Significant Accounting Policies (Tables)

3 Months Ended

Mar. 31, 2017

Significant Accounting Policies [Abstract]

We compute basic net income (loss) per share by dividing the net income or loss by the weighted-average number of common shares outstanding during the period. For the three months ended March 31, 2017, we had net income. As a result, we computed diluted net income per share using the weighted-average number of common shares and dilutive common equivalent shares outstanding during those periods. Diluted common equivalent shares for the three months ended March 31, 2017, consisted of the following (in thousands except per share amounts):

Three months ended March 31, 2017	Income (Numerator)		Shares (Denominator)		Per-Share Amount

Income available to common shareholders	$	3,468		122,861	$	0.03
Effect of dilutive securities:
Shares issuable upon exercise of stock options		—		1,674
Shares issuable upon restricted stock award issuance		—		377
Shares issuable related to our ESPP		—		60
Income available to common shareholders, plus assumed conversions	$	3,468		124,972	$	0.03

Changes in Accumulated Other Comprehensive Loss

Accumulated other comprehensive loss is primarily comprised of unrealized gains and losses on investments, net of taxes and adjustments we made to reclassify realized gains and losses on investments from other accumulated comprehensive income (loss) to our condensed consolidated statement of operations. The following table summarizes changes in accumulated other comprehensive income (loss) for the three months ended March 31, 2017 and 2016 (in thousands):

	Three Months Ended March 31,
	2017			2016
Beginning balance accumulated other comprehensive loss	$	(30,358	)	$	(13,565	)
Unrealized losses on securities, net of tax (1)		266			(2,550	)
Amounts reclassified from accumulated other comprehensive income (2)		(374	)		—
Currency translation adjustment		6			—
Net current period other comprehensive loss		(102	)		(2,550	)
Ending balance accumulated other comprehensive loss	$	(30,460	)	$	(16,115	)

(1)

There was no tax benefit for other comprehensive loss for the three months ended March 31, 2017 and 2016.

(2)

Amounts are included in investment income on our condensed consolidated statement of operations.

Significant Accounting Policies [Abstract]

Weighted-Average Assumptions - ESPP

ESPP:

	Three Months Ended March 31,
	2017		2016
Risk-free interest rate		0.7%		0.5%
Dividend yield		0.0%		0.0%
Volatility		66.5%		69.4%
Expected life		6 months		6 months

Stock-Based Compensation Expense

The following table summarizes stock-based compensation expense for the three months ended March 31, 2017 and 2016 (in thousands). Our consolidated non-cash stock-based compensation expense includes $3.2 million of stock-based compensation expense for Akcea employees for each of the three months ended March 31, 2017 and 2016.

	Three Months Ended March 31,
	2017			2016
Research, development and patent		$	16,122		$	14,770
Selling, general and administrative			4,790			5,333
Total		$	20,912		$	20,103

Employee Stock Options [Member]

Significant Accounting Policies [Abstract]

Weighted-Average Assumptions

We use the Black-Scholes model to estimate the fair value of stock options granted and stock purchase rights under our ESPP. The expected term of stock options granted represents the period of time that we expect them to be outstanding. We estimate the expected term of options granted based on historical exercise patterns. For the three months ended March 31, 2017 and 2016, we used the following weighted-average assumptions in our Black-Scholes calculations:

Employee Stock Options:

	Three Months Ended March 31,
	2017		2016
Risk-free interest rate		1.8%		1.5%
Dividend yield		0.0%		0.0%
Volatility		66.3%		57.9%
Expected life		4.5 years		4.5 years