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Income Taxes | 12 Months Ended
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Dec. 31, 2020
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes Loss before provision for (benefit from) income taxes for the years ended December 31, 2020, 2019 and 2018 consist of the following (in thousands):
| Years Ended December 31,
| 2020 |  | 2019 |  | 2018
United States | $ | (745,445) |  |  | $ | (508,595) |  |  | $ | (380,473) |
Foreign | 932 |  |  | (6,121) |  |  | (3,935) |
Loss before provision for (benefit from) income taxes | $ | (744,513) |  |  | $ | (514,716) |  |  | $ | (384,408) |
The provision for (benefit from) income taxes for the years ended December 31, 2020, 2019 and 2018 consist of the following components (in thousands):
| Years Ended December 31,
| 2020 |  | 2019 |  | 2018
Current: |  |  |  |  |
Federal | $ | — |  |  | $ | — |  |  | $ | (26) |
State | 32 |  |  | 505 |  |  | 352 |
Foreign | 2,519 |  |  | — |  |  | — |
Total current | 2,551 |  |  | 505 |  |  | 326 |
Deferred: |  |  |  |  |
Federal | — |  |  | (1,200) |  |  | — |
Total deferred | — |  |  | (1,200) |  |  | — |
Total provision for (benefit from) income taxes | $ | 2,551 |  |  | $ | (695) |  |  | $ | 326 |
The reconciliation of the U.S. statutory income tax rate to our effective tax rate for the years ended December 31, 2020, 2019 and 2018 are as follows:
| Years Ended December 31,
| 2020 |  | 2019 |  | 2018
Tax effected at statutory rate | 21.0 | % |  | 21.0 | % |  | 21.0 | %
State taxes, net of federal benefit | 3.6 | % |  | 7.9 | % |  | 6.3 | %
Non-deductible items | (0.8) | % |  | 1.6 | % |  | — | %
Change in valuation allowance | (47.4) | % |  | (33.0) | % |  | (28.5) | %
Federal research and development credits | 3.8 | % |  | 2.5 | % |  | 1.5 | %
Foreign tax rate differential | 0.0 | % |  | (0.2) | % |  | (0.2) | %
Stock compensation windfall | 19.8 | % |  | — | % |  | — | %
Other | (0.3) | % |  | 0.2 | % |  | (0.2) | %
Effective tax rate | (0.3) | % |  | 0.0 | % |  | (0.1) | %
The significant components of our deferred tax assets and tax liabilities as of December 31, 2020 and 2019 are as follows (in thousands):
| December 31,
| 2020 |  | 2019
Deferred tax assets: |  |  |
Net operating loss carry-forwards | $ | 587,211 |  |  | $ | 268,173 |
Stock-based compensation | 33,089 |  |  | 43,978 |
Capitalized licenses, research and development and start-up costs | 13,985 |  |  | 19,891 |
Tax credit carry-forwards | 99,024 |  |  | 77,222 |
Accrued expenses | 26,962 |  |  | 7,377 |
Deferred revenue | 29,785 |  |  | 53,475 |
Operating lease liabilities | 22,313 |  |  | 26,571 |
Lease financing obligation | 23,718 |  |  | 10,570 |
Capitalized inventory | 38,058 |  |  | — |
Other | — |  |  | 11 |
Total gross deferred tax assets | 874,145 |  |  | 507,268 |
Less: valuation allowance | (823,468) |  |  | (470,753) |
Total deferred tax assets, net of valuation allowance | 50,677 |  |  | 36,515 |
Deferred tax liabilities: |  |  |
Financing right-of-use assets | (11,539) |  |  | (2,612) |
Operating right-of-use assets | (20,349) |  |  | (24,944) |
Fixed assets | (18,276) |  |  | (8,959) |
Other | (513) |  |  | — |
Total deferred tax liabilities | (50,677) |  |  | (36,515) |
Net deferred tax assets | $ | — |  |  | $ | — |
We have evaluated the positive and negative evidence bearing upon the realization of our deferred tax assets, including our history of significant losses in every year since our inception and in accordance with the applicable accounting standards, have fully reserved the net deferred tax asset. We concluded that realization of our net deferred tax assets is not more-likely-than-not to be realized as of December 31, 2020. The valuation allowance increased by $352.7 million in the year ended December 31, 2020, primarily due to the increase in net operating loss carry-forwards, research and development tax credits and capitalized inventory. On a periodic basis, we reassess the valuation allowance on our deferred income tax assets, weighing positive and negative evidence to assess the recoverability of the deferred tax assets. In 2020, we reassessed the valuation allowance and considered negative evidence, including our cumulative losses over the three years ended December 31, 2020, and positive evidence, including our recent EUA for our COVID-19 vaccine. After assessing both the negative and positive evidence, we concluded that we should maintain the valuation allowance on our net operating losses and our other deferred tax assets as of December 31, 2020. The release of the valuation allowance, as well as the exact timing and the amount of such release, continue to be subject to, among other things, our level of profitability, revenue growth, clinical program progression and expectations regarding future profitability. Our total deferred tax asset balance subject to the valuation allowance was approximately $874.1 million at December 31, 2020. We will continue to monitor the need for a full or partial valuation allowance each quarter in 2021 and future periods. At December 31, 2020, we had approximately $2.26 billion and $1.70 billion of federal and state net operating loss carry-forwards, respectively, of which $380.1 million of federal and $1.70 billion of state loss carry-forwards begin to expire in 2030. Additionally, $1.88 billion of federal net operating loss carry-forward will carry forward indefinitely. At December 31, 2020 we also had federal and state research and development credit carry-forwards of approximately $73.3 million and $26.1 million, which begin to expire in 2030 and 2032, respectively. At December 31, 2020, we also had federal orphan drug and state investment tax credit carry-forwards of approximately $2.0 million and $3.9 million which begin to expire in 2039 and 2021, respectively. In March 2020, the Coronavirus Aid, Relief and Economic Security Act (the CARES Act) was signed into law. The CARES Act includes provisions relating to several aspects of corporate income taxes. We do not currently expect the CARES Act to have a significant impact on our provision for income taxes; however, we will continue to monitor the provisions of the CARES Act in relation to its operations. Utilization of the net operating loss (NOL) and tax credit carry-forwards may be subject to a substantial annual limitation due to ownership change limitations that have occurred previously, or that could occur in the future, as provided by Section 382 of the Internal Revenue Code of 1986, as amended, or Section 382, as well as similar state provisions and other provisions of the Internal Revenue Code. Ownership changes may limit the amount of NOLs and tax credit carry-forwards that can be utilized annually to offset future taxable income and tax, respectively. In general, an ownership change, as defined by Section 382, results from transactions that increase the ownership of 5% shareholders in the stock of a corporation by more than 50% in the aggregate over a three-year period. We may experience ownership changes in the future as a result of subsequent shifts in our stock ownership, some of which may be outside our control. We file U.S. federal income tax returns and income tax returns in various state, local and foreign jurisdictions. All tax years since the date of our incorporation remain open to examination by the major taxing jurisdictions (state and federal) to which we are subject, as carry-forward attributes generated in years past may still be adjusted upon examination by the Internal Revenue Service (IRS) or other authorities if they have or will be used in a future period. We are not currently under examination by the IRS, or any other jurisdictions, for any tax year. We recognize, in our financial statements, the effect of a tax position when it is more likely than not, based on the technical merits, that the position will be sustained upon examination. A reconciliation of the beginning and ending amounts of unrecognized tax benefits during the years ended December 31, 2020 and 2019 are as follows (in thousands):
Balance as of December 31, 2018 | $ | 141 |
Decrease due to prior positions | — |
Increase due to current year tax position | — |
Balance as of December 31, 2019 | 141 |
Decrease due to prior positions | — |
Increase due to current year tax positions | — |
Balance as of December 31, 2020 | $ | 141 |
Unrecognized tax benefits may change during the next twelve months for items that arise in the ordinary course of business. We do not anticipate a material change to our unrecognized tax benefits over the next twelve months that would have an adverse effect on our consolidated operating results. We recognize interest and penalties, if applicable, related to uncertain tax positions as a component of income tax expense.

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- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 21 -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32857-109319 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -URI http://asc.fasb.org/extlink&oid=116825942&loc=d3e330215-122817 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 17 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32809-109319 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -URI http://asc.fasb.org/extlink&oid=116825942&loc=d3e330036-122817 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 14 -URI http://asc.fasb.org/extlink&oid=84230637&loc=d3e32705-109319 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 270 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 30 -Section 50 -Paragraph 2 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331 + Details
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