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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Ariad Pharmaceuticals, Inc. | NASDAQ:ARIA | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 23.99 | 23.80 | 22.88 | 0 | 01:00:00 |
|
|
|
|
Delaware
|
|
22-3106987
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(State or other jurisdiction of
incorporation or organization)
|
|
(I.R.S. Employer
Identification No.)
|
|
|
|
26 Landsdowne Street, Cambridge, Massachusetts
|
|
02139-4234
|
(Address of principal executive offices)
|
|
(Zip Code)
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Large accelerated filer
|
|
ý
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Accelerated filer
|
|
¨
|
|
|
|
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|||
Non-accelerated filer
|
|
¨
(Do not check if a smaller reporting company)
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Smaller reporting company
|
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¨
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|
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PART I.
|
|
||
Item 1:
|
|
||
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||
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Item 2:
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Item 3:
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Item 4:
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PART II.
|
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Item 1:
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Item 1A:
|
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Item 6:
|
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||
|
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||
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||
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September 30,
|
|
December 31,
|
||||
In thousands, except share and per share data
|
2016
|
|
2015
|
||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
305,038
|
|
|
$
|
230,888
|
|
Marketable securities
|
9,627
|
|
|
11,407
|
|
||
Accounts receivable, net
|
23,975
|
|
|
15,686
|
|
||
Inventory, net (Note 5)
|
2,061
|
|
|
1,096
|
|
||
Other current assets
|
10,538
|
|
|
16,120
|
|
||
Total current assets
|
351,239
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|
|
275,197
|
|
||
Restricted cash
|
10,874
|
|
|
11,308
|
|
||
Property and equipment, net (Note 6)
|
308,966
|
|
|
254,082
|
|
||
Intangible and other assets, net (Note 7)
|
5,512
|
|
|
6,105
|
|
||
Total assets
|
$
|
676,591
|
|
|
$
|
546,692
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
9,260
|
|
|
$
|
17,013
|
|
Current portion of long-term debt
|
30,014
|
|
|
13,872
|
|
||
Accrued compensation and benefits
|
11,845
|
|
|
25,331
|
|
||
Accrued product development expenses
|
18,953
|
|
|
22,132
|
|
||
Other accrued expenses
|
21,533
|
|
|
22,849
|
|
||
Current portion of deferred revenue
|
10,890
|
|
|
6,763
|
|
||
Other current liabilities (Note 8)
|
8,348
|
|
|
24,324
|
|
||
Total current liabilities
|
110,843
|
|
|
132,284
|
|
||
Long-term debt (Note 9)
|
522,905
|
|
|
429,220
|
|
||
Other long-term liabilities
|
—
|
|
|
11,244
|
|
||
Deferred revenue
|
89,192
|
|
|
77,085
|
|
||
Total liabilities
|
722,940
|
|
|
649,833
|
|
||
Commitments (Note 10)
|
|
|
|
||||
Stockholders’ equity (deficit):
|
|
|
|
||||
Preferred stock, $.01 par value, authorized 10,000,000 shares, none issued and outstanding
|
—
|
|
|
—
|
|
||
Common stock, $.001 par value, authorized 450,000,000 shares; issued and outstanding 194,091,892 shares in 2016 and 189,662,148 shares in 2015
|
194
|
|
|
190
|
|
||
Additional paid-in capital
|
1,365,933
