View Filing Data

Accumulated Other Comprehensive Income (Tables)

12 Months Ended

Dec. 31, 2019

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Summary of Accumulated Balances Related to Each Component of Other Comprehensive Income (Loss)

The accumulated balances related to each component of other comprehensive income (loss), net of taxes, were as follows for the years ended December 31, 2019 and 2018:



(in thousands)	December 31, 2019		December 31, 2018
Foreign currency translation	$	13	$	7
Unrealized gain (loss) on marketable securities	236		(6		)
Accumulated other comprehensive income	$	249	$	1

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Current assets:
Cash and cash equivalents	$ 45,072	$ 61,005
Marketable securities	267,057	196,355
Accounts receivable, net	26,367	28,780
Inventory	1,140	994
Prepaid expenses and other current assets	14,500	11,998
Total current assets	354,136	299,132
Property and equipment, net	3,864	4,417
Operating lease right-of-use assets	11,180	0
Intangible assets, net	23,037	24,542
Deferred tax assets	87,680	0
Non-current inventory and other	3,851	4,039
Total assets	483,748	332,130
Current liabilities:
Accounts payable and accrued liabilities	27,590	21,584
Product revenue allowances	31,915	31,231
Milestone obligations under license agreements	0	200
Total current liabilities	59,505	53,015
Operating lease non-current liabilities	12,455	0
Other non-current liabilities	843	3,693
Total liabilities	72,803	56,708
Commitments and contingencies (Notes 10 and 17)
Stockholders’ equity:
Preferred stock, $0.001 par value; 20,000,000 shares authorized, and no shares issued or outstanding	0	0
Common stock, $0.001 par value; 150,000,000 shares authorized; 53,549,612 and 52,477,593 shares issued and outstanding at December 31, 2019 and 2018, respectively	54	52
Additional paid-in capital	631,307	611,587
Accumulated other comprehensive income	249	1
Accumulated deficit	(220,665)	(336,218)
Total stockholders’ equity	410,945	275,422
Total liabilities and stockholders’ equity	$ 483,748	$ 332,130

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Statement of Comprehensive Income [Abstract]
Net income (loss)	$ 115,553	$ 25,208	$ (15,567)
Other comprehensive income (loss):
Net foreign currency translation gain (loss)	6	(22)	30
Change in net unrealized gain (loss) on marketable securities	313	57	(122)
Tax provision on other comprehensive income	(71)	0	0
Other comprehensive income (loss), net of tax	248	35	(92)
Comprehensive income (loss)	$ 115,801	$ 25,243	$ (15,659)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References + Details

Property and Equipment - Additional Information (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Property, Plant and Equipment [Abstract]
Depreciation expense	$ 1,387	$ 1,429	$ 1,234

Stock-Based Compensation - RSU - Additional Information (Detail) $ in Millions	12 Months Ended
	Dec. 31, 2019 USD ($) installment shares	Dec. 31, 2018 shares	Dec. 31, 2017 shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of vesting equal installments \| installment	36
Restricted Stock Units (RSU)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of vesting equal installments \| installment	4
Unrecognized compensation expenses related to unvested RSUs \| $	$ 22.8
Unrecognized compensation expenses, weighted average period	1 year 9 months 18 days
Grant date fair value of common stock vested (in shares) \| shares	526,175	528,745	362,313
Grant date fair value of common stock vested \| $	$ 7.7

Business Organization and Presentation

12 Months Ended

Dec. 31, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Business Organization and Presentation

Business organization

Vanda Pharmaceuticals Inc. (the Company) is a leading global biopharmaceutical company focused on the development and commercialization of innovative therapies to address high unmet medical needs and improve the lives of patients. The Company commenced its operations in 2003 and operates in one reporting segment.

The Company's commercial portfolio is currently comprised of two products, HETLIOZ^® for the treatment of Non-24-Hour Sleep-Wake Disorder (Non-24) and Fanapt^® for the treatment of schizophrenia. HETLIOZ^® is the first treatment for Non-24 approved by the U.S. Food and Drug Administration (FDA). In addition, the Company has a number of drugs in development, including:


•	HETLIOZ^® (tasimelteon) for the treatment of jet lag disorder, Smith-Magenis Syndrome (SMS), pediatric Non-24 and delayed sleep phase disorder (DSPD);


•	Fanapt^® (iloperidone) for the treatment of bipolar disorder and a long acting injectable (LAI) formulation program for the treatment of schizophrenia;


•	Tradipitant (VLY-686), a small molecule neurokinin-1 receptor (NK-1R) antagonist, for the treatment of atopic dermatitis, gastroparesis and motion sickness;


•	VTR-297, a small molecule histone deacetylase (HDAC) inhibitor for the treatment of hematologic malignancies and with potential use as a treatment for several oncology indications;


•	VQW-765, a small molecule nicotinic acetylcholine receptor partial agonist, with potential use for the treatment of psychiatric disorders; and


•	Portfolio of Cystic Fibrosis Transmembrane Conductance Regulator (CFTR) activators and inhibitors for the treatment of dry eye and ocular inflammation and for the treatment of secretory diarrhea disorders, including cholera.

Basis of Presentation

The accompanying consolidated financial statements includes the accounts of Vanda Pharmaceuticals Inc. and its wholly-owned subsidiaries and have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S.). All intercompany accounts and transactions have been eliminated in consolidation.

Commitments and Contingencies - Purchase Commitments (Detail) $ in Millions	12 Months Ended
	Dec. 31, 2019 USD ($)
Commitments and Contingencies Disclosure [Abstract]
Agreements for clinical and marketing services, termination notice period	90 days
Purchase commitments
2020	$ 9.2
2021	1.0
2022	$ 0.5

Employee Benefit Plan (Detail) - USD ($) $ in Millions	12 Months Ended
Employee Benefit Plan (Detail) - USD ($) $ in Millions	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Retirement Benefits [Abstract]
Defined contribution plan employer matching percent	50.00%
Defined contribution plan maximum employee contribution percent	6.00%
Defined contribution plan vesting period	4 years
Defined contribution plan matching amount	$ 0.8	$ 0.9	$ 0.8

Intangible Assets

12 Months Ended

Dec. 31, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Assets

HETLIOZ^®. In January 2014, the Company announced that the FDA had approved the New Drug Application (NDA) for HETLIOZ^®. As a result of this approval, the Company met a milestone under its license agreement with Bristol-Myers Squibb (BMS) that required the Company to make a license payment of $8.0 million to BMS. The $8.0 million is being amortized on a straight-line basis over the estimated economic useful life of the related product patents, the latest of which expires in July 2035.

In April 2018, the Company met its final milestone under its license agreement when cumulative worldwide sales of HETLIOZ^® reached $250.0 million. As a result of the achievement of this milestone, the Company made a payment to BMS of $25.0 million in 2018. The $25.0 million, which was capitalized as an intangible asset in the first quarter of 2015, was determined to be additional consideration for the acquisition of the HETLIOZ^® intangible asset and is being amortized on a straight-line basis over the estimated economic useful life of the related product patents, the latest of which expires in July 2035.

The estimated economic useful life of both the $8.0 million and the $25.0 million intangible assets were changed from February 2035 to July 2035 based on the July 2035 expiration date of U.S. patent number 10,376,487 ('487 Patent) issued by the U.S. Patent and Trademark Office in August 2019. The estimated economic useful life of these intangible assets were

previously changed from May 2034 to February 2035 based on the February 2035 expiration date of U.S. patent number 10,071,977 ('977 Patent) issued by the U.S. Patent and Trademark Office in September 2018.

The following is a summary of the Company’s intangible assets as of December 31, 2019:



		December 31, 2019
(in thousands)	Estimated Useful Life (Years)	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
HETLIOZ^®	July 2035	$	33,000	$	9,963	$	23,037

The following is a summary of the Company’s intangible assets as of December 31, 2018:



		December 31, 2018
(in thousands)	Estimated Useful Life (Years)	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
HETLIOZ^®	February 2035	$	33,000	$	8,458	$	24,542

As of December 31, 2019 and 2018, the Company also had $27.9 million of fully amortized intangible assets related to Fanapt^®.

Intangible assets are amortized over their estimated useful economic life using the straight-line method. Amortization expense for the years ended December 31, 2019, 2018 and 2017 was as follows:



	Year Ended December 31,
(in thousands)	2019		2018		2017
HETLIOZ^®	$	1,505	$	1,527	$	1,750

The following is a summary of the future intangible asset amortization schedule as of December 31, 2019:



(in thousands)	Total		2020		2021		2022		2023		2024		Thereafter
HETLIOZ^®	$	23,037	$	1,478	$	1,478	$	1,478	$	1,478	$	1,478	$	15,647

Commitments and Contingencies - Tradipitant - Additional Information (Detail) - Tradipitant - USD ($) $ in Millions	1 Months Ended	12 Months Ended
	Jul. 31, 2018	Dec. 31, 2019
Commitments and Contingencies [Line Items]
Future percentage of royalty payments based net sales		low double digits
Development and milestone payments to third party	$ 2.0	$ 3.0
Pre-NDA Approval Milestones
Commitments and Contingencies [Line Items]
Milestone obligation under license agreement		2.0
Sales Milestone
Commitments and Contingencies [Line Items]
Possible future milestone payment		80.0
UNITED STATES \| Regulatory Approval Milestone
Commitments and Contingencies [Line Items]
Possible future milestone payment		10.0
Europe \| Regulatory Approval Milestone
Commitments and Contingencies [Line Items]
Possible future milestone payment		$ 5.0

Income Taxes - Valuation Allowance Activity on Deferred Tax Assets (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Income Tax Disclosure [Abstract]
Balance at Beginning of Year	$ 111,950	$ 116,110	$ 146,012
Additions	0	4,036	12,403
Reductions	(103,795)	(8,196)	(42,305)
Balance at End of Year	$ 8,155	$ 111,950	$ 116,110

Income Taxes - Summary of Provision (Benefit) for Income Taxes (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Current:
Federal	$ 0	$ 0	$ 0
State	1,161	53	65
Foreign	81	99	(66)
Deferred:
Federal	(85,624)	0	0
State	(2,127)	0	0
Foreign	(16)	(14)	137
Provision for income taxes	$ (86,525)	$ 138	$ 136

Leases - Additional Information (Details) $ in Millions	12 Months Ended
Leases - Additional Information (Details) $ in Millions	Dec. 31, 2019 USD ($) ft²	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Operating lease cost	$ 2.3
Short-term lease cost	0.4
Non-lease component expense	1.4
Rent expense		$ 3.6	$ 3.2
Operating lease, payments	$ 2.5
Washington DC Leases and Sublease
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Leased square footage \| ft²	33,534
Renewal term of lease agreement	5 years
London Lease
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Leased square footage \| ft²	2,880
Renewal term of lease agreement	5 years
Sublease \| Washington DC Leases and Sublease
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Leased square footage \| ft²	9,928

Accumulated Other Comprehensive Income - Summary of Accumulated Balances Related to Each Component of Other Comprehensive Income (Loss) (Detail) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]
Foreign currency translation	$ 13	$ 7
Unrealized gain (loss) on marketable securities	236	(6)
Accumulated other comprehensive income	$ 249	$ 1

