0001558370-22-002358 | 10-K | XBRL Viewer

CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) $ in Thousands	12 Months Ended
	Dec. 31, 2021 USD ($)
CONSOLIDATED STATEMENTS OF CASH FLOWS
Transaction costs	$ 373
Proceeds from common stock issuance, transaction costs	$ 391

Commitments and Contingencies (Details) - USD ($) $ in Thousands	1 Months Ended	12 Months Ended
	Oct. 31, 2021	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Collaborations and Manufacturing Commitments
Research and development		$ 151,117	$ 114,592	$ 114,522
2012 license agreement with a contract manufacturing vendor
Collaborations and Manufacturing Commitments
Specific development and sales-based milestone payments	$ 18,000
Research and development		3,000
In-process and future manufacturing of antibody, drug substance, and cytotoxic agents
Collaborations and Manufacturing Commitments
Noncancelable obligations under several agreements		7,100
Minimum
Collaborations and Manufacturing Commitments
Manufacturing commitment		$ 41,600

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Cash flows from operating activities:
Net loss	$ (139,303)	$ (44,372)	$ (104,133)
Adjustments to reconcile net loss to net cash used for operating activities:
Non-cash royalty revenue related to sale of future royalties	(39,155)	(68,529)	(47,415)
Non-cash interest expense on liability related to sale of future royalties and convertible senior notes	13,103	23,107	16,879
Depreciation and amortization	2,017	2,101	4,028
(Gain) loss on sale/disposal of fixed assets and impairment charges		(691)	1,689
Operating lease right-of-use asset impairment			600
Stock and deferred share unit compensation	17,475	14,321	14,167
Change in operating assets and liabilities:
Accounts receivable	(4,432)	7,465	(5,799)
Unbilled receivable	(2,334)	990	(384)
Contract asset	(3,000)	3,631	(3,131)
Prepaid and other current assets	579	(2,476)	(963)
Operating lease right-of-use assets	1,680	1,515	1,331
Other assets	2,275	(7,202)	(75)
Accounts payable	9,148	(819)	(1,045)
Accrued compensation	849	(4,100)	(2,189)
Other accrued liabilities	(7,261)	16,734	(6,146)
Deferred revenue	(18,041)	(17,323)	46,630
Operating lease liability	(3,016)	(2,972)	(2,505)
Net cash used for operating activities	(169,416)	(78,620)	(88,367)
Cash flows from investing activities:
Purchases of property and equipment	(1,434)	(917)	(2,845)
Proceeds from sale of equipment		1,426	2,312
Net cash (used for) provided by investing activities	(1,434)	509	(533)
Cash flows from financing activities:
Payments upon settlement of convertible senior notes	(1,100)
Proceeds from issuance of common stock under stock plans	3,769	1,471	2,873
Proceeds from warrant issuance, net of $391 of transaction costs	199,045
Proceeds from common stock issuance, net of $373 and $701 of transaction costs, respectively	154,030	194,271
Net cash provided by financing activities	355,744	195,742	2,873
Net change in cash and cash equivalents	184,894	117,631	(86,027)
Cash and cash equivalents, beginning of period	293,856	176,225	262,252
Cash and cash equivalents, end of period	478,750	293,856	176,225
Supplemental cash flow information:
Cash paid during the year for interest	$ 47	$ 95	$ 95

Nature of Business and Plan of Operations (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Net loss	$ (139,303)	$ (44,372)	$ (104,133)
Accumulated deficit	(1,471,143)	(1,331,840)
Total revenues	69,856	132,299	$ 82,271
Cash and cash equivalents	$ 478,750	$ 293,856
Number of months Capital resources meets capital expenditures	12 months
Product
Total revenues	$ 0

- Definition

The consolidated profit or loss for the period, net of income taxes, including the portion attributable to the noncontrolling interest.

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+ Details

- Definition

The cumulative amount of the reporting entity's undistributed earnings or deficit.

+ References + Details

- Definition

Amount, including 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.

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+ Details

Agreements - Viridian (Details) - USD ($) $ in Thousands	1 Months Ended	2 Months Ended	12 Months Ended
Agreements - Viridian (Details) - USD ($) $ in Thousands	Oct. 31, 2021	Dec. 31, 2021	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Oct. 31, 2020
Collaborative Agreements disclosures
Revenue from contract with customer			$ 69,856	$ 132,299	$ 82,271
License and milestone fees
Collaborative Agreements disclosures
Revenue from contract with customer			22,650	$ 63,742	$ 34,788
Viridian \| License and milestone fees
Collaborative Agreements disclosures
Revenue from contract with customer			200
Potential milestone payment		$ 5,500	5,500			$ 143,000
Viridian \| License and milestone fees \| Development milestones
Collaborative Agreements disclosures
Revenue from contract with customer	$ 2,500	$ 3,000	$ 2,500

- Definition

+ References

+ Details

Summary of Significant Accounting Policies - Performance Obligations (Details) - USD ($) $ in Millions	Dec. 31, 2021	Dec. 31, 2020
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation	$ 92.1
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligations, percent	48.00%
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligations, percent	41.00%
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2031-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligations, percent	11.00%
Minimum \| Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation, expected timing of satisfaction	12 months
Minimum \| Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation, expected timing of satisfaction	13 months
Minimum \| Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2031-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation, expected timing of satisfaction		61 months
Maximum \| Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation, expected timing of satisfaction	60 months
Maximum \| Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2031-01-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation, expected timing of satisfaction		120 months

Summary of Significant Accounting Policies - Computation of Net Loss per Common Share (Details) shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2021 shares	Dec. 31, 2020 USD ($) shares	Dec. 31, 2019 USD ($) shares
Computation of Net Loss per Common Share
Options outstanding to purchase common stock, shares issuable under the employee stock purchase plan, and unvested restricted stock/units at end of period	21,296	18,459	14,815
Common stock equivalents under treasury stock method for options, shares issuable under the employee stock purchase plan, and unvested restricted stock/units	2,546	1,301	1,020
Shares issuable upon conversion of convertible notes at end of period (in shares) \| $		501	501
Common stock equivalents under if-converted method for convertible notes (in shares)		501	501

Leases - Maturities of Operating Lease Liabilities (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2021 USD ($)
Leases
2022	$ 5,363
2023	5,503
2024	5,522
2025	5,543
2026	1,429
Thereafter	13
Total lease payments	23,373
Less imputed interest	(4,592)
Total lease liabilities	18,781
Variable operating costs and real estate taxes	$ 3,400

Restructuring Charges (Tables)

12 Months Ended

Dec. 31, 2021

Restructuring Charges

Summary of payments made against the restructuring charge related to the employee terminations


		Employee
		Termination
		Benefits Costs
Balance at December 31, 2020	$	784
Additional charges/adjustments during the period		—
Payments during the period		(443)
Balance at December 31, 2021	$	341

Summary of Significant Accounting Policies - Other Accrued Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Other Accrued Liabilities
Accrued contract payments	$ 5,558	$ 15,576
Accrued clinical trial costs	15,556	11,401
Accrued professional services	839	1,200
Accrued employee benefits	40	39
Accrued public reporting charges	309	319
Other current accrued liabilities	775	785
Total	$ 23,077	$ 29,320

Summary of Significant Accounting Policies - Non-cash Investing and Financing Activities (Details) $ in Thousands		3 Months Ended	12 Months Ended
	Jul. 01, 2021 USD ($)	Jun. 30, 2021 USD ($) shares	Dec. 31, 2021 USD ($) item shares	Dec. 31, 2020 USD ($)	Dec. 31, 2017
Debt Instrument [Line Items]
Interest rate (as a percent)			4.50%	4.50%
Accrued capital expenditures			$ 200	$ 700
Number of trades \| item			0
Payments upon settlement of convertible senior notes	$ 1,100		$ 1,100
Convertible 4.5% Senior Notes
Debt Instrument [Line Items]
Interest rate (as a percent)			4.50%	4.50%	4.50%
Shares issued with debt conversion (in shares) \| shares		238,777
Conversion of debt (in shares) \| shares			238,777
Payments upon settlement of convertible senior notes		$ 1,100

Property and Equipment

12 Months Ended

Dec. 31, 2021

Property and Equipment

Property and Equipment

D.Property and Equipment

Property and equipment consisted of the following at December 31, 2021 and 2020 (in thousands):


	December 31,		December 31,
	2021		2020
Leasehold improvements	$	22,051	$	21,890
Machinery and equipment		2,955		2,861
Computer hardware and software		5,846		5,636
Furniture and fixtures		3,265		3,039
Assets under construction		233		97
	$	34,350	$	33,523
Less accumulated depreciation		(29,687)		(27,763)
Property and equipment, net	$	4,663	$	5,760

Included in the table above are amounts capitalized for equipment under capital leases at December 31, 2021 and 2020 totaling $2.1 million, net of accumulated amortization of $1.6 million and $1.3 million, respectively. Depreciation expense was $2.0 million, $2.1 million , and $4.0 million for the years ended December 31, 2021, 2020 and 2019, respectively. As a result of the restructuring at the end of the second quarter of 2019, the Company recorded an impairment charge of $2.5 million to write down excess equipment to fair value. During the fourth quarter of 2019, the Company executed an agreement to liquidate the equipment and transferred title to assets with a cost basis of $14.2 million and accumulated depreciation of $12.9 million, for which the Company received a $2 million payment. During the year ended December 31, 2020, the Company liquidated the remaining equipment with a cost basis of $6.7 million for an additional $1.2 million payment to the Company.

Agreements - CytomX (Details) - USD ($) $ in Thousands	1 Months Ended	12 Months Ended
Agreements - CytomX (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Jun. 30, 2016
Collaborative Agreements disclosures
Revenue from contract with customer		$ 69,856	$ 132,299	$ 82,271
Research and development support
Collaborative Agreements disclosures
Revenue from contract with customer		398	28	68
License and milestone fees
Collaborative Agreements disclosures
Revenue from contract with customer		22,650	63,742	$ 34,788
License and milestone fees \| CytomX
Collaborative Agreements disclosures
Revenue from contract with customer	$ 7,300	4,000
License and milestone fees \| CytomX \| Maximum
Collaborative Agreements disclosures
Contract with Customer, Asset, Gross		$ 355,000
License and milestone fees \| CytomX \| Phase II clinical trial
Collaborative Agreements disclosures
Cost of Goods Sold			$ 3,000
License and milestone fees \| CytomX \| Sales milestones
Collaborative Agreements disclosures
Contract with Customer, Asset, Gross					$ 160,000

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (DEFICIT) - USD ($) shares in Thousands, $ in Thousands	Common Stock	Additional Paid-In Capital	Accumulated Deficit	Total
Balance at Dec. 31, 2018	$ 1,494	$ 1,192,813	$ (1,183,335)	$ 10,972
Balance (in shares) at Dec. 31, 2018	149,400
Increase (Decrease) in Shareholders' Equity (Deficit)
Net loss			(104,133)	(104,133)
Issuance of common stock pursuant to the exercise of stock options and employee stock purchase plan	$ 11	2,862		2,873
Issuance of common stock pursuant to the exercise of stock options and employee stock purchase plan (in shares)	1,150
Stock option and restricted stock compensation expense		13,830		13,830
Restricted stock award forfeitures	$ (4)	4
Restricted stock award forfeitures (in shares)	(414)
Directors' deferred share unit compensation		337		337
Balance at Dec. 31, 2019	$ 1,501	1,209,846	(1,287,468)	(76,121)
Balance (in shares) at Dec. 31, 2019	150,136
Increase (Decrease) in Shareholders' Equity (Deficit)
Net loss			(44,372)	(44,372)
Issuance of common stock pursuant to the exercise of stock options and employee stock purchase plan	$ 5	1,466		1,471
Issuance of common stock pursuant to the exercise of stock options and employee stock purchase plan (in shares)	458
Issuance of common stock, net of issuance costs	$ 445	193,826		194,271
Issuance of common stock, net of issuance costs (in shares)	44,496
Stock option and restricted stock compensation expense		13,978		13,978
Restricted stock units vested	$ 4	(4)
Restricted stock units vested (in shares)	395
Restricted stock award forfeitures	$ (5)	5
Restricted stock award forfeitures (in shares)	(487)
Directors' deferred share unit compensation		343		343
Balance at Dec. 31, 2020	$ 1,950	1,419,460	(1,331,840)	$ 89,570
Balance (in shares) at Dec. 31, 2020	194,998			194,998
Increase (Decrease) in Shareholders' Equity (Deficit)
Net loss			(139,303)	$ (139,303)
Issuance of common stock pursuant to the exercise of stock options and employee stock purchase plan	$ 10	3,759		3,769
Issuance of common stock pursuant to the exercise of stock options and employee stock purchase plan (in shares)	998
Issuance of common stock, net of issuance costs	$ 242	153,788		154,030
Issuance of common stock, net of issuance costs (in shares)	24,181
Issuance of pre-funded warrants, net of issuance costs		199,045		199,045
Stock option and restricted stock compensation expense		16,794		16,794
Directors' deferred share units converted		681		681
Restricted stock units vested (in shares)	2
Restricted stock award forfeitures	$ (1)	1
Restricted stock award forfeitures (in shares)	(57)
Conversion of debt	$ 3	997		1,000
Conversion of debt (in shares)	239
Balance at Dec. 31, 2021	$ 2,204	$ 1,794,525	$ (1,471,143)	$ 325,586
Balance (in shares) at Dec. 31, 2021	220,361			220,361

Summary of Significant Accounting Policies - Cash and Cash Equivalents (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Basis of Presentation and Significant Accounting Policies
Cash and cash equivalents	$ 478,750	$ 293,856

Property and Equipment (Details) - USD ($) $ in Thousands	3 Months Ended		12 Months Ended
Property and Equipment (Details) - USD ($) $ in Thousands	Dec. 31, 2019	Jun. 30, 2019	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Property and Equipment
Property and equipment, gross			$ 34,350	$ 33,523
Less accumulated depreciation			(29,687)	(27,763)
Property and equipment, net			4,663	5,760
Depreciation expense			2,017	2,101	$ 4,028
Impairment charge to write down excess equipment to fair value		$ 2,500
Equipment liquidate amount	$ 2,000
Agreement to liquidate equipment, cost basis	14,200			6,700
Accumulated depreciation and impairment charges for liquidated equipment	$ 12,900
Payment from equipment held for sale				1,200
Leasehold improvements
Property and Equipment
Property and equipment, gross			22,051	21,890
Machinery and equipment
Property and Equipment
Property and equipment, gross			2,955	2,861
Computer hardware and software
Property and Equipment
Property and equipment, gross			5,846	5,636
Furniture and fixtures
Property and Equipment
Property and equipment, gross			3,265	3,039
Assets under construction
Property and Equipment
Property and equipment, gross			233	97
Equipment under capital leases
Property and Equipment
Property and equipment, gross			2,100	2,100
Less accumulated depreciation			$ (1,600)	$ (1,300)

Summary of Significant Accounting Policies - Subsequent Events (Details) - USD ($) $ in Thousands		12 Months Ended
	Feb. 14, 2022	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Subsequent Event [Line Items]
Revenue from contract with customer		$ 69,856	$ 132,299	$ 82,271
Subsequent event \| Lilly
Subsequent Event [Line Items]
License agreement upfront payment receivable	$ 13,000
License agreement additional target term	4 years
License agreement, target selection fees and development, regulatory and commercial milestone payments receivable	$ 1,700
Subsequent event \| Lilly \| Maximum
Subsequent Event [Line Items]
License agreement additional payment receivable	$ 32,500
Upfront payment \| CytomX
Subsequent Event [Line Items]
Revenue from contract with customer		$ 7,500		$ 7,500

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2021

Income Taxes

Reconciliation of the Company's expected tax benefit, as computed by applying the U.S. federal corporate tax rate to loss before the benefit for income taxes, and actual tax

The difference between the Company’s expected tax benefit, as computed by applying the applicable U.S. federal corporate tax rate to loss before the benefit for income taxes, and actual tax is reconciled in the following table (in thousands):


	Years Ended December 31,
	2021		2020		2019
Loss before income tax expense	$	(139,303)	$	(44,372)	$	(104,133)
Expected tax benefit at 21%	$	(29,254)	$	(9,318)	$	(21,868)
Permanent differences		606		157		320
Incentive stock options		420		201		569
State tax benefit net of federal benefit		(7,376)		(2,250)		(6,726)
Change in valuation allowance, net		46,987		15,175		27,812
Federal research credit		(575)		(228)		(1,652)
Federal orphan drug credit		(7,429)		(6,218)		(4,426)
Expired loss and credit carryforwards		345		419		500
Withholding tax credit		(4,789)		—		—
Stock option expirations		1,065		2,062		5,471
Benefit for income taxes	$	—	$	—	$	—

Schedule of significant components of deferred tax assets


	December 31,
	2021		2020
Deferred tax assets:
Net operating loss carryforwards	$	264,773	$	220,286
Research and development tax credit carryforwards		92,832		80,694
Property and other intangible assets		1,150		871
Deferred revenue		25,153		30,082
Stock-based compensation		12,286		9,940
Operating lease liability		5,170		6,033
Other liabilities		1,737		1,514
Royalty sale		10,247		17,455
Total deferred tax assets	$	413,348	$	366,875

Deferred tax liabilities:
Stock-based compensation		(91)		(58)
Operating lease right of use asset		(3,386)		(3,844)
Royalty sale transaction costs		(158)		(247)
Total deferred tax liabilities	$	(3,635)	$	(4,149)
Valuation allowance		(409,713)		(362,726)
Net deferred tax assets/(liabilities)	$	—	$	—

Agreements - AmgenOxford BioTherapeutics (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Oct. 31, 2013
Collaborative Agreements disclosures
Revenue from contract with customer	$ 69,856	$ 132,299	$ 82,271
Amgen
Collaborative Agreements disclosures
Revenue from contract with customer	1,000
Upfront payment \| Amgen
Collaborative Agreements disclosures
Revenue from contract with customer	1,000
License and milestone fees
Collaborative Agreements disclosures
Revenue from contract with customer	$ 22,650	$ 63,742	$ 34,788
License and milestone fees \| Amgen
Collaborative Agreements disclosures
Potential milestone payment				$ 34,000

- Definition

+ References

+ Details

Summary of Significant Accounting Policies - Leases (Details) $ in Thousands	Dec. 31, 2021 USD ($)
Commitments and Contingencies
Obligations under finance leases	$ 0

Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2021

Basis of Presentation and Significant Accounting Policies

Principles of Consolidation

Principles of Consolidation

The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, ImmunoGen Securities Corp., ImmunoGen Europe Limited, ImmunoGen BioPharma (Ireland) Limited, and Hurricane, LLC. All intercompany transactions and balances have been eliminated.

