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Balance Sheet Components | 6 Months Ended
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Jun. 30, 2020
Organization Consolidation And Presentation Of Financial Statements [Abstract] |
Balance Sheet Components |
5. | Balance Sheet Components
Cash and Cash Equivalents Cash and cash equivalents consisted of the following (in thousands):
|  | June 30, 2020 |  |  | December 31, 2019 |
Cash |  | $ | 198,708 |  |  | $ | 40,715 |
Money market funds |  |  | 230,561 |  |  |  | 85,551 |
Total cash and cash equivalents |  | $ | 429,269 |  |  | $ | 126,266 |
At June 30, 2020 and December 31, 2019, a total of $32.8 million and $11.9 million, respectively, of the Company’s cash and cash equivalents were held outside of the U.S. in its foreign subsidiaries to be used primarily for its China operations. Investments The Company’s investments consist of available-for-sale debt investments, marketable equity investments, term deposit and certificate of deposit. The amortized cost, gross unrealized holding gains or losses, and fair value of the Company’s investments by major investments type are summarized in the tables below (in thousands):
|  | June 30, 2020 |
|  | Amortized Cost |  |  | Gross Unrealized Holding Gains |  |  | Gross Unrealized Holding Losses |  |  | Fair Value |
U.S. treasury notes and bills |  | $ | 225,117 |  |  | $ | 1,062 |  |  | $ | — |  |  | $ | 226,179 |
Certificates of deposit |  |  | 30,000 |  |  |  | 138 |  |  |  | — |  |  |  | 30,138 |
Equity investments |  |  | 125 |  |  |  | 104 |  |  |  | — |  |  |  | 229 |
Total investments |  | $ | 255,242 |  |  | $ | 1,304 |  |  | $ | — |  |  | $ | 256,546 |
|  | December 31, 2019 |
|  | Amortized Cost |  |  | Gross Unrealized Holding Gains |  |  | Gross Unrealized Holding Losses |  |  | Fair Value |
U.S. treasury notes and bills |  | $ | 426,995 |  |  | $ | 536 |  |  | $ | (25 | ) |  | $ | 427,506 |
Certificates of deposit |  |  | 30,000 |  |  |  | 32 |  |  |  | — |  |  |  | 30,032 |
Bond and mutual funds |  |  | 10,730 |  |  |  | 86 |  |  |  | — |  |  |  | 10,816 |
Equity investments |  |  | 125 |  |  |  | 130 |  |  |  | — |  |  |  | 255 |
Total investments |  | $ | 467,850 |  |  | $ | 784 |  |  | $ | (25 | ) |  | $ | 468,609 |
At June 30, 2020, all of the available-for-sale investments had contractual maturities within one year. During the three and six months ended June 30, 2020 and 2019, the Company did not recognize any other-than-temporary impairment loss. Inventories Inventories consisted of the following (in thousands):
|  | June 30, 2020 |  |  | December 31, 2019 |
Raw materials |  | $ | 327 |  |  | $ | 325 |
Work-in-progress |  |  | 3,815 |  |  |  | 2,264 |
Finished goods |  |  | 4,440 |  |  |  | 4,298 |
Total inventories |  | $ | 8,582 |  |  | $ | 6,887 |
The provision to write-down excess and obsolete inventory was immaterial for the three and six months ended June 30, 2020. Prepaid expenses and other current assets Prepaid expenses and other current assets consisted of the following (in thousands):
|  | June 30, 2020 |  |  | December 31, 2019 |
Unbilled contract assets |  | $ | — |  |  | $ | 180,000 |
Deferred revenues from associated contracts |  |  | — |  |  |  | (54,790 | )
Net unbilled contract assets |  |  | — |  |  |  | 125,210 |
Prepaid assets |  |  | 4,429 |  |  |  | 6,464 |
Other current assets |  |  | 2,052 |  |  |  | 1,717 |
Total prepaid expenses and other current assets |  | $ | 6,481 |  |  | $ | 133,391 |
The unbilled contract assets as of December 31, 2019 included two regulatory milestones totaling $130.0 million under the Europe Agreement with Astellas associated with the planned MAA submission in Europe. The MAA was submitted in the second quarter of 2020. Therefore the $130 million milestones were billed in the same quarter. The unbilled contract assets as of December 31, 2019 also included a $50.0 million regulatory milestone under the U.S./RoW Agreement with AstraZeneca associated with the NDA submission in the U.S, which was submitted in December 2019 and accepted for review in February 2020. Therefore, the $50.0 million milestone was billed during the first quarter of 2020. See Note 2 for details. Property and Equipment Property and equipment consisted of the following (in thousands):
|  | June 30, 2020 |  |  | December 31, 2019 |
Leasehold improvements |  | $ | 100,159 |  |  | $ | 101,548 |
Laboratory equipment |  |  | 17,362 |  |  |  | 17,329 |
Machinery |  |  | 7,660 |  |  |  | 8,217 |
Computer equipment |  |  | 8,930 |  |  |  | 8,399 |
Furniture and fixtures |  |  | 5,873 |  |  |  | 5,822 |
Construction in progress |  |  | 1,225 |  |  |  | 1,792 |
Total property and equipment |  | $ | 141,209 |  |  | $ | 143,107 |
Less: accumulated depreciation |  |  | (104,225 | ) |  |  | (100,364 | )
Property and equipment, net |  | $ | 36,984 |  |  | $ | 42,743 |
Accrued Liabilities Accrued liabilities consisted of the following (in thousands):
|  | June 30, 2020 |  |  | December 31, 2019 |
Preclinical and clinical trial accruals |  | $ | 21,691 |  |  | $ | 16,279 |
API product price adjustment |  |  | — |  |  |  | 36,324 |
Payroll and related accruals |  |  | 14,266 |  |  |  | 19,784 |
Property taxes and other |  |  | 1,145 |  |  |  | 2,044 |
Professional services |  |  | 5,653 |  |  |  | 4,842 |
Other |  |  | 7,709 |  |  |  | 4,543 |
Total accrued liabilities |  | $ | 50,464 |  |  | $ | 83,816 |
The amount of $36.3 million accrued as of December 31, 2019 was related to the change in estimated variable consideration of API product at the time the roxadustat listed price was issued by the Japanese Ministry of Health, Labour and Welfare. The amount was fully paid during the first quarter of 2020. Other Long-term Liabilities Other long-term liabilities consisted of the following (in thousands):
|  | June 30, 2020 |  |  | December 31, 2019 |
Accrued long-term co-promotional expenses |  | $ | 116,230 |  |  | $ | 53,071 |
Other long-term tax liabilities |  |  | 8,653 |  |  |  | 8,913 |
Operating lease liabilities, non-current |  |  | 572 |  |  |  | 942 |
Other |  |  | 1,787 |  |  |  | 1,340 |
Total other long-term liabilities |  | $ | 127,242 |  |  | $ | 64,266 |
The accrued long-term co-promotional expenses of $116.2 million and $53.1 million as of June 30, 2020 and December 31, 2019, respectively, were related to the estimated amount payable to AstraZeneca for its sales and marketing efforts associated with the commercial launch and sales for roxadustat in China. The payment for such amount is not expected to occur within the next year. On July 8, 2020, the Parties into an amendment to the China Agreement, relating to the development and commercialization of roxadustat in China. As a result, such accrued long-term co-promotional expenses will be reduced by approximately $82 million in the third quarter of 2020. See Note 10 for details.

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