|
|
|
1,338,585
|
|
||
Accumulated other comprehensive (loss) income
|
5,041
|
|
|
3,835
|
|
||
Accumulated deficit
|
(1,417,517
|
)
|
|
(1,445,751
|
)
|
||
Total stockholders’ equity (deficit)
|
(46,349
|
)
|
|
(103,141
|
)
|
||
Total liabilities and stockholders’ equity (deficit)
|
$
|
676,591
|
|
|
$
|
546,692
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
In thousands, except per share data
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
||||||||
Product revenue, net
|
$
|
34,300
|
|
|
$
|
27,543
|
|
|
$
|
133,260
|
|
|
$
|
79,262
|
|
License, collaboration and other revenue
|
11,716
|
|
|
1,527
|
|
|
16,479
|
|
|
3,038
|
|
||||
Total revenue
|
46,016
|
|
|
29,070
|
|
|
149,739
|
|
|
82,300
|
|
||||
Operating expenses:
|
|
|
|
|
|
|
|
||||||||
Cost of product revenue
|
1,131
|
|
|
483
|
|
|
2,725
|
|
|
1,666
|
|
||||
Research and development expense
|
43,626
|
|
|
48,219
|
|
|
130,569
|
|
|
126,401
|
|
||||
Selling, general and administrative expense
|
26,249
|
|
|
36,744
|
|
|
96,468
|
|
|
118,916
|
|
||||
Transaction costs (Note 3)
|
—
|
|
|
—
|
|
|
1,482
|
|
|
—
|
|
||||
Restructuring charges (Note 16)
|
—
|
|
|
—
|
|
|
3,010
|
|
|
—
|
|
||||
Total operating expenses
|
71,006
|
|
|
85,446
|
|
|
234,254
|
|
|
246,983
|
|
||||
Loss from operations
|
(24,990
|
)
|
|
(56,376
|
)
|
|
(84,515
|
)
|
|
(164,683
|
)
|
||||
Other income (expense), net:
|
|
|
|
|
|
|
|
||||||||
Interest income
|
204
|
|
|
20
|
|
|
259
|
|
|
61
|
|
||||
Interest expense
|
(8,420
|
)
|
|
(5,228
|
)
|
|
(18,768
|
)
|
|
(12,897
|
)
|
||||
Other income, net (Note 3)
|
3,042
|
|
|
—
|
|
|
131,706
|
|
|
—
|
|
||||
Foreign exchange gain (loss)
|
3
|
|
|
291
|
|
|
(776
|
)
|
|
906
|
|
||||
Other (expense) income, net
|
(5,171
|
)
|
|
(4,917
|
)
|
|
112,421
|
|
|
(11,930
|
)
|
||||
(Loss) income before provision for income taxes
|
(30,161
|
)
|
|
(61,293
|
)
|
|
27,906
|
|
|
(176,613
|
)
|
||||
Benefit from income taxes
|
(2,334
|
)
|
|
(5,842
|
)
|
|
(328
|
)
|
|
(5,328
|
)
|
||||
Net (loss) income
|
$
|
(27,827
|
)
|
|
$
|
(55,451
|
)
|
|
$
|
28,234
|
|
|
$
|
(171,285
|
)
|
Net (loss) income per share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
(0.14
|
)
|
|
$
|
(0.29
|
)
|
|
$
|
0.15
|
|
|
$
|
(0.91
|
)
|
Diluted
|
$
|
(0.14
|
)
|
|
$
|
(0.29
|
)
|
|
$
|
0.14
|
|
|
$
|
(0.91
|
)
|
Shares used in net income (loss) per share calculations:
|
|
|
|
|
|
|
|
||||||||
Basic
|
193,225
|
|
|
188,921
|
|
|
191,677
|
|
|
188,456
|
|
||||
Diluted
|
193,225
|
|
|
188,921
|
|
|
195,079
|
|
|
188,456
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended
September 30, |
||||||||||||
In thousands
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Net (loss) income
|
$
|
(27,827
|
)
|
|
$
|
(55,451
|
)
|
|
$
|
28,234
|
|
|
$
|
(171,285
|
)
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
||||||||
Net unrealized (loss) gain on marketable securities
|
4,129
|
|
|
9,052
|
|
|
(1,780
|
)
|
|
9,052
|
|
||||
Cumulative translation adjustment, net of tax of $0
|
—
|
|
|
(327
|
)
|
|
(44
|
)
|
|
(168
|
)
|
||||
Defined benefit pension obligation, net of tax of $0
|
—
|
|
|
82
|
|
|
91
|
|
|
(336
|
)
|
||||
Reclassification of cumulative translation adjustment and pension obligation adjustments to earnings upon sale of European operations
|
—
|
|
|
—
|
|
|
2,939
|
|
|
—
|
|
||||
Other comprehensive income (loss)
|
4,129
|
|
|
8,807
|
|
|
1,206
|
|
|
8,548
|
|
||||
Comprehensive income (loss)
|
$
|
(23,698
|
)
|
|
$
|
(46,644
|
)
|
|
$
|
29,440
|
|
|
$
|
(162,737
|
)
|
|
Nine Months Ended
September 30, |
||||||
In thousands
|
2016
|
|
2015
|
||||
Cash flows from operating activities:
|
|
|
|
||||
Net Income (Loss)
|
$
|
28,234
|
|
|
$
|
(171,285
|
)
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
||||
Depreciation, amortization and impairment charges
|
11,617
|
|
|
9,019
|
|
||
Stock-based compensation
|
14,659
|
|
|
29,009
|
|
||
Repayment of interest related to facility lease obligation
|
(5,338
|
)
|
|
—
|
|
||
Reclassification of elements of accumulated other comprehensive income (loss) to earnings upon sale of sale of European operations
|
2,939
|
|
|
—
|
|
||
Gain on the Incyte transaction
|
(131,734
|
)
|
|
—
|
|
||
Deferred income tax benefit
|
—
|
|
|
(6,086
|
)
|
||
Increase (decrease) from:
|
|
|
|
||||
Accounts receivable
|
(17,317
|
)
|
|
(7,078
|
)
|
||
Inventory
|
(2,279
|
)
|
|
(539
|
)
|
||
Other current assets
|
1,917
|
|
|
10,021
|
|
||
Other assets
|
1,327
|
|
|
(1,301
|
)
|
||
Accounts payable
|
(5,778
|
)
|
|
(2,161
|
)
|
||
Accrued compensation and benefits
|
(7,576
|
)
|
|
(3,224
|
)
|
||
Accrued product development expenses
|
(3,179
|
)
|
|
8,016
|
|
||
Other accrued expenses
|
10,113
|
|
|
7,041
|
|
||
Other liabilities
|
(22,466
|
)
|
|
5,350
|
|
||
Deferred revenue
|
3,425
|
|
|
2,560
|
|
||
Net cash used in operating activities
|
(121,436
|
)
|
|
(120,658
|
)
|
||
Cash flows from investing activities:
|
|
|
|
||||
Investment in property and equipment
|
(39,572
|
)
|
|
(4,446
|
)
|
||
Proceeds from the Incyte transaction, net of $4,484 of cash transferred
|
143,149
|
|
|
—
|
|
||
Net cash provided by (used in) investing activities
|
103,577
|
|
|
(4,446
|
)
|
||
Cash flows from financing activities:
|
|
|
|
||||
Repayment of long-term debt
|
(4,813
|
)
|
|
(313
|
)
|
||
Reimbursements of amounts related to facility lease obligation
|
34,173
|
|
|
1,816
|
|
||
Proceeds from royalty financing
|
50,000
|
|
|
50,000
|
|
||
Proceeds from issuance of common stock pursuant to stock option and purchase plans
|
14,234
|
|
|
3,596
|
|
||
Payment of tax withholding obligations related to stock compensation
|
(1,541
|
)
|
|
(321
|
)
|
||
Net cash provided by financing activities
|
92,053
|
|
|
54,778
|
|
||
Effect of exchange rates on cash
|
(44
|
)
|
|
(175
|
)
|
||
Net increase (decrease) in cash and cash equivalents
|
74,150
|
|
|
(70,501
|
)
|
||
Cash and cash equivalents, beginning of period
|
230,888
|
|
|
352,688
|
|
||
Cash and cash equivalents, end of period
|
$
|
305,038
|
|
|
$
|
282,187
|
|
Supplemental disclosures:
|
|
|
|
||||
Capitalization of construction-in-progress related to facility lease obligation
|
$
|
10,254
|
|
|
$
|
26,634
|
|
Non-cash transaction – property and equipment included in accounts payable or accruals
|
$
|
3,430
|
|
|
$
|
1,106
|
|
Non-cash transaction - deferred financing costs included in accounts payable or accruals
|
$
|
—
|
|
|
$
|
3,846
|
|
Non-cash transaction – sublease tenant improvements related to facility lease obligation
|
$
|
12,379
|
|
|
$
|
—
|
|
Non-cash transaction – marketable equity securities recorded at fair market value
|
$
|
(1,780
|
)
|
|
$
|
15,138
|
|
In thousands
|
Trade
Allowances
|
|
Rebates,
Chargebacks
and
Discounts
|
|
Other
Incentives/
Returns
|
|
Total
|
||||||||
Balance, January 1, 2016
|
$
|
111
|
|
|
$
|
4,460
|
|
|
$
|
551
|
|
|
$
|
5,122
|
|
Provision
|
375
|
|
|
6,036
|
|
|
363
|
|
|
6,774
|
|
||||
Payments or credits
|
(331
|
)
|
|
(4,936
|
)
|
|
(250
|
)
|
|
(5,517
|
)
|
||||
Balance, March 31, 2016
|
155
|
|
|
5,560
|
|
|
664
|
|
|
6,379
|
|
||||
Provision
|
457
|
|
|
12,147
|
|
|
(270
|
)
|
|
12,334
|
|
||||
Payments or credits
|
(464
|
)
|
|
(6,071
|
)
|
|
(94
|
)
|
|
(6,629
|
)
|
||||
Adjustments
|
—
|
|
|
(4,684
|
)
|
|
(55
|
)
|
|
(4,739
|
)
|
||||
Balance, June 30, 2016
|
$
|
148
|
|
|
$
|
6,952
|
|
|
$
|
245
|
|
|
$
|
7,345
|
|
Provision
|
441
|
|
|
7,206
|
|
|
116
|
|
|
7,763
|
|
||||
Payments or credits
|
(432
|
)
|
|
(5,599
|
)
|
|
(117
|
)
|
|
(6,148
|
)
|
||||
Balance, September 30, 2016
|
$
|
157
|
|
|
$
|
8,559
|
|
|
$
|
244
|
|
|
$
|
8,960
|
|
In thousands
|
2016
|
|
2015
|
||||
Raw materials
|
$
|
482
|
|
|
$
|
813
|
|
Work-in-process
|
1,290
|
|
|
89
|
|
||
Finished goods
|
1,435
|
|
|
1,007
|
|
||
Total
|
3,207
|
|
|
1,909
|
|
||
Current portion
|
(2,061
|
)
|
|
(1,096
|
)
|
||
Non-current portion included in intangible and other assets, net
|
$
|
1,146
|
|
|
$
|
813
|
|
In thousands
|
2016
|
|
2015
|
||||
Building
|
$
|
103,204
|
|
|
$
|
—
|
|
Leasehold improvements
|
37,163
|
|
|
23,609
|
|
||
Construction in progress
|
182,742
|
|
|
246,669
|
|
||
Equipment and furniture
|
32,147
|
|
|
26,388
|
|
||
|
355,256
|
|
|
296,666
|
|
||
Less accumulated depreciation and amortization
|
(46,290
|
)
|
|
(42,584
|
)
|
||
Property and Equipment, Net
|
$
|
308,966
|
|
|
$
|
254,082
|
|
In thousands
|
2016
|
|
2015
|
||||
Capitalized patent and license costs
|
$
|
5,975
|
|
|
$
|
5,975
|
|
Less accumulated amortization
|
(5,128
|
)
|
|
(5,076
|
)
|
||
|
847
|
|
|
899
|
|
||
Inventory, non-current
|
1,146
|
|
|
813
|
|
||
Other assets
|
3,519
|
|
|
4,393
|
|
||
Intangible and Other Assets, Net
|
$
|
5,512
|
|
|
$
|
6,105
|
|
In thousands
|
2016
|
|
2015
|
||||
Advanced payments from customers
|
$
|
4,532
|
|
|
$
|
23,545
|
|
Other
|
3,816
|
|
|
779
|
|
||
Total
|
$
|
8,348
|
|
|
$
|
24,324
|
|
In thousands
|
2016
|
|
2015
|
||||
Convertible notes, net
|
$
|
171,188
|
|
|
$
|
164,438
|
|
Royalty financing, net
|
96,812
|
|
|
46,921
|
|
||
Facility lease obligation
|
284,919
|
|
|
231,733
|
|
||
|
552,919
|
|
|
443,092
|
|
||
Less current portion
|
(30,014
|
)
|
|
(13,872
|
)
|
||
Long term portion
|
$
|
522,905
|
|
|
$
|
429,220
|
|
•
|
during any calendar quarter commencing after the calendar quarter ending on December 31, 2014 (and only during such calendar quarter), if the last reported sale price of our common stock for at least
20
trading days (whether or not consecutive) during a period of
30
consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to
130 percent
of the conversion price, or approximately
$12.00
per share, on each applicable trading day;
|
•
|
during the
five
business day period after any
five
consecutive trading day period, or the measurement period, in which the trading price per $1,000 principal amount of the convertible notes for each trading day of the measurement period was less than
98 percent
of the product of the last reported sale price of the Company’s common stock and the conversion rate on each such trading day; or
|
•
|
upon the occurrence of specified corporate events.
|
In thousands
|
2016
|
|
2015
|
||||
Liability component:
|
|
|
|
||||
Principal
|
$
|
200,000
|
|
|
$
|
200,000
|
|
Less: debt discount and unamortized debt issuance costs
|
(28,812
|
)
|
|
(35,562
|
)
|
||
Net carrying amount
|
$
|
171,188
|
|
|
$
|
164,438
|
|
Equity component
|
$
|
40,896
|
|
|
$
|
40,896
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
In thousands
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Contractual interest expense
|
$
|
1,812
|
|
|
$
|
1,813
|
|
|
$
|
5,438
|
|
|
$
|
5,438
|
|
Amortization of debt discount
|
2,264
|
|
|
2,058
|
|
|
6,634
|
|
|
6,032
|
|
||||
Amortization of debt issuance cost
|
41
|
|
|
36
|
|
|
116
|
|
|
105
|
|
||||
Total interest expense
|
$
|
4,117
|
|
|
$
|
3,907
|
|
|
$
|
12,188
|
|
|
$
|
11,575
|
|
|
|
|
|
|
Additional
|
|
Accumulated
Other
|
|
|
|
|
|||||||||||
|
Common Stock
|
|
Paid-in
|
|
Comprehensive
|
|
Accumulated
|
|
Stockholders’
|
|||||||||||||
