||
- Definition Number of shares of common stock outstanding. Common stock represent the ownership interest in a corporation. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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X | ||||||||||
- Definition Contractual interest rate for funds borrowed, under the debt agreement. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition Amount, after accumulated amortization, of debt issuance costs classified as noncurrent. Includes, but is not limited to, legal, accounting, underwriting, printing, and registration costs. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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X | ||||||||||
- Definition Face amount or stated value per share of preferred stock nonredeemable or redeemable solely at the option of the issuer. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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X | ||||||||||
- Definition The maximum number of nonredeemable preferred shares (or preferred stock redeemable solely at the option of the issuer) permitted to be issued by an entity's charter and bylaws. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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X | ||||||||||
- Definition Total number of nonredeemable preferred shares (or preferred stock redeemable solely at the option of the issuer) issued to shareholders (includes related preferred shares that were issued, repurchased, and remain in the treasury). May be all or portion of the number of preferred shares authorized. Excludes preferred shares that are classified as debt. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition Aggregate share number for all nonredeemable preferred stock (or preferred stock redeemable solely at the option of the issuer) held by stockholders. Does not include preferred shares that have been repurchased. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- References No definition available.
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X | ||||||||||
- Definition Amount of the cost of borrowed funds accounted for as interest expense on liability related to the sale of future royalties and other debt. No definition available.
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X | ||||||||||
- Definition Amount after tax of increase (decrease) in equity from transactions and other events and circumstances from net income and other comprehensive income, attributable to parent entity. Excludes changes in equity resulting from investments by owners and distributions to owners. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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X | ||||||||||
- Definition The amount of net income or loss for the period per each share in instances when basic and diluted earnings per share are the same amount and reported as a single line item on the face of the financial statements. Basic earnings per share is the amount of net income or loss for the period per each share of common stock or unit outstanding during the reporting period. Diluted earnings per share includes the amount of net income or loss for the period available to each share of common stock or common unit outstanding during the reporting period and to each share or unit that would have been outstanding assuming the issuance of common shares or units for all dilutive potential common shares or units outstanding during the reporting period. Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef
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- Definition The aggregate total of expenses of managing and administering the affairs of an entity, including affiliates of the reporting entity, which are not directly or indirectly associated with the manufacture, sale or creation of a product or product line. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition Consideration given by issuer of convertible debt to provide an incentive for debt holders to convert the debt to equity securities. The expense is equal to the fair value of all securities and other consideration transferred in the transaction in excess of the fair value of securities issuable pursuant to the original conversion terms. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition Amount of the cost of borrowed funds accounted for as interest expense for debt. Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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- Definition Amount after accretion (amortization) of discount (premium), and investment expense, of interest income and dividend income on nonoperating securities. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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X | ||||||||||
- Definition The portion of profit or loss for the period, net of income taxes, which is attributable to the parent. Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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X | ||||||||||
- Definition Generally recurring costs associated with normal operations except for the portion of these expenses which can be clearly related to production and included in cost of sales or services. Includes selling, general and administrative expense. No definition available.
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X | ||||||||||
- References No definition available.
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X | ||||||||||
- Definition The net result for the period of deducting operating expenses from operating revenues. No definition available.
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X | ||||||||||
- Definition Amount of income (expense) related to nonoperating activities, classified as other. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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X | ||||||||||
- Definition The aggregate costs incurred (1) in a planned search or critical investigation aimed at discovery of new knowledge with the hope that such knowledge will be useful in developing a new product or service, a new process or technique, or in bringing about a significant improvement to an existing product or process; or (2) to translate research findings or other knowledge into a plan or design for a new product or process or for a significant improvement to an existing product or process whether intended for sale or the entity's use, during the reporting period charged to research and development projects, including the costs of developing computer software up to the point in time of achieving technological feasibility, and costs allocated in accounting for a business combination to in-process projects deemed to have no alternative future use. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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X | ||||||||||
- Definition Amount of expenses associated with exit or disposal activities pursuant to an authorized plan. Excludes expenses related to a discontinued operation or an asset retirement obligation. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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X | ||||||||||
- Definition Amount, including tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value-added and excise. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- References No definition available.
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X | ||||||||||
- Definition Average number of shares or units issued and outstanding that are used in calculating basic and diluted earnings per share (EPS). No definition available.
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- Details
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- Details
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- Details
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- Details
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- Details
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- Definition This element represents the amount of deferred share unit compensation of directors recognized during the period, that is, the amount recognized as expense in the income statement (or as asset if compensation is capitalized). No definition available.
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X | ||||||||||
- Definition Number of share options (or share units) exercised during the current period. No definition available.
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X | ||||||||||
- Definition The number of shares issued during the period upon the conversion of directors' deferred share units. No definition available.
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X | ||||||||||
- Definition Value of stock issued during the period upon the conversion of directors' deferred share units. No definition available.
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X | ||||||||||
- Definition Value of stock issued as a result of the exercise of stock options and employee stock ownership plan (ESOP). No definition available.
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X | ||||||||||
- Definition Amount of increase to additional paid-in capital (APIC) from recognition of equity-based compensation. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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X | ||||||||||
- Definition Total number of common shares of an entity that have been sold or granted to shareholders (includes common shares that were issued, repurchased and remain in the treasury). These shares represent capital invested by the firm's shareholders and owners, and may be all or only a portion of the number of shares authorized. Shares issued include shares outstanding and shares held in the treasury. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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X | ||||||||||
- Definition Amount after tax of increase (decrease) to equity or (increase) decrease to net assets, resulting from the cumulative effect adjustment of a new accounting principle applied in the period of adoption. No definition available.
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X | ||||||||||
- Definition The value of the financial instrument(s) that the original debt is being converted into in a noncash (or part noncash) transaction. "Part noncash" refers to that portion of the transaction not resulting in cash receipts or cash payments in the period. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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X | ||||||||||
- Definition The number of shares issued in exchange for the original debt being converted in a noncash (or part noncash) transaction. "Part noncash" refers to that portion of the transaction not resulting in cash receipts or payments in the period. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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X | ||||||||||
- Definition A roll forward is a reconciliation of a concept from the beginning of a period to the end of a period. No definition available.
