Significant Accounting Policies (Tables)

9 Months Ended

Sep. 30, 2016

Summarize Activity of the Net Product Revenue Allowance and Reserve Categories

The following tables summarize activity in each of the net product revenue allowance and reserve categories described above for the nine months ended September 30, 2016 and 2015:


In thousands	Trade Allowances			Rebates, Chargebacks and Discounts			Product Returns			Other Incentives			Total
Balance as of December 31, 2015	$	4,296		$	9,881		$	535		$	1,084		$	15,796
Provision related to current period sales		15,823			46,553			403			8,539			71,318
Provision related to prior period sales		(87	)		(402	)		—			—			(489	)
Credits/payments made for current period sales		(11,086	)		(22,236	)		—			(6,788	)		(40,110	)
Credits/payments made for prior period sales		(4,180	)		(8,492	)		(247	)		(1,284	)		(14,203	)

Balance as of September 30, 2016	$	4,766		$	25,304		$	691		$	1,551		$	32,312


In thousands	Trade Allowances			Rebates, Chargebacks and Discounts			Product Returns			Other Incentives			Total
Balance as of December 31, 2014	$	2,207		$	3,610		$	481		$	792		$	7,090
Provision related to current period sales		10,104			21,633			231			5,976			37,944
Provision related to prior period sales		(174	)		(70	)		—			—			(244	)
Credits/payments made for current period sales		(6,729	)		(14,194	)		—			(4,220	)		(25,143	)
Credits/payments made for prior period sales		(2,043	)		(3,522	)		(26	)		(792	)		(6,383	)

Balance as of September 30, 2015	$	3,365		$	7,457		$	686		$	1,756		$	13,264

Summarizes the Impact of Accounts Receivable Reserves on Gross Trade Accounts Receivable

The following table summarizes the impact of accounts receivable reserves on the gross trade accounts receivable balances as of September 30, 2016 and December 31, 2015:


In thousands	September 30, 2016			December 31, 2015
Gross trade accounts receivable	$	22,522		$	18,270
Trade allowances		(4,766	)		(4,296	)
Chargebacks		(240	)		(148	)
Allowance for doubtful accounts		(12	)		—

Accounts receivable, net	$	17,504		$	13,826

Estimated Useful Lives

The estimated useful lives, by asset classification, are as follows:


Asset Classification		Useful Lives
Computer equipment and software		3 - 5 years
Furniture and fixtures		5 years
Leasehold improvements		Lesser of useful life or lease term

Net Loss and the Number of Shares Used to Compute Basic and Diluted Net Loss per Share

The calculation of net loss and the number of shares used to compute basic and diluted net loss per share for the three and nine months ended September 30, 2016 and 2015 are as follows:


	Three months ended September 30,						Nine months ended September 30,
In thousands	2016			2015			2016			2015
Net loss	$	(15,772	)	$	(30,675	)	$	(58,897	)	$	(93,313	)
Preferred stock purchase option (see Note 8)		—			—			—			(868	)
Preferred stock beneficial conversion features (see Note 8)		—			(1,646	)		—			(32,987	)

Net loss applicable to common shareholders—basic		(15,772	)		(32,321	)		(58,897	)		(127,168	)
Gain on warrant derivative liability		—			—			—			(119	)

Net loss—diluted		(15,772	)		(32,321	)		(58,897	)		(127,287	)
Net loss per share—basic and diluted		(0.08	)		(0.18	)		(0.31	)		(0.71	)
Weighted average shares outstanding—basic and diluted		209,149			183,245			192,618			179,780

Anti-Dilutive Securities Not Included in the Computation of Net Loss or Earnings per Share

For the three and nine months ended September 30, 2016 and 2015, the following potentially dilutive securities were not included in the computation of net loss per share because the effect would be anti-dilutive:


	Three months ended September 30,				Nine months ended September 30,
In thousands	2016		2015		2016		2015
Stock options		21,241		17,627		21,241		17,627
Restricted stock and restricted stock units		10,346		11,001		10,346		11,001
Exchangeable senior notes (if converted)		1,714		49,215		1,714		49,215
Preferred stock (if converted)		32,818		32,818		32,818		32,818

Assets and Liability Measured at Fair Value on a Recurring Basis

The following tables present information about the Company’s assets and liabilities as of September 30, 2016 and December 31, 2015 that are measured at fair value on a recurring basis and indicate the fair value hierarchy of the valuation techniques the Company utilized to determine such fair value:


	September 30, 2016
In thousands	Total		Level 1		Level 2		Level 3
Asset:
Cash equivalents—money markets	$	14,223	$	14,223	$	—	$	—

Liabilities:
Long-term debt derivative liabilities	$	—	$	—	$	—	$	—


	December 31, 2015
In thousands	Total		Level 1		Level 2		Level 3
Asset:
Cash equivalents—money markets	$	14,184	$	14,184	$	—	$	—

Liabilities:
Long-term debt derivative liabilities	$	8,170	$	—	$	—	$	8,170

Carrying Amounts and Estimated Fair Values of Debt Instruments

The carrying amounts of cash, cash equivalents, accounts payable and accrued liabilities approximate fair value because of their short-term nature. The carrying amounts and the estimated fair values of debt instruments as of September 30, 2016 and December 31, 2015 are as follows:


	September 30, 2016				December 31, 2015
In thousands	Carrying Value		Estimated Fair Value		Carrying Value		Estimated Fair Value
Long-term debt from royalty-bearing instrument	$	93,055	$	90,800	$	91,512	$	87,700
2012 Notes		15,107		15,084		15,107		13,637
2014 Notes		—		—		94,599		108,034
2015 Notes		—		—		27,028		28,448

Change in Fair Value of Derivative Liabilities

The change in the fair value of derivative liabilities for the nine months ended September 30, 2016 and 2015 is as follows:


In thousands	October 2009 Warrants		Long-Term Debt Derivative Liabilities			Preferred Stock Purchase Option		Totals
Balance as of December 31, 2015	$	—	$	8,170		$	—	$	8,170
Gain on change in fair value of derivative liabilities		—		(8,170	)		—		(8,170	)

Balance as of September 30, 2016	$	—	$	—		$	—	$	—


In thousands	October 2009 Warrants			Long-Term Debt Derivative Liabilities			Preferred Stock Purchase Option			Totals
Balance as of December 31, 2014	$	119		$	7,400		$	—		$	7,519
Record derivative liability		—			—			868			868
(Gain) loss on change in fair value of derivative liabilities		(110	)		(470	)		946			366
Compensation income for change in fair value of warrants issued to former employees		(9	)		—			—			(9	)
Transfer derivative liability to equity		—			—			(1,814	)		(1,814	)

Balance as of September 30, 2015	$	—		$	6,930		$	—		$	6,930

- Definition

Tabular disclosure of financial instruments measured at fair value, including those classified in shareholders' equity measured on a recurring or nonrecurring basis. Disclosures include, but are not limited to, fair value measurements recorded and the reasons for the measurements, level within the fair value hierarchy in which the fair value measurements are categorized and transfers between levels 1 and 2. Nonrecurring fair value measurements are those that are required or permitted in the statement of financial position in particular circumstances.

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