Use of Estimates

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States (U.S.) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Subsequent Events

Subsequent Events

The Company has evaluated all events or transactions that occurred after December 31, 2021 up through the date the Company issued these financial statements. On February 14, 2022, the Company and Eli Lilly and Company (“Lilly”) entered into a license agreement, pursuant to which the Company granted Lilly worldwide exclusive rights to research, develop, and commercialize ADCs based on the Company’s novel camptothecin technology. Under the terms of the license agreement, the Company is entitled to receive an upfront payment of $13 million, reflecting initial targets selected by Lilly, and up to an additional $32.5 million if Lilly selects the maximum number of additional targets over the four year-period following the effective date of the license agreement. In addition, Lilly will be obligated to pay the Company, on a target-by-target basis, development, regulatory, and commercial milestones. In total, the Company could earn up to $1.7 billion in target selection fees and development, regulatory, and commercial milestones if all targets are selected and all milestones are realized. The Company is also eligible to receive tiered royalties, on a product-by-product basis, as a percentage of worldwide annual net sales by Lilly, based on certain net sales thresholds. The Company did not have any other material subsequent events.

Revenue Recognition

Revenue Recognition

The Company enters into licensing and development agreements with collaborators for the development of ADCs. The terms of these agreements contain multiple promised goods and services which may include (i) licenses, or options to obtain licenses, to the Company’s ADC technology, (ii) rights to future technological improvements, (iii) technology transfer services and other activities to be performed on behalf of the collaborative partner, and (iv) delivery of cytotoxic agents and/or the manufacture of preclinical and clinical materials for the collaborative partner. Payments to the Company under these agreements may include upfront fees, option fees, exercise fees, payments for services, payments for preclinical or clinical materials, payments based upon the achievement of certain milestones, and royalties on product sales. The Company follows the provisions of ASC 606, Revenue from Contracts with Customers, in accounting for these agreements.

Revenue is recognized when a customer obtains control of promised goods or services in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. In determining the appropriate amount of revenue to be recognized as it fulfills its obligations under the agreements, the Company performs the following five steps: (i) identification of the promised goods or services in the contract; (ii) determination of whether the promised goods or services are performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when or as the Company satisfies each performance obligation.

The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration to which it is entitled in exchange for the goods or services it transfers to the customer. At contract inception, once the contract is determined to be within the scope of ASC 606, the Company assesses the goods or services promised within each contract and determines those that are performance obligations based on its assessment of whether each promised good or service is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when or as the performance obligation is satisfied.

The Company exercises judgment in assessing those promised goods and services that are distinct and thus representative of performance obligations. To the extent the Company identifies multiple performance obligations in a contract, the Company must develop assumptions that require judgment to determine the estimated standalone selling price for each performance obligation in order to allocate the transaction price among the identified performance obligations. These judgments and assumptions are discussed in further detail below.

At December 31, 2021, the Company had the following types of material agreements with the parties identified below:

●

Development and commercialization licenses, which provide the counterparty with the right to use the Company’s ADC technology and/or certain other intellectual property to develop and commercialize compounds to a specified antigen target:

Bayer (one exclusive single-target license)

CytomX (two exclusive single-target licenses)

Debiopharm (one exclusive single-compound license)

Fusion Pharmaceuticals (one exclusive single-target license)

Hangzhou Zhongmei Huadong Pharmaceutical Co., Ltd. (one territory-specific exclusive single-compound license)

Novartis (five exclusive single-target licenses)

Oxford BioTherapeutics/Menarini (one exclusive single-target license sublicensed from Amgen)

Roche, through its Genentech unit (five exclusive single-target licenses)

Viridian (one exclusive single-target license)

●

Collaboration and license agreement to co-develop and co-commercialize a specified anticancer compound on established terms:

MacroGenics

During the year ended December 31, 2020, pursuant to notices received, the exclusive development and commercialization licenses granted to each of Biotest and Takeda and the collaboration and option agreement with Jazz were terminated.

There are no performance, cancellation, termination, or refund provisions in any of the arrangements that contain material financial consequences to the Company.

Development and Commercialization Licenses

The obligations under a development and commercialization license agreement generally include the license to the Company’s ADC technology with respect to a specified antigen target or compound and may also include obligations related to rights to future technological improvements and other activities to be performed on behalf of the collaborative partner.

Generally, development and commercialization licenses contain non-refundable terms for payments and, depending on the terms of the agreement, provide that the Company will earn payments upon the achievement of certain milestones and royalty payments, generally until the later of the last applicable patent expiration or a fixed period of years after product launch. Royalty rates may vary over the royalty term depending on the Company’s intellectual property rights and/or the presence of comparable competing products. In the case of Debiopharm, no royalties will be received. In certain instances, the Company may also provide cytotoxic agents and/or clinical materials or other services in addition to the development and commercialization licenses. For example, the Company may provide technology transfer services in connection with the out-licensing of product candidates initially developed by the Company and may also provide technical assistance and share any technology improvements with its collaborators during the term of the collaboration agreements. The Company does not directly control when or whether any collaborator will request certain services, achieve milestones, or become liable for royalty payments.

In determining the performance obligations for these arrangements, management evaluates whether the license is distinct and has significant standalone functionality either alone or with other readily available resources based on the consideration of the relevant facts and circumstances for each arrangement. Factors considered in this determination include the research capabilities of the partner and the availability of ADC technology research expertise and ADC manufacturing capabilities in the general marketplace and whether technological improvements are required for the continued functionality of the license. If the license to the Company’s intellectual property is determined to be distinct, the Company recognizes revenues from non-refundable, upfront fees allocated to the license when the license is transferred to the customer and the customer is able to use and benefit from the license. If the license is not distinct, the license is combined with other goods or services into a single performance obligation and revenue is recognized over time.

The Company estimates the standalone selling prices of the license and all other performance obligations based on market conditions, similar arrangements entered into by third parties, and entity-specific factors such as the terms of the Company’s previous collaborative agreements, recent preclinical and clinical testing results of therapeutic products that use the Company’s ADC technology, the Company’s pricing practices and pricing objectives, the likelihood that technological improvements will be made, and, if made, will be used by the Company’s collaborators, and the nature of the other services to be performed on behalf of its collaborators and market rates for similar services.

The Company recognizes revenue related to technology transfer activities and other services as the services are performed. The Company is generally compensated for these activities at negotiated rates that are consistent with what other third parties would charge. The Company records amounts recognized for services performed as a component of research and development support revenue.

The Company may also provide cytotoxic agents and/or preclinical and clinical materials (drug substance/drug product) to its collaborators at negotiated prices generally consistent with what other third parties would charge. The Company recognizes revenue on cytotoxic agents and/or preclinical and clinical materials when control transfers to the collaborator as a component of research and development support revenue.

The Company recognizes revenue related to the rights to future technological improvements over the estimated term of the applicable license.

The Company’s development and commercialization license agreements have milestone payments which for reporting purposes are aggregated into two categories: (i) development and regulatory milestones, and (ii) sales milestones. Development milestones are typically payable when a product candidate initiates or advances into different clinical trial phases. Regulatory milestones are typically payable upon submission for marketing approval with the FDA

or other countries’ regulatory authorities or on receipt of actual marketing approvals for the compound or for additional indications. Sales milestones are typically payable when annual sales reach certain levels.

At the inception of each arrangement, the Company evaluates any development and regulatory milestone payments to determine whether the milestone is considered probable of being reached and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is included in the transaction price to be allocated; otherwise, such amounts are considered constrained and excluded from the transaction price. As part of its evaluation of the constraint, the Company considers numerous factors, including whether the achievement of the milestone is outside the control of the Company and contingent upon the future success of clinical trials, the collaborator’s efforts, or the receipt of regulatory approval. At the end of each subsequent reporting period, the Company re-evaluates the probability of achievement of such development or regulatory milestones and any related constraint, and if necessary, adjusts the estimate of the transaction price. In addition, the Company evaluates whether the achievement of each milestone specifically relates to the Company’s efforts to satisfy a performance obligation or transfer a distinct good or service within a performance obligation. If the achievement of a milestone is considered a direct result of the Company’s efforts to satisfy a performance obligation or transfer a distinct good or service and the receipt of the payment is based upon the achievement of the milestone, the associated milestone value is allocated to that distinct good or service. If the milestone payment is not specifically related to the Company’s effort to satisfy a performance obligation or transfer a distinct good or service, the amount is allocated to all performance obligations using the relative standalone selling price method. Amounts allocated to a satisfied performance obligation are recognized as revenue, or as a reduction of revenue, in the period in which the transaction price changes.

For development and commercialization license agreements that include sales-based royalties, including milestone payments based on the level of sales, and the license is deemed to be the predominant item to which the royalties relate, the Company recognizes revenue at the later of (i) when the related sales occur, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied) in accordance with the royalty recognition constraint. Under the Company’s development and commercialization license agreements, except for the Debiopharm license, the Company receives royalty payments based upon its licensees’ net sales of covered products. Generally, under the development and commercialization agreements, the Company receives royalty reports and payments from its licensees approximately one quarter in arrears. The Company estimates the amount of royalty revenue to be recognized based on historical and forecasted sales and/or sales information from its licensees if available.

Collaboration and Option Agreements/Right-to-Test Agreements

The Company’s right-to-test agreements provide collaborators the right to test the Company’s ADC technology for a defined period of time through a research, or right-to-test, license. Under both right-to-test agreements and collaboration and option agreements, collaborators may (a) “take” options, for a defined period of time, to specified targets and (b) upon exercise of those options, secure or “take” licenses to develop and commercialize products for the specified targets on established terms. Under these agreements, fees may be due to the Company (i) at the inception of the arrangement (referred to as “upfront” fees or payments), (ii) upon the opt-in to acquire a development and commercialization license(s) (referred to as exercise fees or payments earned, if any, when the development and commercialization license is “taken”), (iii) after providing services at the collaborator’s request at negotiated prices, which are generally consistent with what other third parties would charge, or (iv) upon some combination of all of these fees.

The accounting for collaboration and option agreements and right-to-test agreements is dependent on the nature of the options granted to the collaborative partner. Options are considered distinct performance obligations if they provide a collaborator with a material right. Factors that are considered in evaluating whether options convey a material right include the overall objective of the arrangement, the benefit the collaborator might obtain from the agreement without exercising the options, the cost to exercise the options relative to the fair value of the licenses, and the additional financial commitments or economic penalties imposed on the collaborator as a result of exercising the options.

If the Company concludes that an option provides the customer a material right, and therefore is a separate performance obligation, the Company then determines the estimated standalone selling price of the option using the following inputs: (a) estimated fair value of the license underlying each option, (b) the amount the partner would pay to exercise the option to obtain the license, and (c) probability of exercise.

The Company does not control when or if any collaborator will exercise its options for development and commercialization licenses. As a result, the Company cannot predict when or if it will recognize revenues in connection with any of the foregoing.

Upfront payments on development and commercialization licenses may be recognized upon delivery of the license if facts and circumstances dictate that the license is distinct from the other promised goods and services.

In determining whether a collaboration and option agreement is within the scope of ASC 808, Collaborative Arrangements, management evaluates the level of involvement of both companies in the development and commercialization of the products to determine if both parties are active participants and if both parties are exposed to risks and rewards dependent on the commercial success of the licensed products. If the agreement is determined to be within the scope of ASC 808 and not representative of a vendor-customer relationship, the Company segregates the research and development activities and the related cost sharing arrangement. Payments made by the Company for such activities are recorded as research and development expense and reimbursements received from the partner are recognized as an offset to research and development expense.

Transaction Price Allocated to Remaining Performance Obligations

Deferred revenue under ASC 606 represents the portion of the transaction price received under various contracts for which work has not been performed (or has been partially performed) and includes unexercised contract options that are considered material rights. As of December 31, 2021, the aggregate amount of the transaction price allocated to remaining performance obligations comprising deferred revenue was $92.1 million. The Company expects to recognize revenue on approximately 48%, 41%, and 11% of the remaining performance obligations over the next 12 months, 13 to 60 months, and 61 to 120 months, respectively, however, it does not control when or if any collaborator will terminate existing development and commercialization licenses.

Contract Balances from Contracts with Customers

The following tables present changes in the Company’s contract assets and contract liabilities during the years ended December 31, 2021 and 2020 (in thousands):


	Balance at								Balance at
Year ended December 31, 2021	December 31, 2020		Additions		Deductions		Impact of Netting		December 31, 2021
Contract asset	$	—	$	5,500	$	(2,500)	$	—	$	3,000
Contract liabilities (deferred revenue)	$	110,109	$	4,753	$	(22,794)	$	—	$	92,068



	Balance at								Balance at
Year ended December 31, 2020	December 31, 2019		Additions		Deductions		Impact of Netting		December 31, 2020
Contract asset	$	3,631	$	—	$	(8,000)	$	4,369	$	—
Contract liabilities (deferred revenue)	$	127,432	$	42,050	$	(63,742)	$	4,369	$	110,109

During the years ended December 31, 2021, 2020, and 2019 the Company recognized the following revenues as a result of changes in contract asset and contract liability balances in the respective periods (in thousands):


	Year Ended
	December 31,
	2021		2020		2019
Revenue recognized in the period from:
Amounts included in contract liabilities at the beginning of the period	$	22,765	$	61,872	$	14,817
Performance obligations satisfied in previous periods	$	5,500	$	—	$	12,672

Pursuant to the Company’s license agreement executed with Hangzhou Zhongmei Huadong Pharmaceutical Co., Ltd. (Huadong), upon delivery of clinical materials in 2021, the Company recorded $14.6 million of the $40.0 million upfront payment received and deferred in 2020 as license and milestone fee revenue. Additionally, in December 2021, the Company received a $5.0 million payment for a development milestone achieved pursuant to its agreement with Huadong, of which $1.8 million was recorded as license and milestone fee revenue in 2021 and $3.2 million was deferred and will be recorded as revenue, along with the remaining $25.4 million from the upfront license fee, upon delivery of clinical material in 2022. Also, during 2021, pursuant to its license agreement with Viridian, the Company recorded $2.5 million as license and milestone fee revenue related to a development milestone achieved in October 2021 and a contract asset of $3.0 million for a second probable development milestone. The Company also recorded $0.2

million as license and milestone fee revenue for delivery of certain materials to Viridian that had been previously deferred, $0.3 million of license and milestone fee revenue related to numerous collaborators’ rights to technological improvements that had been previously deferred, and recorded $7.7 million of previously deferred non-cash royalty revenue related to the sale of rights to KADCYLA royalties, further details of which can be found in Note E, “Liability Related to Sale of Future Royalties.” Lastly, pursuant to a research agreement, the Company received a $1.6 million upfront option fee that is included in deferred revenue at December 31, 2021.

During 2020, the Company recognized $60.5 million of previously deferred license revenue upon Jazz’s opt-out of its right to the last remaining license under the agreement and $3.2 million of upfront fees previously received from other partners, of which $1.4 million was included in contract liabilities at the beginning of 2020. As noted above, a $40.0 million upfront payment received in 2020 pursuant to a license agreement executed with Huadong was recorded as deferred revenue and none of this amount was recognized as revenue during 2020. Additionally, a contract asset of $3.6 million, net of $4.4 million in related contract liabilities, was recorded for two probable milestones in 2019 pursuant to license agreements with CytomX and Novartis, which were subsequently achieved and paid during 2020.

The Company recorded the following during the year ended December 31, 2019: (i) license and milestone fee revenue of $7.7 million for probable development milestones pursuant to license agreements with CytomX and Novartis, with another $0.3 million deferred which represents the amount allocated to future rights to technological improvements; a $3.6 million contract asset was recorded in December 2019 related to these probable milestones, net of a $4.4 million reduction in related contract liabilities; (ii) a $5.0 million regulatory milestone payment earned under its license agreement with Genentech, a member of Roche; the full amount of the milestone was recognized as revenue in the period as the amount allocated to future rights to technological improvements was not material; (iii) $14.5 million of previously deferred license revenue recognized upon the opt-out of the right to execute a license by Jazz; (iv) $65.2 million was recorded as deferred revenue as a result of a sale of the Company’s residual rights to receive royalty payments on commercial sales of KADCYLA^® (ado-trastuzumab emtansine) as discussed in Note F; and (v) $0.3 million of revenue previously deferred related to numerous collaborators’ rights to technological improvements. Additionally, $7.3 million of a $7.5 million upfront payment invoiced to CytomX pursuant to a license agreement executed in December 2019 was recorded as license and milestone fee revenue upon delivery of the license and $0.2 million was deferred until delivery of certain materials.

The timing of revenue recognition, billings, and cash collections results in billed receivables, unbilled receivables, contract assets, and contract liabilities on the consolidated balance sheets. When consideration is received, or such consideration is unconditionally due, from a customer prior to transferring goods or services to the customer under the terms of a contract, a contract liability is recorded (under the caption deferred revenue). Contract liabilities are recognized as revenue after control of the products or services is transferred to the customer and all revenue recognition criteria have been met.

Financial Instruments and Concentration of Credit Risk

Financial Instruments and Concentration of Credit Risk

Cash and cash equivalents are primarily maintained with three financial institutions in the U.S. Deposits with banks may exceed the amount of insurance provided on such deposits. Generally, these deposits may be redeemed upon demand and, therefore, bear minimal risk. The Company’s cash equivalents consist of money market funds with underlying investments primarily being U.S. Government-issued securities and high quality, short-term commercial paper. Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash, cash equivalents, and marketable securities. The Company held no marketable securities as of December 31, 2021 or 2020. The Company’s investment policy, approved by the Board of Directors, limits the amount it may invest in any one type of investment, thereby reducing credit risk concentrations.

Cash and Cash Equivalents

Cash and Cash Equivalents

All highly liquid financial instruments with maturities of three months or less when purchased are considered cash equivalents. As of December 31, 2021 and 2020, the Company held $478.8 million and $293.9 million, respectively, in cash and money market funds consisting principally of U.S. Government-issued securities and high quality, short-term commercial paper which were classified as cash and cash equivalents.

Non-cash Investing Activities

Non-cash Investing Activities

The Company had $0.2 million and $0.7 million of accrued capital expenditures as of December 31, 2021 and 2020, respectively, which have been treated as a non-cash investing activity and accordingly, not reflected in the consolidated statement of cash flows.

