XML 35 R20.htm IDEA: XBRL DOCUMENT
v3.24.0.1

Income taxes | 12 Months Ended
--- | ---
Dec. 31, 2023
Income Tax Disclosure [Abstract] |
Income taxes | 13. Income taxes The loss from operations before tax benefit (expense) consisted of the following for the years ended December 31, 2023, 2022, and 2021: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | 2023 |  | 2022 |  | 2021
Domestic | ​ | $ | (784,744) | ​ | $ | (591,126) | ​ | $ | (487,726)
Foreign | ​ |  | 88,634 | ​ |  | 3,639 | ​ |  | (30,614)
Total | ​ | $ | (696,110) | ​ | $ | (587,487) | ​ | $ | (518,340)
​ The Income Tax Provision consisted of the following for the years ended December 31, 2023, 2022 and 2021: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | 2023 |  | 2022 |  | 2021
Current: |  | ​ |  |  | ​ |  |  | ​ |
U.S. Federal | ​ | $ | — | ​ | $ | — | ​ | $ | —
U.S. State and Local | ​ |  | 27,226 | ​ |  | (4,224) | ​ |  | (3,844)
Foreign | ​ |  | (4,003) | ​ |  | (1,582) | ​ |  | (1,340)
Deferred: | ​ |  | ​ | ​ |  | ​ | ​ |  |
U.S. Federal | ​ |  | 36,408 | ​ |  | 23,689 | ​ |  | —
U.S. State and Local | ​ |  | 10,521 | ​ |  | 10,587 | ​ |  | (377)
Foreign | ​ |  | (646) | ​ |  | — | ​ |  | —
Total tax benefit (expense) | ​ | $ | 69,506 | ​ | $ | 28,470 | ​ | $ | (5,561)
​ A reconciliation of the U.S. statutory income tax rate to the Company’s effective tax rate is as follows: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | December 31, |
​ |  | 2023 |  | 2022 |  | 2021 |
Federal income tax provision at statutory rate | ​ | 21.00 | % | 21.00 | % | 21.00 | %
State income tax provision, net of federal benefit | ​ | 0.32 |  | 3.07 |  | (0.74) |
Permanent differences | ​ | (1.43) |  | (1.83) |  | (4.06) |
Research and development | ​ | 4.59 |  | 5.89 |  | 4.50 |
Change in valuation allowances | ​ | (16.86) |  | (23.36) |  | (29.03) |
Change in deferred tax assets | ​ | — |  | (0.10) |  | 12.05 |
Foreign tax rate differential | ​ | 0.05 |  | (0.17) |  | 0.01 |
Tax rate change | ​ | (1.26) |  | 0.34 |  | 0.01 |
Release (Accrual) of uncertain tax positions | ​ | 3.71 | ​ | — | ​ | (4.78) | ​
Other | ​ | (0.12) |  | — |  | (0.03) |
Effective income tax rate | ​ | 10.00 | % | 4.84 | % | (1.07) | %
​ Accounting for income taxes under U.S. GAAP requires that individual tax-paying entities of the company offset all deferred tax liabilities and assets within each particular tax jurisdiction and present them as a noncurrent deferred tax liability or asset. Amounts in different tax jurisdictions cannot be offset against each other. The noncurrent deferred income tax asset is recorded within deposits and other assets on the balance sheet. The amount of deferred income taxes are as follows: ​
​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | December 31,
​ | ​ | 2023 |  | 2022
Assets: |  | ​ |  |  | ​ |
Noncurrent deferred income taxes | ​ | $ | — | ​ | $ | —
Liabilities: | ​ |  |  | ​ |  |
Noncurrent deferred income taxes | ​ |  | (55,905) | ​ |  | (102,834)
Deferred income taxes - net | ​ | $ | (55,905) | ​ | $ | (102,834)
​ The significant components of the Company’s deferred tax assets and liabilities at December 31, 2023 and 2022 are as follows: ​
​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | 2023 |  | 2022
Deferred tax assets: |  | ​ |  |  | ​ |
Accrued expense | ​ | $ | 25,400 | ​ | $ | 2,124
Amortization | ​ |  | 137,808 | ​ |  | 52,532
Federal tax credits | ​ |  | 205,485 | ​ |  | 174,802
State tax credits | ​ |  | 9,817 | ​ |  | 9,787
Federal net operating losses | ​ |  | 60,270 | ​ |  | 69,957
State net operating losses | ​ |  | 18,680 | ​ |  | 10,316
Foreign net operating losses | ​ |  | 4,052 | ​ |  | 4,837
Capitalized research and development costs | ​ |  | 149,683 | ​ |  | 110,219
Share based compensation and other | ​ |  | 30,757 | ​ |  | 27,054
Liability for sale of future royalties | ​ | ​ | 190,659 | ​ | ​ | 185,589
Noncash interest expense | ​ | ​ | 9,410 | ​ | ​ | 30,160
Other comprehensive loss | ​ |  | (728) | ​ |  | (719)
Total gross deferred tax assets | ​ |  | 841,293 | ​ |  | 676,658
Less valuation allowance | ​ |  | (833,810) | ​ |  | (672,172)
Total deferred tax assets, net of valuation allowance | ​ | $ | 7,483 | ​ | $ | 4,486
Deferred tax liabilities: | ​ |  |  | ​ |  |
Depreciation | ​ | $ | (7,483) | ​ | $ | (4,486)
Indefinite lived intangible | ​ |  | (55,905) | ​ |  | (102,834)
Total gross deferred tax liabilities | ​ |  | (63,388) | ​ |  | (107,320)
Net deferred tax assets (liabilities) | ​ | $ | (55,905) | ​ | $ | (102,834)