In thousands, except share data
|
Shares
|
|
Amount
|
|
Capital
|
|
Income (Loss)
|
|
Deficit
|
|
Equity
|
|||||||||||
Balance, January 1, 2016
|
189,662,148
|
|
|
$
|
190
|
|
|
$
|
1,338,585
|
|
|
$
|
3,835
|
|
|
$
|
(1,445,751
|
)
|
|
$
|
(103,141
|
)
|
Issuance of shares pursuant to ARIAD stock plans
|
4,429,744
|
|
|
4
|
|
|
14,230
|
|
|
—
|
|
|
—
|
|
|
14,234
|
|
|||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
14,659
|
|
|
—
|
|
|
—
|
|
|
14,659
|
|
|||||
Payments of tax withholding obligations related to stock compensation
|
—
|
|
|
—
|
|
|
(1,541
|
)
|
|
—
|
|
|
—
|
|
|
(1,541
|
)
|
|||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,733
|
)
|
|
—
|
|
|
(1,733
|
)
|
|||||
Reclassification into earnings upon sale of European operations
|
—
|
|
|
—
|
|
|
—
|
|
|
2,939
|
|
|
|
|
2,939
|
|
||||||
Net Income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
28,234
|
|
|
28,234
|
|
|||||
Balance, September 30, 2016
|
194,091,892
|
|
|
$
|
194
|
|
|
$
|
1,365,933
|
|
|
$
|
5,041
|
|
|
$
|
(1,417,517
|
)
|
|
$
|
(46,349
|
)
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
In thousands
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Compensation cost from:
|
|
|
|
|
|
|
|
||||||||
Stock options
|
$
|
2,459
|
|
|
$
|
3,348
|
|
|
$
|
7,813
|
|
|
$
|
11,718
|
|
Stock and stock units
|
2,713
|
|
|
6,396
|
|
|
6,471
|
|
|
16,858
|
|
||||
Purchases of common stock at a discount
|
110
|
|
|
187
|
|
|
375
|
|
|
433
|
|
||||
|
$
|
5,282
|
|
|
$
|
9,931
|
|
|
$
|
14,659
|
|
|
$
|
29,009
|
|
Compensation cost included in:
|
|
|
|
|
|
|
|
||||||||
Research and development expense
|
$
|
2,329
|
|
|
$
|
3,633
|
|
|
$
|
6,807
|
|
|
$
|
11,629
|
|
Selling, general and administrative expense
|
2,953
|
|
|
6,298
|
|
|
7,852
|
|
|
17,380
|
|
||||
|
$
|
5,282
|
|
|
$
|
9,931
|
|
|
$
|
14,659
|
|
|
$
|
29,009
|
|
|
Number of
Shares
|
|
Weighted
Average
Exercise Price
Per Share
|
|||
Options outstanding, January 1, 2016
|
10,232,969
|
|
|
$
|
10.00
|
|
Granted
|
4,926,825
|
|
|
$
|
6.49
|
|
Forfeited
|
(3,203,040
|
)
|
|
$
|
11.38
|
|
Exercised
|
(2,347,046
|
)
|
|
$
|
5.32
|
|
Options outstanding, September 30, 2016
|
9,609,708
|
|
|
$
|
8.88
|
|
|
Number of
Shares
|
|
Weighted
Average
Grant Date
Fair Value
|
|||
Outstanding, January 1, 2016
|
4,493,054
|
|
|
$
|
8.64
|
|
Granted / awarded
|
3,708,892
|
|
|
$
|
6.64
|
|
Forfeited
|
(2,767,526
|
)
|
|
$
|
7.58
|
|
Vested or restrictions lapsed
|
(1,986,124
|
)
|
|
$
|
8.66
|
|
Outstanding, September 30, 2016
|
3,448,296
|
|
|
$
|
7.34
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
In thousands, except per share amounts
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Net (loss) income
|
$
|
(27,827
|
)
|
|
$
|
(55,451
|
)
|
|
$
|
28,234
|
|
|
$
|
(171,285
|
)
|
|
|
|
|
|
|
|
|
||||||||
Shares used in basic computation
|
193,225
|
|
|
188,921
|
|
|
191,677
|
|
|
188,456
|
|
||||
Dilutive impact of employee equity award plans
|
—
|
|
|
—
|
|
|
2,874
|
|
|
—
|
|
||||
Dilutive impact of convertible debt
|
—
|
|
|
—
|
|
|
528
|
|
|
—
|
|
||||
Shares used in diluted computation
|
193,225
|
|
|
188,921
|
|
|
195,079
|
|
|
188,456
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Net income per Share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
(0.14
|
)
|
|
$
|
(0.29
|
)
|
|
$
|
0.15
|
|
|
$
|
(0.91
|
)
|
Diluted
|
$
|
(0.14
|
)
|
|
$
|
(0.29
|
)
|
|
$
|
0.14
|
|
|
$
|
(0.91
|
)
|
In thousands
|
Unrealized
Gains
on
Marketable
Securities, net of tax
|
|
Cumulative
Translation
Adjustment
|
|
Defined
Benefit
Pension
Obligation
|
|
Total
|
||||||||
Balance, July 1, 2016
|
$
|
912
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
912
