0001356576-21-000028 | 10-K | XBRL Viewer | Supernus Pharmaceuticals INC

Selling, general and administrative

$ 520,397

$ 392,755

$ 408,897

Costs and expenses

Costs of goods sold

^[1]

52,459

16,660

15,356

Research and development

75,961

69,099

89,209

200,677

153,246

154,698

Amortization of intangible assets

15,702

5,179

5,190

Contingent consideration expense

1,900

Total costs and expenses

346,699

244,184

264,453

Operating earnings

173,698

148,571

144,444

Other (expense) income

Interest expense

(23,754)

(22,707)

(18,111)

Interest and other income, net

18,704

21,623

13,843

Total other expense

(5,050)

(1,084)

(4,268)

Earnings before income taxes

168,648

147,487

140,176

Income tax expense

41,698

34,431

29,183

Net earnings

$ 126,950

$ 113,056

$ 110,993

Earnings per share

Basic (in dollars per share)

$ 2.41

$ 2.16

$ 2.13

Diluted (in dollars per share)

$ 2.36

$ 2.10

$ 2.05

Weighted-average shares outstanding

Basic (in shares)

52,615,269

52,412,181

51,989,824

Diluted (in shares)

53,689,743

53,816,754

54,098,872

Net product sales

Revenue

$ 509,350

$ 383,400

$ 399,871

Royalty revenue

Revenue

11,047

9,355

8,276

Licensing revenue

Revenue

$ 0

$ 750

[1]	Excludes amortization of acquired intangible assets.

Consolidated Statements of Comprehensive Earnings - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Statement of Comprehensive Income [Abstract]
Net earnings	$ 126,950	$ 113,056	$ 110,993
Other comprehensive earnings (loss):
Unrealized gain (loss) on marketable securities, net of tax	1,558	10,575	(2,411)
Other comprehensive earnings (loss), net of tax	1,558	10,575	(2,411)
Comprehensive earnings	$ 128,508	$ 123,631	$ 108,582

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

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Summary of Significant Accounting Policies

Consolidated Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands	Total	Cumulative Effect, Period of Adoption, Adjustment	Cumulative Effect, Period of Adoption, Adjusted Balance	Common Stock	Common Stock Cumulative Effect, Period of Adoption, Adjusted Balance	Additional Paid-in Capital	Additional Paid-in Capital Cumulative Effect, Period of Adoption, Adjustment	Additional Paid-in Capital Cumulative Effect, Period of Adoption, Adjusted Balance	Accumulated Other Comprehensive Earnings (Loss)	Accumulated Other Comprehensive Earnings (Loss) Cumulative Effect, Period of Adoption, Adjusted Balance	Retained Earnings (Accumulated Deficit)	Retained Earnings (Accumulated Deficit) Cumulative Effect, Period of Adoption, Adjustment	Retained Earnings (Accumulated Deficit) Cumulative Effect, Period of Adoption, Adjusted Balance
Balance (in shares) at Dec. 31, 2017				51,314,850	51,314,850
Balance at Dec. 31, 2017	$ 267,480	$ 2,322	$ 269,802	$ 51	$ 51	$ 294,999	$ 0	$ 294,999	$ (747)	$ (747)	$ (26,823)	$ 2,322	$ (24,501)
Increase (Decrease) in Stockholders' Equity
Share-based compensation	11,291					11,291
Issuance of common stock in connection with the Company’s equity award plans (in shares)				1,001,733
Issuance of common stock in connection with the Company’s equity award plans	11,582			$ 1		11,581
Equity issued on conversion of convertible notes	56,215					56,215
Purchase of convertible note hedges, net of tax	(70,137)					(70,137)
Issuance of warrants	65,688					65,688
Net earnings	110,993										110,993
Unrealized gain (loss) on marketable securities, net of tax	(2,411)								(2,411)
Balance (in shares) at Dec. 31, 2018				52,316,583
Balance at Dec. 31, 2018	453,023			$ 52		369,637			(3,158)		86,492
Increase (Decrease) in Stockholders' Equity
Share-based compensation	14,846					14,846
Issuance of common stock in connection with the Company’s equity award plans (in shares)				216,765
Issuance of common stock in connection with the Company’s equity award plans	3,928			$ 1		3,927
Net earnings	113,056										113,056
Unrealized gain (loss) on marketable securities, net of tax	10,575								10,575
Balance (in shares) at Dec. 31, 2019				52,533,348
Balance at Dec. 31, 2019	595,428			$ 53		388,410			7,417		199,548
Increase (Decrease) in Stockholders' Equity
Share-based compensation	16,561					16,561
Issuance of common stock in connection with the Company’s equity award plans (in shares)				335,134
Issuance of common stock in connection with the Company’s equity award plans	4,361					4,361
Net earnings	126,950
Unrealized gain (loss) on marketable securities, net of tax	1,558								1,558
Balance (in shares) at Dec. 31, 2020				52,868,482
Balance at Dec. 31, 2020	$ 744,858			$ 53		$ 409,332			$ 8,975		$ 326,498

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Cash flows from operating activities
Net earnings	$ 126,950	$ 113,056	$ 110,993
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization	18,141	6,659	7,063
Amortization of deferred financing costs and debt discount	16,581	15,708	11,848
Share-based compensation expense	16,561	14,846	11,291
Realized gains from sales of marketable securities	(4,352)	(301)	0
Amortization of premium/discount on marketable securities	(2,889)	(4,034)	(1,665)
Changes in fair value of contingent consideration	1,900	0	0
Other noncash adjustments, net	1,454	2,226	(1,643)
Deferred income tax (benefit) provision	568	(5,832)	(4,167)
Changes in operating assets and liabilities:
Accounts receivable	(34,607)	15,751	(35,856)
Inventories	(10,124)	(969)	(9,355)
Prepaid expenses and other assets	(10,442)	(2,864)	(2,367)
Accrued product returns and rebates	10,386	566	38,720
Accounts payable and other liabilities	8,272	(11,683)	4,124
Net cash provided by operating activities	138,399	143,129	128,986
Cash flows from investing activities
Sales and maturities of marketable securities	378,422	253,170	79,827
Acquisition of USWM, net of cash acquired	(298,541)	0	0
Purchases of marketable securities	(95,890)	(409,707)	(491,654)
Investment in Navitor Pharmaceuticals, Inc.	(15,000)	0	0
Purchases of property and equipment	(3,449)	(2,736)	(844)
Deferred legal fees	(241)	1,349	(809)
Net cash used in investing activities	(34,699)	(157,924)	(413,480)
Cash flows from financing activities
Proceeds from issuance of convertible notes	0	0	402,500
Convertible notes issuance financing costs	0	0	(10,435)
Proceeds from issuance of warrants	0	0	65,688
Proceeds from issuance of common stock	4,361	3,928	11,582
Payments on finance lease liability	(802)	0	(92,897)
Net cash provided by financing activities	3,559	3,928	376,438
Net change in cash and cash equivalents	107,259	(10,867)	91,944
Cash and cash equivalents at beginning of year	181,381	192,248	100,304
Cash and cash equivalents at end of period	288,640	181,381	192,248
Supplemental cash flow information:
Cash paid for interest on convertible notes	2,516	2,516	1,342
Cash paid for Biscayne acquisition	0	0	15,000
Income taxes paid	45,428	51,540	34,772
Noncash investing and financing activity:
Contingent consideration liability related to USWM acquisition	76,700	0	0
Deferred legal fees and fixed assets included in accounts payable and accrued expenses	213	1,832	250
Property and equipment additions from utilization of tenant improvement allowance	$ 0	$ 10,151	$ 0

Organization and Business	12 Months Ended
Organization and Business	Dec. 31, 2020
Organization and Nature of Operations
Organization and Nature of Operations	Organization and Business Supernus Pharmaceuticals, Inc. (the Company) was incorporated in Delaware and commenced operations in 2005. The Company is a biopharmaceutical company focused on developing and commercializing products for the treatment of central nervous system (CNS) diseases. The Company's diverse neuroscience portfolio includes approved treatments for epilepsy, migraine, hypomobility in Parkinson’s Disease, cervical dystonia, and chronic sialorrhea. The Company is developing a broad range of novel CNS product candidates including new potential treatments for attention-deficit hyperactivity disorder (ADHD), hypomobility in Parkinson’s disease, epilepsy, depression, and rare CNS disorders. The Company has five commercial products: Trokendi XR, Oxtellar XR, APOKYN, XADAGO, and MYOBLOC. In addition, the Company has two late-stage development products included in its product candidates portfolio. 2020 USWM Acquisition and Navitor Development Agreements On April 21, 2020, the Company entered into a Development and Option Agreement (Development Agreement) with Navitor Pharmaceuticals, Inc. (Navitor). Under the terms of the Development Agreement, the Company and Navitor will jointly conduct a Phase II clinical program for NV-5138 (SPN-820) in treatment-resistant depression (TRD). Refer to Note 12, Investments in Unconsolidated VIEs, for further discussion on the Navitor Development Agreement. On April 28, 2020, the Company entered into a Sale and Purchase Agreement with US WorldMeds Partners, LLC to acquire the CNS portfolio of USWM Enterprises, LLC (USWM Enterprises) (USWM Acquisition). With the acquisition, completed on June 9, 2020, the Company added three established commercial products, APOKYN, XADAGO, and MYOBLOC, and a product candidate in late-stage development, SPN-830 (apomorphine infusion pump), to its portfolio. Refer to Note 3, USWM Acquisition, for further discussion on the USWM Acquisition.

Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2020

Accounting Policies [Abstract]

Basis of Presentation

The Company's consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (U.S. GAAP).

The Company, which is primarily located in the United States (U.S.), operates in one operating segment.

Reclassifications

Certain prior year amounts in the consolidated balance sheets, statements of cashflows, and statements of earnings have been reclassified to conform to the current year presentation, including a reclassification made to present amortization of intangible assets separately. This was previously included in Selling, general and administrative expenses and now is recorded as a component of Amortization of intangible assets on the consolidated statements of earnings. These reclassifications did not affect operating earnings or other consolidated financial statements for the years ended December 31, 2020, 2019, and 2018.

Consolidation

The Company’s consolidated financial statements include the accounts of: Supernus Pharmaceuticals, Inc.; Supernus Europe Ltd.; Biscayne Neurotherapeutics, Inc. and its wholly owned subsidiary; MDD US Enterprises, LLC (formerly USWM Enterprises, LLC) and its wholly owned subsidiaries. These are collectively referred to herein as “Supernus” or “the Company.” All significant intercompany transactions and balances have been eliminated in consolidation.

The consolidated financial statements reflect the consolidation of entities in which the Company has a controlling financial interest. In determining whether there is a controlling financial interest, the Company considers if it has a majority of the voting interests of the entity, or if the entity is a variable interest entity (VIE) and if the Company is the primary beneficiary. In determining the primary beneficiary of a VIE, the Company evaluates whether it has both: the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance; and the obligation to absorb losses of, or the right to receive benefits from the VIE that could potentially be significant to that VIE. The Company's judgment with respect to its level of influence or control of an entity involves the consideration of various factors, including the form of an ownership interest; representation in the entity’s governance; the size of the investment; estimates of future cash flows; the ability to participate in policymaking decisions; and the rights of the other investors to participate in the decision making process, including the right to liquidate the entity, if applicable. If the Company is not the primary beneficiary of the VIE, and an ownership interest is maintained in the entity, the interest is accounted for under the equity or cost methods of accounting, as appropriate.

The Company continuously assesses whether it is the primary beneficiary of a VIE as changes to existing relationships or future transactions may affect its conclusions.

Use of Estimates

The Company bases its estimates on historical experience; various forecasts; information received from its service providers; information from other sources, including public and proprietary sources; and other assumptions that the Company believes are reasonable under the circumstances. Actual results could differ materially from the Company’s estimates. The Company periodically evaluates the methodologies employed in making its estimates on an ongoing basis.

The extent to which the COVID-19 pandemic may directly or indirectly impact our business, financial condition and results of operations is highly uncertain and subject to change. As a result, certain of our estimates and assumptions, including the provision for sales deductions, the creditworthiness of customers entering into revenue arrangements, the valuation of the assets and liabilities acquired in the USWM Acquisition, and the fair values of our financial instruments, require increased judgment and carry a higher degree of variability and volatility that could result in material changes to our estimates in future periods.

Cash and Cash Equivalents

The Company considers all investments in highly liquid financial instruments with an original maturity of three months or less to be cash equivalents.

Marketable Securities

Marketable securities consist of investments in U.S. Treasury bills and notes; bank certificates of deposit; various U.S. government agency debt securities; corporate and municipal debt securities; and other fixed income securities. The Company places all investments with governmental, industrial, or financial institutions whose debt is rated as investment grade.

The Company's investments are classified as available-for-sale and are carried at fair value. The Company classifies all available-for-sale marketable securities with maturities greater than one year from the balance sheet date as non-current assets.

Any unrealized holding gains or losses on debt securities, including their tax effect, are reported as components of Other comprehensive earnings (loss) in the consolidated statement of comprehensive earnings. Realized gains and losses, included in Interest and other income, net in the consolidated statement of earnings, are determined using the specific identification method for determining the cost of securities sold.

The Company adopted Accounting Standards Update (ASU) No. 2016-13, Financial Instruments - Credit Losses (Topic 326) on January 1, 2020, using the allowance approach. Declines in fair value below amortized cost related to credit losses (i.e., impairment due to credit losses) are included in the consolidated statement of earnings, with a corresponding allowance established. If the estimate of expected credit losses decreases in subsequent periods, the Company will reverse the credit losses through current period earnings and adjust the allowance accordingly. Refer to Recently Issued Accounting Pronouncements in this Note 2.

Business Combinations and Contingent Considerations

In determining whether an acquisition should be accounted for as a business combination or as an asset acquisition, the Company makes certain judgments regarding whether the acquired set of activities and assets meets the definition of a business. Significant judgment is required in assessing whether the acquired processes or activities, along with their inputs, would be substantive to constitute a business, as defined by U.S. GAAP.

If the acquired set of activities and assets does not meet the definition of a business, the transaction is accounted for as an asset acquisition. In an asset acquisition, any acquired research and development that does not have an alternative future use is charged to expense as of the acquisition date, and no goodwill is recorded.

If the acquired set of activities and assets meets the definition of a business, the Company applies the acquisition method of accounting and accounts for the transaction as a business combination. In a business combination, assets acquired and liabilities assumed are recorded at their respective fair values as of the acquisition date. The excess of the purchase price over the fair value of the acquired net assets, if applicable, is recorded as goodwill. The Company accounted for the USWM Acquisition as a business combination.

In a business combination, the operating results of the acquired business are included in the Company’s consolidated statement of earnings, beginning on the effective acquisition date. Acquisition-related expenses are recognized separately from the business combination and are expensed as incurred.

Significant judgment is involved in the determination of the fair value assigned to assets acquired and liabilities assumed in a business combination, as well as the estimated useful lives of assets. These estimates can materially affect our consolidated results of operations and financial position. The fair value of intangible assets, including acquired in-process research and development (IPR&D), are determined using information available as of the acquisition date and are based on estimates and assumptions that are deemed reasonable by management. Significant estimates and assumptions include but are not limited to: the probability of regulatory approval, revenue growth, and appropriate discount rate. Depending on the facts and circumstances, the Company may deem it necessary to engage an independent valuation expert to assist in valuing significant assets and liabilities.

While the Company uses its best estimates and assumptions to accurately value assets acquired and liabilities assumed as of the acquisition date, estimates are inherently uncertain and subject to refinement. As a result, during the measurement period, which may be up to one year from the acquisition date, the Company may record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill.

Uncertain tax positions and tax-related valuation allowances are initially recorded in connection with a business combination as of the acquisition date. The Company continues to collect information related to facts and circumstances existing as of the acquisition date and evaluate these estimates and assumptions. The Company records any adjustments to the Company’s preliminary estimates to goodwill based on the facts and circumstances existing as of the acquisition date (measurement period adjustments).

Upon the conclusion of the measurement period, any subsequent adjustments are recorded to our consolidated statements of earnings in the period that these adjustments are identified.

Contingent Considerations

The USWM Acquisition involved potential future payments contingent upon the achievement of certain milestones primarily related to the development and commercial sale of the acquired IPR&D, SPN-830 (apomorphine infusion pump), including product development milestones and sales-based milestone payments on future product sales. The fair value of the contingent consideration liability is determined as of the acquisition date using estimated or forecast inputs. These inputs include the estimated amount and timing of projected revenues, probability and timing of milestone achievement, probability of IPR&D achieving regulatory approval, revenue volatility, and the estimated discount rates and risk-free rate used to present value the probability-weighted cash flows. Subsequent to the acquisition date, at each reporting period prior to the resolution of the contingency, the contingent consideration liability is remeasured at current fair value, with changes recorded in earnings in the period of remeasurement.

The determination of the initial and subsequent fair value of the contingent consideration liability requires significant judgment by management. Changes in any of the inputs not related to facts and circumstances existing as of the acquisition date may result in a significant fair value adjustment, which can impact the results of operations in the period in which the adjustment is made. Changes that are not measurement period adjustments are reported on the consolidated statement of earnings in Contingent consideration expense.

Additional information regarding the USWM Acquisition is included in Note 3, USWM Acquisition.

Accounts Receivable, Net

Accounts receivable are reported on the consolidated balance sheets at outstanding amounts due from customers, less an allowance for doubtful accounts, sales discounts, and sales allowances. The Company extends credit without requiring collateral.

The Company writes off uncollectible receivables when the likelihood of collection is remote. The Company evaluates the collectability of accounts receivable on a regular basis. An allowance, when needed, is based upon various factors, including: the financial condition and payment history of customers; an overall review of collections experience on other accounts; and economic factors or events expected to affect future collections experience. Payment terms for receivables are based on customary commercial terms and are predominantly less than one year.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to credit risk concentrations consist of cash, cash equivalents, marketable securities, and accounts receivable. The counterparties are various corporations, governmental institutions, and financial institutions of high credit standing.

Substantially all of the Company's cash, cash equivalents, and marketable securities are maintained in U.S. government agency debt and debt of well-known, investment grade corporations. Deposits held with banks may exceed the amount of governmental insurance provided on such deposits. Generally, these deposits may be redeemed upon demand, and therefore, these bear minimal default risk.

The following table shows the percentage of the Company's sales made to and percentage of accounts receivables from wholesalers and distributors representing more than 10% of the Company's total net product sales and more than 10% of the Company's accounts receivables, net:


	Percentage of Net Product Sales						Percentage of Accounts Receivable, net
	2020		2019		2018		2020		2019
Customer A	29	%	32	%	33	%	31	%	45	%
Customer B	31	%	32	%	33	%	32	%	21	%
Customer C	29	%	34	%	32	%	22	%	30	%
	89	%	98	%	98	%	85	%	96	%

Refer to Note 4, Disaggregated Revenues, for the concentration of net product sales.

Inventories

Inventories are recorded at the lower of cost or net realizable value, include materials, labor, direct costs and indirect costs. These are valued using the first-in, first-out method. The Company writes down inventory that has become obsolete or has a cost basis in excess of its expected net realizable value. Expired inventory is destroyed, and the related costs are recognized as Cost of goods sold in the consolidated statement of earnings.

Inventories Produced in Preparation of Product Launches

The Company capitalizes inventories produced in preparation for product launches when future commercialization of a product is probable and when a future economic benefit is expected to be realized. The determination to capitalize is based on the particular facts and circumstances relating to the product. Capitalization of such inventory begins when the Company determines that (i) positive clinical trial results have been obtained in order to support regulatory approval; (ii) uncertainties regarding regulatory approval have been significantly reduced; and (iii) it is probable that these capitalized costs will provide a future economic benefit in excess of capitalized costs.

In evaluating whether these conditions are met, the Company considers the following factors: the product candidate’s current status in the regulatory approval process; results from the related pivotal and supportive clinical trials; results from meetings with relevant regulatory agencies prior to the filing of regulatory applications; completion of the regulatory applications; consequent acceptance by the regulatory agency; potential impediments to the approval process such as product safety or efficacy concerns, potential labeling restrictions, and other impediments: historical experience with manufacturing and commercializing similar products as well as the manufacture of the relevant product candidate; and the Company’s manufacturing environment, and supply chain in determining logistical constraints that could hamper approval or commercialization.

In assessing the economic benefit that the Company is likely to realize, the Company considers the shelf life of the product in relation to the expected timeline for approval; patent related or contractual issues that may prevent or delay commercialization and product stability data of all pre-approval production to assess the adequacy of expected shelf life; viability of commercialization taking into account competitive dynamics in the marketplace and market acceptance; and anticipated future sales and anticipated reimbursement strategies that may prevail with respect to the product, to determine product profit margin.

In applying the lower of cost or net realizable value to pre-launch inventory, the Company estimates a range of likely commercial prices based on the pricing of competitive commercial products and pre-launch discussions with managed care providers.

The Company could be required to write down previously capitalized costs related to pre-launch inventories upon a change in facts and circumstances, including, among other potential factors, a denial or significant delay of approval by regulatory bodies, a delay in commercialization, or other adverse factors.

Intangible Assets

Intangible assets consist of definite-lived intangible assets: acquired developed technology and product rights, and patent defense costs, and an indefinite-lived intangible asset: acquired IPR&D.

Patent defense costs are legal fees that have been incurred in connection with legal proceedings related to the defense of patents for Oxtellar XR and Trokendi XR. Patent defense costs are charged to expense in the event of an unsuccessful litigation outcome.

Definite-lived intangible assets are carried at cost less accumulated amortization, with amortization calculated on a straight line basis over the estimated useful lives of the assets. The Company evaluates the estimated remaining useful life of its intangible assets annually, or when events or changes in circumstances warrant a revision to the remaining periods of amortization.

Acquired IPR&D in a business combination is considered an indefinite-lived intangible asset until the completion or abandonment of the associated research and development efforts. Upon successful completion of the project, the Company will determine as to the then-useful life of the intangible asset. This is generally determined as the period over which the substantial majority of the cash flows are expected to be generated. The capitalized amount is then amortized over its estimated useful life. If a project is abandoned, all remaining capitalized amounts are written off immediately. During the period prior to completion or abandonment, the IPR&D asset is not amortized but tested for impairment on an annual basis or when potential indicators of impairment are identified.

Impairment of Long-Lived Assets

Long-lived assets consist primarily of property and equipment, operating and finance lease assets, and definite-lived intangible assets. The Company assesses the recoverability of its long-lived assets with definite lives whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If indications of impairment exist, projected future undiscounted cash flows associated with the asset would be compared to the carrying value of the asset to determine whether the asset's value is recoverable. If impairment is determined, the Company writes down the asset to its estimated fair value and records an impairment loss equal to the excess of the carrying value of the long-lived asset over its estimated fair value in the period at which such a determination is made.

Impairment of Indefinite-Lived Intangible Assets

For indefinite-lived intangible assets, such as the acquired IPR&D asset, the Company evaluates impairment annually in the fourth quarter or more frequently if impairment indicators exist. The annual evaluation is generally based on an assessment of qualitative factors to determine whether it is more likely than not that the fair value of the asset is less than its carrying amount. The Company considers various factors including but is not limited to significant or adverse changes in the legal and regulatory environment, adverse clinical trial results, significant trial delays, inability to obtain governmental approval, inability to commercialize a product candidate the introduction or advancement of competitive products, and product candidates, or other events that indicate it is more likely than not that fair value is less than its carrying value. If the Company is unable to conclude whether the indefinite-lived intangible asset is not impaired after considering the totality of events and circumstances during its qualitative assessment, the Company performs a quantitative assessment by estimating the fair value of the indefinite-lived intangible asset and comparing the fair value to the carrying amount. If the carrying amount of the indefinite-lived intangible asset exceeds its fair value, the Company writes down the indefinite-lived intangible asset to its estimated fair value, and an impairment loss equal to the difference between the assets fair value and carrying value is recognized in the consolidated statement of earnings in the period at which such determination is made.

Evaluating for goodwill impairment requires judgment, including evaluating current economic and competitive circumstances, estimating future cash flows, future growth rates, future profitability, and the expected life over which projected cash flows would occur.

Goodwill and Goodwill Impairment Assessment

Goodwill is calculated as the excess of the consideration paid consequent to completing an acquisition compared to the net assets recognized in a business combination. Goodwill represents the future economic benefits from the other acquired assets that could not be individually identified and separately quantified.

The Company evaluates goodwill for possible impairment at least annually (during the fourth quarter of each fiscal year), or more often, if and when events and circumstances indicate that goodwill may be impaired. The annual evaluation is generally based on an assessment of qualitative factors to determine whether it is more likely than not that the fair value of the asset is less than its carrying amount. This includes but is not limited to significant adverse changes in the business climate, market conditions, or other events that indicate that it is more likely than not that the fair value of the reporting unit is less than its carrying value. If the Company is unable to conclude whether the goodwill is not impaired after considering the totality of events and circumstances during its qualitative assessment, the Company performs a quantitative assessment by estimating the fair value of the reporting unit and comparing the fair value to the carrying amount. If the carrying amount of the reporting unit exceeds its fair value, the Company writes down the goodwill to the estimated fair value, and an impairment loss equal to the difference is recognized in the consolidated statement of earnings in the period at which such determination is made.

Evaluating for impairment requires judgment, including identifying reporting units and estimating future cash flows. The Company estimates the fair values of its reporting unit using discounted cash flow models or other valuation models, such as comparative transactions or market multiples.

Interest Expense

Interest expense includes stated interest and the amortization of deferred financing costs and debt discount incurred by the Company in connection with the issuance of $402.5 million of 0.625% Convertible Senior Notes due 2023, (see Note 6). The Company amortizes the deferred financing costs and debt discount over the term of the debt, using the effective interest method.

Revenue Recognition

The Company recognizes revenue in an amount that reflects the consideration the Company expects to receive in exchange for those goods or services. The Company does not adjust revenue for any financing effects in transactions where the Company expects the period between the transfer of the goods or services and collection to be less than one year.

No contract assets or liabilities were recorded as of December 31, 2020, or 2019.

Revenue from Product Sales

The Company’s customers are primarily pharmaceutical wholesalers, specialty pharmacies, and pharmaceutical distributors. Customers purchase product to fulfill orders from retail pharmacy chains and independent pharmacies of varying size and purchasing power. The Company recognizes gross revenue when its products are shipped from a third party fulfillment center and physically received by its customers. The Company's customers take control of its products, including title and ownership, upon the physical receipt of its products at their facilities. Customer orders are generally fulfilled within a few days of order receipt, resulting in minimal order backlog. There are no minimum product purchase requirements with our customers.

The Company recognizes revenue from product sales in an amount that reflects the consideration the Company expects to ultimately receive in exchange for those goods. Product sales are recorded net of various forms of variable consideration, including: provision for estimated rebates; provision for estimated future product returns; and an estimated provision for discounts. These are collectively considered "sales deductions."

As described below, variability in the net transaction price for the Company’s products arises primarily from the aforementioned sales deductions. Significant judgment is required in estimating certain sales deductions. In making these estimates, the Company considers: historical experience; product price increases; current contractual arrangements under applicable payor programs; unbilled claims; processing time lags for claims; inventory levels in the wholesale, specialty pharmacy, and retail distribution channel; and product life cycle. The Company adjusts its estimates of revenue either when the most likely amount of consideration it expects to receive changes, or when the consideration becomes fixed.

Variable consideration on product sales is only recognized when it is probable that a significant reversal will not occur.

If actual results in the future vary from our estimates, the Company adjusts its estimates in the period identified. These adjustments could materially affect net product sales and earnings in the period in which the adjustment(s) is recorded.

Sales Deductions

The Company records product sales net of the following sales deductions:

Rebates:

Rebates are discounts which the Company pays under either public sector or private sector health care programs. Rebates paid under public sector programs are generally mandated under law, whereas private sector rebates are generally contractually negotiated by the Company with managed care providers. Both types of rebates vary over time.

Public sector rebate programs encompass: various Medicaid drug rebate programs; Medicare gap coverage programs; programs covering public health service institutions; and programs covering government entities. All federal employees and agencies purchase drugs under the Federal Supply Schedule.

Private sector rebate programs include: contractual agreements with managed care providers, under which the Company pays fees to gain access to that provider’s patient drug formulary; and Company-sponsored programs, under which the Company defrays or eliminates patient co-payment charges that the patient would otherwise be obligated to pay to their managed care provider in order to fill their prescription.

Rebates are owed upon dispensing our product to a patient; i.e., filling a prescription. The accrual balance for rebates consists of the following three components. First, because rebates are generally invoiced and paid in arrears, the accrual balance consists of an estimate of the amount expected to be incurred for prescriptions dispensed in the current quarter. Second, the accrual balance also includes an estimate for known or estimated prior quarters’ unpaid rebates, covering those prescriptions dispensed in past quarters but for which no invoice has yet been received. Third, the accrual balance includes an estimate for rebates that will be prospectively owed for prescriptions filled in future quarters. This estimate pertains to a product that has been sold by the Company to wholesalers or distributors and which resides either as wholesaler/distributor inventory or as inventory held at pharmacies. As of the end of the reporting period, this product has not been dispensed to a patient.

The Company’s estimates of expected rebate claims vary by program and by type of customer because the period between the date at which the prescription is filled and the date the Company receives and pays the invoice varies substantially. For each of its products, the Company bases its estimates of expected rebate claims on multiple factors, including: historical levels of deductions; contractual terms with managed care providers; actual and anticipated changes in product price; prospective changes in managed care fee for service contracts; prospective changes in co-payment assistance programs; and anticipated changes in program utilization rates; i.e., patient participation rates under each specific program.

The Company records an estimated liability for rebates at the time the customer takes title to the product (i.e., at the time of sale to wholesalers/distributors). This liability is recorded as a reduction to gross product sales, and an increase in Accrued product returns and rebates. The liability is recorded as a component of current liabilities on the consolidated balance sheets.

The sensitivity of the Company’s estimates to subsequent adjustment varies by program and by type of customer. If actual rebates vary from estimated amounts, the Company adjusts the balances of such accrued rebates to reflect actual experience. These adjustments could materially affect the estimated liability balance, net product sales, and earnings in the period in which these adjustments are made.

Returns:

Sales of the Company’s products are not subject to a general right of return. A product that has been used to fill patient prescriptions is no longer subject to any right of return. However, the Company will accept a return of product that is damaged or defective when shipped from its third party fulfillment centers.

The Company will also accept a return of expired product six months prior to and up to 12 months subsequent to the product’s expiry date for certain products. Expired or defective returned product cannot be re-sold and is therefore destroyed.

The Company records an estimated liability for product returns at the time the customer takes title to the product (i.e., at time of sale). The liability is reflected as a reduction to gross product sales, and an increase in Accrued product returns and rebates. This liability is recorded as a component of current liabilities on the consolidated balance sheets. The Company estimates the liability for returns primarily based on the actual returns experience for its commercial products.

Because the Company’s products have a shelf life up to 48 months from the date of manufacture, and because the Company accepts return of product up to 12 months post its expiry date, there is a time lag of several years between the time when the product is sold and the time when the Company issues credit on the expired product.

The Company’s returns policy generally permits product returns to be processed at the current wholesaler price rather than at historical acquisition price; hence, the Company’s estimated liability for product returns is affected by price increases taken subsequent to the date of sale and prior to its return.

At the time the Company adjusts its estimates for product returns, such adjustment affects the estimated liability, product sales, and earnings in the period of adjustment. Those adjustments may be material to our financial results.

Sales discounts:

Distributors and wholesalers of the Company's pharmaceutical products are generally offered various forms of consideration, including allowances, service fees and prompt payment discounts, for distributing our products. Distributor and wholesaler allowances and service fees arise from contractual agreements and are estimated as a percentage of the price at which the Company sells product to them. In addition, distributors and wholesalers are offered a prompt pay discount for payment within a specified period. Prompt pay discounts are estimated as a percentage of the price at which the Company sells product.

The Company accounts for these discounts at the time of sale as a reduction to gross product sales.

License Revenue

The Company has entered into collaboration agreements to commercialize certain of its products outside of the U.S. Those agreements include the right to use the Company’s intellectual property as a functional license and generally include an up-front license fee and ongoing milestone payments upon the achievement of certain specific events. These agreements may also require minimum royalty payments based on sales of products that use the applicable intellectual property.

Up-front license fees are recognized once the license has been executed between the Company and its licensee.

Milestones are a form of variable consideration recognized when either the underlying events have transpired (i.e., event-based milestone) or when the sales-based targets have been met by the collaborative partner (i.e., sales-based milestone). Both types of milestone payments are nonrefundable. The Company evaluates whether achieving the milestone is considered probable and estimates the amount of the milestone to be included in the transaction price using the most likely amount method. The value of the associated milestone is not included in the transaction price if it is probable that a significant revenue reversal would occur. This estimation is based on management’s judgment and may require assessing factors that are outside of the Company’s influence, such as: likelihood of regulatory success; availability of third party information; and expected time period until achievement of the event. These factors are evaluated based on the specific facts and circumstances.

Event-based milestones are recognized in the period that the related event, such as regulatory approval, occurs. Milestones that are not within the control of the Company, such as approval from regulatory authorities, or where attainment of the specified event is dependent on the success of a third-party, are not considered probable until the specified event occurs.

Sales-based milestones are recognized as revenue only when the sales-based target is achieved.

There are no guaranteed minimum amounts owed to the Company related to license and collaboration agreements.

Royalty Revenue

The Company recognizes noncash royalty revenue for amounts earned pursuant to its royalty agreement with United Therapeutics Corporation (United Therapeutics), based on estimated product sales of Orenitram by United Therapeutics (see Note 4). This agreement includes the right to use the Company’s intellectual property as a functional license.

In 2014, the Company sold certain of these royalty rights to Healthcare Royalty Partners III, L.P. (HC Royalty) (see Note 21). Consequent to this agreement, the Company recorded a nonrecourse liability related to this transaction and amortizes this liability as noncash royalty revenue. Sales of Orenitram by United Therapeutics result in payments from United Therapeutics to HC Royalty, in accordance with this agreement.

The Company also recognizes noncash interest expense related to the nonrecourse liability and accrues interest expense at an estimated effective interest rate (see Note 19). This interest rate is determined based on projections of HC Royalty’s rate of return.

Royalty revenue also includes cash royalty amounts received from other collaboration partners, including from Takeda Pharmaceutical Company Ltd., based on net product sales of Takeda's product, Mydayis, in the current period. Royalty revenue is only recognized when the underlying product sale by Takeda has occurred. The Takeda arrangement also includes Takeda's right to use the Company’s intellectual property as a functional license.

There are no guaranteed minimum amounts owed to the Company related to any of these royalty revenue agreements.

Cost of Goods Sold

The cost of goods sold consists primarily of materials; third-party manufacturing costs; freight and distribution costs; direct labor; cost of royalties; cost to write down inventory to net realizable value and manufacturing overhead costs, including quality control and assurance.

Research and Development Expenses

Research and development expenditures are expensed as incurred. These expenses include: employee salaries, benefits, and share-based compensation; cost of contract research and development services provided by third parties; costs for preclinical and clinical studies; cost of acquiring or manufacturing clinical trial materials; regulatory costs; research facilities costs; depreciation expense and allocated occupancy expenses; and license fees and milestone payments related to in-licensed products and technologies. Acquired IPR&D assets that are used for research and development and have no future alternative use are expensed as incurred in-process research and development.

The Company estimates preclinical and clinical trial expenses based on services performed pursuant to contracts with research institutions, clinical investigators, clinical research organizations (CROs), and other service providers that perform services on the Company’s behalf. In recording service fees, the Company estimates the cost of those services performed on behalf of the Company during the current period and compares those costs with the cumulative expenses recorded and payments made for such services. As appropriate, the Company accrues additional expense for services that have been delivered or defers nonrefundable advance payments until the related services are performed.

If the actual timing of the performance of services or the level of effort varies from our estimate, the Company adjusts its accrued expenses, or its deferred advance payments, accordingly. If the Company subsequently determines that it no longer expects the services associated with a nonrefundable advance payment to be rendered, the remaining portion of that advance payment is charged to expense in the period in which such determination is made.

Share-Based Compensation

Stock Options

The Company recognizes share-based compensation expense over the service period, using the straight-line method. Employee share-based compensation for stock options is determined using the Black-Scholes option-pricing model to compute the fair value of option grants as of their grant date. Forfeitures are accounted for as incurred. The Company uses the following assumptions for estimating the fair value of option grants:

•Fair Value of Common Stock—The fair value of the common stock underlying the option grants is determined based on observable market prices of the Company’s common stock.

•Expected Volatility—Volatility is a measure of the amount by which the Company’s share price has historically fluctuated or is expected to fluctuate on a daily basis and is expected to fluctuate (i.e., expected volatility) in the future.

•Dividend Yield—The Company has never declared or paid dividends and has no plans to do so in the foreseeable future. Dividend yield is therefore zero.

•Expected Term—This is the period of time during which options are expected to remain unexercised. For the years ended December 31, 2020, and 2019, we determined the expected term based on the historical exercise behavior of the stock option plan participants. Options have a maximum contractual term of ten years.

•Risk-Free Interest Rate—This is the observed U.S. Treasury Note rate as of the week each option grant is issued, with a term that most closely resembles the expected term of the option.

Restricted Stock Units (RSUs)

Share-based compensation expense is recorded based on amortizing the fair market value of the RSU as of the date of the grant over the implied service period. RSUs generally vest one year from the date of the grant and are subject to continued service requirements. Forfeitures are accounted for as incurred.

Performance Stock Units (PSUs)

Performance-Based Awards

Share-based compensation expense for performance-based awards is recognized based on amortizing the fair market value of the award as of the grant date over the periods during which the achievement of the performance target is probable. Performance-based awards require certain performance targets to be achieved in order for the award to vest. Vesting occurs on the date of achievement of the performance target. Forfeitures are accounted for as incurred.

Market-Based Awards

Share-based compensation expense for market-based awards is recognized on a straight-line basis over the requisite service period, regardless of whether the market condition has been satisfied. Market-based PSU awards vest upon the achievement of the performance target. Forfeitures are accounted for as incurred.

The Company estimates the fair value of these awards as of the grant date using a Monte Carlo simulation that incorporates option-pricing inputs. This simulation covers the period from the grant date through the end of the derived requisite service period. Volatility as of the grant date is estimated based on historical daily volatility of the Company's common stock over a period of time, which is equivalent to the expected term of the award. The risk-free interest rate is based on the U.S. Treasury Note rate, as of the week, the award is issued, with a duration that most closely resembles the expected term of the award.

Leases

On January 1, 2019, the Company adopted Accounting Standards Update (ASU) No. 2016-02, Leases (Topic 842) (New Lease Standard) using the modified retrospective transition approach. We applied the new standard to all leases existing at the date of initial application. Refer to the discussion under Recently Issued Accounting Pronouncements in Note 2.

The Company determines if an arrangement is a lease considering whether there is an identified asset and the contract conveys the right to control its use. Leases with an initial term of 12 months or less are not recorded on the balance sheet. Right-of-use (ROU) assets and lease liabilities are recognized at the commencement date based on the present value of remaining lease payments over the lease term. For this purpose, the Company considers only payments that are fixed and determinable at the time of commencement. The Company calculates the present value of future payments by using an estimated incremental borrowing rate, which approximates the rate at which the Company would borrow, on a secured basis and over a similar term. This rate is estimated based on information available at the commencement date of the lease and may differ for individual leases or portfolios of leased assets. Additionally, for certain equipment leases, the Company applies a portfolio approach to effectively account for the operating lease ROU assets and lease liabilities.

Lease expense for operating leases is recognized on a straight-line basis over the expected lease term and recognized as an operating cost. The finance lease asset related to a manufacturing facility is amortized on a straight-line basis over the lease term. Interest expense on finance lease liability is also recognized over the lease term.

Some of the Company’s leases include options to terminate prior to the end of the lease term or to extend the lease for one or more years. These options are included in the lease term when it is reasonably certain that the option will be exercised.

The Company’s lease agreements may contain variable costs such as common area maintenance, insurance, real estate taxes, or other costs. Variable lease costs are expensed as incurred on the consolidated statements of earnings. The Company’s lease agreements generally do not contain any material residual value guarantees or material restrictive covenants.

Advertising Expense

Advertising expense includes the cost of promotional materials and activities, such as printed materials and digital marketing, marketing programs, and speaker programs. The cost of the Company's advertising efforts is expensed as incurred.

The Company incurred approximately $54.5 million, $40.8 million, and $43.3 million in advertising expense for the years ended December 31, 2020, 2019, and 2018, respectively. These expenses are recorded as a component of Selling, general and administrative expenses in the consolidated statements of earnings.

Income Taxes

The Company utilizes the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and deferred tax liabilities are determined based on differences between their financial reporting and tax reporting bases. These differences are measured using enacted tax rates and laws that are expected to be in effect when the differences are expected to reverse. When appropriate, valuation allowances are established to reduce deferred tax assets to the amounts expected to be realized.

The Company accounts for uncertain tax positions in its consolidated financial statements when it is more-likely-than-not that the position will be sustained upon examination by the tax authorities. Such tax positions are initially and subsequently estimated as the largest amount of the tax benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authorities. These estimates are based on full knowledge of the position and relevant facts.

The Company's policy is to recognize any interest and penalties related to income taxes as income tax expense in the relevant period.

Recently Issued Accounting Pronouncements

Accounting Pronouncements Adopted

ASU 2016-02, Leases (Topic 842) and subsequently issued related amendments codified in ASC 842, Leases, (the New Lease Standard), effective January 1, 2019, requires lessees to recognize lease assets and lease liabilities for those leases classified as operating leases under the previous GAAP, ASC 840, on the balance sheet and provide enhanced disclosures surrounding the amount, timing and uncertainty of cash flows arising from leasing arrangements.

The Company adopted the New Lease Standard using the modified retrospective transition approach on January 1, 2019, by applying the New Lease Standard to all leases existing at the date of the initial adoption and not restating comparative periods. The adoption of the New Lease Standard resulted in recognition of lease assets and lease liabilities as of January 1, 2019, of approximately $4.0 million. The Company elected the package of practical expedients permitted under the transition guidance, which, among other things, allowed the Company to carryforward the historical lease classification, the assessment on whether a contract was or contains a lease, and the initial direct costs for any leases that existed prior to January 1, 2019. Refer to Note 10, Leases.

ASU 2016-13, Financial Instruments—Credit Losses (Topic 326) - The new standard, issued in July 2016, requires credit losses on financial assets to be measured as the net amount expected to be collected, rather than based on actual incurred losses. For available-for-sale debt securities, the new standard did not revise the definition of impairment. The new standard also eliminated the concept of "other than temporary" from the impairment model for available-for-sale debt securities. Changes to the impairment model include recognition of credit losses on available-for-sale debt securities using the allowance method and limiting the allowance to the amount by which fair value is below amortized cost. The Company adopted the new standard effective January 1, 2020, using the modified retrospective approach. The adoption of the standard did not have a material impact on its consolidated financial statements.

ASU 2018-13, Changes to Disclosure Requirements for Fair Value Measurements (Topic 820) - The new standard, issued in August 2018, improved the effectiveness of disclosure requirements for recurring and nonrecurring fair value measurements. The standard removes, modifies, and adds certain disclosure requirements. The Company adopted the new standard effective January 1, 2020. The adoption of the standard did not have a material impact on its consolidated financial statements.

ASU 2018-15, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract - The new standard, issued in August 2018, aligns the requirements for capitalizing implementation costs incurred under a service contract for a hosting arrangement with the requirements for capitalizing implementation costs incurred to develop or to obtain internal-use software. This includes hosting arrangements that include an internal-use software license. This ASU also requires that the implementation costs of a hosting arrangement under a service contract be expensed over the term of the hosting arrangement, including reasonably certain renewals. The Company adopted the new standard effective January 1, 2020, using the prospective transition approach. The adoption of the standard did not have a material impact on its consolidated financial statements.

ASU 2018-18, Clarifying the Interaction Between Topic 808 and Topic 606 - The new standard, issued in November 2018, clarifies when transactions between participants in a collaborative arrangement are within the scope of Topic 606. The Company adopted the new standard effective January 1, 2020. The adoption of the standard did not have a material impact on its consolidated financial statements.

New Accounting Pronouncements Not Yet Adopted

ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes - The new standard, issued in December 2019, simplifies the accounting for income taxes. This guidance will be effective on January 1, 2021, on a prospective basis, with early adoption permitted. ASU 2019-12 amends the requirements related to the accounting for “hybrid” tax regimes. Such regimes are tax jurisdictions that impose the greater of two taxes — one based on income or one based on items other than income. Under ASU 2019-02, an entity should include the amount of tax based on income in the tax provision and should record any incremental amount recorded as a tax not based on income. The Company will adopt the standard effective January 1, 2021. It is not expected to have a material effect on our consolidated financial statements.

ASU 2020-01, Investments — Equity Securities (Topic 321), Investments — Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815), Clarifying the Interactions between Topic 321, Topic 323, and Topic 815 - The new standard, issued in January 2020, clarifies the interaction of the equity securities under Topic 321 and investments accounted for under the equity method of accounting in Topic 323 and the accounting for certain contracts and purchased options accounted under Topic 815. The amendment clarifies that an entity can elect to adopt the measurement alternative, which is if an entity identifies observable price changes in orderly transactions for the identical or a similar investment of the same issuer, it should measure the equity security at fair value as of the date that the observable transaction occurred before applying or upon discontinuing the equity method. ASU 2020-01 will be effective on January 1, 2021. The Company will adopt the standard effective January 1, 2021. It is not expected to have a material effect on our consolidated financial statements.

ASU 2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity's Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity's Own Equity - The new standard, issued in August 2020, simplifies the accounting and disclosures for convertible instruments and contracts. Under ASU 2020-06, entities must apply the if-converted method to all convertible instruments; the treasury stock method is no longer available. This guidance will be effective on January 1, 2022, on a prospective basis, with early adoption

permitted but not earlier than January 1, 2021. The Company is currently evaluating the impact of the new guidance on its consolidated financial statements.

USWM Acquisition

12 Months Ended

Dec. 31, 2020

Business Combinations [Abstract]

USWM Acquisition

On June 9, 2020 (the Closing Date), the Company completed its acquisition of all of the outstanding equity of USWM Enterprises, LLC (USWM Enterprises), a privately-held biopharmaceutical company, pursuant to the Sale and Purchase Agreement with US WorldMeds Partners, LLC (Seller), dated April 28, 2020 (the Agreement). Under the terms of the Agreement, the Company acquired the right to further develop and commercialize APOKYN, XADAGO, and the Apomorphine Infusion Pump (SPN-830) in the U.S., and MYOBLOC worldwide (the Products) for an upfront cash payment of $297.2 million, subject to working capital adjustments, and the potential for additional contingent consideration payments of up to $230 million.

The potential $230 million in contingent consideration payments includes up to $130 million for the achievement of certain SPN-830 regulatory and commercial activities (regulatory and developmental contingent consideration payments) and up to $100 million related to future sales performance of the Products (sales-based contingent consideration payments). The regulatory and developmental contingent consideration payments include a $25 million milestone due upon the U.S. Food and Drug Administration's (FDA) acceptance of the SPN-830 New Drug Application (NDA) for review. The remaining $105 million of the $130 million contingent consideration payments include payments upon the FDA's regulatory approval and commercial launch of SPN-830. One of the regulatory milestones has a time-based mechanism for full or partial achievement. The $100 million sales-based contingent consideration payments include a $35 million milestone due upon achievement of certain U.S. net product sales of APOKYN during 2021. The remaining $65 million of the $100 million sales-based contingent consideration payments relate to the achievement of certain net product sales of the Products in 2022 and 2023.

The acquisition is being accounted for as a business combination under the acquisition method of accounting, in accordance with ASC 805, Business Combinations. The excess of the purchase price over the fair value of the net assets acquired was recorded as goodwill. The estimated fair values of the assets acquired and liabilities assumed, including goodwill, have been included in the Company's consolidated financial statements since the acquisition's Closing Date.

The Company's accounting for this acquisition is preliminary and fair value estimates for the assets acquired and liabilities assumed and the Company's estimates and assumptions are subject to change as the Company obtains additional information for its estimates during the measurement period. During the measurement period, if the Company obtains new information regarding facts and circumstances that existed as of the Closing Date that, if known, would have resulted in revised estimated values of those assets or liabilities, the Company will accordingly revise its estimates of fair values and purchase price allocation. The effect of measurement period adjustments on the estimated fair value elements will be reflected as if the adjustments had been made as of the Closing Date. The impact of all changes that do not qualify as measurement period adjustments will be included in current period earnings.

The Company expects to finalize its purchase price allocation within one year of the Closing Date. The Company continues to analyze and assess relevant information necessary to determine, recognize and record at fair value the assets acquired and liabilities assumed. Examples of areas that rely on preliminary estimates subject to measurement period adjustments include intangibles, lease asset and liability and deferred income tax assets and liabilities. The Company is in the process of obtaining additional market research that may inform the fair value of the acquired intangible assets and additional analysis that may be informative in the determination of the fair value of lease asset and other information. Accordingly, the preliminary recognition and measurement of assets acquired and liabilities assumed as of Closing Date are subject to change.

Purchase Price Consideration


	As Initially Reported		Measurement Period Adjustments		As Adjusted
Cash consideration	$	304,194	$	1,341	$	305,535
Estimated fair value of contingent consideration	115,700		(40,900)		74,800
Estimated total purchase consideration	$	419,894	$	(39,559)	$	380,335

Cash consideration to Seller - net of cash acquired (1)	$	297,200	$	1,341	$	298,541

(1) Represents total purchase price, less cash and cash equivalents acquired, and contingent consideration liabilities. Measurement period

adjustment reflects additional payments made to Seller following the Closing date for working capital adjustments on the purchase price

consistent with the Agreement

The Company paid the Seller $297.2 million in cash at the Closing Date. As of December 31, 2020, the Company paid the Seller an additional $1.3 million for working capital adjustment on the purchase price consistent with the Agreement resulting in an increase to the original cash consideration paid to the Seller.

Contingent Consideration

In addition to the cash paid to the Seller, contingent payments of up to $230 million are also due to the Seller upon the achievement of certain milestones related to the development of SPN-830, the IPR&D asset, and sale of the Products. The possible outcomes for the contingent consideration range from $0, if no milestone is achieved, to $230.0 million, if all milestones are achieved on an undiscounted basis.

The estimated fair value of the $130 million regulatory and developmental contingent consideration payments was estimated using the probability weighted cash flow income approach. Under this method, fair value is estimated by applying a probability assumption to each milestone payment, and then consolidating the probability payments to be discounted under a discounted cash flow method as of the date each payment is expected to be made. In addition to the discount rate, the more significant inputs and assumptions considered include estimated probability and timing of milestone achievement, such as the probability and timing of obtaining regulatory approval. The resulting probability weighted cash flows were discounted at a rate commensurate with the level of risk associated with the projected cash flows.

The estimated fair value of the $100 million sales-based contingent consideration payments was estimated using a Monte Carlo simulation. In addition to the discount rate and the estimated revenue volatility, the more significant inputs and assumptions considered include the estimated amount and timing of projected revenues from the Products. The projected revenues were discounted at a rate commensurate with the level of risk associated with the projected cash flows.

