XML 31 R18.htm IDEA: XBRL DOCUMENT
v3.24.0.1

Collaboration, Licensing and Other Arrangements | 12 Months Ended
--- | ---
Dec. 31, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract] |
Collaboration, Licensing and Other Arrangements | 11. Collaboration, Licensing and Other Arrangements Revenue from collaborations and services were as follows (in thousands):
|  | Year Ended December 31, |
|  | 2023 |  |  | 2022 |  |  | 2021 |
UT CSA Agreement (1) |  | $ | 52,025 |  |  | $ | 24,826 |  |  | $ | 267 |
UT License Agreement (2) |  |  | 782 |  |  |  | 2,426 |  |  |  | 34,145 |
Cipla License and Distribution Agreement |  |  | 147 |  |  |  | 147 |  |  |  | 147 |
Vertice Pharma Co-Promotion Agreement |  |  | — |  |  |  | 325 |  |  |  | 1,147 |
Other |  |  | — |  |  |  | 200 |  |  |  | 323 |
Receptor CLA |  |  | — |  |  |  | — |  |  |  | 245 |
Total revenue from collaborations and services |  | $ | 52,954 |  |  | $ | 27,924 |  |  | $ | 36,274 |
_________________________ (1) Amounts consist of revenue recognized for Manufacturing Services and sales of product to UT for the periods presented. (2) Amounts consist of revenue recognized for Next-Gen R&D Services and R&D Services and License for the periods presented. The activity related to deferred revenue and the related revenue recognized for collaborations and services is as follows (in thousands):
|  | December 31, 2023 |  |  | December 31, 2022 |
Deferred revenue: |  |  |  |  |  |
Beginning balance |  | $ | 39,417 |  |  | $ | 20,370 |
Additions |  |  | 92,416 |  |  |  | 46,971 |
Revenue — collaborations and services |  |  | (52,954 | ) |  |  | (27,924 | )
Ending balance |  | $ | 78,879 |  |  | $ | 39,417 |
United Therapeutics License Agreement — In September 2018, the Company and UT entered into an exclusive global license and collaboration agreement (the “UT License Agreement”), pursuant to which UT is responsible for global development, regulatory and commercial activities with respect to Tyvaso DPI. The Company is responsible for manufacturing Tyvaso DPI. Total revenue from UT was as follows (in thousands):
|  | Year Ended December 31, |
|  | 2023 |  |  | 2022 |  |  | 2021 |
UT Revenue |  |  |  |  |  |  |  |  |
UT CSA Agreement |  | $ | 52,025 |  |  | $ | 24,826 |  |  | $ | 267 |
UT License Agreement |  |  | 782 |  |  |  | 2,426 |  |  |  | 34,145 |
Royalties — Collaborations (1) |  |  | 71,979 |  |  |  | 15,599 |  |  |  | — |
Total revenue from UT |  | $ | 124,786 |  |  | $ | 42,851 |  |  | $ | 34,412 |
_________________________ (1) Amounts consist of royalties associated with the UT License Agreement. The contract assets related to the royalties is included in prepaid expense and other current assets in the consolidated balance sheets. In October 2018, the Company and UT entered into the UT License Agreement for the collaboration and development of Tyvaso DPI. Pursuant to this agreement, the Company receives a 10% royalty on net sales of Tyvaso DPI. In December 2023, the Company sold a 1% royalty on future net sales of Tyvaso DPI to a royalty purchaser, with the Company retaining a 9% royalty. In August 2021, the Company and UT entered into the CSA, pursuant to which the Company is responsible for manufacturing and supplying to UT, and UT is responsible for purchasing from the Company on a cost-plus basis. In addition, UT is responsible for supplying treprostinil at its expense in quantities necessary to enable the Company to manufacture Tyvaso DPI as required by the CSA. The activities and deliverables under the CSA and UT License Agreement resulted in distinct performance obligations which include: (1) the license, supply of product to be used in clinical development, and continued development and approval support for Tyvaso DPI ("R&D Services and License"); (2) development activities for the next generation of Tyvaso DPI ("Next-Gen R&D Services"); and (3) a material right associated with current and future commercial manufacturing and supply of product ("Manufacturing Services and Product Sales"). There have been various amendments to the UT License Agreement and the CSA since inception. As amended, the term of the CSA continues until December 31, 2031 (unless earlier terminated) and is thereafter renewed automatically for additional, successive two-year terms unless (i) UT provides notice to the Company at least 24 months in advance of such renewal that UT does not wish to renew the CSA or (ii) the Company provides notice to UT at least 48 months in advance of such renewal that the Company does not wish to renew the CSA. The Company and UT each have normal and customary termination rights, including termination for material breach that is not cured within a specific timeframe or in the event of liquidation, bankruptcy or insolvency of the other party. The Company accounted for the contract modification as if it were part of the existing contract since the amendment modified the scope and price of the CSA by extending the term and increasing the occupancy rate. The effect of the modification on the transaction price and on the measure of progress is recognized as an adjustment to revenue as of the date of modification. The modification did not result in a change in the activities and deliverables under the CSA. In December 2022, the Company and UT agreed to fund an additional $39.5 million to support capital and continuous improvement activities and $2.3 million in the development of alternative manufacturing processes. The Company determined that the capital and continuous improvements should be combined with the manufacturing services performance obligation and the alternative manufacturing processes should be combined with the Next-Gen R&D Services. The total revised anticipated cash flows of $722.3 million from the transaction was allocated to the three distinct performance obligations as follows (dollars in millions).
|  | Anticipated |  |  |  |  |  |  |  |
|  | Cash Flow |  |  | Revenue Allocation |  |  | Recognition Method |  | Progress Measure |  | Revenue Recognition |
Total anticipated cash flow(1) |  | $ | 722.3 |  |  |  |  |  |  |  |  |  |  |
Distinct Performance Obligation |  |  |  |  |  |  |  |  |  |  |  |  |
R&D Services and License |  |  |  |  | $ | — |  |  | Over time |  | Ratably |  | Aug 2021 - Oct 2021 |