Legal Matters	12 Months Ended
Legal Matters	Dec. 31, 2019
Commitments and Contingencies Disclosure [Abstract]
Legal Matters	Legal Matters Fanapt^®. The Company has been involved in litigation with Roxane Laboratories, Inc. (Roxane) and its affiliates, West-Ward Pharmaceuticals International Limited and West-Ward Pharmaceuticals Corp (West-Ward), since the Company filed a lawsuit against Roxane in the U.S. District Court for the District of Delaware (Delaware District Court) for patent infringement in June 2014. The lawsuit was filed in response to Roxane’s submission to the U.S. Food and Drug Administration (FDA) of an Abbreviated New Drug Application (ANDA) for a generic version of Fanapt^® prior to the expiration of certain of the Company’s patents covering Fanapt^®, including U.S. Patent No. 8,586,610 (‘610 Patent). In August 2016, the Delaware District Court ruled in the Company’s favor, permanently enjoining Roxane from manufacturing, using, selling, offering to sell, distributing or importing any generic iloperidone product described in Roxane’s ANDA until the expiration of the ‘610 Patent in November 2027, or May 2028 if the Company obtains pediatric exclusivity. In April 2018, following an appeal by Roxane of the Delaware District Court’s decision to the Federal Circuit Court of Appeals (Federal Circuit), the Federal Circuit affirmed the Delaware District Court’s ruling. In June 2018, West-Ward, having replaced Roxane as defendants following the acquisition of Roxane by West-Ward’s parent company, Hikma Pharmaceuticals PLC, petitioned the Federal Circuit for a rehearing en banc. In August 2018, the Federal Circuit denied West-Ward's petition. In January 2019, West-Ward filed a petition in the U.S. Supreme Court for a writ of certiorari seeking reversal of the Federal Circuit’s decision. In March 2019, the U.S. Supreme Court invited the Solicitor General of the U.S. to file a brief in the matter expressing the views of the U.S. In January 2020, the U.S. Supreme Court denied West-Ward's petition for writ of certiorari. In 2015, the Company filed six separate patent infringement lawsuits in the Delaware District Court against Roxane, Inventia Healthcare Pvt. Ltd. (Inventia), Lupin Ltd. and Lupin Pharmaceuticals, Inc. (Lupin), Taro Pharmaceuticals USA, Inc. and Taro Pharmaceutical Industries, Ltd. (Taro), and Apotex Inc. and Apotex Corp. (Apotex, and collectively with Roxane, Inventia, Lupin and Taro, the Fanapt^® Defendants). These lawsuits were filed in response to the submission to the FDA by each of the Fanapt^®Defendants of ANDAs for generic versions of Fanapt^® prior to the expiration of the ‘610 Patent in November 2027 or the U.S. Patent No. 9,138,432 in September 2025. The Company entered into separate confidential stipulations with each of Inventia and Lupin regarding any potential launch of their generic versions of Fanapt^®. The parties are scheduled to provide the court with a status report in March 2020 with respect to the remaining lawsuits against the other Fanapt^®Defendants. HETLIOZ^®. In April and May 2018, the Company filed three separate patent infringement lawsuits in the Delaware District Court against Teva Pharmaceuticals USA, Inc. (Teva), MSN Pharmaceuticals Inc. and MSN Laboratories Private Limited (MSN) and Apotex (collectively with Teva and MSN, the HETLIOZ^® Defendants) after having received Paragraph IV certification notice letters (Paragraph IV Letters) from each of the HETLIOZ^® Defendants alleging that certain of the Company's patents covering HETLIOZ^® (collectively, the HETLIOZ^® Patents) were invalid, unenforceable and/or would not be infringed by the manufacture, use or sale of their generic versions of HETLIOZ^®, as described in the ANDAs submitted to the FDA by each of the HETLIOZ^® Defendants, prior to the expiration of the latest to expire of the HETLIOZ^® Patents in 2034. Each of the HETLIOZ^® Patents are listed in the Approved Drug Products with Therapeutic Equivalence Evaluations (Orange Book). In December 2018, the Company filed amended complaints against each of the HETLIOZ^® Defendants following the receipt of additional Paragraph IV Letters from Teva and Apotex concerning its Orange Book listed '977 Patent, which expires in 2035. These lawsuits are scheduled for trial in October 2020. In March 2019, April 2019, and May 2019, the Company filed three additional patent infringement lawsuits in the Delaware District Court against the HETLIOZ^® Defendants following the receipt of additional Paragraph IV Letters from each concerning its Orange Book listed U.S. Patent No. 10,149,829, which expires in 2033. These lawsuits have been consolidated with the other lawsuits against the HETLIOZ^® Defendants and are also scheduled for trial in October 2020. In November and December 2019, the Company filed additional patent infringement lawsuits in the Delaware District Court against Apotex and Teva, respectively, for infringement of its Orange Book listed U.S. Patent No. 10,376,487 ('487 Patent) following the receipt of additional Paragraph IV Letters from Apotex and Teva regarding the '487 Patent, which expires in July 2035. Teva asserted a counterclaim for a declaratory judgment that the ‘487 Patent is invalid. The Company answered Teva’s counterclaim by denying their allegation that the ‘487 Patent is invalid. In January 2020, the Company filed two additional patent infringement lawsuits in the Delaware District Court against Teva and Apotex for infringement of its Orange Book-listed U.S. Patent No. 10,449,176 (‘176 Patent) following the receipt of additional Paragraph IV Letters from Teva and Apotex regarding the ‘176 Patent, which expires in January 2033. A trial date has not yet been scheduled for these lawsuits. In January 2020, the Company received an additional Paragraph IV Letter from MSN concerning the '487 patent, in which MSN alleges that the ‘487 Patent is invalid, unenforceable and/or will not be infringed by the commercial manufacture, use, sale offer for sale, or importation of MSN's generic version of HETLIOZ^® as described in MSN's ANDA. The Company intends to vigorously pursue a patent infringement lawsuit permanently enjoining MSN from infringing the claims of the ‘487 Patent. Other Matters. In April 2018, the Company submitted a protocol amendment to the FDA, proposing a 52-week open-label extension (OLE) period for patients who had completed the tradipitant Phase II clinical study (2301) in gastroparesis. In May 2018, based on feedback from the FDA, the Company amended the protocol limiting the duration of treatment in the 2301 study to a total of three months, while continuing to seek further dialogue with the FDA on extending the study duration to 52-weeks. As a part of this negotiation process, in September 2018, the Company submitted a new follow-on 52-week OLE protocol to the FDA (2302) for patients who had completed the 2301 study. While waiting for further feedback, the Company did not enroll any patients in any study beyond 12 weeks. In December 2018, the FDA imposed a partial clinical hold (PCH) on the two proposed studies, stating that the Company is required first to conduct additional chronic toxicity studies in canines, monkeys or minipigs before allowing patients access in any clinical protocol beyond 12 weeks. At that time, the FDA informed the Company that the original PCH was not based on any safety or efficacy data related to tradipitant, but, rather. that these additional toxicity studies were required by a guidance document. Subsequently, the FDA has taken the position that an additional study was required in order for the FDA to have adequate toxicology data to undertake a risk analysis of tradipitant. On February 5, 2019, the Company filed a lawsuit against the FDA in the U.S. District Court for the District of Columbia (DC District Court), challenging the FDA’s legal authority to issue the PCH, and seeking an order to set it aside. In February 2019, the FDA filed a Motion for Voluntary Remand to the Agency and for a Stay of the Case. In March 2019, the DC District Court granted the FDA’s request for voluntary remand and returned the matter to the FDA for further consideration. In April 2019, the FDA provided its remand response, in which it indicated that, upon review of scientific literature and tradipitant data, it believes that a PCH continues to be appropriate until the Company has adequate safety data from a nine-month non-rodent toxicity study. In May 2019, the Company filed an amended complaint, and in July 2019, the Company filed a Motion for Summary Judgment based on its continuing belief after review of the FDA’s remand response that additional chronic toxicity studies are unjustified, and that it has provided the FDA with sufficient information regarding the safety of tradipitant to justify the continued study of tradipitant in patients beyond 12 weeks, in accordance with applicable law and FDA regulations. The FDA filed a reply and cross-motion for summary judgment in October 2019 and an oral hearing was held on December 13, 2019. On January 31, 2020, the Court granted the FDA's cross-motion for summary judgment and granted judgment in favor of the FDA on the Company's claims. The Company is evaluating its options, including a potential appeal, and the Company intends to continue vigorously pursuing its interests in the matter. In February 2019, a qui tam action filed against the Company was unsealed by order of the DC District Court. The qui tam action, which was filed under seal in March 2017, was brought by a former Company employee on behalf of the U.S., 28 states and the District of Columbia (collectively, the Plaintiff States) and the policyholders of certain insurance companies under the Federal False Claims Act and state law equivalents to the Federal False Claims Act and related state laws. The complaint alleged that the Company violated these laws through the promotion and marketing of its products Fanapt^® and HETLIOZ^® and sought, among other things, treble damages, civil penalties for each alleged false claim, and attorneys’ fees and costs. By virtue of the DC District Court having unsealed the original complaint, the Company learned that in January 2019, the U.S. Department of Justice (the DOJ), as well as the Plaintiff States, elected not to intervene in the qui tam action at that time. In May 2019, the plaintiff filed an amended complaint under seal repeating the same allegations and seeking the same relief. According to a filing unsealed in June 2019, the DOJ reaffirmed its decision not to intervene and incorporated its prior filing, indicating that neither the DOJ nor the Plaintiff States were intervening regarding the original complaint. Although the DOJ and the Plaintiff States have elected not to intervene, the plaintiff may litigate this action and the DOJ and the Plaintiff States may later seek to intervene in the action. In August 2019, the Company filed a motion to dismiss, and in October 2019 the plaintiff filed a reply. The Company intends to vigorously defend itself in the case. The Court will hear the Company's motion to dismiss on March 20, 2020. In February 2019, a securities class action, Gordon v. Vanda Pharmaceuticals Inc., was filed in the U.S. District Court for the Eastern District of New York naming the Company and certain of its officers as defendants. An amended complaint was filed in July 2019. The amended complaint, filed on behalf of a purported stockholder, asserts claims on behalf of a putative class of all persons who purchased the Company’s publicly traded securities between November 4, 2015 and February 11, 2019, for alleged violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as amended, and Rule 10b-5 promulgated thereunder. The amended complaint alleges that the defendants made false and misleading statements and/or omissions regarding Fanapt^®, HETLIOZ^®and the Company’s interactions with the FDA regarding tradipitant between November 3, 2015 and February 11, 2019. The Company believes that it has meritorious defenses and intends to vigorously defend this lawsuit. The Company does not anticipate that this litigation will have a material adverse effect on its business, results of operations or financial condition. However, this lawsuit is subject to inherent uncertainties, the actual cost may be significant, and the Company may not prevail. The Company believes it is entitled to coverage under its relevant insurance policies, subject to a retention, but coverage could be denied or prove to be insufficient. In July 2019, a shareholder derivative complaint, Samuel Williams vs. Mihael Polymeropoulos, et al., was filed in the U.S. District Court for the Eastern District of New York naming certain current and former Company directors and officers as defendants. In September 2019, a shareholder derivative complaint, Michael Bavaro v. Mihael Polymeropoulos, et al., was filed in the Delaware District Court naming certain current and former Company directors and officers as defendants. In October 2019, the Company filed a motion to transfer the Bavaro case to the Eastern District of New York, where the Gordon and Williams cases are pending. In February 2020, the Delaware District Court issued an order staying the Bavaro case pending the resolution of the Williams case. These complaints, filed on behalf of purported stockholders, derivatively on behalf of the Company, assert claims for alleged breach of fiduciary duties by certain of the Company’s current and former directors and officers. The Company believes that it has meritorious defenses and intends to vigorously defend these lawsuits. The Company does not anticipate that this litigation will have a material adverse effect on its business, results of operations or financial condition. However, these lawsuits are subject to inherent uncertainties, the actual cost may be significant, and the Company may not prevail. The Company believes it is entitled to coverage under its relevant insurance policies, subject to a retention, but coverage could be denied or prove to be insufficient. In July 2017, the CHMP issued a negative opinion recommending against approval of Fanaptum^® (oral iloperidone tablets) for the treatment of schizophrenia in adult patients in the E.U. The CHMP was of the opinion that the benefits of Fanaptum^® did not outweigh its risks and recommended against marketing authorization. In March 2018, the Company filed an application seeking annulment of the EMA’s negative opinion and the subsequent European Commission decision refusing marketing authorization of Fanaptum in the European General Court. In December 2019, the General Court issued its judgment dismissing the action, leaving the EMA opinion and Commission decision intact. The Company is considering its options to appeal the decision.

Summary of Significant Accounting Policies - Schedule of Major Customers that Represented More Than 10% of Total Revenues (Detail) - Customer Concentration Risk - Sales Revenue, Net	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Distributor A
Revenue, Major Customer [Line Items]
Concentration risk, percentage	38.00%	37.00%	32.00%
Distributor B
Revenue, Major Customer [Line Items]
Concentration risk, percentage	23.00%	17.00%	10.00%
Distributor C
Revenue, Major Customer [Line Items]
Concentration risk, percentage	12.00%	14.00%	15.00%
Distributor D
Revenue, Major Customer [Line Items]
Concentration risk, percentage	12.00%	12.00%	15.00%
Distributor E
Revenue, Major Customer [Line Items]
Concentration risk, percentage	11.00%	12.00%	12.00%
Distributor F
Revenue, Major Customer [Line Items]
Concentration risk, percentage	0.00%	5.00%	11.00%

Commitments and Contingencies - CFTR Activators and Inhibitors - Additional Information (Detail) - CFTR Activators and Inhibitors - USD ($) $ in Thousands	1 Months Ended	12 Months Ended
	Mar. 31, 2019	Dec. 31, 2019	Dec. 31, 2017
CFTR activators and inhibitors
Tiered royalties payable on future net sales		single-digit
Development and milestone payments to third party		$ 1,200
Regulatory Approval Milestone
CFTR activators and inhibitors
Possible future milestone payments		12,200
Future Regulatory Approval And Sales Milestones
CFTR activators and inhibitors
Possible future milestone payments		33,000
Development And Milestone Payment, Conclusion Of Phase I Study
CFTR activators and inhibitors
Possible future milestone payments		350
Development and milestone payments to third party	$ 200		$ 1,000
Maximum \| Development And Milestone Payment, Conclusion Of Phase I Study
CFTR activators and inhibitors
Possible future milestone payments		$ 1,100

Earnings per Share

12 Months Ended

Dec. 31, 2019

Earnings Per Share [Abstract]

Earnings per Share

Basic earnings per share (EPS) is calculated by dividing the net income (loss) by the weighted average number of shares of common stock outstanding. Diluted EPS is computed by dividing the net income (loss) by the weighted average number of shares of common stock outstanding, plus potential outstanding common stock for the period. Potential outstanding common stock includes stock options and shares underlying RSUs, but only to the extent that their inclusion is dilutive.

The following table presents the calculation of basic and diluted net income (loss) per share of common stock for the years ended December 31, 2019, 2018 and 2017:



	Year Ended December 31,
(in thousands, except for share and per share amounts)	2019		2018		2017
Numerator:
Net income (loss)	$	115,553	$	25,208	$	(15,567	)
Denominator:
Weighted average shares outstanding, basic	53,137,562		50,859,947		44,735,146
Effect of dilutive securities	1,709,498		2,185,310		—
Weighted average shares outstanding, diluted	54,847,060		53,045,257		44,735,146
Net income (loss) per share, basic and diluted:
Basic	$	2.17	$	0.50	$	(0.35	)
Diluted	$	2.11	$	0.48	$	(0.35	)
Antidilutive securities excluded from calculations of diluted net income (loss) per share	1,932,024		903,265		3,136,515

The Company incurred a net loss for the year ended December 31, 2017 causing inclusion of any potentially dilutive securities to have an anti-dilutive effect, resulting in dilutive loss per share and basic loss per share attributable to common stockholders being equivalent.

Inventory (Detail) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Current assets
Work-in-process	$ 0	$ 48
Finished goods	1,140	946
Total inventory, current	1,140	994
Non-Current assets
Raw materials	659	86
Work-in-process	1,109	2,290
Finished goods	1,056	516
Total inventory, non-current	$ 2,824	$ 2,892

Leases - Maturities (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Leases [Abstract]
2020	$ 2,326
2021	2,332
2022	2,355
2023	2,420
2024	2,488
Thereafter	8,182
Total minimum lease payments	20,103
Less: amount of lease payments representing interest	(5,501)
Present value of future minimum lease payments	14,602
Less: current obligations under leases	(2,147)	$ 0
Operating lease non-current liabilities	$ 12,455	$ 0

Leases - Maturities under ASC 840 (Details) $ in Thousands	Dec. 31, 2018 USD ($)
Leases [Abstract]
Total	$ 22,757
2019	2,483
2020	2,495
2021	2,335
2022	2,355
2023	2,420
Thereafter	$ 10,669

Summary of Significant Accounting Policies - Summary of Product Return Allowance (Detail) - Reserve for Product Returns - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
SEC Schedule, 12-09, Valuation and Qualifying Accounts Disclosure [Line Items]
Beginning balance	$ 5,187	$ 4,119	$ 3,080
Additions	3,138	2,684	5,978
Credits/payments	(2,205)	(1,616)	(4,939)
Ending balance	$ 6,120	$ 5,187	$ 4,119

Accounts Payable and Accrued Liabilities (Detail) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Payables and Accruals [Abstract]
Compensation and employee benefits	$ 6,597	$ 6,363
Royalties payable	5,904	5,172
Research and development expenses	5,893	5,593
Consulting and other professional fees	5,376	2,924
Operating lease liabilities	2,147	0
Other	1,673	1,532
Total accounts payable and accrued liabilities	$ 27,590	$ 21,584

Stock-Based Compensation - Stock Option - Additional Information (Detail) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2019 USD ($) installment $ / shares	Dec. 31, 2018 USD ($) $ / shares	Dec. 31, 2017 USD ($) $ / shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share based compensation option awards contractual term	10 years
Vesting period for subsequent stock options granted to directors	4 years
Portion of initial stock options granted to employees that vests on employee's first anniversary	25.00%
Portion of initial stock options granted to employees that vests ratably over three years after completion of first year of service	75.00%
Number of vesting equal installments \| installment	36
Options granted, weighted average fair value per share (in dollars per share) \| $ / shares	$ 10.19	$ 10.66	$ 7.81
Proceeds from exercise of employee stock options	$ 6,264	$ 6,256	$ 5,251
Service option awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation expenses	$ 9,800
Unrecognized compensation expenses, weighted average period	1 year 4 months 24 days

Public Offering of Common Stock	12 Months Ended
Public Offering of Common Stock	Dec. 31, 2019
Equity [Abstract]
Public Offering of Common Stock	Public Offering of Common Stock In March 2018, the Company completed a public offering of 6,325,000 shares of its common stock, including the exercise of the underwriters’ option to purchase an additional 825,000 shares of common stock, at a price to the public of $17.00 per share. Net cash proceeds from the public offering were $100.9 million, after deducting the underwriting discounts and commissions and offering expenses.

Income Taxes - Reconciliation Between Statutory Tax Rate and Effective Tax Rate (Detail) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Valuation Allowance [Line Items]
Federal tax at statutory rate	21.00%	21.00%	35.00%
State taxes	1.80%	1.70%	1.70%
U.S. Tax Cuts and Job Act	0.00%	0.00%	(262.60%)
Change in valuation allowance - U.S. Tax Cuts and Jobs Act	0.00%	0.00%	262.60%
Other change in valuation allowance	(357.60%)	(16.40%)	(47.80%)
Research and development credit	(10.90%)	(9.10%)	9.00%
Orphan drug credit	17.10%	(2.70%)	6.30%
Section 162(m) limitation	2.70%	3.10%	8.10%
Other tax rate changes	(0.50%)	(0.70%)	(2.60%)
Other changes in state deferred taxes	0.00%	5.90%	5.10%
Uncertain tax positions	26.30%	0.00%	0.00%
Stock-based compensation	(1.00%)	(3.90%)	(13.00%)
Other items	3.00%	1.60%	(2.70%)
Effective tax rate	(298.10%)	0.50%	(0.90%)
Income Before Income Taxes, Current Year
Valuation Allowance [Line Items]
Reduction in valuation allowances	$ 7.5
Income Tax Credit Carryforwards and Uncertain Tax Positions
Valuation Allowance [Line Items]
Reduction in valuation allowances	10.7
Estimated Realizability of Deferred Tax Asset
Valuation Allowance [Line Items]
Reduction in valuation allowances	$ 85.6

Marketable Securities - Available-For-Sale Marketable Securities (Detail) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Noncurrent investments
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	$ 266,750
Gross Unrealized Gains	313
Gross Unrealized Losses	(6)
Fair Market Value	267,057
Noncurrent investments \| U.S. Treasury and government agencies
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	88,535
Gross Unrealized Gains	68
Gross Unrealized Losses	(2)
Fair Market Value	88,601
Noncurrent investments \| Corporate debt
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	129,860
Gross Unrealized Gains	196
Gross Unrealized Losses	(1)
Fair Market Value	130,055
Noncurrent investments \| Asset-backed securities
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	48,355
Gross Unrealized Gains	49
Gross Unrealized Losses	(3)
Fair Market Value	$ 48,401
Current investments
Debt Securities, Available-for-sale [Line Items]
Amortized Cost		$ 196,361
Gross Unrealized Gains		50
Gross Unrealized Losses		(56)
Fair Market Value		196,355
Current investments \| U.S. Treasury and government agencies
Debt Securities, Available-for-sale [Line Items]
Amortized Cost		69,275
Gross Unrealized Gains		12
Gross Unrealized Losses		(17)
Fair Market Value		69,270
Current investments \| Corporate debt
Debt Securities, Available-for-sale [Line Items]
Amortized Cost		105,897
Gross Unrealized Gains		38
Gross Unrealized Losses		(25)
Fair Market Value		105,910
Current investments \| Asset-backed securities
Debt Securities, Available-for-sale [Line Items]
Amortized Cost		21,189
Gross Unrealized Gains		0
Gross Unrealized Losses		(14)
Fair Market Value		$ 21,175

Earnings per Share (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Numerator:
Net income (loss)	$ 4,216	$ 100,423	$ 11,526	$ (612)	$ 10,360	$ 7,171	$ 4,611	$ 3,066	$ 115,553	$ 25,208	$ (15,567)
Denominator:
Weighted average shares outstanding, basic (shares)									53,137,562	50,859,947	44,735,146
Effect of dilutive securities (in shares)									1,709,498	2,185,310	0
Weighted average shares outstanding, diluted (in shares)									54,847,060	53,045,257	44,735,146
Net income (loss) per share, basic and diluted:
Basic (in dollars per share)	$ 0.08	$ 1.88	$ 0.22	$ (0.01)	$ 0.20	$ 0.14	$ 0.09	$ 0.07	$ 2.17	$ 0.50	$ (0.35)
Diluted (in dollars per share)	$ 0.08	$ 1.84	$ 0.21	$ (0.01)	$ 0.19	$ 0.13	$ 0.09	$ 0.06	$ 2.11	$ 0.48	$ (0.35)
Antidilutive securities excluded from calculations of diluted net income (loss) per share (shares)									1,932,024	903,265	3,136,515

Property and Equipment

12 Months Ended

Dec. 31, 2019

Property, Plant and Equipment [Abstract]

Property and Equipment

The following is a summary of the Company’s property and equipment, at cost, as of December 31, 2019 and 2018:



(in thousands)	Estimated Useful Life (Years)	December 31, 2019			December 31, 2018
Computer and other equipment	3	$	4,398		$	3,642
Furniture and fixtures	5 - 7	1,491			1,488
Leasehold improvements	5 - 11	4,587			4,506
Total property and equipment, gross		10,476			9,636
Accumulated depreciation and amortization		(6,612		)	(5,219		)
Total property and equipment, net		$	3,864		$	4,417

Depreciation expense was $1.4 million, $1.4 million and $1.2 million for the years ended December 31, 2019, 2018 and 2017, respectively.

