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Summary of Significant Accounting Policies (Tables)
9 Months Ended
Sep. 30, 2019
Summary of Significant Accounting Policies  
Contract assets and contract liabilities

The following table presents changes in the Company’s contract assets and contract liabilities during the nine months ended September 30, 2019 and 2018 (in thousands):

Balance at

Balance at

Nine months ended September 30, 2019

December 31, 2018

 

Additions

Deductions

End of Period

Contract asset

$

500

$

$

(500)

$

Contract liabilities

$

80,802

$

65,287

$

(237)

$

145,852

Balance at

January 1, 2018

Balance at

Nine months ended September 30, 2018

(ASC 606 adoption)

Additions

Deductions

Impact of Netting

End of Period

Contract asset

$

$

500

$

(5,000)

$

5,000

$

500

Contract liabilities

$

89,967

$

706

$

(13,368)

$

5,000

$

82,305

The Company recognized the following revenues as a result of changes in contract asset and contract liability balances in the respective periods (in thousands):

Three Months Ended

Nine Months Ended

September 30,

September 30,

2019

2018

2019

2018

Revenue recognized in the period from:

Amounts included in contract liabilities at the beginning of the period

$

79

$

172

$

237

$

13,368

Performance obligations satisfied in previous periods

$

$

500

$

5,000

$

500

Schedule of assets that are required to be measured at fair value on a recurring basis

As of September 30, 2019, the Company held certain assets that are required to be measured at fair value on a recurring basis. The following table represents the fair value hierarchy for the Company’s financial assets measured at fair value on a recurring basis as of September 30, 2019 (in thousands):

Fair Value Measurements at September 30, 2019 Using

Quoted Prices in

Significant

Active Markets for

Significant Other

Unobservable

Identical Assets

Observable Inputs

Inputs

    

Total

    

(Level 1)

    

(Level 2)

    

(Level 3)

Cash equivalents

$

187,759

$

187,759

$

$

As of December 31, 2018, the Company held certain assets that are required to be measured at fair value on a recurring basis. The following table represents the fair value hierarchy for the Company’s financial assets measured at fair value on a recurring basis as of December 31, 2018 (in thousands):

Fair Value Measurements at December 31, 2018 Using

Quoted Prices in

Significant

Active Markets for

Significant Other

Unobservable

Identical Assets

Observable Inputs

Inputs

    

Total

    

(Level 1)

    

(Level 2)

    

(Level 3)

Cash equivalents

$

242,604

$

242,604

    

$

    

$

Schedule of common stock equivalents, as calculated in accordance with the treasury-stock method

The Company’s common stock equivalents, as calculated in accordance with the treasury-stock method for the options and unvested restricted stock and the if-converted method for the Convertible Notes, are shown in the following table (in thousands):

Three Months Ended

Nine Months Ended

September 30,

September 30,

    

2019

    

2018

    

2019

    

2018

    

Options outstanding to purchase common stock, shares issuable under the employee stock purchase plan, and unvested restricted stock/units at end of period

18,754

18,153

18,754

18,153

Common stock equivalents under treasury stock method for options, shares issuable under the employee stock purchase plan, and unvested restricted stock

731

 

3,153

926

3,378

 

Shares issuable upon conversion of convertible notes at end of period

501

501

501

501

Common stock equivalents under if-converted method for convertible notes

501

501

501

501

Schedule of risk-free rate of the stock options based on US Treasury rate

Three Months Ended September 30,

Nine Months Ended September 30,

    

2019

2018

2019

2018

Dividend

None

None

None

None

Volatility

81.63%

71.91%

76.28%

70.99%

Risk-free interest rate

1.78%

2.89%

2.24%

2.72%

Expected life (years)

6.0

6.0

6.0

6.0

Summary of stock option activity

A summary of option activity under the Company’s equity plans as of September 30, 2019, and changes during the nine month period then ended is presented below (in thousands, except weighted-average data):

    

    

Weighted-

Number

Average

of Stock

Exercise

Options

Price

Outstanding at December 31, 2018

15,564

$

10.20

Granted

7,340

4.28

Exercised

(86)

2.53

Forfeited/Canceled

(5,712)

9.07

Outstanding at September 30, 2019

17,106

$

8.08

Summary of restricted stock activity

A summary of restricted stock and restricted stock unit activity under the Company’s equity plans as of September 30, 2019 and changes during the nine-month period ended September 30, 2019 is presented below (in thousands):

Number of

Weighted-

Restricted

Average Grant

Stock Shares

Date Fair Value

Unvested at December 31, 2018

 

1,816

$

2.87

Awarded

631

2.55

Vested

 

(504)

2.64

Forfeited

(296)

2.56

Unvested at September 30, 2019

 

1,647

$

2.88

Schedule of percentage of total revenues recognized from each significant customer

Three Months Ended

Nine Months Ended

September 30,

September 30,

Collaborative Partner:

    

2019

2018

2019

2018

Roche

99%

77%

99%

57%

CytomX

-

14%

-

7%

Takeda

-

2%

-

29%