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Organization and Significant Accounting Policies (Tables)
12 Months Ended
Dec. 31, 2017
Organization and Significant Accounting Policies [Abstract]  
Basic Net Income per Share
We calculated our basic net income per share for 2017 as follows (in thousands, except per share amounts):

Year Ended December 31, 2017
 
Weighted
Average Shares
Owned in Akcea
  
Akcea’s
Net Loss
Per Share
  
Ionis’
Portion of
Akcea’s Net Loss
 
Common shares
  
20,669
  
$
(2.82
)
 
$
(58,332
)
Preferred shares
  
15,748
   
(1.55
)
  
(24,344
)
Akcea’s net loss attributable to our ownership
         
$
(82,676
)
Ionis’ stand-alone net income
          
92,336
 
Net income available to Ionis common stockholders
         
$
9,661
 
Weighted average shares outstanding
          
124,016
 
Basic net income per share
         
$
0.08
 

Basic and Diluted Net Income Per Share
For 2017, we had net income available to Ionis common stockholders. 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 2017 consisted of the following (in thousands except per share amounts):

Year Ended December 31, 2017
 
Income
(Numerator)
  
Shares
(Denominator)
  
Per-Share
Amount
 
Net income available to Ionis common stockholders
 
$
9,661
   
124,016
  
$
0.08
 
Effect of dilutive securities:
            
Shares issuable upon exercise of stock options
  
   
1,619
     
Shares issuable upon restricted stock award issuance
  
   
459
     
Shares issuable related to our ESPP
  
   
4
     
Income available to Ionis common stockholders, plus assumed conversions
 
$
9,661
   
126,098
  
$
0.08
 

Amortization Expense for Patents
Based on our existing patents, we estimate amortization expense related to patents in each of the next five years to be the following:

Years Ending December 31,
 
Amortization
(in millions)
 
2018
 
$
1.6
 
2019
 
$
1.4
 
2020
 
$
1.3
 
2021
 
$
1.3
 
2022
 
$
1.2
 

Accrued Liabilities
Our accrued liabilities consisted of the following (in thousands):

  
December 31,
 
  
2017
  
2016
 
Clinical expenses
 
$
16,347
  
$
23,428
 
In-licensing expenses
  
33,790
   
6,430
 
Other miscellaneous expenses
  
16,481
   
6,155
 
Total accrued liabilities
 
$
66,618
  
$
36,013
 

Property, Plant and Equipment
We carry our property, plant and equipment at cost and depreciate it on the straight-line method over its estimated useful life, which consists of the following (in thousands):

  
Estimated Useful Lives
  
December 31,
 
  
(in years)
  
2017
  
2016
 
Computer software, laboratory, manufacturing and other equipment
 
3 to 10
  
$
66,558
  
$
63,287
 
Building, building improvements and building systems
 
15 to 40
   
92,770
   
48,909
 
Land improvements
  20   
2,853
   
2,853
 
Leasehold improvements
 
5 to 15
   
26,748
   
41,736
 
Furniture and fixtures
 
5 to 10
   
6,161
   
5,937
 
       
195,090
   
162,722
 
Less accumulated depreciation
      
(87,676
)
  
(80,075
)
       
107,414
   
82,647
 
Land
      
14,493
   
10,198
 
 Total
     
$
121,907
  
$
92,845
 

Changes in Accumulated Other Comprehensive Income (Loss)
Accumulated other comprehensive income (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 Consolidated Statement of Operations. The following table summarizes changes in accumulated other comprehensive income (loss) for the years ended December 31, 2017, 2016 and 2015 (in thousands):
 
  
Years Ended December 31,
 
  
2017
  
2016
  
2015
 
Beginning balance accumulated other comprehensive (loss) income
 
$
(30,358
)
 
$
(13,565
)
 
$
39,747
 
Unrealized losses on securities, net of tax (1)
  
(960
)
  
(17,219
)
  
(33,101
)
Amounts reclassified from accumulated other comprehensive (loss) income (2)
  
(374
)
  
447
   
(20,211
)
Currency translation adjustment
  
(67
)
  
(21
)
  
 
Net other comprehensive loss for the period
  
(1,401
)
  
(16,793
)
  
(53,312
)
Ending balance accumulated other comprehensive loss
 
$
(31,759
)
 
$
(30,358
)
 
$
(13,565
)

(1)
There was no tax expense for other comprehensive loss for the years ended December 31, 2017, 2016 or 2015.

(2)
Amounts for 2015 and 2017 are included in the separate line called “Gain on investment in Regulus Therapeutics Inc.” on our Consolidated Statement of Operations.

Assets Measured at Fair Value on a Recurring Basis
The following tables present the major security types we held at December 31, 2017 and 2016 that are regularly measured and carried at fair value. The tables segregate each security type by the level within the fair value hierarchy of the valuation techniques we utilized to determine the respective securities’ fair value (in thousands):

  
At
December 31, 2017
  
Quoted Prices in
Active Markets
(Level 1)
  
Significant Other
Observable Inputs
(Level 2)
 
Cash equivalents (1)
 
$
86,262
  
$
86,262
  
$
 
Corporate debt securities (2)
  
647,461
   
   
647,461
 
Debt securities issued by U.S. government agencies (3)
  
136,325
   
   
136,325
 
Debt securities issued by the U.S. Treasury (3)
  
30,818
   
30,818
   
 
Debt securities issued by states of the U.S. and political subdivisions of the states (4)
  
93,932
   
   
93,932
 
Total
 
$
994,798
  
$
117,080
  
$
877,718
 

  
At
December 31, 2016
  
Quoted Prices in
Active Markets
(Level 1)
  
Significant Other
Observable Inputs
(Level 2)
 
Cash equivalents (1)
 
$
54,137
  
$
54,137
  
$
 
Corporate debt securities (3)
  
396,221
   
   
396,221
 
Debt securities issued by U.S. government agencies (3)
  
55,179
   
   
55,179
 
Debt securities issued by the U.S. Treasury (3)
  
29,286
   
29,286
   
 
Debt securities issued by states of the U.S. and political subdivisions of the states (5)
  
109,111
   
   
109,111
 
Investment in Regulus Therapeutics Inc.
  
2,414
   
2,414
   
 
Total
 
$
646,348
  
$
85,837
  
$
560,511
 

(1)
Included in cash and cash equivalents on our consolidated balance sheet.

(2)
$11.9 million included in cash and cash equivalents on our consolidated balance sheet, with the difference included in short-term investments on our consolidated balance sheet.

(3)
Included in short-term investments on our consolidated balance sheet.

(4)
$3.5 million included in cash and cash equivalents on our consolidated balance sheet, with the difference included in short-term investments on our consolidated balance sheet.

(5)
$9.3 million included in cash and cash equivalents on our consolidated balance sheet, with the difference included in short-term investments on our consolidated balance sheet.
Reconciliation of Assets Measured at Fair Value on a Recurring Basis Using Significant Unobservable Inputs (Level 3)
The following is a reconciliation of the potential premium we would have received if Akcea had not completed its IPO, measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for 2017 (in thousands):

  
Year Ended
December 31, 2017
 
Beginning balance of Level 3 instruments
 
$
 
Value of the potential premium we will receive from Novartis at inception of the SPA (January 2017)
  
5,035
 
Write-off of premium to other expenses
  
(5,035
)
Ending balance of Level 3 instruments
 
$