Quarterly Financial Data (Unaudited) (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Quarterly Financial Information Disclosure [Abstract]
Revenues	$ 60,930	$ 59,485	$ 59,060	$ 47,713	$ 53,041	$ 49,135	$ 47,350	$ 43,592	$ 227,188	$ 193,118	$ 165,083
Gross profit	54,335	52,327	52,313	42,220	46,994	43,670	41,739	38,680
Income (loss) from operations	4,243	10,759	9,895	(2,087)	9,150	6,233	3,913	2,442	22,810	21,738	(16,903)
Net income (loss)	$ 4,216	$ 100,423	$ 11,526	$ (612)	$ 10,360	$ 7,171	$ 4,611	$ 3,066	$ 115,553	$ 25,208	$ (15,567)
Net income (loss) per share, basic (in dollars per share)	$ 0.08	$ 1.88	$ 0.22	$ (0.01)	$ 0.20	$ 0.14	$ 0.09	$ 0.07	$ 2.17	$ 0.50	$ (0.35)
Net income (loss) per share, diluted (in dollars per share)	$ 0.08	$ 1.84	$ 0.21	$ (0.01)	$ 0.19	$ 0.13	$ 0.09	$ 0.06	$ 2.11	$ 0.48	$ (0.35)

- Definition

The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 944
-SubTopic 220
-Section S99
-Paragraph 1
-Subparagraph (SX 210.7-04(19))
-URI http://asc.fasb.org/extlink&oid=114873790&loc=SL114874131-224263

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 260
-SubTopic 10
-Section 45
-Paragraph 7
-URI http://asc.fasb.org/extlink&oid=109260490&loc=d3e1337-109256

Reference 3: http://www.xbrl.org/2003/role/exampleRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 260
-SubTopic 10
-Section 55
-Paragraph 52
-URI http://asc.fasb.org/extlink&oid=109256448&loc=d3e4984-109258

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 220
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SX 210.5-03(21))
-URI http://asc.fasb.org/extlink&oid=115205541&loc=SL114868664-224227

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 11
-URI http://asc.fasb.org/extlink&oid=109234566&loc=d3e22694-107794

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 260
-SubTopic 10
-Section 50
-Paragraph 1
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=6371337&loc=d3e3550-109257

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 260
-SubTopic 10
-Section 45
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=109260490&loc=d3e1252-109256

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 220
-Section S99
-Paragraph 1
-Subparagraph (SX 210.9-04(23))
-URI http://asc.fasb.org/extlink&oid=114873765&loc=SL114874048-224260

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 260
-SubTopic 10
-Section 45
-Paragraph 60B
-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=109260490&loc=SL5780133-109256

+ Details

- Definition

The amount of net income (loss) for the period available to each share of common stock or common unit outstanding during the reporting period and to each share or unit that would have been outstanding assuming the issuance of common shares or units for all dilutive potential common shares or units outstanding during the reporting period.

+ References

Reference 1: http://www.xbrl.org/2003/role/exampleRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 260
-SubTopic 10
-Section 55
-Paragraph 52
-URI http://asc.fasb.org/extlink&oid=109256448&loc=d3e4984-109258

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 260
-SubTopic 10
-Section 45
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=109260490&loc=d3e1252-109256

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 260
-SubTopic 10
-Section 50
-Paragraph 1
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=6371337&loc=d3e3550-109257

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 220
-Section S99
-Paragraph 1
-Subparagraph (SX 210.9-04(23))
-URI http://asc.fasb.org/extlink&oid=114873765&loc=SL114874048-224260

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 11
-URI http://asc.fasb.org/extlink&oid=109234566&loc=d3e22694-107794

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 260
-SubTopic 10
-Section 45
-Paragraph 7
-URI http://asc.fasb.org/extlink&oid=109260490&loc=d3e1337-109256

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 220
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SX 210.5-03(21))
-URI http://asc.fasb.org/extlink&oid=115205541&loc=SL114868664-224227

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 260
-SubTopic 10
-Section 45
-Paragraph 60B
-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=109260490&loc=SL5780133-109256

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 944
-SubTopic 220
-Section S99
-Paragraph 1
-Subparagraph (SX 210.7-04(19))
-URI http://asc.fasb.org/extlink&oid=114873790&loc=SL114874131-224263

+ Details

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References + Details

Income Taxes - Summary of Domestic and Foreign Components of Income (loss) Before Income Taxes (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Income Tax Disclosure [Abstract]
Domestic	$ 28,794	$ 25,123	$ (15,693)
Foreign	234	223	262
Income (loss) before income taxes	$ 29,028	$ 25,346	$ (15,431)

Employee Benefit Plan	12 Months Ended
Employee Benefit Plan	Dec. 31, 2019
Retirement Benefits [Abstract]
Employee Benefit Plan	Employee Benefit Plan The Company has a defined contribution plan under IRC Section 401(k). This plan covers substantially all employees who meet minimum age and service requirements and allows participants to defer a portion of their annual compensation on a pre-tax basis. Currently, the Company matches fifty percent up to the first six percent of employee contributions. All matching contributions have been paid by the Company. The Company match vests over a 4-year period and amounted to $0.8 million, $0.9 million and $0.8 million for the years ended December 31, 2019, 2018 and 2017, respectively.

Leases

12 Months Ended

Dec. 31, 2019

Leases [Abstract]

Leases

The Company's long-term leases primarily include operating leases and subleases for office space in Washington, D.C. and London, England. The Company recognized ROU assets and lease liabilities related to fixed payments for these long-term operating leases in its Consolidated Balance Sheet as of December 31, 2019. The Company also has short-term leases, including office space in Berlin, Germany.

In June 2011, the Company entered into an operating lease agreement under which it leases 33,534 square feet of office space for its headquarters at 2200 Pennsylvania Avenue, N.W. in Washington, D.C. Subject to the prior rights of other tenants, the Company has the right to renew the lease for five years following its expiration in July 2028. As of December 31, 2019, the renewal period has not been included in the lease term. The Company has the right to sublease or assign all or a portion of the premises, subject to standard conditions. The lease may be terminated early by the Company or the landlord under certain circumstances.

In June 2016, the Company entered into a sublease agreement under which it subleases an additional 9,928 square feet of office space for its headquarters at 2200 Pennsylvania Avenue, N.W. in Washington, D.C. The sublease term began in January 2017 and ends in July 2026, but may be terminated earlier by either party under certain circumstances. The Company has the right to sublease or assign all or a portion of the premises, subject to standard conditions.

In May 2016, the Company entered into an operating lease agreement under which it leases 2,880 square feet of office space in London, England. The Company has the right to renew the lease for five years following its expiration in 2021. As of December 31, 2019, the renewal period has not been included in the lease term.

The following is a summary of the Company’s ROU assets and operating lease liabilities as of December 31, 2019:



(in thousands)	Classification on the Balance Sheet	December 31, 2019
Assets
Operating lease assets	Operating lease right-of-use assets	$	11,180

Liabilities
Operating lease current liabilities	Accounts payable and accrued liabilities	$	2,147
Operating lease non-current liabilities	Operating lease non-current liabilities	12,455
Total lease liabilities		$	14,602

Weighted average remaining lease term		8.1
Weighted average discount rate⁽¹⁾		8.1		%


(1)	Upon adoption of the new lease standard, discount rates used for existing leases were established at January 1, 2019.

For the year ended December 31, 2019, the Company recognized operating lease cost of $2.3 million and short-term operating lease cost of $0.4 million. The Company also recognized $1.4 million of expense related to non-lease elements, such as building maintenance services and utilities, and executory costs associated with the operating leases. For existing leases as of January 1, 2019, executory costs are excluded from operating lease expense, which is consistent with the Company's accounting under ASC 840. For all leases entered into after January 1, 2019, executory costs are allocated between lease and non-lease elements based upon their relative stand-alone prices. For the years ended December 31, 2018 and 2017, the Company recognized $3.6 million and $3.2 million of rent expense, respectively, inclusive of lease expense, non-lease elements, and executory costs for short and long-term operating leases.

Cash paid for amounts included in the measurement of operating lease liabilities is included in operating cash flows and was $2.5 million for the year ended December 31, 2019.

The table below reconciles the Company's future cash obligations to operating lease liabilities recorded on the balance sheet as of December 31, 2019:



(in thousands)	Operating Leases
2020	$	2,326
2021	2,332
2022	2,355
2023	2,420
2024	2,488
Thereafter	8,182
Total minimum lease payments	20,103
Less: amount of lease payments representing interest	(5,501		)
Present value of future minimum lease payments	14,602
Less: current obligations under leases	(2,147		)
Operating lease non-current liabilities	$	12,455

At December 31, 2018, future minimum payments under noncancellable operating leases under ASC 840 were as follows:



	Cash Payments Due by Year
(in thousands)	Total		2019		2020		2021		2022		2023		Thereafter
Operating leases	$	22,757	$	2,483	$	2,495	$	2,335	$	2,355	$	2,420	$	10,669

Stock-Based Compensation - Total Stock-Based Compensation Expense (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock-based compensation expense	$ 13,458	$ 11,666	$ 10,465
Research and development
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock-based compensation expense	3,207	1,290	1,152
Selling, general and administrative
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock-based compensation expense	$ 10,251	$ 10,376	$ 9,313

Leases - Lease Assets and Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Leases [Abstract]
Operating lease assets	$ 11,180	$ 0
Operating lease current liabilities	2,147	0
Operating lease non-current liabilities	12,455	$ 0
Total lease liabilities	$ 14,602
Weighted average remaining lease term	8 years 1 month 6 days
Weighted average discount rate	8.10%

Quarterly Financial Data (Unaudited) (Tables)

12 Months Ended

Dec. 31, 2019

Quarterly Financial Information Disclosure [Abstract]

Quarterly Financial Data

The following is a summary of quarterly financial data for the years ended December 31, 2019 and 2018:



(in thousands, except for per share amounts)	First Quarter			Second Quarter		Third Quarter		Fourth Quarter
Year Ended December 31, 2019
Revenues	$	47,713		$	59,060	$	59,485	$	60,930
Gross profit (1)	42,220			52,313		52,327		54,335
Income (loss) from operations	(2,087		)	9,895		10,759		4,243
Net income (loss)	(612		)	11,526		100,423		4,216
Net income (loss) per share, basic	$	(0.01	)	$	0.22	$	1.88	$	0.08
Net income (loss) per share, diluted	$	(0.01	)	$	0.21	$	1.84	$	0.08
Year Ended December 31, 2018
Revenues	$	43,592		$	47,350	$	49,135	$	53,041
Gross profit (1)	38,680			41,739		43,670		46,994
Income from operations	2,442			3,913		6,233		9,150
Net income	3,066			4,611		7,171		10,360
Net income per share, basic	$	0.07		$	0.09	$	0.14	$	0.20
Net income per share, diluted	$	0.06		$	0.09	$	0.13	$	0.19

(1)

Gross profit includes revenues less cost of goods sold, excluding amortization, and less intangible asset amortization.

Accounts Payable and Accrued Liabilities (Tables)

12 Months Ended

Dec. 31, 2019

Payables and Accruals [Abstract]

Summary of Accounts Payable and Accrued Liabilities

The following is a summary of the Company’s accounts payable and accrued liabilities as of December 31, 2019 and 2018:



(in thousands)	December 31, 2019		December 31, 2018
Compensation and employee benefits	$	6,597	$	6,363
Royalties payable	5,904		5,172
Research and development expenses	5,893		5,593
Consulting and other professional fees	5,376		2,924
Operating lease liabilities	2,147		—
Other	1,673		1,532
Total accounts payable and accrued liabilities	$	27,590	$	21,584

Income Taxes - Components of Deferred Tax Assets, Net and Related Valuation Allowance (Detail) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Deferred tax assets:
Net operating loss carryforwards	$ 52,034	$ 55,742
Stock-based compensation	5,298	5,202
Accrued and deferred expenses	2,101	2,096
Allowance for returns and uncollectable receivables	1,468	1,247
Research and development and orphan drug credit carryforwards	36,041	48,066
Other	1,301	1,405
Total deferred tax assets	98,243	113,758
Deferred tax liabilities:
Intangible assets	(1,994)	(1,247)
Other	(414)	(576)
Total deferred tax liabilities	(2,408)	(1,823)
Deferred tax assets, net	95,835	111,935
Less: Valuation allowance	8,155	111,950	$ 116,110	$ 146,012
Net deferred tax assets	$ 87,680
Net deferred tax liabilities		$ (15)

Summary of Significant Accounting Policies - Additional Information (Detail) $ in Thousands	1 Months Ended	12 Months Ended			23 Months Ended
	Feb. 08, 2018	Dec. 31, 2019 USD ($) Segment	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)	Dec. 31, 2019 USD ($)	Jan. 01, 2019 USD ($)
Summary Of Significant Accounting Policies [Line Items]
Percentage of insurance coverage gap allocated for prescription drugs under Medicare Part D	50.00%				70.00%
Advertising expenses		$ 3,200	$ 900	$ 1,300
Number of reportable segments \| Segment		1
Total lease liabilities		$ 14,602			$ 14,602
Operating lease current liabilities		2,147	0		2,147
Operating lease right-of-use assets		$ 11,180	$ 0		$ 11,180
Accounting Standards Update 2016-02
Summary Of Significant Accounting Policies [Line Items]
Total lease liabilities						$ 15,800
Operating lease current liabilities						2,200
Operating lease right-of-use assets						$ 12,200

Cover Page - USD ($) $ in Millions	12 Months Ended
Cover Page - USD ($) $ in Millions	Dec. 31, 2019	Feb. 18, 2020	Jun. 30, 2019
Cover page.
Document Type	10-K
Document Annual Report	true
Document Period End Date	Dec. 31, 2019
Document Transition Report	false
Entity File Number	001-34186
Entity Registrant Name	VANDA PHARMACEUTICALS INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	03-0491827
Entity Address, Address Line One	2200 Pennsylvania Avenue NW
Entity Address, Address Line Two	Suite 300 E
Entity Address, City or Town	Washington
Entity Address, State or Province	DC
Entity Address, Postal Zip Code	20037
City Area Code	202
Local Phone Number	734-3400
Title of 12(b) Security	Common Stock, par value $0.001 per share
Trading Symbol	VNDA
Security Exchange Name	NASDAQ
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Documents Incorporated by Reference	DOCUMENTS INCORPORATED BY REFERENCE Specified portions of the registrant’s proxy statement with respect to the registrant’s 2020 Annual Meeting of Stockholders, which is to be filed pursuant to Regulation 14A within 120 days after the end of the registrant’s fiscal year ended December 31, 2019, are incorporated by reference into Part III of this Form 10-K.
Amendment Flag	false
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	FY
Entity Central Index Key	0001347178
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		53,648,617
Entity Public Float			$ 731.2

Property and Equipment (Tables)

12 Months Ended

Dec. 31, 2019

Property, Plant and Equipment [Abstract]

Summary of Property and Equipment-at Cost

The following is a summary of the Company’s property and equipment, at cost, as of December 31, 2019 and 2018:



(in thousands)	Estimated Useful Life (Years)	December 31, 2019			December 31, 2018
Computer and other equipment	3	$	4,398		$	3,642
Furniture and fixtures	5 - 7	1,491			1,488
Leasehold improvements	5 - 11	4,587			4,506
Total property and equipment, gross		10,476			9,636
Accumulated depreciation and amortization		(6,612		)	(5,219		)
Total property and equipment, net		$	3,864		$	4,417

Stock-Based Compensation

12 Months Ended

Dec. 31, 2019

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock-Based Compensation

As of December 31, 2019, there were 6,144,430 shares that were subject to outstanding options and RSUs under the 2006 Equity Incentive Plan (2006 Plan) and the Amended and Restated 2016 Equity Incentive Plan (2016 Plan, and together with the 2006 Plan, Plans). The 2006 Plan expired by its terms on April 12, 2016, and the Company adopted the 2016 Plan. Outstanding options and RSUs under the 2006 Plan remain in effect and the terms of the 2006 Plan continue to apply, but no additional awards can be granted under the 2006 Plan. In June 2016, the Company’s stockholders approved the 2016 Plan. The 2016 Plan has been amended and restated twice to increase the number of shares reserved for issuance, among other administrative changes. Both amendments and restatements of the 2016 Plan were approved by the Company's stockholders. There are a total of 7,100,000 shares of common stock reserved for issuance under the 2016 Plan, 3,026,147 shares of which remained available for future grant as of December 31, 2019.

