Balance Sheet Account Details

12 Months Ended

Dec. 31, 2019

Other Balance Sheet Details [Abstract]

Short-term Investments

The following table summarizes the various investment categories at December 31, 2019 and 2018 (in thousands):


	Cost		Gross unrealized gains		Gross unrealized losses		Estimated fair value
December 31, 2019
Short-term investments
Bank deposits	$	411,690	$	188	$	(3)	$	411,875
Corporate bonds	63,818		161		—		63,979
Corporate equity securities	4,506		416		(1,850)		3,072
Commercial paper	210,525		43		(16)		210,552
Warrants	—		125		—		125
Mutual fund	250,635		—		(249)		250,386
	$	941,174	$	933	$	(2,118)	$	939,989
December 31, 2018
Short-term investments
Bank deposits	$	311,066	$	26	$	(29)	$	311,063
Corporate bonds	53,223		1		(45)		53,179
Corporate equity securities	135		1,191		—		1,326
Commercial paper	225,731		8		(76)		225,663
U.S. Government bonds	7,982		—		(9)		7,973
Municipal bonds	2,017		—		(4)		2,013
	$	600,154	$	1,226	$	(163)	$	601,217

Property and equipment are stated at cost and consists of the following (in thousands):


	December 31,
	2019		2018
Lab and office equipment	$	6,307	$	4,183
Leasehold improvements	2,729		2,418
Computer equipment and software	999		936
	10,035		7,537
Less accumulated depreciation and amortization	(2,850)		(2,165)
	$	7,185	$	5,372

Depreciation of equipment is computed using the straight-line method over the estimated useful lives of the assets which range from three to ten years. Leasehold improvements are amortized using the straight-line method over their estimated useful lives or their related lease term, whichever is shorter. Depreciation expense of $1.5 million, $0.9 million, and $0.4 million was recognized for the twelve months ended ended December 31, 2019, 2018, and 2017, respectively, and was included in operating expenses.

Goodwill and identifiable intangible assets consist of the following (in thousands):


	As of December 31,
	2019		2018
Indefinite lived intangible assets
Goodwill	$	95,229	$	86,646
Definite lived intangible assets
Complete technology	242,813		235,413
Less: Accumulated amortization⁽¹⁾	(50,203)		(35,070)
Trade name	2,642		2,642
Less: Accumulated amortization	(1,180)		(1,048)
Customer relationships	29,600		29,600
Less: Accumulated amortization	(13,224)		(11,744)
Total goodwill and other identifiable intangible assets, net	$	305,677	$	306,439

(1) Accumulated amortization for complete technology includes immaterial amount of foreign currency translation adjustments for the complete technology acquired from the Vernalis acquisition.

Amortization of finite lived intangible assets is computed using the straight-line method over the estimated useful life of the asset of 20 years. Amortization expense of $16.9 million, $15.8 million, and $12.1 million was recognized for the years ended December 31, 2019 and 2018, and 2017, respectively. Estimated amortization expense for the years ending December 31, 2020 through 2024 is $14.1 million per year. For each of the years ended December 31, 2019, 2018, and 2017, there was no material impairment of intangible assets with finite lives.

Accrued liabilities consist of the following (in thousands):


	December 31,
	2019		2018
Compensation	$	1,986	$	4,045
Legal	1,135		942
Amounts owed to former licensees	381		428
Royalties owed to third parties	—		1,025

Payments due to broker for share repurchases	—		4,613
Return reserve	3,027		3,590
Restructuring	—		1,093
Current operating lease liabilities	1,242		—
Other	2,065		3,464
	$	9,836	$	19,200

Contingent liabilities:

In connection with the acquisition of CyDex in January 2011, we issued a series of CVRs and also assumed certain contingent liabilities. We may be required to make additional payments upon achievement of certain clinical and regulatory milestones to the CyDex shareholders and former license holders.

In connection with the acquisition of Metabasis in January 2010, we entered into four CVR agreements with Metabasis shareholders. The CVRs entitle the holders to cash payments as frequently as every six months as proceeds are received by us

upon the sale or licensing of any of the Metabasis drug development programs and upon the achievement of specified milestones.

In connection with the acquisition of Crystal in October 2017, we entered into contingent liabilities based on achievement of certain research and business milestones as well as certain revenue goal. See “Note (4), Business Combinations” for more information.

The following table summarizes rollfoward of contingent liabilities as of December 2019 and 2018 (in thousands):


	December 31, 2017		Payments		Fair Value Adjustment		December 31, 2018		Payments		Fair Value Adjustment		Repurchases		December 31, 2019
Cydex	$	1,589	$	(25)	$	(1,050)	$	514	$	(50)	$	(116)	$	—	$	348
Metabasis	3,971		(3,860)		5,440		5,551		—		904		(520)		5,935
Crystal	8,401		(1,000)		(924)		6,477		(3,000)		(818)		—		2,659
Total	$	13,961	$	(4,885)	$	3,466	$	12,542	$	(3,050)	$	(30)	$	(520)	$	8,942