|
|
Other comprehensive (loss) income
|
4,129
|
|
|
—
|
|
|
—
|
|
|
4,129
|
|
||||
Reclassification into earnings upon sale of European operations
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Balance, September 30, 2016
|
$
|
5,041
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
5,041
|
|
|
|
|
|
|
|
|
|
||||||||
In thousands
|
Unrealized
Gains
on
Marketable
Securities, net of tax
|
|
Cumulative
Translation
Adjustment
|
|
Defined
Benefit
Pension
Obligation
|
|
Total
|
||||||||
Balance, January 1, 2016
|
$
|
6,821
|
|
|
$
|
567
|
|
|
$
|
(3,553
|
)
|
|
$
|
3,835
|
|
Other comprehensive (loss) income
|
(1,780
|
)
|
|
(44
|
)
|
|
91
|
|
|
(1,733
|
)
|
||||
Reclassification into earnings upon sale of European operations
|
—
|
|
|
(523
|
)
|
|
3,462
|
|
|
2,939
|
|
||||
Balance, September 30, 2016
|
$
|
5,041
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
5,041
|
|
In thousands
|
September 30, 2016
|
||
Balance, January 1, 2016
|
$
|
—
|
|
Charges
|
3,010
|
|
|
Amounts paid
|
(2,124
|
)
|
|
Adjustments, net
|
(861
|
)
|
|
Balance, September 30, 2016
|
$
|
25
|
|
ITEM 2.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
•
|
Iclusig
®
(ponatinib)
is our first approved cancer medicine, which we and our collaborators are commercializing in the United States, Europe and other territories for the treatment of certain patients with rare forms of leukemia. We are also continuing to develop ponatinib, including in our ongoing OPTIC dose-ranging trial and our OPTIC-2L trial in second-line patients with chronic phase chronic myeloid leukemia, or CML.
|
•
|
Brigatinib (previously known as AP26113)
is our next most advanced drug candidate, which we are developing for the treatment of certain patients with a form of non-small cell lung cancer, or NSCLC. We have completed a Phase 2 pivotal clinical trial and submitted a new drug application, or NDA, seeking U.S. marketing approval of brigatinib for patients with metastatic ALK-positive (ALK+) NSCLC who are resistant or intolerant to crizotinib. The PDUFA date for the NDA is April 29, 2017. We have also commenced a global Phase 3 clinical trial of brigatinib, called the ALTA-1L trial, designed to evaluate brigatinib as a potential front-line therapy in ALK+ NSCLC patients. Subject to the timing of enrollment, we currently anticipate to complete enrollment in this trial in 2018.
|
•
|
AP32788
is our most recent, internally discovered drug candidate, which we are developing for the treatment of patients with NSCLC with specific mutations in the EGFR or HER2 kinases. We commenced a Phase 1/2 clinical trial of AP32788 in the second quarter of 2016.
|
|
Three Months Ended September 30,
|
|
Increase/
|
|
|
|||||||||
In thousands
|
2016
|
|
2015
|
|
(decrease)
|
|
% Change
|
|||||||
Product revenue, net
|
$
|
34,300
|
|
|
$
|
27,543
|
|
|
$
|
6,757
|
|
|
25
|
%
|
License, collaboration and other revenue
|
11,716
|
|
|
1,527
|
|
|
10,189
|
|
|
667
|
%
|
|||
|
$
|
46,016
|
|
|
$
|
29,070
|
|
|
$
|
16,946
|
|
|
58
|
%
|
|
Three Months Ended September 30,
|
|
Increase/
|
|
|
|||||||||
In thousands
|
2016
|
|
2015
|
|
(decrease)
|
|
% Change
|
|||||||
Trade allowances
|
$
|
441
|
|
|
$
|
298
|
|
|
$
|
143
|
|
|
48
|
%
|
Rebates, chargebacks and discounts
|
7,205
|
|
|
3,997
|
|
|
3,208
|
|
|
80
|
%
|
|||
Other incentives
|
116
|
|
|
92
|
|
|
24
|
|
|
26
|
%
|
|||
Total adjustments
|
$
|
7,762
|
|
|
$
|
4,387
|
|
|
$
|
3,375
|
|
|
77
|
%
|
Gross product revenue
|
$
|
42,062
|
|
|
$
|
31,930
|
|
|
$
|
10,132
|
|
|
32
|
%
|
Percentage of gross product revenue
|
18.5
|
%
|
|
13.7
|
%
|
|
|
|
|
|
Three Months Ended September 30,
|
|
Increase/
|
|
|
|||||||||
In thousands