The Company initially recorded a contingent consideration liability of $115.7 million as of the Closing Date to reflect the estimated fair value of the contingent consideration based on information available at that time. Subsequent to the Closing Date, the Company adjusted the contingent consideration fair value based on new information related to the facts and circumstances that existed as of the acquisition date related to the timing of meeting the conditions of the milestone payments that are contingent upon regulatory approval and commercial launch of the acquired IPR&D asset as well as the estimated timing of projected revenues from the Products. This resulted in a measurement period adjustment of $40.9 million, and decreased the estimated fair value of the contingent consideration liability as of Closing Date to $74.8 million.

The fair value measurement of the contingent consideration liability was determined based on significant unobservable inputs and thus represents a Level 3 fair value measurement. These significant unobservable inputs include: the discount rates; the estimated probability and timing of milestone achievement including regulatory milestones related to the IPR&D asset; the estimated amount and timing of projected revenues from the Products; and the estimated revenue volatilities. Significant judgment is employed in determining the appropriateness of these inputs. Changes to the inputs described above could have a material impact on the Company's financial position and results of operations in any given period. The Company believes the assumptions are representative of those a market participant would use in estimating the fair value of the contingent considerations.

Fair Value of Net Assets Acquired

The following table presents the Company’s preliminary estimates of the fair value of the assets acquired and liabilities assumed as of the Closing Date and subsequent measurement period adjustments recorded during the year ended December 31, 2020 (dollars in thousands):


	As Initially Reported		Measurement Period Adjustments		As Adjusted
Cash and cash equivalents	$	6,994	$	—	$	6,994
Accounts receivable	18,474		—		18,474
Inventories (1)	10,400		(700)		9,700
Prepaid expenses and other current assets	3,564		—		3,564
Property and equipment	454		—		454
Finance lease asset (2)	22,747		—		22,747
Intangible assets (1)	387,000		(32,000)		355,000
Other assets	340		—		340
Total of assets acquired	449,973		(32,700)		417,273
Accounts payable	(2,573)		—		(2,573)
Accrued expenses and other current liabilities	(23,339)		—		(23,339)
Finance lease liability (2)	(22,747)		—		(22,747)
Deferred income tax liabilities, net (3)	(69,515)		3,325		(66,190)
Total liabilities assumed	(118,174)		3,325		(114,849)
Total identifiable net assets	$	331,799	$	(29,375)	$	302,424
Goodwill	88,095		(10,184)		77,911
Total purchase price (4)	$	419,894	$	(39,559)	$	380,335

(1) Measurement period adjustments to intangible assets and inventory are primarily due to update in inputs and assumptions based on information related to the facts and circumstances that existed as of the acquisition date.

(2) Refer to Note 10 for further discussion of the acquired finance lease asset and assumed lease liability.

(3) Includes tax attributes that are subject to tax limitations. Measurement period adjustment is primarily due to the tax impact of the changes

in the initial estimate of the fair value of intangible assets and inventories.

(4) Measurement period adjustments include an adjustment to the fair value of the contingent consideration net of the additional cash payment

made to the Seller.

Acquired Inventory

The estimated fair value of the inventory was determined using the comparative sales method, which estimated the expected sales price of the product, reduced by all costs expected to be incurred to complete or to dispose of the inventory, as well as a profit on the sale. The Company recorded a measurement period adjustment of $0.7 million. The Company made refinements to the inputs and assumptions pertaining to the estimate of acquired inventories' obsolescence based on review of product dating information.

Acquired Intangible Assets

The acquired intangible assets include the acquired IPR&D asset related to the apomorphine infusion pump product candidate and the acquired developed technology, and product rights. The Company determined the estimated fair value of the acquired intangible assets as of the Closing Date using the income approach. This is a valuation technique based on the market participant's expectations of the cash flows that the intangible assets are forecasted to generate. The cash flows were discounted at

a rate commensurate with the level of risk associated with the projected cash flows. The Company believes the assumptions are representative of those a market participant would use in estimating fair value.

The fair value measurements of the acquired intangible assets were determined based on significant unobservable inputs and thus represents a Level 3 fair value measurement. Some of the more significant inputs and assumptions used in the intangible assets valuation includes: the timing and probability of success of clinical and regulatory approvals for the IPR&D asset, the estimated future cash flows from product sales, the timing and projection of costs and expenses, discount rates and tax rates.

The Company initially recorded a fair value of intangible assets of $387 million, which consisted of $150 million related to the acquired IPR&D and $237 million related to acquired developed technology and product rights. The initial estimate of the fair value of intangible assets recorded as of the Closing Date is based on information available at that time. During the year ended December 31, 2020, the Company recorded measurement period adjustments of $32 million, which adjusted the initial estimated fair value of the intangible assets to $355 million as of the Closing Date. The Company updated assumptions with respect to the timing of regulatory approval and the commercialization of the acquired IPR&D asset. In addition, the Company also made refinements on the estimates of projected cash flows based on review of terms of the contractual arrangements associated with the Products acquired. The revisions were based on updated assumptions and information related to the facts and circumstances that existed as of the acquisition date.

The following table summarizes the preliminary purchase price allocation and the preliminary average remaining useful lives for identifiable intangible assets (dollars in thousands):


	Estimated Fair Value		Estimated Useful Lives as of Closing Date (in years)
Acquired In-process Research & Development	$	123,000	n/a
Acquired Developed Technology and Product Rights	232,000		10.5 - 12.5
Total intangible assets	$	355,000

Acquired intangible assets, excluding the acquired IPR&D, will be amortized over their estimated useful lives on a straight-line basis. IPR&D assets are considered indefinite-lived, until the successful completion or abandonment of the associated research and development efforts.

Goodwill

Goodwill was calculated as the excess of the consideration paid consequent to completing the acquisition, compared to the net assets recognized. Goodwill represents the future economic benefits arising from the acquired assets, and which could not be individually identified and separately valued. Goodwill is primarily attributable to the additional acquired growth platforms and an expanded revenue base. Goodwill is not expected to be deductible for tax purposes.

Acquisition-related Transaction Costs

Acquisition-related transaction costs, which primarily consisted of regulatory, financial advisory, and legal fees, totaled $8.4 million and $1.7 million for the year ended December 31, 2020, and December 31, 2019, respectively, were included in Selling, general and administrative expense, in the consolidated statements of earnings.

Revenues and Net Earnings of MDD Enterprises, LLC

The operations of MDD US Enterprises, LLC (formerly USWM Enterprises, LLC) and its subsidiaries have been included in the Company's consolidated statements of earnings for the period after the Closing Date through December 31, 2020. Total revenues of $91.0 million and net earnings of $9.9 million were recorded for the year ended December 31, 2020.

Pro forma Information

The following table presents the unaudited pro forma combined financial information for each of the periods presented as if the USWM Acquisition had occurred on January 1, 2019 (dollars in thousands):


	December 31,
	2020		2019
	(unaudited)
Pro forma total revenues	$	583,657	$	542,807
Pro forma net earnings	133,423		110,842

The unaudited pro forma combined financial information is based on historical financial information and the Company's preliminary allocation of the purchase price; therefore, it is subject to subsequent adjustment upon finalizing the purchase price allocation. In order to reflect the occurrence of the acquisition as if it occurred on January 1, 2019, the unaudited pro forma combined financial information reflects the adoption of ASC 842, Leases; the recognition of additional amortization expense on intangible assets, the removal of historical amortization charges and the elimination of non-recurring acquisition-related cumulative transaction costs of $10.1 million.

The unaudited pro forma combined financial information should not be considered indicative of the results that would have occurred if the acquisition had been consummated on the assumed completion date, nor are they indicative of future results.

Disaggregated Revenues

12 Months Ended

Dec. 31, 2020

Disaggregation of Revenue [Abstract]

Disaggregated Revenues

The following table summarizes the disaggregation of revenues by product or source (dollars in thousands):


	Years Ended December 31,
	2020		2019		2018
Net product sales
Trokendi XR	$	319,640	$	295,214	$	315,295
Oxtellar XR	98,725		88,186		84,576
APOKYN	74,296		—		—
XADAGO	6,943		—		—
MYOBLOC	9,746		—		—
Total net product sales	509,350		383,400		399,871
Royalty revenues	11,047		9,355		8,276
Licensing revenues	—		—		750
Total revenues	$	520,397	$	392,755	$	408,897

Trokendi XR accounted for more than 60% of the Company’s total net product sales in 2020 and more than 70% in 2019 and 2018.

The Company recognized noncash royalty revenue of $8.5 million, $6.9 million, and $5.9 million for the years ended December 31, 2020, 2019, and 2018, respectively, consequent to the Company's agreement with HC Royalty (see Note 2).

During 2020, the Company recorded a $10.7 million adjustment to its estimated provision for product returns related to prior year sales. The adjustment, which accounts for the majority of the total adjustments related to prior year net product sales of $13.8 million in 2020, was due to unfavorable actual returns experienced in the first quarter of 2020 for discontinued Trokendi XR commercial blister pack configurations, for which all production and distribution ceased in 2017. As a result, the Company changed its estimated provision for product returns, based on the most recent experience.

Adjustments related to prior year net product sales were $13.8 million, which included the $10.7 million aforementioned adjustment for discontinued Trokendi XR configuration, against $509.4 million of net product sales in 2020 and $0.4 million against $383.4 million of net product sales in 2019.For the year ended December 31, 2020, revenues recognized from performance obligations related to prior periods (for example, due to changes in transaction price) on royalty revenues were not material in the aggregate.

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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-Subparagraph (b)(2)
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 12
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-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130554-203045

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Fair Value of Financial Instruments

Fair Value of Financial Instruments

12 Months Ended

Dec. 31, 2020

Fair Value Disclosures [Abstract]

The fair value of an asset or liability represents the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between unrelated market participants.

The Company reports the fair value of assets and liabilities using a three level measurement hierarchy that prioritizes the inputs used to measure fair value. The three levels of inputs used to measure fair value are as follows:

•Level 1—Inputs are unadjusted quoted prices in active markets for identical assets. The Company has the ability to access these prices as of the measurement date. Level 1 assets include: cash held at banks; certificates of deposit; money market funds; investment grade corporate debt securities; and U.S. government agency and municipal debt securities.

•Level 2—Level 2 securities are valued using third-party pricing sources that apply relevant inputs and data in their models to estimate fair value. Inputs are quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; inputs other than quoted prices, but that are observable for the asset or liability (e.g., interest rates; yield curves); and inputs that are derived principally from or corroborated by observable market data by correlation or by other means (i.e., market corroborated inputs). Level 2 assets include: investment grade corporate debt securities; U.S. government agency and municipal debt securities; other fixed income securities; and SERP (Supplemental Executive Retirement Plan) assets. The fair value of the restricted marketable securities is recorded in Other assets on the consolidated balance sheets.

•Level 3—Unobservable inputs that reflect the Company’s own assumptions. These are based on the best information available, including the Company’s own data.

There were no level 3 assets as of December 31, 2020, or December 31, 2019.

Financial Assets Recorded at Fair Value

The Company’s financial assets that are required to be measured at fair value on a recurring basis are as follows (dollars in thousands):


			Fair Value Measurements as of December 31, 2020
	Total Fair value at December 31, 2020		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)
Assets:
Cash and cash equivalents
Cash	$	218,550	$	218,550	$	—
Money market funds	70,090		70,090		—
Marketable securities
Corporate debt securities	133,893		—		133,893
Long term marketable securities
Corporate debt securities	350,359		256		350,103
Other noncurrent assets
Marketable securities - restricted (SERP)	547		3		544
Total assets at fair value	$	773,439	$	288,899	$	484,540


			Fair Value Measurements as of December 31, 2019
	Total Fair Value at December 31, 2019		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)
Assets:
Cash and cash equivalents
Cash	$	78,912	$	78,912	$	—
Money market funds	102,469		102,469		—
Marketable securities
Corporate debt securities	165,527		—		165,527
Municipal debt securities	165		—		165
Long term marketable securities
Corporate debt securities	571,828		254		571,574
U.S. government agency and municipal debt securities	19,945		—		19,945
Other noncurrent assets
Marketable securities - restricted (SERP)	418		3		415
Total assets at fair value	$	939,264	$	181,638	$	757,626

The carrying amounts of other financial instruments, including accounts receivable, accounts payable, and accrued expenses, approximate fair value due to their short-term maturities.

Unrestricted available-for-sale marketable securities held by the Company are as follows (dollars in thousands):


	December 31, 2020		December 31, 2019
Corporate and U.S. government agency and municipal debt securities
Amortized cost	$	472,306	$	747,598
Gross unrealized gains	11,987		10,031
Gross unrealized losses	(41)		(164)
Total fair value	$	484,252	$	757,465

The contractual maturities of the unrestricted available-for-sale marketable securities held by the Company are as follows (dollars in thousands):


	December 31, 2020
Less than 1 year	$	133,893
1 year to 2 years	132,480
2 years to 3 years	129,743
3 years to 4 years	88,136
Greater than 4 years	—
Total	$	484,252

There was no impairment on any available-for-sale marketable securities as of December 31, 2020, and December 31, 2019.

Financial Liabilities Recorded at Fair Value

Contingent Consideration

During the measurement period, changes in fair value due to measurement period adjustments are recorded against goodwill. In each reporting period after the acquisition, the Company remeasures the fair value of the contingent consideration liabilities from the USWM Acquisition and records in its consolidated statements of earnings the increases or decreases in the fair value of the liabilities. The contingent consideration liabilities are measured at fair value on a recurring basis, using the same methodology as of the acquisition date. The Company classifies the contingent consideration liabilities under Level 3 because the inputs and assumptions used in estimating fair value may not be observable in the market. These reflect the assumptions the Company believes would be made by a market participant. Refer to Note 3, USWM Acquisition, for further discussion of significant inputs and assumptions used for the valuation of the contingent consideration as of the acquisition date. Changes in any of those inputs together or in isolation may result in significantly lower or higher fair value measurement.

The following table provides the reconciliation of contingent consideration liabilities balance as of December 31, 2020 (dollars in thousands):


Balance at December 31, 2019	$	—
Initial estimate of contingent consideration at Closing Date	115,700
Measurement period adjustment	(40,900)
Change in fair value recognized in earnings	1,900
Balance at December 31, 2020	$	76,700

Refer to Note 3 for further discussion on measurement period adjustments on the fair value at the Closing Date of the contingent consideration liability related to the USWM Acquisition.

During the year ended December 31, 2020, the Company recorded an increase to the contingent consideration liabilities of $1.9 million. Correspondingly, the change in fair value is reported in Contingent consideration expense in the consolidated

statement of earnings for the year ended December 31, 2020. The increase in the fair value remeasurement of contingent consideration liabilities was primarily due to the changes made in the assumptions on the expected timing of the achievement of milestones and changes to the estimate of projected revenues that did not qualify as measurement period adjustments.

Financial Liabilities Recorded at Carrying Value

The following table sets forth the carrying value and fair value of the Company’s financial liabilities that are not carried at fair value (dollars in thousands):


	December 31, 2020				December 31, 2019
	Carrying Value		Fair Value (Level 2)		Carrying Value		Fair Value (Level 2)
Convertible notes, net	$	361,751	$	383,381	$	345,170	$	366,023

The fair value has been estimated based on actual trading information, and quoted prices, both provided by bond traders.

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.

Convertible Senior Notes Due 2023

Convertible Senior Notes Due 2023

12 Months Ended

Dec. 31, 2020

Debt Disclosure [Abstract]

The 0.625% Convertible Senior Notes Due 2023 (2023 Notes), issued in March 2018, bear interest at an annual rate of 0.625%, payable semi-annually in arrears on April 1 and October 1 of each year. The 2023 Notes will mature on April 1, 2023, unless earlier converted or repurchased by the Company. The Notes are being amortized to interest expense at an effective interest rate of 5.41% over the contractual term of the 2023 Notes. The Company may not redeem the 2023 Notes at its option before maturity. The total principal amount of 2023 Notes is $402.5 million.

The 2023 Notes were issued pursuant to an Indenture between the Company and Wilmington Trust, National Association, as trustee. The Indenture includes customary terms and covenants, including certain events of default upon which the 2023 Notes may be due and payable immediately. The Indenture does not contain any financial or operating covenants or any restrictions on the payment of dividends, the issuance of other indebtedness, or the issuance or repurchase of securities by the Company.

Noteholders may convert their 2023 Notes at their option only in the following circumstances: (1) during any calendar quarter, if the last reported sale price per share of the Company's common stock for at least 20 trading days (whether or not consecutive) during the 30 consecutive trading days ending on, and including the last trading day of the immediately preceding calendar quarter, exceeds 130% of the conversion price, or a price of approximately $77.13 per share on such trading day; (2) during the five consecutive business days immediately after any 10 consecutive trading day period (such 10 consecutive trading day period, the "measurement period") in which the trading price per $1,000 principal amount of Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price per share of the Company's common stock on such trading day and the conversion rate on such trading day; (3) upon the occurrence of certain corporate events or distributions on the Company's common stock, as specified in the Indenture; and (4) at any time from and including October 1, 2022, until the close of business on the second scheduled trading day immediately before the maturity date.

At its election, the Company will settle conversions by paying or delivering, as applicable, cash, shares of the Company’s common stock, or a combination of cash and shares of the Company’s common stock, based on the applicable conversion rate. The initial conversion rate is 16.8545 shares per $1,000 principal amount of the 2023 Notes, which represents an initial conversion price of approximately $59.33 per share, and is subject to adjustment as specified in the Indenture. In the event of conversion, if converted in cash, the holders would forgo all future interest payments, any unpaid accrued interest, and the possibility of further stock price appreciation.

If a “make-whole fundamental change,” as defined in the Indenture, occurs, then the Company will, in certain circumstances, increase the conversion rate for a specified period of time. If a “fundamental change,” as defined in the Indenture, occurs, then noteholders may require the Company to repurchase their 2023 Notes at a cash repurchase price equal to the principal amount of the 2023 Notes to be repurchased, plus accrued and unpaid interest, if any.

Contemporaneous with the issuance of the 2023 Notes, the Company also entered into separate privately negotiated convertible note hedge transactions (collectively, the Convertible Note Hedge Transactions) with each of the call spread

counterparties. The Company issued 402,500 convertible note hedge options. In the event that shares or cash are deliverable to holders of the 2023 Notes upon conversion at limits defined in the Indenture, counterparties to the convertible note hedges will be required to deliver up to approximately 6.8 million shares of the Company’s common stock or to pay cash to the Company in a similar amount as the value that the Company delivers to the holders of the 2023 Notes, based on a conversion price of $59.33 per share.

Concurrently with entering into the Convertible Note Hedge Transactions, the Company also entered into separate privately negotiated warrant transactions (collectively, the Warrant Transactions) with each of the call spread counterparties. The Company issued a total of 6,783,939 warrants. The warrants entitle the holder to one share per warrant. The strike price of the Warrant Transactions will initially be $80.9063 per share of the Company’s common stock and is subject to adjustment.

The Convertible Note Hedge Transactions are expected to reduce the potential dilution of the Company’s common stock upon conversion of the 2023 Notes, and/or offset any potential cash payments the Company is required to make in excess of the principal amount of converted 2023 Notes, as the case may be.

The Warrant Transactions were intended to partially offset the cost to the Company of the purchased Convertible Note Hedge Transactions; however, the Warrant Transactions could have a dilutive effect with respect to the Company’s common stock, to the extent that the market price per share of the Company’s common stock, as measured under the terms of the Warrant Transactions, exceeds the strike price of the warrants.

The liability component of the 2023 Notes consists of the following (dollars in thousands):


	December 31, 2020		December 31, 2019
2023 Notes	$	402,500	$	402,500
Unamortized debt discount and deferred financing costs	(40,749)		(57,330)
Total carrying value	$	361,751	$	345,170

No 2023 Notes were converted as of December 31, 2020, or December 31, 2019.

Stockholders' Equity

12 Months Ended

Dec. 31, 2020

Share-based Payment Arrangement [Abstract]

Stockholders' Equity

Common Stock

The holders of the Company's common stock are entitled to one vote for each share of common stock held.

Stock Option Plan

The Company has adopted the Supernus Pharmaceuticals, Inc. 2012 Equity Incentive Plan, as amended (the 2012 Plan), which is stockholder approved. This plan provides for the grant of stock options and certain other equity awards, including: stock appreciation rights (SARs); restricted and unrestricted stock; stock units; performance awards; cash awards; and other awards that are convertible into or otherwise based on the Company's common stock, to the Company's key employees, directors, consultants, and advisors. The 2012 Plan is administered by the Company's Board of Directors and the Company's Compensation Committee of the Board and provides for the issuance of up to 11 million shares of the Company's common stock. Option awards are granted with an exercise price equal to the closing price of the Company's common stock as of the grant date. Option awards granted to employees, consultants and advisors generally vest in four equivalent annual installments, starting on the first anniversary of the grant's date. Awards have 10 year contractual terms. Option awards granted to the directors generally vest over a one year term and have a 10 year contractual term.

Employee Stock Purchase Plan

The Company has adopted the Supernus Pharmaceuticals, Inc. 2012 Employee Stock Purchase Plan, as amended (the ESPP). The ESPP allows eligible employees the opportunity to acquire shares of the Company's common stock at periodic intervals through accumulated payroll deductions. These deductions are applied at the semi-annual purchase dates of June 30 and December 31 to purchase shares of common stock at a discount. Eligible employees may purchase shares at the lower of 85% of the fair market value at either the first day of the purchase period or the fair market value at the end of the purchase period. The ESPP provides for the issuance of up to 1.7 million shares of the Company's common stock. The Company records compensation expense related to its ESPP.

Share-based Compensation

Share-based compensation expense is as follows (dollars in thousands):


	Years Ended December 31,
	2020		2019		2018
Research and development	$	2,431	$	2,599	$	1,943
Selling, general and administrative	14,130		12,247		9,348
Total	$	16,561	$	14,846	$	11,291

The fair value of each option award is estimated on the date of the grant, using the Black-Scholes option-pricing model and the assumptions in the following table:


	Years Ended December 31,
	2020	2019	2018
Fair value of common stock	$21.13 - $23.99	$22.99 - $37.78	$37.20 - $58.15
Expected volatility	61.56% - 62.27%	61.36% - 63.28%	57.95% - 60.56%
Dividend yield	0%	0%	0%
Expected term	5.72 years - 6.54 years	5.53 years - 6.18 years	6.25 years
Risk-free interest rate	0.27% - 1.34%	1.69% - 2.55%	2.69% - 2.85%

As of December 31, 2020, the total unrecognized compensation expense was approximately $25.5 million. The Company expects to prospectively recognize these expenses over a weighted-average period of 2.52 years.

Stock Option and Stock Appreciation Rights

The following table summarizes stock option and stock appreciation rights (SAR) activities:


	Number of Options	Weighted- Average Exercise Price		Weighted-Average Remaining Contractual Term (in years)	Aggregate Intrinsic Value (in thousands)
Outstanding , December 31, 2018	3,916,963	$	19.98	7.10	$	57,220
Granted	880,235	$	36.43
Exercised	(114,753)	$	12.90
Forfeited	(75,886)	$	34.80
Outstanding, December 31, 2019	4,606,559	$	23.06	6.66	$	27,716
Granted	1,370,225	$	23.55
Exercised	(204,373)	$	11.47
Forfeited	(320,549)	$	29.09
Outstanding, December 31, 2020	5,451,862	$	23.26	6.28	$	29,877
As of December 31, 2020
Vested and expected to vest	5,451,862	$	23.26	6.28	$	29,877
Exercisable	3,218,771	$	19.36	4.77	$	27,832

The weighted-average grant date fair value of options granted for the years ended December 31, 2020, 2019, and 2018 was $13.44, $21.50, and $23.43 per share, respectively.

The aggregate intrinsic value of shares exercised for the years ended December 31, 2020, 2019, and 2018 was $2.3 million, $2.4 million, and $36.3 million, respectively. Proceeds from the option exercise for the years ended December 31, 2020, 2019, and 2018 was $2.3 million, $1.5 million, $9.4 million, respectively.

The total fair value of the underlying common stock related to shares that vested during the years ended December 31, 2020, 2019, and 2018 was approximately $14.1 million, $10.8 million, and $8.3 million, respectively.

Restricted Stock Units

During the year ended December 31, 2020, the Company granted 26,055 RSUs, with a weighted average grant date fair value per share of $23.99. These RSUs generally vest one year from the date of grant. All RSUs are unvested as of December 31, 2020. The total unrecognized compensation expense was $0.2 million as of December 31, 2020. The Company expects to prospectively recognize these expenses over a weighted-average period of 0.4 years.

Performance Stock Units

Performance-Based Awards

During the year ended December 31, 2020, the Company granted 31,250 performance-based awards, with a weighted average grant date fair value per share of $21.35. These awards require certain performance targets to be achieved in order to vest. Vesting is also subject to continued service requirements through the date that the achievement of the performance target is certified. As of December 31, 2020, all of the performance-based awards were vested and issued as shares outstanding. There was no unrecognized compensation expense as of December 31, 2020. The total fair value of vested PSU during the year ended December 31, 2020, was $0.7 million.

Market-Based Awards

During the year ended December 31, 2020, the Company granted 15,625 market-based awards, with a weighted average grant date fair value per share of $23.41. These awards are subject to achievement of market-based performance targets in order to

vest. All of the 15,625 market-based awards were unvested as of December 31, 2020. There was no unrecognized compensation expense as of December 31, 2020. The Company used a Monte-Carlo Simulation to determine the fair value and expected term of the award. The expected term of the award was 0.85 years.

Earnings per Share

12 Months Ended

Dec. 31, 2020

Earnings Per Share [Abstract]

Earnings per Share

Basic earnings per share (EPS) is calculated using the weighted-average number of common shares outstanding. Diluted EPS is calculated using the weighted-average number of common shares outstanding, including the dilutive effect of the Company’s stock option grants, SARs, RSUs, warrants, employee stock purchase plan (ESPP) awards, and the 2023 Notes, as determined per the treasury stock method.

Effect of Convertible Notes and Related Convertible Note Hedges and Warrants

In connection with the issuance of the 2023 Notes, the Company entered into Convertible Note Hedge and Warrant Transactions as described further in Note 6, Convertible Senior Notes Due 2023. The expected collective impact of the Convertible Note Hedge and Warrant Transactions is to reduce the potential dilution that would occur if the price of the Company's common stock was between the conversion price of $59.33 per share and the strike price of the warrants of $80.9063 per share.

The 2023 Notes and related Convertible Note Hedge and Warrant Transactions are excluded in the calculation of diluted EPS because inclusion would be anti-dilutive. Specifically, the denominator of the diluted EPS calculation excludes the additional shares related to the 2023 Notes and warrants because the average price of the Company's common stock was less than the conversion price of the 2023 Notes of $59.33 per share, as well as less than the strike price of the warrants, $80.9063 per share. Prior to actual conversion, the Convertible Note Hedge Transactions are not considered in calculating diluted earnings per share, as their impact would be anti-dilutive.

In addition to the above described effect of the 2023 Notes and the related Convertible Note Hedge and Warrant Transactions, the Company also excluded the common stock equivalents of the following outstanding stock-based awards in the calculation of diluted EPS because their inclusion would be anti-dilutive.


	Years Ended December 31,
	2020	2019	2018
Stock options, RSUs, PSUs	2,888,785	1,145,446	199,982

The following table sets forth the computation of basic and diluted net earnings per share for the years ended December 31, 2020, 2019, and 2018 (dollars in thousands, except share and per share amounts):


	Years Ended December 31,
	2020		2019		2018
Numerator, dollars in thousands:
Net earnings	$	126,950	$	113,056	$	110,993

Denominator:
Weighted average shares outstanding, basic	52,615,269		52,412,181		51,989,824
Effect of dilutive securities:
Stock options, RSUs and SARs	1,074,474		1,404,573		2,109,048
Weighted average shares outstanding, diluted	53,689,743		53,816,754		54,098,872

Earnings per share, basic	$	2.41	$	2.16	2.13
Earnings per share, diluted	$	2.36	$	2.10	2.05

Income Taxes Expense

12 Months Ended

Dec. 31, 2020

Income Tax Disclosure [Abstract]

Income Tax Expense

Income Taxes Expense

The summary of the income tax expense (benefit) for the years ended December 31, 2020, 2019, and 2018 is as follows (dollars in thousands):


	Years Ended December 31,
	2020		2019		2018
Current
Federal	$	29,893	$	29,333	$	26,772
State	11,234		10,930		5,621
Deferred
Federal	2,200		(4,551)		(2,450)
State	(1,629)		(1,281)		(760)
Total income tax expense	$	41,698	$	34,431	$	29,183

A reconciliation of income tax expense at the U.S. federal statutory income tax rate to annual income tax expense at the Company's effective tax rate is as follows (dollars in thousands):


	Years Ended December 31,
	2020		2019		2018
Income tax expense computed at U.S. federal statutory income tax rate	$	35,417	$	30,972	$	29,437
State income taxes	7,281		7,543		3,674
Permanent items	2,654		1,332		(2,196)
Research and development credits	(3,602)		(2,071)		(3,199)
Uncertain income tax position	348		(2,992)		716
Other	(400)		(353)		751
Income tax expense	$	41,698	$	34,431	$	29,183

The significant components of the Company's deferred income tax assets (liabilities) are as follows (dollars in thousands):


	As of December 31,
	2020		2019
Deferred tax assets:
Convertible bond hedge	$	12,420	$	17,197
Accrued product returns and rebates	17,529		15,123
Accrued compensation and stock based compensation	13,547		10,349
Non-recourse liability related to sale of future royalties	3,777		5,320
Research and development credit carryforwards	3,151		3,817
Amortization of intangibles	—		4,617
Net operating loss carryforwards	13,164		2,245
Operating lease liability	14,542		8,187
Other	5,303		2,510
Total deferred tax assets	83,433		69,365
Less: valuation allowance	(582)		(11)
Total deferred tax asset, net of valuation allowance	82,851		69,354
Deferred tax liabilities:
Amortization of intangibles	(79,545)		—
Debt discount on 2023 Notes	(10,190)		(14,109)
Patent infringement legal costs	(10,897)		(10,613)
Operating lease assets	(10,674)		(5,237)
Depreciation	(3,458)		(2,778)
IRC Section 481(a) liability	(315)		(2,126)
Unrealized gain on marketable securities	(2,987)		(2,428)
Total deferred tax liabilities	(118,066)		(37,291)
Net deferred tax (liabilities) assets	$	(35,215)	$	32,063

In assessing the realizability of deferred income tax assets, the Company considers whether it is more-likely-than-not that some or all of the deferred income tax assets will not be realized. The ultimate realization of the deferred income tax assets is dependent upon the generation of future taxable income during the periods in which the net operating loss (NOL) and tax credit carryforwards are available. The Company considers projected future taxable income, the scheduled reversal of deferred income tax liabilities, and available tax planning strategies that can be implemented by the Company in making this assessment. Based upon the level of historical taxable income and projections for future taxable income over the periods in which the NOL and credit carryforwards are available to reduce income taxes payable, the Company had determined it is more-likely-than-not to realize such net deferred tax assets.

Associated with the acquisition of MDD US Enterprises, LLC (formerly USWM Enterprises, LLC), the Company recorded a valuation allowance of $0.6 million and $0.6 million as of the acquisition date and December 31, 2020, respectively, related to the foreign net operating losses and certain state charitable contribution carryforwards that are not expected to be realizable in the future.

The Company has NOL and other tax credit carryforwards in several jurisdictions. Due to changes in the Company's ownership, the utilization of net operating loss carryforwards and research and development credit carryforwards, that can be used to offset future taxable income, are subject to annual limits in accordance with Internal Revenue Code (IRC) provisions, as well as similar state provisions. In addition, states may also impose other future limitations through state legislation or similar measures. Despite the NOL carryforwards, the Company may incur higher state income tax expense in the future.

As of December 31, 2020, the U.S. federal and state NOL carryforwards amounted to approximately $57.9 million and $21.9 million, respectively, and will expire in various years beginning in 2023. For the year ended December 31, 2020, the Company utilized federal NOLs of approximately $6.4 million and state NOLs of approximately $13.6 million. The Company expects the remaining federal and state NOL carryforwards to become available in the future years.

As of December 31, 2020, the Company has available research and development credit carryforwards of $3.5 million, which will become available in 2021 and will expire, if unused, starting in 2027.

The Company is no longer subject to U.S. Federal income tax examinations for years prior to 2017. Operating loss or tax credit carryforwards generated prior to 2017 may be subject to tax audit adjustment.

The Company accounts for uncertain income tax positions pursuant to the guidance in ASC Topic 740, Income Taxes. The Company recognizes interest and penalties related to uncertain tax positions, if any, in income tax expense. Some uncertain income tax position liabilities have been recorded against the Company's deferred income tax assets to offset such tax attribute carryforwards and other positions that cannot be offset by tax attributes until liability has been booked.

A reconciliation of the beginning and ending amount of gross unrecognized tax benefits is as follows (dollars in thousands):


	Years Ended December 31,
	2020		2019		2018
Balance as of January 1	$	5,978	$	8,848	$	8,859
Gross increases related to current year tax positions	1,027		208		1,108
Gross increases related to prior year tax positions	221		—		—
Gross decreases related to prior year tax positions	—		(49)		(484)
Lapse of statute of limitations	(1,345)		(3,029)		(635)
Balance as of December 31	$	5,881	$	5,978	$	8,848

The Company recorded $0.6 million, $3.0 million, and $0.6 million of net tax benefit in 2020, 2019 and 2018, respectively, as a result of the expiration of statutes of limitation. The Company also recorded $0.3 million, $0.2 million, and $0.3 million for uncertain tax positions related to research and development tax credits in 2020, 2019, and 2018, respectively, and an additional expense of $0.2 million related to a prior year position. The Company does not anticipate a material impact to the financial statements in the next 12 months as a result of uncertain tax positions and expiring statutes of limitation.

On March 27, 2020, President Trump signed into law the Coronavirus Aid, Relief and Economic Security Act (CARES Act). The CARES Act is an emergency economic stimulus package that includes spending and tax incentives to strengthen the U.S. economy and fund a nationwide effort to curtail the effect of the COVID-19 pandemic. While the CARES Act provides sweeping tax changes in response to the COVID-19 pandemic, some of the more significant provisions which are expected to impact the Company’s financial statements include the removal of certain limitations on the utilization of net operating losses, increasing the ability to deduct interest expense, and amending certain provisions of the previously enacted Tax Cuts and Jobs Act.

As of December 31, 2020, the Company expects that these provisions will not have a material impact, as the Company does not have net operating losses that would fall under the provisions of this legislation, nor does it expect interest expense to be limited. The ultimate impact of the CARES Act may differ from this estimate due to changes in interpretations and assumptions, additional guidance that may be issued, and actions the Company may take in response to the CARES Act. The Company will continue to assess the impact that various provisions may have on its business.

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

Property, Plant and Equipment [Abstract]

Leases

12 Months Ended

Dec. 31, 2020

Leases [Abstract]

Leases

Operating Leases

The Company has operating leases for its former headquarters office and lab space at 1550 East Gude Drive in Rockville, MD, its new headquarters lease, and its fleet vehicles. The Company’s leases for its former headquarters office and lab space ended in April 2020. With respect to the fleet vehicle leases, given the volume of individual leases involved in the overall arrangement, the Company applies a portfolio approach to effectively account for the operating lease assets and liabilities. The Company also elected to combine the lease and non-lease components for the fleet vehicle and headquarters leases.

Headquarters Lease

The Company entered into a lease agreement, effective January 31, 2019, with Advent Key West, LLC (Landlord), for its new headquarters in Rockville, MD (Premises). The term of the new headquarters lease commenced on February 1, 2019 (the Commencement Date) and will continue until April 30, 2034, unless earlier terminated in accordance with the terms of the lease. The lease includes options to extend the lease for up to 10 years. Fixed rent with respect to the Premises began on the Commencement Date; however, the Landlord agreed to a rent abatement from the Commencement Date through April 30, 2020.

The initial fixed rental rate is approximately $195,000 per month for the first 12 months and will automatically increase by 2% on each anniversary of the Commencement Date. Under the terms of the Lease, the Company provided a security deposit and will be required to pay all utility charges for the Premises in addition to its pro rata share of any operating expenses and real estate taxes.

The lease also provides for a tenant improvement allowance of $10.2 million in aggregate. All tenant improvement allowances have been utilized as of December 31, 2019.

Finance Lease

Contemporaneous with the USWM Acquisition, USWM Enterprises adopted ASC 842, Leases. USWM Enterprises had an existing contract manufacturing agreement with Merz Pharma GmbH & Co. KGaA (Merz) for the manufacture and supply of MYOBLOC, NeuroBloc and NerBloc (finished products). Pursuant to the Merz Agreement, Merz agreed to provide a dedicated manufacturing facility that included a stand-alone building, dedicated cleanroom suites, dedicated manufacturing, and purification equipment, and filling and packaging production lines (collectively, the manufacturing facility) to manufacture finished products. The Merz Agreement will expire in July 2027 unless the Company and Merz mutually agree to extend the terms. The Merz Agreement may not be terminated for convenience.

Under the terms of the agreement, the Company is required to purchase a minimum quantity of finished products on an annual basis. This minimum purchase requirement represents the in-substance fixed contract consideration associated with the dedicated manufacturing facility. Refer to Note 21, Commitments and Contingencies.

As of the Closing Date, the finance ROU lease asset and corresponding ROU lease liability relating to the dedicated manufacturing facility was $22.7 million. The ROU lease asset and ROU lease liability represent the present value of estimated future payments; i.e., the minimum purchase obligations as of the Closing Date.

The embedded lease is preliminarily classified as a finance lease. The in-substance fixed contract consideration was allocated to the lease component since the Company has preliminarily elected not to separate lease and non-lease components. Refer to Note 3 for further discussion of the USWM Acquisition.

The Company recognized $1.9 million of fixed lease costs on the finance lease for the year ended December 31, 2020. Purchases of MYOBLOC in excess of the annual minimum purchase obligations will be recorded as variable lease cost. There were no purchases made during the year in excess of the annual minimum purchase obligations.

Operating and finance lease assets and lease liabilities as reported on the consolidated balance sheets are as follows (dollars in thousands):


		December 31,
	Balance Sheet Classification	2020		2019
Assets
Operating lease assets	Other assets	$	20,231	$	21,279
Finance lease asset	Property and equipment, net	20,874		—
Total lease assets		$	41,105	$	21,279

Liabilities
Lease liabilities, current
Operating lease liabilities, current portion	Accounts payable and accrued liabilities	$	3,760	$	2,825
Finance lease liability, current portion	Other current liabilities	3,761		—
Lease liabilities, long term
Operating lease liabilities, long term	Operating lease liabilities, long term	28,579		30,440
Finance lease liability, long term	Other liabilities	20,235		—
Total lease liabilities		$	56,335	$	33,265

The components of operating and finance lease costs are as follows (dollars in thousands):


	December 31,
	2020		2019
Operating lease cost:
Fixed lease cost	$	5,333	$	4,990
Variable lease cost	2,145		1,887
Total	$	7,478	$	6,877

Finance lease cost:
Amortization on finance lease asset	$	1,873	$	—
Interest on lease liability	333		—
Total	$	2,206	$	—

Supplemental cash flow information related to leases is as follows (dollars in thousands):


	December 31,
	2020		2019
Cash paid for operating leases	$	6,949	$	5,337
Cash paid for finance lease	802		—
Lease assets and tenant receivables obtained for new operating leases	2,478		35,594
Lease assets obtained for new finance lease	22,747		—

Weighted average lease term, and weighted average discount rate for operating and finance leases as of December 31, 2020, are as follows:


Operating leases
Weighted-average remaining lease term (years)	11.7
Weighted-average discount rate	4.33	%
Finance lease
Weighted-average remaining lease term (years)	6.4
Weighted-average discount rate	2.47	%

Future minimum lease payments under noncancellable operating and finance leases as of December 31, 2020, are as follows (dollars in thousands):


	Operating Leases		Finance Lease
Year ending December 31:
2021	$	5,066	$	3,946
2022	4,474		3,665
2023	2,701		3,665
2024	2,587		3,665
2025	2,638		3,665
Thereafter	24,145		7,329
Total future minimum lease payments	$	41,611	$	25,935
Less: Imputed interest (1)	(9,272)		(1,939)
Present value of lease liabilities	$	32,339	$	23,996

(1) Calculated using the interest rate for each lease.

Lessee, Finance Leases

Leases

Operating Leases

Headquarters Lease

The lease also provides for a tenant improvement allowance of $10.2 million in aggregate. All tenant improvement allowances have been utilized as of December 31, 2019.

Finance Lease

Operating and finance lease assets and lease liabilities as reported on the consolidated balance sheets are as follows (dollars in thousands):


		December 31,
	Balance Sheet Classification	2020		2019
Assets
Operating lease assets	Other assets	$	20,231	$	21,279
Finance lease asset	Property and equipment, net	20,874		—
Total lease assets		$	41,105	$	21,279

Liabilities
Lease liabilities, current
Operating lease liabilities, current portion	Accounts payable and accrued liabilities	$	3,760	$	2,825
Finance lease liability, current portion	Other current liabilities	3,761		—
Lease liabilities, long term
Operating lease liabilities, long term	Operating lease liabilities, long term	28,579		30,440
Finance lease liability, long term	Other liabilities	20,235		—
Total lease liabilities		$	56,335	$	33,265

The components of operating and finance lease costs are as follows (dollars in thousands):


	December 31,
	2020		2019
Operating lease cost:
Fixed lease cost	$	5,333	$	4,990
Variable lease cost	2,145		1,887
Total	$	7,478	$	6,877

Finance lease cost:
Amortization on finance lease asset	$	1,873	$	—
Interest on lease liability	333		—
Total	$	2,206	$	—

Supplemental cash flow information related to leases is as follows (dollars in thousands):


	December 31,
	2020		2019
Cash paid for operating leases	$	6,949	$	5,337
Cash paid for finance lease	802		—
Lease assets and tenant receivables obtained for new operating leases	2,478		35,594
Lease assets obtained for new finance lease	22,747		—

Weighted average lease term, and weighted average discount rate for operating and finance leases as of December 31, 2020, are as follows:


Operating leases
Weighted-average remaining lease term (years)	11.7
Weighted-average discount rate	4.33	%
Finance lease
Weighted-average remaining lease term (years)	6.4
Weighted-average discount rate	2.47	%

Future minimum lease payments under noncancellable operating and finance leases as of December 31, 2020, are as follows (dollars in thousands):


	Operating Leases		Finance Lease
Year ending December 31:
2021	$	5,066	$	3,946
2022	4,474		3,665
2023	2,701		3,665
2024	2,587		3,665
2025	2,638		3,665
Thereafter	24,145		7,329
Total future minimum lease payments	$	41,611	$	25,935
Less: Imputed interest (1)	(9,272)		(1,939)
Present value of lease liabilities	$	32,339	$	23,996

(1) Calculated using the interest rate for each lease.

Accounts Receivable	12 Months Ended
Accounts Receivable	Dec. 31, 2020
Receivables [Abstract]
Accounts Receivable	Accounts ReceivableAs of December 31, 2020, and December 31, 2019, the Company recorded allowances of approximately $11.4 million and $11.0 million, respectively, for prompt pay discounts and contractual service fees paid to the Company’s customers. The Company's customers are primarily pharmaceutical wholesalers and distributors, and specialty pharmacies.

Inventories

12 Months Ended

Dec. 31, 2020

Inventory Disclosure [Abstract]

Inventories

Inventories consist of the following (dollars in thousands):


	December 31, 2020		December 31, 2019
Raw materials	$	22,208	$	4,582
Work in process	8,985		11,428
Finished goods	17,132		10,618
Total	$	48,325	$	26,628

As of December 31, 2020, the Company capitalized $19.1 million of pre-launch inventory costs for SPN-812. As of December 31, 2019, the Company had not capitalized any pre-launch inventory costs.

Inventories include the acquired inventories from the USWM Acquisition. Refer to Note 3 for further discussion of the USWM Acquisition.

Investments in Unconsolidated VIEs	12 Months Ended
Investments in Unconsolidated VIEs	Dec. 31, 2020
Equity Method Investments and Joint Ventures [Abstract]
Investments in Unconsolidated VIEs	Investments in Unconsolidated VIEs In April 2020, the Company entered into a Development and Option Agreement (Development Agreement) with Navitor Pharmaceuticals, Inc. (Navitor). The Company can terminate the Development Agreement upon 30 days’ notice. Under the terms of the Development Agreement, the Company and Navitor will jointly conduct a Phase II clinical program for NV-5138 (SPN-820) for treatment-resistant depression. The Company will bear all of Phase I and Phase II development costs incurred by either party, up to a maximum of $50 million. In addition, the Company will incur certain other research and development support costs. There are certain additional payment amounts which the Company could incur. These costs are contingent upon Navitor achieving defined development milestones. The Company has an option to acquire or license NV-5138 (SPN-820), for which additional payments would be required. The Company paid Navitor a one time, nonrefundable, and non-creditable fee of $10 million for the option to acquire or license NV-5138 (SPN-820). This expense is included in Research and development expense in the consolidated statement of earnings for the year ended December 31, 2020. In addition to entering into the Development Agreement, the Company acquired Series D Preferred Shares of Navitor for $15 million, representing an approximately 13% ownership position in Navitor. The Company has determined that Navitor is a VIE. The Company has not consolidated this VIE because the Company lacks the power to direct the activities that most significantly impact Navitor’s economic performance. This investment is accounted for under the practical expedient allowed for equity securities without readily determinable fair value, which is cost minus impairment plus any changes in observable price changes from an orderly transaction of similar investments of Navitor. The investment is recorded in Other assets in the consolidated balance sheets. As of December 31, 2020, the carrying value of our investment in Navitor was approximately $15 million. The maximum exposure to losses related to Navitor is limited to: the $15 million carrying value of the investment; a maximum of approximately $50 million in expense for Phase I and Phase II development of NV-5138 (SPN-820); and the cost of other development and formulation activities provided by the Company. We have provided no financing to Navitor other than the amounts committed under the Development Agreement.

Property and Equipment

12 Months Ended

Dec. 31, 2020

Property and Equipment

Property and equipment consists of the following (dollars in thousands):


	December 31, 2020		December 31, 2019
Lab equipment and furniture	$	12,526	$	11,053
Leasehold improvements	15,183		14,217
Software	2,295		2,225
Finance lease assets (1)	22,747		—
Computer equipment	2,113		1,839
Construction-in-progress	—		433
	54,864		29,767
Less accumulated depreciation and amortization	(17,040)		(12,699)
Total	$	37,824	$	17,068

(1) Refer to Note 10, Leases.

Depreciation and amortization expense on property and equipment was approximately $4.3 million, $1.5 million, and $1.9 million for the years ended December 31, 2020, 2019 and 2018, respectively.

As of December 31, 2020, there were no identified indicators of impairment.

Goodwill and Intangible Assets, Net

12 Months Ended

Dec. 31, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets, Net

Goodwill

Goodwill represents the excess of the USWM Acquisition purchase price over the fair value of the tangible and identifiable intangible net assets acquired. The following table sets forth the reconciliation of the goodwill balance as of December 31, 2020 (dollars in thousands):


	December 31, 2020
Balance at December 31, 2019	$	—
Initial estimate of Goodwill at Closing Date	88,095
Measurement period adjustment	(10,184)
Balance at December 31, 2020	$	77,911

In 2020, the Company recorded cumulative measurement period adjustments to the fair value of intangibles, inventory, and contingent consideration liability that resulted in a corresponding adjustment of $10.2 million to the initial estimate of

goodwill recorded at Closing Date. Refer to Note 3 for further discussion of these measurement period adjustments related to the USWM Acquisition.

As of December 31, 2020, there were no identified indicators of impairment.

Intangible assets, net

Intangible assets include: patent defense costs, which are deferred legal fees incurred in conjunction with defending patents for Oxtellar XR and Trokendi XR; acquired developed technology and product rights, and an acquired IPR&D asset associated with the USWM acquisition. The Company amortizes intangible assets over their useful lives, except for the acquired IPR&D asset.

The following table sets forth the gross carrying amounts and related accumulated amortization of intangible assets (dollars in thousands):


	Remaining Weighted- Average Life (Years)	December 31, 2020		December 31, 2019
Acquired In-process Research & Development		$	123,000	$	—
Intangible assets subject to amortization
Acquired Developed Technology and Product Rights	10 - 12	232,000		—
Capitalized patent defense costs	2.00 - 6.25	43,579		43,375
Less accumulated amortization		(34,237)		(18,535)
Total intangible assets, net		$	364,342	$	24,840

U.S. patents covering Oxtellar XR and Trokendi XR will expire no earlier than 2027. As regards Trokendi XR, the Company entered into settlement agreements that allow third parties to enter the market by January 1, 2023, or earlier under certain circumstances.

Amortization expense for intangible assets was approximately $15.7 million, $5.2 million, and $5.2 million for the years ended December 31, 2020, 2019, and 2018, respectively.

Anticipated annual amortization expense for intangible assets in 2021 and 2022 is estimated at $24.2 million per year. Anticipated annual amortization expense for intangible assets from 2023 to 2025 is estimated at $21.4 million per year.

As of December 31, 2020, there were no identified indicators of impairment.

Accounts Payable and Accrued Liabilities

12 Months Ended

Dec. 31, 2020

Payables and Accruals [Abstract]

Accounts Payable and Accrued Liabilities

Accounts payable and accrued liabilities consist of the following (dollars in thousands):


	December 31, 2020		December 31, 2019
Accrued compensation	$	16,008	$	11,223
Accrued royalties (1)	13,890		—
Accrued clinical trial costs (2)	12,842		13,285
Inventory-related accruals	9,587		1,095
Accrued professional fees	7,730		3,936
Accounts payable	6,147		10,141
Operating lease liabilities portion (3)	3,760		2,825
Income taxes payable	—		2,443
Other accrued expenses	8,970		4,766
Total	$	78,934	$	49,714

(1) Refer to Note 21, Commitments and Contingencies.

(2) Includes preclinical and all clinical trial-related costs.

(3) Refer to Note 10, Leases.

Accrued Product Returns and Rebates

12 Months Ended

Dec. 31, 2020

Accrued Product Returns and Rebates

Accrued Product Returns and Rebates

Accrued product returns and rebates consist of the following (dollars in thousands):


	December 31, 2020		December 31, 2019
Accrued product rebates	$	96,589	$	88,811
Accrued product returns	29,603		18,818
Total	$	126,192	$	107,629

Other Liabilities

12 Months Ended

Dec. 31, 2020

Other Liabilities Disclosure [Abstract]

Other Liabilities

Other liabilities consist of the following (dollars in thousands):


	December 31, 2020		December 31, 2019
Nonrecourse liability related to sale of future royalties, long term	$	13,410	$	19,248
Finance lease liability, long term (1)	20,235		—
Other liabilities	9,146		9,409
Total	$	42,791	$	28,657

(1) Refer to Note 10, Leases.

