XML 38 R21.htm IDEA: XBRL DOCUMENT
v3.22.4

Income Taxes | 12 Months Ended
--- | ---
Dec. 31, 2022
Income Tax Disclosure [Abstract] |
Income Taxes | Income Taxes For financial reporting purposes, income (loss) before income taxes includes the following components:
|  | Years Ended December 31,
(in thousands) |  | 2022 |  | 2021 |  | 2020
United States |  | $ | (343,424) |  |  | $ | (333,571) |  |  | $ | (365,332) |
Foreign |  | 101,385 |  |  | 92,017 |  |  | 91,078 |
Total |  | $ | (242,039) |  |  | $ | (241,554) |  |  | $ | (274,254) |
Following were the components of income tax expense (benefit) for the years ended December 31, 2022, 2021, and 2020:
|  | Years Ended December 31,
(in thousands) |  | 2022 |  | 2021 |  | 2020
Current |  |  |  |  |  |
Federal |  | $ | — |  |  | $ | — |  |  | $ | — |
State |  | 6 |  |  | 15 |  |  | 11 |
Foreign |  | (5,760) |  |  | 8,857 |  |  | 4,163 |
Deferred |  |  |  |  |  |
Federal |  | 274 |  |  | — |  |  | (1,421) |
State |  | 9 |  |  | 34 |  |  | (155) |
Foreign |  | — |  |  | — |  |  | — |
Total |  | $ | (5,471) |  |  | $ | 8,906 |  |  | $ | 2,598 |
A reconciliation of the statutory tax rates and the effective tax rates for the years ended December 31, 2022, 2021, and 2020 are as follows:
|  | Years Ended December 31,
|  | 2022 |  | 2021 |  | 2020
Statutory rate |  | (21) | % |  | (21) | % |  | (21) | %
Tax credits |  | (11) |  |  | (9) |  |  | (7) |
Impact of foreign operations |  | 18 |  |  | 3 |  |  | 4 |
Other |  | 3 |  |  | 3 |  |  | 2 |
Valuation allowance |  | 9 |  |  | 28 |  |  | 23 |
Net |  | (2) | % |  | 4 | % |  | 1 | %
On December 22, 2017, the U.S. government enacted the Tax Cuts and Jobs Act ("Tax Act"). The Tax Act significantly revises U.S. tax law by, among other provisions, lowering the U.S. federal statutory income tax rate to 21%, imposing a mandatory one-time transition tax on previously deferred foreign earnings, and eliminating or reducing certain income tax deductions. The Tax Act also introduced an additional U.S. tax on certain non-U.S. subsidiaries’ earnings which are considered to be Global Intangible Low Taxed Income (referred to as "GILTI"). After consideration of the relevant guidance and completing the accounting for the tax effects of the Tax Act, the Company has elected to treat GILTI as a period cost. Beginning in 2022, the Tax Act eliminated the right to deduct research and development expenditures for tax purposes in the period the expenses were incurred and instead requires all U.S. and foreign research and development expenditures to be amortized over five and fifteen tax years, respectively. Tax returns for years 2017 through 2022 are open to examination by tax authorities. The Company is also subject to examination in any period for which it has net operating losses. Deferred income taxes reflect the net effect of temporary difference between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The significant components of the deferred tax assets and liabilities are as follows:
|  | Years Ended December 31,
(in thousands) |  | 2022 |  | 2021
Deferred tax assets |  |  |  |
Intellectual property |  | $ | 68,567 |  |  | $ | 105,453 |
Research tax credit |  | 223,366 |  |  | 205,095 |
Capitalized research and development costs |  | 29,317 |  |  | — |
Net operating loss carry forwards |  | 315,444 |  |  | 334,762 |
Share-based compensation |  | 16,417 |  |  | 11,779 |
Interest carry forward limitation |  | 12,558 |  |  | 8,285 |
Lease liability |  | 11,428 |  |  | 9,105 |
Inventory |  | 10,400 |  |  | — |
Other |  | 20,109 |  |  | 17,748 |
Gross deferred tax assets |  | 707,606 |  |  | 692,227 |
Deferred tax liabilities |  |  |  |
Business acquisition |  | (4,939) |  |  | (4,930) |
Royalty payable |  | (68,567) |  |  | (105,453) |
Other |  | (6,806) |  |  | (4,932) |
Total net deferred tax assets |  | 627,294 |  |  | 576,912 |
Less: valuation allowance |  | (632,233) |  |  | (581,842) |
Net deferred tax liability |  | $ | (4,939) |  |  | $ | (4,930) |
The Company records a valuation allowance for temporary differences for which it is more likely than not that the Company will not receive future tax benefits. At December 31, 2022 and 2021, the Company recorded valuation allowances of $632.2 million and $581.8 million, respectively, representing an increase in the valuation allowance of $50.4 million in 2022, due to the uncertainty regarding the realization of such deferred tax assets, to offset the benefits of net operating losses generated during those years. The deferred tax liability related to business acquisitions pertains to the basis difference in IPR&D acquired by the Company. The Company's policy is to record a deferred tax liability related to acquired IPR&D that 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. As of December 31, 2022, the Company had federal and state net operating loss carry forwards ("NOLs") of approximately $1,183 million and $992 million, respectively. The federal carry forward for losses generated prior to 2018 will expire in 2029 through 2037. Federal net operating losses incurred in 2018 and onward have an indefinite expiration under the Tax Act. Most of the state carry forwards generated prior to 2009 have expired through 2016. The remaining state carry forwards including those generated in 2009 through 2022 will expire in 2029 through 2040. Utilization of NOLs may be subject to a substantial limitation pursuant to Section 382 of the Internal Revenue Code of 1986, as amended as well as similar state statutes in the event of an ownership change. Such ownership changes have occurred in the past and could occur again in the future. Under Section 382 of the Internal Revenue Code of 1986, as amended, or Section 382, if a corporation undergoes an "ownership change," generally defined as a greater than 50% change (by value) in its equity ownership over a three-year period, the corporation's ability to use its pre-change NOLs and other pre-change tax attributes (such as research and development tax credits) to offset its post-change income may be limited. The Company may experience ownership changes in the future as a result of shifts in the stock ownership some of which are outside the Company's control. The Company completed a detailed study of the NOLs for the tax year 2022 and determined that there was not an ownership change in excess of 50%. Ownership changes in future periods may place additional limits on the Company's ability to utilize net operating loss and tax credit carry forwards. In addition, at the state level, there may be periods during which the use of NOLs is suspended or otherwise limited, which could accelerate or permanently decrease the amount of state attributes and increase state taxes owed. The Company also has research and experimentation and orphan drug credit carryforwards of approximately $36.4 million and $187.0 million, respectively, which will expire in the years 2030 through 2040. Deferred tax assets for these carryforwards are subject to a full valuation allowance.

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 -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 21 -URI https://asc.fasb.org/extlink&oid=121826272&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 https://asc.fasb.org/extlink&oid=122134291&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 https://asc.fasb.org/extlink&oid=121826272&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 https://asc.fasb.org/extlink&oid=122134291&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 https://asc.fasb.org/extlink&oid=121826272&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 https://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 https://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 https://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration