XML 50 R16.htm IDEA: XBRL DOCUMENT
v3.22.4

Income Taxes | 12 Months Ended
--- | ---
Dec. 31, 2022
Income Tax Disclosure [Abstract] |
Income Taxes | (10) Income Taxes The Company recognizes interest and penalties related to uncertain tax positions within the provision for income taxes. The total amount of unrecognized tax benefits that would affect the Company’s effective tax rate if recognized is $8.2 million and $7.9 million as of December 31, 2022 and 2021, respectively. The Company recognized interest related to uncertain tax positions of $0.5 million and $0.9 million for the years ended December 31, 2022 and 2021, respectively. No penalties have been recognized in conjunction with these positions. The following is a reconciliation of the total amounts of unrecognized tax benefits for the years ended December 31, 2022, 2021 and 2020:
In thousands |  |  | 2022 |  |  | 2021 |  |  | 2020 |
Beginning uncertain tax benefits |  | $ | 22,040 |  |  | $ | 24,034 |  |  | $ | 26,743 |
Prior year—increases |  |  | — |  |  |  | 16 |  |  |  | 2,428 |
Prior year—decreases |  |  | (9,107 | ) |  |  | (2,248 | ) |  |  | (5,391 | )
Current year—increases |  |  | 5,782 |  |  |  | 238 |  |  |  | 254 |
Ending uncertain tax benefits |  | $ | 18,715 |  |  | $ | 22,040 |  |  | $ | 24,034 |
The Company files income tax returns in the United States, Ireland and United Kingdom, or UK. The Company remains subject to tax examinations in the following jurisdictions as of December 31, 2022:
Jurisdiction |  | Tax Years
United States—Federal | 2018-2022
United States—State | 2012-2022
Ireland | 2018-2022
United Kingdom | 2021-2022
The Company does no t expect any gross liabilities to expire in 2023 based on statutory lapses or audits. The components of income (loss) from operations before taxes were as follows for the years ended December 31, 2022, 2021 and 2020:
In thousands |  | 2022 |  |  | 2021 |  |  | 2020 |
United States |  | $ | 5,358 |  |  | $ | 10,222 |  |  | $ | 14,915 |
Ireland and United Kingdom |  |  | (112,527 | ) |  |  | (4,368 | ) |  |  | (32,170 | )
Other |  |  |  | 3,364 |  |  |  | 5,437 |  |  |  | — |
Total (loss) / income before taxes |  |  | $ | (103,805 | ) |  | $ | 11,291 |  |  | $ | (17,255 | )
The provision for income taxes shown in the accompanying consolidated statements of operations consists of the following for the years ended December 31, 2022, 2021 and 2020:
In thousands |  | 2022 |  |  | 2021 |  |  | 2020 |
Current: |  |  |  |  |  |  |  |  |
United States—Federal |  | $ | 562 |  |  | $ | 2,690 |  |  | $ | 45 |
United States—State |  |  | 573 |  |  |  | 716 |  |  |  | 700 |
Foreign |  |  |  | 863 |  |  |  | 156 |  |  |  | — |
Total current |  | $ | 1,998 |  |  | $ | 3,562 |  |  | $ | 745 |
Deferred: |  |  |  |  |  |  |  |  |
United States—Federal |  |  | (3,721 | ) |  |  | 5,222 |  |  |  | 1,972 |
United States—State |  |  | 284 |  |  |  | (3,057 | ) |  |  | 1,956 |
Foreign |  |  | (1,646 | ) |  |  | (1,619 | ) |  |  | (26,793 | )
Change in valuation allowance |  |  | 5,083 |  |  |  | (546 | ) |  |  | 22,865 |
Total deferred |  | $ | — |  |  | $ | — |  |  | $ | — |
Provision for income taxes |  | $ | 1,998 |  |  | $ | 3,562 |  |  | $ | 745 |
The provision for income taxes differs from the amount computed by applying the statutory income tax rate to income before taxes due to the following for the years ended December 31, 2022, 2021 and 2020:
In thousands |  | 2022 |  |  | 2021 |  |  | 2020 |
Benefits from taxes at statutory rate | $ | (25,952 | ) |  | $ | 2,823 |  |  | $ | (4,314 | )
Rate differential |  | 9,141 |  |  |  | (4,416 | ) |  |  | 128 |
Change in valuation reserves |  | 5,083 |  |  |  | (546 | ) |  |  | 22,865 |
Nondeductible employee compensation |  | 2,344 |  |  |  | 5,249 |  |  |  | 6,122 |
Stock option/RSU windfall (shortfall) |  | 3,569 |  |  |  | 81 |  |  |  | (3,262 | )
ISO disqualifying disposition windfall |  | — |  |  |  | (219 | ) |  |  | (253 | )
Research and development credits |  | (958 | ) |  |  | (1,170 | ) |  |  | (6,225 | )
Tax return to provision adjustments |  | 424 |  |  |  | (8,372 | ) |  |  | (138 | )
Net operating loss carryback |  | — |  |  |  | — |  |  |  | (2,465 | )
Foreign exchange |  | 7,859 |  |  |  | 4,109 |  |  |  | (10,852 | )
Permanent and other |  | (1,542 | ) |  |  | 863 |  |  |  | (4,283 | )
Uncertain tax positions |  | (3,290 | ) |  |  | 5,160 |  |  |  | 3,422 |
Foreign-derived intangible income |  | (2,935 | ) |  |  | — |  |  |  | — |
Loss of tax attributes |  |  |  | 8,255 |  |  |  | — |  |  |  | — |
Provision for income taxes | $ | 1,998 |  |  | $ | 3,562 |  |  | $ | 745 |
The Company is subject to a corporate tax rate in Ireland of 25% for non-trading activities and 12.5% for trading activities. For the years ended December 31, 2022, 2021, and 2020, the Company applied the statutory corporate tax rate of 25% for Amarin Corporation plc, reflecting the non-trading tax rate in Ireland. However, for Amarin Pharmaceuticals Ireland Limited, a wholly-owned subsidiary of Amarin Corporation plc, the Company applied the 12.5% Irish trading tax rate. In the table above, the Company used Amarin Corporat ion plc’s 25% tax rate as the starting point for the reconciliation since it is the parent entity of the business. On August 16, 2022, the Inflation Reduction Act of 2022, or the Act, was signed into law by the Biden Administration, with tax provisions effective January 1, 2023 primarily focused on implementing a 15% minimum tax on global adjusted financial statement income (CAMT) and a 1% excise tax on share repurchases. While we are still evaluating the impact of the Act, we do not expect either of these provisions to have a material impact on our financial results. On March 27, 2020, the Coronavirus Aid, Relief and Economic Security Act, or CARES Act, was enacted in the United States. Among other provisions, the CARES Act allows businesses to carry back net operating losses arising in years 2018 to 2020 to the five prior tax years. We recorded an income tax benefit of $2.5 million for the year ended December 31, 2020 as a result of these loss carrybacks and an income tax benefit of nil for the years ended December 31, 2022 and 2021, respectively. In April 2016, the Company adopted ASU No. 2016-09, Compensation-Stock Compensation (Topic 718): Improvements to Share-Based Payment Accounting which changes the accounting for certain aspects of share-based payments to employees. One aspect of the standard requires that excess tax benefits and deficiencies that arise upon vesting or exercise of share-based payments be recognized as an income tax benefit and expense in the income statement. Previously, such amounts were recognized as an increase and decrease in additional paid-in capital. This aspect of the standard was adopted prospectively, and accordingly the provisions for income taxes for the years ended December 31, 2022, 2021 and 2020 includes $0.6 million, $0.1 million and $3.7 million of excess tax benefits, respectively, arising from share-based payments during the period. The income tax effect of each type of temporary difference comprising the net deferred tax asset as of December 31, 2022 and 2021 is as follows:
In thousands |  | December 31, 2022 |  |  | December 31, 2021 |
Deferred tax assets: |  |  |  |  |  |
Net operating losses |  | $ | 136,862 |  |  | $ | 127,378 |
Stock-based compensation |  |  | 11,616 |  |  |  | 8,563 |
Tax credits |  |  | 2,639 |  |  |  | 15,803 |
Capitalized R&D |  |  |  | 4,723 |  |  |  | — |
Lease liability |  |  | 2,583 |  |  |  | 2,348 |
Other reserves and accrued liabilities |  |  | 11,895 |  |  |  | 11,257 |
Gross deferred tax assets |  |  | 170,318 |  |  |  | 165,349 |
Less: valuation allowance |  |  | (165,378 | ) |  |  | (160,295 | )
Total deferred tax assets |  |  | 4,940 |  |  |  | 5,054 |
Deferred tax liabilities: |  |  |  |  |  |
Depreciation and amortization |  |  | (3,337 | ) |  |  | (3,404 | )
Lease asset |  |  |  | (1,603 | ) |  |  | (1,639 | )
Other liabilities |  |  |  | — |  |  |  | (11 | )
Total deferred tax liabilities |  |  | (4,940 | ) |  |  | (5,054 | )
Net deferred tax assets |  | $ | — |  |  | $ | — |
The Company assesses whether it is more-likely-than-not that the Company will realize its deferred tax assets. The Company determined that it was more-likely-than-not that the Irish, U.S., Germany, and Israeli net operating losses and the related deferred tax assets would not be realized in future periods and a full valuation allowance has been provided for all periods. The following table reflects the activity in the valuation allowance for the years ended December 31, 2022 and 2021:
In thousands |  | 2022 |  |  | 2021 |
Beginning valuation allowance | $ | 160,295 |  |  | $ | 160,841 |
Increase as reflected in income tax expense |  | 12,942 |  |  |  | 2,899 |
Foreign exchange |  | (7,859 | ) |  |  | (3,445 | )
Ending valuation allowance | $ | 165,378 |  |  | $ | 160,295 |
During 2022, the Company recorded adjustments to its deferred tax accounts related to the impact of foreign exchange rate changes and to reconcile the financial statement accounts to the amounts expected to result in future income and deductions under local law, primarily as it relates to Irish net operating losses and deferred taxes for stock compensation. These adjustments were fully offset with valuation allowances based on the Company’s position with respect to the realizability of its recorded deferred tax assets. The Company has combined U.S. and Non-U.S. net operating loss carryforwards of $834.4 million, which do not expire. The total net operating loss carryforwards decreased by approximately $15.6 million from the prior year primarily as a result of current year loss generated by the Company’s U.S. and Non-U.S. subsidiaries, the impact of foreign exchange rate changes, and adjustments to reconcile the financial statement accounts to the amounts reported on the filed 2021 foreign tax returns. In addition, the Company has U.S. Federal tax credit carryforwards of $9.5 million and state tax credit carryforwards of $3.7 million. These amounts exclude the impact of any unrecognized tax benefits and valuation allowances. These carryforwards, which will expire between 2023 and 2042, may be used to offset future taxable income, if any. As of December 31, 2022, there are no earnings that have been retained indefinitely for reinvestment by foreign subsidiary; therefore, no provision has been made for income taxes that would be payable upon the distribution of such earnings or the recovery of the Company’s investment in its subsidiaries as the amount of the related unrecognized deferred income tax liability is zero. The Company's and its subsidiaries' income tax returns are periodically examined by various taxing authorities. The Company is currently under audit by the IRS for the Company’s 2018 U.S. income tax return, by the New Jersey Department of Treasury for the years 2012 to 2015 and by the New York Department of Finance for the years 2018 and 2019. Although the outcome of tax audits is always uncertain and could result in significant cash tax payments, the Company does not believe the outcome of these audits will have a material adverse effect on the Company's consolidated financial position or results of operations.

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