XML 49 R22.htm IDEA: XBRL DOCUMENT
v3.22.4

INCOME TAXES | 12 Months Ended
--- | ---
Dec. 31, 2022
Income Tax Disclosure [Abstract] |
INCOME TAXES | 14. INCOME TAXES Income tax expense consists of the following:
|  | Year Ended December 31, |
(In thousands) |  | 2022 |  |  | 2021 |  |  | 2020 |
Current |  |  |  |  |  |  |  |  |
Federal |  | $ | 40,822 |  |  | $ | — |  |  | $ | — |
State |  |  | 464 |  |  |  | 7 |  |  |  | 11 |
Total current |  |  | 41,286 |  |  |  | 7 |  |  |  | 11 |
Deferred |  |  |  |  |  |  |  |  |
Federal |  |  | 26,026 |  |  |  | 70,893 |  |  |  | 60,408 |
State |  |  | (625 | ) |  |  | 5,539 |  |  |  | 12 |
Total deferred |  |  | 25,401 |  |  |  | 76,432 |  |  |  | 60,420 |
Total income tax expense, net |  | $ | 66,687 |  |  | $ | 76,439 |  |  | $ | 60,431 |
The impacts of the differences between the expected U.S. federal statutory income tax to our income tax expense are as follows:
|  | Year Ended December 31, |
(In thousands) |  | 2022 |  |  | 2021 |  |  | 2020 |
Expected tax at federal statutory rate |  | $ | 58,928 |  |  | $ | 93,507 |  |  | $ | 74,392 |
State income tax, net of federal benefit |  |  | (1,414 | ) |  |  | 848 |  |  |  | (26 | )
Federal and state research credits |  |  | (2,453 | ) |  |  | 1,260 |  |  |  | — |
Noncontrolling interest |  |  | 7,468 |  |  |  | (21,626 | ) |  |  | (14,577 | )
Impact of consolidation and deconsolidation of subsidiaries |  |  | (8,897 | ) |  |  | — |  |  |  | — |
Other |  |  | (125 | ) |  |  | 1,129 |  |  |  | 839 |
Change in valuation allowance |  |  | 13,180 |  |  |  | 1,321 |  |  |  | (197 | )
Income tax expense (benefit), net |  | $ | 66,687 |  |  | $ | 76,439 |  |  | $ | 60,431 |
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of our deferred tax assets and deferred tax liabilities are as follows:
|  | December 31, |
(In thousands) |  | 2022 |  |  | 2021 |
Deferred tax assets |  |  |  |  |  |
Net operating loss carryforwards |  | $ | 149,646 |  |  | $ | 64,813 |
Research and development tax credit carryforwards |  |  | 21,230 |  |  |  | 53,467 |
Unrealized loss on investment, net |  |  | 6,032 |  |  |  | — |
Deferred royalty obligation, net |  |  | 17,404 |  |  |  | — |
Other |  |  | 8,527 |  |  |  | 743 |
Total deferred tax assets before valuation allowance |  |  | 202,839 |  |  |  | 119,023 |
Valuation allowance |  |  | (144,808 | ) |  |  | (64,744 | )
Total deferred tax assets |  |  | 58,031 |  |  |  | 54,279 |
Deferred tax liabilities |  |  |  |  |  |
Depreciation and amortization |  |  | (50,587 | ) |  |  | (9,158 | )
Unrealized gain on investment, net |  |  | — |  |  |  | (27,794 | )
Inventory fair value adjustment |  |  | (12,410 | ) |  |  | — |
Other |  |  | (805 | ) |  |  | — |
Net deferred tax assets (liabilities) |  | $ | (5,771 | ) |  | $ | 17,327 |
We record deferred tax assets if the realization of such assets is more likely than not to occur. Significant management judgment is required in determining whether a valuation allowance against the deferred tax assets is required. We have considered all available evidence, both positive and negative, such as our historical operating results and predictability of future taxable income, in making such determination. We are also required to exercise significant management’s judgment in forecasting future taxable income. Specifically, we evaluate the following criteria when considering a valuation allowance: • the history of tax net operating losses in recent years; • predictability of operating results; • profitability for a sustained period of time; and • level of profitability on a quarterly basis. As of December 31, 2022, we had federal net operating loss carryforwards of approximately $411.5 million, which will expire beginning 2032. As of December 31, 2022, we also had state net operating loss carryforwards of approximately $955.3 million, which will expire beginning 2029 and state research tax credits of approximately $33.3 million, which do not expire. Utilization of net operating loss and tax credit carryforwards may be subject to a substantial annual limitation due to ownership change limitations provided by the Internal Revenue Code and similar state provisions. Annual limitations may result in expiration of net operating loss and tax credit carryforwards before some or all of such amounts have been utilized. We conducted an Internal Revenue Code of 1986, as amended, Section 382 (“Section 382”) analysis of the Company through December 31, 2022 to determine whether an ownership change had occurred since inception. The Section 382 study concluded that it is more likely than not that the Company did not experience an ownership change during the testing period. However, notwithstanding the applicable annual limitations, no portion of our net operating loss or credit carryforwards is expected to expire before becoming available to reduce federal and state income tax liabilities as a result of those identified ownership changes. If we undergo another ownership change, the utilization of the pre-ownership change net operating loss carryforwards or pre-ownership change tax attributes, such as research tax credits, to offset the post-ownership change income may be subject to an annual limitation, pursuant to Sections 382 and 383 of the Internal Revenue Code of 1986, as amended. Similar rules may apply under state tax laws. As a result of the acquisition of Entasis, we conducted a study of Entasis’ ownership changes and estimated that we will be able to utilize $157.4 million of its federal net operating losses, which are subject to annual limitations. As a result of the acquisition of La Jolla, we also performed a preliminary analysis of its ownership changes and estimated that we will be able to utilize $254.0 million of its federal net operating losses, which are subject to annual limitations. Our policy is to recognize interest and/or penalties related to income tax matters in income tax expense. As of December 31, 2022 and 2021, we had no accrued interest or penalties due to the Company's net operating losses available to offset any tax adjustments. Uncertain Tax Positions A reconciliation of the beginning and ending balances of the total amounts of unrecognized tax benefits are as follows:
(In thousands) |  | Amount |
Unrecognized tax benefits as of December 31, 2019 |  | $ | 15,342 |
Net decrease in tax portions for 2020 |  |  | (157 | )
Unrecognized tax benefits as of December 31, 2020 |  |  | 15,185 |
Net decrease in tax portions for 2021 |  |  | (313 | )
Unrecognized tax benefits as of December 31, 2021 |  |  | 14,872 |
Net increase in tax portions for 2022 |  |  | 1,452 |
Unrecognized tax benefits as of December 31, 2022 |  | $ | 16,324 |
We are subject to taxation in the U.S. and various state jurisdictions. The tax years 2004 through 2013, 2015 and forward remain open to examination by the federal and most state tax authorities due to net operating loss and overall credit carryforward positions.

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