Fair Value of Financial Instruments

Fair Value of Financial Instruments

ASC 820, Fair Value Measurement, defines fair value, establishes a framework for measuring fair value in accordance with accounting principles generally accepted in the U.S., and provides for disclosures about fair value measurements. Fair value is defined under ASC 820 as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The standard describes a hierarchy to measure fair value which is based on three levels of inputs, of which the first two are considered observable and the last unobservable, as follows:

●

Level 1—Quoted prices in active markets for identical assets or liabilities.

●

Level 2—Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

●

Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

As of December 31, 2021 and 2020, the Company held certain assets that are required to be measured at fair value on a recurring basis. The following tables represent the fair value hierarchy for the Company’s financial assets measured at fair value on a recurring basis as of each date (in thousands):

Fair Value Measurements at December 31, 2021

Quoted Prices in

Significant

Active Markets for

Significant Other

Unobservable

Identical Assets

Observable Inputs

Inputs

Total

(Level 1)

(Level 2)

(Level 3)

Cash equivalents

460,298

—

Fair Value Measurements at December 31, 2020

Quoted Prices in

Significant

Active Markets for

Significant Other

Unobservable

Identical Assets

Observable Inputs

Inputs

Total

(Level 1)

(Level 2)

(Level 3)

Cash equivalents

194,525

—

The fair value of the Company’s cash equivalents is based primarily on quoted prices from active markets.

The carrying amounts reflected in the consolidated balance sheets for accounts receivable, unbilled receivable, contract assets, non-cash royalty receivable, prepaid and other current assets, accounts payable, accrued compensation, and other accrued liabilities approximate fair value due to their short-term nature. The gross carrying amount and estimated fair value of the convertible 4.5% senior notes was $2.1 million and $4.3 million, respectively, as of December 31, 2020. The fair value of the convertible notes was influenced by interest rates, the Company’s stock price and stock price volatility, and by prices observed in trading activity for the convertible notes. However, because there have been no trades involving the convertible notes since September 2019, the fair value as of December 31, 2020 uses Level 3 inputs. During 2021, $1.0 million of outstanding convertible 4.5% senior notes converted into 238,777 shares of the Company’s common stock, par value $0.01 per share (common stock), with the remaining $1.1 million of convertible 4.5% senior notes paid in cash upon maturity on July 1, 2021.

Unbilled Receivable

Unbilled receivable primarily represents research funding earned based on actual resources utilized and external expenses incurred under certain of the Company’s collaborator agreements.

Clinical Trial Accruals

Clinical Trial Accruals

Clinical trial expenses are a significant component of research and development expenses, and the Company outsources a significant portion of these activities to third parties. Third-party clinical trial expenses include investigator fees, site costs (patient cost), clinical research organization costs, and costs for central laboratory testing and data management. The accrual for site and patient costs includes inputs such as estimates of patient enrollment, patient cycles

incurred, clinical site activations, and other pass-through costs. These inputs are required to be estimated due to a lag in receiving the actual clinical information from third parties. Payments for these activities are based on the terms of the individual arrangements, which may differ from the pattern of costs incurred. Clinical trial costs are reflected on the consolidated balance sheets as prepaid assets (to the extent payments exceed costs incurred) or accrued clinical trial costs (to the extent costs incurred exceed payments). These third-party agreements are generally cancelable, and related costs are recorded as research and development expenses as incurred. Non-refundable advance clinical payments for goods or services that will be used or rendered for future R&D activities are recorded as a prepaid asset and recognized as expense as the related goods are delivered or the related services are performed. The Company also records accruals for estimated ongoing clinical research and development costs. When evaluating the adequacy of the accrued liabilities, the Company analyzes progress of the studies, including the phase or completion of events, invoices received, and contracted costs. Significant judgments and estimates may be made in determining the accrued balances at the end of any reporting period. Actual results could differ from the estimates made by the Company. The historical clinical accrual estimates made by the Company have not been materially different from the actual costs.

Leases

Leases

The Company determines if an arrangement is a lease at inception. Operating leases include right-of-use (ROU) assets and operating lease liabilities (current and non-current), which are recorded in the Company’s consolidated balance sheets. Single payment capital leases for equipment that are considered finance leases are included in property and equipment in the Company’s consolidated balance sheets. As the single payment obligations have all been made, there is no related liability recorded.

ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. The Company uses the implicit rate when readily determinable. As a number of the Company’s leases do not provide an implicit rate, the Company uses an incremental borrowing rate applicable to the Company based on the information available at the commencement date in determining the present value of lease payments. As the Company has no existing or proposed collateralized borrowing arrangements, to determine a reasonable incremental borrowing rate, the Company considers collateral assumptions, the lease term, the Company’s current credit risk profile, and rates for existing borrowing arrangements for comparable peer companies. The Company accounts for the lease and fixed non-lease components as a single lease component. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for operating lease payments is recognized on a straight-line basis over the lease term.

Other Accrued Liabilities

Other Accrued Liabilities

Other accrued liabilities consisted of the following at December 31, 2021 and 2020 (in thousands):


	December 31,		December 31,
	2021		2020
Accrued contract payments	$	5,558	$	15,576
Accrued clinical trial costs		15,556		11,401
Accrued professional services		839		1,200
Accrued employee benefits		40		39
Accrued public reporting charges		309		319
Other current accrued liabilities		775		785
Total	$	23,077	$	29,320

Accrued contract payments included in the table above primarily relate to external manufacturing, regulatory, and quality-related services. The decrease in the balance as of December 31, 2021 compared to prior year was driven by timing of external manufacturing expenses.

Research and Development Expenses

The Company’s research and development expenses are charged to expense as incurred and relate to (i) research to evaluate new targets and to develop and evaluate new antibodies, linkers, and cytotoxic agents, (ii) preclinical testing of its own and, in certain instances, its collaborators’ product candidates, and the cost of its own clinical trials, (iii) development related to clinical and commercial manufacturing processes, (iv) regulatory activities, and (v) external manufacturing operations. Payments made by the Company in advance for research and development

services not yet provided and/or materials not yet delivered and accepted are recorded as prepaid expenses and are included in the accompanying consolidated balance sheets as prepaid and other current assets.

Income Taxes

Income Taxes

The Company uses the liability method to account for income taxes. Deferred tax assets and liabilities are determined based on differences between the financial reporting and income tax basis of assets and liabilities, as well as net operating loss carry forwards and tax credits and are measured using the enacted tax rates and laws that will be in effect when the differences reverse. A valuation allowance against net deferred tax assets is recorded if, based on the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized.

Property and Equipment

Property and Equipment

Property and equipment are stated at cost. The Company provides for depreciation based upon expected useful lives using the straight-line method over the following estimated useful lives:


Machinery and equipment		5 years
Computer hardware and software		3 years
Furniture and fixtures		5 years
Leasehold improvements		Shorter of remaining lease term or 7 years

Equipment under capital leases is amortized over the lives of the respective leases or the estimated useful lives of the assets, whichever is shorter, and included in depreciation expense.

Maintenance and repairs are charged to expense as incurred. Upon retirement or sale, the cost of disposed assets and the related accumulated depreciation are removed from the accounts and any resulting gain or loss is included in the statement of operations. The Company recorded net gains (losses) of $0.7 million and $(1.7) million related to impairment charges and the sale/disposal of certain furniture and equipment during the years ended December 31, 2020, and 2019, respectively. There were no similar gains (losses) recorded during the year ended December 31, 2021.

Impairment of Long-Lived Assets

Impairment of Long-Lived Assets

The Company continually evaluates whether events or circumstances have occurred that indicate that the estimated remaining useful life of its long-lived assets may warrant revision or that the carrying value of these assets may be impaired if impairment indicators are present. The Company evaluates the realizability of its long-lived assets based on cash flow expectations for the related asset. Any write-downs to fair value are treated as permanent reductions in the carrying amount of the assets. Accordingly, during the year ended December 31, 2019, the Company recorded a $2.5 million asset impairment charge resulting from restructuring activities, the details of which are further discussed in Note I. Based on this evaluation, except for the impairment recognized during 2019, the Company believes that none of the Company’s remaining long-lived assets were impaired.

Common Stock Warrants

Common Stock Warrants

The Company accounts for common stock warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance included in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, whether the warrants meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own common stock and whether the warrant holders could potentially require “net cash settlement” in a circumstance outside of the Company’s control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding.

For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded at their initial fair value on the date of issuance and remeasured each balance sheet date thereafter. Changes in the estimated fair value of the liability-classified warrants are recognized as a non-cash gain or loss in the accompanying consolidated statements of operations and comprehensive loss.

Computation of Net Loss per Common Share

Computation of Net Loss per Common Share

Basic and diluted net loss per share is calculated based upon the weighted average number of shares of common stock outstanding during the period. Shares of the Company’s common stock underlying pre-funded warrants are included in the calculation of basic and diluted earnings per share. During periods of income, participating securities are allocated a proportional share of income determined by dividing total weighted average participating securities by the sum of the total weighted average common shares and participating securities (the “two-class method”). Shares of the Company’s restricted stock participate in any dividends that may be declared by the Company and are therefore considered to be participating securities. Participating securities have the effect of diluting both basic and diluted earnings per share during periods of income. During periods of loss, no loss is allocated to participating securities since they have no contractual obligation to share in the losses of the Company. Diluted loss per share is computed after giving consideration to the dilutive effect of stock options, convertible notes, and restricted stock that are outstanding during the period, except where such non-participating securities would be anti-dilutive.

The Company’s common stock equivalents, as calculated in accordance with the treasury-stock method for options and unvested restricted stock and the if-converted method for the convertible notes, are shown in the following table (in thousands):



	Year Ended December 31,
	2021	2020	2019
Options outstanding to purchase common stock, shares issuable under the employee stock purchase plan, and unvested restricted stock/units at end of period	21,296	18,459	14,815
Common stock equivalents under treasury stock method for options, shares issuable under the employee stock purchase plan, and unvested restricted stock/units	2,546	1,301	1,020
Shares issuable upon conversion of convertible notes at end of period	—	501	501
Common stock equivalents under if-converted method for convertible notes	—	501	501

The Company’s common stock equivalents have not been included in the net loss per share calculation because their effect is anti-dilutive due to the Company’s net loss position.

Comprehensive Loss

Comprehensive Loss

The Company presents comprehensive loss in accordance with ASC 220, Comprehensive Income. Comprehensive loss is comprised of the Company’s net loss for all periods presented.

Segment Information

Segment Information

During all periods presented, the Company continued to operate in one reportable business segment under the management approach of ASC 280, Segment Reporting, which is the business of the discovery and development of ADCs for the treatment of cancer.

The percentages of revenues recognized from significant customers of the Company in the years ended December 31, 2021, 2020, and 2019 are included in the following table:


	Year Ended December 31,
Collaborative Partner:	2021	2020	2019
Roche	67%	53%	64%
Huadong	24%	-%	-%
Jazz	-%	46%	18%
CytomX	-%	-%	13%

There were no other customers of the Company with significant revenues in the periods presented.

Recently Adopted Accounting Pronouncements

Recently Adopted Accounting Pronouncements

In December 2019, the FASB issued Accounting Standards Update (“ASU”) 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, which is intended to simplify the accounting for income taxes. ASU 2019-12 removes certain exceptions to the general principles in ASC 740 and also clarifies and amends existing guidance to improve consistent application. The Company adopted the standard on January 1, 2021, and it did not have a material effect on the Company’s consolidated financial statements.

In November 2018, the FASB issued ASU No. 2018-18, Collaborative Arrangements (Topic 808): Clarifying the Interaction between Topic 808 and Topic 606, which clarifies that certain transactions between participants in a collaborative arrangement should be accounted for under ASC 606 when the counterparty is a customer. In addition, ASU 2018-18 adds unit-of-account guidance to ASC 808 in order to align this guidance with ASC 606 and also precludes an entity from presenting consideration from a transaction in a collaborative arrangement as revenue from contracts with customers if the counterparty is not a customer for that transaction. This guidance is effective for annual reporting periods beginning after December 15, 2019, including interim periods within those annual reporting periods. The Company adopted the standard on January 1, 2020, and it did not have a material effect on the Company’s consolidated financial statements.

In June 2016, the FASB issued ASU No. 2016-13, Measurement of Credit Losses on Financial Instruments, to require financial assets carried at amortized cost to be presented at the net amount expected to be collected based on

historical experience, current conditions, and forecasts. The ASU is effective for interim and annual periods beginning after December 15, 2019. Adoption of the ASU is on a modified retrospective basis. The Company adopted the standard on January 1, 2020, and it did not have a material effect on the Company’s consolidated financial statements.

No other recently issued or effective ASUs had, or are expected to have, a material effect on the Company's results of operations, financial condition, or liquidity.

Income Taxes - Carryforward (Details) $ in Millions	12 Months Ended
Income Taxes - Carryforward (Details) $ in Millions	Dec. 31, 2021 USD ($)
Federal
Carryforward
Operating loss carryforward	$ 471.6
NOL carryforwards, indefinitely	536.6
Credit carryforwards	77.9
State
Carryforward
Operating loss carryforward	839.6
Credit carryforwards	12.1
Foreign Tax
Carryforward
Credit carryforwards	$ 5.4

Agreements

12 Months Ended

Dec. 31, 2021

Agreements

Agreements

C.Agreements

Significant Collaborative Agreements

Roche

In 2000, the Company granted Genentech, now a unit of Roche, an exclusive development and commercialization license to use the Company’s maytansinoid ADC technology with antibodies, such as trastuzumab, or other proteins that target HER2. Under the terms of this agreement, Roche has exclusive worldwide rights to develop and commercialize maytansinoid ADC compounds targeting HER2. Pursuant to this agreement, Roche developed and received marketing approval for its HER2-targeting ADC, KADCYLA, in the U.S., Japan, the European Union, and numerous other countries. Roche is responsible for the manufacturing, product development, and marketing of any products resulting from the agreement. The Company received a $2.0 million non-refundable upfront payment from Roche upon execution of the agreement. The Company is also entitled to receive up to a total of $44.0 million in development and regulatory milestone payments, plus royalties on the commercial sales of KADCYLA or any other resulting products. Through December 31, 2021, the Company had received and recognized $39.0 million in milestone payments related to KADCYLA, including a $5.0 million regulatory milestone payment to the Company for a first extended indication, which is included in license and milestone fees for the year ended December 31, 2019.

The Company receives royalty reports and payments related to sales of KADCYLA from Roche one quarter in arrears. In accordance with the Company’s revenue recognition policy, $46.8 million, $68.5 million, and $47.4 million of non-cash royalties on net sales of KADCYLA were recorded and included in royalty revenue for the years ended December 31, 2021, 2020, and 2019. The Company sold its rights to receive royalty payments on the net sales of KADCYLA through two separate transactions in 2015 and 2019. Following the 2019 transaction, OMERS, the defined benefit pension plan for municipal employees in the Province of Ontario, Canada, is entitled to receive all of these royalties.

Roche, through its Genentech unit, also has licenses for the exclusive right to use the Company’s maytansinoid ADC technology with antibodies to four undisclosed targets, which were granted under the terms of a separate, now expired, 2000 right-to-test agreement with Genentech. For each of these licenses, the Company received a $1.0 million license fee and is entitled to receive up to a total of $38.0 million in development, regulatory, and sales-based milestone payments plus royalties on the sales of any resulting products. The Company has not received any milestone payments from these agreements through December 31, 2021. Roche is responsible for the development, manufacturing, and marketing of any products resulting from these licenses.

Amgen/Oxford BioTherapeutics

Under a now-expired right-to-test agreement established in 2000, the Company granted Amgen an exclusive development and commercialization license for which the Company received a $1.0 million exercise fee and is entitled to receive up to a total of $34.0 million in development, regulatory, and sales-based milestone payments, plus royalties on the commercial sales of any resulting products. Through December 31, 2021, the Company had received and recognized a $1.0 million milestone payment under this agreement. Amgen subsequently sublicensed its rights under the license to Oxford BioTherapeutics Ltd. (OBT). Amgen (or its sublicensee(s)) is responsible for the manufacturing, development, and marketing of any products resulting from the license.

Bayer

In 2008, the Company granted Bayer an exclusive development and commercialization license to the Company’s maytansinoid ADC technology for use with antibodies or other proteins that target mesothelin. The Company received a $4.0 million upfront payment upon execution of the agreement. For each compound developed and marketed by Bayer under this collaboration, the Company is entitled to receive a total of $170.5 million in development, regulatory, and sales-based milestone payments, plus royalties on the commercial sales of any resulting products. Through December 31, 2021, the Company had received and recognized an aggregate of $13.0 million in milestone payments under this agreement. Bayer is responsible for the research, development, manufacturing, and marketing of any products resulting from the license.

Novartis

The Company granted Novartis exclusive development and commercialization licenses to the Company’s maytansinoid and IGN ADC technology for use with antibodies to six specified targets under a now-expired right-to-test agreement established in 2010. The Company received a $45.0 million upfront payment in connection with the execution of the right-to-test agreement in 2010, $8.5 million in extension and amendment fees, and an exercise fee of $1.0 million for each of the six licenses taken. In May 2018, Novartis terminated one of its six licenses.

For each of the remaining development and commercialization licenses, the Company is entitled to receive up to a total of $199.5 million in development, regulatory, and sales-based milestone payments, plus royalties on the commercial sales of any resulting products. In 2015 and 2016, Novartis initiated Phase 1 testing of three of its five product candidates, triggering a $5.0 million development milestone payment to the Company with each event. Novartis later discontinued clinical testing of these three products. In December 2019, a development milestone related to dosing a first patient in a Phase 1 clinical trial for a licensed product became probable of being attained. Accordingly, $4.7 million of the $5.0 million milestone that was allocated to the delivered license was recorded as revenue and is included in license and milestone fees for the year ended December 31, 2019, and $0.3 million that was allocated to future technological improvements was deferred and will be recognized as revenue ratably over the estimated term of the license. In September 2020, Novartis enrolled its first patient in the aforementioned Phase 1 clinical trial and remitted the $5.0 million milestone payment to the Company. Novartis is responsible for the manufacturing, development, and marketing of any products resulting from these licenses.

CytomX

In 2016, the Company granted CytomX an exclusive development and commercialization license to the Company’s maytansinoid ADC technology for use with Probodies™ that target CD166 under a now expired reciprocal right-to-test agreement. The Company neither received nor made an upfront cash payment in connection with the execution of the right-to-test agreement or the license agreement. With respect to the development and commercialization license granted to CytomX, the Company is entitled to receive up to a total of $160.0 million in development, regulatory, and sales-based milestone payments plus royalties on the commercial sales of any resulting product. Through December 31, 2021, the Company had received and recognized an aggregate of $4.0 million in milestone payments under this agreement, of which $3.0 million is included as license and milestone fee revenue for the year ended December 31, 2019.