|
2016
|
|
2015
|
|
(decrease)
|
|
% Change
|
|||||||
Inventory cost of Iclusig sold
|
$
|
832
|
|
|
$
|
189
|
|
|
$
|
643
|
|
|
340
|
%
|
Shipping and handling costs
|
100
|
|
|
77
|
|
|
23
|
|
|
30
|
%
|
|||
Inventory reserves/write-downs
|
200
|
|
|
217
|
|
|
(17
|
)
|
|
(8
|
)%
|
|||
|
$
|
1,132
|
|
|
$
|
483
|
|
|
$
|
649
|
|
|
134
|
%
|
|
Three Months Ended September 30,
|
|
Increase/
|
|
|
|||||||||
In thousands
|
2016
|
|
2015
|
|
(decrease)
|
|
% Change
|
|||||||
Direct external expenses:
|
|
|
|
|
|
|
|
|||||||
Iclusig
|
$
|
11,400
|
|
|
$
|
13,563
|
|
|
$
|
(2,163
|
)
|
|
(16
|
)%
|
Brigatinib
|
13,282
|
|
|
9,266
|
|
|
4,016
|
|
|
43
|
%
|
|||
All other R&D expenses
|
18,944
|
|
|
25,390
|
|
|
(6,446
|
)
|
|
(25
|
)%
|
|||
|
$
|
43,626
|
|
|
$
|
48,219
|
|
|
$
|
(4,593
|
)
|
|
(10
|
)%
|
|
Nine Months Ended September 30,
|
|
Increase/
|
|
|
|||||||||
In thousands
|
2016
|
|
2015
|
|
(decrease)
|
|
% Change
|
|||||||
Product revenue, net
|
$
|
133,260
|
|
|
$
|
79,262
|
|
|
$
|
53,998
|
|
|
68
|
%
|
License, collaboration and other revenue
|
16,479
|
|
|
3,038
|
|
|
13,441
|
|
|
442
|
%
|
|||
|
$
|
149,739
|
|
|
$
|
82,300
|
|
|
$
|
67,439
|
|
|
82
|
%
|
|
Nine Months Ended September 30,
|
|
Increase/
|
|
|
|||||||||
In thousands
|
2016
|
|
2015
|
|
(decrease)
|
|
% Change
|
|||||||
Trade allowances
|
$
|
1,273
|
|
|
$
|
856
|
|
|
$
|
417
|
|
|
49
|
%
|
Rebates, chargebacks and discounts
|
25,389
|
|
|
9,356
|
|
|
16,033
|
|
|
171
|
%
|
|||
Other incentives
|
209
|
|
|
538
|
|
|
(329
|
)
|
|
(61
|
)%
|
|||
Total adjustments
|
$
|
26,871
|
|
|
$
|
10,750
|
|
|
$
|
16,121
|
|
|
150
|
%
|
Gross product revenue
|
$
|
160,131
|
|
|
$
|
90,012
|
|
|
$
|
70,119
|
|
|
78
|
%
|
Percentage of gross product revenue
|
17
|
%
|
|
12
|
%
|
|
|
|
|
|
Nine Months Ended September 30,
|
|
Increase/
|
|
|
|||||||||
In thousands
|
2016
|
|
2015
|
|
(decrease)
|
|
% Change
|
|||||||
Inventory cost of Iclusig sold
|
$
|
1,779
|
|
|
$
|
728
|
|
|
$
|
1,051
|
|
|
144
|
%
|
Shipping and handling costs
|
464
|
|
|
476
|
|
|
(12
|
)
|
|
(3
|
)%
|
|||
Inventory reserves/write-downs
|
482
|
|
|
462
|
|
|
20
|
|
|
4
|
%
|
|||
|
$
|
2,725
|
|
|
$
|
1,666
|
|
|
$
|
1,059
|
|
|
64
|
%
|
|
Nine Months Ended September 30,
|
|
Increase/
|
|
|
|||||||||
In thousands
|
2016
|
|
2015
|
|
(decrease)
|
|
% Change
|
|||||||
Direct external expenses:
|
|
|
|
|
|
|
|
|||||||
Iclusig
|
$
|
26,008
|
|
|
$
|
25,420
|
|
|
$
|
588
|
|
|
2
|
%
|
Brigatinib
|
37,174
|
|
|
26,068
|
|
|
11,106
|
|
|
43
|
%
|
|||
All other R&D expenses
|
67,387
|
|
|
74,913
|
|
|
(7,526
|
)
|
|
(10
|
)%
|
|||
|
$
|
130,569
|
|
|
$
|
126,401
|
|
|
$
|
4,168
|
|
|
3
|
%
|
|
Nine Months Ended September 30,
|
||||||
In thousands
|
2016
|
|
2015
|
||||
Proceeds from the Incyte transaction, net of cash transferred
|
$
|
143,149
|
|
|
$
|
—
|
|
Option and stock purchase plans
|
14,234
|
|
|
3,596
|
|
||
Proceeds from royalty financing
|
50,000
|
|
|
50,000
|
|
||
Reimbursement of amounts related to facility lease obligation
|
34,173
|
|
|
1,816
|
|
||
|
$
|
241,556
|
|
|
$
|
55,412
|
|
•
|
our existing cash, cash equivalents, and marketable securities;
|
•
|
cash flows from sales of Iclusig, including from royalties on sales outside the United States from our collaborators and distributors;
|
•
|
payments under our license agreement with Incyte, including up to
$14.0 million
in cost-sharing for our OPTIC and OPTIC-2L trials, and up to
$135.0 million
in potential milestone payments;
|
•
|
future milestone payments under our existing collaboration and distribution agreements; and
|
•
|
funding from potential new collaborative agreements, licenses or strategic alliances.