Stock Options

The Company has granted option awards under the Plans with service conditions (service option awards) that are subject to terms and conditions established by the compensation committee of the board of directors. Service option awards have 10-year contractual terms. Service option awards granted to employees and new directors upon their election vest and become exercisable over four years, with the first 25% of the shares subject to service option awards vesting on the first anniversary of the grant date and the remaining 75% of the shares subject to the service option awards in 36 equal monthly installments thereafter. Subsequent annual service option awards granted to directors vest and become exercisable in full on the first anniversary of the grant date. Certain service option awards to executives and directors provide for accelerated vesting if there is a change in control of the Company. Certain service option awards to employees and executives provide for accelerated vesting if the respective employee’s or executive’s service is terminated by the Company for any reason other than cause or permanent disability.

As of December 31, 2019, $9.8 million of unrecognized compensation costs related to unvested service option awards are expected to be recognized over a weighted average period of 1.4 years. No option awards are classified as a liability as of December 31, 2019.

The following is a summary of option activity for the 2006 Plan and the 2016 Plan for the years ended December 31, 2019, 2018, and 2017:



2006 and 2016 Plans (in thousands, except for share and per share amounts)	Number of Shares		Weighted Average Exercise Price at Grant Date		Weighted Average Remaining Term (Years)	Aggregate Intrinsic Value
Outstanding at December 31, 2016	5,548,336		$	11.62	5.58	$	32,453
Granted	643,000		14.44
Forfeited	(290,729	)	10.73
Expired	(605,617	)	29.87
Exercised	(575,206	)	9.13			3,140
Outstanding at December 31, 2017	4,719,784		10.03		5.63	24,421
Granted	567,500		19.22
Forfeited	(232,527	)	13.99
Exercised	(685,715	)	9.12			5,945
Outstanding at December 31, 2018	4,369,042		11.15		5.28	65,438
Granted	687,500		18.38
Forfeited	(53	)	7.94
Expired	(15,000	)	14.78
Exercised	(546,344	)	11.47			2,482
Outstanding at December 31, 2019	4,495,145		12.21		5.58	22,148
Exercisable at December 31, 2019	3,371,836		10.31		4.53	21,200
Vested and expected to vest at December 31, 2019	4,354,708		12.02		5.46	22,039

The weighted average grant-date fair value of options granted was $10.19, $10.66 and $7.81 per share for the years ended December 31, 2019, 2018 and 2017, respectively. Proceeds from the exercise of stock options amounted to $6.3 million, $6.3 million and $5.3 million for the years ended December 31, 2019, 2018 and 2017, respectively.

Restricted Stock Units

An RSU is a stock award that entitles the holder to receive shares of the Company’s common stock as the award vests. The fair value of each RSU is based on the closing price of the Company’s stock on the date of grant. The Company has granted RSUs under the Plans with service conditions (service RSUs) that vest in four equal annual installments provided that the employee remains employed with the Company. Annual service RSUs granted to directors vest on the first anniversary of the grant date.

As of December 31, 2019, $22.8 million of unrecognized compensation costs related to unvested service RSUs are expected to be recognized over a weighted average period of 1.8 years. No RSUs are classified as a liability as of December 31, 2019.

The following is a summary of RSU activity for the 2006 Plan and the 2016 Plan for the years ended December 31, 2019, 2018, and 2017:



RSUs	Number of Shares		Weighted Average Grant Date Fair Value
Unvested at December 31, 2016	1,138,428		$	10.07
Granted	857,336		14.57
Forfeited	(275,613	)	11.41
Vested	(362,313	)	9.78
Unvested at December 31, 2017	1,357,838		12.72
Granted	714,086		18.93
Forfeited	(229,603	)	15.19
Vested	(528,745	)	12.69
Unvested at December 31, 2018	1,313,576		15.68
Granted	937,328		19.46
Forfeited	(75,444	)	18.93
Vested	(526,175	)	14.54
Unvested at December 31, 2019	1,649,285		18.04

The grant date fair value for the 526,175 shares underlying RSUs that vested during the year ended December 31, 2019 was $7.7 million.

Stock-Based Compensation Expense

Stock-based compensation expense recognized for the years ended December 31, 2019, 2018 and 2017 was allocated as follows:



	Year Ended December 31,
(in thousands)	2019		2018		2017
Research and development	$	3,207	$	1,290	$	1,152
Selling, general and administrative	10,251		10,376		9,313
Total stock-based compensation expense	$	13,458	$	11,666	$	10,465

The fair value of each option award is estimated on the date of grant using the Black-Scholes-Merton option pricing model that uses the assumptions noted in the following table. Expected volatility rates are based on the historical volatility of the Company’s publicly traded common stock and other factors. The risk-free interest rates are based on the U.S. Treasury yield for a period consistent with the expected term of the option in effect at the time of the grant. The Company has never paid cash dividends to its stockholders and does not plan to pay dividends in the foreseeable future. Assumptions used in the Black-Scholes-Merton option pricing model for employee and director stock options granted during the years ended December 31, 2019, 2018 and 2017 were as follows:



	Year Ended December 31,
	2019		2018		2017
Expected dividend yield	—	%	—	%	—	%
Weighted average expected volatility	58	%	58	%	57	%
Weighted average expected term (years)	5.95		5.90		5.89
Weighted average risk-free rate	2.26	%	2.68	%	1.97	%

Stock-Based Compensation - Black-Scholes-Merton Option Pricing Model for Stock Options Granted (Detail)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Expected dividend yield	0.00%	0.00%	0.00%
Weighted average expected volatility	58.00%	58.00%	57.00%
Weighted average expected term (years)	5 years 11 months 12 days	5 years 10 months 24 days	5 years 10 months 20 days
Weighted average risk-free rate	2.26%	2.68%	1.97%

CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Dec. 31, 2019	Dec. 31, 2018
Statement of Financial Position [Abstract]
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized (in shares)	20,000,000	20,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	150,000,000	150,000,000
Common stock, shares issued (in shares)	53,549,612	52,477,593
Common stock, shares outstanding (in shares)	53,549,612	52,477,593

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Cash flows from operating activities
Net income (loss)	$ 115,553	$ 25,208	$ (15,567)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation of property and equipment	1,387	1,429	1,234
Stock-based compensation	13,458	11,666	10,465
Amortization of discounts and premiums on marketable securities	(3,099)	(2,221)	(426)
Intangible asset amortization	1,505	1,527	1,750
Deferred income taxes	(87,767)	0	0
Other non-cash adjustments, net	1,785	167	587
Changes in operating assets and liabilities:
Accounts receivable	2,342	(11,207)	2,525
Prepaid expenses and other assets	(2,764)	(4,258)	3,652
Inventory	(722)	70	(1,060)
Accounts payable and other liabilities	3,508	(618)	5,953
Product revenue allowances	761	8,223	(11,096)
Net cash provided by (used in) operating activities	45,947	29,986	(1,983)
Cash flows from investing activities
Acquisition of intangible asset	0	(25,000)	0
Purchases of property and equipment	(1,019)	(368)	(1,664)
Purchases of marketable securities	(394,517)	(282,395)	(148,135)
Maturities of marketable securities	327,227	198,103	139,568
Net cash used in investing activities	(68,309)	(109,660)	(10,231)
Cash flows from financing activities
Net proceeds from offering of common stock	0	100,870	0
Proceeds from exercise of employee stock options	6,264	6,256	5,251
Net cash provided by financing activities	6,264	107,126	5,251
Effect of exchange rate changes on cash, cash equivalents and restricted cash	(1)	(38)	42
Net increase (decrease) in cash, cash equivalents and restricted cash	(16,099)	27,414	(6,921)
Cash, cash equivalents and restricted cash
Beginning of year	61,749	34,335	41,256
End of year	$ 45,650	$ 61,749	$ 34,335

Earnings per Share (Tables)

12 Months Ended

Dec. 31, 2019

Earnings Per Share [Abstract]

Basic and Diluted Net Income (Loss) Per Share of Common Stock

The following table presents the calculation of basic and diluted net income (loss) per share of common stock for the years ended December 31, 2019, 2018 and 2017:



	Year Ended December 31,
(in thousands, except for share and per share amounts)	2019		2018		2017
Numerator:
Net income (loss)	$	115,553	$	25,208	$	(15,567	)
Denominator:
Weighted average shares outstanding, basic	53,137,562		50,859,947		44,735,146
Effect of dilutive securities	1,709,498		2,185,310		—
Weighted average shares outstanding, diluted	54,847,060		53,045,257		44,735,146
Net income (loss) per share, basic and diluted:
Basic	$	2.17	$	0.50	$	(0.35	)
Diluted	$	2.11	$	0.48	$	(0.35	)
Antidilutive securities excluded from calculations of diluted net income (loss) per share	1,932,024		903,265		3,136,515

Quarterly Financial Data (Unaudited)

12 Months Ended

Dec. 31, 2019

Quarterly Financial Information Disclosure [Abstract]

Quarterly Financial Data (Unaudited)

The following is a summary of quarterly financial data for the years ended December 31, 2019 and 2018:



(in thousands, except for per share amounts)	First Quarter			Second Quarter		Third Quarter		Fourth Quarter
Year Ended December 31, 2019
Revenues	$	47,713		$	59,060	$	59,485	$	60,930
Gross profit (1)	42,220			52,313		52,327		54,335
Income (loss) from operations	(2,087		)	9,895		10,759		4,243
Net income (loss)	(612		)	11,526		100,423		4,216
Net income (loss) per share, basic	$	(0.01	)	$	0.22	$	1.88	$	0.08
Net income (loss) per share, diluted	$	(0.01	)	$	0.21	$	1.84	$	0.08
Year Ended December 31, 2018
Revenues	$	43,592		$	47,350	$	49,135	$	53,041
Gross profit (1)	38,680			41,739		43,670		46,994
Income from operations	2,442			3,913		6,233		9,150
Net income	3,066			4,611		7,171		10,360
Net income per share, basic	$	0.07		$	0.09	$	0.14	$	0.20
Net income per share, diluted	$	0.06		$	0.09	$	0.13	$	0.19

(1)

Gross profit includes revenues less cost of goods sold, excluding amortization, and less intangible asset amortization.

Intangible Assets (Tables)

12 Months Ended

Dec. 31, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

Summary of Intangible Assets

The following is a summary of the Company’s intangible assets as of December 31, 2019:



		December 31, 2019
(in thousands)	Estimated Useful Life (Years)	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
HETLIOZ^®	July 2035	$	33,000	$	9,963	$	23,037

The following is a summary of the Company’s intangible assets as of December 31, 2018:



		December 31, 2018
(in thousands)	Estimated Useful Life (Years)	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
HETLIOZ^®	February 2035	$	33,000	$	8,458	$	24,542

Summary of Amortization Expense

Amortization expense for the years ended December 31, 2019, 2018 and 2017 was as follows:



	Year Ended December 31,
(in thousands)	2019		2018		2017
HETLIOZ^®	$	1,505	$	1,527	$	1,750

Summary of Future Intangible Asset Amortization

The following is a summary of the future intangible asset amortization schedule as of December 31, 2019:



(in thousands)	Total		2020		2021		2022		2023		2024		Thereafter
HETLIOZ^®	$	23,037	$	1,478	$	1,478	$	1,478	$	1,478	$	1,478	$	15,647

Commitments and Contingencies	12 Months Ended
Commitments and Contingencies	Dec. 31, 2019
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies Guarantees and Indemnifications The Company has entered into a number of standard intellectual property indemnification agreements in the ordinary course of its business. Pursuant to these agreements, the Company indemnifies, holds harmless, and agrees to reimburse the indemnified party for losses suffered or incurred by the indemnified party, generally the Company’s business partners or customers, in connection with any U.S. patent or any copyright or other intellectual property infringement claim by any third party with respect to the Company’s products. The term of these indemnification agreements is generally perpetual from the date of execution of the agreement. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited. Since inception, the Company has not incurred costs to defend lawsuits or settle claims related to these indemnification agreements. The Company also indemnifies its officers and directors for certain events or occurrences, subject to certain conditions. License Agreements The Company’s rights to develop and commercialize its products are subject to the terms and conditions of licenses granted to the Company by other pharmaceutical companies. HETLIOZ^®. In February 2004, the Company entered into a license agreement with BMS under which it received an exclusive worldwide license under certain patents and patent applications, and other licenses to intellectual property, to develop and commercialize HETLIOZ^®. To date, the Company has paid BMS $37.5 million in upfront fees and milestone obligations, including $33.0 million of regulatory approval and commercial milestones capitalized as intangible assets (see Note 8). The Company has no remaining milestone obligations to BMS. Additionally, the Company is obligated to make royalty payments on HETLIOZ^® net sales to BMS in any territory where the Company commercializes HETLIOZ^® for a period equal to the greater of 10 years following the first commercial sale in the territory or the expiry of the new chemical entity (NCE) patent in that territory. During the period prior to the expiry of the NCE patent in a territory, the Company is obligated to pay a 10% royalty on net sales in that territory. The royalty rate is decreased by half for countries in which no NCE patent existed or for the remainder of the 10 years after the expiry of the NCE patent. The Company is also obligated under the license agreement to pay BMS a percentage of any sublicense fees, upfront payments and milestone and other payments (excluding royalties) that it receives from a third party in connection with any sublicensing arrangement, at a rate which is in the mid-twenties. The Company has agreed with BMS in the license agreement for HETLIOZ^® to use its commercially reasonable efforts to develop and commercialize HETLIOZ^®. Fanapt^®. Pursuant to the terms of a settlement agreement with Novartis, Novartis transferred all U.S. and Canadian rights in the Fanapt^® franchise to the Company on December 31, 2014. The Company paid directly to Sanofi S.A. (Sanofi) a fixed royalty of 3% of net sales from November 16, 2016 through December 31, 2019 related to manufacturing know-how. The Company is also obligated to pay Sanofi a fixed royalty on Fanapt^® net sales equal to 6% on Sanofi know-how not related to manufacturing under certain conditions for a period of up to 10 years in markets where the NCE patent has expired or was not issued. The Company is obligated to pay this 6% royalty on net sales in the U.S. through November 2026. Tradipitant. In April 2012, the Company entered into a license agreement with Eli Lilly and Company (Lilly) pursuant to which the Company acquired an exclusive worldwide license under certain patents and patent applications, and other licenses to intellectual property, to develop and commercialize an NK-1R antagonist, tradipitant, for all human indications. Lilly is eligible to receive future payments based upon achievement of specified development, regulatory approval and commercialization milestones as well as tiered-royalties on net sales at percentage rates up to the low double digits. To date, the Company has paid Lilly $3.0 million in upfront fees and development milestones, including a $2.0 million milestone payment in July 2018 as a result of enrolling the first subject into a Phase III study for tradipitant. As of December 31, 2019, remaining milestone obligations include a $2.0 million development milestone due upon the filing of the first marketing authorization for tradipitant either in the U.S. or European Union (E.U.), $10.0 million and $5.0 million for the first approval of a marketing authorization for tradipitant in the U.S. and E.U., respectively, and up to $80 million for sales milestones. The Company is obligated to use its commercially reasonable efforts to develop and commercialize tradipitant. VQW-765. In connection with a settlement agreement with Novartis relating to Fanapt^®, the Company received an exclusive worldwide license under certain patents and patent applications, and other licenses to intellectual property, to develop and commercialize VQW-765, a Phase II alpha-7 nicotinic acetylcholine receptor partial agonist. Pursuant to the license agreement, the Company is obligated to use its commercially reasonable efforts to develop and commercialize VQW-765 and is responsible for all development costs. The Company has no milestone obligations; however, Novartis is eligible to receive tiered-royalties on net sales at percentage rates up to the mid-teens. Portfolio of CFTR activators and inhibitors. In March 2017, the Company entered into a license agreement with the University of California San Francisco (UCSF), under which the Company acquired an exclusive worldwide license to develop and commercialize a portfolio of CFTR activators and inhibitors. Pursuant to the license agreement, the Company will develop and commercialize the CFTR activators and inhibitors and is responsible for all development costs under the license agreement, including current pre-investigational new drug development work. UCSF is eligible to receive future payments based upon achievement of specified development and commercialization milestones as well as single-digit royalties on net sales. To date, the Company has paid UCSF $1.2 million in upfront fees and development milestones, including an upfront license fee payment of $1.0 million in 2017 and a $0.2 million development milestone payment in the March 2019. As of December 31, 2019, remaining milestone obligations include $12.2 million for development milestones and $33.0 million for future regulatory approval and sales milestones. Included in the $12.2 million in development milestones is a $350,000 milestone due upon the conclusion of a Phase I study for each licensed product but not to exceed $1.1 million in total for the CFTR portfolio. Purchase Commitments In the course of its business, the Company regularly enters into agreements with clinical organizations to provide services relating to clinical development and clinical manufacturing activities under fee service arrangements. The Company’s current agreements for clinical and marketing services may be terminated on generally 90 days’ notice without incurring additional charges, other than charges for work completed but not paid for through the effective date of termination and other costs incurred by the Company’s contractors in closing out work in progress as of the effective date of termination. Noncancellable long-term contractual cash obligations include noncancellable purchase commitments longer than one year and primarily relate to commitments for media and data services, of which $9.2 million, $1.0 million and $0.5 million are expected to be paid in 2020, 2021 and 2022, respectively.

Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2019

Accounting Policies [Abstract]

Business organization


•	HETLIOZ^® (tasimelteon) for the treatment of jet lag disorder, Smith-Magenis Syndrome (SMS), pediatric Non-24 and delayed sleep phase disorder (DSPD);


•	Fanapt^® (iloperidone) for the treatment of bipolar disorder and a long acting injectable (LAI) formulation program for the treatment of schizophrenia;

•

Tradipitant (VLY-686), a small molecule neurokinin-1 receptor (NK-1R) antagonist, for the treatment of atopic dermatitis, gastroparesis and motion sickness;

Basis of presentation

Basis of Presentation

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (GAAP) requires management to make estimates that affect the reported amounts of assets and liabilities at the date of the financial statements, disclosure of contingent assets and liabilities, and the reported amounts of revenue and expenses during the reporting period. Management continually re-evaluates its estimates, judgments and assumptions, and management’s evaluation could change. Actual results could differ from those estimates.

Cash and Cash Equivalents

Cash, Cash Equivalents and Restricted Cash

For purposes of the Consolidated Balance Sheets and Consolidated Statements of Cash Flows, cash equivalents represent highly-liquid investments with a maturity date of three months or less at the date of purchase. Cash and cash equivalents include investments in money market funds with commercial banks and financial institutions, and commercial paper of high-quality corporate issuers. Restricted cash relates primarily to amounts held as collateral for letters of credit for leases for office space at the Company’s Washington, D.C. headquarters.

Marketable Securities

The Company classifies all of its marketable securities as available-for-sale securities. The Company’s investment policy requires the selection of high-quality issuers. Available-for-sale securities are carried at fair market value, with unrealized gains and losses reported as a component of stockholders’ equity in accumulated other comprehensive income (loss). At each balance sheet date, the Company assesses available-for-sale securities in an unrealized loss position to determine whether the unrealized loss is other-than-temporary. If declines in the value of available for-sale securities are determined to be other-than-temporary, a loss is recorded in earnings in the current period. Interest and dividend income is recorded when earned and included in other income. Premiums and discounts on marketable securities are amortized and accreted, respectively, to earliest call date and maturity, respectively, and included in other income. The Company uses the specific identification method in computing realized gains and losses on the sale of investments, which would be included in the consolidated statements of operations when generated. All available-for-sale marketable securities are available for use in current operations and are classified as current.

Inventory

Inventory, which is recorded at the lower of cost or net realizable value, includes the cost of third-party manufacturing and other direct and indirect costs and is valued using the first-in, first-out method. The Company capitalizes inventory costs associated with its products upon regulatory approval when, based on management’s judgment, future commercialization is considered probable and the future economic benefit is expected to be realized; otherwise, such costs are expensed as research and development. Inventory not expected to be sold within 12 months following the balance sheet date are classified as non-current.

Intangible Assets

Costs incurred for products not yet approved by the FDA and for which no alternative future use exists are recorded as expense. Obligations for milestone payments to other pharmaceutical companies that may result in a capitalized intangible asset are recognized when it is deemed probable that the milestone event will occur. In the event a product has been approved by the FDA or an alternative future use exists for a product, patent and license costs are capitalized and amortized on a straight-line basis over the estimated useful economic life of the of the related product patents. For intangible assets related to HETLIOZ^®, the estimated useful life is the estimated economic useful life of the related product patents, the latest of which expires in July 2035. Intangible assets related Fanapt^® have been fully amortized on a straight-line basis to November 2016. The useful life estimate for Fanapt^® was based on the market participant methodology prescribed by ASC 805, and therefore does not reflect the impact of additional Fanapt^® patents solely owned by the Company with varying expiration dates, the latest of which is December 2031.

Property and Equipment

Property and equipment are stated at cost less accumulated depreciation. Depreciation of most property and equipment is provided on a straight-line basis over the estimated useful lives of the assets. Leasehold improvements are amortized using a straight-line basis over the lesser of the estimated useful lives of the assets or the terms of the related leases. The costs of additions and improvements are capitalized, and repairs and maintenance costs are charged to operations in the period incurred. Upon retirement or disposition of property and equipment, the cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is reflected in the statement of operations for that period.

Leases

In accordance with Accounting Standards Codification (ASC) 842, Leases, effective January 1, 2019, the Company determines if an arrangement contains a lease at inception. Right-of-use (ROU) assets represent the Company's right to use an underlying asset for the lease term and lease liabilities represent the Company's obligation to make lease payments arising from that lease. For leases with a term greater than 12 months, ROU assets and liabilities are recognized at the lease commencement date based on the estimated present value of lease payments over the lease term. The lease term includes the option to extend the lease when it is reasonably certain the Company will exercise that option. When available, the Company uses the rate implicit in the lease to discount lease payments to present value. In the case the implicit rate is not available, the Company uses its incremental borrowing rate based on information available at the lease commencement date, including publicly available data for instruments with similar characteristics, to determine the present value of lease payments. The Company does not combine lease and non-lease elements for office leases. For existing leases as of January 1, 2019, executory costs are excluded from lease expense, which is consistent with the Company's accounting under ASC 840, Leases. For all leases entered into after January 1, 2019, executory costs are allocated between lease and non-lease elements based upon their relative stand-alone prices.

Accounts Payable and Accrued Liabilities

The Company’s management is required to estimate accrued liabilities as part of the process of preparing financial statements. The estimation of accrued liabilities involves identifying services that have been performed on the Company’s behalf, and then estimating the level of service performed and the associated cost incurred for such services as of each balance sheet date in the financial statements. Accrued liabilities include research and development expenses, such as accrued costs under contracts with clinical monitors, data management organizations and investigators in conjunction with clinical trials, fees to contract manufacturers in conjunction with the production of clinical materials, consulting and professional fees, such as lawyers and fees for marketing and other commercialization activities, accrued compensation and employee benefits, such as accrued bonus, royalties payable under licensing agreements, and other accrued fees. Pursuant to management’s assessment of the services that have been performed on clinical trials and other contracts, the Company recognizes these expenses as the services are provided. Such management assessments include, but are not limited to: (i) an evaluation by the project manager of the work that has been completed during the period, (ii) measurement of progress prepared internally and/or provided by the third-party service provider, (iii) analyses of data that justify the progress, and (iv) management’s judgment. In the event that the Company does not identify certain costs that have begun to be incurred or the Company under- or over-estimates the level of services performed or the costs of such services, the Company’s reported expenses for such period would be too low or too high.

Revenue Recognition

In accordance with ASC Subtopic 606 Revenue from Contracts with Customers (ASC 606), which the Company adopted January 1, 2018, the Company accounts for a contract when it has approval and commitment from both parties, the rights of the parties are identified, payment terms are identified, the contract has commercial substance and collectability of consideration is probable. The Company recognizes revenue when control of the product is transferred to the customer in an amount that reflects the consideration the Company expects to be entitled to in exchange for those product sales, which is typically once the product physically arrives at the customer. Sales taxes, value add taxes, and usage-based taxes are excluded from revenues.

Major Customers

HETLIOZ^® is available in the U.S. for distribution through a limited number of specialty pharmacies, and is not available in retail pharmacies. Specialty pharmacy customers include Diplomat Pharmacy, Inc. (a subsidiary of UnitedHealth Group) and Accredo (a subsidiary of Express Scripts). Fanapt^® is available in the U.S. for distribution through a limited number of wholesalers and is available in retail pharmacies. Wholesaler customers include Cardinal Health, Inc., AmerisourceBergen

Drug Corporation, and McKesson Corporation. The Company invoices and records revenue when its customers, specialty pharmacies and wholesalers, receive product from the third-party logistics warehouse which is the point at which control is transferred to the customer. Revenues and accounts receivable are concentrated with these customers. The Company evaluates outstanding receivables to assess collectability. In performing this evaluation, the Company analyzes economic conditions, the aging of receivables and customer specific risks.

Reserves for Variable Consideration

The transaction price is determined based upon the consideration to which the Company will be entitled in exchange for transferring product to the customer. The Company’s product sales are recorded net of applicable product revenue allowances for which reserves are established and include discounts, rebates, chargebacks, service fees, co-pay assistance and product returns that are applicable for various government and commercial payors. The Company estimates the amount of variable consideration that should be included in the transaction price utilizing the most likely amount method and updates its estimate at each reporting date. Variable consideration is included in the transaction price if, in the Company’s judgment, it is probable that a significant future reversal of cumulative revenue under the contract will not occur. Allowances for rebates, chargebacks and co-pay assistance are based upon the insurance benefits of the end customer, which are estimated using historical activity and, where available, actual and pending prescriptions for which the Company has validated the insurance benefits. Reserves for variable consideration are classified as product revenue allowances on the consolidated balance sheets, with the exception of prompt-pay discounts which are classified as reductions of accounts receivable. The reserve for product returns for which the product may not be returned for a period of greater than one year from the balance sheet date is included as a component of other non-current liabilities in the consolidated balance sheets. Uncertainties related to variable consideration are generally resolved in the quarter subsequent to period end, with the exception of Medicaid rebates, which are dependent upon the timing of when states submit reimbursement claims, and product returns which are resolved during the product expiry period specified in the customer contract. The Company currently records sales allowances for the following:

Prompt-pay: Specialty pharmacies and wholesalers are offered discounts for prompt payment. The Company expects that the specialty pharmacies and wholesalers will earn prompt payment discounts and, therefore, deducts the full amount of these discounts from total product sales when revenues are recognized.

Rebates: Allowances for rebates include mandated discounts under the Medicaid Drug Rebate Program as well as contracted rebate programs with other payors. Rebate amounts owed after the final dispensing of the product to a benefit plan participant are based upon contractual agreements or legal requirements with public sector benefit providers, such as Medicaid. The allowance for rebates is based on statutory or contracted discount rates and estimated patient utilization.

Chargebacks: Chargebacks are discounts that occur when contracted indirect customers purchase directly from specialty pharmacies and wholesalers. Contracted indirect customers, which currently consist primarily of Public Health Service institutions, non-profit clinics, and federal government entities purchasing via the Federal Supply Schedule, generally purchase the product at a discounted price. The specialty pharmacy or wholesaler, in turn, charges back the difference between the price initially paid by the specialty pharmacy or wholesaler and the discounted price paid to the specialty pharmacy or wholesaler by the contracted customer.

Medicare Part D Coverage Gap: Medicare Part D prescription drug benefit mandates manufacturers to fund approximately 50% of the Medicare Part D insurance coverage gap for prescription drugs sold to eligible patients through 2018. Public Law No. 115-123, also known as the Bipartisan Budget Act of 2018 enacted on February 9, 2018 increased the manufacturer discount from 50% to 70% effective in 2019 for applicable drugs. Vanda accounts for the Medicare Part D coverage gap using a point of sale model. Estimates for expected Medicare Part D coverage gap are based in part on historical activity and, where available, actual and pending prescriptions for which the Company has validated the insurance benefits.

Service Fees: The Company receives sales order management, data and distribution services from certain customers. These fees are based on contracted terms and are known amounts. The Company accrues service fees at the time of revenue recognition, resulting in a reduction of product sales and the recognition of an accrued liability, unless it is a payment for a distinct good or service from the customer in which case the fair value of those distinct goods or services are recorded as selling, general and administrative expense.

Co-payment Assistance: Patients who have commercial insurance and meet certain eligibility requirements may receive co-payment assistance. Co-pay assistance utilization is based on information provided by the Company’s third-party administrator.

Product Returns: The Company generally offers direct customers a limited right to return as contractually defined with the customers. The Company considers several factors in the estimation process, including expiration dates of product shipped to customers, inventory levels within the distribution channel, product shelf life, historical return activity, including activity for product sold for which the return period has past, prescription trends and other relevant factors. The Company does not expect returned goods to be resalable. There was no right of return asset as of December 31, 2019 or 2018.

Cost of Goods Sold

Cost of goods sold includes royalties payable, the cost of inventory sold, manufacturing and supply chain costs and product shipping and handling costs related to sales of HETLIOZ^® and Fanapt^® to the Company’s distribution partners.

Research and Development Expenses

Research and development expenses consist primarily of fees for services provided by third parties in connection with the clinical trials, costs of contract manufacturing services, milestone payments, costs of materials used in clinical trials and research and development, costs for regulatory consultants and filings, depreciation of capital resources used to develop products, related facilities costs, and salaries, other employee-related costs and stock-based compensation for research and development personnel. The Company expenses research and development costs as they are incurred for products in the

development stage, including manufacturing costs and milestone payments made under license agreements prior to FDA approval. Upon and subsequent to FDA approval, manufacturing and milestone payments related to license agreements are capitalized. Milestone payments are accrued when it is deemed probable that the milestone event will be achieved. Costs related to the acquisition of intellectual property are expensed as incurred if the underlying technology is developed in connection with the Company’s research and development efforts and has no alternative future use.

Selling, General and Administrative Expenses

Selling, general and administrative expenses consist of salaries, stock-based compensation, facilities and third party expenses. Selling, general and administrative expenses are associated with the activities of the corporate, finance, accounting, information technology, business development, commercial support, trade and distribution, sales, marketing, legal, medical affairs and human resource functions. Additionally, selling, general and administrative expenses included an estimate for the annual Affordable Care Act fee.

Stock-Based Compensation

Compensation costs for all stock-based awards to employees and directors are measured based on the grant date fair value of those awards and recognized over the period during which the employee or director is required to perform service in exchange for the award. The Company recognizes the expense over the award’s vesting period. The fair value of stock options granted and restricted stock units (RSUs) awarded are amortized using the straight-line method. As stock-based compensation expense recognized in the consolidated statements of operations is based on awards ultimately expected to vest, it has been reduced for estimated forfeitures. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates.

Advertising Expense

The Company expenses the costs of advertising, including branded promotional expenses, as incurred. Branded advertising expenses, recorded in selling, general and administrative expenses, were $3.2 million, $0.9 million and $1.3 million for the years ended December 31, 2019, 2018 and 2017, respectively.

Foreign Currency

The reporting currency of the Company is the U.S. dollar. The functional currency of the Company’s international subsidiaries is the local currency. Assets and liabilities denominated in foreign currencies, including intercompany balances for which settlement is anticipated in the foreseeable future, are translated at exchange rates in effect at the balance sheet date. Foreign currency equity balances are translated at historical rates. Revenues and expenses denominated in foreign currencies are translated at average exchange rates for the respective periods. Foreign currency translation adjustments are recorded in accumulated other comprehensive income (loss).

Transactions denominated in currencies other than subsidiaries’ functional currencies are recorded based on exchange rates at the time such transactions arise. Changes in exchange rates with respect to amounts recorded in the consolidated balance sheets related to these items will result in unrealized foreign currency transaction gains and losses based upon period-end exchange rates. The Company also records realized foreign currency transaction gains and losses upon settlement of the transactions.

Income Taxes

Recent Accounting Pronouncements

In December 2019, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, which clarifies and simplifies certain aspects of the accounting for income taxes. The standard is effective for years beginning after December 15, 2020, and interim periods within annual periods beginning after December 15, 2020. The Company is evaluating this standard to determine if adoption will have a material impact on the Company’s consolidated financial statements.

In August 2018, the U.S. Securities and Exchange Commission (SEC) adopted the final rule under SEC Release No. 33-10532, Disclosure Update and Simplification. This final rule amends certain disclosure requirements that are redundant, duplicative, overlapping, outdated or superseded. In addition, the amendments expand the disclosure requirements on the analysis of stockholders' equity for interim financial statements. Under the amendments, an analysis of changes in each caption of stockholders' equity presented in the balance sheet must be provided in a note or separate statement. The analysis should present a reconciliation of the beginning balance to the ending balance of each period for which a statement of comprehensive income is required to be filed. This final rule is effective for the Company for all filings made on or after November 5, 2018. The SEC staff clarified that the first presentation of the changes in shareholders' equity may be included in the first Form 10-Q for the quarter that begins after the effective date of the amendments. The adoption of the final rule did not have a material impact on the Company’s consolidated financial statements.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses, which changes the impairment model for most financial assets and certain other financial instruments. The standard will require the use of a forward-looking “expected loss” model for instruments measured at amortized cost that generally will result in the earlier recognition of allowances for losses. The standard is effective for years beginning after December 15, 2019, and interim periods within annual periods beginning after December 15, 2019. The adoption of this standard is not expected to have a material impact on the Company's consolidated financial results.

In February 2016, the FASB issued ASU 2016-2, Leases (Topic 842), which was further clarified by ASU 2018-10, Codification Improvements to Topic 842, Leases, and ASU 2018-11, Leases - Targeted Improvements, issued in July

2018. ASC 842 supersedes existing lease guidance, including ASC 840 Leases. The new leasing standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The new leasing standard requires that lessees will need to recognize an ROU asset and a lease liability for virtually all of their leases, and allows companies to make a policy election as to whether short term leases will be recognized under the requirements of the new standard. The Company elected to exclude short-term leases in the application of the new standard. The lease liability is equal to the present value of lease payments. The ROU asset is based on the liability subject to certain adjustments. For income statement purposes, the FASB retained a dual model, requiring leases to be classified as either operating or finance. Operating leases will result in straight-line expense, similar to accounting for operating leases under ASC 840, while finance leases will result in a front-loaded expense pattern, similar to accounting for capital leases under ASC 840.

The Company adopted the new leasing standard in the first quarter of 2019, using a modified retrospective transition. There was no impact to the opening balance of retained earnings as of the effective date of January 1, 2019 as a result of adoption. Prior period financial statements were not recast. The Company elected the package of transition provisions available for expired or existing contracts, which allowed it to carryforward its historical assessments of (1) whether contracts are or contain leases, (2) lease classification and (3) initial direct costs. The adoption of the new leasing standard on January 1, 2019 resulted in the recognition of $15.8 million of operating lease liabilities, $2.2 million of which were classified as current liabilities, with corresponding ROU assets of $12.2 million, net of lease prepayments and the balance of deferred lease incentives. The Company does not have any financing leases.

Earnings per Share

Accounts Payable and Accrued Liabilities

12 Months Ended

Dec. 31, 2019

Payables and Accruals [Abstract]

Accounts Payable and Accrued Liabilities

The following is a summary of the Company’s accounts payable and accrued liabilities as of December 31, 2019 and 2018:



(in thousands)	December 31, 2019		December 31, 2018
Compensation and employee benefits	$	6,597	$	6,363
Royalties payable	5,904		5,172
Research and development expenses	5,893		5,593
Consulting and other professional fees	5,376		2,924
Operating lease liabilities	2,147		—
Other	1,673		1,532
Total accounts payable and accrued liabilities	$	27,590	$	21,584

Income Taxes

12 Months Ended

Dec. 31, 2019

Income Tax Disclosure [Abstract]

Income Taxes

The following is a summary of the domestic and foreign components of income (loss) before income taxes for the years ended December 31, 2019, 2018 and 2017:



	Year Ended December 31,
(in thousands)	2019		2018		2017
Domestic	$	28,794	$	25,123	$	(15,693	)
Foreign	234		223		262
Total income (loss) before income taxes	$	29,028	$	25,346	$	(15,431	)

The following is a summary of the provision (benefit) for income taxes for the years ended December 31, 2019, 2018 and 2017:



	Year Ended December 31,
(in thousands)	2019			2018			2017
Current:
Federal	$	—		$	—		$	—
State	1,161			53			65
Foreign	81			99			(66		)
Deferred:
Federal	(85,624		)	—			—
State	(2,127		)	—			—
Foreign	(16		)	(14		)	137
Provision (benefit) for income taxes	$	(86,525	)	$	138		$	136

The Company assesses the need for a valuation allowance against its deferred tax asset each quarter through the review of all available positive and negative evidence. Deferred tax assets are reduced by a tax valuation allowance when, in the opinion of management, it is more likely than not that some portion of the deferred tax assets will not be realized. The analysis depends on historical and projected taxable income. Projected taxable income includes significant assumptions related to revenue, commercial expenses and research and development activities. During 2019, after considering all available positive and negative evidence, including but not limited to cumulative income in recent periods, historical, current and future projected results and significant risks and uncertainties related to forecasts, the Company concluded that it was more likely than not that substantially all of its deferred tax assets in the U.S. are realizable in future periods. A valuation allowance has been retained against certain U.S. federal tax attributes with short carryforward periods and District of Columbia state deferred tax assets as of December 31, 2019. A full valuation allowance was recorded against all net U.S. deferred tax assets as of December 31, 2018.

The income tax benefit for 2019 was primarily due to the reduction of the Company's valuation allowance against substantially all of its deferred tax assets in the U.S. Tax expense associated with U.S. income before income taxes for the years ended December 31, 2019 and 2018 was offset by a corresponding tax benefit for the reduction of the valuation allowance recorded against tax attributes that were utilized in those periods. Tax benefit associated with U.S. loss before income taxes for the year ended December 31, 2017 was offset by a corresponding tax expense for the increase of the valuation allowance recorded against tax attributes that were generated in that period. The following is reconciliation between the federal statutory tax rate and the Company’s effective tax rate for the years ended December 31, 2019, 2018 and 2017:



	Year Ended December 31,
	2019		2018		2017
Federal tax at statutory rate	21.0	%	21.0	%	35.0	%
State taxes	1.8	%	1.7	%	1.7	%
U.S. Tax Cuts and Job Act (1)	—	%	—	%	(262.6	)%
Change in valuation allowance - U.S. Tax Cuts and Jobs Act	—	%	—	%	262.6	%
Other change in valuation allowance (2)	(357.6	)%	(16.4	)%	(47.8	)%
Research and development credit (3)	(10.9	)%	(9.1	)%	9.0	%
Orphan drug credit (3)	17.1	%	(2.7	)%	6.3	%
Section 162(m) limitation	2.7	%	3.1	%	8.1	%
Other tax rate changes	(0.5	)%	(0.7	)%	(2.6	)%
Other changes in state deferred taxes (4)	—	%	5.9	%	5.1	%
Uncertain tax positions (5)	26.3	%	—	%	—	%
Stock-based compensation	(1.0	)%	(3.9	)%	(13.0	)%
Other items	3.0	%	1.6	%	(2.7	)%
Effective tax rate	(298.1	)%	0.5	%	(0.9	)%


(1)	Includes the effect of the Tax Cuts and Jobs Act, which primarily relates to the remeasurement of existing deferred taxes as a result of the change to the U.S. federal tax rate.

(2)

Reductions in 2019 valuation allowances include $7.5 million related to 2019 U.S. income before income taxes, $10.7 related to adjustments for prior period credit carryforwards and uncertain tax positions and $85.6 million related to a change in beginning-of-the-year balances that resulted from a change in circumstances that caused a change in judgment about the realizability of U.S. deferred tax assets in future years. Reductions in 2018 valuation allowances are attributable to 2018 income before income taxes.


(3)	2019 activity includes adjustments to prior year credit carryforwards. As a result of the tax valuation allowance previously recorded against deferred tax assets in the U.S., these adjustments resulted in no change in tax expense.


(4)	Includes adjustments to state deferred taxes based on changes to filing jurisdictions.


(5)	2019 activity includes adjustments to prior year tax positions. As a result of the tax valuation allowance previously recorded against deferred tax assets in the U.S., these adjustments resulted in no change in tax expense.

The following is a summary of the components of the Company’s deferred tax assets (liabilities) and the related tax valuation allowance as of December 31, 2019 and 2018:



(in thousands)	December 31, 2019			December 31, 2018
Deferred tax assets:
Net operating loss carryforwards	$	52,034		$	55,742
Stock-based compensation	5,298			5,202
Accrued and deferred expenses	2,101			2,096
Allowance for returns and uncollectable receivables	1,468			1,247
Research and development and orphan drug credit carryforwards	36,041			48,066
Other	1,301			1,405
Total deferred tax assets	98,243			113,758
Deferred tax liabilities:
Intangible assets	(1,994		)	(1,247		)
Other	(414		)	(576		)
Total deferred tax liabilities	(2,408		)	(1,823		)
Deferred tax assets, net	95,835			111,935
Less: Valuation allowance	8,155			111,950
Net deferred tax assets (liabilities)	$	87,680		$	(15	)

The Company’s net deferred tax liability of less than $0.1 million as of December 31, 2018 is included as a component of other non-current liabilities.

The following is a summary of changes in the Company’s tax valuation allowance for the years ended December 31, 2019, 2018 and 2017:



(in thousands)	Balance at Beginning of Year		Additions		Reductions			Balance at End of Year
Year Ended:
December 31, 2019	$	111,950	$	—	$	(103,795	)	$	8,155
December 31, 2018	116,110		4,036		(8,196		)	111,950
December 31, 2017	146,012		12,403		(42,305		)	116,110

The Company has NOL and other tax credit carryforwards in several jurisdictions. As of December 31, 2019, the Company has $43.3 million of deferred tax assets relating to U.S. federal NOL carryforwards, along with deferred tax assets of $12.0 million and $24.0 million related to U.S. federal research and development credits and orphan drug credits, respectively. These tax attributes will begin to expire in 2031, 2024 and 2030, respectively. In addition, the Company has $8.7 million of deferred tax assets relating to U.S. state NOL carryforwards, which primarily relate to the District of Columbia. State NOLs for the District of Columbia will begin to expire in 2031 and other state NOLs will begin to expire in 2021.

Tax benefits are recognized from an uncertain tax position only if it is more likely than not that the position will be sustained on examination by the taxing authorities based on the technical merits of the position. The tax benefit recognized in the financial statements for a particular tax position is based on the largest benefit that is more likely than not to be realized upon settlement.

A reconciliation of the beginning and ending amount of gross unrecognized tax benefits is as follows:



	Year Ended December 31,
(in thousands)	2019		2018		2017
Unrecognized tax benefits at the beginning of the year	$	—	$	—	$	—
Increases related to prior year tax positions	8,223		—		—
Increases related to current year tax positions	1,518		—		—
Unrecognized tax benefits at the end of the year	$	9,741	$	—	$	—

The amount of uncertain tax benefits that, if recognized, would impact the effective tax rate is $9.7 million. No material income tax interest or penalties have been recorded, and unrecognized tax benefits are not expected to change materially over the next 12 months. Income tax returns filed by the Company for all periods are open to examination by tax jurisdictions. As of December 31, 2019, the Company is not under examination by any federal or state tax jurisdiction.

Certain tax attributes of the Company, including NOLs and credits, would be subject to a limitation should an ownership change as defined under the Internal Revenue Code of 1986, as amended (IRC), Section 382, occur. The limitations resulting from a change in ownership could affect the Company’s ability to utilize its NOLs and credit carryforward (tax attributes). Ownership changes occurred in the years ending December 31, 2014 and December 31, 2008. The Company believes that the ownership changes in 2014 and 2008 will not impact its ability to utilize NOL and credit carryforwards; however, future ownership changes may cause the Company’s existing tax attributes to have additional limitations.

The Tax Cuts and Jobs Act (TCJA) was enacted in December 2017. The TCJA reduces the U.S. federal corporate tax rate from 35% to 21%, requires companies to pay a one-time transition tax on earnings of certain foreign subsidiaries that were previously deferred and creates new taxes on certain foreign sourced earnings. During the fourth quarter of 2018, the Company completed its accounting for the tax effects of the TCJA. Effects of the TCJA resulted in no tax expense in 2018 or 2017 as they were fully offset by a change in the Company's tax valuation allowance.

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Revenues:
Net product sales	$ 227,188	$ 193,118	$ 165,083
Total revenues	227,188	193,118	165,083
Operating expenses:
Cost of goods sold excluding amortization	24,488	20,508	17,848
Research and development	48,649	43,594	38,547
Selling, general and administrative	129,736	105,751	123,841
Intangible asset amortization	1,505	1,527	1,750
Total operating expenses	204,378	171,380	181,986
Income (loss) from operations	22,810	21,738	(16,903)
Other income	6,218	3,608	1,472
Income (loss) before income taxes	29,028	25,346	(15,431)
Provision (benefit) for income taxes	(86,525)	138	136
Net income (loss)	$ 115,553	$ 25,208	$ (15,567)
Net income (loss) per share:
Basic (in dollars per share)	$ 2.17	$ 0.50	$ (0.35)
Diluted (in dollars per share)	$ 2.11	$ 0.48	$ (0.35)
Weighted average shares outstanding:
Basic (in shares)	53,137,562	50,859,947	44,735,146
Diluted (in shares)	54,847,060	53,045,257	44,735,146

Intangible Assets - Fanapt - Additional Information (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Finite-Lived Intangible Assets [Line Items]
Acquisition of intangible assets	$ 0	$ 25,000	$ 0
Fanapt®
Finite-Lived Intangible Assets [Line Items]
Intangible assets	$ 27,900	$ 27,900

Stock-Based Compensation - Summary of RSU Activity Plan (Detail) - Restricted Stock Units (RSU) - $ / shares	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Number of Shares Unvested
Beginning balance (in shares)	1,313,576	1,357,838	1,138,428
Granted (in shares)	937,328	714,086	857,336
Forfeited (in shares)	(75,444)	(229,603)	(275,613)
Vested (in shares)	(526,175)	(528,745)	(362,313)
Ending balance (in shares)	1,649,285	1,313,576	1,357,838
Weighted Average Price/Share Unvested
Beginning balance (in dollars per share)	$ 15.68	$ 12.72	$ 10.07
Granted (in dollars per share)	19.46	18.93	14.57
Forfeited (in dollars per share)	18.93	15.19	11.41
Vested (in dollars per share)	14.54	12.69	9.78
Ending balance (in dollars per share)	$ 18.04	$ 15.68	$ 12.72

Accumulated Other Comprehensive Income - Additional Information (Detail) - USD ($)	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Reclassification Out of Accumulated Other Comprehensive Income (Loss)
Accumulated Other Comprehensive Income (Loss) [Line Items]
Reclassifications out of accumulated other comprehensive income (loss)	$ 0	$ 0	$ 0

Accumulated Other Comprehensive Income

12 Months Ended

Dec. 31, 2019

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Accumulated Other Comprehensive Income

The accumulated balances related to each component of other comprehensive income (loss), net of taxes, were as follows for the years ended December 31, 2019 and 2018:



(in thousands)	December 31, 2019		December 31, 2018
Foreign currency translation	$	13	$	7
Unrealized gain (loss) on marketable securities	236		(6		)
Accumulated other comprehensive income	$	249	$	1

There were no reclassifications out of accumulated other comprehensive income (loss) for the years ended December 31, 2019, 2018 and 2017.

Intangible Assets - Summary of Amortization Expense (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Finite-Lived Intangible Assets [Line Items]
Intangible asset amortization	$ 1,505	$ 1,527	$ 1,750
HETLIOZ®
Finite-Lived Intangible Assets [Line Items]
Intangible asset amortization	$ 1,505	$ 1,527	$ 1,750

Marketable Securities (Tables)

12 Months Ended

Dec. 31, 2019

Investments, Debt and Equity Securities [Abstract]

Summary of Available-for-Sale Marketable Securities

The following is a summary of the Company’s available-for-sale marketable securities as of December 31, 2019, which all have contractual maturities of less than two years:



(in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Market Value
U.S. Treasury and government agencies	$	88,535	$	68	$	(2	)	$	88,601
Corporate debt	129,860		196		(1		)	130,055
Asset-backed securities	48,355		49		(3		)	48,401
Total marketable securities	$	266,750	$	313	$	(6	)	$	267,057

The following is a summary of the Company’s available-for-sale marketable securities as of December 31, 2018, which all have contract maturities of less than one year:



(in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Market Value
U.S. Treasury and government agencies	$	69,275	$	12	$	(17	)	$	69,270
Corporate debt	105,897		38		(25		)	105,910
Asset-backed securities	21,189		—		(14		)	21,175
Total marketable securities, current	$	196,361	$	50	$	(56	)	$	196,355

Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2019

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Use of Estimates

Cash, Cash Equivalents and Restricted Cash

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the Consolidated Balance Sheets to the total end of period cash, cash equivalents and restricted cash reported within the Consolidated Statement of Cash Flows:



	December 31,
(in thousands)	2019		2018
Cash and cash equivalents	$	45,072	$	61,005
Restricted cash included in:
Prepaid expenses and other current assets	—		157
Non-current inventory and other	578		587
Total cash, cash equivalents and restricted cash	$	45,650	$	61,749

Marketable Securities

Inventory

Intangible Assets

Property and Equipment

Leases

Accounts Payable and Accrued Liabilities

Revenue Recognition

The Company’s net product sales consist of sales of HETLIOZ^® and Fanapt^®. Net sales by product for the years ended December 31, 2019, 2018 and 2017 were as follows:



	Year Ended December 31,
(in thousands)	2019		2018		2017
HETLIOZ^® product sales, net	$	142,980	$	115,835	$	89,978
Fanapt^® product sales, net	84,208		77,283		75,105
Total net product sales	$	227,188	$	193,118	$	165,083

The following table presents each major customer that represented more than 10% of total revenues for the years ended December 31, 2019, 2018 and 2017:



	Year Ended December 31,
Percent of Net Product Sales	2019		2018		2017
Distributor A	38	%	37	%	32	%
Distributor B	23	%	17	%	10	%
Distributor C	12	%	14	%	15	%
Distributor D	12	%	12	%	15	%
Distributor E	11	%	12	%	12	%
Distributor F	—	%	5	%	11	%

The following table presents each major customer that represented more than 10% of accounts receivable, net, as of December 31, 2019 and 2018:



	December 31,
Percent of Accounts Receivable, Net	2019		2018
Distributor A	21	%	30	%
Distributor B	21	%	15	%
Distributor C	18	%	20	%
Distributor D	16	%	13	%
Distributor E	18	%	16	%



(in thousands)	Reserve for Product Returns
Balances at December 31, 2016	$	3,080
Additions	5,978
Credits/payments	(4,939		)
Balances at December 31, 2017	4,119
Additions	2,684
Credits/payments	(1,616		)
Balances at December 31, 2018	5,187
Additions	3,138
Credits/payments	(2,205		)
Balances at December 31, 2019	$	6,120

Cost of Goods Sold

Research and Development Expenses

Selling, General and Administrative Expenses

Stock-Based Compensation

Advertising Expense

Foreign Currency

Income Taxes

The Company accounts for income taxes using the asset and liability method. Under the asset and liability method, current income tax expense or benefit is the amount of income taxes expected to be payable or refundable for the current year. A deferred income tax asset or liability is recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and tax credits and loss carryforwards. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion of the deferred tax assets will not be realized. Tax rate changes are reflected in income during the period such changes are enacted. Changes in ownership may limit the amount of net operating loss (NOL) carryforwards that can be utilized in the future to offset taxable income. Tax benefits are recognized from an uncertain tax position only if it is more likely than not that the position will be sustained on examination by the taxing authorities based on the technical merits of the position. The tax benefit recognized in the financial statements for a particular tax position is based on the largest benefit that is more likely than not to be realized upon settlement.

