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Revenue recognition
 12 Months Ended
Dec. 31, 2023
Revenue from Contract with Customer [Abstract]  
Revenue recognition

12. Revenue recognition

Net product sales

During the years ended December 31, 2023, 2022, and 2021, net product sales in the United States were $255.1 million, $218.3 million, and $187.3 million, respectively, consisting solely of sales of Emflaza, and net product sales outside of the United States were $406.1 million, $316.9 million, and $241.6 million respectively, consisting of sales of Translarna, Tegsedi, Waylivra, and Upstaza. Translarna net product revenues made up $355.8 million, $288.6 million, and $236.0 million of the net product sales outside the United States for the years ended December 31, 2023, 2022, and 2021, respectively. During the years ended December 31, 2023 and 2022, two countries, the United States and Russia, accounted for at least 10% of the Company’s net product sales, representing $255.1 million and $86.0 million, and $218.3 million and $59.7 million of the net product sales, respectively. During the year ended December 31, 2021, only the United States accounted for at least 10% of the Company’s net product sales. For the years ended December 31, 2023, 2022, and 2021, two of the Company’s distributors each accounted for over 10% of the Company’s net product sales.

As of December 31, 2023 and 2022, the Company does not have a contract liabilities balance related to net product sales, and has not made significant changes to the judgments made in applying ASC Topic 606.

Collaboration revenue and Royalty revenue

In November 2011, the Company and the Spinal Muscular Atrophy Foundation (“SMA Foundation”) entered into a licensing and collaboration agreement with F. Hoffman-La Roche Ltd and Hoffman- La Roche Inc. (collectively, “Roche”). Under the terms of the SMA License Agreement, Roche acquired an exclusive worldwide license to the Company’s SMA program.

Under the agreement, the Company is eligible to receive additional payments from Roche if specified events are achieved with respect to each licensed product, including up to $135.0 million in research and development event milestones, up to $325.0 million in sales milestones upon achievement of certain sales events, and up to double digit royalties on worldwide annual net sales of a commercial product.

For the years ended December 31, 2023, 2022, and 2021, the Company recognized revenue related to the licensing and collaboration agreement with Roche of $100.0 million, $50.1 million, and $55.0 million, respectively. The below summarizes the milestone achievements associated with the Company’s SMA program during the years ended December 31, 2023, 2022, and 2021.

The SMA program currently has one approved product, Evrysdi, which was approved in August 2020 by the FDA for the treatment of SMA in adults and children two months and older. The first commercial sale of Evrysdi in the EU was made in March 2021. This event triggered a $20.0 million milestone payment to the Company from Roche. The first commercial sale in Japan was made in August 2021, which was the final research and development milestone received by the Company. This event triggered a $10.0 million payment to the Company from Roche. In December 2021, the Company recorded its first sales milestone of $25.0 million for the achievement of $500.0 million in worldwide annual net sales from Evrysdi. The Company recorded these three milestone payments as collaboration revenue for the year ended December 31, 2021.

In September 2022, the Company recognized a sales milestone of $50.0 million for the achievement of $750.0 million in worldwide annual net sales from Evrysdi, which is recorded on the balance sheet within prepaid expenses and other current assets as of December 31, 2022. For the year ended December 31, 2023, the Company recognized a sales milestone

of $100.0 million for the achievement of $1.5 billion in worldwide annual net sales from Evrysdi, which is recorded on the balance sheet within prepaid expenses and other current assets as of December 31, 2023. The remaining potential sales milestones as of December 31, 2023 is $150.0 million upon achievement of certain sales events. As of December 31, 2023, the Company does not have any remaining research and development milestones that can be received.

In addition to research and development and sales milestones, the Company is eligible to receive up to double-digit royalties on worldwide annual net sales of a commercial product under the SMA License Agreement. For the years ended December 31, 2023, 2022, and 2021 the Company has recognized $168.9 million, $113.5 million, and $54.6 million of royalty revenue related to Evrysdi, respectively.

Manufacturing Revenue

For the year ended December 31, 2023, the Company recognized $7.7 million of manufacturing revenue related to the production of DNA and AAV vectors for gene therapy applications for external customers. No manufacturing revenue was recognized for the years ended December 31, 2022 and 2021. The Company has not made significant changes to the judgments made in applying ASC Topic 606 for the years ended 2023, 2022, and 2021.

As of December 31, 2023 and 2022, the Company has a contract liabilities balance of $0.8 million and $1.4 million, respectively, relating to the production of plasmid DNA and AAV vectors for gene therapy applications for external customers, which is recorded within deferred revenue on the consolidated balance sheet. For the year ended December 31, 2023, the Company recognized $1.4 million related to the amounts included in the contract liability balance at the beginning of the period.

As of December 31, 2023, the Company has contract assets of $0.2 million related to plasmid DNA and AAV production for external customers, which is recorded within prepaid expenses and other current assets on the consolidated balance sheet. The Company did not have any contract assets for the period ending December 31, 2022.

Remaining performance obligations

As of December 31, 2023, and 2022, the Company has remaining performance obligations of $0.8 million and $1.4 million, respectively, related to the production of plasmid DNA and AAV vectors for gene therapy applications for external customers. The Company expects to recognize revenue over the next one year, as the specific timing for satisfying the performance obligations is contingent upon a number of factors, including customers’ needs and schedules.