The components of income (loss) before income taxes were as follows (in thousands):

	Years Ended December 31,
	2021			2020			2019
United States	$	141,303		$	(105,960	)	$	(97,435	)
Foreign		(56	)		(50	)		(53	)
Total income (loss) before income taxes	$	141,247		$	(106,010	)	$	(97,488	)

The components of the provision for income tax expense (benefit) were as follows (in thousands):

	Years Ended December 31,
	2021		2020		2019
Current:
Federal	$	4,107	$	—	$	—
State		9,300		5,240		(2,288	)
Foreign		—		—		—
Total current		13,407		5,240		(2,288	)
Deferred:
Federal		—		—		(284	)
State		—		—		(183	)
Foreign		—		—		—
Total deferred		—		—		(467	)
Total income tax expense (benefit)	$	13,407	$	5,240	$	(2,755	)

In response to the COVID-19 pandemic, the Coronavirus Aid, Relief and Economic Security Act (the CARES Act) was signed into law in March 2020. The CARES Act (i) lifted certain deduction limitations originally imposed by the TCJA, (ii) allowed corporate taxpayers to carryback net operating losses (NOLs) originating during 2018 through 2020 for up to five years, which was not previously allowed under the TCJA, (iii) eliminated the 80% of taxable income limitations on NOL utilization imposed by the TCJA, allowing corporate entities to fully utilize NOL carryforwards to offset taxable income in 2018, 2019 or 2020, and (iv) enacted various other changes to corporate taxation. Also included in the CARES Act was a change to the TCJA related to qualified

improvement property, retroactively allowing for a 15-year recovery period and bonus depreciation. As a result of this change, the Company recorded current income tax benefit of $0.5 million for the year ended December 31, 2020 related to a reduction of state taxes associated with additional depreciation deductions allowed for the 2018 tax year. Overall, the enactment of the CARES Act, including the change for qualified improvement property, did not result in any material adjustments to the Company’s income tax provision for the year ended December 31, 2020.

Beginning in 2022, the TCJA eliminates the option to deduct research and development expenses currently and requires taxpayers to amortize such costs over a period of five years. While the Federal government is currently considering legislation that would defer or repeal this provision, there is no assurance such legislation will be enacted. The Company does not currently expect this provision of the TCJA will have a material impact on its tax position or operating cash flows for the year ended December 31, 2022, however, the actual impact of this provision to future periods is uncertain as of this time.

The following table presents a reconciliation of income tax expense (benefit) computed at the statutory federal income tax rate of 21% to income tax expense (benefit) reported in the consolidated statements of operations and comprehensive income (loss) (in thousands):

	Years Ended December 31,
	2021			2020			2019
Federal income tax expense (benefit) at statutory rate	$	29,662		$	(22,263	)	$	(20,473	)
State income tax expense (benefit), net of federal tax effect		9,183			(11,495	)		(15,323	)
Research and development credits		(10,059	)		(7,793	)		(11,075	)
Stock-based compensation		755			587			(2,134	)
Executive compensation		1,511			202			—
Other non-deductible expenses and reconciling items		329			684			144
Change in corporate tax rates		14,772			109			130
Change in valuation allowance		(32,746	)		45,209			45,976
Total income tax expense (benefit)	$	13,407		$	5,240		$	(2,755	)

The significant components of the Company’s net deferred tax assets were as follows (in thousands):

	As of December 31,
	2021			2020
Deferred tax assets:
Net operating loss carryforwards	$	3,981		$	14,683
Research and development tax credits		45,576			47,970
Stock-based compensation		18,303			15,644
Lease liabilities		23,430			21,961
Liability related sale of future royalties		43,234			62,089
Accruals and other		6,230			7,370
Total deferred tax assets before valuation allowance		140,754			169,717
Valuation allowance		(110,756	)		(142,907	)
Total deferred tax assets		29,998			26,810
Deferred tax liabilities:
Unrealized gains on marketable securities		—			(163	)
Right-of-use assets		(16,363	)		(21,094	)
Depreciation and amortization		(13,635	)		(5,155	)
Other		—			(398	)
Total deferred tax liabilities		(29,998	)		(26,810	)
Net deferred tax assets	$	—		$	—

