Organization and Basis of Presentation	6 Months Ended
Jun. 30, 2019
Organization and Basis of Presentation
Organization and Basis of Presentation	NOTE 1. ORGANIZATION AND BASIS OF PRESENTATION Ardelyx, Inc. (the “Company,” “we,” “us” or “our”) is a specialized biopharmaceutical company focused on developing first-in-class medicines to improve treatment choices for people with cardiorenal diseases. Tenapanor, a first-in-class inhibitor of NHE3, is being evaluated in a Phase 3 clinical program, including, the PHREEDOM trial, a second Phase 3 clinical trial evaluating tenapanor as a monotherapy treatment for hyperphosphatemia in patients with end-stage renal disease, or ESRD, who are on dialysis, and in the AMPLIFY trial, a Phase 3 clinical trial evaluating tenapanor’s efficacy in combination with phosphate binders. The Company is also advancing a small molecule potassium secretagogue program, RDX013, for the potential treatment of hyperkalemia. In November 2018, the Company’s New Drug Application, or NDA, for tenapanor for the treatment of people with irritable bowel syndrome with constipation, or IBS-C, was accepted for substantive review by the United States Food and Drug Administration, or FDA. The Company operates in only one business segment, which is the development of biopharmaceutical products. Basis of Presentation These unaudited condensed consolidated financial statements and the related footnote information of the Company have been prepared pursuant to the requirements of the Securities and Exchange Commission, or the SEC, for interim reporting. As permitted under those rules and regulations, certain footnotes or other financial information that are normally required by U.S. generally accepted accounting principles, or U.S. GAAP, have been condensed or omitted pursuant to such rules and regulations. In the opinion of the Company’s management, the accompanying interim unaudited condensed consolidated financial statements include all adjustments (consisting only of normal recurring adjustments) necessary for a fair presentation of the information for the periods presented. The results for the three and six months ended June 30, 2019, are not necessarily indicative of results to be expected for the entire year ending December 31, 2019, or future operating periods. The accompanying condensed consolidated financial statements and related financial information should be read in conjunction with the audited consolidated financial statements and the related notes thereto for the year ended December 31, 2018, included in the Company’s Annual Report on Form 10‑K filed with the SEC (the “2018 Form 10‑K”). The balance sheet at December 31, 2018, has been derived from the audited consolidated financial statements at that date, as filed with the 2018 Form 10‑K. The accompanying condensed consolidated financial statements include the accounts of Ardelyx, Inc. and its wholly-owned subsidiary, Ardelyx Cayman Islands, which was placed into voluntary liquidation in December 2017 and dissolved in April 2018, have been prepared in accordance with U.S. GAAP. Intercompany transactions and balances have been eliminated upon consolidation. Prior Period Errors During the second quarter of 2019, errors were identified in our consolidated financial statements for the quarter ended March 31, 2019, for year ended December 31, 2018 and for each of the quarterly periods ended March 31, 2018, June 30, 2018 and September 30, 2018. The errors were related to the accounting for clinical trial accruals, and resulted in an overstatement of research and development expenses during these periods. Research and development expenses were overstated by $0.2 million, $0.9 million, $1.1 million, $1.4 million and $0.5 million for the three-month periods ended March 31, 2018, June 30, 2018, September 30, 2018, December 31, 2018 and March 31, 2019, respectively. As of December 31, 2018, accrued and other liabilities was overstated by $3.6 million. The Company analyzed the potential impact of these errors and concluded that while the accumulated errors were significant to the results for the three months ended June 30, 2019, a correction of the errors would not be material to any individual prior period, taking into account the requirements of the Securities and Exchange Commission (SEC) Staff Accounting Bulletin No. 108, Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements. In accordance with the authoritative guidance, management evaluated the materiality of the errors from a qualitative and quantitative perspective. Based on such evaluation, the Company concluded that correcting the cumulative errors for the year ended December 31, 2018 is expected to be immaterial to the currently estimated full year results for 2019 and a correction of the errors would not have a material impact on the periods ended March 31, 2018, June 30, 2018, September 30, 2018, December 31, 2018 and March 31, 2019 or affect the trend of financial results. Accordingly, during the second quarter of 2019, the Company reduced accrued and other liabilities by $4.1 million and recorded a cumulative adjustment of $4.1 million in the condensed consolidated statement of operations to reduce research and development expenses.

NOTE 1. ORGANIZATION AND BASIS OF PRESENTATION

Ardelyx, Inc. (the “Company,” “we,” “us” or “our”) is a specialized biopharmaceutical company focused on developing first-in-class medicines to improve treatment choices for people with cardiorenal diseases. Tenapanor, a first-in-class inhibitor of NHE3, is being evaluated in a Phase 3 clinical program, including, the PHREEDOM trial, a second Phase 3 clinical trial evaluating tenapanor as a monotherapy treatment for hyperphosphatemia in patients with end-stage renal disease, or ESRD, who are on dialysis, and in the AMPLIFY trial, a Phase 3 clinical trial evaluating tenapanor’s efficacy in combination with phosphate binders. The Company is also advancing a small molecule potassium secretagogue program, RDX013, for the potential treatment of hyperkalemia. In November 2018, the Company’s New Drug Application, or NDA, for tenapanor for the treatment of people with irritable bowel syndrome with constipation, or IBS-C, was accepted for substantive review by the United States Food and Drug Administration, or FDA.

The Company operates in only one business segment, which is the development of biopharmaceutical products.

Basis of Presentation

These unaudited condensed consolidated financial statements and the related footnote information of the Company have been prepared pursuant to the requirements of the Securities and Exchange Commission, or the SEC, for interim reporting. As permitted under those rules and regulations, certain footnotes or other financial information that are normally required by U.S. generally accepted accounting principles, or U.S. GAAP, have been condensed or omitted pursuant to such rules and regulations. In the opinion of the Company’s management, the accompanying interim unaudited condensed consolidated financial statements include all adjustments (consisting only of normal recurring adjustments) necessary for a fair presentation of the information for the periods presented. The results for the three and six months ended June 30, 2019, are not necessarily indicative of results to be expected for the entire year ending December 31, 2019, or future operating periods.

The accompanying condensed consolidated financial statements and related financial information should be read in conjunction with the audited consolidated financial statements and the related notes thereto for the year ended December 31, 2018, included in the Company’s Annual Report on Form 10‑K filed with the SEC (the “2018 Form 10‑K”). The balance sheet at December 31, 2018, has been derived from the audited consolidated financial statements at that date, as filed with the 2018 Form 10‑K.

The accompanying condensed consolidated financial statements include the accounts of Ardelyx, Inc. and its wholly-owned subsidiary, Ardelyx Cayman Islands, which was placed into voluntary liquidation in December 2017 and dissolved in April 2018, have been prepared in accordance with U.S. GAAP. Intercompany transactions and balances have been eliminated upon consolidation.

Prior Period Errors

During the second quarter of 2019, errors were identified in our consolidated financial statements for the quarter ended March 31, 2019, for year ended December 31, 2018 and for each of the quarterly periods ended March 31, 2018, June 30, 2018 and September 30, 2018. The errors were related to the accounting for clinical trial accruals, and resulted in an overstatement of research and development expenses during these periods. Research and development expenses were overstated by $0.2 million, $0.9 million, $1.1 million, $1.4 million and $0.5 million for the three-month periods ended March 31, 2018, June 30, 2018, September 30, 2018, December 31, 2018 and March 31, 2019, respectively. As of December 31, 2018, accrued and other liabilities was overstated by $3.6 million.

The Company analyzed the potential impact of these errors and concluded that while the accumulated errors were significant to the results for the three months ended June 30, 2019, a correction of the errors would not be material to any individual prior period, taking into account the requirements of the Securities and Exchange Commission (SEC) Staff Accounting Bulletin No. 108, Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements. In accordance with the authoritative guidance, management evaluated the materiality of the errors from a qualitative and quantitative perspective. Based on such evaluation, the Company concluded that correcting the cumulative errors for the year ended December 31, 2018 is expected to be immaterial to the currently estimated full year results for 2019 and a correction of the errors would not have a material impact on the periods ended March 31, 2018, June 30, 2018, September 30, 2018, December 31, 2018 and March 31, 2019 or affect the trend of financial results. Accordingly, during the second quarter of 2019, the Company reduced accrued and other liabilities by $4.1 million and recorded a cumulative adjustment of $4.1 million in the condensed consolidated statement of operations to reduce research and development expenses.