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X | ||||||||||
- Definition The portion of profit or loss for the period, net of income taxes, which is attributable to the parent. Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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X | ||||||||||
- Definition Number of new stock issued during the period. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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X | ||||||||||
- Definition Total number of shares issued during the period, including shares forfeited, as a result of Restricted Stock Awards. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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X | ||||||||||
- Definition Number of shares issued during the period related to Restricted Stock Awards, net of any shares forfeited. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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X | ||||||||||
- Definition Number of share options (or share units) exercised during the current period. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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X | ||||||||||
- Definition Equity impact of the value of new stock issued during the period. Includes shares issued in an initial public offering or a secondary public offering. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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X | ||||||||||
- Definition Aggregate value of stock related to Restricted Stock Awards issued during the period. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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X | ||||||||||
- Definition Value of stock related to Restricted Stock Awards issued during the period, net of the stock value of such awards forfeited. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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X | ||||||||||
- Definition Value of stock issued as a result of the exercise of stock options. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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X | ||||||||||
- Definition Total of all stockholders' equity (deficit) items, net of receivables from officers, directors, owners, and affiliates of the entity which are attributable to the parent. The amount of the economic entity's stockholders' equity attributable to the parent excludes the amount of stockholders' equity which is allocable to that ownership interest in subsidiary equity which is not attributable to the parent (noncontrolling interest, minority interest). This excludes temporary equity and is sometimes called permanent equity. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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X | ||||||||||
- Definition The increase (decrease) during the reporting period of the amount of revenue for work performed for which billing has not occurred, net of uncollectible accounts. No definition available.
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- Definition The net change during the reporting period in the amount paid that is the result of the cumulative difference between actual rent payment and rent expense recognized on a straight-line basis. No definition available.
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- Definition Amount of the cost of borrowed funds accounted for as interest expense on liability related to the sale of future royalties and other debt. No definition available.
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- Definition Revenue earned from sale of future royalties during the period from the leasing or otherwise lending to a third party the entity's rights or title to certain property No definition available.
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- References No definition available.
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- Definition Amount of currency on hand as well as demand deposits with banks or financial institutions. Includes other kinds of accounts that have the general characteristics of demand deposits. Also includes short-term, highly liquid investments that are both readily convertible to known amounts of cash and so near their maturity that they present insignificant risk of changes in value because of changes in interest rates. Excludes cash and cash equivalents within disposal group and discontinued operation. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition Amount of increase (decrease) in cash and cash equivalents. Cash and cash equivalents are the amount of currency on hand as well as demand deposits with banks or financial institutions. Includes other kinds of accounts that have the general characteristics of demand deposits. Also includes short-term, highly liquid investments that are both readily convertible to known amounts of cash and so near their maturity that they present insignificant risk of changes in value because of changes in interest rates. Includes effect from exchange rate changes. No definition available.
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- Definition The aggregate expense recognized in the current period that allocates the cost of tangible assets, intangible assets, or depleting assets to periods that benefit from use of the assets. Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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- Definition Amount of gain (loss) on sale or disposal of property, plant and equipment assets, including oil and gas property and timber property. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition The increase (decrease) during the reporting period in the aggregate amount of liabilities incurred (and for which invoices have typically been received) and payable to vendors for goods and services received that are used in an entity's business. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition The increase (decrease) during the reporting period in amount due within one year (or one business cycle) from customers for the credit sale of goods and services. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition Amount of increase (decrease) in right to consideration in exchange for good or service transferred to customer when right is conditioned on something other than passage of time. Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef
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- Definition Amount of increase (decrease) in obligation to transfer good or service to customer for which consideration has been received or is receivable. Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef
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- Definition The increase (decrease) during the reporting period in the aggregate amount of obligations related to services received from employees, such as accrued salaries and bonuses, payroll taxes and fringe benefits. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition The increase (decrease) during the reporting period in the aggregate value of all inventory held by the reporting entity, associated with underlying transactions that are classified as operating activities. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition The increase (decrease) during the reporting period in other expenses incurred but not yet paid. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition Amount of increase (decrease) in operating assets classified as other. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition Amount of increase (decrease) in prepaid expenses, and assets classified as other. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition Consideration given by issuer of convertible debt to provide an incentive for debt holders to convert the debt to equity securities. The expense is equal to the fair value of all securities and other consideration transferred in the transaction in excess of the fair value of securities issuable pursuant to the original conversion terms. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition Amount of cash paid for interest, excluding capitalized interest, classified as operating activity. Includes, but is not limited to, payment to settle zero-coupon bond for accreted interest of debt discount and debt instrument with insignificant coupon interest rate in relation to effective interest rate of borrowing attributable to accreted interest of debt discount. Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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- Definition Amount of cash inflow (outflow) from financing activities, including discontinued operations. Financing activity cash flows include obtaining resources from owners and providing them with a return on, and a return of, their investment; borrowing money and repaying amounts borrowed, or settling the obligation; and obtaining and paying for other resources obtained from creditors on long-term credit. Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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- Definition Amount of cash inflow (outflow) from investing activities, including discontinued operations. Investing activity cash flows include making and collecting loans and acquiring and disposing of debt or equity instruments and property, plant, and equipment and other productive assets. Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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- Definition Amount of cash inflow (outflow) from operating activities, including discontinued operations. Operating activity cash flows include transactions, adjustments, and changes in value not defined as investing or financing activities. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition Net cash outflow or inflow from monetary allowance granted by the landlord to a tenant to entice tenant to move into landlords building which will enable the tenant to prepare the leased premises for tenants occupancy. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition The cash outflow for cost incurred in the modification of term of existing debt agreement in order for the entity to achieve some advantage. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition The cash outflow associated with the acquisition of long-lived, physical assets that are used in the normal conduct of business to produce goods and services and not intended for resale; includes cash outflows to pay for construction of self-constructed assets. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition The cash inflow from the issuance of a long-term debt instrument which can be exchanged for a specified amount of another security, typically the entity's common stock, at the option of the issuer or the holder. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition The cash inflow from the additional capital contribution to the entity. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition Amount of cash inflow from exercise of stock options granted under share-based compensation arrangement. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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- Definition The consolidated profit or loss for the period, net of income taxes, including the portion attributable to the noncontrolling interest. Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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- Definition The aggregate amount of noncash, equity-based employee remuneration. This may include the value of stock or unit options, amortization of restricted stock or units, and adjustment for officers' compensation. As noncash, this element is an add back when calculating net cash generated by operating activities using the indirect method. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) $ in Thousands |
12 Months Ended | |
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Dec. 31, 2018 |
Dec. 31, 2017 |
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CONSOLIDATED STATEMENTS OF CASH FLOWS | ||
Transaction costs | $ 395 | $ 222 |
Interest rate (as a percent) | 4.50% |
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- Definition Contractual interest rate for funds borrowed, under the debt agreement. Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
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Nature of Business and Plan of Operations |
12 Months Ended |
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Dec. 31, 2018 | |
Nature of Business and Plan of Operations | |
Nature of Business and Plan of Operations | A. Nature of Business and Plan of Operations
ImmunoGen, Inc. (the Company) was incorporated in Massachusetts in 1981 and is focused on the development of antibody‑drug conjugates, or ADCs. The Company has generally incurred operating losses and negative cash flows from operations since inception, incurred a net loss of approximately $168.8 million during the year ended December 31, 2018, and has an accumulated deficit of approximately $1.2 billion as of December 31, 2018. The Company has primarily funded these losses through payments received from its collaborations and equity and convertible debt financings. To date, the Company has no product revenue and management expects operating losses to continue for the foreseeable future. At December 31, 2018, the Company had $262.3 million of cash and cash equivalents on hand. The Company anticipates that its current capital resources and the $65.2 million raised from the sale of its residual rights to Kadcyla royalties in January 2019 (see Note F) will enable it to meet its operational expenses and capital expenditures for more than twelve months after these financial statements are issued. The Company may raise additional funds through equity or debt financings or generate revenues from collaborators through a combination of upfront license payments, milestone payments, royalty payments, and research funding. There can be no assurance that the Company will be able to obtain additional debt or equity financing or generate revenues from collaborators on terms acceptable to the Company or at all. The failure of the Company to obtain sufficient funds on acceptable terms when needed could have a material adverse effect on the Company’s business, results of operations and financial condition and require the Company to defer or limit some or all of its research, development and/or clinical projects. The Company is subject to risks common to companies in the biotechnology industry including, but not limited to, the development by its competitors of new technological innovations, dependence on key personnel, protection of proprietary technology, manufacturing and marketing limitations, complexities associated with managing collaboration arrangements, third‑party reimbursements, and compliance with governmental regulations.
In June 2016, the Company’s Board of Directors approved a change in the Company’s fiscal year from a fiscal year ending on the last day of June of each year to a calendar fiscal year ending on the last day of December of each year, effective January 1, 2017. Accordingly, in addition to financial statements as of and for the years ended December 31, 2018 and 2017, these financial statements contain six-month transitional financial statements as of and for the period ending December 31, 2016. |
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- Definition The entire disclosure for the nature of an entity's business, major products or services, principal markets including location, and the relative importance of its operations in each business and the basis for the determination, including but not limited to, assets, revenues, or earnings. For an entity that has not commenced principal operations, disclosures about the risks and uncertainties related to the activities in which the entity is currently engaged and an understanding of what those activities are being directed toward. Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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Summary of Significant Accounting Policies |
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Summary of Significant Accounting Policies | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Significant Accounting Policies | B. Summary of Significant Accounting Policies Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, ImmunoGen Securities Corp., ImmunoGen Europe Limited, ImmunoGen (Bermuda) Ltd., ImmunoGen BioPharma (Ireland) Limited, and Hurricane, LLC. All intercompany transactions and balances have been eliminated. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States (U.S.) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Subsequent Events The Company has evaluated all events or transactions that occurred after December 31, 2018 up through the date the Company issued these financial statements. In January 2019, the Company sold its residual rights to receive royalty payments on commercial sales of Kadcyla to OMERS, the defined benefit pension plan for municipal employees in the Province of Ontario, Canada, for $65.2 million, net of fees. On March 1, 2019, the Company announced that FORWARD I did not meet its PFS primary endpoint in either the entire study population or in the pre-specified subset of patients with high-FRα expression. The Company plans to conduct a full review of the FORWARD I data to determine potential next steps with mirvetuximab as a single agent, and assess its ongoing FORWARD II combination studies as a separate path forward to support a registration in ovarian cancer.
The Company did not have any other material recognizable or unrecognizable subsequent events. Adoption of ASC Topic 606, Revenue from Contracts with Customers
The Company adopted Accounting Standards Codification Topic or ASC, 606 – Revenue from Contracts with Customers, (ASC 606) on January 1, 2018, using the modified retrospective method for all contracts not completed as of the date of adoption. The reported results for 2018 reflect the application of ASC 606 guidance, while the reported results prior to 2018 were prepared under the guidance of ASC 605, Revenue Recognition (ASC 605), which is also referred to herein as "legacy GAAP" or the "previous guidance."
Financial Statement Impact of Adopting ASC 606
The cumulative effect of applying the new guidance to all contracts with customers that were not completed as of December 31, 2017, was recorded as an adjustment to accumulated deficit as of the adoption date. As a result of applying the modified retrospective method to adopt the new revenue guidance, the following adjustments were made to accounts on the condensed consolidated balance sheet as of January 1, 2018:
IMMUNOGEN, INC. ADJUSTED CONSOLIDATED BALANCE SHEET In thousands, except per share amounts
Under the previous guidance, the Company deferred revenue pertaining to the transfer of certain exclusive commercialization and development licenses, and to account for these agreements under the legacy GAAP, the Company identified the deliverables included within the agreements and evaluated which deliverables represented separate units of accounting based on whether certain criteria were met, including whether the delivered element had stand-alone value to the collaborator. The consideration received was allocated among the separate units of accounting, and the applicable revenue recognition criteria were applied to each of the separate units. Under ASC 606, the Company recognizes revenues from non-refundable, up-front fees allocated to the license when the license is distinct from other performance obligations, is transferred to the customer and the customer is able to use and benefit from the license.
Under the previous guidance, milestones that were considered substantive because the Company contributed significant effort to the achievement of such milestones were recognized as revenue upon achievement of the milestone. Under ASC 606, if the achievement of a milestone is considered a direct result of the Company’s efforts to satisfy a performance obligation or transfer a distinct good or service, the associated milestone value is allocated to that distinct good or service. If a milestone is not specifically related to the Company’s effort to satisfy a performance obligation or transfer a distinct good or service, the amount is allocated to all performance obligations using the relative standalone selling price method.
Under ASC 606, the Company also evaluates the milestone to determine whether the milestone is probable of being achieved and estimates the amount to be included in the transaction price. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price to be allocated, otherwise, such amounts are constrained and excluded from the transaction price until the probable threshold is met. The Company determined it was probable that a future $5.0 million milestone for Takeda enrolling a patient in a Phase I trial as of the date of adoption would occur and, accordingly, recorded a reduction to accumulated deficit of $4.6 million related to this previously delivered license as approximately $400,000 was allocated to undelivered rights to future technological improvements. The $5.0 million contract asset recorded for the probable milestone was netted against contract liabilities related to the specific contract. Prior to the adoption of ASC 606, the Company recognized royalty revenue when it could reliably estimate such amounts and collectability was reasonably assured. As such, the Company generally recognized revenue for sales royalties in the quarter the amounts were reported to the Company by its licensees, or one quarter following the quarter in which sales by the Company’s licensees occurred. Under ASC 606, if the license is deemed to be the predominant item to which the royalties relate, the Company will recognize revenue at the later of (i) when the related sales occur, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied). As a result of recognizing royalties for sales in the fourth quarter of fiscal year 2017, the Company recognized a reduction to accumulated deficit of $8.9 million. The net impact of these changes resulted in a $14.1 million reduction to accumulated deficit, a $5.2 million reduction to deferred revenue and an $8.9 million increase in non-cash royalty receivable. The adoption of ASC 606 resulted in the acceleration of revenue through December 31, 2017, which in turn reduced the related net deferred tax asset by $3.9 million. As the Company fully reserves its net deferred tax assets, the impact was offset by the valuation allowance. Impact of ASC 606 Revenue Guidance on Financial Statement Line Items
The following tables compare the reported condensed consolidated balance sheet and statement of operations, as of and for the year ended December 31, 2018, to the pro-forma amounts had the previous guidance been in effect:
IMMUNOGEN, INC. PRO FORMA CONSOLIDATED BALANCE SHEET In thousands, except per share amounts
As a result of adoption of ASC 606, a receivable is recorded for royalties earned during the current quarter rather than one quarter in arrears under the previous guidance. Deferred revenue increased under ASC 606 due to a greater amount of the transaction prices being allocated to the future technological improvement rights under ASC 606.
IMMUNOGEN, INC. PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS In thousands, except per share amounts
Under the previous guidance, non-cash royalty revenue would have been lower than the amount recorded for the year ended December 31, 2018, due to higher Kadcyla sales in the fourth quarter of 2018 versus 2017 (because under the previous guidance, the Company recorded the royalties one quarter in arrears as previously described). License and milestone fee revenue for the year ended December 31, 2018 would have been higher due to a $5.0 million milestone that would have been included as license and milestone fee revenue in 2018 under the legacy accounting, however, due to its probability of occurring at the time of transition to ASC 606, it was recognized as part of the transition adjustment. Partially offsetting this change, less license and milestone fee revenue would have been recognized under the previous guidance related to a partner foregoing its remaining rights under a right-to-test agreement upon expiration in March 2018, as well as partners terminating their rights under certain development and commercialization licenses during the year. A greater amount of the transaction price was allocated to the expired and terminated material rights under ASC 606 than under the previous guidance.
The adoption of ASC 606 had no aggregate impact on the Company’s cash flows from operations. The aforementioned impact resulted in offsetting shifts in cash flows through net losses and working capital accounts. Revenue Recognition The Company enters into licensing and development agreements with collaborators for the development of ADCs. The terms of these agreements contain multiple deliverables/performance obligations which may include (i) licenses, or options to obtain licenses, to the Company’s ADC technology, (ii) rights to future technological improvements, (iii) research activities to be performed on behalf of the collaborative partner, (iv) delivery of cytotoxic agents, and (v) prior to the decommission of the Company’s Norwood facility in 2018, the manufacture of preclinical or clinical materials for the collaborative partner. Payments to the Company under these agreements may include upfront fees, option fees, exercise fees, payments for research activities, payments for the manufacture of preclinical or clinical materials, payments based upon the achievement of certain milestones, and royalties on product sales.
Prior to 2018, the Company identified the deliverables included within the agreement and evaluated which deliverables represented separate units of accounting based on whether certain criteria are met, including whether the delivered element had stand‑alone value to the collaborator in accordance with ASC 605. The consideration received was allocated among the separate units of accounting, and the applicable revenue recognition criteria were applied to each of the separate units.
In 2018, revenue is recognized when a 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 in accordance with ASC 606. In determining the appropriate amount of revenue to be recognized as it fulfills its obligations under the agreements, the Company performs the following steps: (i) identification of the promised goods or services in the contract; (ii) determination of whether the promised goods or services are performance obligations including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when or as the Company satisfies each performance obligation. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration to which it is entitled in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company assesses the goods or services promised within each contract and determines those that are performance obligations, and assesses whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when or as the performance obligation is satisfied. As part of the accounting for the arrangement, the Company must develop assumptions that require judgment to determine the selling price for each deliverable under ASC 605 and performance obligation under ASC 606 that were identified in the contract, which is discussed in further detail below. At December 31, 2018, the Company had the following material types of agreements with the parties identified below:
Bayer (one exclusive single-target license) Biotest (one exclusive single-target license) CytomX (one exclusive single-target license) Debiopharm (one exclusive single-compound license) Fusion Pharmaceuticals (one exclusive single-target license) Novartis (five exclusive single-target licenses) Oxford BioTherapeutics/Menarini (one exclusive single target license sublicensed from Amgen) Roche, through its Genentech unit (five exclusive single-target licenses) Sanofi (five fully-paid, exclusive single-target licenses) Takeda, through its wholly owned subsidiary, Millennium Pharmaceuticals, Inc. (one exclusive single-target license)
Jazz Pharmaceuticals
MacroGenics There are no performance, cancellation, termination, or refund provisions in any of the arrangements that contain material financial consequences to the Company. Development and Commercialization Licenses The obligations under a development and commercialization license agreement generally include the license to the Company’s ADC technology with respect to a specified antigen target, and may also include obligations related to rights to future technological improvements, research activities to be performed on behalf of the collaborative partner and the manufacture of preclinical or clinical materials for the collaborative partner.
Generally, development and commercialization licenses contain non‑refundable terms for payments and, depending on the terms of the agreement, provide that the Company will (i) at the collaborator’s request, provide research services at negotiated prices which are generally consistent with what other third parties would charge, (ii) prior to the decommissioning of the Company’s Norwood facility in 2018, at the collaborator’s request, manufacture and provide preclinical and clinical materials or deliver cytotoxic agents at negotiated prices which are generally consistent with what other third parties would charge, (iii) earn payments upon the achievement of certain milestones, and (iv) earn royalty payments, generally until the later of the last applicable patent expiration or 10 to 12 years after product launch. Royalty rates may vary over the royalty term depending on the Company’s intellectual property rights and/or the presence of comparable competing products. In the case of Sanofi, its licenses are fully-paid and no further milestones or royalties will be received. In the case of Debiopharm, no royalties will be received. The Company may provide technical assistance and share any technology improvements with its collaborators during the term of the collaboration agreements. The Company does not directly control when or whether any collaborator will request research or, achieve milestones or become liable for royalty payments. In determining the units of accounting under ASC 605, management evaluated whether the license had stand‑alone value from the undelivered elements to the collaborative partner based on the consideration of the relevant facts and circumstances for each arrangement. Factors considered in this determination include the research capabilities of the partner and the availability of ADC technology research expertise in the general marketplace. If the Company concluded that the license had stand‑alone value and therefore accounted for as a separate unit of accounting, the Company then determined the estimated selling prices of the license and all other units of accounting. In determining the performance obligations under ASC 606, management evaluates whether the license is distinct, and has significant standalone functionality, from the undelivered elements to the collaborative partner based on the consideration of the relevant facts and circumstances for each arrangement. Factors considered in this determination include the research capabilities of the partner and the availability of ADC technology research expertise in the general marketplace and whether technological improvements are required for the continued functionality of the license. If the license to the Company’s intellectual property is determined to be distinct from the other performance obligations identified in the arrangement, the Company recognizes revenues from non-refundable, up-front fees allocated to the license when the license is transferred to the customer and the customer is able to use and benefit from the license. The Company determined that the estimated selling price under ASC 605 and the stand-alone selling price under ASC 606 to be consistent. The estimates the selling prices of the license and all other deliverables under ASC 605 and performance obligations under ASC 606 are based on market conditions, similar arrangements entered into by third parties, and entity‑specific factors such as the terms of the Company’s previous collaborative agreements, recent preclinical and clinical testing results of therapeutic products that use the Company’s ADC technology, the Company’s pricing practices and pricing objectives, the likelihood that technological improvements will be made, and, if made, will be used by the Company’s collaborators and the nature of the research services to be performed on behalf of its collaborators and market rates for similar services. The Company recognizes revenue related to research services under ASC 605 and ASC 606 as the services are performed. The Company performs research activities, including developing antibody specific conjugation processes, on behalf of its collaborators and potential collaborators during the early evaluation and preclinical testing stages of drug development. The Company also develops conjugation processes for materials for later stage testing and commercialization for certain collaborators. The Company is compensated at negotiated rates that are consistent with what other third parties would charge and may receive milestone payments for developing these processes which are also recorded as a component of research and development support revenue. The Company may also produce research material for potential collaborators under material transfer agreements. The Company records amounts received for research materials produced or services performed as a component of research and development support revenue. The Company may also provide cytotoxic agents to its collaborators and previously produced preclinical and clinical materials (drug substance) at negotiated prices generally consistent with what other third parties would charge. The Company recognizes revenue on cytotoxic agents and, previously, on preclinical and clinical materials when the materials have passed all quality testing required for collaborator acceptance and control has transferred under ASC 606 to the collaborator, while ASC 605 required title and risk of loss to transfer. The majority of the Company’s costs to produce these preclinical and clinical materials were fixed and then allocated to each batch based on the number of batches produced during the period. Therefore, the Company’s costs to produce these materials were significantly affected by the number of batches produced during the period. The volume of preclinical and clinical materials the Company produced was directly related to the scale and scope of preclinical activities and the number of clinical trials the Company and its collaborators were preparing for or currently had underway, the speed of enrollment in those trials, the dosage schedule of each clinical trial and the time period such trials last. Accordingly, the volume of preclinical and clinical materials produced, and therefore the Company’s per‑batch costs to manufacture these preclinical and clinical materials, varied significantly from