Revenue from Contracts with Customers

3 Months Ended

Mar. 31, 2024

Revenue from Contract with Customer [Abstract]

Revenue from Contracts with Customers

4. REVENUE FROM CONTRACTS WITH CUSTOMERS

Product Sales, Net

During the three months ended March 31, 2024 and 2023, the Company recorded product sales, net, as follows:

	Three Months Ended March 31,
(In thousands)	2024		2023
VIVITROL	$	97,659	$	96,659
ARISTADA and ARISTADA INITIO		78,870		80,077
LYBALVI		57,007		37,991
Total product sales, net	$	233,536	$	214,727

Manufacturing and Royalty Revenues

During the three months ended March 31, 2024 and 2023, the Company recorded manufacturing and royalty revenues from its collaboration arrangements as follows:

	Three Months Ended March 31, 2024
(In thousands)	Manufacturing Revenue		Royalty Revenue		Total
Long-acting INVEGA products(1)	$	—	$	62,673	$	62,673
VUMERITY		12,124		19,130		31,254
Other		17,906		5,000		22,906
	$	30,030	$	86,803	$	116,833

	Three Months Ended March 31, 2023
(In thousands)	Manufacturing Revenue		Royalty Revenue		Total
Long-acting INVEGA products(1)	$	—	$	13,562	$	13,562
VUMERITY		12,649		16,225		28,874
Other		25,791		4,635		30,426
	$	38,440	$	34,422	$	72,862

(1)“long-acting INVEGA products”: INVEGA SUSTENNA/XEPLION (paliperidone palmitate), INVEGA TRINZA/TREVICTA (paliperidone palmitate) and INVEGA HAFYERA/BYANNLI (paliperidone palmitate).

In November 2021, the Company received notice of partial termination of an exclusive license agreement with Janssen Pharmaceutica N.V., a subsidiary of Johnson & Johnson (“Janssen Pharmaceutica”). Under this license agreement, the Company provided Janssen Pharmaceutica with rights to, and know-how, training and technical assistance in respect of, the Company’s small particle pharmaceutical compound technology, known as NanoCrystal technology, which was used to develop the long-acting INVEGA products. When the partial termination became effective in February 2022, Janssen Pharmaceutica ceased paying royalties related to sales of INVEGA SUSTENNA, INVEGA TRINZA and INVEGA HAFYERA. Accordingly, the Company ceased recognizing royalty revenue related to sales of these products in February 2022. In April 2022, the Company commenced binding arbitration proceedings related to, among other things, Janssen Pharmaceutica’s partial termination of this license agreement and Janssen Pharmaceutica’s royalty and other obligations under the agreement. In May 2023, the arbitral tribunal (the “Tribunal”) in the arbitration proceedings issued a final award (the “Final Award”) which concluded the arbitration proceedings. The Final Award provided, among other things, that the Company was due back royalties and late-payment interest related to 2022 U.S. net sales of the long-acting INVEGA products, which payments were received from Janssen Pharmaceutica in the second quarter of 2023, and is entitled to 2023 and future royalty revenues from Janssen Pharmaceutica related to net sales of INVEGA SUSTENNA through August 20, 2024, INVEGA TRINZA through the second quarter of 2030 (but no later than May 2030 when the license agreement expires) and INVEGA HAFYERA through May 2030 (when the license agreement expires).

Following issuance of the Final Award, the Company recognized royalty revenues related to the back royalties and resumed recognizing royalty revenue related to ongoing U.S. sales of the long-acting INVEGA products.

Contract Assets

Contract assets include unbilled amounts related to the manufacture of a product that, once complete, will be sold under certain of the Company’s manufacturing contracts. The amounts included in the contract assets table below are classified as “Current assets” in the accompanying condensed consolidated balance sheets, as they relate to manufacturing processes that are completed in ten days to eight weeks.

Total contract assets at March 31, 2024 were as follows:

(In thousands)	Contract Assets
Contract assets at December 31, 2023	$	706
Additions		1,229
Transferred to receivables, net		(706	)
Contract assets at March 31, 2024	$	1,229

Contract Liabilities

Contract liabilities consist of contractual obligations related to deferred revenue. At March 31, 2024 and December 31, 2023, $3.3 million and $2.7 million of the contract liabilities, respectively, were classified as “Contract liabilities–short-term” in the accompanying condensed consolidated balance sheets and $1.2 million and $2.1 million of the contract liabilities, respectively, were classified as “Other long-term liabilities” in the accompanying condensed consolidated balance sheets.

Total contract liabilities at March 31, 2024 were as follows:

(In thousands)	Contract Liabilities
Contract liabilities at December 31, 2023	$	4,775
Additions		—
Amounts recognized into revenue		(208	)
Contract liabilities at March 31, 2024	$	4,567