In December 2019, the Company granted CytomX an exclusive development and commercialization license to maytansinoid and IGN ADC technology for use with Probodies™ that target EpCAM. Pursuant to the license agreement, in January 2020, the Company received a $7.5 million upfront payment, of which $7.3 million was recorded as license and milestone fee revenue upon delivery of the license to CytomX in December 2019 and $0.2 million was deferred until delivery of certain materials as these performance obligations were determined to be distinct. The Company is also entitled to receive up to a total of $355.0 million in development, regulatory, and sales-based milestone payments plus royalties on the commercial sales of any resulting product. The Company had not received any milestone payments under this agreement through December 31, 2021.

CytomX is responsible for the manufacturing, product development, and marketing of any products resulting from these licenses.

Fusion

In December 2016, the Company entered into an exclusive license agreement to a specified target with Fusion Pharmaceuticals Inc. The Company is entitled to receive up to a total of $50.0 million in development, regulatory, and sales-based milestone payments plus royalties on the commercial sales of any resulting products. Through December 31, 2021, the Company had received and recognized a $0.5 million milestone payment under this agreement. Fusion is responsible for the manufacturing, product development, and marketing of any products resulting from the license.

Debiopharm

In May 2017, Debiopharm International SA (Debiopharm) acquired the Company’s IMGN529 program, a clinical-stage anti-CD37 ADC for the treatment of patients with B-cell malignancies, such as non-Hodgkin lymphomas (NHL). Under the terms of the Exclusive License and Asset Purchase agreement, the Company received a $25.0 million upfront payment for specified assets related to IMGN529 and an exclusive license to additional intellectual property necessary or useful for Debiopharm to develop and commercialize IMGN529 (now known as Debio 1562). The Company also received a $5.0 million milestone payment upon transfer of ImmunoGen technologies related to the

program (technology transfer) and was entitled to receive a $25.0 million milestone payment upon IMGN529 entering a Phase 3 clinical trial.

In October 2021, the Company and Debiopharm amended their agreement, pursuant to which the Company is entitled to receive a percentage of all payments generated from future sublicenses of Debio 1562, including upfront fees, milestones, and royalties, up to an aggregate of $30.0 million and in lieu of the potential $25.0 million development milestone payment under the original agreement.

Viridian

In October 2020, the Company entered into a license agreement with Viridian Therapeutics, Inc. pursuant to which the Company granted Viridian the exclusive right to develop and commercialize an insulin-like growth factor-1 receptor (IGF-1R) antibody for all non-oncology indications that do not use radiopharmaceuticals in exchange for an upfront payment, with the potential to receive up to a total of $143.0 million in development, regulatory, and sales-based milestone payments plus royalties on the commercial sales of any resulting product. In 2021, the Company received a $2.5 million payment related to a development milestone achieved in October 2021 and a second $3.0 million development milestone became probable of being achieved, which resulted in $5.5 million being allocated to the previously delivered license and recognized as revenue as a component of license and milestone fees for the year ended December 31, 2021. Viridian is responsible for the manufacturing, development, and marketing of any products resulting from the license agreement.

Huadong

In October 2020, the Company entered into a collaboration and license agreement with Hangzhou Zhongmei Huadong Pharmaceutical Co., Ltd. (Huadong), a subsidiary of Huadong Medicine Co., Ltd. The collaboration and license agreement grants Huadong an exclusive, royalty-bearing, and sublicensable right to develop and commercialize mirvetuximab (the Licensed Product) in the People’s Republic of China, Hong Kong, Macau, and Taiwan (collectively, Greater China). The Company retains exclusive rights to the Licensed Product outside of Greater China. Under the terms of the collaboration and license agreement, the Company received a non-refundable upfront payment of $40.0 million with the potential for approximately $265.0 million in development, regulatory, and sales-based milestone payments. In addition, the Company is entitled to receive tiered percentage royalties ranging from low double digits to high teens as a percentage of commercial sales of the Licensed Product, if approved, by Huadong in Greater China, subject to adjustment in specified circumstances.

The Company evaluated the agreement and determined it was within the scope of ASC 606. The Company determined the promised goods and services included the license to intellectual property and know-how and the clinical supply of the Licensed Product to Huadong for a specified period. The Company concluded that the license to intellectual property and know-how is not distinct from the clinical supply of the Licensed Product because the clinical supply is essential to the use of the license and an alternative source of clinical supply is not readily available in the marketplace. Accordingly, these two promised goods and services are considered a single combined performance obligation. The Company determined there were no options in the agreement that represented material rights.

The transaction price was determined to consist of the upfront payment of $40.0 million and estimated payments to be received for clinical supply of the Licensed Product. At contract inception, future development and regulatory milestones were fully constrained. Any consideration related to sales-based milestones (including royalties) will be recognized when the related sales occur as these amounts have been determined to relate predominantly to the license granted to Huadong. The Company re-evaluates the transaction price, including its estimated variable consideration included in the transaction price and all constrained amounts, at each reporting period and as uncertain events are resolved or other changes in circumstances occur.

The Company determined that revenue related to the agreement would be recognized as the clinical supply of the Licensed Product is delivered to Huadong, estimated to be completed over approximately two years. The Company has estimated the total clinical supply to be delivered during this time and will reassess the percentage of clinical supply that has been delivered on an ongoing basis. If a change in estimate is determined to be necessary, the Company will adjust revenue using a cumulative catch-up method.

In 2021, the first shipment of clinical supply was delivered to Huadong and, based on the total estimated clinical supply to be delivered, $14.6 million was recorded as license and milestone fee revenue. Additionally, in December 2021, the Company received a $5.0 million payment upon achievement of a development milestone, of which $1.8 million was recognized as license and milestone fee revenue in 2021 and $3.2 million was deferred and will be recorded as revenue as clinical supply is delivered in 2022. As of December 31, 2021, the total deferred revenue

balances related to the Huadong arrangement was $28.6 million and is expected to be recognized during 2022 as clinical supply is delivered.

Terminated Agreements

Jazz Pharmaceuticals

In August 2017, the Company entered into a Collaboration and Option Agreement with Jazz Pharmaceuticals Ireland Limited (Jazz), a subsidiary of Jazz Pharmaceuticals plc, granting Jazz exclusive, worldwide rights to opt into development and commercialization of two early-stage, hematology-related ADC programs, as well as an additional program to be designated during the term of the agreement. Pursuant to the agreement, Jazz made an upfront payment of $75.0 million to the Company. Additionally, Jazz had also agreed to pay the Company up to $100.0 million in development funding over seven years to support the three ADC programs.

Due to the involvement the Company and Jazz both had in the development and commercialization of the products, as well as both parties being part of the cost share agreement and exposed to significant risks and rewards dependent on the commercial success of the products, the arrangement was determined to be a collaborative arrangement within the scope of ASC 808. Accordingly, the Company separated the research and development activities and the related cost sharing arrangement with Jazz. Payments for such activities were recorded as research and development expense and reimbursements received from Jazz were recognized as an offset to research and development expense in the accompanying statement of operations during the development period. Included in research and development expense for the years ended December 31, 2021, 2020, and 2019, are $6.7 million, $6.7 million, and $12.5 million of credits related to reimbursements from Jazz, respectively.

In October 2019 and December 2020, Jazz exercised certain opt-out rights under the agreement, thereby relinquishing its development and commercialization options and restoring all rights to the ADC programs to the Company. The non-refundable, upfront arrangement consideration of $75.0 million was allocated to the three license options. The amount allocated to the rights to future technological improvements under the relative selling price method was deemed immaterial and, therefore, not segregated from the license options. In conjunction with the opt-outs, the Company recognized $60.5 million and $14.5 million of the deferred upfront fee as license and milestone fee revenue in the years ended December 31, 2020 and 2019, respectively.

Takeda

In March 2015, the Company entered into a three-year right-to-test agreement with Takeda Pharmaceutical Company Limited (Takeda) through its wholly-owned subsidiary, Millennium Pharmaceuticals, Inc., pursuant to which the Company received a $20.0 million upfront payment. A first license was granted to Takeda in 2015, and in 2018, the right-to-test agreement expired without Takeda exercising its option to a second license. In 2020, Takeda terminated its exclusive development and commercialization license. As a result, the Company recorded the remaining $0.9 million balance of the upfront payment that had been allocated to future performance obligations under the license as revenue, which is included in license and milestone fees for the year ended December 31, 2020.

Biotest

In 2006, the Company granted Biotest an exclusive development and commercialization license to the Company’s maytansinoid ADC technology for use with antibodies that target CD138, pursuant to which the Company received a $1.0 million upfront payment. In 2020, Biotest terminated the license.

Leases (Tables)

12 Months Ended

Dec. 31, 2021

Leases

Schedule of maturities of operating lease liabilities

The maturities of operating lease liabilities discussed above are as follows (in thousands):


2022	$	5,363
2023		5,503
2024		5,522
2025		5,543
2026		1,429
Thereafter		13
Total lease payments		23,373
Less imputed interest		(4,592)
Total lease liabilities	$	18,781

Agreements - Takeda (Details) - USD ($) $ in Thousands	1 Months Ended	12 Months Ended
Agreements - Takeda (Details) - USD ($) $ in Thousands	Mar. 31, 2015	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Collaborative Agreements disclosures
Revenue from contract with customer		$ 69,856	$ 132,299	$ 82,271
Takeda \| Right-to-test agreement
Collaborative Agreements disclosures
Term of agreement	3 years
License and milestone fees
Collaborative Agreements disclosures
Revenue from contract with customer		22,650	63,742	34,788
License and milestone fees \| Takeda
Collaborative Agreements disclosures
Revenue from contract with customer		900
Upfront payment \| Takeda
Collaborative Agreements disclosures
Revenue from contract with customer	$ 20,000
Research and development support
Collaborative Agreements disclosures
Revenue from contract with customer		$ 398	$ 28	$ 68

- Definition

+ References

+ Details

Summary of Significant Accounting Policies - Revenues Recognized as a Result of Changes in Contract Asset and Liability Balances (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Revenue recognized in the period from:
Amounts included in contract liabilities at the beginning of the period	$ 22,765	$ 61,872	$ 14,817
Performance obligations satisfied in previous periods	$ 5,500		$ 12,672

Agreements - Debiopharm (Details) - USD ($) $ in Thousands		1 Months Ended	12 Months Ended
Agreements - Debiopharm (Details) - USD ($) $ in Thousands	Oct. 31, 2021	May 31, 2017	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Collaborative Agreements disclosures
Revenue from contract with customer			$ 69,856	$ 132,299	$ 82,271
Debiopharm \| Transfer of ImmunoGen technologies
Collaborative Agreements disclosures
Potential milestone payment		$ 5,000
Debiopharm \| Upfront payment \| IMGN529 program
Collaborative Agreements disclosures
Revenue from contract with customer		25,000
Debiopharm \| Upfront Fees, Milestones, and Royalties \| IMGN529 program \| Maximum
Collaborative Agreements disclosures
Revenue from contract with customer	$ 25,000
Potential milestone payment	$ 30,000
Debiopharm \| Milestone Payment \| IMGN529 program
Collaborative Agreements disclosures
Revenue from contract with customer		$ 25,000

Capital Stock

12 Months Ended

Dec. 31, 2021

Capital Stock

Capital Stock

H.Capital Stock

Common Stock Reserved

At December 31, 2021, the Company had reserved 33.6 million shares of authorized common stock for the future issuance of shares under the 2018, ESPP, and Inducement Plans. See “Stock-Based Compensation” in Note B for a description of the 2018, ESPP, and Inducement Plans. Additionally, the Company has reserved 32.8 million shares of authorized common stock for future issuance pursuant to pre-funded warrant agreements, the details of which are discussed below.

Pre-Funded Warrants

In August 2021, the Company entered into a Securities Purchase Agreement (SPA) with RA Capital Healthcare Fund, L.P. (RA Capital), pursuant to which the Company agreed to sell to RA Capital a pre-funded warrant to purchase up to 5,434,782 shares of common stock for $5.51 per share of common stock underlying the pre-funded warrant. The per share exercise price of the pre-funded warrant is $0.01. The private placement resulted in aggregate gross proceeds of $29.9 million, before $0.2 million of transaction costs.

In connection with a public offering in December 2021, the Company issued pre-funded warrants to purchase 16,000,000 and 11,363,636 shares of common stock to RA Capital and Redmile Group, LLC, respectively, for $6.59 per share of common stock underlying the pre-funded warrants, which, together with the per share exercise price of $0.01, is equal to $6.60, the public offering price of the shares of common stock in the offering. RA Capital and Redmile Group, LLC are each considered related parties pursuant to ASC 850, Related Party Disclosures.

The pre-funded warrants’ fundamental transaction provision does not provide the warrant holders with the option to settle any unexercised warrants for cash in the event of any fundamental transactions; rather, in all fundamental transaction scenarios, the warrant holder will only be entitled to receive from the Company or any successor entity the same type or form of consideration (and in the same proportion) that is being offered and paid to the shareholders of the Company in connection with the fundamental transaction, whether that consideration be in the form of cash, stock or any combination thereof. The pre-funded warrants also include a separate provision whereby the exercisability of the warrants may be limited if, upon exercise, the warrant holder or any of its affiliates would beneficially own more than 9.99% of the Company’s common stock. This threshold is subject to the holder’s rights under the pre-funded warrants to increase or decrease such percentage to any other percentage not in excess of 19.99% upon at least 61 days’ prior notice from the holder to the Company.

The Company has assessed the pre-funded warrants for appropriate equity or liability classification pursuant to the Company’s accounting policy described in Note B, “Summary of Significant Accounting Policies.” During this assessment, the Company determined the pre-funded warrants are freestanding instruments that do not meet the definition of a liability pursuant to ASC 480 and do not meet the definition of a derivative pursuant to ASC 815. The pre-funded warrants are indexed to the Company’s common stock and meet all other conditions for equity classification under ASC 480 and ASC 815. Based on the results of this assessment, the Company concluded that the pre-funded warrants are freestanding equity-linked financial instruments that meet the criteria for equity classification under ASC 480 and ASC 815. Accordingly, the pre-funded warrants are classified as equity and accounted for as a component of additional paid-in capital at the time of issuance. The Company also determined that the pre-funded warrants should be included in the determination of basic and diluted earnings per share in accordance with ASC 260, Earnings per Share.

Stock Options

As of December 31, 2021, the 2018 Plan and the Inducement Plan were the only employee share-based compensation plans of the Company under which grants can be made. During the year ended December 31, 2021, holders of options issued under the option plans exercised their rights to acquire an aggregate of 872,000 shares of

common stock at prices ranging from $1.84 to $7.07 per share. The total proceeds to the Company from these option exercises were $3.1 million. Additionally, during 2021 and pursuant to the Company’s ESPP, approximately 126,000 shares of common stock were issued to participating employees generating $0.7 million of proceeds to the Company.

2004 Non-Employee Director Compensation and Deferred Share Unit Plan

Under the 2004 Non-Employee Director Compensation and Deferred Share Unit Plan, or the 2004 Director Plan, as amended, between 2004 and 2009 non-employee directors were paid their annual retainers in the form of deferred stock units, based on the fair market value of the Company’s common stock on the last date of the Company’s fiscal year prior to the year for which services were rendered, and in cash, with the option, at their discretion, to have all or a portion of the cash portion paid in additional deferred stock units. All deferred stock units awarded under the 2004 Director Plan have vested and are redeemed on the date a director ceases to be a member of the Board, at which time such director’s deferred stock units will be settled in shares of common stock of the Company issued under the 2006 Plan at a rate of one share for each vested unit.

Compensation Policy for Non-Employee Directors

In September 2009, the Board adopted a new Compensation Policy for Non-Employee Directors, which superseded the 2004 Plan and made certain changes to the compensation of its non-employee directors. The Compensation Policy for Non-Employee Directors, as amended as of December 2021, consists of three elements: cash compensation; deferred stock units; and stock options.

Cash Compensation

Each non-employee director receives annual meeting fees which are paid in quarterly installments in, at each director’s election, either cash or deferred stock units.

Deferred Stock Units

Pursuant to the Compensation Policy for Non-Employee Directors, as amended, non-employee directors receive deferred stock units upon initial election to the Board and annually thereafter. Vested deferred stock units are redeemed on the date a director ceases to be a member of the Board, at which time such director’s deferred stock units will generally be settled in shares of the Company’s common stock issued under our 2018 Plan (or its predecessor plans, depending on the grant date of the deferred stock units) at a rate of one share for each vested deferred stock unit then held. Any deferred stock units that remain unvested at that time will be forfeited.

Pursuant to the Compensation Policy for Non-Employee Directors, as amended, the Company recorded:

●

$0.7 million in compensation expense during the year ended December 31, 2021 related to the grant of 166,000 deferred share units and 52,000 deferred share units previously granted;

●

$0.3 million in compensation expense during the year ended December 31, 2020 related to the grant of 127,000 deferred share units and 15,000 deferred share units previously granted; and

●

$0.3 million in compensation expense during the year ended December 31, 2019 related to the grant of 63,000 deferred share units and 18,000 deferred share units previously granted.

Stock Options

Pursuant to the Compensation Policy for Non-Employee Directors, as amended, non-employee directors also receive stock option awards upon initial election to the Board and annually thereafter. The directors received a total of 352,000, 300,000, and 108,000 options in the years ended December 31, 2021, 2020, and 2019, and the related stock compensation expense is included in the amounts discussed in the “Stock-Based Compensation” section of footnote B above.

Commitments and Contingencies

12 Months Ended

Dec. 31, 2021

Commitments and Contingencies

Commitments and Contingencies

K.Commitments and Contingencies

Manufacturing Commitments

As of December 31, 2021, the Company has noncancelable obligations under several agreements related to in-process and future manufacturing of antibody and cytotoxic agents required for supply of the Company’s product candidates totaling $7.1 million, which will be paid in 2022. Additionally, pursuant to commercial agreements for future production of antibody, the Company’s noncancelable commitments total $41.6 million at December 31, 2021.

License Commitment

In October 2021, as a result of a dispute regarding terms of a 2012 license agreement with a contract manufacturing vendor, the Company and vendor amended their agreement to replace certain annual fees and potential royalties payable by the Company on future sales of mirvetuximab with capped development and sales-based milestone payments totaling $18.0 million, of which $3.0 million was recorded as research and development expense during the year ended December 31, 2021.

Litigation

The Company is not party to any material litigation.