Other (Expense) Income

12 Months Ended

Dec. 31, 2020

Other Income and Expenses [Abstract]

Other (Expense) Income

Other (expense) income consists of the following (dollars in thousands):


	Years Ended December 31,
	2020		2019		2018
Interest and other income, net	$	18,704	$	21,623	$	13,843
Interest expense	(19,435)		(18,207)		(13,840)
Interest expense on nonrecourse liability related to sale of future royalties	(4,319)		(4,500)		(4,271)
Total	$	(5,050)	$	(1,084)	$	(4,268)

Interest expense includes noncash interest expense related to amortization of deferred financing costs and amortization of the debt discount on the 2023 Notes, in the amount of $16.6 million, $15.7 million, and $11.8 million for the years ended December 31, 2020, 2019 and 2018, respectively (see Note 6).

Interest income includes interest earned from cash, cash equivalents, and marketable securities of $16.0 million, $21.3 million, and $13.8 million for the years ended December 31, 2020, 2019, and 2018, respectively.

Employee Benefit Plan	12 Months Ended
Employee Benefit Plan	Dec. 31, 2020
Retirement Benefits [Abstract]
Employee Benefit Plan	Employee Benefit PlanOn January 2, 2006, the Company established the Supernus Pharmaceuticals, Inc. 401(k) Profit Sharing Plan (the 401(k) Plan) for its employees under Section 401(k) of the IRC. Under the 401(k) Plan, all full-time employees who are at least 18 years old are eligible to participate in the 401(k) Plan. Employees may participate starting on the first day of the month following employment. Employees may contribute up to the lesser of 90% of eligible compensation, or the applicable limit, as established by the Code.The Company matches 100% of a participant's contribution for the first 3% of their salary deferral and matches 50% of the next 2% of their salary deferral. As determined by the Board, the Company may elect to make a discretionary contribution not exceeding 60% of the annual compensation paid to all participating employees. The Company's contributions to the 401(k) Plan were approximately $2.6 million, $2.3 million, and $2.1 million for the years ended December 31, 2020, 2019, and 2018, respectively.

The entire disclosure for retirement benefits.

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Schedule of customers that represent more than 10% of total revenue and more than 10% of accounts receivable, net

Commitments and Contingencies	12 Months Ended
Commitments and Contingencies	Dec. 31, 2020
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies Product Licenses The Company has obtained exclusive licenses from third parties for proprietary rights to support the product candidates in the Company’s CNS portfolio. Under these license agreements, the Company may be required to pay certain amounts upon the achievement of defined milestones. If these products are ultimately commercialized, the Company is also obligated to pay royalties to third parties, computed as a percentage of net product sales, for each respective product under a license agreement. Through the USWM Acquisition, the Company acquired licensing agreements with other pharmaceutical companies for APOKYN, XADAGO, and MYOBLOC. The Company is obligated to pay royalties to third parties, computed as a percentage of net product sales, for each of the products under the respective license agreements. The royalty expense incurred for these acquired products is recognized as Cost of goods sold in the consolidated statement of earnings. Royalty Agreement In the third quarter of 2014, the Company received a $30.0 million pursuant to a Royalty Interest Acquisition Agreement related to the purchase by HC Royalty of certain of the Company’s rights under the Company’s agreement with United Therapeutics related to the commercialization of Orenitram (treprostinil) Extended-Release Tablets. Full ownership of the royalty rights will revert to the Company if and when a certain cumulative payment threshold is reached (see Note 2, Note 4, and Note 18). USWM Enterprise Commitments Assumed As part of the USWM Acquisition, the Company assumed the remaining commitments of USWM Enterprises and its subsidiaries, which are discussed below. In addition to the annual minimum purchase requirement of MYOBLOC, amounting to an estimated €3.0 million annually, under the contract manufacturing agreement with Merz for manufacture and supply, USWM Enterprises had an existing license and distribution agreement for XADAGO. This included an annual minimum promotional spend to support the marketing of XADAGO for the first five years of the agreement. As of December 31, 2020, the total remaining contractual commitment through 2020 is $3.7 million. (See Note 3, USWM Acquisition for further discussion on the USWM Acquisition and Note 10, Leases for further discussion on the finance lease related to the Merz Agreement). In March 2019, MDD US Operations, LLC (formerly US WorldMeds, LLC) and its subsidiary, Solstice Neurosciences, LLC (US) (collectively, the MDD Subsidiaries) entered into a Corporate Integrity Agreement (CIA) with the Office of Inspector General of the U.S. Department of Health and Human Services. Under the CIA, the MDD Subsidiaries agreed to and paid $17.5 million to resolve U.S. Department of Jus

Summary of Significant Accounting Policies (Policies)	12 Months Ended
Summary of Significant Accounting Policies (Policies)	Dec. 31, 2020
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation The Company's consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (U.S. GAAP). The Company, which is primarily located in the United States (U.S.), operates in one operating segment. Reclassifications Certain prior year amounts in the consolidated balance sheets, statements of cashflows, and statements of earnings have been reclassified to conform to the current year presentation, including a reclassification made to present amortization of intangible assets separately. This was previously included in Selling, general and administrative expenses and now is recorded as a component of Amortization of intangible assets on the consolidated statements of earnings. These reclassifications did not affect operating earnings or other consolidated financial statements for the years ended December 31, 2020, 2019, and 2018. Consolidation The Company’s consolidated financial statements include the accounts of: Supernus Pharmaceuticals, Inc.; Supernus Europe Ltd.; Biscayne Neurotherapeutics, Inc. and its wholly owned subsidiary; MDD US Enterprises, LLC (formerly USWM Enterprises, LLC) and its wholly owned subsidiaries. These are collectively referred to herein as “Supernus” or “the Company.” All significant intercompany transactions and balances have been eliminated in consolidation. The consolidated financial statements reflect the consolidation of entities in which the Company has a controlling financial interest. In determining whether there is a controlling financial interest, the Company considers if it has a majority of the voting interests of the entity, or if the entity is a variable interest entity (VIE) and if the Company is the primary beneficiary. In determining the primary beneficiary of a VIE, the Company evaluates whether it has both: the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance; and the obligation to absorb losses of, or the right to receive benefits from the VIE that could potentially be significant to that VIE. The Company's judgment with respect to its level of influence or control of an entity involves the consideration of various factors, including the form of an ownership interest; representation in the entity’s governance; the size of the investment; estimates of future cash flows; the ability to participate in policymaking decisions; and the rights of the other investors to participate in the decision making process, including the right to liquidate the entity, if applicable. If the Company is not the primary beneficiary of the VIE, and an ownership interest is maintained in the entity, the interest is accounted for under the equity or cost methods of accounting, as appropriate. The Company continuously assesses whether it is the primary beneficiary of a VIE as changes to existing relationships or future transactions may affect its conclusions.
Use of Estimates	Use of Estimates The Company bases its estimates on historical experience; various forecasts; information received from its service providers; information from other sources, including public and proprietary sources; and other assumptions that the Company believes are reasonable under the circumstances. Actual results could differ materially from the Company’s estimates. The Company periodically evaluates the methodologies employed in making its estimates on an ongoing basis. The extent to which the COVID-19 pandemic may directly or indirectly impact our business, financial condition and results of operations is highly uncertain and subject to change. As a result, certain of our estimates and assumptions, including the provision for sales deductions, the creditworthiness of customers entering into revenue arrangements, the valuation of the assets and liabilities acquired in the USWM Acquisition, and the fair values of our financial instruments, require increased judgment and carry a higher degree of variability and volatility that could result in material changes to our estimates in future periods.
Cash and Cash Equivalents	Cash and Cash Equivalents The Company considers all investments in highly liquid financial instruments with an original maturity of three months or less to be cash equivalents.
Marketable Securities	Marketable Securities Marketable securities consist of investments in U.S. Treasury bills and notes; bank certificates of deposit; various U.S. government agency debt securities; corporate and municipal debt securities; and other fixed income securities. The Company places all investments with governmental, industrial, or financial institutions whose debt is rated as investment grade. The Company's investments are classified as available-for-sale and are carried at fair value. The Company classifies all available-for-sale marketable securities with maturities greater than one year from the balance sheet date as non-current assets. Any unrealized holding gains or losses on debt securities, including their tax effect, are reported as components of Other comprehensive earnings (loss) in the consolidated statement of comprehensive earnings. Realized gains and losses, included in Interest and other income, net in the consolidated statement of earnings, are determined using the specific identification method for determining the cost of securities sold. The Company adopted Accounting Standards Update (ASU) No. 2016-13, Financial Instruments - Credit Losses (Topic 326) on January 1, 2020, using the allowance approach. Declines in fair value below amortized cost related to credit losses (i.e., impairment due to credit losses) are included in the consolidated statement of earnings, with a corresponding allowance established. If the estimate of expected credit losses decreases in subsequent periods, the Company will reverse the credit losses through current period earnings and adjust the allowance accordingly. Refer to Recently Issued Accounting Pronouncements in this Note 2.
Business Combinations and Contingent Considerations	Business Combinations and Contingent Considerations In determining whether an acquisition should be accounted for as a business combination or as an asset acquisition, the Company makes certain judgments regarding whether the acquired set of activities and assets meets the definition of a business. Significant judgment is required in assessing whether the acquired processes or activities, along with their inputs, would be substantive to constitute a business, as defined by U.S. GAAP. If the acquired set of activities and assets does not meet the definition of a business, the transaction is accounted for as an asset acquisition. In an asset acquisition, any acquired research and development that does not have an alternative future use is charged to expense as of the acquisition date, and no goodwill is recorded. If the acquired set of activities and assets meets the definition of a business, the Company applies the acquisition method of accounting and accounts for the transaction as a business combination. In a business combination, assets acquired and liabilities assumed are recorded at their respective fair values as of the acquisition date. The excess of the purchase price over the fair value of the acquired net assets, if applicable, is recorded as goodwill. The Company accounted for the USWM Acquisition as a business combination. In a business combination, the operating results of the acquired business are included in the Company’s consolidated statement of earnings, beginning on the effective acquisition date. Acquisition-related expenses are recognized separately from the business combination and are expensed as incurred. Significant judgment is involved in the determination of the fair value assigned to assets acquired and liabilities assumed in a business combination, as well as the estimated useful lives of assets. These estimates can materially affect our consolidated results of operations and financial position. The fair value of intangible assets, including acquired in-process research and development (IPR&D), are determined using information available as of the acquisition date and are based on estimates and assumptions that are deemed reasonable by management. Significant estimates and assumptions include but are not limited to: the probability of regulatory approval, revenue growth, and appropriate discount rate. Depending on the facts and circumstances, the Company may deem it necessary to engage an independent valuation expert to assist in valuing significant assets and liabilities. While the Company uses its best estimates and assumptions to accurately value assets acquired and liabilities assumed as of the acquisition date, estimates are inherently uncertain and subject to refinement. As a result, during the measurement period, which may be up to one year from the acquisition date, the Company may record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. Uncertain tax positions and tax-related valuation allowances are initially recorded in connection with a business combination as of the acquisition date. The Company continues to collect information related to facts and circumstances existing as of the acquisition date and evaluate these estimates and assumptions. The Company records any adjustments to the Company’s preliminary estimates to goodwill based on the facts and circumstances existing as of the acquisition date (measurement period adjustments). Upon the conclusion of the measurement period, any subsequent adjustments are recorded to our consolidated statements of earnings in the period that these adjustments are identified. Contingent Considerations The USWM Acquisition involved potential future payments contingent upon the achievement of certain milestones primarily related to the development and commercial sale of the acquired IPR&D, SPN-830 (apomorphine infusion pump), including product development milestones and sales-based milestone payments on future product sales. The fair value of the contingent consideration liability is determined as of the acquisition date using estimated or forecast inputs. These inputs include the estimated amount and timing of projected revenues, probability and timing of milestone achievement, probability of IPR&D achieving regulatory approval, revenue volatility, and the estimated discount rates and risk-free rate used to present value the probability-weighted cash flows. Subsequent to the acquisition date, at each reporting period prior to the resolution of the contingency, the contingent consideration liability is remeasured at current fair value, with changes recorded in earnings in the period of remeasurement. The determination of the initial and subsequent fair value of the contingent consideration liability requires significant judgment by management. Changes in any of the inputs not related to facts and circumstances existing as of the acquisition date may result in a significant fair value adjustment, which can impact the results of operations in the period in which the adjustment is made. Changes that are not measurement period adjustments are reported on the consolidated statement of earnings in Contingent consideration expense. Additional information regarding the USWM Acquisition is included in Note 3, USWM Acquisition.
Accounts Receivable, net	Accounts Receivable, Net Accounts receivable are reported on the consolidated balance sheets at outstanding amounts due from customers, less an allowance for doubtful accounts, sales discounts, and sales allowances. The Company extends credit without requiring collateral. The Company writes off uncollectible receivables when the likelihood of collection is remote. The Company evaluates the collectability of accounts receivable on a regular basis. An allowance, when needed, is based upon various factors, including: the financial condition and payment history of customers; an overall review of collections experience on other accounts; and economic factors or events expected to affect future collections experience. Payment terms for receivables are based on customary commercial terms and are predominantly less than one year.
Concentration of Credit Risk	Concentration of Credit Risk Financial instruments that potentially subject the Company to credit risk concentrations consist of cash, cash equivalents, marketable securities, and accounts receivable. The counterparties are various corporations, governmental institutions, and financial institutions of high credit standing. Substantially all of the Company's cash, cash equivalents, and marketable securities are maintained in U.S. government agency debt and debt of well-known, investment grade corporations. Deposits held with banks may exceed the amount of governmental insurance provided on such deposits. Generally, these deposits may be redeemed upon demand, and therefore, these bear minimal default risk. Refer to Note 4, Disaggregated Revenues, for the concentration of net product sales.
Inventories	Inventories Inventories are recorded at the lower of cost or net realizable value, include materials, labor, direct costs and indirect costs. These are valued using the first-in, first-out method. The Company writes down inventory that has become obsolete or has a cost basis in excess of its expected net realizable value. Expired inventory is destroyed, and the related costs are recognized as Cost of goods sold in the consolidated statement of earnings. Inventories Produced in Preparation of Product Launches The Company capitalizes inventories produced in preparation for product launches when future commercialization of a product is probable and when a future economic benefit is expected to be realized. The determination to capitalize is based on the particular facts and circumstances relating to the product. Capitalization of such inventory begins when the Company determines that (i) positive clinical trial results have been obtained in order to support regulatory approval; (ii) uncertainties regarding regulatory approval have been significantly reduced; and (iii) it is probable that these capitalized costs will provide a future economic benefit in excess of capitalized costs. In evaluating whether these conditions are met, the Company considers the following factors: the product candidate’s current status in the regulatory approval process; results from the related pivotal and supportive clinical trials; results from meetings with relevant regulatory agencies prior to the filing of regulatory applications; completion of the regulatory applications; consequent acceptance by the regulatory agency; potential impediments to the approval process such as product safety or efficacy concerns, potential labeling restrictions, and other impediments: historical experience with manufacturing and commercializing similar products as well as the manufacture of the relevant product candidate; and the Company’s manufacturing environment, and supply chain in determining logistical constraints that could hamper approval or commercialization. In assessing the economic benefit that the Company is likely to realize, the Company considers the shelf life of the product in relation to the expected timeline for approval; patent related or contractual issues that may prevent or delay commercialization and product stability data of all pre-approval production to assess the adequacy of expected shelf life; viability of commercialization taking into account competitive dynamics in the marketplace and market acceptance; and anticipated future sales and anticipated reimbursement strategies that may prevail with respect to the product, to determine product profit margin. In applying the lower of cost or net realizable value to pre-launch inventory, the Company estimates a range of likely commercial prices based on the pricing of competitive commercial products and pre-launch discussions with managed care providers. The Company could be required to write down previously capitalized costs related to pre-launch inventories upon a change in facts and circumstances, including, among other potential factors, a denial or significant delay of approval by regulatory bodies, a delay in commercialization, or other adverse factors.
Intangible Assets	Intangible Assets Intangible assets consist of definite-lived intangible assets: acquired developed technology and product rights, and patent defense costs, and an indefinite-lived intangible asset: acquired IPR&D. Patent defense costs are legal fees that have been incurred in connection with legal proceedings related to the defense of patents for Oxtellar XR and Trokendi XR. Patent defense costs are charged to expense in the event of an unsuccessful litigation outcome. Definite-lived intangible assets are carried at cost less accumulated amortization, with amortization calculated on a straight line basis over the estimated useful lives of the assets. The Company evaluates the estimated remaining useful life of its intangible assets annually, or when events or changes in circumstances warrant a revision to the remaining periods of amortization. Acquired IPR&D in a business combination is considered an indefinite-lived intangible asset until the completion or abandonment of the associated research and development efforts. Upon successful completion of the project, the Company will determine as to the then-useful life of the intangible asset. This is generally determined as the period over which the substantial majority of the cash flows are expected to be generated. The capitalized amount is then amortized over its estimated useful life. If a project is abandoned, all remaining capitalized amounts are written off immediately. During the period prior to completion or abandonment, the IPR&D asset is not amortized but tested for impairment on an annual basis or when potential indicators of impairment are identified.
Impairment of Long-Lived Assets and Impairment of Indefinite-Lived Intangible Assets	Impairment of Long-Lived Assets Long-lived assets consist primarily of property and equipment, operating and finance lease assets, and definite-lived intangible assets. The Company assesses the recoverability of its long-lived assets with definite lives whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If indications of impairment exist, projected future undiscounted cash flows associated with the asset would be compared to the carrying value of the asset to determine whether the asset's value is recoverable. If impairment is determined, the Company writes down the asset to its estimated fair value and records an impairment loss equal to the excess of the carrying value of the long-lived asset over its estimated fair value in the period at which such a determination is made. Impairment of Indefinite-Lived Intangible Assets For indefinite-lived intangible assets, such as the acquired IPR&D asset, the Company evaluates impairment annually in the fourth quarter or more frequently if impairment indicators exist. The annual evaluation is generally based on an assessment of qualitative factors to determine whether it is more likely than not that the fair value of the asset is less than its carrying amount. The Company considers various factors including but is not limited to significant or adverse changes in the legal and regulatory environment, adverse clinical trial results, significant trial delays, inability to obtain governmental approval, inability to commercialize a product candidate the introduction or advancement of competitive products, and product candidates, or other events that indicate it is more likely than not that fair value is less than its carrying value. If the Company is unable to conclude whether the indefinite-lived intangible asset is not impaired after considering the totality of events and circumstances during its qualitative assessment, the Company performs a quantitative assessment by estimating the fair value of the indefinite-lived intangible asset and comparing the fair value to the carrying amount. If the carrying amount of the indefinite-lived intangible asset exceeds its fair value, the Company writes down the indefinite-lived intangible asset to its estimated fair value, and an impairment loss equal to the difference between the assets fair value and carrying value is recognized in the consolidated statement of earnings in the period at which such determination is made. Evaluating for goodwill impairment requires judgment, including evaluating current economic and competitive circumstances, estimating future cash flows, future growth rates, future profitability, and the expected life over which projected cash flows would occur.
Goodwill and Goodwill Impairment Assessment	Goodwill and Goodwill Impairment Assessment Goodwill is calculated as the excess of the consideration paid consequent to completing an acquisition compared to the net assets recognized in a business combination. Goodwill represents the future economic benefits from the other acquired assets that could not be individually identified and separately quantified. The Company evaluates goodwill for possible impairment at least annually (during the fourth quarter of each fiscal year), or more often, if and when events and circumstances indicate that goodwill may be impaired. The annual evaluation is generally based on an assessment of qualitative factors to determine whether it is more likely than not that the fair value of the asset is less than its carrying amount. This includes but is not limited to significant adverse changes in the business climate, market conditions, or other events that indicate that it is more likely than not that the fair value of the reporting unit is less than its carrying value. If the Company is unable to conclude whether the goodwill is not impaired after considering the totality of events and circumstances during its qualitative assessment, the Company performs a quantitative assessment by estimating the fair value of the reporting unit and comparing the fair value to the carrying amount. If the carrying amount of the reporting unit exceeds its fair value, the Company writes down the goodwill to the estimated fair value, and an impairment loss equal to the difference is recognized in the consolidated statement of earnings in the period at which such determination is made. Evaluating for impairment requires judgment, including identifying reporting units and estimating future cash flows. The Company estimates the fair values of its reporting unit using discounted cash flow models or other valuation models, such as comparative transactions or market multiples.
Interest Expense	Interest Expense Interest expense includes stated interest and the amortization of deferred financing costs and debt discount incurred by the Company in connection with the issuance of $402.5 million of 0.625% Convertible Senior Notes due 2023, (see Note 6). The Company amortizes the deferred financing costs and debt discount over the term of the debt, using the effective interest method.
Revenue Recognition	Revenue Recognition The Company recognizes revenue in an amount that reflects the consideration the Company expects to receive in exchange for those goods or services. The Company does not adjust revenue for any financing effects in transactions where the Company expects the period between the transfer of the goods or services and collection to be less than one year. No contract assets or liabilities were recorded as of December 31, 2020, or 2019. Revenue from Product Sales The Company’s customers are primarily pharmaceutical wholesalers, specialty pharmacies, and pharmaceutical distributors. Customers purchase product to fulfill orders from retail pharmacy chains and independent pharmacies of varying size and purchasing power. The Company recognizes gross revenue when its products are shipped from a third party fulfillment center and physically received by its customers. The Company's customers take control of its products, including title and ownership, upon the physical receipt of its products at their facilities. Customer orders are generally fulfilled within a few days of order receipt, resulting in minimal order backlog. There are no minimum product purchase requirements with our customers. The Company recognizes revenue from product sales in an amount that reflects the consideration the Company expects to ultimately receive in exchange for those goods. Product sales are recorded net of various forms of variable consideration, including: provision for estimated rebates; provision for estimated future product returns; and an estimated provision for discounts. These are collectively considered "sales deductions." As described below, variability in the net transaction price for the Company’s products arises primarily from the aforementioned sales deductions. Significant judgment is required in estimating certain sales deductions. In making these estimates, the Company considers: historical experience; product price increases; current contractual arrangements under applicable payor programs; unbilled claims; processing time lags for claims; inventory levels in the wholesale, specialty pharmacy, and retail distribution channel; and product life cycle. The Company adjusts its estimates of revenue either when the most likely amount of consideration it expects to receive changes, or when the consideration becomes fixed. Variable consideration on product sales is only recognized when it is probable that a significant reversal will not occur. If actual results in the future vary from our estimates, the Company adjusts its estimates in the period identified. These adjustments could materially affect net product sales and earnings in the period in which the adjustment(s) is recorded. Sales Deductions The Company records product sales net of the following sales deductions: Rebates: Rebates are discounts which the Company pays under either public sector or private sector health care programs. Rebates paid under public sector programs are generally mandated under law, whereas private sector rebates are generally contractually negotiated by the Company with managed care providers. Both types of rebates vary over time. Public sector rebate programs encompass: various Medicaid drug rebate programs; Medicare gap coverage programs; programs covering public health service institutions; and programs covering government entities. All federal employees and agencies purchase drugs under the Federal Supply Schedule. Private sector rebate programs include: contractual agreements with managed care providers, under which the Company pays fees to gain access to that provider’s patient drug formulary; and Company-sponsored programs, under which the Company defrays or eliminates patient co-payment charges that the patient would otherwise be obligated to pay to their managed care provider in order to fill their prescription. Rebates are owed upon dispensing our product to a patient; i.e., filling a prescription. The accrual balance for rebates consists of the following three components. First, because rebates are generally invoiced and paid in arrears, the accrual balance consists of an estimate of the amount expected to be incurred for prescriptions dispensed in the current quarter. Second, the accrual balance also includes an estimate for known or estimated prior quarters’ unpaid rebates, covering those prescriptions dispensed in past quarters but for which no invoice has yet been received. Third, the accrual balance includes an estimate for rebates that will be prospectively owed for prescriptions filled in future quarters. This estimate pertains to a product that has been sold by the Company to wholesalers or distributors and which resides either as wholesaler/distributor inventory or as inventory held at pharmacies. As of the end of the reporting period, this product has not been dispensed to a patient. The Company’s estimates of expected rebate claims vary by program and by type of customer because the period between the date at which the prescription is filled and the date the Company receives and pays the invoice varies substantially. For each of its products, the Company bases its estimates of expected rebate claims on multiple factors, including: historical levels of deductions; contractual terms with managed care providers; actual and anticipated changes in product price; prospective changes in managed care fee for service contracts; prospective changes in co-payment assistance programs; and anticipated changes in program utilization rates; i.e., patient participation rates under each specific program. The Company records an estimated liability for rebates at the time the customer takes title to the product (i.e., at the time of sale to wholesalers/distributors). This liability is recorded as a reduction to gross product sales, and an increase in Accrued product returns and rebates. The liability is recorded as a component of current liabilities on the consolidated balance sheets. The sensitivity of the Company’s estimates to subsequent adjustment varies by program and by type of customer. If actual rebates vary from estimated amounts, the Company adjusts the balances of such accrued rebates to reflect actual experience. These adjustments could materially affect the estimated liability balance, net product sales, and earnings in the period in which these adjustments are made. Returns: Sales of the Company’s products are not subject to a general right of return. A product that has been used to fill patient prescriptions is no longer subject to any right of return. However, the Company will accept a return of product that is damaged or defective when shipped from its third party fulfillment centers. The Company will also accept a return of expired product six months prior to and up to 12 months subsequent to the product’s expiry date for certain products. Expired or defective returned product cannot be re-sold and is therefore destroyed. The Company records an estimated liability for product returns at the time the customer takes title to the product (i.e., at time of sale). The liability is reflected as a reduction to gross product sales, and an increase in Accrued product returns and rebates. This liability is recorded as a component of current liabilities on the consolidated balance sheets. The Company estimates the liability for returns primarily based on the actual returns experience for its commercial products. Because the Company’s products have a shelf life up to 48 months from the date of manufacture, and because the Company accepts return of product up to 12 months post its expiry date, there is a time lag of several years between the time when the product is sold and the time when the Company issues credit on the expired product. The Company’s returns policy generally permits product returns to be processed at the current wholesaler price rather than at historical acquisition price; hence, the Company’s estimated liability for product returns is affected by price increases taken subsequent to the date of sale and prior to its return. At the time the Company adjusts its estimates for product returns, such adjustment affects the estimated liability, product sales, and earnings in the period of adjustment. Those adjustments may be material to our financial results. Sales discounts: Distributors and wholesalers of the Company's pharmaceutical products are generally offered various forms of consideration, including allowances, service fees and prompt payment discounts, for distributing our products. Distributor and wholesaler allowances and service fees arise from contractual agreements and are estimated as a percentage of the price at which the Company sells product to them. In addition, distributors and wholesalers are offered a prompt pay discount for payment within a specified period. Prompt pay discounts are estimated as a percentage of the price at which the Company sells product. The Company accounts for these discounts at the time of sale as a reduction to gross product sales. License Revenue The Company has entered into collaboration agreements to commercialize certain of its products outside of the U.S. Those agreements include the right to use the Company’s intellectual property as a functional license and generally include an up-front license fee and ongoing milestone payments upon the achievement of certain specific events. These agreements may also require minimum royalty payments based on sales of products that use the applicable intellectual property. Up-front license fees are recognized once the license has been executed between the Company and its licensee. Milestones are a form of variable consideration recognized when either the underlying events have transpired (i.e., event-based milestone) or when the sales-based targets have been met by the collaborative partner (i.e., sales-based milestone). Both types of milestone payments are nonrefundable. The Company evaluates whether achieving the milestone is considered probable and estimates the amount of the milestone to be included in the transaction price using the most likely amount method. The value of the associated milestone is not included in the transaction price if it is probable that a significant revenue reversal would occur. This estimation is based on management’s judgment and may require assessing factors that are outside of the Company’s influence, such as: likelihood of regulatory success; availability of third party information; and expected time period until achievement of the event. These factors are evaluated based on the specific facts and circumstances. Event-based milestones are recognized in the period that the related event, such as regulatory approval, occurs. Milestones that are not within the control of the Company, such as approval from regulatory authorities, or where attainment of the specified event is dependent on the success of a third-party, are not considered probable until the specified event occurs. Sales-based milestones are recognized as revenue only when the sales-based target is achieved. There are no guaranteed minimum amounts owed to the Company related to license and collaboration agreements. Royalty Revenue The Company recognizes noncash royalty revenue for amounts earned pursuant to its royalty agreement with United Therapeutics Corporation (United Therapeutics), based on estimated product sales of Orenitram by United Therapeutics (see Note 4). This agreement includes the right to use the Company’s intellectual property as a functional license. In 2014, the Company sold certain of these royalty rights to Healthcare Royalty Partners III, L.P. (HC Royalty) (see Note 21). Consequent to this agreement, the Company recorded a nonrecourse liability related to this transaction and amortizes this liability as noncash royalty revenue. Sales of Orenitram by United Therapeutics result in payments from United Therapeutics to HC Royalty, in accordance with this agreement. The Company also recognizes noncash interest expense related to the nonrecourse liability and accrues interest expense at an estimated effective interest rate (see Note 19). This interest rate is determined based on projections of HC Royalty’s rate of return. Royalty revenue also includes cash royalty amounts received from other collaboration partners, including from Takeda Pharmaceutical Company Ltd., based on net product sales of Takeda's product, Mydayis, in the current period. Royalty revenue is only recognized when the underlying product sale by Takeda has occurred. The Takeda arrangement also includes Takeda's right to use the Company’s intellectual property as a functional license. There are no guaranteed minimum amounts owed to the Company related to any of these royalty revenue agreements.
Cost of Goods Sold	Cost of Goods Sold The cost of goods sold consists primarily of materials; third-party manufacturing costs; freight and distribution costs; direct labor; cost of royalties; cost to write down inventory to net realizable value and manufacturing overhead costs, including quality control and assurance.
Research and Development Expenses	Research and Development Expenses Research and development expenditures are expensed as incurred. These expenses include: employee salaries, benefits, and share-based compensation; cost of contract research and development services provided by third parties; costs for preclinical and clinical studies; cost of acquiring or manufacturing clinical trial materials; regulatory costs; research facilities costs; depreciation expense and allocated occupancy expenses; and license fees and milestone payments related to in-licensed products and technologies. Acquired IPR&D assets that are used for research and development and have no future alternative use are expensed as incurred in-process research and development. The Company estimates preclinical and clinical trial expenses based on services performed pursuant to contracts with research institutions, clinical investigators, clinical research organizations (CROs), and other service providers that perform services on the Company’s behalf. In recording service fees, the Company estimates the cost of those services performed on behalf of the Company during the current period and compares those costs with the cumulative expenses recorded and payments made for such services. As appropriate, the Company accrues additional expense for services that have been delivered or defers nonrefundable advance payments until the related services are performed. If the actual timing of the performance of services or the level of effort varies from our estimate, the Company adjusts its accrued expenses, or its deferred advance payments, accordingly. If the Company subsequently determines that it no longer expects the services associated with a nonrefundable advance payment to be rendered, the remaining portion of that advance payment is charged to expense in the period in which such determination is made.
Share-Based Compensation	Share-Based Compensation Stock Options The Company recognizes share-based compensation expense over the service period, using the straight-line method. Employee share-based compensation for stock options is determined using the Black-Scholes option-pricing model to compute the fair value of option grants as of their grant date. Forfeitures are accounted for as incurred. The Company uses the following assumptions for estimating the fair value of option grants: •Fair Value of Common Stock—The fair value of the common stock underlying the option grants is determined based on observable market prices of the Company’s common stock. •Expected Volatility—Volatility is a measure of the amount by which the Company’s share price has historically fluctuated or is expected to fluctuate on a daily basis and is expected to fluctuate (i.e., expected volatility) in the future. •Dividend Yield—The Company has never declared or paid dividends and has no plans to do so in the foreseeable future. Dividend yield is therefore zero. •Expected Term—This is the period of time during which options are expected to remain unexercised. For the years ended December 31, 2020, and 2019, we determined the expected term based on the historical exercise behavior of the stock option plan participants. Options have a maximum contractual term of ten years. •Risk-Free Interest Rate—This is the observed U.S. Treasury Note rate as of the week each option grant is issued, with a term that most closely resembles the expected term of the option. Restricted Stock Units (RSUs) Share-based compensation expense is recorded based on amortizing the fair market value of the RSU as of the date of the grant over the implied service period. RSUs generally vest one year from the date of the grant and are subject to continued service requirements. Forfeitures are accounted for as incurred. Performance Stock Units (PSUs) Performance-Based Awards Share-based compensation expense for performance-based awards is recognized based on amortizing the fair market value of the award as of the grant date over the periods during which the achievement of the performance target is probable. Performance-based awards require certain performance targets to be achieved in order for the award to vest. Vesting occurs on the date of achievement of the performance target. Forfeitures are accounted for as incurred. Market-Based Awards Share-based compensation expense for market-based awards is recognized on a straight-line basis over the requisite service period, regardless of whether the market condition has been satisfied. Market-based PSU awards vest upon the achievement of the performance target. Forfeitures are accounted for as incurred. The Company estimates the fair value of these awards as of the grant date using a Monte Carlo simulation that incorporates option-pricing inputs. This simulation covers the period from the grant date through the end of the derived requisite service period. Volatility as of the grant date is estimated based on historical daily volatility of the Company's common stock over a period of time, which is equivalent to the expected term of the award. The risk-free interest rate is based on the U.S. Treasury Note rate, as of the week, the award is issued, with a duration that most closely resembles the expected term of the award.
Leases	Leases On January 1, 2019, the Company adopted Accounting Standards Update (ASU) No. 2016-02, Leases (Topic 842) (New Lease Standard) using the modified retrospective transition approach. We applied the new standard to all leases existing at the date of initial application. Refer to the discussion under Recently Issued Accounting Pronouncements in Note 2. The Company determines if an arrangement is a lease considering whether there is an identified asset and the contract conveys the right to control its use. Leases with an initial term of 12 months or less are not recorded on the balance sheet. Right-of-use (ROU) assets and lease liabilities are recognized at the commencement date based on the present value of remaining lease payments over the lease term. For this purpose, the Company considers only payments that are fixed and determinable at the time of commencement. The Company calculates the present value of future payments by using an estimated incremental borrowing rate, which approximates the rate at which the Company would borrow, on a secured basis and over a similar term. This rate is estimated based on information available at the commencement date of the lease and may differ for individual leases or portfolios of leased assets. Additionally, for certain equipment leases, the Company applies a portfolio approach to effectively account for the operating lease ROU assets and lease liabilities. Lease expense for operating leases is recognized on a straight-line basis over the expected lease term and recognized as an operating cost. The finance lease asset related to a manufacturing facility is amortized on a straight-line basis over the lease term. Interest expense on finance lease liability is also recognized over the lease term. Some of the Company’s leases include options to terminate prior to the end of the lease term or to extend the lease for one or more years. These options are included in the lease term when it is reasonably certain that the option will be exercised. The Company’s lease agreements may contain variable costs such as common area maintenance, insurance, real estate taxes, or other costs. Variable lease costs are expensed as incurred on the consolidated statements of earnings. The Company’s lease agreements generally do not contain any material residual value guarantees or material restrictive covenants.
Advertising Expense	Advertising Expense Advertising expense includes the cost of promotional materials and activities, such as printed materials and digital marketing, marketing programs, and speaker programs. The cost of the Company's advertising efforts is expensed as incurred. The Company incurred approximately $54.5 million, $40.8 million, and $43.3 million in advertising expense for the years ended December 31, 2020, 2019, and 2018, respectively. These expenses are recorded as a component of Selling, general and administrative expenses in the consolidated statements of earnings.
Income Taxes	Income Taxes The Company utilizes the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and deferred tax liabilities are determined based on differences between their financial reporting and tax reporting bases. These differences are measured using enacted tax rates and laws that are expected to be in effect when the differences are expected to reverse. When appropriate, valuation allowances are established to reduce deferred tax assets to the amounts expected to be realized. The Company accounts for uncertain tax positions in its consolidated financial statements when it is more-likely-than-not that the position will be sustained upon examination by the tax authorities. Such tax positions are initially and subsequently estimated as the largest amount of the tax benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authorities. These estimates are based on full knowledge of the position and relevant facts. The Company's policy is to recognize any interest and penalties related to income taxes as income tax expense in the relevant period.
Recently Issued Accounting Pronouncements	Recently Issued Accounting Pronouncements Accounting Pronouncements Adopted ASU 2016-02, Leases (Topic 842) and subsequently issued related amendments codified in ASC 842, Leases, (the New Lease Standard), effective January 1, 2019, requires lessees to recognize lease assets and lease liabilities for those leases classified as operating leases under the previous GAAP, ASC 840, on the balance sheet and provide enhanced disclosures surrounding the amount, timing and uncertainty of cash flows arising from leasing arrangements. The Company adopted the New Lease Standard using the modified retrospective transition approach on January 1, 2019, by applying the New Lease Standard to all leases existing at the date of the initial adoption and not restating comparative periods. The adoption of the New Lease Standard resulted in recognition of lease assets and lease liabilities as of January 1, 2019, of approximately $4.0 million. The Company elected the package of practical expedients permitted under the transition guidance, which, among other things, allowed the Company to carryforward the historical lease classification, the assessment on whether a contract was or contains a lease, and the initial direct costs for any leases that existed prior to January 1, 2019. Refer to Note 10, Leases. ASU 2016-13, Financial Instruments—Credit Losses (Topic 326) - The new standard, issued in July 2016, requires credit losses on financial assets to be measured as the net amount expected to be collected, rather than based on actual incurred losses. For available-for-sale debt securities, the new standard did not revise the definition of impairment. The new standard also eliminated the concept of "other than temporary" from the impairment model for available-for-sale debt securities. Changes to the impairment model include recognition of credit losses on available-for-sale debt securities using the allowance method and limiting the allowance to the amount by which fair value is below amortized cost. The Company adopted the new standard effective January 1, 2020, using the modified retrospective approach. The adoption of the standard did not have a material impact on its consolidated financial statements. ASU 2018-13, Changes to Disclosure Requirements for Fair Value Measurements (Topic 820) - The new standard, issued in August 2018, improved the effectiveness of disclosure requirements for recurring and nonrecurring fair value measurements. The standard removes, modifies, and adds certain disclosure requirements. The Company adopted the new standard effective January 1, 2020. The adoption of the standard did not have a material impact on its consolidated financial statements. ASU 2018-15, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract - The new standard, issued in August 2018, aligns the requirements for capitalizing implementation costs incurred under a service contract for a hosting arrangement with the requirements for capitalizing implementation costs incurred to develop or to obtain internal-use software. This includes hosting arrangements that include an internal-use software license. This ASU also requires that the implementation costs of a hosting arrangement under a service contract be expensed over the term of the hosting arrangement, including reasonably certain renewals. The Company adopted the new standard effective January 1, 2020, using the prospective transition approach. The adoption of the standard did not have a material impact on its consolidated financial statements. ASU 2018-18, Clarifying the Interaction Between Topic 808 and Topic 606 - The new standard, issued in November 2018, clarifies when transactions between participants in a collaborative arrangement are within the scope of Topic 606. The Company adopted the new standard effective January 1, 2020. The adoption of the standard did not have a material impact on its consolidated financial statements. New Accounting Pronouncements Not Yet Adopted ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes - The new standard, issued in December 2019, simplifies the accounting for income taxes. This guidance will be effective on January 1, 2021, on a prospective basis, with early adoption permitted. ASU 2019-12 amends the requirements related to the accounting for “hybrid” tax regimes. Such regimes are tax jurisdictions that impose the greater of two taxes — one based on income or one based on items other than income. Under ASU 2019-02, an entity should include the amount of tax based on income in the tax provision and should record any incremental amount recorded as a tax not based on income. The Company will adopt the standard effective January 1, 2021. It is not expected to have a material effect on our consolidated financial statements. ASU 2020-01, Investments — Equity Securities (Topic 321), Investments — Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815), Clarifying the Interactions between Topic 321, Topic 323, and Topic 815 - The new standard, issued in January 2020, clarifies the interaction of the equity securities under Topic 321 and investments accounted for under the equity method of accounting in Topic 323 and the accounting for certain contracts and purchased options accounted under Topic 815. The amendment clarifies that an entity can elect to adopt the measurement alternative, which is if an entity identifies observable price changes in orderly transactions for the identical or a similar investment of the same issuer, it should measure the equity security at fair value as of the date that the observable transaction occurred before applying or upon discontinuing the equity method. ASU 2020-01 will be effective on January 1, 2021. The Company will adopt the standard effective January 1, 2021. It is not expected to have a material effect on our consolidated financial statements. ASU 2020-06, Debt - Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity's Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity's Own Equity - The new standard, issued in August 2020, simplifies the accounting and disclosures for convertible instruments and contracts. Under ASU 2020-06, entities must apply the if-converted method to all convertible instruments; the treasury stock method is no longer available. This guidance will be effective on January 1, 2022, on a prospective basis, with early adoption permitted but not earlier than January 1, 2021. The Company is currently evaluating the impact of the new guidance on its consolidated financial statements.

Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2020

Accounting Policies [Abstract]


	Percentage of Net Product Sales						Percentage of Accounts Receivable, net
	2020		2019		2018		2020		2019
Customer A	29	%	32	%	33	%	31	%	45	%
Customer B	31	%	32	%	33	%	32	%	21	%
Customer C	29	%	34	%	32	%	22	%	30	%
	89	%	98	%	98	%	85	%	96	%

USWM Acquisition (Tables)

12 Months Ended

Dec. 31, 2020

Business Combinations [Abstract]

Purchase price consideration


	As Initially Reported		Measurement Period Adjustments		As Adjusted
Cash consideration	$	304,194	$	1,341	$	305,535
Estimated fair value of contingent consideration	115,700		(40,900)		74,800
Estimated total purchase consideration	$	419,894	$	(39,559)	$	380,335

Cash consideration to Seller - net of cash acquired (1)	$	297,200	$	1,341	$	298,541

(1) Represents total purchase price, less cash and cash equivalents acquired, and contingent consideration liabilities. Measurement period

adjustment reflects additional payments made to Seller following the Closing date for working capital adjustments on the purchase price

consistent with the Agreement

Schedule of recognized identified assets acquired and liabilities assumed


	As Initially Reported		Measurement Period Adjustments		As Adjusted
Cash and cash equivalents	$	6,994	$	—	$	6,994
Accounts receivable	18,474		—		18,474
Inventories (1)	10,400		(700)		9,700
Prepaid expenses and other current assets	3,564		—		3,564
Property and equipment	454		—		454
Finance lease asset (2)	22,747		—		22,747
Intangible assets (1)	387,000		(32,000)		355,000
Other assets	340		—		340
Total of assets acquired	449,973		(32,700)		417,273
Accounts payable	(2,573)		—		(2,573)
Accrued expenses and other current liabilities	(23,339)		—		(23,339)
Finance lease liability (2)	(22,747)		—		(22,747)
Deferred income tax liabilities, net (3)	(69,515)		3,325		(66,190)
Total liabilities assumed	(118,174)		3,325		(114,849)
Total identifiable net assets	$	331,799	$	(29,375)	$	302,424
Goodwill	88,095		(10,184)		77,911
Total purchase price (4)	$	419,894	$	(39,559)	$	380,335

(2) Refer to Note 10 for further discussion of the acquired finance lease asset and assumed lease liability.

(3) Includes tax attributes that are subject to tax limitations. Measurement period adjustment is primarily due to the tax impact of the changes

in the initial estimate of the fair value of intangible assets and inventories.

(4) Measurement period adjustments include an adjustment to the fair value of the contingent consideration net of the additional cash payment

made to the Seller.

Finite-lived and indefinite-lived intangible assets acquired as part of business combination

The following table summarizes the preliminary purchase price allocation and the preliminary average remaining useful lives for identifiable intangible assets (dollars in thousands):


	Estimated Fair Value		Estimated Useful Lives as of Closing Date (in years)
Acquired In-process Research & Development	$	123,000	n/a
Acquired Developed Technology and Product Rights	232,000		10.5 - 12.5
Total intangible assets	$	355,000

Business acquisition, pro forma information


	December 31,
	2020		2019
	(unaudited)
Pro forma total revenues	$	583,657	$	542,807
Pro forma net earnings	133,423		110,842

Disaggregated Revenues (Tables)

12 Months Ended

Dec. 31, 2020

Disaggregation of Revenue [Abstract]

Summary of disaggregation of revenue by nature

The following table summarizes the disaggregation of revenues by product or source (dollars in thousands):


	Years Ended December 31,
	2020		2019		2018
Net product sales
Trokendi XR	$	319,640	$	295,214	$	315,295
Oxtellar XR	98,725		88,186		84,576
APOKYN	74,296		—		—
XADAGO	6,943		—		—
MYOBLOC	9,746		—		—
Total net product sales	509,350		383,400		399,871
Royalty revenues	11,047		9,355		8,276
Licensing revenues	—		—		750
Total revenues	$	520,397	$	392,755	$	408,897

Fair Value of Financial Instruments (Tables)

12 Months Ended

Dec. 31, 2020

Fair Value Disclosures [Abstract]

Schedule of fair value of the financial assets and liabilities

The Company’s financial assets that are required to be measured at fair value on a recurring basis are as follows (dollars in thousands):


			Fair Value Measurements as of December 31, 2020
	Total Fair value at December 31, 2020		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)
Assets:
Cash and cash equivalents
Cash	$	218,550	$	218,550	$	—
Money market funds	70,090		70,090		—
Marketable securities
Corporate debt securities	133,893		—		133,893
Long term marketable securities
Corporate debt securities	350,359		256		350,103
Other noncurrent assets
Marketable securities - restricted (SERP)	547		3		544
Total assets at fair value	$	773,439	$	288,899	$	484,540


			Fair Value Measurements as of December 31, 2019
	Total Fair Value at December 31, 2019		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)
Assets:
Cash and cash equivalents
Cash	$	78,912	$	78,912	$	—
Money market funds	102,469		102,469		—
Marketable securities
Corporate debt securities	165,527		—		165,527
Municipal debt securities	165		—		165
Long term marketable securities
Corporate debt securities	571,828		254		571,574
U.S. government agency and municipal debt securities	19,945		—		19,945
Other noncurrent assets
Marketable securities - restricted (SERP)	418		3		415
Total assets at fair value	$	939,264	$	181,638	$	757,626

Schedule of unrestricted marketable securities

Unrestricted available-for-sale marketable securities held by the Company are as follows (dollars in thousands):


	December 31, 2020		December 31, 2019
Corporate and U.S. government agency and municipal debt securities
Amortized cost	$	472,306	$	747,598
Gross unrealized gains	11,987		10,031
Gross unrealized losses	(41)		(164)
Total fair value	$	484,252	$	757,465

Schedule of contractual maturities of the unrestricted available for sale marketable securities held

The contractual maturities of the unrestricted available-for-sale marketable securities held by the Company are as follows (dollars in thousands):


	December 31, 2020
Less than 1 year	$	133,893
1 year to 2 years	132,480
2 years to 3 years	129,743
3 years to 4 years	88,136
Greater than 4 years	—
Total	$	484,252

Reconciliation of the beginning and ending balances related to the contingent consideration

The following table provides the reconciliation of contingent consideration liabilities balance as of December 31, 2020 (dollars in thousands):


Balance at December 31, 2019	$	—
Initial estimate of contingent consideration at Closing Date	115,700
Measurement period adjustment	(40,900)
Change in fair value recognized in earnings	1,900
Balance at December 31, 2020	$	76,700

Refer to Note 3 for further discussion on measurement period adjustments on the fair value at the Closing Date of the contingent consideration liability related to the USWM Acquisition.

Schedule of financial liabilities that are not carried at fair value

The following table sets forth the carrying value and fair value of the Company’s financial liabilities that are not carried at fair value (dollars in thousands):


	December 31, 2020				December 31, 2019
	Carrying Value		Fair Value (Level 2)		Carrying Value		Fair Value (Level 2)
Convertible notes, net	$	361,751	$	383,381	$	345,170	$	366,023

Convertible Senior Notes Due 2023 (Tables)

12 Months Ended

Dec. 31, 2020

Debt Disclosure [Abstract]

Summary of liability component of 2023 Notes

The liability component of the 2023 Notes consists of the following (dollars in thousands):


	December 31, 2020		December 31, 2019
2023 Notes	$	402,500	$	402,500
Unamortized debt discount and deferred financing costs	(40,749)		(57,330)
Total carrying value	$	361,751	$	345,170

Stockholders' Equity (Tables)

12 Months Ended

Dec. 31, 2020

Share-based Payment Arrangement [Abstract]

Schedule of share-based compensation expense

Share-based compensation expense is as follows (dollars in thousands):


	Years Ended December 31,
	2020		2019		2018
Research and development	$	2,431	$	2,599	$	1,943
Selling, general and administrative	14,130		12,247		9,348
Total	$	16,561	$	14,846	$	11,291

Schedule of assumptions used in estimation of fair value of each award option on the date of grant using Black-Scholes option-pricing model

The fair value of each option award is estimated on the date of the grant, using the Black-Scholes option-pricing model and the assumptions in the following table:


	Years Ended December 31,
	2020	2019	2018
Fair value of common stock	$21.13 - $23.99	$22.99 - $37.78	$37.20 - $58.15
Expected volatility	61.56% - 62.27%	61.36% - 63.28%	57.95% - 60.56%
Dividend yield	0%	0%	0%
Expected term	5.72 years - 6.54 years	5.53 years - 6.18 years	6.25 years
Risk-free interest rate	0.27% - 1.34%	1.69% - 2.55%	2.69% - 2.85%

Summary of stock option and SAR activity

The following table summarizes stock option and stock appreciation rights (SAR) activities:


	Number of Options	Weighted- Average Exercise Price		Weighted-Average Remaining Contractual Term (in years)	Aggregate Intrinsic Value (in thousands)
Outstanding , December 31, 2018	3,916,963	$	19.98	7.10	$	57,220
Granted	880,235	$	36.43
Exercised	(114,753)	$	12.90
Forfeited	(75,886)	$	34.80
Outstanding, December 31, 2019	4,606,559	$	23.06	6.66	$	27,716
Granted	1,370,225	$	23.55
Exercised	(204,373)	$	11.47
Forfeited	(320,549)	$	29.09
Outstanding, December 31, 2020	5,451,862	$	23.26	6.28	$	29,877
As of December 31, 2020
Vested and expected to vest	5,451,862	$	23.26	6.28	$	29,877
Exercisable	3,218,771	$	19.36	4.77	$	27,832

Earnings per Share (Tables)

12 Months Ended

Dec. 31, 2020

Earnings Per Share [Abstract]

Schedule of common stock equivalents excluded in the calculation of diluted earnings per share


	Years Ended December 31,
	2020	2019	2018
Stock options, RSUs, PSUs	2,888,785	1,145,446	199,982

Schedule of computation of basic and diluted net earnings per share


	Years Ended December 31,
	2020		2019		2018
Numerator, dollars in thousands:
Net earnings	$	126,950	$	113,056	$	110,993

Denominator:
Weighted average shares outstanding, basic	52,615,269		52,412,181		51,989,824
Effect of dilutive securities:
Stock options, RSUs and SARs	1,074,474		1,404,573		2,109,048
Weighted average shares outstanding, diluted	53,689,743		53,816,754		54,098,872

Earnings per share, basic	$	2.41	$	2.16	2.13
Earnings per share, diluted	$	2.36	$	2.10	2.05

Income Taxes Expense (Tables)

12 Months Ended

Dec. 31, 2020

Income Tax Disclosure [Abstract]

Schedule of summary of the income tax expense (benefit)

The summary of the income tax expense (benefit) for the years ended December 31, 2020, 2019, and 2018 is as follows (dollars in thousands):


	Years Ended December 31,
	2020		2019		2018
Current
Federal	$	29,893	$	29,333	$	26,772
State	11,234		10,930		5,621
Deferred
Federal	2,200		(4,551)		(2,450)
State	(1,629)		(1,281)		(760)
Total income tax expense	$	41,698	$	34,431	$	29,183

Schedule of reconciliation of income tax expense

A reconciliation of income tax expense at the U.S. federal statutory income tax rate to annual income tax expense at the Company's effective tax rate is as follows (dollars in thousands):


	Years Ended December 31,
	2020		2019		2018
Income tax expense computed at U.S. federal statutory income tax rate	$	35,417	$	30,972	$	29,437
State income taxes	7,281		7,543		3,674
Permanent items	2,654		1,332		(2,196)
Research and development credits	(3,602)		(2,071)		(3,199)
Uncertain income tax position	348		(2,992)		716
Other	(400)		(353)		751
Income tax expense	$	41,698	$	34,431	$	29,183

Schedule of significant components of deferred tax assets (liabilities)

The significant components of the Company's deferred income tax assets (liabilities) are as follows (dollars in thousands):


	As of December 31,
	2020		2019
Deferred tax assets:
Convertible bond hedge	$	12,420	$	17,197
Accrued product returns and rebates	17,529		15,123
Accrued compensation and stock based compensation	13,547		10,349
Non-recourse liability related to sale of future royalties	3,777		5,320
Research and development credit carryforwards	3,151		3,817
Amortization of intangibles	—		4,617
Net operating loss carryforwards	13,164		2,245
Operating lease liability	14,542		8,187
Other	5,303		2,510
Total deferred tax assets	83,433		69,365
Less: valuation allowance	(582)		(11)
Total deferred tax asset, net of valuation allowance	82,851		69,354
Deferred tax liabilities:
Amortization of intangibles	(79,545)		—
Debt discount on 2023 Notes	(10,190)		(14,109)
Patent infringement legal costs	(10,897)		(10,613)
Operating lease assets	(10,674)		(5,237)
Depreciation	(3,458)		(2,778)
IRC Section 481(a) liability	(315)		(2,126)
Unrealized gain on marketable securities	(2,987)		(2,428)
Total deferred tax liabilities	(118,066)		(37,291)
Net deferred tax (liabilities) assets	$	(35,215)	$	32,063

Schedule of reconciliation of unrecognized tax benefits

A reconciliation of the beginning and ending amount of gross unrecognized tax benefits is as follows (dollars in thousands):


	Years Ended December 31,
	2020		2019		2018
Balance as of January 1	$	5,978	$	8,848	$	8,859
Gross increases related to current year tax positions	1,027		208		1,108
Gross increases related to prior year tax positions	221		—		—
Gross decreases related to prior year tax positions	—		(49)		(484)
Lapse of statute of limitations	(1,345)		(3,029)		(635)
Balance as of December 31	$	5,881	$	5,978	$	8,848

Leases (Tables)

12 Months Ended

Dec. 31, 2020

Leases [Abstract]

Schedule of balance sheet information related to leases

Operating and finance lease assets and lease liabilities as reported on the consolidated balance sheets are as follows (dollars in thousands):


		December 31,
	Balance Sheet Classification	2020		2019
Assets
Operating lease assets	Other assets	$	20,231	$	21,279
Finance lease asset	Property and equipment, net	20,874		—
Total lease assets		$	41,105	$	21,279

Liabilities
Lease liabilities, current
Operating lease liabilities, current portion	Accounts payable and accrued liabilities	$	3,760	$	2,825
Finance lease liability, current portion	Other current liabilities	3,761		—
Lease liabilities, long term
Operating lease liabilities, long term	Operating lease liabilities, long term	28,579		30,440
Finance lease liability, long term	Other liabilities	20,235		—
Total lease liabilities		$	56,335	$	33,265

Schedule of lease costs and supplemental cash flow information

The components of operating and finance lease costs are as follows (dollars in thousands):


	December 31,
	2020		2019
Operating lease cost:
Fixed lease cost	$	5,333	$	4,990
Variable lease cost	2,145		1,887
Total	$	7,478	$	6,877

Finance lease cost:
Amortization on finance lease asset	$	1,873	$	—
Interest on lease liability	333		—
Total	$	2,206	$	—

Supplemental cash flow information related to leases is as follows (dollars in thousands):


	December 31,
	2020		2019
Cash paid for operating leases	$	6,949	$	5,337
Cash paid for finance lease	802		—
Lease assets and tenant receivables obtained for new operating leases	2,478		35,594
Lease assets obtained for new finance lease	22,747		—

Weighted average lease term, and weighted average discount rate for operating and finance leases as of December 31, 2020, are as follows:


Operating leases
Weighted-average remaining lease term (years)	11.7
Weighted-average discount rate	4.33	%
Finance lease
Weighted-average remaining lease term (years)	6.4
Weighted-average discount rate	2.47	%

Schedule of maturities of operating lease liabilities

Future minimum lease payments under noncancellable operating and finance leases as of December 31, 2020, are as follows (dollars in thousands):


	Operating Leases		Finance Lease
Year ending December 31:
2021	$	5,066	$	3,946
2022	4,474		3,665
2023	2,701		3,665
2024	2,587		3,665
2025	2,638		3,665
Thereafter	24,145		7,329
Total future minimum lease payments	$	41,611	$	25,935
Less: Imputed interest (1)	(9,272)		(1,939)
Present value of lease liabilities	$	32,339	$	23,996

(1) Calculated using the interest rate for each lease.

Schedule of maturities of financing lease liabilities

Future minimum lease payments under noncancellable operating and finance leases as of December 31, 2020, are as follows (dollars in thousands):


	Operating Leases		Finance Lease
Year ending December 31:
2021	$	5,066	$	3,946
2022	4,474		3,665
2023	2,701		3,665
2024	2,587		3,665
2025	2,638		3,665
Thereafter	24,145		7,329
Total future minimum lease payments	$	41,611	$	25,935
Less: Imputed interest (1)	(9,272)		(1,939)
Present value of lease liabilities	$	32,339	$	23,996

(1) Calculated using the interest rate for each lease.

Inventories (Tables)

12 Months Ended

Dec. 31, 2020

Inventory Disclosure [Abstract]

Schedule of inventories

Inventories consist of the following (dollars in thousands):


	December 31, 2020		December 31, 2019
Raw materials	$	22,208	$	4,582
Work in process	8,985		11,428
Finished goods	17,132		10,618
Total	$	48,325	$	26,628

Property and Equipment (Tables)

12 Months Ended

Dec. 31, 2020

Property, Plant and Equipment [Abstract]

Schedule of property and equipment

Property and equipment consists of the following (dollars in thousands):


	December 31, 2020		December 31, 2019
Lab equipment and furniture	$	12,526	$	11,053
Leasehold improvements	15,183		14,217
Software	2,295		2,225
Finance lease assets (1)	22,747		—
Computer equipment	2,113		1,839
Construction-in-progress	—		433
	54,864		29,767
Less accumulated depreciation and amortization	(17,040)		(12,699)
Total	$	37,824	$	17,068

(1) Refer to Note 10, Leases.

Goodwill and Intangible Assets, Net (Tables)

12 Months Ended

Dec. 31, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Goodwill

The following table sets forth the reconciliation of the goodwill balance as of December 31, 2020 (dollars in thousands):


	December 31, 2020
Balance at December 31, 2019	$	—
Initial estimate of Goodwill at Closing Date	88,095
Measurement period adjustment	(10,184)
Balance at December 31, 2020	$	77,911

Schedule of gross carrying amount and related accumulated amortization of goodwill and intangible assets

The following table sets forth the gross carrying amounts and related accumulated amortization of intangible assets (dollars in thousands):


	Remaining Weighted- Average Life (Years)	December 31, 2020		December 31, 2019
Acquired In-process Research & Development		$	123,000	$	—
Intangible assets subject to amortization
Acquired Developed Technology and Product Rights	10 - 12	232,000		—
Capitalized patent defense costs	2.00 - 6.25	43,579		43,375
Less accumulated amortization		(34,237)		(18,535)
Total intangible assets, net		$	364,342	$	24,840

Accounts Payable and Accrued Liabilities (Tables)

12 Months Ended

Dec. 31, 2020

Payables and Accruals [Abstract]

Schedule of accrued expenses and accrued liabilities

Accounts payable and accrued liabilities consist of the following (dollars in thousands):


	December 31, 2020		December 31, 2019
Accrued compensation	$	16,008	$	11,223
Accrued royalties (1)	13,890		—
Accrued clinical trial costs (2)	12,842		13,285
Inventory-related accruals	9,587		1,095
Accrued professional fees	7,730		3,936
Accounts payable	6,147		10,141
Operating lease liabilities portion (3)	3,760		2,825
Income taxes payable	—		2,443
Other accrued expenses	8,970		4,766
Total	$	78,934	$	49,714

(1) Refer to Note 21, Commitments and Contingencies.

(2) Includes preclinical and all clinical trial-related costs.

(3) Refer to Note 10, Leases.

Accrued Product Returns and Rebates (Tables)

12 Months Ended

Dec. 31, 2020

Accrued Product Returns and Rebates

Schedule of accrued sales deductions

Accrued product returns and rebates consist of the following (dollars in thousands):


	December 31, 2020		December 31, 2019
Accrued product rebates	$	96,589	$	88,811
Accrued product returns	29,603		18,818
Total	$	126,192	$	107,629

Other Liabilities (Tables)

12 Months Ended

Dec. 31, 2020

Other Liabilities Disclosure [Abstract]

Other Liabilities

Other liabilities consist of the following (dollars in thousands):


	December 31, 2020		December 31, 2019
Nonrecourse liability related to sale of future royalties, long term	$	13,410	$	19,248
Finance lease liability, long term (1)	20,235		—
Other liabilities	9,146		9,409
Total	$	42,791	$	28,657

(1) Refer to Note 10, Leases.

Other (Expense) Income (Tables)

12 Months Ended

Dec. 31, 2020

Other Income and Expenses [Abstract]

Schedule of other (expenses) income

Other (expense) income consists of the following (dollars in thousands):


	Years Ended December 31,
	2020		2019		2018
Interest and other income, net	$	18,704	$	21,623	$	13,843
Interest expense	(19,435)		(18,207)		(13,840)
Interest expense on nonrecourse liability related to sale of future royalties	(4,319)		(4,500)		(4,271)
Total	$	(5,050)	$	(1,084)	$	(4,268)

Organization and Business (Details) - product		12 Months Ended
Organization and Business (Details) - product	Jun. 09, 2020	Dec. 31, 2020
Organization and Nature of Operations
Number of commercial products		5
Number development products		2
MDD US Enterprises LLC (Formerly USWM Enterprises)
Business Acquisition [Line Items]
Number of commercial products acquired in acquisition	3

Summary of Significant Accounting Policies - Segments (Details)	12 Months Ended
	Dec. 31, 2020 segment
Accounting Policies [Abstract]
Number of operating segments	1

Summary of Significant Accounting Policies - Accounts Receivable, Net and Concentration of Credit Risk (Details) - Customer Concentration Risk	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Percentage of Net Product Sales
Accounts Receivable, Net
Concentration risk percentage	89.00%	98.00%	98.00%
Percentage of Net Product Sales \| Customer A
Accounts Receivable, Net
Concentration risk percentage	29.00%	32.00%	33.00%
Percentage of Net Product Sales \| Customer B
Accounts Receivable, Net
Concentration risk percentage	31.00%	32.00%	33.00%
Percentage of Net Product Sales \| Customer C
Accounts Receivable, Net
Concentration risk percentage	29.00%	34.00%	32.00%
Percentage of Accounts Receivable, net
Accounts Receivable, Net
Concentration risk percentage	85.00%	96.00%
Percentage of Accounts Receivable, net \| Customer A
Accounts Receivable, Net
Concentration risk percentage	31.00%	45.00%
Percentage of Accounts Receivable, net \| Customer B
Accounts Receivable, Net
Concentration risk percentage	32.00%	21.00%
Percentage of Accounts Receivable, net \| Customer C
Accounts Receivable, Net
Concentration risk percentage	22.00%	30.00%

Summary of Significant Accounting Policies - Deferred Financing Costs (Details) - Convertible notes, net	Dec. 31, 2020 USD ($)
Deferred Financing Costs
Principal amount of debt	$ 402,500,000
Interest rate (as a percent)	0.625%

Summary of Significant Accounting Policies - Revenue Recognition (Details) - USD ($)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Revenue Recognition
Contract assets	$ 0	$ 0
Contract liabilities	$ 0	0
Sales return period prior to expiry date	6 months
Sales return period subsequent to expiry date	12 months
License and collaboration agreements
Revenue Recognition
Minimum guaranteed amounts owed to company	$ 0	0
Royalty revenue agreements
Revenue Recognition
Minimum guaranteed amounts owed to company	$ 0	$ 0
Maximum
Revenue Recognition
Product shelf life	48 months

Summary of Significant Accounting Policies - Share-based Compensation (Details)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Accounting Policies [Abstract]
Dividend yield (as a percent)	0.00%
Share-Based Compensation
Dividend yield (as a percent)	0.00%
Maximum contractual term of share-based grants	10 years	10 years
RSUs
Share-Based Compensation
Vesting period (in years)	1 year

Summary of Significant Accounting Policies - Leases (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019	Jan. 01, 2019
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Operating lease assets	$ 20,231	$ 21,279
Lease liabilities	$ 32,339
ASU 2016-02
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Operating lease assets			$ 4,000
Lease liabilities			$ 4,000

Summary of Significant Accounting Policies - Advertising Expense (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Accounting Policies [Abstract]
Advertising costs	$ 54.5	$ 40.8	$ 43.3

Summary of Significant Accounting Policies - Recently Issued Accounting Pronouncements (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Accounting Policies [Abstract]
Operating lease assets	$ 20,231	$ 21,279
Lease liabilities	$ 32,339

USWM Acquisition - Schedule of Recognized Identified Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands		3 Months Ended	7 Months Ended	12 Months Ended
	Jun. 09, 2020	Dec. 31, 2020	Dec. 31, 2020	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Business Acquisition [Line Items]
Goodwill		$ 77,911	$ 77,911	$ 77,911	$ 0
Cash consideration to Seller - net of cash acquired				298,541	0	$ 0
MDD US Enterprises LLC (Formerly USWM Enterprises)
Business Acquisition [Line Items]
Cash and cash equivalents	$ 6,994
Accounts receivable	18,474
Inventories	9,700
Prepaid expenses and other current assets	3,564
Property and equipment	454
Finance lease asset	22,747
Intangible assets	355,000
Other assets	340
Total of assets acquired	417,273
Accounts payable	(2,573)
Accrued expenses and other current liabilities	(23,339)
Finance lease liability	(22,747)
Deferred income tax liabilities	(66,190)
Total liabilities assumed	(114,849)
Total identifiable net assets	302,424
Goodwill		77,911	77,911	77,911	$ 0
Total purchase price (4)	380,335
Cash consideration to Seller - net of cash acquired	298,541
Measurement Period Adjustments
Inventories		(700)
Intangible assets		(32,000)
Total of assets acquired		(32,700)
Deferred income tax liabilities		(3,325)
Total liabilities assumed		(3,325)
Total identifiable net assets		(29,375)
Measurement period adjustment				$ 10,184
Total purchase price		(39,559)	(39,559)
Cash consideration to Seller - net of cash acquired		$ 1,300	$ 1,341
MDD US Enterprises LLC (Formerly USWM Enterprises) \| As Initially Reported
Business Acquisition [Line Items]
Cash and cash equivalents	6,994
Accounts receivable	18,474
Inventories	10,400
Prepaid expenses and other current assets	3,564
Property and equipment	454
Finance lease asset	22,747
Intangible assets	387,000
Other assets	340
Total of assets acquired	449,973
Accounts payable	(2,573)
Accrued expenses and other current liabilities	(23,339)
Finance lease liability	(22,747)
Deferred income tax liabilities	(69,515)
Total liabilities assumed	(118,174)
Total identifiable net assets	331,799
Goodwill	88,095
Total purchase price (4)	419,894
Cash consideration to Seller - net of cash acquired	$ 297,200

USWM Acquisition - Narrative (Details) - USD ($) $ in Thousands		3 Months Ended	7 Months Ended	12 Months Ended
	Jun. 09, 2020	Dec. 31, 2020	Dec. 31, 2020	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Business Acquisition [Line Items]
Cash consideration to Seller - net of cash acquired				$ 298,541	$ 0	$ 0
Contingent consideration liability, high value	$ 230,000
Contingent consideration expense				1,900	0	$ 0
SPN-30 Regulatory and Commercial Activities
Business Acquisition [Line Items]
Contingent consideration liability, high value	130,000
SPN-830 FDA Acceptance Milestone
Business Acquisition [Line Items]
Contingent consideration liability, high value	25,000
SPN-830 NDA Approval Milestone
Business Acquisition [Line Items]
Contingent consideration liability, high value	105,000
SPN-830 First Commercial And Sale Milestone
Business Acquisition [Line Items]
Contingent consideration liability, high value	100,000
Future Sales Performance
Business Acquisition [Line Items]
Contingent consideration liability, high value	100,000
APOKYN
Business Acquisition [Line Items]
Contingent consideration liability, high value	35,000
APOKYN and SPN-830
Business Acquisition [Line Items]
Contingent consideration liability, high value	65,000
MDD US Enterprises LLC (Formerly USWM Enterprises)
Business Acquisition [Line Items]
Cash consideration to Seller - net of cash acquired	298,541
Contingent consideration liability, high value	74,800
Working capital adjustment		$ 1,300	$ 1,341
Additional cash payments upon milestone achievements maximum	230,000
Additional cash payments upon milestone achievements minimum	0
Contingent consideration expense		1,900	(40,900)	40,900
Contingent consideration, liability	74,800
Inventories		(700)
Estimated Fair Value	355,000
Intangible assets		(32,000)
Transaction costs				8,400	$ 1,700
Operating earnings				9,900
Cumulative transaction costs		$ 10,100	$ 10,100	10,100
MDD US Enterprises LLC (Formerly USWM Enterprises) \| Net product sales
Business Acquisition [Line Items]
Revenues				$ 91,000
MDD US Enterprises LLC (Formerly USWM Enterprises) \| Acquired In-process Research & Development
Business Acquisition [Line Items]
Estimated Fair Value	123,000
MDD US Enterprises LLC (Formerly USWM Enterprises) \| Acquired Developed Technology and Product Rights
Business Acquisition [Line Items]
Estimated Fair Value	232,000
MDD US Enterprises LLC (Formerly USWM Enterprises) \| As Initially Reported
Business Acquisition [Line Items]
Cash consideration to Seller - net of cash acquired	297,200
Contingent consideration liability, high value	115,700
Estimated Fair Value	387,000
MDD US Enterprises LLC (Formerly USWM Enterprises) \| As Initially Reported \| Acquired In-process Research & Development
Business Acquisition [Line Items]
Estimated Fair Value	150,000
MDD US Enterprises LLC (Formerly USWM Enterprises) \| As Initially Reported \| Acquired Developed Technology and Product Rights
Business Acquisition [Line Items]
Estimated Fair Value	$ 237,000

USWM Acquisition - Components of Intangible Assets and Estimated Useful Lives (Details) - MDD US Enterprises LLC (Formerly USWM Enterprises) $ in Thousands	Jun. 09, 2020 USD ($)
Business Acquisition [Line Items]
Estimated Fair Value	$ 355,000
Acquired In-process Research & Development
Business Acquisition [Line Items]
Estimated Fair Value	123,000
Acquired Developed Technology and Product Rights
Business Acquisition [Line Items]
Estimated Fair Value	$ 232,000
Acquired Developed Technology and Product Rights \| Minimum
Business Acquisition [Line Items]
Estimated Useful Lives as of Closing Date (in years)	10 years 6 months
Acquired Developed Technology and Product Rights \| Maximum
Business Acquisition [Line Items]
Estimated Useful Lives as of Closing Date (in years)	12 years 6 months

USWM Acquisition - Pro Forma Information (Details) - MDD US Enterprises LLC (Formerly USWM Enterprises) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Business Acquisition [Line Items]
Pro forma total revenues	$ 583,657	$ 542,807
Pro forma net earnings	$ 133,423	$ 110,842

USWM Acquisition - Purchase Price Consideration (Details) - USD ($) $ in Thousands		3 Months Ended	7 Months Ended	12 Months Ended
	Jun. 09, 2020	Dec. 31, 2020	Dec. 31, 2020	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Business Acquisition [Line Items]
Cash consideration				$ 0	$ 0	$ 15,000
Contingent consideration liability, high value	$ 230,000
Cash consideration to Seller - net of cash acquired				298,541	0	0
Measurement Period Adjustments
Contingent consideration liability related to USWM acquisition				1,900	$ 0	$ 0
MDD US Enterprises LLC (Formerly USWM Enterprises)
Business Acquisition [Line Items]
Cash consideration	305,535
Contingent consideration liability, high value	74,800
Contingent consideration liability accrued in USWM Acquisition	380,335
Cash consideration to Seller - net of cash acquired	298,541
Measurement Period Adjustments
Cash consideration			$ 1,341
Contingent consideration liability related to USWM acquisition		$ 1,900	(40,900)	$ 40,900
Estimated total purchase consideration		(39,559)	(39,559)
Cash consideration to Seller - net of cash acquired		$ 1,300	$ 1,341
As Initially Reported \| MDD US Enterprises LLC (Formerly USWM Enterprises)
Business Acquisition [Line Items]
Cash consideration	304,194
Contingent consideration liability, high value	115,700
Contingent consideration liability accrued in USWM Acquisition	419,894
Cash consideration to Seller - net of cash acquired	$ 297,200

Disaggregated Revenues - Summary of Revenues (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Disaggregation of Revenue [Line Items]
Total revenues	$ 520,397	$ 392,755	$ 408,897
Trokendi XR
Disaggregation of Revenue [Line Items]
Total revenues	319,640	295,214	315,295
Oxtellar XR
Disaggregation of Revenue [Line Items]
Total revenues	98,725	88,186	84,576
APOKYN
Disaggregation of Revenue [Line Items]
Total revenues	74,296	0	0
XADAGO
Disaggregation of Revenue [Line Items]
Total revenues	6,943	0	0
MYOBLOC
Disaggregation of Revenue [Line Items]
Total revenues	9,746	0	0
Net product sales
Disaggregation of Revenue [Line Items]
Total revenues	509,350	383,400	399,871
Royalty revenue
Disaggregation of Revenue [Line Items]
Total revenues	11,047	9,355	8,276
Licensing revenue
Disaggregation of Revenue [Line Items]
Total revenues	$ 0	$ 0	$ 750

Disaggregated Revenues - Narrative (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Revenue Recognition
Noncash royalty revenue	$ 8,500	$ 6,900	$ 5,900
Estimated adjustment for product returns related to prior year sales	13,800	(400)
Total revenues	520,397	392,755	408,897
Trokendi XR
Revenue Recognition
Estimated adjustment for product returns related to prior year sales	10,700
Total revenues	319,640	295,214	315,295
Net product sales
Revenue Recognition
Total revenues	$ 509,350	$ 383,400	$ 399,871
Revenue from Contract with Customer Benchmark \| Product Concentration Risk \| Trokendi XR
Revenue Recognition
Concentration risk percentage (more than)	60.00%	70.00%	70.00%

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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Fair Value of Financial Instruments - Narrative (Details) - USD ($)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impairment due to credit losses	$ 0
Recurring \| Fair Value (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets at fair value	$ 0	$ 0

Fair Value of Financial Instruments - Carrying Value (Details) - Recurring - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Total Fair Value
Other noncurrent assets
Marketable securities - restricted (SERP)	$ 547	$ 418
Total assets at fair value	773,439	939,264
Quoted Prices in Active Markets for Identical Assets (Level 1) \| Estimate of Fair Value Measurement
Other noncurrent assets
Marketable securities - restricted (SERP)	3	3
Total assets at fair value	288,899	181,638
Significant Other Observable Inputs (Level 2) \| Estimate of Fair Value Measurement
Other noncurrent assets
Marketable securities - restricted (SERP)	544	415
Total assets at fair value	484,540	757,626
Cash \| Total Fair Value
Assets:
Cash and cash equivalents	218,550	78,912
Cash \| Quoted Prices in Active Markets for Identical Assets (Level 1) \| Estimate of Fair Value Measurement
Assets:
Cash and cash equivalents	218,550	78,912
Cash \| Significant Other Observable Inputs (Level 2) \| Estimate of Fair Value Measurement
Assets:
Cash and cash equivalents	0	0
Money market funds \| Total Fair Value
Assets:
Cash and cash equivalents	70,090	102,469
Money market funds \| Quoted Prices in Active Markets for Identical Assets (Level 1) \| Estimate of Fair Value Measurement
Assets:
Cash and cash equivalents	70,090	102,469
Money market funds \| Significant Other Observable Inputs (Level 2) \| Estimate of Fair Value Measurement
Assets:
Cash and cash equivalents	0	0
Corporate debt securities \| Total Fair Value
Marketable securities
Marketable securities	133,893	165,527
Long term marketable securities
Long term marketable securities	350,359	571,828
Corporate debt securities \| Quoted Prices in Active Markets for Identical Assets (Level 1) \| Estimate of Fair Value Measurement
Marketable securities
Marketable securities	0	0
Long term marketable securities
Long term marketable securities	256	254
Corporate debt securities \| Significant Other Observable Inputs (Level 2) \| Estimate of Fair Value Measurement
Marketable securities
Marketable securities	133,893	165,527
Long term marketable securities
Long term marketable securities	$ 350,103	571,574
Municipal debt securities \| Total Fair Value
Marketable securities
Marketable securities		165
Municipal debt securities \| Quoted Prices in Active Markets for Identical Assets (Level 1) \| Estimate of Fair Value Measurement
Marketable securities
Marketable securities		0
Municipal debt securities \| Significant Other Observable Inputs (Level 2) \| Estimate of Fair Value Measurement
Marketable securities
Marketable securities		165
U.S. government agency and municipal debt securities \| Total Fair Value
Long term marketable securities
Long term marketable securities		19,945
U.S. government agency and municipal debt securities \| Quoted Prices in Active Markets for Identical Assets (Level 1) \| Estimate of Fair Value Measurement
Long term marketable securities
Long term marketable securities		0
U.S. government agency and municipal debt securities \| Significant Other Observable Inputs (Level 2) \| Estimate of Fair Value Measurement
Long term marketable securities
Long term marketable securities		$ 19,945