|
|
Nine Months Ended September 30,
|
||||||
In thousands
|
2016
|
|
2015
|
||||
Net cash used in operating activities
|
$
|
(121,436
|
)
|
|
$
|
(120,658
|
)
|
Repayment of long-term borrowings and capital leases
|
(4,813
|
)
|
|
(313
|
)
|
||
Investment in property and equipment
|
(39,572
|
)
|
|
(4,446
|
)
|
||
Payment of tax withholding obligations related to stock compensation
|
(1,541
|
)
|
|
(321
|
)
|
||
|
$
|
(167,362
|
)
|
|
$
|
(125,738
|
)
|
|
|
|
Payments Due By Period
|
||||||||||||||||
In thousands
|
Total
|
|
In
2016 |
|
2017
through 2019 |
|
2020
through 2021 |
|
After
2021 |
||||||||||
Long-term debt
|
$
|
200,000
|
|
|
$
|
—
|
|
|
$
|
200,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Royalty financing
|
94,122
|
|
|
—
|
|
|
—
|
|
|
94,122
|
|
|
—
|
|
|||||
Lease agreements
|
452,614
|
|
|
3,735
|
|
|
91,507
|
|
|
64,756
|
|
|
292,616
|
|
|||||
Other long-term obligations
|
3,890
|
|
|
350
|
|
|
3,390
|
|
|
100
|
|
|
50
|
|
|||||
Total fixed contractual obligations
|
$
|
750,626
|
|
|
$
|
4,085
|
|
|
$
|
294,897
|
|
|
$
|
158,978
|
|
|
$
|
292,666
|
|
•
|
significant damage awards, fines, penalties or other payments, administrative remedies or other rulings that preclude us from operating our business in a certain manner;
|
•
|
changes and additional costs to our business operations to avoid risks associated with such litigation or investigations; and
|
•
|
reputational damage and decreased demand for our products.
|
ARIAD PHARMACEUTICALS, INC.
|
||
|
|
|
By:
|
|
/s/ Paris Panayiotopoulos
|
|
|
Paris Panayiotopoulos
|
|
|
President and Chief Executive Officer
|
|
|
(Principal executive officer)
|
|
|
|
By:
|
|
/s/ Manmeet S. Soni
|
|
|
Manmeet S. Soni
|
|
|
Executive Vice President, Chief Financial Officer and Treasurer
|
|
|
(Principal financial officer and principal accounting officer)
|
Exhibit
Number
|
|
Exhibit Description
|
|
Filed
with
this
Report
|
|
Incorporated by
Reference
herein from
Form or
Schedule
|
|
Filing
Date
|
|
SEC File/
Reg.
Number
|
|||
3.1
|
|
|
|
|
Certificate of Amendment to the Restated Certificate of Incorporation of ARIAD Pharmaceuticals, Inc., dated July 21, 2016
|
|
|
|
8-K
(Exhibit 3.1)
|
|
7/22/2016
|
|
001-36172
|
10.1
|
|
|
|
|
Executive Employment Agreement, dated July 15, 2016, between ARIAD Pharmaceuticals, Inc. and Elona Kogan, Esq.+
|
|
X
|
|
|
|
|
|
|
31.1
|
|
|
|
|
Certification of the Chief Executive Officer
|
|
X
|
|
|
|
|
|
|
31.2
|
|
|
|
|
Certification of the Chief Financial Officer
|
|
X
|
|
|
|
|
|
|
32.1
|
|
|
|
|
Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
X
|
|
|
|
|
|
|
101
|
|
|
|
|
The following materials from ARIAD Pharmaceutical, Inc.’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2016, formatted in XBRL (eXtensible Business Reporting Language): (i) Unaudited Condensed Consolidated Balance Sheets, (ii) Unaudited Condensed Consolidated Statements of Operations, (iii) Unaudited Condensed Consolidated Statements of Comprehensive Loss, (iv) Unaudited Condensed Consolidated Statements of Cash Flows, and (v) Notes to Unaudited Condensed Consolidated Financial Statements.
|
|
X
|
|
|
|
|
|
|
(+)
|
Management contract or compensatory plan or arrangement.
|
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