Summary of Significant Accounting Policies - Revenue Recognition (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2021 USD ($) item	Dec. 31, 2010 item
Bayer HealthCare
Summary of Significant Accounting Policies
Number of single-target licenses	1
CytomX
Summary of Significant Accounting Policies
Number of single-target licenses	2
Debiopharm
Summary of Significant Accounting Policies
Number of single-compound licenses	1
Future milestones or royalties to be received \| $	$ 0
Fusion Pharmaceuticals
Summary of Significant Accounting Policies
Number of single-target licenses	1
Novartis
Summary of Significant Accounting Policies
Number of single-target licenses	5	6
Oxford BioTherapeutics Ltd Member
Summary of Significant Accounting Policies
Number of single-target licenses	1
Roche
Summary of Significant Accounting Policies
Number of single-target licenses	5
Hangzhou Zhongmei Huadong Pharmaceutical Co., Ltd
Summary of Significant Accounting Policies
Number of single-compound licenses	1
Viridian
Summary of Significant Accounting Policies
Number of single-target licenses	1

Liability Related to Sale of Future Royalties

12 Months Ended

Dec. 31, 2021

F.Liability Related to Sale of Future Royalties

In 2015, Immunity Royalty Holdings, L.P. (IRH) purchased the right to receive 100% of the royalty payments on commercial sales of KADCYLA arising under the Company’s development and commercialization license with Genentech, until IRH had received aggregate royalties equal to $235 million or $260 million, depending on when the aggregate royalties received by IRH reached a specified milestone. Once the applicable threshold was met, the Company would thereafter have received 85% and IRH would have received 15% of the KADCYLA royalties for the remaining royalty term. At consummation of the transaction, the Company received cash proceeds of $200 million. As part of this sale, the Company incurred $5.9 million of transaction costs, which are presented net of the liability in the accompanying consolidated balance sheet and are being amortized to interest expense over the estimated life of the royalty purchase agreement. Although the Company sold its rights to receive royalties from the sales of KADCYLA, as a result of its ongoing involvement in the cash flows related to these royalties, the Company continues to account for these royalties as revenue and recorded the $200 million in proceeds from this transaction as a liability related to sale of future royalties (Royalty Obligation) that is being amortized using the interest method over the estimated life of the royalty purchase agreement.

In January 2019, the Company sold its residual rights to receive royalty payments on commercial sales of KADCYLA to OMERS, the defined benefit pension plan for municipal employees in the Province of Ontario, Canada, for a net payment of $65.2 million (amount is net of $1.5 million in broker fees). Simultaneously, OMERS purchased IRH’s right to the royalties the Company previously sold as described above, therefore obtaining the rights to 100% of the royalties received from that date on. Because the Company will not be involved with the cash flows related to the residual royalties, the $65.2 million of net proceeds received from the sale of its residual rights to receive royalty payments was recorded as deferred revenue and is being amortized as the royalty revenue related to the residual rights is earned using the units of revenue approach. During the second quarter of 2021, the aggregate royalty threshold was met

and, in accordance with the Company’s revenue recognition policy, $7.7 million of revenue related to the residual rights was recorded and is included in non-cash royalty revenue for the year ended December 31, 2021. Additionally, the purchase of IRH’s interest by OMERS did not result in an extinguishment or modification of the original instrument and, accordingly, the Company will continue to account for the remaining obligation as a liability as outlined above.

The following table shows the activity within the liability account during the year ended December 31, 2021 and the period from inception (in thousands):


			Period from
	Year Ended		inception to
	December 31, 2021		December 31, 2021
Liability related to sale of future royalties, net — beginning balance	$	85,439	$	—
Proceeds from sale of future royalties, net		—		194,135
KADCYLA royalty payments received and paid		(57,490)		(263,857)
Non-cash interest expense recognized		13,095		110,766
Liability related to sale of future royalties, net — ending balance	$	41,044	$	41,044

The Company receives royalty reports and royalty payments related to sales of KADCYLA from Roche one quarter in arrears. As royalties are remitted to OMERS, the balance of the Royalty Obligation will be effectively repaid over the life of the agreement. In order to determine the amortization of the Royalty Obligation, the Company is required to estimate the total amount of future royalty payments to be received and remitted as noted above over the life of the agreement. The sum of these amounts less the $200 million proceeds the Company received from IRH will be recorded as interest expense over the life of the Royalty Obligation. Since inception, the Company’s estimate of this total interest expense has resulted in an imputed annual interest rate of 10.5% and a current imputed interest rate of 19.5% as of December 31, 2021. The Company periodically assesses the estimated royalty payments to IRH/OMERS and to the extent such payments are greater or less than its initial estimates, or the timing of such payments is materially different than its original estimates, the Company will prospectively adjust the amortization of the Royalty Obligation. There are a number of factors that could materially affect the amount and timing of royalty payments from Genentech, most of which are not within the Company’s control. Such factors include, but are not limited to, changing standards of care, the introduction of competing products, manufacturing or other delays, biosimilar competition, patent protection, adverse events that result in governmental health authority imposed restrictions on the use of the drug products, significant changes in foreign exchange rates as the royalties are paid in U.S. dollars (USD) while significant portions of the underlying sales of KADCYLA are made in currencies other than USD, and other events or circumstances that could result in reduced royalty payments from KADCYLA, all of which would result in a reduction of non-cash royalty revenues and non-cash interest expense over the life of the Royalty Obligation. Conversely, if sales of KADCYLA are more than expected, the non-cash royalty revenues and the non-cash interest expense recorded by the Company would be greater over the term of the Royalty Obligation.

Income Taxes

12 Months Ended

Dec. 31, 2021

Income Taxes

Income Taxes

G.Income Taxes


	Years Ended December 31,
	2021		2020		2019
Loss before income tax expense	$	(139,303)	$	(44,372)	$	(104,133)
Expected tax benefit at 21%	$	(29,254)	$	(9,318)	$	(21,868)
Permanent differences		606		157		320
Incentive stock options		420		201		569
State tax benefit net of federal benefit		(7,376)		(2,250)		(6,726)
Change in valuation allowance, net		46,987		15,175		27,812
Federal research credit		(575)		(228)		(1,652)
Federal orphan drug credit		(7,429)		(6,218)		(4,426)
Expired loss and credit carryforwards		345		419		500
Withholding tax credit		(4,789)		—		—
Stock option expirations		1,065		2,062		5,471
Benefit for income taxes	$	—	$	—	$	—

At December 31, 2021, the Company had net operating loss, or NOL, carryforwards of $471.6 million available to reduce federal taxable income, if any, that begin to expire in 2028 through 2037 and an additional $536.6 million of

federal NOL carryforwards that can be carried forward indefinitely. The Company has $839.6 million of NOL carryforwards available to reduce state taxable income, if any, that expire in 2033 through 2041. The Company also has federal and state credit carryforwards of $77.9 million and $12.1 million, respectively, available to offset federal and state income taxes, which expire beginning in 2023 and foreign tax credits of $5.4 million that expire in 2030 and 2031. Due to the degree of uncertainty related to the ultimate use of the loss carryforwards and tax credits, the Company has established a valuation allowance to fully reserve these tax benefits.

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company’s deferred tax assets and liabilities as of December 31, 2021 and 2020 are as follows (in thousands):


	December 31,
	2021		2020
Deferred tax assets:
Net operating loss carryforwards	$	264,773	$	220,286
Research and development tax credit carryforwards		92,832		80,694
Property and other intangible assets		1,150		871
Deferred revenue		25,153		30,082
Stock-based compensation		12,286		9,940
Operating lease liability		5,170		6,033
Other liabilities		1,737		1,514
Royalty sale		10,247		17,455
Total deferred tax assets	$	413,348	$	366,875

Deferred tax liabilities:
Stock-based compensation		(91)		(58)
Operating lease right of use asset		(3,386)		(3,844)
Royalty sale transaction costs		(158)		(247)
Total deferred tax liabilities	$	(3,635)	$	(4,149)
Valuation allowance		(409,713)		(362,726)
Net deferred tax assets/(liabilities)	$	—	$	—

The Company has evaluated the positive and negative evidence bearing upon the realizability of its deferred tax assets. The Company has determined that it is not more-likely-than-not that the tax benefits related to the federal and state deferred tax assets will be realized for financial reporting purposes. Accordingly, the deferred tax assets have been fully reserved at December 31, 2021 and 2020. The valuation allowance increased by $47.0 million during the year ended December 31, 2021 due primarily to additional net loss incurred during the year.

Utilization of the NOL and credit carryforwards may be subject to a substantial annual limitation due to ownership change limitations that have occurred previously or that could occur in the future as provided by Sections 382 and 383 of the Internal Revenue Code of 1986, as well as similar state and foreign provisions. These ownership changes may limit the amount of NOL and credit carry forwards that can be utilized annually to offset future taxable income and tax, respectively. In general, an ownership change, as defined by Section 382, results from transactions increasing the ownership of certain shareholders or public groups in the stock of a corporation by more than 50 percentage points over a three-year period. Since the Company’s formation, it has raised capital through the issuance of capital stock on several occasions (both pre and post initial public offering) which, combined with the purchasing shareholders’ subsequent disposition of those shares, may have resulted in a change of control, as defined by Section 382, or could result in a change of control in the future upon subsequent disposition. During fiscal year 2015, the Company completed a study to assess whether a change of control has occurred or whether there have been multiple changes of control since its formation and determined no ownership change occurred under Section 382. This study was updated through December 31, 2021 resulting in the same conclusion. Additionally, the Company has not completed a detailed Research and Development Credit Study (including the Orphan Drug Credit); accordingly, a portion of the tax credit carryforward may not be available to offset future income.

The Company accounts for uncertain tax positions under the recognition and measurement criteria of ASC 740-10. For those tax positions for which it is more likely than not that a tax benefit will be sustained, the Company records the largest amount of tax benefit with a greater than 50% likelihood of being realized upon settlement with a taxing authority that has full knowledge of all relevant information. If the Company does not believe that it is not more likely than not that a tax benefit will be sustained, no tax benefit is recognized. As of December 31, 2021 and 2020, no

uncertain tax positions have been recorded. Interest and penalties related to the settlement of uncertain tax positions, if any, will be reflected in income tax expense. The Company did not recognize any interest and penalties associated with unrecognized tax benefits in the accompanying consolidated financial statements. The Company does not expect any material changes to the unrecognized benefits within 12 months of the reporting date. Due to existence of the valuation allowance, future changes in the Company’s unrecognized tax benefits will not impact its effective tax rate.

The statute of limitations for assessment by the Internal Revenue Service, or IRS, and state tax authorities is open for tax years ending after December 31, 2018, although carryforward attributes that were generated prior to 2018 may still be adjusted upon examination by the IRS or state tax authorities if they either have been or will be used in a future period.

- Definition

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.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 21
-URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32857-109319

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SAB Topic 11.C)
-URI http://asc.fasb.org/extlink&oid=122134291&loc=d3e330215-122817

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 17
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32809-109319

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SAB TOPIC 6.I.5.Q1)
-URI http://asc.fasb.org/extlink&oid=122134291&loc=d3e330036-122817

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 14
-URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32705-109319

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 270
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-URI http://asc.fasb.org/topic&trid=2144680

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 30
-Section 50
-Paragraph 2
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(h)(2))
-URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

+ Details

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
ASSETS
Cash and cash equivalents	$ 478,750	$ 293,856
Accounts receivable	4,467	35
Unbilled receivable	2,345	11
Contract assets	3,000
Non-cash royalty receivable	4,115	22,451
Prepaid and other current assets	7,322	7,901
Total current assets	499,999	324,254
Property and equipment, net of accumulated depreciation	4,663	5,760
Operating lease right-of-use assets	12,392	14,072
Other assets	8,711	10,986
Total assets	525,765	355,072
LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable	18,434	9,538
Accrued compensation	5,469	4,620
Other accrued liabilities	23,077	29,320
Convertible 4.5% senior notes, net of deferred financing costs of $0 and $7, respectively		2,093
Current portion of liability related to the sale of future royalties, net of deferred financing costs of $198 and $319, respectively	6,077	44,357
Current portion of operating lease liability	3,537	3,146
Current portion of deferred revenue	44,351	29,249
Total current liabilities	100,945	122,323
Deferred revenue, net of current portion	47,717	80,860
Operating lease liability, net of current portion	15,244	18,651
Liability related to the sale of future royalties, net of current portion and deferred financing costs of $381 and $584, respectively	34,967	41,082
Other long-term liabilities	1,306	2,586
Total liabilities	200,179	265,502
Commitments and contingencies (Note I)
Shareholders' deficit:
Preferred stock, $.01 par value; authorized 5,000 shares; no shares issued and outstanding as of each of December 31, 2021 and December 31, 2020
Common stock, $.01 par value; authorized 300,000 shares; 220,361 and 194,998 shares issued and outstanding as of December 31, 2021 and December 31, 2020, respectively	2,204	1,950
Additional paid-in capital	1,794,525	1,419,460
Accumulated deficit	(1,471,143)	(1,331,840)
Total shareholders' equity	325,586	89,570
Total liabilities and shareholders' equity	$ 525,765	$ 355,072

Agreements - Jazz Pharmaceuticals (Details) $ in Thousands		12 Months Ended
Agreements - Jazz Pharmaceuticals (Details) $ in Thousands	Aug. 31, 2017 Option	Dec. 31, 2022 USD ($) item	Dec. 31, 2021 USD ($)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 USD ($)
Collaborative Agreements disclosures
Revenue from contract with customer			$ 69,856	$ 132,299	$ 82,271
Deferred revenue			92,068	110,109	127,432
Revenue recognized, previously deferred			22,765	61,872	14,817
Jazz
Collaborative Agreements disclosures
Number of early stage ADC programs \| item		2
Potential milestone payment		$ 100,000
Term of agreement		7 years
Offset to research and development expense			6,700	6,700	12,500
Revenue recognized, previously deferred				60,500	14,500
Upfront payment \| Jazz
Collaborative Agreements disclosures
Revenue from contract with customer		$ 75,000
Upfront Arrangement Consideration, Number of License Options allocated To \| Option	3
License and milestone fees
Collaborative Agreements disclosures
Revenue from contract with customer			22,650	63,742	34,788
Research and development support
Collaborative Agreements disclosures
Revenue from contract with customer			$ 398	$ 28	$ 68

Agreements - Biotest (Details) - USD ($) $ in Thousands	12 Months Ended
Agreements - Biotest (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2006
Collaborative Agreements disclosures
Revenue from contract with customer	$ 69,856	$ 132,299	$ 82,271
License and milestone fees
Collaborative Agreements disclosures
Revenue from contract with customer	22,650	63,742	34,788
Upfront payment \| Biotest
Collaborative Agreements disclosures
Revenue from contract with customer				$ 1,000
Research and development support
Collaborative Agreements disclosures
Revenue from contract with customer	$ 398	$ 28	$ 68

- Definition

+ References

+ Details

Income Taxes - Deferred Tax Assets Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Deferred tax assets:
Net operating loss carryforwards	$ 264,773	$ 220,286
Research and development tax credit carryforwards	92,832	80,694
Property and other intangible assets	1,150	871
Deferred revenue	25,153	30,082
Stock-based compensation	12,286	9,940
Operating lease liability	5,170	6,033
Other liabilities	1,737	1,514
Royalty sale	10,247	17,455
Total deferred tax assets	413,348	366,875
Deferred tax liabilities:
Stock-based compensation	(91)	(58)
Operating lease right of use asset	(3,386)	(3,844)
Royalty sale transaction costs	(158)	(247)
Total deferred tax liabilities	3,635	4,149
Valuation allowance	$ (409,713)	$ (362,726)

Leases - Operating Leases (Details) $ in Thousands		9 Months Ended	12 Months Ended
Leases - Operating Leases (Details) $ in Thousands	Jan. 01, 2019 USD ($)	Sep. 30, 2019 USD ($)	Dec. 31, 2021 USD ($) ft² item lease	Dec. 31, 2020 USD ($)	Dec. 31, 2020 USD ($) ft²	Dec. 31, 2020 USD ($) lease	Dec. 31, 2020 USD ($) agreement	Dec. 31, 2019 USD ($)
Lessee, Lease, Description [Line Items]
Number of real estate leases \| lease			1
Area of space leased \| ft²			120,000
Number of additional terms for which lease agreement can be extended \| item			2
Operating lease term extension period			5 years
Number of executed sub-lease spaces						4	4
Area of executed sublease space \| ft²					65,000
Right-of-use assets			$ 12,392	$ 14,072	$ 14,072	$ 14,072	$ 14,072
Lease liabilities			$ 18,781
Unamortized lease incentive and straight-line lease liability balances	$ 9,700
Weighted-average discount rate			11.00%
100 basis point change effect on ROU asset			$ 1,000
Lease expense for operating lease payments			4,000	4,000				$ 4,300
Operating lease right-of-use asset impairment								$ 600
Leasehold impairment charge		$ 600
Cash paid against operating lease liabilities			$ 5,300	5,500
Weighted average remaining term of the operating leases			4 years 3 months
Sublease income			$ 4,900	$ 2,800
Minimum rental payments over the remaining term of the sublease			$ 13,300
Lessee, Operating Lease, Existence of Option to Extend [true false]			true
New Lease Standard Adjustment \| Restatement Adjustment
Lessee, Lease, Description [Line Items]
Right-of-use assets	17,600
Lease liabilities	$ 27,300

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
CONSOLIDATED BALANCE SHEETS
Current portion of deferred financing costs	$ 0	$ 7
Interest rate (as a percent)	4.50%	4.50%
Sale of future royalties, current portion and deferred financing costs	$ 198	$ 319
Sale of future royalties, noncurrent portion and deferred financing costs	$ 381	$ 584
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, authorized shares	5,000	5,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, authorized shares	300,000	300,000
Common stock, issued shares	220,361	194,998
Common stock, outstanding shares	220,361	194,998

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Revenues:
Total revenues	$ 69,856	$ 132,299	$ 82,271
Operating expenses:
Research and development	151,117	114,592	114,522
General and administrative	43,812	38,600	38,489
Restructuring charge		1,487	21,433
Total operating expenses	194,929	154,679	174,444
Loss from operations	(125,073)	(22,380)	(92,173)
Investment income, net	51	729	4,424
Non-cash interest expense on liability related to the sale of future royalties and convertible senior notes	(13,103)	(23,107)	(16,879)
Interest expense on convertible senior notes	(47)	(95)	(95)
Other (expense) income, net	(1,131)	481	590
Net loss	(139,303)	(44,372)	(104,133)
Total comprehensive loss	$ (139,303)	$ (44,372)	$ (104,133)
Basic net (loss) income per common share	$ (0.68)	$ (0.25)	$ (0.70)
Diluted net (loss) income per common share	$ (0.68)	$ (0.25)	$ (0.70)
Basic weighted average common shares outstanding (in shares)	206,147	176,153	148,311
Diluted weighted average common shares outstanding (in shares)	206,147	176,153	148,311
Non-cash royalty revenue related to the sale of future royalties
Revenues:
Total revenues	$ 46,808	$ 68,529	$ 47,415
License and milestone fees
Revenues:
Total revenues	22,650	63,742	34,788
Research and development support
Revenues:
Total revenues	$ 398	$ 28	$ 68

Employee Benefit Plans

12 Months Ended

Dec. 31, 2021

Employee Benefit Plans

Employee Benefit Plans

L.Employee Benefit Plans

The Company has a deferred compensation plan under Section 401(k) of the Internal Revenue Code (the 401(k) Plan). Under the 401(k) Plan, eligible employees are permitted to contribute, subject to certain limitations, up to 100% of their gross salary and the Company’s matching contribution is 50% of the first 6% of the eligible employees’ contributions. In the years ended December 31, 2021, 2020 and 2019, the Company’s contributions to the 401(k) Plan totaled $0.5 million, $0.4 million, and $0.8 million, respectively.

- Definition

The entire disclosure for retirement benefits.

+ References

Reference 1: http://www.xbrl.org/2003/role/exampleRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 715
-SubTopic 20
-Section 55
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-URI http://asc.fasb.org/extlink&oid=123450688&loc=d3e4179-114921

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 715
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Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-URI http://asc.fasb.org/topic&trid=2235017

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
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Reference 14: http://www.xbrl.org/2003/role/disclosureRef
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-URI http://asc.fasb.org/extlink&oid=123447040&loc=d3e1928-114920

+ Details

Summary of Significant Accounting Policies - Segment Information (Details) - segment	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Segment Information
Number of operating segments	1
Other customers \| Revenue \| Customer concentration
Segment Information
Percentages of revenue recognized		0.00%	0.00%	0.00%
Huadong \| Revenue \| Customer concentration
Segment Information
Percentages of revenue recognized	24.00%
Jazz \| Revenue \| Customer concentration
Segment Information
Percentages of revenue recognized		46.00%	18.00%
CytomX \| Revenue \| Customer concentration
Segment Information
Percentages of revenue recognized			13.00%
Royalty revenue \| Roche \| Revenue \| Customer concentration
Segment Information
Percentages of revenue recognized	67.00%	53.00%	64.00%

Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2021

Basis of Presentation and Significant Accounting Policies

Contract assets and contract liabilities

The following tables present changes in the Company’s contract assets and contract liabilities during the years ended December 31, 2021 and 2020 (in thousands):


	Balance at								Balance at
Year ended December 31, 2021	December 31, 2020		Additions		Deductions		Impact of Netting		December 31, 2021
Contract asset	$	—	$	5,500	$	(2,500)	$	—	$	3,000
Contract liabilities (deferred revenue)	$	110,109	$	4,753	$	(22,794)	$	—	$	92,068



	Balance at								Balance at
Year ended December 31, 2020	December 31, 2019		Additions		Deductions		Impact of Netting		December 31, 2020
Contract asset	$	3,631	$	—	$	(8,000)	$	4,369	$	—
Contract liabilities (deferred revenue)	$	127,432	$	42,050	$	(63,742)	$	4,369	$	110,109


	Year Ended
	December 31,
	2021		2020		2019
Revenue recognized in the period from:
Amounts included in contract liabilities at the beginning of the period	$	22,765	$	61,872	$	14,817
Performance obligations satisfied in previous periods	$	5,500	$	—	$	12,672

Schedule of assets that are required to be measured at fair value on a recurring basis

Fair Value Measurements at December 31, 2021

Quoted Prices in

Significant

Active Markets for

Significant Other

Unobservable

Identical Assets

Observable Inputs

Inputs

Total

(Level 1)

(Level 2)

(Level 3)

Cash equivalents

460,298

—

Fair Value Measurements at December 31, 2020

Quoted Prices in

Significant

Active Markets for

Significant Other

Unobservable

Identical Assets

Observable Inputs

Inputs

Total

(Level 1)

(Level 2)

(Level 3)

Cash equivalents

194,525

—

Schedule of components of other accrued liabilities

Other accrued liabilities consisted of the following at December 31, 2021 and 2020 (in thousands):


	December 31,		December 31,
	2021		2020
Accrued contract payments	$	5,558	$	15,576
Accrued clinical trial costs		15,556		11,401
Accrued professional services		839		1,200
Accrued employee benefits		40		39
Accrued public reporting charges		309		319
Other current accrued liabilities		775		785
Total	$	23,077	$	29,320

Schedule of estimated useful lives of property and equipment


Machinery and equipment		5 years
Computer hardware and software		3 years
Furniture and fixtures		5 years
Leasehold improvements		Shorter of remaining lease term or 7 years

Schedule of common stock equivalents, as calculated in accordance with the treasury-stock method



	Year Ended December 31,
	2021	2020	2019
Options outstanding to purchase common stock, shares issuable under the employee stock purchase plan, and unvested restricted stock/units at end of period	21,296	18,459	14,815
Common stock equivalents under treasury stock method for options, shares issuable under the employee stock purchase plan, and unvested restricted stock/units	2,546	1,301	1,020
Shares issuable upon conversion of convertible notes at end of period	—	501	501
Common stock equivalents under if-converted method for convertible notes	—	501	501

Schedule of risk-free rate of the stock options based on US Treasury rate


	Year Ended
	December 31,
	2021	2020	2019
Dividend	None	None	None
Volatility	84.67%	85.07%	76.67%
Risk-free interest rate	0.80%	1.21%	2.20%
Expected life (years)	6.0	6.0	6.0

Summary of stock option activity

A summary of option activity under the option plans for 2021 is presented below (in thousands, except weighted-average data):


		Weighted-		Weighted-
	Number	Average		Average	Aggregate
	of Stock	Exercise		Remaining	Intrinsic
	Options	Price		Life in Yrs.	Value
Outstanding at December 31, 2020	18,398	$	6.10
Granted	5,324		7.15
Exercised	(872)		3.51
Forfeited/Canceled	(1,631)		8.59
Outstanding at December 31, 2021	21,219	$	6.28	7.34	$	41,425
Exercisable at December 31, 2021	9,619	$	7.10	5.87	$	19,140
Vested and expected to vest at December 31, 2021	21,219	$	6.28	7.34	$	41,425

Summary of restricted stock activity


	Number of	Weighted-
	Restricted	Average Grant
	Stock Shares	Date Fair Value
Unvested at December 31, 2020	61	$	2.47
Granted	75		5.68
Vested	(2)		2.53
Forfeited	(57)		2.47
Unvested at December 31, 2021	77	$	5.59

Summary of vested stock option activity

A summary of option activity for options vested during the years ended December 31, 2021, 2020, and 2019 is presented below (in thousands):


	Year Ended December 31,
	2021		2020		2019
Total fair value of options vested	$	15,839	$	11,465	$	13,747
Total intrinsic value of options exercised		3,322		746		556
Cash received from the exercise of stock options and ESPP purchases		3,769		1,471		2,873

Schedule of percentage of total revenues recognized from each significant customer


	Year Ended December 31,
Collaborative Partner:	2021	2020	2019
Roche	67%	53%	64%
Huadong	24%	-%	-%
Jazz	-%	46%	18%
CytomX	-%	-%	13%

Summary of Significant Accounting Policies - Financial Instruments and Concentration of Credit Risk (Details) $ in Millions	12 Months Ended
	Dec. 31, 2021 USD ($) Institution	Dec. 31, 2020 USD ($)
Financial Instruments and Concentration of Credit Risk
Number of financial institutions in the U.S. in which cash and cash equivalents are primarily maintained \| Institution	3
Marketable securities held by entity \| $	$ 0.0	$ 0.0

Summary of Significant Accounting Policies - PPE (Details) - USD ($)	9 Months Ended	12 Months Ended
	Sep. 30, 2019	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Property and Equipment
Net gains (losses) related to impairment charges and the sale/disposal of furniture and equipment			$ 691,000	$ (1,689,000)
Leasehold impairment charge	$ 600,000
Asset Impairment Charges		$ 0	0	2,500,000
Machinery and equipment
Property and Equipment
Estimated useful lives		5 years
Computer hardware and software
Property and Equipment
Estimated useful lives		3 years
Furniture and fixtures
Property and Equipment
Estimated useful lives		5 years
Net gains (losses) related to impairment charges and the sale/disposal of furniture and equipment		$ 0	$ 700,000	$ (1,700,000)
Leasehold improvements \| Maximum
Property and Equipment
Estimated useful lives		7 years

Agreements - Roche (Details) $ in Thousands		1 Months Ended	12 Months Ended
Agreements - Roche (Details) $ in Thousands	May 03, 2019 USD ($)	Jan. 31, 2019 USD ($)	Dec. 31, 2021 USD ($)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 USD ($)	Dec. 31, 2000 USD ($) item
Collaborative Agreements disclosures
Non-cash royalty revenue related to sale of future royalties			$ 39,155	$ 68,529	$ 47,415
Revenue from contract with customer			69,856	132,299	82,271
License and milestone fees
Collaborative Agreements disclosures
Revenue from contract with customer			22,650	63,742	34,788
Roche \| Upfront payment
Collaborative Agreements disclosures
Revenue from contract with customer						$ 2,000
Roche \| License and milestone fees \| Development and regulatory milestones
Collaborative Agreements disclosures
Potential milestone payments						$ 44,000
Roche \| License and milestone fees \| Regulatory milestones
Collaborative Agreements disclosures
Revenue from contract with customer	$ 5,000
Roche \| KADCYLA
Collaborative Agreements disclosures
Non-cash royalty revenue related to sale of future royalties			46,800	$ 68,500	$ 47,400
Revenue from contract with customer			$ 39,000
Roche \| Undisclosed Target
Collaborative Agreements disclosures
Number of undisclosed targets with exclusive licenses \| item						4
Potential milestone payments						$ 38,000
Revenue from contract with customer						$ 1,000
OMERS \| KADCYLA
Collaborative Agreements disclosures
Non-cash royalty revenue related to sale of future royalties		$ 65,200
Percentage of royalty payments		100.00%

Agreements - Fusion (Details) - USD ($) $ in Thousands	12 Months Ended
Agreements - Fusion (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2016
Collaborative Agreements disclosures
Revenue from contract with customer	$ 69,856	$ 132,299	$ 82,271
Fusion Pharmaceuticals
Collaborative Agreements disclosures
Revenue from contract with customer	500
License and milestone fees
Collaborative Agreements disclosures
Revenue from contract with customer	22,650	63,742	34,788
License and milestone fees \| Fusion Pharmaceuticals
Collaborative Agreements disclosures
Potential milestone payment				$ 50,000
Research and development support
Collaborative Agreements disclosures
Revenue from contract with customer	$ 398	$ 28	$ 68

- Definition

+ References

+ Details

Property and Equipment (Tables)

12 Months Ended

Dec. 31, 2021

Property and Equipment

Schedule of components of property and equipment

Property and equipment consisted of the following at December 31, 2021 and 2020 (in thousands):


	December 31,		December 31,
	2021		2020
Leasehold improvements	$	22,051	$	21,890
Machinery and equipment		2,955		2,861
Computer hardware and software		5,846		5,636
Furniture and fixtures		3,265		3,039
Assets under construction		233		97
	$	34,350	$	33,523
Less accumulated depreciation		(29,687)		(27,763)
Property and equipment, net	$	4,663	$	5,760

Convertible 4.5 Senior Notes (Details) - USD ($) $ in Thousands		3 Months Ended	12 Months Ended
	Jul. 01, 2021	Jun. 30, 2021	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Sep. 30, 2020	Dec. 31, 2017	Dec. 31, 2016
Convertible debt
Convertible debt paid in cash	$ 1,100		$ 1,100
Interest rate (as a percent)			4.50%	4.50%
Interest expense			$ 47	$ 95	$ 95
Convertible 4.5% Senior Notes
Convertible debt
Convertible Notes Payable						$ 2,100
Principal amount of debt								$ 100,000
Convertible debt outstanding		$ 1,000
Shares issued with debt conversion (in shares)		238,777
Convertible debt paid in cash		$ 1,100
Interest rate (as a percent)			4.50%	4.50%			4.50%
Interest expense			$ 100	$ 100	$ 100

Liability Related to Sale of Future Royalties (Tables)

12 Months Ended

Dec. 31, 2021

Schedule of Liability account during the period from the inception of the royalty transaction

The following table shows the activity within the liability account during the year ended December 31, 2021 and the period from inception (in thousands):


			Period from
	Year Ended		inception to
	December 31, 2021		December 31, 2021
Liability related to sale of future royalties, net — beginning balance	$	85,439	$	—
Proceeds from sale of future royalties, net		—		194,135
KADCYLA royalty payments received and paid		(57,490)		(263,857)
Non-cash interest expense recognized		13,095		110,766
Liability related to sale of future royalties, net — ending balance	$	41,044	$	41,044

Agreements - Bayer (Details) - USD ($) $ in Thousands	12 Months Ended
Agreements - Bayer (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2008
Collaborative Agreements disclosures
Total revenues	$ 69,856	$ 132,299	$ 82,271
Upfront payment \| Bayer HealthCare
Collaborative Agreements disclosures
Total revenues				$ 4,000
License and milestone fees
Collaborative Agreements disclosures
Total revenues	22,650	$ 63,742	$ 34,788
License and milestone fees \| Bayer HealthCare
Collaborative Agreements disclosures
Total revenues	$ 13,000
Potential milestone payment				$ 170,500

- Definition

+ References

+ Details

Restructuring Charges

12 Months Ended

Dec. 31, 2021

Restructuring Charges

Restructuring Charges

I.Restructuring Charge

2019 Corporate Restructuring

On June 26, 2019, the Board of Directors approved a plan to restructure the business to focus resources on continued development of mirvetuximab and a select portfolio of three earlier-stage product candidates, resulting in a significant reduction of the Company’s workforce, with a majority of these employees separating from the business by mid-July 2019 and most of the remaining affected employees transitioning over varying periods of time of up to 12 months. Communication of the plan to the affected employees was substantially completed on June 27, 2019.

As a result of the workforce reduction, the Company recorded a $16.0 million charge for severance during the year ended December 31, 2019 related to a pre-existing plan in accordance with ASC 712, Compensation-Nonretirement Postemployment Benefits, as such amounts were probable and reasonably estimable. The estimate was reduced during 2020 to $15.3 million due to minor adjustments to the plan. The related cash payments were substantially paid out by June 30, 2020. In addition, a charge of $4.0 million was incurred for incremental retention benefits over the same time period, of which $1.6 million and $2.4 million was recorded during the years ended December 31, 2020 and 2019, respectively.

A summary of activity against the 2019 corporate restructuring charge related to the employee terminations is as follows:


		Employee
		Termination
		Benefits Costs
Balance at December 31, 2020	$	784
Additional charges/adjustments during the period		—
Payments during the period		(443)
Balance at December 31, 2021	$	341

In addition to the termination benefits and other related charges, the Company has sub-leased laboratory and office space at 830 Winter Street in Waltham, Massachusetts no longer used in the business. The decision to vacate part of its corporate office resulted in a change in asset groupings and also represented an impairment indicator. The Company determined and continues to believe that the related right-of-use asset and leasehold improvements are recoverable based on expected sublease income, and therefore, no impairment has been recorded.

In addition, the Company also decided to liquidate excess laboratory equipment and expected the proceeds to be less than the carrying value. As a result, in 2019, the Company recorded an impairment charge of $2.5 million to write down the equipment to fair value based on current market re-sale estimates obtained.

Charge Related to Unoccupied Office Space

The Company sought to sub-lease 10,281 square feet of unoccupied office space at 930 Winter Street in Waltham, Massachusetts that was leased in 2016. During 2019, the Company recorded a $0.6 million impairment charge related to this lease, which represented the remaining balance of the right to use asset as the likelihood of finding a sub-lessor had diminished significantly as the lease approached termination in August 2021.

Summary of Significant Accounting Policies - Stock-Based Compensation (Details)	1 Months Ended	12 Months Ended
	Jun. 30, 2018 shares	Dec. 31, 2021 USD ($) plan $ / shares shares	Dec. 31, 2020 USD ($) $ / shares shares	Dec. 31, 2019 USD ($) $ / shares shares
Stock-Based Compensation
Number of employee share-based compensation plans \| plan		3
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract]
Aggregate number of common shares reserved for future issuance		33,600,000
Total fair value of options vested \| $		$ 15,839,000	$ 11,465,000	$ 13,747,000
Total intrinsic value of options exercised \| $		3,322,000	746,000	556,000
Cash received from the exercise of stock options and ESPP \| $		$ 3,769,000	1,471,000	2,873,000
Directors' deferred share unit compensation \| $			$ 343,000	$ 337,000
ESPP
Weighted-Average Grant Date Fair Value
Granted (in dollars per share) \| $ / shares		$ 1.20	$ 2.29
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract]
Aggregate number of common shares reserved for future issuance	2,000,000
Shares issued to participating employees		126,000	122,000	356,000
Share-based Compensation Arrangement by Share-based Payment Award, Purchase Price of Common Stock, Percent	85.00%
Stock options and restricted stock awards
Stock-Based Compensation
Vesting period		2 years 10 months 24 days
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract]
Stock compensation expense \| $		$ 16,800,000	$ 14,000,000.0	$ 13,800,000
Estimated fair value that could be expensed \| $		28,600,000
Directors' deferred share unit compensation \| $		$ 700,000	$ 400,000	$ 300,000
Stock options
Stock-Based Compensation
Share-based Compensation Arrangement by Share-based Payment Award		3,500,000
Weighted-average assumptions used to estimate the fair value of each stock option
Dividend (as a percent)		0.00%	0.00%	0.00%
Volatility (as a percent)		84.67%	85.07%	76.67%
Risk-free interest rate (as a percent)		0.80%	1.21%	2.20%
Expected life		6 years	6 years	6 years
Weighted-average grant date fair value (in dollars per share) \| $ / shares		$ 5.07	$ 3.28	$ 2.81
Number of Stock Options
Outstanding at the beginning of the period (in shares)		18,398,000
Granted (in shares)		5,324,000
Exercised (in shares)		(872,000)
Forfeited/Canceled (in shares)		(1,631,000)
Outstanding at the end of the period (in shares)		21,219,000	18,398,000
Vested or unvested and expected to vest at the end of the period (in shares)		21,219,000
Exercisable at the end of the period (in shares)		9,619,000
Weighted-Average Exercise Price
Outstanding at the beginning of the period (in dollars per share) \| $ / shares		$ 6.10
Granted (in dollars per share) \| $ / shares		7.15
Exercised (in dollars per share) \| $ / shares		3.51
Forfeited/Canceled (in dollars per share) \| $ / shares		8.59
Outstanding at the end of the period (in dollars per share) \| $ / shares		6.28	$ 6.10
Vested or unvested and expected to vest at the end of the period (in dollars per share) \| $ / shares		6.28
Exercisable at the end of the period (in dollars per share) \| $ / shares		$ 7.10
Weighted-Average Remaining Life (in years)
Outstanding at the end of the period		7 years 4 months 2 days
Vested or unvested and expected to vest at the end of the period		7 years 4 months 2 days
Exercisable at the end of the period		5 years 10 months 13 days
Aggregate Intrinsic Value
Outstanding at the end of the period \| $		$ 41,425,000
Vested or unvested and expected to vest at the end of the period \| $		41,425,000
Exercisable at the end of the period \| $		19,140,000
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract]
Cash received from the exercise of stock options and ESPP \| $		$ 3,100,000
Stock options \| Maximum
Stock-Based Compensation
Vesting period		4 years
Exercise period		10 years
Performance shares
Number of Restricted Stock Shares
Granted (in shares)			2,600,000
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract]
Stock compensation expense \| $		$ 2,600,000
Estimated fair value that could be expensed \| $		$ 7,800,000
Restricted stock
Number of Restricted Stock Shares
Unvested at the beginning of the period (in shares)		61,000
Granted (in shares)		75,000
Vested (in shares)		(2,000)
Forfeited (in shares)		(57,000)
Unvested at the end of the period (in shares)		77,000	61,000
Weighted-Average Grant Date Fair Value
Unvested at the beginning of the period (in dollars per share) \| $ / shares		$ 2.47
Granted (in dollars per share) \| $ / shares		5.68
Vested (in dollars per share) \| $ / shares		2.53
Forfeited (in dollars per share) \| $ / shares		2.47
Unvested at the end of the period (in dollars per share) \| $ / shares		$ 5.59	$ 2.47
Immunogen Inc Restated Stock Option Plan
Stock-Based Compensation
Common stock authorized for issuance (in shares)		22,392,986
2018 Plan
Stock-Based Compensation
Common stock authorized for issuance (in shares)		6,600,000
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract]
Aggregate number of common shares reserved for future issuance		32,800,000
2018 Plan \| Stock options
Weighted-average assumptions used to estimate the fair value of each stock option
Number of group of awards for which expected term is calculated for and applied \| $		1
Number of Stock Options
Exercised (in shares)		(872,000)

Summary of Significant Accounting Policies - Contract Balances (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Changes in the Company's contract assets and contract liabilities
Contract asset, Beginning balance		$ 3,631
Contract asset, Additions	$ 5,500
Contract asset, Deductions	(2,500)	(8,000)
Contract asset, Impact of Netting.		4,369
Contract asset, Ending balance	3,000
Contract liabilities:
Contract liabilities (deferred revenue), Beginning balance	110,109	127,432
Contract liabilities (deferred revenue), Additions	4,753	42,050
Contract liabilities (deferred revenue), Deductions	(22,794)	(63,742)
Contract Liabilities (deferred revenue), Impact of Netting		4,369
Contract liabilities (deferred revenue), Ending balance	92,068	110,109
CytomX and Novartis \| Probable Milestone
Changes in the Company's contract assets and contract liabilities
Contract asset, Beginning balance		3,600
Contract liabilities:
Contract Liabilities (deferred revenue), Impact of Netting			$ (4,400)
CytomX and Novartis \| Future Technological Improvements
Contract liabilities:
Contract liabilities (deferred revenue), Beginning balance		300
KADCYLA \| Royalty revenue
Contract liabilities:
Contract liabilities (deferred revenue), Beginning balance		65,200
CytomX
Contract liabilities:
Contract liabilities (deferred revenue), Beginning balance		$ 200
CytomX \| Probable Milestone
Changes in the Company's contract assets and contract liabilities
Contract asset, Ending balance	3,600
Hangzhou Zhongmei Huadong Pharmaceutical Co., Ltd \| Upfront payment
Contract liabilities:
Contract liabilities (deferred revenue), Ending balance	$ 40,000

Income Taxes - Narrative (Details)	12 Months Ended
Income Taxes - Narrative (Details)	Dec. 31, 2021 USD ($)	Dec. 31, 2020 USD ($)	Dec. 31, 2015
Tax Cuts and Jobs Act (TCJA)
Increase in valuation allowance	$ 47,000,000.0
U.S. federal corporate tax rate (as a percent)	21.00%
Income Tax Uncertainties
Ownership change occurred, based off study			0
Uncertain tax positions reported	$ 0	$ 0

Summary of Significant Accounting Policies - Fair Value of Financial Instruments (Details) $ / shares in Units, $ in Thousands		3 Months Ended	12 Months Ended
	Jul. 01, 2021 USD ($)	Jun. 30, 2021 USD ($)	Dec. 31, 2021 USD ($) item $ / shares shares	Dec. 31, 2020 USD ($) $ / shares	Dec. 31, 2017
Fair value hierarchy for the Company's financial assets measured at fair value
Interest rate (as a percent)			4.50%	4.50%
Convertible debt amount			$ 1,000
Convertible debt paid in cash	$ 1,100		$ 1,100
Number of trades \| item			0
Common stock, par value (in dollars per share) \| $ / shares			$ 0.01	$ 0.01
Convertible 4.5% Senior Notes
Fair value hierarchy for the Company's financial assets measured at fair value
Interest rate (as a percent)			4.50%	4.50%	4.50%
Convertible debt amount			$ 1,000
Convertible debt, number of common shares issued \| shares			238,777
Convertible debt paid in cash		$ 1,100
Significant Other Observable Inputs (Level 2) \| Convertible 4.5% Senior Notes \| Estimated fair value
Fair value hierarchy for the Company's financial assets measured at fair value
Convertible debt fair value				$ 4,300
Significant Other Observable Inputs (Level 2) \| Convertible 4.5% Senior Notes \| Face Value
Fair value hierarchy for the Company's financial assets measured at fair value
Gross carrying amount				2,100
Recurring basis
Fair value hierarchy for the Company's financial assets measured at fair value
Cash equivalents			$ 460,298	194,525
Recurring basis \| Quoted Prices in Active Markets for Identical Assets (Level 1)
Fair value hierarchy for the Company's financial assets measured at fair value
Cash equivalents			$ 460,298	$ 194,525

Restructuring Charges (Details) $ in Thousands	3 Months Ended	9 Months Ended	12 Months Ended
Restructuring Charges (Details) $ in Thousands	Jun. 30, 2019 USD ($)	Sep. 30, 2019 USD ($)	Dec. 31, 2021 USD ($) ft²	Dec. 31, 2020 USD ($)	Dec. 31, 2019 USD ($)
Restructuring charge
Unoccupied office space for sub-lease \| ft²			10,281
Leasehold impairment charge		$ 600
Workforce reduction
Restructuring charge
Balance at beginning of the period			$ 784
Additional charges/adjustments during the period				$ 15,300
Payments during the period			(443)
Balance at end of the period			341	784
Workforce reduction \| 2019 Corporate Restructuring
Restructuring
Charge for severance related to a pre-existing plan					$ 16,000
Lease \| 2019 Corporate Restructuring
Restructuring charge
Impairment charge to write down excess equipment to fair value	$ 2,500
Incremental retention benefits \| 2019 Corporate Restructuring
Restructuring
Severance costs, charges incurred	$ 4,000		$ 1,600	$ 2,400

Convertible 4.5 Senior Notes

12 Months Ended

Dec. 31, 2021

Convertible 4.5% Senior Notes.

Convertible 4.5% Senior Notes

E.Convertible 4.5% Senior Notes

In 2016, the Company issued convertible notes with an aggregate principal amount of $100 million, of which $2.1 million remained outstanding as of December 31, 2020. In June 2021, $1.0 million of outstanding convertible notes were converted into 238,777 shares of the Company’s common stock and the remaining $1.1 million outstanding was repaid in full by a cash payment upon maturity on July 1, 2021. The convertible notes were senior unsecured obligations and bore interest at a rate of 4.5% per year, payable semi-annually in arrears on January 1 and July 1 of each year, commencing on January 1, 2017. The Company recorded $0.1 million of interest expense in each of the years ended December 31, 2021, 2020 and 2019, respectively. The Company analyzed the terms of the convertible notes and determined the notes were entirely accounted for as debt and none of the terms of the notes required separate accounting.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-URI http://asc.fasb.org/topic&trid=2208564

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (h)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1C
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(c))
-URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (g)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1C
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1C
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1E
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495348-112611

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (i)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

+ Details

Summary of Significant Accounting Policies - Contract Balances from Contracts with Customers - Additional Information (Details) - USD ($) $ in Thousands	1 Months Ended				2 Months Ended	12 Months Ended
	Oct. 31, 2021	Oct. 31, 2020	Dec. 31, 2019	Mar. 31, 2015	Dec. 31, 2021	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2000
Revenue recognized in the period from:
Revenue recognized, previously deferred							$ 22,765	$ 61,872	$ 14,817
Revenue from contract with customer							69,856	132,299	82,271
Contract assets			$ 3,631		$ 3,000		3,000		3,631
Contract liability					44,351		44,351	29,249
Deferred revenue			127,432		92,068		92,068	110,109	127,432
License and milestone fees
Revenue recognized in the period from:
Revenue from contract with customer							22,650	63,742	34,788
Upfront payment
Revenue recognized in the period from:
Contract liability					1,400		1,400
Total Revenue Recognized From Both The Beginning Balance And Current Period Increase In Contract Liability					3,200		3,200
Upfront Option Fee
Revenue recognized in the period from:
Deferred revenue					1,600		1,600
CytomX and Novartis \| License and milestone fees
Revenue recognized in the period from:
Revenue from contract with customer									7,700
CytomX and Novartis \| Future Technological Improvements
Revenue recognized in the period from:
Deferred revenue			300						300
CytomX and Novartis \| Probable Milestone
Revenue recognized in the period from:
Contract assets			3,600						3,600
Contract liability					4,400		4,400
Roche \| Upfront payment
Revenue recognized in the period from:
Revenue from contract with customer										$ 2,000
Roche \| KADCYLA
Revenue recognized in the period from:
Revenue from contract with customer							39,000
Genentech \| Regulatory milestones
Revenue recognized in the period from:
Revenue from contract with customer									5,000
CytomX
Revenue recognized in the period from:
Deferred revenue			200						200
CytomX \| License and milestone fees
Revenue recognized in the period from:
Revenue from contract with customer			7,300				4,000
Deferred revenue					200		200
CytomX \| Upfront payment
Revenue recognized in the period from:
Revenue from contract with customer							7,500		7,500
CytomX \| Probable Milestone
Revenue recognized in the period from:
Contract assets					3,600		3,600
Jazz
Revenue recognized in the period from:
Revenue recognized, previously deferred								$ 60,500	14,500
Jazz \| License and milestone fees
Revenue recognized in the period from:
Amortization of deferred revenue							60,500
Jazz \| Upfront payment
Revenue recognized in the period from:
Revenue from contract with customer						$ 75,000
KADCYLA
Revenue recognized in the period from:
Net proceeds from sale of residual rights to receive royalty payments							7,700
KADCYLA \| Royalty revenue
Revenue recognized in the period from:
Deferred revenue			$ 65,200						65,200
Takeda \| License and milestone fees
Revenue recognized in the period from:
Revenue from contract with customer							900
Takeda \| Upfront payment
Revenue recognized in the period from:
Revenue from contract with customer				$ 20,000
Amgen
Revenue recognized in the period from:
Revenue from contract with customer							1,000
Amgen \| Upfront payment
Revenue recognized in the period from:
Revenue from contract with customer							1,000
Fusion Pharmaceuticals
Revenue recognized in the period from:
Revenue from contract with customer							500
Other Collaborator \| Future Technological Improvements
Revenue recognized in the period from:
Amortization of deferred revenue									$ 300
Hangzhou Zhongmei Huadong Pharmaceutical Co., Ltd \| Upfront payment
Revenue recognized in the period from:
Revenue recognized, previously deferred							0
Deferred revenue					40,000		40,000
Viridian \| License and milestone fees
Revenue recognized in the period from:
Revenue from contract with customer							200
Viridian \| Future Technological Improvements
Revenue recognized in the period from:
Revenue recognized, previously deferred							300
Viridian \| Probable Milestone
Revenue recognized in the period from:
Contract assets					3,000		3,000
Huadong
Revenue recognized in the period from:
Deferred revenue					28,600		28,600
Huadong \| License and milestone fees
Revenue recognized in the period from:
Revenue from contract with customer							1,800
Deferred revenue					25,400		25,400
Huadong \| Upfront payment
Revenue recognized in the period from:
Revenue from contract with customer		$ 40,000
Estimated payments to received		$ 40,000					40,000
Development milestones \| Viridian \| License and milestone fees
Revenue recognized in the period from:
Revenue from contract with customer	$ 2,500				3,000		2,500
Development milestones \| Huadong \| License and milestone fees
Revenue recognized in the period from:
Revenue from contract with customer							5,000
Development milestones \| Huadong \| Upfront payment
Revenue recognized in the period from:
Deferred revenue					$ 3,200		$ 3,200

Agreements - Novartis (Details) $ in Thousands	1 Months Ended		12 Months Ended
Agreements - Novartis (Details) $ in Thousands	Sep. 30, 2020 USD ($)	May 31, 2018 item	Dec. 31, 2021 USD ($) item	Dec. 31, 2020 USD ($)	Dec. 31, 2019 USD ($)	Dec. 31, 2016 USD ($)	Dec. 31, 2015 USD ($)	Dec. 31, 2010 USD ($) item
Collaborative Agreements disclosures
Revenue from contract with customer			$ 69,856	$ 132,299	$ 82,271
Contract with Customer, Liability			$ 92,068	110,109	127,432
Novartis
Collaborative Agreements disclosures
Number of single-target licenses \| item			5					6
Number of licenses terminated \| item		6
Novartis \| Development milestones
Collaborative Agreements disclosures
Revenue from contract with customer						$ 5,000	$ 5,000
Novartis \| Phase I clinical trial
Collaborative Agreements disclosures
Revenue from contract with customer	$ 5,000			4,700
Potential milestone payment				5,000
Contract with Customer, Liability			$ 300
Upfront payment \| Novartis
Collaborative Agreements disclosures
Revenue from contract with customer								$ 45,000
License and milestone fees
Collaborative Agreements disclosures
Revenue from contract with customer			22,650	63,742	34,788
License and milestone fees \| Novartis
Collaborative Agreements disclosures
Potential milestone payment								199,500
Exercise fee \| Novartis
Collaborative Agreements disclosures
Revenue from contract with customer								1,000
Research and development support
Collaborative Agreements disclosures
Revenue from contract with customer			$ 398	$ 28	$ 68
Extension and amendment fee \| Novartis
Collaborative Agreements disclosures
Revenue from contract with customer								$ 8,500

Agreements - Huadong (Details) - USD ($) $ in Thousands	1 Months Ended	12 Months Ended
Agreements - Huadong (Details) - USD ($) $ in Thousands	Oct. 31, 2020	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Collaborative Agreements disclosures
Revenue from contract with customer		$ 69,856	$ 132,299	$ 82,271
Revenue recognized, previously deferred		22,765	61,872	14,817
Deferred revenue		92,068	110,109	127,432
Huadong
Collaborative Agreements disclosures
Deferred revenue		28,600
Upfront payment \| Huadong
Collaborative Agreements disclosures
Revenue from contract with customer	$ 40,000
Estimated payments to received	40,000	40,000
Upfront payment \| Huadong \| Development milestones
Collaborative Agreements disclosures
Deferred revenue		3,200
License and milestone fees
Collaborative Agreements disclosures
Revenue from contract with customer		22,650	$ 63,742	$ 34,788
License and milestone fees \| Huadong
Collaborative Agreements disclosures
Revenue from contract with customer		1,800
Potential milestone payment		14,600
Deferred revenue		25,400
License and milestone fees \| Huadong \| Development milestones
Collaborative Agreements disclosures
Revenue from contract with customer		$ 5,000
License and milestone fees \| Huadong \| Sales milestones
Collaborative Agreements disclosures
Potential milestone payment	$ 265,000
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 \| Huadong
Collaborative Agreements disclosures
Remaining performance obligation, expected timing of satisfaction		2 years

Liability Related to Sale of Future Royalties (Details) - USD ($) $ in Thousands	1 Months Ended		3 Months Ended	12 Months Ended				84 Months Ended
	Jan. 31, 2019	May 31, 2000	Jun. 30, 2021	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2015	Dec. 31, 2021
Liability Related to Sale of Future Royalties
Non-cash royalty revenue related to the sale of future royalties				$ 39,155	$ 68,529	$ 47,415
KADCYLA
Liability Related to Sale of Future Royalties
Percentage of royalty payments if applicable threshold is met							85.00%
IRH \| KADCYLA
Liability Related to Sale of Future Royalties
Percentage of royalty payments							100.00%
Proceeds from sale of future royalties				200,000			$ 200,000
Percentage of royalty payments if applicable threshold is met							15.00%
Transaction costs for royalty agreements							$ 5,900
Change in liability related to sale of future royalties
Liability related to sale of future royalties, net - beginning balance				85,439
Proceeds from sale of future royalties, net								$ 194,135
Royalty payments received and paid				(57,490)				(263,857)
Non-cash interest expense recognized				13,095				110,766
Liability related to sale of future royalties, net - ending balance				$ 41,044	85,439			$ 41,044
Effective annual interest rate				10.50%
Current effective interest rate				19.5
IRH \| KADCYLA \| Maximum
Liability Related to Sale of Future Royalties
Royalties threshold							260,000
IRH \| KADCYLA \| Minimum
Liability Related to Sale of Future Royalties
Royalties threshold							$ 235,000
OMERS \| KADCYLA
Liability Related to Sale of Future Royalties
Percentage of royalty payments	100.00%
Non-cash royalty revenue related to the sale of future royalties	$ 65,200
Contingent broker fees	1,500
Net proceeds from sale of residual rights to receive royalty payments	$ 65,200		$ 7,700
Roche
Liability Related to Sale of Future Royalties
Period in arrears to receive royalty reports and payments related to sales of Kadcyla		3 months
Roche \| KADCYLA
Liability Related to Sale of Future Royalties
Non-cash royalty revenue related to the sale of future royalties				$ 46,800	$ 68,500	$ 47,400