Fair Value of Financial Instruments - Unrestricted Marketable Securities (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Fair Value Disclosures [Abstract]
Amortized cost	$ 472,306	$ 747,598
Gross unrealized gains	11,987	10,031
Gross unrealized losses	(41)	(164)
Total fair value	$ 484,252	$ 757,465

Fair Value of Financial Instruments - Contractual Maturities (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Fair Value Disclosures [Abstract]
Less than 1 year	$ 133,893
1 year to 2 years	132,480
2 years to 3 years	129,743
3 years to 4 years	88,136
Greater than 4 years	0
Total	$ 484,252	$ 757,465

Fair Value of Financial Instruments - Reconciliation of the Beginning and Ending Balances Related to the Contingent Consideration (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2020 USD ($)
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward]
Balance at December 31, 2019	$ 0
Initial estimate of contingent consideration at Closing Date	115,700
Measurement period adjustment	(40,900)
Change in fair value recognized in earnings	1,900
Balance at December 31, 2020	$ 76,700

Fair Value of Financial Instruments - Financial Instruments (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Carrying Value	$ 361,751	$ 345,170
Convertible notes, net \| Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Carrying Value	361,751	345,170
Fair Value	$ 383,381	$ 366,023

Convertible Senior Notes Due 2023 - Narrative (Details)	12 Months Ended
Convertible Senior Notes Due 2023 - Narrative (Details)	Dec. 31, 2020 USD ($) day $ / shares Rate shares	Dec. 31, 2019 USD ($)
Debt Instrument [Line Items]
Strike price of the warrant transactions (in dollars per share) \| $ / shares	$ 80.9063
Convertible Debt
Debt Instrument [Line Items]
Interest rate (as a percent)	0.625%
Effective interest rate (as percent)	5.41%
Principal amount of debt \| $	$ 402,500,000	$ 402,500,000
Conversion rate for the notes (in shares per $1,000 principal amount)	0.0168545
Conversion price (in dollars per share) \| $ / shares	$ 59.33
Convertible note hedge options issued (in shares) \| shares	402,500
Common stock issued upon conversion of Notes (in shares) \| shares	6,800,000
Warrants issued (in shares) \| shares	6,783,939
Number of warrants (in shares) \| shares	1
Conversion of debt to equity \| $	$ 0	$ 0
Convertible Debt \| Conversion Circumstance One
Debt Instrument [Line Items]
Threshold trading days (whether or not consecutive) \| day	20
Consecutive trading day period (in days) \| day	30
Conversion rate of the notes on trading day (as percent)	130.00%
Conversion option stock price trigger (in dollars per share) \| $ / shares	$ 77.13
Convertible Debt \| Conversion Circumstance Two
Debt Instrument [Line Items]
Threshold trading days (whether or not consecutive) \| day	5
Consecutive trading day period (in days) \| day	10
Conversion rate of the notes on trading day (as percent) \| Rate	98.00%

Convertible Senior Notes Due 2023 - Summary of liability component of 2023 Notes (Details) - USD ($)	Dec. 31, 2020	Dec. 31, 2019
Debt Instrument [Line Items]
Total carrying value	$ 361,751,000	$ 345,170,000
Convertible Debt
Debt Instrument [Line Items]
2023 Notes	402,500,000	402,500,000
Unamortized debt discount and deferred financing costs	(40,749,000)	(57,330,000)
Total carrying value	$ 361,751,000	$ 345,170,000

Stockholders' Equity - Narrative (Details) $ / shares in Units, $ in Millions	12 Months Ended
	Dec. 31, 2020 USD ($) segment installment $ / shares shares	Dec. 31, 2019 USD ($) $ / shares shares	Dec. 31, 2018 USD ($) $ / shares
Share-Based Compensation
Number of votes to which holders of common shares are entitled for each share held \| segment	1
Contractual term (in years)	10 years	10 years
Stock Option
Share-Based Compensation
Total unrecognized compensation expense \| $	$ 25.5
Weighted-average period over which total unrecognized compensation expense is expected to be recognized (in years)	2 years 6 months 7 days
Stock option and Stock Appreciation Rights
Share-Based Compensation
Weighted average fair value, grant date, options (in dollars per share) \| $ / shares	$ 13.44	$ 21.50	$ 23.43
Aggregate intrinsic value of shares exercised \| $	$ 2.3	$ 2.4	$ 36.3
Proceeds from Stock Options Exercised \| $	2.3	1.5	9.4
Total fair value of the underlying common stock related to shares that vested \| $	$ 14.1	$ 10.8	$ 8.3
Granted options (in shares) \| shares	1,370,225	880,235
RSUs
Share-Based Compensation
Vesting period (in years)	1 year
Total unrecognized compensation expense \| $	$ 0.2
Weighted-average period over which total unrecognized compensation expense is expected to be recognized (in years)	4 months 24 days
Granted (in shares) \| shares	26,055
Weighted average fair value, grant date, (in dollars per share) \| $ / shares	$ 23.99
Performance-Based Awards
Share-Based Compensation
Total fair value of the underlying common stock related to shares that vested \| $	$ 0.7
Weighted average fair value, grant date, (in dollars per share) \| $ / shares	$ 21.35
Granted options (in shares) \| shares	31,250
Market Based Awards
Share-Based Compensation
Weighted-average period over which total unrecognized compensation expense is expected to be recognized (in years)	10 months 6 days
Weighted average fair value, grant date, options (in dollars per share) \| $ / shares	$ 23.41
Granted options (in shares) \| shares	15,625
2012 Plan
Share-Based Compensation
Maximum number of shares of common stock provided for issuance \| shares	11,000,000
2012 Plan \| Stock Option
Share-Based Compensation
Number of annual installments in which the awards would generally vest starting on the first anniversary of the date of grant \| installment	4
2012 Plan \| Stock Option \| Employees, Consultants and Advisors
Share-Based Compensation
Contractual term (in years)	10 years
2012 Plan \| Stock Option \| Directors
Share-Based Compensation
Contractual term (in years)	10 years
Vesting period (in years)	1 year
Employee Stock Purchase Plan
Share-Based Compensation
Maximum number of shares of common stock provided for issuance \| shares	1,700,000
Purchase price percentage	85.00%

Stockholders' Equity - Share-based Compensation Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Share-based Payments
Total	$ 16,561	$ 14,846	$ 11,291
Research and development
Share-based Payments
Total	2,431	2,599	1,943
Selling, general and administrative
Share-based Payments
Total	$ 14,130	$ 12,247	$ 9,348

Stockholders' Equity - Fair Value of Each Option Awarded (Details) - $ / shares	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Share-Based Compensation
Dividend yield (as a percent)	0.00%
Stock Option
Share-Based Compensation
Expected volatility, minimum (as a percent)	61.56%	61.36%	57.95%
Expected volatility, maximum (as a percent)	62.27%	63.28%	60.56%
Dividend yield (as a percent)	0.00%	0.00%	0.00%
Expected term (in years)			6 years 3 months
Risk-free interest rate, minimum (as a percent)	0.27%	1.69%	2.69%
Risk-free interest rate, maximum (as a percent)	1.34%	2.55%	2.85%
Stock Option \| Minimum
Share-Based Compensation
Fair value of common stock (in dollars per share)	$ 21.13	$ 22.99	$ 37.20
Expected term (in years)	5 years 8 months 19 days	5 years 6 months 10 days
Stock Option \| Maximum
Share-Based Compensation
Fair value of common stock (in dollars per share)	$ 23.99	$ 37.78	$ 58.15
Expected term (in years)	6 years 6 months 14 days	6 years 2 months 4 days

Stockholders' Equity - Activity (Details) - Stock option and Stock Appreciation Rights - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Number of Options and SAR
Outstanding at the beginning of the period (in shares)	4,606,559	3,916,963
Granted (in shares)	1,370,225	880,235
Exercised (in shares)	(204,373)	(114,753)
Forfeited (in shares)	(320,549)	(75,886)
Outstanding at the end of the period (in shares)	5,451,862	4,606,559	3,916,963
Vested and expected to vest (in shares)	5,451,862
Exercisable (in shares)	3,218,771
Weighted- Average Exercise Price
Outstanding at the beginning of the period (in dollars per share)	$ 23.06	$ 19.98
Granted (in dollars per share)	23.55	36.43
Exercised (in dollars per share)	11.47	12.90
Forfeited (in dollars per share)	29.09	34.80
Outstanding at the end of the period (in dollars per share)	23.26	$ 23.06	$ 19.98
Vested and expected to vest (in dollars per share)	23.26
Exercisable (in dollars per share)	$ 19.36
Weighted-Average Remaining Contractual Term (in years)
Outstanding at the end of the period	6 years 3 months 10 days	6 years 7 months 28 days	7 years 1 month 6 days
Vested and expected to vest	6 years 3 months 10 days
Exercisable	4 years 9 months 7 days
Aggregate Intrinsic Value (in thousands)
Outstanding	$ 29,877	$ 27,716	$ 57,220
Vested and expected to vest	29,877
Exercisable	$ 27,832

Earnings per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Income per share
Strike price of the warrant transactions (in dollars per share)	$ 80.9063
Numerator, dollars in thousands:
Net earnings	$ 126,950	$ 113,056	$ 110,993
Denominator:
Weighted average shares outstanding, basic (in shares)	52,615,269	52,412,181	51,989,824
Effect of dilutive securities:
Stock options, RSUs, and SARs (in shares)	1,074,474	1,404,573	2,109,048
Weighted average shares outstanding, diluted (in shares)	53,689,743	53,816,754	54,098,872
Earnings per share, basic (in dollars per share)	$ 2.41	$ 2.16	$ 2.13
Earnings per share, diluted (in dollars per share)	$ 2.36	$ 2.10	$ 2.05
Stock options, RSUs, PSUs
Income per share
Common stock equivalents excluded in the calculation of diluted income per share (in shares)	2,888,785	1,145,446	199,982
Convertible Debt
Income per share
Conversion price (in dollars per share)	$ 59.33

Income Taxes Expense - Components of the Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Current
Federal	$ 29,893	$ 29,333	$ 26,772
State	11,234	10,930	5,621
Deferred
Federal	2,200	(4,551)	(2,450)
State	(1,629)	(1,281)	(760)
Income tax expense	$ 41,698	$ 34,431	$ 29,183

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

Income Taxes Expense - Reconciliation of Income Tax Expense At US Federal Statutory Income Tax Rate to Effective Income Tax Rate (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Income Tax Disclosure [Abstract]
Income tax expense computed at U.S. federal statutory income tax rate	$ 35,417	$ 30,972	$ 29,437
State income taxes	7,281	7,543	3,674
Permanent items	2,654	1,332	(2,196)
Research and development credits	(3,602)	(2,071)	(3,199)
Uncertain income tax position	348	(2,992)	716
Other	(400)	(353)	751
Income tax expense	$ 41,698	$ 34,431	$ 29,183

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

Income Taxes Expense - Components of the Company's Deferred Income Tax Assets (Liabilities) (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Jun. 09, 2020	Dec. 31, 2019
Deferred tax assets:
Convertible bond hedge	$ 12,420		$ 17,197
Accrued product returns and rebates	17,529		15,123
Accrued compensation and stock based compensation	13,547		10,349
Non-recourse liability related to sale of future royalties	3,777		5,320
Research and development credit carryforwards	3,151		3,817
Amortization of intangibles	0		4,617
Net operating loss carryforwards	13,164		2,245
Operating lease liability	14,542		8,187
Other	5,303		2,510
Total deferred tax assets	83,433		69,365
Less: valuation allowance	(582)	$ (600)	(11)
Total deferred tax asset, net of valuation allowance	82,851		69,354
Deferred tax liabilities:
Amortization of intangibles	79,545		0
Debt discount on 2023 Notes	(10,190)		(14,109)
Patent infringement legal costs	(10,897)		(10,613)
Operating lease assets	(10,674)		(5,237)
Depreciation	(3,458)		(2,778)
IRC Section 481(a) liability	(315)		(2,126)
Unrealized gain on marketable securities	(2,987)		(2,428)
Total deferred tax liabilities	(118,066)		(37,291)
Net deferred tax (liabilities) assets	$ (35,215)
Net deferred tax (liabilities) assets			$ 32,063

Income Taxes Expense - Narrative (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	Jun. 09, 2020
Operating Loss Carryforwards [Line Items]
Valuation allowance related to acquisition	$ 582	$ 11		$ 600
Research and development credit carryforwards	3,500
Net tax benefit as a result of statutes of limitation	600	3,000	$ 600
Tax expense on uncertain tax positions	300	$ 200	$ 300
Tax expense related to prior year position	200
U.S. Federal
Operating Loss Carryforwards [Line Items]
NOL carryforwards	57,900
NOLs utilized	6,400
State
Operating Loss Carryforwards [Line Items]
NOL carryforwards	21,900
NOLs utilized	$ 13,600

Income Taxes Expense - Reconciliation of the Beginning and Ending Amount of Gross Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward]
Balance at beginning of period	$ 5,978	$ 8,848	$ 8,859
Gross increases related to current year tax positions	1,027	208	1,108
Gross increases related to prior year tax positions	221	0	0
Gross decreases related to prior year tax positions	0	(49)	(484)
Lapse of statute of limitations	(1,345)	(3,029)	(635)
Balance at end of period	$ 5,881	$ 5,978	$ 8,848

Leases - New Headquarters Lease (Details) - Advent Key West, LLC (Landlord) $ in Thousands	Feb. 01, 2019 USD ($)
Lessee, Lease, Description [Line Items]
Optional lease renewal term	10 years
Initial fixed monthly rental rate	$ 195
Increase in fixed monthly rental payments	2.00%
Tenant improvement allowance	$ 10,200

Leases - Finance Lease (Details) - USD ($) $ in Thousands	12 Months Ended
Leases - Finance Lease (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Jun. 09, 2020	Dec. 31, 2019
Lessee, Lease, Description [Line Items]
Finance lease asset	$ 20,874		$ 0
Finance lease liability	23,996
MDD US Enterprises LLC (Formerly USWM Enterprises)
Lessee, Lease, Description [Line Items]
Finance lease asset		$ 22,700
Finance lease liability		$ 22,700
Fixed lease cost	$ 1,900

Leases - Leases Balance Sheet Information (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Assets
Operating lease assets	$ 20,231	$ 21,279
Finance lease asset	20,874	0
Total lease assets	$ 41,105	21,279
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List]	us-gaap:OtherAssetsNoncurrent
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List]	us-gaap:PropertyPlantAndEquipmentNet
Lease liabilities, current
Operating lease liabilities, current portion	$ 3,760	2,825
Finance lease liability, long term	$ 3,761	$ 0
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List]	us-gaap:AccountsPayableAndAccruedLiabilitiesCurrent	us-gaap:AccountsPayableAndAccruedLiabilitiesCurrent
Finance Lease, Liability, Current, Statement of Financial Position [Extensible List]	us-gaap:OtherLiabilitiesCurrent
Lease liabilities, long term
Operating lease liabilities, long term	$ 28,579	$ 30,440
Finance lease liability, long term	$ 20,235	0
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List]	us-gaap:OperatingLeaseLiabilityNoncurrent
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List]	us-gaap:OtherLiabilitiesNoncurrent
Total lease liabilities	$ 56,335	$ 33,265

Leases - Lease Costs (Details) - USD ($) $ in Thousands	12 Months Ended
Leases - Lease Costs (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Operating lease cost:
Fixed lease cost	$ 5,333	$ 4,990
Variable lease cost	2,145	1,887
Total	7,478	6,877
Finance lease cost:
Amortization on finance lease asset	1,873	0
Interest on lease liability	333	0
Total	$ 2,206	$ 0

Leases - Supplemental Cash Flows (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Leases [Abstract]
Cash paid for operating leases	$ 6,949	$ 5,337
Cash paid for finance lease	802	0
Lease assets and tenant receivables obtained for new operating leases	2,478	35,594
Lease assets obtained for new finance lease	$ 22,747	$ 0

Leases - Schedule of Weighted Average Remaining Lease Term and Discount Rate Information (Details)	Dec. 31, 2020
Operating leases
Weighted-average remaining lease term (years)	11 years 8 months 12 days
Weighted-average discount rate	4.33%
Finance lease
Weighted-average remaining lease term (years)	6 years 4 months 24 days
Weighted-average discount rate	2.47%

Leases - Schedule of Maturities of Lease Liabilities (Details) $ in Thousands	Dec. 31, 2020 USD ($)
Operating Leases
2021	$ 5,066
2022	4,474
2023	2,701
2024	2,587
2025	2,638
Thereafter	24,145
Total future minimum lease payments	41,611
Less: imputed interest	(9,272)
Present value of lease liabilities	32,339
Finance Lease
2021	3,946
2022	3,665
2023	3,665
2024	3,665
2025	3,665
Thereafter	7,329
Total future minimum lease payments	25,935
Less: imputed interest	(1,939)
Present value of lease liabilities	$ 23,996

Accounts Receivable (Details) - USD ($) $ in Millions	Dec. 31, 2020	Dec. 31, 2019
Receivables [Abstract]
Allowance for expected sales discounts and allowances	$ 11.4	$ 11.0

Inventories (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Inventory Disclosure [Abstract]
Raw materials	$ 22,208	$ 4,582
Work in process	8,985	11,428
Finished goods	17,132	10,618
Total inventories	$ 48,325	$ 26,628

Inventories - Narrative (Details) - USD ($)	Dec. 31, 2020	Dec. 31, 2019
Inventory [Line Items]
Pre-launch inventory, net	$ 22,208,000	$ 4,582,000
Product Candidates
Inventory [Line Items]
Pre-launch inventory, net	$ 19,100,000	$ 0

Investments in Unconsolidated VIEs (Details) - Navitor Pharmaceuticals, Inc. - Variable Interest Entity, Not Primary Beneficiary - USD ($) $ in Millions	1 Months Ended
	Apr. 30, 2020	Dec. 31, 2020
Variable Interest Entity [Line Items]
Agreement termination notice period	30 days
Threshold for development costs payments	$ 50
Payment for option issue fee	$ 10
Investments		$ 15
VIE, qualitative or quantitative information, ownership percentage	13.00%

Property and Equipment (Details) - USD ($) $ in Thousands	12 Months Ended
Property and Equipment (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Property and equipment
Total property and equipment, gross	$ 54,864	$ 29,767
Finance lease assets	22,747	0
Less accumulated depreciation and amortization	(17,040)	(12,699)
Property and equipment, net	37,824	17,068
Depreciation and amortization expense	4,300	1,500	$ 1,900
Lab equipment and furniture
Property and equipment
Property and equipment, gross	12,526	11,053
Leasehold improvements
Property and equipment
Property and equipment, gross	15,183	14,217
Software
Property and equipment
Property and equipment, gross	2,295	2,225
Computer equipment
Property and equipment
Property and equipment, gross	2,113	1,839
Construction-in-progress
Property and equipment
Property and equipment, gross	$ 0	$ 433

Goodwill and Intangible Assets, Net - Reconciliation of Goodwill (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2020 USD ($)
Goodwill [Roll Forward]
Goodwill, beginning balance	$ 0
Goodwill, ending balance	77,911
MDD US Enterprises LLC (Formerly USWM Enterprises)
Goodwill [Roll Forward]
Goodwill, beginning balance	0
Measurement period adjustment	(10,184)
Goodwill, ending balance	$ 77,911

Goodwill and Intangible Assets, Net - Narrative (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Additional disclosures
Amortization of intangible assets	$ 15,702	$ 5,179	$ 5,190
Anticipated annual amortization expense for the next five years
2021	24,200
2022	24,200
2023	21,400
2024	21,400
2025	21,400
MDD US Enterprises LLC (Formerly USWM Enterprises)
Goodwill and Intangible Assets Disclosure [Abstract]
Measurement period adjustment	$ 10,184

Goodwill and Intangible Assets, Net - Intangible Assets Gross Carrying Amount and Related Accumulated Amortization (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Finite-Lived Intangible Assets [Line Items]
Less accumulated amortization	$ (34,237)	$ (18,535)
Total intangible assets, net	364,342	24,840
Acquired Developed Technology and Product Rights
Finite-Lived Intangible Assets [Line Items]
Intangible assets subject to amortization	232,000	0
Capitalized patent defense costs
Finite-Lived Intangible Assets [Line Items]
Intangible assets subject to amortization	43,579	43,375
Acquired In-process Research & Development
Finite-Lived Intangible Assets [Line Items]
Acquired In-process Research & Development	$ 123,000	$ 0
Minimum \| Acquired Developed Technology and Product Rights
Finite-Lived Intangible Assets [Line Items]
Remaining Weighted- Average Life (Years)	10 years
Minimum \| Capitalized patent defense costs
Finite-Lived Intangible Assets [Line Items]
Remaining Weighted- Average Life (Years)	2 years
Maximum \| Acquired Developed Technology and Product Rights
Finite-Lived Intangible Assets [Line Items]
Remaining Weighted- Average Life (Years)	12 years
Maximum \| Capitalized patent defense costs
Finite-Lived Intangible Assets [Line Items]
Remaining Weighted- Average Life (Years)	6 years 3 months

Accounts Payable and Accrued Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Payables and Accruals [Abstract]
Accrued compensation	$ 16,008	$ 11,223
Accrued royalties	13,890	0
Accrued clinical trial costs	12,842	13,285
Inventory-related accruals	9,587	1,095
Accrued professional fees	7,730	3,936
Accounts payable	6,147	10,141
Operating lease liabilities, current portion	3,760	2,825
Income taxes payable	0	2,443
Other accrued expenses	8,970	4,766
Total	$ 78,934	$ 49,714

Accrued Product Returns and Rebates (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Accrued Product Returns and Rebates
Accrued product rebates	$ 96,589	$ 88,811
Accrued product returns	29,603	18,818
Total	$ 126,192	$ 107,629

Other Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Other Liabilities Disclosure [Abstract]
Nonrecourse liability related to sale of future royalties, long term	$ 13,410	$ 19,248
Finance lease liability, long term	20,235	0
Other liabilities	9,146	9,409
Total	$ 42,791	$ 28,657

Other (Expense) Income (Details) - USD ($) $ in Thousands	12 Months Ended
Other (Expense) Income (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Other Income and Expenses [Abstract]
Interest and other income, net	$ 18,704	$ 21,623	$ 13,843
Interest expense	(19,435)	(18,207)	(13,840)
Interest expense on nonrecourse liability related to sale of future royalties	(4,319)	(4,500)	(4,271)
Total other expense	(5,050)	(1,084)	(4,268)
Amortization of deferred financing costs and debt discount	16,581	15,708	11,848
Interest earned from cash, cash equivalents, and marketable securities	$ 16,000	$ 21,300	$ 13,800

Employee Benefit Plan (Details) - USD ($) $ in Millions	12 Months Ended
Employee Benefit Plan (Details) - USD ($) $ in Millions	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Retirement Benefits [Abstract]
Minimum age requirement for employees to participate in the plan	18 years
Maximum contribution by employee (as a percent)	90.00%
Employer match of employee contributions on the first level of salary deferral (as a percent)	100.00%
Percentage of eligible compensation, first level, matched by employer	3.00%
Employer match of employee contributions on the second level of salary deferral (as a percent)	50.00%
Percentage of eligible compensation, second level, partially matched by employer	2.00%
Maximum percentage of participating employee annual compensation that the company may elect to make a discretionary contribute towards	60.00%
Company's contribution to the 401(k) Plan	$ 2.6	$ 2.3	$ 2.1

Commitments and Contingencies (Details) € in Millions, $ in Millions	1 Months Ended	12 Months Ended
	Mar. 31, 2019 USD ($)	Dec. 31, 2020 USD ($)	Dec. 31, 2020 EUR (€)	Sep. 30, 2014 USD ($)
Long-term Purchase Commitment [Line Items]
Nonrecourse liability related to sale of future royalties, long term				$ 30.0
MDD US Enterprises LLC (Formerly USWM Enterprises)
Long-term Purchase Commitment [Line Items]
Annual minimum purchase quantity requirement amount \| €			€ 3.0
Commitment period		5 years
Spend commitment amount		$ 3.7
Payment to resolve U.S. Department of Justice allegations	$ 17.5

Label	Element	Value
Accounting Standards Update [Extensible List]	us-gaap_AccountingStandardsUpdateExtensibleList	us-gaap:AccountingStandardsUpdate201609Member

Indicates amendment to accounting standards.

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