Next-Gen R&D Services |  |  |  |  | $ | 10.0 |  |  | Over time |  | Input |  | % of completion of costs |
Manufacturing Services and Product Sales(2) |  |  |  |  | $ | 712.3 |  |  | Point in time |  |  |  | Transfer of control |
__________________________ (1) The total anticipated cash flow includes a transaction price of $120.0 million for the contractual obligations under the CSA for the Manufacturing Services and the Next-Gen R&D Services performance obligations and $602.3 million for future supply of Tyvaso DPI over the remaining term of the CSA. (2) The Manufacturing Services performance obligation will be recognized as control of manufactured products is transferred to UT. The modification did not result in a cumulative catch-up adjustment as a result of the revenue being deferred for the performance obligations that were affected by the modification. The allocation of the transaction price for the Manufacturing Services includes a material right related to the Company’s estimated production of product in the amount of $220.8 million. The Company will sell product to UT under individual purchase orders, which represent distinct performance obligations. The ultimate cash flows may vary as manufacturing purchase orders are received. As of December 31, 2023, deferred revenue consisted of $77.5 million, of which $8.9 million was classified as current and $68.6 million was classified as long-term on the consolidated balance sheet. As of December 31, 2022, deferred revenue consisted of $37.9 million, of which $1.6 million was classified as current and $36.3 million was classified as long-term on the consolidated balance sheet. The increase in deferred revenue is primarily related to the capital improvements for the expansion of our manufacturing facility. The Company determined that the revenue recognition associated with the capital improvements should be combined with the manufacturing services performance obligation. Thirona Collaboration Agreement — In June 2021, the Company and Thirona entered into a collaboration agreement to evaluate the therapeutic potential of Thirona’s compound for the treatment of pulmonary fibrosis. If initial studies are promising, the Company can exercise certain rights to seek a full license to the compound for clinical development and commercialization. The parties will perform their respective obligations and provide reasonable support for research, clinical development and regulatory strategy. The collaboration agreement was accounted for under ASC 808, Collaborative Agreements; however, no consideration was exchanged between the parties. The costs incurred by the Company were expensed as R&D in the consolidated statements of operations. On February 28, 2023, the collaboration agreement was amended to extend the term through June 2024. In accordance with the amendment, the Company agreed to fund a minimum of $1.1 million to be expended on a revised development plan prepared by Thirona, of which $0.7 million was funded during the year ended December 31, 2023. Biomm Supply and Distribution Agreement — In May 2017, the Company and Biomm S.A. (“Biomm”) entered into a supply and distribution agreement for the commercialization of Afrezza in Brazil. Under this agreement, Biomm was responsible for pursuing regulatory approvals of Afrezza in Brazil, including from the Agência Nacional de Vigilância Sanitária (“ANVISA”) and, with respect to pricing matters, from the Camara de Regulação de Mercado de Medicamentos (“CMED”), both of which were received. Biomm commenced product sales in January 2020. No shipments of product were made to Biomm during the year ended December 31, 2023, 2022 or 2021. Cipla License and Distribution Agreement — In May 2018, the Company and Cipla Ltd. (“Cipla”) entered into an exclusive agreement for the marketing and distribution of Afrezza in India and the Company received a $2.2 million nonrefundable license fee. Under the terms of the agreement, Cipla is responsible for obtaining regulatory approvals to distribute Afrezza in India and for all marketing and sales activities of Afrezza in India. The Company is responsible for supplying Afrezza to Cipla. The Company has the potential to receive an additional regulatory milestone payment, minimum purchase commitment revenue and royalties on Afrezza sales in India once cumulative gross sales have reached a specified threshold. The nonrefundable licensing fee was recorded in deferred revenue and is being recognized in net revenue – collaborations over 15 years, representing the estimated period to satisfy the performance obligation. The additional milestone payments represent variable consideration for which the Company has not recognized any revenue because of the uncertainty of obtaining marketing approval. As of December 31, 2023, the deferred revenue balance was $1.4 million, of which $0.2 million was classified as current and $1.2 million was classified as long term in the consolidated balance sheets. As of December 31, 2022, the deferred revenue balance was $1.5 million, of which $0.1 million is classified as current and $1.4 million is classified as long term in the consolidated balance sheets.

X
- Definition The entire disclosure for collaborative arrangements in which the entity is a participant, including a) information about the nature and purpose of such arrangements; b) its rights and obligations thereunder; c) the accounting policy for collaborative arrangements; and d) the income statement classification and amounts attributable to transactions arising from the collaborative arrangement between participants. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -SubTopic 10 -Topic 808 -Publisher FASB -URI https://asc.fasb.org//1943274/2147479402/808-10-50-1 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (b) -SubTopic 10 -Topic 808 -Publisher FASB -URI https://asc.fasb.org//1943274/2147479402/808-10-50-1 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Name Accounting Standards Codification -Topic 808 -Publisher FASB -URI https://asc.fasb.org//808/tableOfContent + Details
Name: | us-gaap_CollaborativeArrangementDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration

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