period to period, which affected the margins recognized on such product sales. The Company recognizes revenue related to the rights to future technological improvements under ASC 605 and ASC 606 over the estimated term of the applicable license. The Company’s development and commercialization license agreements have milestone payments which for reporting purposes are aggregated into three categories: (i) development milestones, (ii) regulatory milestones, and (iii) sales milestones. Development milestones are typically payable when a product candidate initiates or advances into different clinical trial phases. Regulatory milestones are typically payable upon submission for marketing approval with the U.S. Food and Drug Administration, or FDA, or other countries’ regulatory authorities or on receipt of actual marketing approvals for the compound or for additional indications. Sales milestones are typically payable when annual sales reach certain levels. Under ASC 605, at the inception of each agreement that includes milestone payments, the Company evaluated whether each milestone was substantive and at risk to both parties on the basis of the contingent nature of the milestone. This evaluation included an assessment of whether (a) the consideration was commensurate with either (1) the entity’s performance to achieve the milestone, or (2) the enhancement of the value of the delivered item(s) as a result of a specific outcome resulting from the entity’s performance to achieve the milestone, (b) the consideration related solely to past performance and (c) the consideration was reasonable relative to all of the deliverables and payment terms within the arrangement. The Company evaluated factors such as the scientific, regulatory, commercial and other risks that must be overcome to achieve the respective milestone, the level of effort and investment required to achieve the respective milestone and whether the milestone consideration was reasonable relative to all deliverables and payment terms in the arrangement in making this assessment. Non‑refundable development and regulatory milestones that were expected to be achieved as a result of the Company’s efforts during the period of substantial involvement were considered substantive and were recognized as revenue upon the achievement of the milestone, assuming all other revenue recognition criteria under ASC 605 were met. Milestones that were not considered substantive because the Company did not contribute effort to the achievement of such milestones were generally achieved after the period of substantial involvement and were recognized as revenue upon achievement of the milestone, as there were no undelivered elements remaining and no continuing performance obligations, assuming all other revenue recognition criteria under ASC 605 were met. Under ASC 606, at the inception of each arrangement that includes developmental and regulatory milestone payments, the Company evaluates whether the achievement of each milestone specifically relates to the Company’s efforts to satisfy a performance obligation or transfer a distinct good or service within a performance obligation. If the achievement of a milestone is considered a direct result of the Company’s efforts to satisfy a performance obligation or transfer a distinct good or service and the receipt of the payment is based upon the achievement of the milestone, the associated milestone value is allocated to that distinct good or service. If the milestone payment is not specifically related to the Company’s effort to satisfy a performance obligation or transfer a distinct good or service, the amount is allocated to all performance obligations using the relative standalone selling price method. In addition, the Company evaluates the milestone to determine whether the milestone is considered probable of being reached and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price to be allocated; otherwise, such amounts are considered constrained and excluded from the transaction price. At the end of each subsequent reporting period, the Company re-evaluates the probability of achievement of such development or regulatory milestones and any related constraint, and if necessary, adjusts its estimate of the transaction price. Any such adjustments to the transaction price are allocated to the performance obligations on the same basis as at contract inception. Amounts allocated to a satisfied performance obligation shall be recognized as revenue, or as a reduction of revenue, in the period in which the transaction price changes.
For development and commercialization license agreements that include sales-based royalties, including milestone payments based on the level of sales, and the license is deemed to be the predominant item to which the royalties relate, the Company recognizes revenue under ASC 606 at the later of (i) when the related sales occur, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied) in accordance with the royalty recognition constraint. Under the Company’s development and commercialization license agreements, except for the Sanofi and Debiopharm licenses, the Company receives royalty payments based upon its licensees’ net sales of covered products. Generally, under the development and commercialization agreements, the Company receives royalty reports and payments from its licensees approximately one quarter in arrears. The Company estimates the amount of royalty revenue to be recognized based on historical and forecasted sales and/or sales information from its licensees if available. Under ASC 605, royalty revenue was recognized when it could reliably estimate such amounts and collectability was reasonably assured. As such, the Company generally recognized revenue for sales royalties in the quarter the amounts were reported to the Company by its licensees, or one quarter following the quarter in which sales by the Company’s licensees occurred.
Collaboration and Option Agreements/Right-to-Test Agreements
The Company’s right-to-test agreements provide collaborators the right to test the Company’s ADC technology for a defined period of time through a research, or right‑to‑test, license. Under both right-to-test agreements and collaboration and option agreements, collaborators may (a) take options, for a defined period of time, to specified targets and (b) upon exercise of those options, secure or “take” licenses to develop and commercialize products for the specified targets on established terms. Under these agreements, fees may be due to the Company (i) at the inception of the arrangement (referred to as “upfront” fees or payments), (ii) upon the opt-in to acquire a development and commercialization license(s) (referred to as exercise fees or payments earned, if any, when the development and commercialization license is “taken”), (iii) at the collaborator’s request, after providing research services at negotiated prices which are generally consistent with what other third parties would charge, or (iv) some combination of all of these fees.
The accounting for collaboration and option agreements and right-to-test agreements under ASC 605 and ASC 606 is dependent on the nature of the options granted to the collaborative partner.
Under ASC 605, options are considered substantive if, at the inception of the agreement, the Company is at risk as to whether the collaborative partner will choose to exercise the options to secure development and commercialization licenses. Factors that are considered in evaluating whether options are substantive include the overall objective of the arrangement, the benefit the collaborator might obtain from the agreement without exercising the options, the cost to exercise the options relative to the total upfront consideration, and the additional financial commitments or economic penalties imposed on the collaborator as a result of exercising the options. The exercise price for non-substantive options are included in the initial consideration. In determining the units of accounting for substantive options, management evaluates whether the options have stand‑alone value from the undelivered elements to the collaborative partner based on the consideration of the relevant facts and circumstances. If the Company concludes that an option has stand‑alone value and therefore will be accounted for as a separate unit of accounting, it then determines the estimated selling prices of the option and all other units of accounting based on an option pricing model using the following inputs; a) estimated fair value of each program, b) the amount the partner would pay to exercise the option to obtain the license, c) volatility during the expected term of the option and d) risk free interest rate. A risk adjusted discounted cash flow model is then used to estimate the fair value of the option with volatility determined using the stock prices of comparable companies. The cash flow is discounted at a rate representing the Company’s estimate of its cost of capital at the time.
Under ASC 606, options are considered distinct performance obligations if they provide a collaborator with a material right. Factors that are considered in evaluating whether options convey a material right include the overall objective of the arrangement, the benefit the collaborator might obtain from the agreement without exercising the options, the cost to exercise the options relative to the fair value of the licenses, and the additional financial commitments or economic penalties imposed on the collaborator as a result of exercising the options. As of December 31, 2018, all right-to-test agreements have expired.
If the Company concludes that an option provides the customer a material right, and therefore is a separate performance obligation, the Company then determines the estimated selling prices of the option and all other units of accounting using the following inputs: a) estimated fair value of each program, b) the amount the partner would pay to exercise the option to obtain the license and c) probability of exercise. The Company does not control when or if any collaborator will exercise its options for development and commercialization licenses. As a result, the Company cannot predict when or if it will recognize revenues in connection with any of the foregoing.
Upfront payments on development and commercialization licenses may be recognized upon delivery of the license if facts and circumstances dictate that the license has stand-alone functionality and is distinct from the undelivered elements. In determining whether a collaboration and option agreement is within the scope of ASC 808, Collaborative Arrangements, management evaluates the level of involvement of both companies in the development and commercialization of the products to determine if both parties are active participants and if both parties are exposed to risks and rewards dependent on the commercial success of the licensed products. If the agreement is determined to be within the scope of ASC 808, the Company will segregate the research and development activities and the related cost sharing arrangement. Payments made by the Company for such activities will be recorded as research and development expense and reimbursements received from its partner will be recognized as an offset to research and development expense.
Transaction Price Allocated to Future Performance Obligations
Remaining performance obligations under ASC 606 represent the transaction price of contracts for which work has not been performed (or has been partially performed) and includes unexercised contract options that are considered material rights. As of December 31, 2018, the aggregate amount of the transaction price allocated to remaining performance obligations comprising deferred revenue was $80.8 million. The Company expects to recognize revenue on approximately .4%, 1.6%, and 98% of the remaining performance obligations over the next 12 months, 13 to 60 months, and 61 to 120 months, respectively, however it does not control when or if any collaborator will exercise its options for, or terminate existing development and commercialization licenses. Contract Balances from Contracts with Customers
The following table presents changes in the Company’s contract assets and contract liabilities during the year ended December 31, 2018 (in thousands):
During the year ended December 31, 2018, the Company recognized the following revenues as a result of changes in contract asset and contract liability balances in the respective periods (in thousands):
As a result of adoption of ASC 606, a contract asset of $5 million was recorded for a probable milestone which was subsequently earned and paid during the year ended December 31, 2018. During 2018, a milestone from Fusion was deemed probable, and accordingly, a contract asset was created in the amount of $500,000. In December 2018, the Company recorded a $1 million development milestone earned under a sublicense agreement with Oxford BioTherapeutics Ltd. as revenue, which is included in accounts receivable as of December 31, 2018. Also, as a result of Takeda not executing a second license it had available, or extending or expanding its right-to-test agreement, the Company recognized $10.9 million of revenue previously deferred, with a net reduction in deferred revenue of $5.9 million due to contract asset and contract liability netting. In addition, $750,000 of the deferred revenue balance at December 31, 2017 was recognized as revenue during the year ended December 31, 2018 upon completion of the Debiopharm and another collaborator’s performance obligations, $2.1 million of amortization of deferred revenue was recorded related to numerous collaborators’ rights to technological improvements and $335,000 of deferred revenue was recognized upon shipment of clinical materials to a partner and is included in clinical material revenue. The timing of revenue recognition, billings, and cash collections results in billed receivables, contract assets, and contract liabilities on the consolidated balance sheets. When consideration is received, or such consideration is unconditionally due, from a customer prior to transferring goods or services to the customer under the terms of a contract, a contract liability is recorded. Contract liabilities are recognized as revenue after control of the products or services is transferred to the customer and all revenue recognition criteria have been met.
Financial Instruments and Concentration of Credit Risk Cash and cash equivalents are primarily maintained with three financial institutions in the U.S. Deposits with banks may exceed the amount of insurance provided on such deposits. Generally, these deposits may be redeemed upon demand and, therefore, bear minimal risk. The Company’s cash equivalents consist of money market funds with underlying investments primarily being U.S. Government‑issued securities and high quality, short‑term commercial paper. Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash, cash equivalents, and marketable securities. The Company held no marketable securities as of December 31, 2018 or 2017. The Company’s investment policy, approved by the Board of Directors, limits the amount it may invest in any one type of investment, thereby reducing credit risk concentrations. Cash and Cash Equivalents All highly liquid financial instruments with maturities of three months or less when purchased are considered cash equivalents. As of December 31, 2018 and 2017, the Company held $262.3 million and $267.1 million, respectively, in cash and money market funds consisting principally of U.S. Government-issued securities and high quality, short-term commercial paper which were classified as cash and cash equivalents. Non-cash Investing Activities The Company had $715,000 and $482,000 of accrued capital expenditures as of December 31, 2018 and 2017 which have been treated as a non-cash investing activity and, accordingly, are not reflected in the consolidated statement of cash flows. Fair Value of Financial Instruments ASC Topic 820 defines fair value, establishes a framework for measuring fair value in accordance with accounting principles generally accepted in the U.S., and expands disclosures about fair value measurements. Fair value is defined under ASC Topic 820 as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The standard describes a hierarchy to measure fair value which is based on three levels of inputs, of which the first two are considered observable and the last unobservable, as follows:
As of December 31, 2018, the Company held certain assets that are required to be measured at fair value on a recurring basis. The following table represents the fair value hierarchy for the Company’s financial assets measured at fair value on a recurring basis as of December 31, 2018 (in thousands):
As of December 31, 2017, the Company held certain assets that are required to be measured at fair value on a recurring basis. The following table represents the fair value hierarchy for the Company’s financial assets measured at fair value on a recurring basis as of December 31, 2017 (in thousands):
The fair value of the Company’s cash equivalents is based primarily on quoted prices from active markets. The carrying amounts reflected in the consolidated balance sheets for accounts receivable, unbilled revenue, prepaid and other current assets, accounts payable, accrued compensation, and other accrued liabilities approximate fair value due to their short‑term nature. The gross carrying amount and estimated fair value of the convertible 4.5% senior notes was $2.1 million and $2.8 million, respectively, as of December 31, 2018 compared to $2.1 million and $3.8 million, respectively, as of December 31, 2017. In the second half of 2017, $97.9 million of convertible debt outstanding was converted to 26,160,187 shares of the Company’s common stock causing the decrease in the gross carrying amount. The estimated fair value per $1,000 note on the debt remaining as of December 31, 2018 decreased compared to December 31, 2017 due primarily to a decrease in the Company’s stock price. The fair value of the Convertible Notes is influenced by interest rates, the Company’s stock price and stock price volatility and is determined by prices for the Convertible Notes observed in a market which is a Level 2 input for fair value purposes due to the low frequency of trades. Inventory Inventory costs relate to clinical trial materials being manufactured for sale to the Company’s collaborators. Inventory is stated at the lower of cost or net realizable value as determined on a first‑in, first‑out (FIFO) basis.