​ For the year ended December 31, 2023, the Company generated taxable income in the U.S. of $102.5 million. The Company has not recorded any federal income tax provision after considering the federal NOL, section 250 deduction, available general business credits, and foreign tax credits. The Company recorded a state income tax benefit of $27.2 million which is primarily attributable to the receipt of an outstanding state tax refund received during the year ended December 31, 2023, and the subsequent release of the associated ASC 740 income tax reserve. At December 31, 2023 and 2022, the Company recorded a valuation allowance against its net deferred tax assets of $833.8 million and $672.2 million, respectively. The change in the valuation allowance during the years ended December 31, 2023 and 2022 was $161.6 million and $146.6 million, respectively. A valuation allowance has been recorded since, in the judgment of management, these assets are not more likely than not to be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during periods in which those temporary differences and carryforwards become deductible or are utilized. As of December 31, 2023, the Company had $287.0 million, $208.8 million, and $12.1 million of federal, state, and foreign net operating loss carryforwards, respectively. The Company recorded a deferred tax liability in conjunction with the Agilis Merger of $122.0 million in 2018, related to the tax basis difference in the IPRD indefinite-lived intangibles acquired. The Company’s policy is to record a deferred tax liability related to acquired IPR&D which may eventually be realized either upon amortization of the asset when the research is completed, and a product is successfully launched or the write-off of the asset if it is abandoned or unsuccessful. In July 2022, the Company received EMEA approval for a portion of the IPR&D assets, and thus, began the amortization of the intangible. In May 2023, as part of a strategic portfolio prioritization, the Company announced the discontinuation of its preclinical and early research programs in gene therapy, which included programs for Friedreich ataxia and Angelman syndrome. In conjunction with the announcement, the Company recorded an impairment to its indefinite-lived intangible for IP research and development relating to the Friedreich ataxia and Angelman syndrome gene therapy assets. As a result of the impairment, the Company recorded a deferred tax benefit during the 2023 tax year. As of December 31, 2023, research and development credit carryforward for federal purposes is $35.9 million. In addition, the Orphan Drug Credit Carryover available as of December 31, 2023 is $169.6 million. The Company had research and development carryforwards expiring of $0.6 million in 2023, with additional expiration in 2024 and onwards if not otherwise utilized as projected. The income tax benefit (expense) for the years ended December 31, 2023 and 2022 differed from the amounts computed by applying the U.S. federal income tax rate of 21% to loss before tax expense as a result of the IPR&D assets becoming partially amortizable in 2022, foreign taxes, the impact of temporary difference, including the updated section 174, the impact of permanent differences, including “global intangible low-taxed income” (“GILTI”), tax credits generated, true up of net operating loss carryforwards, and increase in the Company’s valuation allowance. Under the 2017 Tax Cuts and Jobs Act, the ability to currently deduct qualifying research and experimental costs under section 174, as well as software development costs, are eliminated for tax years beginning after December 31, 2021. Under the new rule, these costs must be capitalized and amortized over a five-year or fifteen-year period, depending on whether the research is conducted in the U.S. or abroad, respectively. The rule resulted in an increased current taxable income of the Company by $300.3 million for the tax year ended December 31, 2023. The Company applies the elements of FASB ASC 740-10 regarding accounting for uncertainty in income taxes. This clarifies the accounting for uncertainty in income taxes recognized in financial statements and required impact of a tax position to be recognized in the financial statements if that position is more likely than not of being sustained by the taxing authority. As of December 31, 2023, the Company recorded unrecognized tax benefits in the amount of $1.4 million including interest and penalties through 2023. The Company’s policy is to recognize interest and penalties related to tax matters within the income tax provision. Tax years beginning in 2014 are generally subject to examination by taxing authorities, although net operating losses from all years are subject to examinations and adjustments for at least