The Company evaluated the positive and negative evidence bearing upon the realizability of its deferred tax assets as of December 31, 2021 and 2020. Based on the Company’s history of operating losses, and other relevant facts and circumstances, the Company concluded that it was more likely than not that the benefit of its deferred tax assets will not be realized. Accordingly, the Company provided a full valuation allowance for its net deferred tax assets as of December 31, 2021 and 2020. The valuation allowance increased (decreased) by $(32.2) million and $45.4 million during the years ended December 31, 2021 and 2020, respectively. The decrease in the valuation allowance during the year ended December 31, 2021 was due primarily to the utilization of

federal and state NOLs and research and development tax credit carryforwards, a decrease in the deferred tax asset for the liability related to the sale of future royalties and other decreases in net deferred tax assets during the period. The increase in the valuation allowance during the year ended December 31, 2020 was due primarily to an increase in deferred tax assets resulting from the sale of the Company’s Zolgensma royalty rights to HCR in December 2020, which was treated as a sale for tax purposes, research and development credits generated during the period, stock-based compensation expense and realized gains on sales of marketable securities, the impact of which was partially offset by the utilization of federal and state NOLs during the period.

As of December 31, 2021 and 2020, the Company had U.S. federal NOL carryforwards of zero and approximately $44.7 million, respectively, and U.S. state NOL carryforwards of approximately $59.9 million and $79.7 million, respectively, which may be available to offset future income tax liabilities. A portion of the Company’s U.S. state NOL carryforwards as of December 31, 2021 may be carried forward indefinitely, with the remaining portion expiring at various dates between 2034 and 2041.

As of December 31, 2021 and 2020, the Company had U.S. federal and state research and development tax credit carryforwards of approximately $45.6 million and $48.0 million, respectively, net of unrecognized tax benefits of $0.1 million and $0.1 million, respectively, which may be available to reduce future income tax liabilities and expire at various dates between 2035 and 2041. The calculation of these credits requires assumptions to be made by the Company to estimate qualified research expenses. The Company conducts formal studies to document the qualified activities and expenses used to calculate these credits, however a portion of these credits may be subject to future studies which have not yet occurred, the results of which may result in an adjustment to the Company’s credit carryforwards. The Company accounts for uncertain tax positions in accordance with the requirements of ASC 740, and recognizes the tax benefit of tax positions to the extent that the benefit will more likely than not be realized. As of December 31, 2021 and 2020, the Company had total unrecognized tax benefits of $0.1 million and $0.1 million, respectively, which were reserved against its research and development tax credit carryforwards as uncertain tax positions. No reserve for uncertain tax positions has been placed against qualified expenses for which a study has not been conducted. However, a full valuation allowance has been provided against the net credit carryforwards and, if an adjustment is required upon the completion of the study, this adjustment would be offset by an adjustment to the deferred tax asset established for the research and development credit carryforwards and the valuation allowance. If these unrecognized tax benefits were to be recognized, the impact would be offset by an adjustment to the valuation allowance, resulting in no impact on the Company’s effective tax rate. The Company does not expect that a significant portion of its unrecognized tax benefits will increase or decrease in the next 12 months as of December 31, 2021.

Under the provisions of the Internal Revenue Code, the Company’s NOL and tax credit carryforwards are subject to review and possible adjustment by the Internal Revenue Service and state tax authorities. NOL and tax credit carryforwards may be subject to an annual limitation in the event of certain cumulative changes in the ownership interest of significant stockholders over a three-year period in excess of 50%, as defined under Sections 382 and 383 of the Internal Revenue Code, respectively, as well as similar state provisions. This could limit the amount of tax attributes that can be utilized annually to offset future taxable income or tax liabilities. The amount of the annual limitation is determined based on the value of the Company immediately prior to the ownership change. Subsequent ownership changes may further affect the limitation in future years. The Company has completed several financings since its inception which may have resulted in a change in control as defined by Sections 382 and 383 of the Internal Revenue Code, or could result in a change in control in the future.

The Company and its subsidiaries file income tax returns in the United States, at the federal level and in various states, and in foreign jurisdictions. The U.S. federal and state income tax returns are generally subject to tax examinations for the tax years ended December 31, 2017 onward. To the extent the Company has tax attribute carryforwards, the tax years in which the attribute was generated may still be adjusted upon examination by the Internal Revenue Service or state tax authorities to the extent utilized in a future period.