Inventory at December 31, 2018 and 2017 is summarized below (in thousands):
In February 2018, the Company made the decision to implement a new operating model that will rely on external manufacturing and quality testing for drug substance and drug product for its internal development programs, and would discontinue providing such services to its collaborators. The implementation of this new operating model led to the ramp-down and ultimate discontinuation of manufacturing and quality activities at the Company’s Norwood, Massachusetts facility during 2018, and accordingly, there was no inventory on-hand as of December 31, 2018. Raw materials inventory historically consisted entirely of proprietary cell‑killing agents the Company developed as part of its ADC technology. Work in process inventory at December 31, 2017 consisted of drug substance manufactured for sale to the Company’s collaborators to be used in preclinical and clinical studies. All conjugate was made to order at the request of the collaborators and subject to the terms and conditions of respective supply agreements. Based on historical reprocessing or reimbursement required for drug substance that did not meet specification and the status of conjugate on hand or conjugate shipped to collaborators but not yet released per the terms of the respective supply agreements, no reserve for work in process inventory was determined to be required at December 31, 2017. The Company’s costs to manufacture conjugate on behalf of its partners are greater than the supply prices charged to partners, and therefore costs are capitalized into inventory at the supply prices which represent net realizable value. Raw materials inventory cost is stated net of a $1.1 million write-down as of December 31, 2017. The write‑down represents the cost of raw materials that the Company considers to be in excess of a twelve‑month supply based on firm, fixed orders and projections from its collaborators as of the respective balance sheet date. The Company produced preclinical and clinical materials for its collaborators either in anticipation of or in support of preclinical studies and clinical trials, or for process development and analytical purposes. Under the terms of supply agreements with its collaborators, the Company generally received rolling six‑month firm, fixed orders for conjugate that the Company was required to manufacture, and rolling twelve‑month manufacturing projections for the quantity of conjugate the collaborator expected to need in any given twelve‑month period. The amount of clinical material produced was directly related to the number of collaborator anticipated or on‑going clinical trials for which the Company was producing clinical material, the speed of enrollment in those trials, the dosage schedule of each clinical trial and the time period, if any, during which patients in the trial receive clinical benefit from the clinical materials. Because these elements are difficult to estimate over the course of a trial, substantial differences between collaborators’ actual manufacturing orders and their projections could result in the Company’s usage of raw materials varying significantly from estimated usage at an earlier reporting period. To the extent that a collaborator had provided the Company with a firm, fixed order, the collaborator was required by contract to reimburse the Company the full negotiated price of the conjugate, even if the collaborator subsequently canceled the manufacturing run. The Company capitalized raw material as inventory upon receipt and accounted for the raw material inventory as follows:
During the year ended December 31, 2017, the six month transition period ended December 31, 2016 and fiscal year 2016, the Company obtained additional amounts of its cell-killing agents DMx from its supplier which yielded more material than would be required by the Company’s collaborators over the next twelve months, and as a result, the Company recorded $403,000, $150,000, and $1.1 million, respectively, of charges to research and development expense related to raw material inventory identified as excess. There were no such excess charges during 2018. Unbilled Revenue Unbilled revenue substantially represents research funding earned based on actual resources utilized under the Company’s various collaborator agreements. Clinical Trial Accruals Clinical trial expenses are a significant component of research and development expenses, and the Company outsources a significant portion of these costs to third parties. Third party clinical trial expenses include investigator fees, site costs (patient cost), clinical research organization costs, and costs for central laboratory testing and data management. The accrual for site and patient costs includes inputs such as estimates of patient enrollment, patient cycles incurred, clinical site activations, and other pass-through cost. These inputs are required to be estimated due to a lag in receiving the actual clinical information from third parties. Payments for these activities are based on the terms of the individual arrangements, which may differ from the pattern of costs incurred, and are reflected on the consolidated balance sheets as prepaid asset or accrued clinical trial cost. These third party agreements are generally cancelable, and related costs are recorded as research and development expenses as incurred. Non-refundable advance clinical payments for goods or services that will be used or rendered for future R&D activities recorded as a prepaid asset and recognized as expense as the related goods are delivered or the related services are performed. The Company also records accruals for estimated ongoing clinical research and development costs. When evaluating the adequacy of the accrued liabilities, the Company analyzes progress of the studies, including the phase or completion of events, invoices received and contracted costs. Significant judgments and estimates may be made in determining the accrued balances at the end of any reporting period. Actual results could differ from the estimates made by the Company. The historical clinical accrual estimates made by the Company have not been materially different from the actual costs.
Other Accrued Liabilities Other accrued liabilities consisted of the following at December 31, 2018 and 2017 (in thousands):
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