Certain Risks and Uncertainties

The Company’s products under development require approval from the FDA or other international regulatory agencies prior to commercial sales. There can be no assurance the products will receive the necessary clearance. If the Company is denied clearance or clearance is delayed, it may have a material adverse impact on the Company.

The Company’s products are concentrated in rapidly-changing, highly-competitive markets, which are characterized by rapid technological advances, changes in customer requirements and evolving regulatory requirements and industry standards. Any failure by the Company to anticipate or to respond adequately to technological developments in its industry, changes in customer requirements or changes in regulatory requirements or industry standards or any significant delays in the development or introduction of products or services could have a material adverse effect on the Company’s business, operating results and future cash flows.

The Company depends on single source suppliers for critical raw materials for manufacturing, as well as other components required for the administration of its products. The loss of these suppliers could delay the clinical trials or prevent or delay commercialization of the products.

Concentrations of Credit Risk

Financial instruments, which potentially subject the Company to significant concentrations of credit risk, consist primarily of cash, cash equivalents and marketable securities. The Company places its cash, cash equivalents and marketable securities with highly-rated financial institutions. At December 31, 2019, the Company maintained all of its cash, cash equivalents and marketable securities in two financial institutions. Deposits held with these institutions may exceed the amount of insurance provided on such deposits. Generally, these deposits may be redeemed upon demand, and the Company believes there is minimal risk of losses on such balances.

Segment and Geographic Information

The Company operates in one reporting segment and, accordingly, no segment disclosures are presented herein. Foreign sales were not material for each of the years ended December 31, 2019, 2018 and 2017.

Recent Accounting Pronouncements

Fair Value Measurements

12 Months Ended

Dec. 31, 2019

Fair Value Disclosures [Abstract]

Fair Value Measurements

Authoritative guidance establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include:


•	Level 1 — defined as observable inputs such as quoted prices in active markets


•	Level 2 — defined as inputs other than quoted prices in active markets that are either directly or indirectly observable


•	Level 3 — defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions

Marketable securities classified in Level 1 and Level 2 as of December 31, 2019 and 2018 consist of cash equivalents and available-for-sale marketable securities. The valuation of Level 1 instruments is determined using a market approach, and is based upon unadjusted quoted prices for identical assets in active markets. The valuation of investments classified in Level 2

also is determined using a market approach based upon quoted prices for similar assets in active markets, or other inputs that are observable for substantially the full term of the financial instrument. Level 2 securities include certificates of deposit, commercial paper, corporate notes, and asset-backed securities that use as their basis readily observable market parameters.

The Company held certain assets that are required to be measured at fair value on a recurring basis as of December 31, 2019, as follows:



			Fair Value Measurement as of December 31, 2019 Using
(in thousands)	Total Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
U.S. Treasury and government agencies	$	88,601	$	88,601	$	—	$	—
Corporate debt	137,025		—		137,025		—
Asset-backed securities	48,401		—		48,401		—
Total assets measured at fair value	$	274,027	$	88,601	$	185,426	$	—

The Company held certain assets that are required to be measured at fair value on a recurring basis as of December 31, 2018, as follows:



			Fair Value Measurement as of December 31, 2018 Using
(in thousands)	Total Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
U.S. Treasury and government agencies	$	69,270	$	69,270	$	—	$	—
Corporate debt	105,910		—		105,910		—
Asset-backed securities	21,175		—		21,175		—
Total assets measured at fair value	$	196,355	$	69,270	$	127,085	$	—

Total assets measured at fair value as of December 31, 2019 include $7.0 million of cash equivalents.

The Company also has financial assets and liabilities, not required to be measured at fair value on a recurring basis, which primarily consist of cash, accounts receivable, restricted cash, accounts payable and accrued liabilities, product revenue allowances, and milestone obligations under license agreements, the carrying values of which materially approximate their fair values.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Intangible Assets - Summary of Intangible Assets (Detail) - USD ($) $ in Thousands	1 Months Ended	12 Months Ended
	Jan. 31, 2014	Dec. 31, 2019	Dec. 31, 2018
Finite-Lived Intangible Assets [Line Items]
Net Carrying Amount		$ 23,037	$ 24,542
HETLIOZ®
Finite-Lived Intangible Assets [Line Items]
Intangible assets, estimated future useful life	2034-05	2035-07	2035-02
Gross Carrying Amount		$ 33,000	$ 33,000
Accumulated Amortization		9,963	8,458
Net Carrying Amount		23,037	24,542
Fanapt®
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount		$ 27,900	$ 27,900

Summary of Significant Accounting Policies - Schedule of Major Customers that Represented More Than 10% of Accounts Receivable, Net (Detail) - Credit Concentration Risk - Accounts Receivable	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Distributor A
Concentration Risk [Line Items]
Concentration risk, percentage	21.00%	30.00%
Distributor B
Concentration Risk [Line Items]
Concentration risk, percentage	21.00%	15.00%
Distributor C
Concentration Risk [Line Items]
Concentration risk, percentage	18.00%	20.00%
Distributor D
Concentration Risk [Line Items]
Concentration risk, percentage	16.00%	13.00%
Distributor E
Concentration Risk [Line Items]
Concentration risk, percentage	18.00%	16.00%

Fair Value Measurements (Tables)

12 Months Ended

Dec. 31, 2019

Fair Value Disclosures [Abstract]

Assets Measured at Fair Value on Recurring Basis

The Company held certain assets that are required to be measured at fair value on a recurring basis as of December 31, 2019, as follows:



			Fair Value Measurement as of December 31, 2019 Using
(in thousands)	Total Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
U.S. Treasury and government agencies	$	88,601	$	88,601	$	—	$	—
Corporate debt	137,025		—		137,025		—
Asset-backed securities	48,401		—		48,401		—
Total assets measured at fair value	$	274,027	$	88,601	$	185,426	$	—

The Company held certain assets that are required to be measured at fair value on a recurring basis as of December 31, 2018, as follows:



			Fair Value Measurement as of December 31, 2018 Using
(in thousands)	Total Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
U.S. Treasury and government agencies	$	69,270	$	69,270	$	—	$	—
Corporate debt	105,910		—		105,910		—
Asset-backed securities	21,175		—		21,175		—
Total assets measured at fair value	$	196,355	$	69,270	$	127,085	$	—

Intangible Assets - HETLIOZ - Additional Information (Detail) - USD ($) $ in Thousands	1 Months Ended		12 Months Ended			191 Months Ended
	Apr. 30, 2018	Jan. 31, 2014	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2019
Finite-Lived Intangible Assets [Line Items]
Acquisition of intangible assets			$ 0	$ 25,000	$ 0
Milestone obligation under license agreement			$ 0	200		$ 0
HETLIOZ®
Finite-Lived Intangible Assets [Line Items]
Acquisition of intangible assets		$ 8,000		$ 25,000		$ 37,500
Intangible assets, estimated future useful life		2034-05	2035-07	2035-02
Cumulative worldwide sales milestone	$ 250,000
Milestone obligation under license agreement				$ 25,000

Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2019

Accounting Policies [Abstract]

Reconciliation of Cash, Cash Equivalents and Restricted Cash



	December 31,
(in thousands)	2019		2018
Cash and cash equivalents	$	45,072	$	61,005
Restricted cash included in:
Prepaid expenses and other current assets	—		157
Non-current inventory and other	578		587
Total cash, cash equivalents and restricted cash	$	45,650	$	61,749

Net Product Sales

The Company’s net product sales consist of sales of HETLIOZ^® and Fanapt^®. Net sales by product for the years ended December 31, 2019, 2018 and 2017 were as follows:



	Year Ended December 31,
(in thousands)	2019		2018		2017
HETLIOZ^® product sales, net	$	142,980	$	115,835	$	89,978
Fanapt^® product sales, net	84,208		77,283		75,105
Total net product sales	$	227,188	$	193,118	$	165,083

Schedule of Major Customers that Represented More Than 10% of Total Revenues

The following table presents each major customer that represented more than 10% of total revenues for the years ended December 31, 2019, 2018 and 2017:



	Year Ended December 31,
Percent of Net Product Sales	2019		2018		2017
Distributor A	38	%	37	%	32	%
Distributor B	23	%	17	%	10	%
Distributor C	12	%	14	%	15	%
Distributor D	12	%	12	%	15	%
Distributor E	11	%	12	%	12	%
Distributor F	—	%	5	%	11	%

Schedule of Major Customers that Represented More Than 10% of Accounts Receivable, Net

The following table presents each major customer that represented more than 10% of accounts receivable, net, as of December 31, 2019 and 2018:



	December 31,
Percent of Accounts Receivable, Net	2019		2018
Distributor A	21	%	30	%
Distributor B	21	%	15	%
Distributor C	18	%	20	%
Distributor D	16	%	13	%
Distributor E	18	%	16	%

Summary of Product Return Allowance

The following table summarizes activity for product returns as of and for the years ended December 31, 2019, 2018 and 2017, all of which relates to sales of Fanapt^®:



(in thousands)	Reserve for Product Returns
Balances at December 31, 2016	$	3,080
Additions	5,978
Credits/payments	(4,939		)
Balances at December 31, 2017	4,119
Additions	2,684
Credits/payments	(1,616		)
Balances at December 31, 2018	5,187
Additions	3,138
Credits/payments	(2,205		)
Balances at December 31, 2019	$	6,120

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-in Capital	Other Comprehensive Income (Loss)	Accumulated Deficit
Beginning balance (in shares) at Dec. 31, 2016		44,000,614
Beginning balance at Dec. 31, 2016	$ 131,330	$ 44	$ 477,087	$ 58	$ (345,859)
Issuance of common stock from the exercise of stock options and settlement of restricted stock units	5,251	$ 1	5,250
Issuance of common stock from the exercise of stock options and settlement of restricted stock units (in shares)		937,519
Stock-based compensation expense	10,465		10,465
Net income (loss)	(15,567)				(15,567)
Other comprehensive income (loss), net of tax	(92)			(92)
Ending balance (in shares) at Dec. 31, 2017		44,938,133
Ending balance at Dec. 31, 2017	131,387	$ 45	492,802	(34)	(361,426)
Net proceeds from public offering of common stock	100,870	$ 6	100,864
Net proceeds from public offering of common stock (in shares)		6,325,000
Issuance of common stock from the exercise of stock options and settlement of restricted stock units	6,256	$ 1	6,255
Issuance of common stock from the exercise of stock options and settlement of restricted stock units (in shares)		1,214,460
Stock-based compensation expense	11,666		11,666
Net income (loss)	25,208				25,208
Other comprehensive income (loss), net of tax	$ 35			35
Ending balance (in shares) at Dec. 31, 2018	52,477,593	52,477,593
Ending balance at Dec. 31, 2018	$ 275,422	$ 52	611,587	1	(336,218)
Issuance of common stock from the exercise of stock options and settlement of restricted stock units	6,264	$ 2	6,262
Issuance of common stock from the exercise of stock options and settlement of restricted stock units (in shares)		1,072,019
Stock-based compensation expense	13,458		13,458
Net income (loss)	115,553				115,553
Other comprehensive income (loss), net of tax	$ 248			248
Ending balance (in shares) at Dec. 31, 2019	53,549,612	53,549,612
Ending balance at Dec. 31, 2019	$ 410,945	$ 54	$ 631,307	$ 249	$ (220,665)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References + Details

Business Organization and Presentation (Detail)	12 Months Ended
Business Organization and Presentation (Detail)	Dec. 31, 2019 product Segment
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Number of operating segments \| Segment	1
Number of products in portfolio \| product	2

Leases (Tables)

12 Months Ended

Dec. 31, 2019

Leases [Abstract]

Schedule of Future Minimum Rental Payments for Operating Leases

The following is a summary of the Company’s ROU assets and operating lease liabilities as of December 31, 2019:



(in thousands)	Classification on the Balance Sheet	December 31, 2019
Assets
Operating lease assets	Operating lease right-of-use assets	$	11,180

Liabilities
Operating lease current liabilities	Accounts payable and accrued liabilities	$	2,147
Operating lease non-current liabilities	Operating lease non-current liabilities	12,455
Total lease liabilities		$	14,602

Weighted average remaining lease term		8.1
Weighted average discount rate⁽¹⁾		8.1		%

(1)

Upon adoption of the new lease standard, discount rates used for existing leases were established at January 1, 2019.

Lessee, Operating Lease, Liability, Maturity

The table below reconciles the Company's future cash obligations to operating lease liabilities recorded on the balance sheet as of December 31, 2019:



(in thousands)	Operating Leases
2020	$	2,326
2021	2,332
2022	2,355
2023	2,420
2024	2,488
Thereafter	8,182
Total minimum lease payments	20,103
Less: amount of lease payments representing interest	(5,501		)
Present value of future minimum lease payments	14,602
Less: current obligations under leases	(2,147		)
Operating lease non-current liabilities	$	12,455

Schedule of Lease Assets and Liabilities

At December 31, 2018, future minimum payments under noncancellable operating leases under ASC 840 were as follows:



	Cash Payments Due by Year
(in thousands)	Total		2019		2020		2021		2022		2023		Thereafter
Operating leases	$	22,757	$	2,483	$	2,495	$	2,335	$	2,355	$	2,420	$	10,669

Income Taxes - Summary of Gross Unrecognized Income Tax Benefits (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Income Tax Disclosure [Abstract]
Unrecognized tax benefits at the beginning of the year	$ 0	$ 0	$ 0
Increases related to prior year tax positions	8,223	0	0
Increases related to current year tax positions	1,518	0	0
Unrecognized tax benefits at the end of the year	$ 9,741	$ 0	$ 0

Summary of Significant Accounting Policies - Reconciliation Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Cash and Cash Equivalents [Line Items]
Cash and cash equivalents	$ 45,072	$ 61,005
Restricted cash included in:
Total cash, cash equivalents and restricted cash	45,650	61,749	$ 34,335	$ 41,256
Prepaid expenses and other current assets
Restricted cash included in:
Restricted Cash and Cash Equivalents	0	157
Non-current inventory and other
Restricted cash included in:
Restricted Cash and Cash Equivalents	$ 578	$ 587

Income Taxes - Additional Information (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Income Taxes [Line Items]
Provision (benefit) for income taxes	$ (86,525)	$ 138	$ 136
Domestic	28,794	25,123	(15,693)
Foreign	234	223	262
Income tax benefit associated with the loss before income taxes	0	0	$ 0
Net deferred tax liability		15
Net operating loss carryforwards	52,034	55,742
Deferred tax assets related to U.S. federal research and development credits	$ 12,000
Net operating loss carryforwards beginning expiration year	2031
U.S. research and development credit beginning expiration year	2024
Orphan drug credit beginning expiration year	2030
Deferred tax assets relating to U.S. state NOL carryforwards	$ 8,700
Unrecognized tax benefits that would impact effective tax rate	9,700
U.S. Federal
Income Taxes [Line Items]
Net operating loss carryforwards	43,300
Orphan Drug
Income Taxes [Line Items]
Net deferred tax assets	$ 24,000
District of Columbia
Income Taxes [Line Items]
Net operating loss carryforwards beginning expiration year	2031
Other Non-current Liabilities \| Maximum
Income Taxes [Line Items]
Net deferred tax liability		$ 100

Commitments and Contingencies - Fanapt - Additional Information (Detail)	12 Months Ended	38 Months Ended
	Dec. 31, 2019	Dec. 31, 2019
November 16,2016 through December 31,2019
Fanapt
Royalty payable percentage on net sales		3.00%
Fanapt®
Fanapt
Royalty payable percentage on net sales	6.00%
Royalty payment period	10 years

Stock-Based Compensation (Tables)

12 Months Ended

Dec. 31, 2019

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Summary of Option Activity Plan