three years following the year in which the attributes are used. The Company is currently under a wage tax audit in Germany for tax years 2018 through 2021. Although the outcome of tax audits is always uncertain, the company does not expect any adjustment to result for these years as of December 31, 2023. For all years through December 31, 2016, the Company generated research credits but has not conducted a study to document the qualified activities. This study may result in an adjustment to the Company’s research and development credit carryforwards; however, until a study is completed and any adjustment is known, no amounts are being presented as an uncertain tax position. A full valuation allowance has been provided against the Company’s research and development credits and, if an adjustment is required, this adjustment would be offset by an adjustment to the deferred tax asset established for the research and development credit carryforwards and the valuation allowance. As a result of U.S. tax reform legislation, distributions of profits from non-U.S. subsidiaries are not expected to cause a significant incremental U.S. tax impact in the future. However, distributions may be subject to non-U.S. withholding taxes if profits are distributed from certain jurisdictions. As of December 31, 2023, for purposes of ASC 740-10-25-3, the Company had $345.9 million of undistributed earnings from non-U.S. subsidiaries that it intends to reinvest permanently in its non-U.S. operations. As these ASC 740-10-25-3 earnings are considered permanently reinvested, no tax provision has been accrued. It is not feasible to estimate the amount of tax that might be payable on the eventual remittance of such earnings. Unrecognized Tax Benefits A reconciliation of the gross amount of unrecognized tax benefits, excluding accrued interest and penalties, is as follows:
​ | ​ | ​
​ | Unrecognized Tax Benefits
Balance at December 31, 2022 | ​ | 27,217
Reductions based on settlements or expiration of statute of limitations |  | (24,671)
Interest received | ​ | (1,186)
Balance at December 31, 2023 | $ | 1,360
​ Uncertain tax positions, for which management’s assessment is that there is a more than 50% probability of sustaining the position upon challenge by a taxing authority based upon its technical merits, are subject to certain recognition and measurement criteria. The nature of the uncertain tax positions is often very complex and subject to change, and the amounts at issue can be substantial. The Company develops its cumulative probability assessment of the measurement of uncertain tax positions using internal experience, judgment, and assistance from professional advisors. The Company re-evaluates these uncertain tax positions on a quarterly basis based on a number of factors including, but not limited to, changes in facts or circumstances, changes in tax law, and effectively settled issues under audit and new audit activity. Any change in these factors could result in the recognition of a tax benefit or an additional charge to the tax provision. The Company records penalties and tax-related interest expense on unrecognized tax benefits as a component of the provision for income taxes in the accompanying consolidated statement of operations. The Company has not recorded any interest and penalties related to uncertain tax positions for the year ended December 31, 2023, in the accompanying consolidated balance sheet. Future changes in the Company’s unrecognized tax benefits will affect the Company’s annual effective tax rate.

X
- References No definition available. + Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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 -Topic 946 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Publisher FASB -URI https://asc.fasb.org//1943274/2147480990/946-20-50-13 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//740/tableOfContent Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 14 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-14 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-21 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 270 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482526/740-270-50-1 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 17 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-17 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479360/740-10-S99-1 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479360/740-10-S99-2 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 30 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482603/740-30-50-2 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration