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Income Taxes (Tables)

12 Months Ended

Dec. 31, 2019

Income Taxes [Abstract]

Income (Loss) Before Income Taxes

Income (loss) before income taxes is comprised of (in thousands):

		Year Ended December 31,
		2019				2018				2017
United States		$	344,280			$	(69,576	)		$	(5,289	)
Foreign			2,489				(6,580	)			(11,474	)
Income (loss) before income taxes		$	346,769			$	(76,156	)		$	(16,763	)

Income Tax Expense (Benefit)

Our income tax expense (benefit) was as follows (in thousands):

		Year Ended December 31,
		2019				2018				2017
Current:
Federal		$	35,861			$	438			$	(7,460	)
State			14,329				(1,442	)			1,246
Foreign			413				374				234
Total current income tax expense (benefit)			50,603				(630	)			(5,980	)
Deferred:
Federal			(7,096	)			(290,511	)			—
State			—				—				—
Total deferred income tax benefit			(7,096	)			(290,511	)			—
Total income tax expense (benefit)		$	43,507			$	(291,141	)		$	(5,980	)

Reconciliation of Statutory to Effective Tax Rate

Our expense (benefit) for income taxes differs from the amount computed by applying the U.S. federal statutory rate to income (loss) before taxes. The sources and tax effects of the differences are as follows (in thousands):

		Year Ended December 31,
		2019								2018								2017
Pre-tax income (loss)		$	346,769							$	(76,156	)						$	(16,763	)
Statutory rate			72,822				21.0	%			(15,993	)			21.0	%			(5,867	)			35.0	%
State income tax net of federal benefit			49,119				14.2	%			(2,202	)			2.9	%			820				(4.9	)%
Foreign			340				0.1	%			1,735				(2.3	)%			4,299				(25.6	)%
Net change in valuation allowance			(37,765	)			(10.9	)%			(277,924	)			364.9	%			(86,296	)			514.8	%
Net operating loss expiration			—				0.0	%			8,864				(11.6	)%			3,987				(23.8	)%
TEGSEDI licensing gain			—				0.0	%			59,583				(78.2	)%			—				0.0	%
Impact from outside basis differences			(16,344	)			(4.7	)%			—				0.0	%			—				0.0	%
Tax credits			(22,296	)			(6.4	)%			(73,362	)			96.3	%			(32,769	)			195.5	%
Deferred tax true-up			646				0.2	%			9,947				(13.1	)%			4,848				(28.9	)%
Tax rate change			1,811				0.5	%			(1,808	)			2.4	%			114,832				(685.0	)%
Non-deductible compensation			3,361				1.0	%			3,154				(4.1	)%			1,575				(9.4	)%
Other non-deductible items			329				0.1	%			(569	)			0.7	%			2,548				(15.2	)%
Akcea deconsolidation adjustment at IPO			—				0.0	%			—				0.0	%			469				(2.8	)%
Stock-based compensation			(4,837	)			(1.4	)%			(4,199	)			5.5	%			(14,337	)			85.5	%
Foreign-derived intangible income benefit			(2,071	)			(0.6	)%			—				0.0	%			—				0.0	%
Other			(1,608	)			(0.5	)%			1,633				(2.1	)%			(89	)			0.5	%
Effective rate		$	43,507				12.6	%		$	(291,141	)			382.3	%		$	(5,980	)			35.7	%

Deferred Tax Assets and Liabilities

Significant components of our deferred tax assets and liabilities as of December 31, 2019 and 2018 are as follows (in thousands):

		Year Ended December 31,
		2019				2018
Deferred Tax Assets:
Net operating loss carryovers		$	20,191			$	89,717
R&D credits			210,455				313,652
Deferred revenue			127,763				27,381
Stock-based compensation			65,703				61,027
Intangible and capital assets			77,861				49,007
Other			12,510				8,275
Total deferred tax assets		$	514,483			$	549,059
Deferred Tax Liabilities:
Convertible debt		$	(6,110	)		$	(24,018	)
Fixed assets			(1,958	)			—
Other			(3,884	)			—
Net deferred tax asset		$	502,531			$	525,041
Valuation allowance			(196,974	)			(234,245	)
Total net deferred tax assets and liabilities		$	305,557			$	290,796

Gross Unrecognized Tax Benefits

The following table summarizes our gross unrecognized tax benefits (in thousands):

		Year Ended December 31,
		2019				2018				2017
Beginning balance of unrecognized tax benefits		$	68,301			$	78,014			$	66,999
Decrease for prior period tax positions			(867	)			(12,814	)			—
Increase for prior period tax positions			736				—				1,520
Increase for current period tax positions			1,614				3,101				9,495
Ending balance of unrecognized tax benefits		$	69,784			$	68,301			$	78,014

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Tabular disclosure of the components of income tax expense attributable to continuing operations for each year presented including, but not limited to: current tax expense (benefit), deferred tax expense (benefit), investment tax credits, government grants, the benefits of operating loss carryforwards, tax expense that results from allocating certain tax benefits either directly to contributed capital or to reduce goodwill or other noncurrent intangible assets of an acquired entity, adjustments of a deferred tax liability or asset for enacted changes in tax laws or rates or a change in the tax status of the entity, and adjustments of the beginning-of-the-year balances of a valuation allowance because of a change in circumstances that causes a change in judgment about the realizability of the related deferred tax asset in future years.

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Tabular disclosure of the reconciliation using percentage or dollar amounts of the reported amount of income tax expense attributable to continuing operations for the year to the amount of income tax expense that would result from applying domestic federal statutory tax rates to pretax income from continuing operations.

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