The following is a summary of option activity for the 2006 Plan and the 2016 Plan for the years ended December 31, 2019, 2018, and 2017:



2006 and 2016 Plans (in thousands, except for share and per share amounts)	Number of Shares		Weighted Average Exercise Price at Grant Date		Weighted Average Remaining Term (Years)	Aggregate Intrinsic Value
Outstanding at December 31, 2016	5,548,336		$	11.62	5.58	$	32,453
Granted	643,000		14.44
Forfeited	(290,729	)	10.73
Expired	(605,617	)	29.87
Exercised	(575,206	)	9.13			3,140
Outstanding at December 31, 2017	4,719,784		10.03		5.63	24,421
Granted	567,500		19.22
Forfeited	(232,527	)	13.99
Exercised	(685,715	)	9.12			5,945
Outstanding at December 31, 2018	4,369,042		11.15		5.28	65,438
Granted	687,500		18.38
Forfeited	(53	)	7.94
Expired	(15,000	)	14.78
Exercised	(546,344	)	11.47			2,482
Outstanding at December 31, 2019	4,495,145		12.21		5.58	22,148
Exercisable at December 31, 2019	3,371,836		10.31		4.53	21,200
Vested and expected to vest at December 31, 2019	4,354,708		12.02		5.46	22,039

Summary of RSU Activity for 2006 Plan and 2016 Plan

The following is a summary of RSU activity for the 2006 Plan and the 2016 Plan for the years ended December 31, 2019, 2018, and 2017:



RSUs	Number of Shares		Weighted Average Grant Date Fair Value
Unvested at December 31, 2016	1,138,428		$	10.07
Granted	857,336		14.57
Forfeited	(275,613	)	11.41
Vested	(362,313	)	9.78
Unvested at December 31, 2017	1,357,838		12.72
Granted	714,086		18.93
Forfeited	(229,603	)	15.19
Vested	(528,745	)	12.69
Unvested at December 31, 2018	1,313,576		15.68
Granted	937,328		19.46
Forfeited	(75,444	)	18.93
Vested	(526,175	)	14.54
Unvested at December 31, 2019	1,649,285		18.04

Stock-Based Compensation Expense

Stock-based compensation expense recognized for the years ended December 31, 2019, 2018 and 2017 was allocated as follows:



	Year Ended December 31,
(in thousands)	2019		2018		2017
Research and development	$	3,207	$	1,290	$	1,152
Selling, general and administrative	10,251		10,376		9,313
Total stock-based compensation expense	$	13,458	$	11,666	$	10,465

Black-Scholes-Merton Option Pricing Model for Employee and Director Stock Options Granted

Assumptions used in the Black-Scholes-Merton option pricing model for employee and director stock options granted during the years ended December 31, 2019, 2018 and 2017 were as follows:



	Year Ended December 31,
	2019		2018		2017
Expected dividend yield	—	%	—	%	—	%
Weighted average expected volatility	58	%	58	%	57	%
Weighted average expected term (years)	5.95		5.90		5.89
Weighted average risk-free rate	2.26	%	2.68	%	1.97	%

Property and Equipment - Property and Equipment-at Cost (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 10,476	$ 9,636
Accumulated depreciation and amortization	(6,612)	(5,219)
Property and equipment, net	$ 3,864	4,417
Computer and other equipment
Property, Plant and Equipment [Line Items]
Estimated Useful Life (Years)	3 years
Property and equipment, gross	$ 4,398	3,642
Furniture and fixtures
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 1,491	1,488
Furniture and fixtures \| Minimum
Property, Plant and Equipment [Line Items]
Estimated Useful Life (Years)	5 years
Furniture and fixtures \| Maximum
Property, Plant and Equipment [Line Items]
Estimated Useful Life (Years)	7 years
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 4,587	$ 4,506
Leasehold improvements \| Minimum
Property, Plant and Equipment [Line Items]
Estimated Useful Life (Years)	5 years
Leasehold improvements \| Maximum
Property, Plant and Equipment [Line Items]
Estimated Useful Life (Years)	11 years

Intangible Assets - Summary of Future Intangible Asset Amortization (Detail) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Finite-Lived Intangible Assets [Line Items]
Net Carrying Amount	$ 23,037	$ 24,542
HETLIOZ®
Finite-Lived Intangible Assets [Line Items]
Net Carrying Amount	23,037	$ 24,542
2020	1,478
2021	1,478
2022	1,478
2023	1,478
2024	1,478
Thereafter	$ 15,647

Marketable Securities

12 Months Ended

Dec. 31, 2019

Investments, Debt and Equity Securities [Abstract]

Marketable Securities

The following is a summary of the Company’s available-for-sale marketable securities as of December 31, 2019, which all have contractual maturities of less than two years:



(in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Market Value
U.S. Treasury and government agencies	$	88,535	$	68	$	(2	)	$	88,601
Corporate debt	129,860		196		(1		)	130,055
Asset-backed securities	48,355		49		(3		)	48,401
Total marketable securities	$	266,750	$	313	$	(6	)	$	267,057

The following is a summary of the Company’s available-for-sale marketable securities as of December 31, 2018, which all have contract maturities of less than one year:



(in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Market Value
U.S. Treasury and government agencies	$	69,275	$	12	$	(17	)	$	69,270
Corporate debt	105,897		38		(25		)	105,910
Asset-backed securities	21,189		—		(14		)	21,175
Total marketable securities, current	$	196,361	$	50	$	(56	)	$	196,355

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2019

Income Tax Disclosure [Abstract]

Summary of the Domestic and Foreign Components of Income (loss) Before Income Taxes

The following is a summary of the domestic and foreign components of income (loss) before income taxes for the years ended December 31, 2019, 2018 and 2017:



	Year Ended December 31,
(in thousands)	2019		2018		2017
Domestic	$	28,794	$	25,123	$	(15,693	)
Foreign	234		223		262
Total income (loss) before income taxes	$	29,028	$	25,346	$	(15,431	)

Summary of Provision (Benefit) for Income Taxes

The following is a summary of the provision (benefit) for income taxes for the years ended December 31, 2019, 2018 and 2017:



	Year Ended December 31,
(in thousands)	2019			2018			2017
Current:
Federal	$	—		$	—		$	—
State	1,161			53			65
Foreign	81			99			(66		)
Deferred:
Federal	(85,624		)	—			—
State	(2,127		)	—			—
Foreign	(16		)	(14		)	137
Provision (benefit) for income taxes	$	(86,525	)	$	138		$	136

Reconciliation Between Statutory Tax Rate and Effective Tax Rate

The following is reconciliation between the federal statutory tax rate and the Company’s effective tax rate for the years ended December 31, 2019, 2018 and 2017:



	Year Ended December 31,
	2019		2018		2017
Federal tax at statutory rate	21.0	%	21.0	%	35.0	%
State taxes	1.8	%	1.7	%	1.7	%
U.S. Tax Cuts and Job Act (1)	—	%	—	%	(262.6	)%
Change in valuation allowance - U.S. Tax Cuts and Jobs Act	—	%	—	%	262.6	%
Other change in valuation allowance (2)	(357.6	)%	(16.4	)%	(47.8	)%
Research and development credit (3)	(10.9	)%	(9.1	)%	9.0	%
Orphan drug credit (3)	17.1	%	(2.7	)%	6.3	%
Section 162(m) limitation	2.7	%	3.1	%	8.1	%
Other tax rate changes	(0.5	)%	(0.7	)%	(2.6	)%
Other changes in state deferred taxes (4)	—	%	5.9	%	5.1	%
Uncertain tax positions (5)	26.3	%	—	%	—	%
Stock-based compensation	(1.0	)%	(3.9	)%	(13.0	)%
Other items	3.0	%	1.6	%	(2.7	)%
Effective tax rate	(298.1	)%	0.5	%	(0.9	)%


(1)	Includes the effect of the Tax Cuts and Jobs Act, which primarily relates to the remeasurement of existing deferred taxes as a result of the change to the U.S. federal tax rate.

(2)


(3)	2019 activity includes adjustments to prior year credit carryforwards. As a result of the tax valuation allowance previously recorded against deferred tax assets in the U.S., these adjustments resulted in no change in tax expense.


(4)	Includes adjustments to state deferred taxes based on changes to filing jurisdictions.

(5)

2019 activity includes adjustments to prior year tax positions. As a result of the tax valuation allowance previously recorded against deferred tax assets in the U.S., these adjustments resulted in no change in tax expense.

Components of Deferred Tax Assets, Net, and Related Valuation Allowance

The following is a summary of the components of the Company’s deferred tax assets (liabilities) and the related tax valuation allowance as of December 31, 2019 and 2018:



(in thousands)	December 31, 2019			December 31, 2018
Deferred tax assets:
Net operating loss carryforwards	$	52,034		$	55,742
Stock-based compensation	5,298			5,202
Accrued and deferred expenses	2,101			2,096
Allowance for returns and uncollectable receivables	1,468			1,247
Research and development and orphan drug credit carryforwards	36,041			48,066
Other	1,301			1,405
Total deferred tax assets	98,243			113,758
Deferred tax liabilities:
Intangible assets	(1,994		)	(1,247		)
Other	(414		)	(576		)
Total deferred tax liabilities	(2,408		)	(1,823		)
Deferred tax assets, net	95,835			111,935
Less: Valuation allowance	8,155			111,950
Net deferred tax assets (liabilities)	$	87,680		$	(15	)

Summary of Changes in Tax Valuation Allowance

The following is a summary of changes in the Company’s tax valuation allowance for the years ended December 31, 2019, 2018 and 2017:



(in thousands)	Balance at Beginning of Year		Additions		Reductions			Balance at End of Year
Year Ended:
December 31, 2019	$	111,950	$	—	$	(103,795	)	$	8,155
December 31, 2018	116,110		4,036		(8,196		)	111,950
December 31, 2017	146,012		12,403		(42,305		)	116,110

Reconciliation of Gross Unrecognized Tax Benefits

A reconciliation of the beginning and ending amount of gross unrecognized tax benefits is as follows:



	Year Ended December 31,
(in thousands)	2019		2018		2017
Unrecognized tax benefits at the beginning of the year	$	—	$	—	$	—
Increases related to prior year tax positions	8,223		—		—
Increases related to current year tax positions	1,518		—		—
Unrecognized tax benefits at the end of the year	$	9,741	$	—	$	—

Public Offering of Common Stock (Details) - USD ($) $ / shares in Units, $ in Thousands	1 Months Ended	12 Months Ended
	Mar. 31, 2018	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Subsidiary, Sale of Stock [Line Items]
Net proceeds from public offering		$ 0	$ 100,870	$ 0
Public Offering
Subsidiary, Sale of Stock [Line Items]
Public offering of common stock (in shares)	6,325,000
Public offering of common stock (in dollars per shares)	$ 17.00
Net proceeds from public offering	$ 100,900
Over-Allotment Option
Subsidiary, Sale of Stock [Line Items]
Public offering of common stock (in shares)	825,000

Commitments and Contingencies - HETLIOZ - Additional Information (Detail) - USD ($) $ in Thousands	1 Months Ended	12 Months Ended			191 Months Ended
	Jan. 31, 2014	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2019
HETLIOZ
Acquisition of intangible assets		$ 0	$ 25,000	$ 0
Percentage of future sublicense fees payable to third-party		mid-twenties
HETLIOZ®
HETLIOZ
Acquisition of intangible assets	$ 8,000		$ 25,000		$ 37,500
Intangible assets capitalized					$ 33,000
Royalty payable percentage on net sales		10.00%
Royalty payment period		10 years

Inventory (Tables)

12 Months Ended

Dec. 31, 2019

Inventory Disclosure [Abstract]

Inventory

Inventory consisted of the following as of December 31, 2019 and 2018:



(in thousands)	December 31, 2019		December 31, 2018
Current assets
Work-in-process	$	—	$	48
Finished goods	1,140		946
Total inventory, current	$	1,140	$	994
Non-Current assets
Raw materials	$	659	$	86
Work-in-process	1,109		2,290
Finished goods	1,056		516
Total inventory, non-current	$	2,824	$	2,892

Inventory

12 Months Ended

Dec. 31, 2019

Inventory Disclosure [Abstract]

Inventory

The Company evaluates expiry risk by evaluating current and future product demand relative to product shelf life. The Company builds demand forecasts by considering factors such as, but not limited to, overall market potential, market share, market acceptance and patient usage. Inventory levels are evaluated for the amount of inventory that would be sold within one year. At certain times, the level of inventory can exceed the forecasted level of cost of goods sold for the next twelve months. The Company classifies the estimate of such inventory as non-current. Inventory consisted of the following as of December 31, 2019 and 2018:



(in thousands)	December 31, 2019		December 31, 2018
Current assets
Work-in-process	$	—	$	48
Finished goods	1,140		946
Total inventory, current	$	1,140	$	994
Non-Current assets
Raw materials	$	659	$	86
Work-in-process	1,109		2,290
Finished goods	1,056		516
Total inventory, non-current	$	2,824	$	2,892

Summary of Significant Accounting Policies - Net Sales by Product (Detail) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Revenue from External Customer [Line Items]
Net product sales	$ 227,188	$ 193,118	$ 165,083
HETLIOZ®
Revenue from External Customer [Line Items]
Net product sales	142,980	115,835	89,978
Fanapt®
Revenue from External Customer [Line Items]
Net product sales	$ 84,208	$ 77,283	$ 75,105

Stock-Based Compensation - Summary of Option Activity for 2006 Plan and the 2016 Plan (Detail) - 2006 Plan and 2016 Plan - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Number of Shares
Beginning balance (in shares)	4,369,042	4,719,784	5,548,336
Granted (in shares)	687,500	567,500	643,000
Forfeited (in shares)	(53)	(232,527)	(290,729)
Expired (in shares)	(15,000)		(605,617)
Exercised (in shares)	(546,344)	(685,715)	(575,206)
Ending balance (in shares)	4,495,145	4,369,042	4,719,784	5,548,336
Exercisable (in shares)	3,371,836
Vested and expected to vest at end of period (in shares)	4,354,708
Weighted Average Exercise Price at Grant Date
Beginning balance (in dollars per share)	$ 11.15	$ 10.03	$ 11.62
Granted (in dollars per share)	18.38	19.22	14.44
Forfeited (in dollars per share)	7.94	13.99	10.73
Expired (in dollars per share)	14.78		29.87
Exercised (in dollars per share)	11.47	9.12	9.13
Ending balance (in dollars per share)	12.21	$ 11.15	$ 10.03	$ 11.62
Exercisable (in dollars per share)	10.31
Vested and expected to vest at end of period (in dollars per share)	$ 12.02
Weighted Average Remaining Term (Years)
Weighted Average Remaining Term	5 years 6 months 29 days	5 years 3 months 10 days	5 years 7 months 17 days	5 years 6 months 29 days
Exercisable	4 years 6 months 10 days
Vested and expected to vest at end of period	5 years 5 months 15 days
Aggregate Intrinsic Value
Beginning balance	$ 65,438	$ 24,421	$ 32,453
Exercised	2,482	5,945	3,140
Ending balance	22,148	$ 65,438	$ 24,421	$ 32,453
Exercisable	21,200
Vested and expected to vest at end of period	$ 22,039

Stock-Based Compensation - Additional Information (Detail)	12 Months Ended
	Dec. 31, 2019 shares
2006 Plan and 2016 Plan \| Outstanding options and RSUs granted (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares subject to outstanding options and RSUs (in shares)	6,144,430
2016 Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares of common stock reserved for issuance (in shares)	7,100,000
Number of shares of common stock available for future grant (in shares)	3,026,147

Fair Value Measurements - Assets Measured at Fair Value on Recurring Basis (Detail) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2018
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets measured at fair value	$ 274,027	$ 196,355
U.S. Treasury and government agencies
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets measured at fair value	88,601	69,270
Corporate debt
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets measured at fair value	137,025	105,910
Asset-backed securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets measured at fair value	48,401	21,175
Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets measured at fair value	88,601	69,270
Quoted Prices in Active Markets for Identical Assets (Level 1) \| U.S. Treasury and government agencies
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets measured at fair value	88,601	69,270
Quoted Prices in Active Markets for Identical Assets (Level 1) \| Corporate debt
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets measured at fair value	0	0
Quoted Prices in Active Markets for Identical Assets (Level 1) \| Asset-backed securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets measured at fair value	0	0
Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets measured at fair value	185,426	127,085
Significant Other Observable Inputs (Level 2) \| U.S. Treasury and government agencies
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets measured at fair value	0	0
Significant Other Observable Inputs (Level 2) \| Corporate debt
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets measured at fair value	137,025	105,910
Significant Other Observable Inputs (Level 2) \| Asset-backed securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets measured at fair value	48,401	21,175
Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets measured at fair value	0	0
Significant Unobservable Inputs (Level 3) \| U.S. Treasury and government agencies
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets measured at fair value	0	0
Significant Unobservable Inputs (Level 3) \| Corporate debt
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets measured at fair value	0	0
Significant Unobservable Inputs (Level 3) \| Asset-backed securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets measured at fair value	0	$ 0
Cash Equivalents
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets measured at fair value	$ 7,000