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Collaboration Agreements
3 Months Ended
Mar. 31, 2016
Collaboration Agreements [Abstract]  
Collaboration Agreements
Collaboration Agreements

Alnylam Pharmaceuticals, Inc.

In February 2013, the Company entered into a license and collaboration agreement with Alnylam Pharmaceuticals, Inc. (“Alnylam”) to develop, manufacture, and commercialize therapeutic products targeting the proprotein convertase subtilisin/kexin type 9 (“PCSK9”) gene, based on certain of Alnylam’s RNA interference (“RNAi”) technology. Under the terms of the agreement, the Company obtained the exclusive, worldwide right under Alnylam’s technology to develop, manufacture, and commercialize PCSK-9 products for the treatment, palliation and/or prevention of all human diseases. Alnylam was responsible for the development costs of the products, subject to an agreed upon limit, until the completion of Phase 1 clinical studies. The Company is responsible for completing and funding the development costs of the products through commercialization, if successful. The Company paid Alnylam $25 million in an initial license payment which the Company recorded as research and development expense. The Company has also agreed to pay up to an aggregate of $180 million in success-based development and commercialization milestones. In addition, the Company has agreed to pay specified royalties on net sales of these products. Royalties to Alnylam are payable by the Company on a product-by-product and country-by-country basis until the last to occur of the expiration of patent rights in the applicable country that cover the applicable product, the expiration of non-patent regulatory exclusivities for such product in such country, and the twelfth anniversary of the first commercial sale of the product in such country, subject to reduction in specified circumstances. The Company is also responsible for paying royalties, and in some cases, milestone payments, owed by Alnylam to its licensors with respect to intellectual property covering these products. In December 2014, under the terms of the license and collaboration agreement with Alnylam, Alnylam initiated a Phase 1 clinical trial of ALN-PCSsc in the UK. Upon initiation of the Phase I clinical trial, the Company incurred a $10.0 million milestone which it recorded as research and development expense.

SciClone Pharmaceuticals

On December 16, 2014, the Company entered into a strategic collaboration with SciClone Pharmaceuticals (“SciClone”) under which the Company granted SciClone a license and the exclusive rights to promote, market, and sell Angiomax and Cleviprex in China. Under the terms of the collaboration, SciClone will be responsible for all aspects of commercialization, including pre- and post-launch activities, for both products in the China market (excluding Hong Kong and Macau) and will assist the Company in the registration process for both products in China. The Company has filed in China for marketing approval of Angiomax and to conduct clinical trials of Cleviprex. SciClone agreed to pay the Company an upfront payment of $10.0 million, a product support services fee and regulatory/commercial success milestone payments of up to an aggregate of $50.5 million, and royalties based on net sales of Angiomax and Cleviprex in China.

Activities under the SciClone agreement were evaluated to determine if they represented a multiple element revenue arrangement. The SciClone agreement includes the following deliverables: (1) an exclusive license to commercialize Angiomax and Cleviprex in China, excluding Hong Kong and Macau; (2) the Company’s obligation to conduct research and development activities related to the approvals of Angiomax and Cleviprex; and (3) the Company’s obligation to participate on the joint operating committee established under the terms of the SciClone agreement and related subcommittees. All of these deliverables were deemed to have stand-alone value and to meet the criteria to be accounted for as separate units of accounting. Factors considered in this determination included, among other things, the subject of the licenses and the research and development and commercial capabilities of SciClone. Accordingly, each unit will be accounted for separately. For the three months ended March 31, 2016 and 2015, the Company recorded approximately $0.1 million and $7.8 million, respectively, of revenue associated with the SciClone agreement as co-promotion and license income.

The Company believes the regulatory approval milestones that may be achieved under the SciClone agreement are consistent with the definition of a milestone, and accordingly, the Company will recognize payments related to the achievement of such milestones, if any, when the applicable milestones are achieved. Factors considered in this determination included scientific and regulatory risks that must be overcome to achieve each milestone, the level of effort and investment required to achieve each milestone, and the monetary value attributed to each milestone.
Symbio Pharmaceuticals Limited
On October 2, 2015, the Company entered into strategic collaboration with Symbio Pharmaceuticals Limited (“Symbio”) under which the Company granted Symbio a license and the exclusive rights to promote, market, and sell Ionsys in Japan. Under the terms of the collaboration, Symbio will be responsible for all aspects of commercialization, including pre- and post-launch activities, for both products in the Japan market and will assist the Company in the registration process for Ionsys. Symbio paid the Company an upfront payment of $10.0 million, regulatory/commercial success milestone payments of up to an aggregate of $20.9 million, and royalties based on net sales of Ionsys in Japan.
Factors considered in the determination of deliverables included, among other things, the subject of the licenses and the research and development and commercial capabilities of Symbio. For the three months ended March 31, 2016, the Company recorded approximately $0.6 million of revenue associated with the Symbio agreement as co-promotion and license income.
The Company believes the regulatory approval milestones that may be achieved under the Symbio agreement are consistent with the definition of a milestone and, accordingly, the Company will recognize payments related to the achievement of such milestones, if any, when the applicable milestones are achieved.