Capital Stock (Details) $ / shares in Units, $ in Thousands		12 Months Ended
Capital Stock (Details) $ / shares in Units, $ in Thousands	Aug. 11, 2021 USD ($) $ / shares shares	Dec. 31, 2021 USD ($) $ / shares shares	Dec. 31, 2020 USD ($) $ / shares shares	Dec. 31, 2019 USD ($) shares	Aug. 31, 2021 $ / shares	Jun. 30, 2018 shares
Stock-based compensation disclosure
Aggregate number of common shares reserved for future issuance		33,600,000
Proceeds from issuance of common stock under stock plans \| $		$ 3,769	$ 1,471	$ 2,873
Common stock, par value (in dollars per share) \| $ / shares		$ 0.01	$ 0.01
Exercise price \| $ / shares		6.60
Warrant exercise price \| $ / shares		$ 0.01			$ 0.01
Transaction costs \| $		$ 373	$ 701
Proceeds from issuance of convertible bonds, issuance costs \| $		373	$ 701
ESPP
Stock-based compensation disclosure
Aggregate number of common shares reserved for future issuance						2,000,000
Proceeds from Stock Plans \| $		$ 700
Stock Issued During Period, Shares, Employee Stock Purchase Plans		126,000
Pre-Funded Warrants
Stock-based compensation disclosure
Exercise price \| $ / shares		$ 6.59
Threshold percentage of common stock owned that limits the number of warrants exercised	9.99
Maximum percentage upon at least 61 days prior notice from the investor to the Company	19.99
RA Capital Healthcare Fund, L.P. \| Pre-Funded Warrants
Stock-based compensation disclosure
Pre-Funded warrants issued to purchase shares		16,000,000
Redmile Group LLC \| Pre-Funded Warrants
Stock-based compensation disclosure
Pre-Funded warrants issued to purchase shares		11,363,636
Stock options
Stock-based compensation disclosure
Stock options granted to directors (in shares)		5,324,000
Options exercised (in shares)		872,000
Exercise price (in dollars per share) \| $ / shares		$ 1.84
Exercise price (in dollars per share) \| $ / shares		$ 7.07
Proceeds from issuance of common stock under stock plans \| $		$ 3,100
Exercisable at the end of the period (in shares)		9,619,000
Weighted-Average Exercise Price (in dollars per share) \| $ / shares		$ 7.10
Securities Purchase Agreement \| RA Capital Healthcare Fund, L.P. \| Pre-Funded Warrants
Stock-based compensation disclosure
Pre-Funded warrants issued to purchase shares	5,434,782
Exercise price \| $ / shares	$ 5.51
Aggregate gross proceeds \| $	$ 29,900
Transaction costs \| $	200
Proceeds from issuance of convertible bonds, issuance costs \| $	$ 200
2018 Plan
Stock-based compensation disclosure
Aggregate number of common shares reserved for future issuance		32,800,000
2018 Plan \| Stock options
Stock-based compensation disclosure
Options exercised (in shares)		872,000
Compensation Policy for Non-Employee Directors \| Stock options
Stock-based compensation disclosure
Stock options granted to directors (in shares)		352,000	300,000	108,000
Compensation Policy for Non-Employee Directors \| Deferred share units
Stock-based compensation disclosure
Compensation expense \| $		$ 700	$ 300	$ 300
Common stock issued to retiring directors (in shares)		166,000	127,000	63,000
Common stock issued when a director ceases to be a member (in shares)		1
Stock units previously granted (in shares)		52,000	15,000	18,000

Income Taxes - Benefit for income taxes (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Reconciliation of the expected statutory tax benefit to the actual income taxes
U.S. federal corporate tax rate (as a percent)	21.00%
Loss before income tax expense	$ (139,303)	$ (44,372)	$ (104,133)
Expected tax benefit at 21%	(29,254)	(9,318)	(21,868)
Permanent differences	606	157	320
Incentive stock options	420	201	569
State tax benefit net of federal benefit	(7,376)	(2,250)	(6,726)
Change in valuation allowance, net	46,987	15,175	27,812
Federal research credit	(575)	(228)	(1,652)
Federal orphan drug credit	(7,429)	(6,218)	(4,426)
Expired loss and credit carryforwards	345	419	500
Withholding tax credit	(4,789)
Stock option expirations	1,065	2,062	5,471
Benefit for income taxes	$ 0	$ 0	$ 0

Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2021

Basis of Presentation and Significant Accounting Policies

Basis of Presentation and Significant Accounting Policies

B.Summary of Significant Accounting Policies

Principles of Consolidation

Use of Estimates

Subsequent Events

Revenue Recognition

At December 31, 2021, the Company had the following types of material agreements with the parties identified below:

●

Bayer (one exclusive single-target license)

CytomX (two exclusive single-target licenses)

Debiopharm (one exclusive single-compound license)

Fusion Pharmaceuticals (one exclusive single-target license)

Hangzhou Zhongmei Huadong Pharmaceutical Co., Ltd. (one territory-specific exclusive single-compound license)

Novartis (five exclusive single-target licenses)

Oxford BioTherapeutics/Menarini (one exclusive single-target license sublicensed from Amgen)

Roche, through its Genentech unit (five exclusive single-target licenses)

Viridian (one exclusive single-target license)

●

Collaboration and license agreement to co-develop and co-commercialize a specified anticancer compound on established terms:

MacroGenics

There are no performance, cancellation, termination, or refund provisions in any of the arrangements that contain material financial consequences to the Company.

Development and Commercialization Licenses

The Company recognizes revenue related to the rights to future technological improvements over the estimated term of the applicable license.

Collaboration and Option Agreements/Right-to-Test Agreements

Transaction Price Allocated to Remaining Performance Obligations

Contract Balances from Contracts with Customers

The following tables present changes in the Company’s contract assets and contract liabilities during the years ended December 31, 2021 and 2020 (in thousands):


	Balance at								Balance at
Year ended December 31, 2021	December 31, 2020		Additions		Deductions		Impact of Netting		December 31, 2021
Contract asset	$	—	$	5,500	$	(2,500)	$	—	$	3,000
Contract liabilities (deferred revenue)	$	110,109	$	4,753	$	(22,794)	$	—	$	92,068



	Balance at								Balance at
Year ended December 31, 2020	December 31, 2019		Additions		Deductions		Impact of Netting		December 31, 2020
Contract asset	$	3,631	$	—	$	(8,000)	$	4,369	$	—
Contract liabilities (deferred revenue)	$	127,432	$	42,050	$	(63,742)	$	4,369	$	110,109


	Year Ended
	December 31,
	2021		2020		2019
Revenue recognized in the period from:
Amounts included in contract liabilities at the beginning of the period	$	22,765	$	61,872	$	14,817
Performance obligations satisfied in previous periods	$	5,500	$	—	$	12,672

Financial Instruments and Concentration of Credit Risk

Cash and Cash Equivalents

Non-cash Investing Activities

Fair Value of Financial Instruments

●

Level 1—Quoted prices in active markets for identical assets or liabilities.

●

Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

Fair Value Measurements at December 31, 2021

Quoted Prices in

Significant

Active Markets for

Significant Other

Unobservable

Identical Assets

Observable Inputs

Inputs

Total

(Level 1)

(Level 2)

(Level 3)

Cash equivalents

460,298

—

Fair Value Measurements at December 31, 2020

Quoted Prices in

Significant

Active Markets for

Significant Other

Unobservable

Identical Assets

Observable Inputs

Inputs

Total

(Level 1)

(Level 2)

(Level 3)

Cash equivalents

194,525

—

The fair value of the Company’s cash equivalents is based primarily on quoted prices from active markets.

Unbilled Receivable

Unbilled receivable primarily represents research funding earned based on actual resources utilized and external expenses incurred under certain of the Company’s collaborator agreements.

Clinical Trial Accruals

Leases

Other Accrued Liabilities

Other accrued liabilities consisted of the following at December 31, 2021 and 2020 (in thousands):


	December 31,		December 31,
	2021		2020
Accrued contract payments	$	5,558	$	15,576
Accrued clinical trial costs		15,556		11,401
Accrued professional services		839		1,200
Accrued employee benefits		40		39
Accrued public reporting charges		309		319
Other current accrued liabilities		775		785
Total	$	23,077	$	29,320

Research and Development Expenses

Income Taxes

Property and Equipment

Property and equipment are stated at cost. The Company provides for depreciation based upon expected useful lives using the straight-line method over the following estimated useful lives:


Machinery and equipment		5 years
Computer hardware and software		3 years
Furniture and fixtures		5 years
Leasehold improvements		Shorter of remaining lease term or 7 years

Equipment under capital leases is amortized over the lives of the respective leases or the estimated useful lives of the assets, whichever is shorter, and included in depreciation expense.

Impairment of Long-Lived Assets

Common Stock Warrants

Computation of Net Loss per Common Share



	Year Ended December 31,
	2021	2020	2019
Options outstanding to purchase common stock, shares issuable under the employee stock purchase plan, and unvested restricted stock/units at end of period	21,296	18,459	14,815
Common stock equivalents under treasury stock method for options, shares issuable under the employee stock purchase plan, and unvested restricted stock/units	2,546	1,301	1,020
Shares issuable upon conversion of convertible notes at end of period	—	501	501
Common stock equivalents under if-converted method for convertible notes	—	501	501

The Company’s common stock equivalents have not been included in the net loss per share calculation because their effect is anti-dilutive due to the Company’s net loss position.

Stock-based Compensation

As of December 31, 2021, the Company is authorized to grant future awards under three employee share-based compensation plans, which are the ImmunoGen, Inc. 2018 Employee, Director and Consultant Equity Incentive Plan, or the 2018 Plan, the Employee Stock Purchase Plan, or ESPP, and the ImmunoGen Inducement Equity Incentive Plan, or the Inducement Plan. At the annual meeting of shareholders on June 16, 2021, the 2018 Plan was amended to provide for the issuance of stock grants, the grant of options, and the grant of stock-based awards for up to 6,600,000 shares of the Company’s common stock, as well as up to 22,392,986 shares of common stock, which represent the number of shares of common stock remaining under the 2018 Plan as of March 31, 2021, and shares of the Company’s common stock represented by awards granted under the ImmunoGen, Inc. 2016 and 2006 Employee, Director and Consultant Equity Incentive Plans, that may forfeit, expire, or cancel without delivery of shares of common stock or which resulted in the forfeiture of shares of common stock back to the Company on or after March 31, 2021. The Inducement Plan was approved by the Board of Directors in December 2019, and pursuant to subsequent amendments, provided for the issuance of non-qualified option grants for up to 3,500,000 shares of the Company’s common stock as of December 31, 2021. Options awarded under the two plans are granted with an exercise price equal to the market price of the Company’s stock at the date of grant. Options vest at various periods of up to four years and may be exercised within ten years of the date of grant.

The stock-based awards are accounted for under ASC 718, “Compensation—Stock Compensation.” Pursuant to ASC 718, the estimated grant date fair value of awards is charged to the statement of operations over the requisite service period, which is the vesting period. The fair value of each stock option is estimated on the date of grant using the Black-Scholes option-pricing model with the weighted-average assumptions noted in the following table. As the Company has not paid dividends since inception, nor does it expect to pay any dividends for the foreseeable future, the expected dividend yield assumption is zero. Expected volatility is based exclusively on historical volatility of the Company’s stock. The expected term of stock options granted is based exclusively on historical data and represents the period of time that stock options granted are expected to be outstanding. The expected term is calculated for and applied

to one group of stock options as the Company does not expect substantially different exercise or post-vesting termination behavior amongst its employee population. The risk-free rate of the stock options is based on the U.S. Treasury rate in effect at the time of grant for the expected term of the stock options.


	Year Ended
	December 31,
	2021	2020	2019
Dividend	None	None	None
Volatility	84.67%	85.07%	76.67%
Risk-free interest rate	0.80%	1.21%	2.20%
Expected life (years)	6.0	6.0	6.0

Using the Black-Scholes option-pricing model, the weighted-average grant date fair values of options granted during the years ended December 31, 2021, 2020, and 2019, were $5.07, $3.28, and $2.81 per share, respectively.

A summary of option activity under the option plans for 2021 is presented below (in thousands, except weighted-average data):


		Weighted-		Weighted-
	Number	Average		Average	Aggregate
	of Stock	Exercise		Remaining	Intrinsic
	Options	Price		Life in Yrs.	Value
Outstanding at December 31, 2020	18,398	$	6.10
Granted	5,324		7.15
Exercised	(872)		3.51
Forfeited/Canceled	(1,631)		8.59
Outstanding at December 31, 2021	21,219	$	6.28	7.34	$	41,425
Exercisable at December 31, 2021	9,619	$	7.10	5.87	$	19,140
Vested and expected to vest at December 31, 2021	21,219	$	6.28	7.34	$	41,425

In 2020, the Company issued 2.6 million performance-based stock options to certain employees, all of which remained outstanding as of December 31, 2021, that will vest upon the achievement of specified performance goals. In October 2021, upon approval by the Compensation Committee of the Company’s Board of Directors, certain terms of the performance-based stock option award agreements were modified. Pursuant to ASC 718, the Company determined the modification to be a Type IV (improbable-to-improbable) modification and revalued the modified awards as of the modification date. Upon assessment of the performance-based stock option awards as of December 31, 2021, the Company determined the first performance goal to be probable of vesting and, as such, recorded $2.6 million of stock-based compensation expense for the year ended December 31, 2021. The fair value of the performance-based options that could be expensed in future periods is $7.8 million.

A summary of restricted stock and restricted stock unit activity under the option plans for 2021 is presented below (in thousands, except weighted-average data):


	Number of	Weighted-
	Restricted	Average Grant
	Stock Shares	Date Fair Value
Unvested at December 31, 2020	61	$	2.47
Granted	75		5.68
Vested	(2)		2.53
Forfeited	(57)		2.47
Unvested at December 31, 2021	77	$	5.59

In June 2018, the Company's Board of Directors, with shareholder approval, adopted the Employee Stock Purchase Plan. Following the automatic share increase on January 1, 2021 under the ESPP’s “evergreen” provision, an aggregate of 2,000,000 shares of common stock have been reserved for issuance under the ESPP. Under the ESPP, eligible participants purchase shares of the Company's common stock at a price equal to 85% of the lesser of the closing price of the Company's common stock on the first business day and the final business day of the applicable plan purchase period. Plan purchase periods are six months and begin on January 1 and July 1 of each year, with purchase dates occurring on the final business day of the given purchase period. The fair value of each ESPP award is estimated on the first day of the offering period using the Black-Scholes option-pricing model. The Company recognizes share-based compensation expense equal to the fair value of the ESPP awards on a straight-line basis over the offering period.

During 2021, 2020, and 2019, approximately 126,000, 122,000, and 356,000 shares, respectively, were issued to participating employees at fair values ranging from $1.20 to $2.29 per share.

Stock compensation expense related to stock options and restricted stock awards granted under the option plans and the ESPP was $16.8 million, $14.0 million, and $13.8 million during the years ended December 31, 2021, 2020, and 2019, respectively. As of December 31, 2021, the estimated fair value of unvested employee awards was $28.6 million. The weighted-average remaining vesting period for these awards is 2.9 years. Also included in stock and deferred stock unit compensation expense in the consolidated statements of cash flows for the years ended December 31, 2021, 2020, and 2019 is $0.7 million, $0.4 million, and $0.3 million, respectively, of expense recorded for directors’ deferred share units, the details of which are discussed in Note H.

A summary of option activity for options vested during the years ended December 31, 2021, 2020, and 2019 is presented below (in thousands):


	Year Ended December 31,
	2021		2020		2019
Total fair value of options vested	$	15,839	$	11,465	$	13,747
Total intrinsic value of options exercised		3,322		746		556
Cash received from the exercise of stock options and ESPP purchases		3,769		1,471		2,873

Comprehensive Loss

The Company presents comprehensive loss in accordance with ASC 220, Comprehensive Income. Comprehensive loss is comprised of the Company’s net loss for all periods presented.

Segment Information

The percentages of revenues recognized from significant customers of the Company in the years ended December 31, 2021, 2020, and 2019 are included in the following table:


	Year Ended December 31,
Collaborative Partner:	2021	2020	2019
Roche	67%	53%	64%
Huadong	24%	-%	-%
Jazz	-%	46%	18%
CytomX	-%	-%	13%

There were no other customers of the Company with significant revenues in the periods presented.

Recently Adopted Accounting Pronouncements

No other recently issued or effective ASUs had, or are expected to have, a material effect on the Company's results of operations, financial condition, or liquidity.

Employee Benefit Plans (Details) - USD ($) $ in Millions	12 Months Ended
Employee Benefit Plans (Details) - USD ($) $ in Millions	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Employee Benefit Plans
Maximum employees' contribution (as a percent)	100.00%
Matching contribution of first 6% of eligible employees' contributions (as a percent)	50.00%
Percentage of eligible employees' contributions matched by the company	6.00%
Company's contribution	$ 0.5	$ 0.4	$ 0.8

Leases

12 Months Ended

Dec. 31, 2021

Leases

Leases

J.Leases

Leases

The Company currently has one real estate lease with CRP/King 830 Winter L.L.C. for the rental of approximately 120,000 square feet of laboratory and office space at 830 Winter Street, Waltham, Massachusetts through March 2026. The Company uses this space for its corporate headquarters and other operations. The Company may extend the lease for two additional terms of five years and is required to pay certain operating expenses for the leased premises subject to escalation charges for certain expense increases over a base amount. During 2020, the Company executed four subleases for approximately 65,000 square feet through the remaining initial term of the lease. The balance of the space will be used by the Company.

In addition to the real estate lease noted above, the Company currently has a lease agreement through March 2027 for the rental of copier equipment.

Upon adoption of ASC 842, Leases, in 2019, a ROU asset of $17.6 million and a lease liability of $27.3 million were recorded and are identified separately in the Company’s consolidated balance sheets for the existing operating leases. There was no impact to the consolidated statements of operations. Upon adoption, the amount of the ROU assets recorded was offset by the applicable unamortized lease incentive and straight-line lease liability balances of $9.7 million and, therefore, there was no impact to accumulated deficit. There were no initial direct costs related to the leases to consider. The Company’s operating lease liabilities related to its real estate lease agreements were calculated using a collateralized incremental borrowing rate. The weighted average discount rate for the operating lease liability is approximately 11%. A 100-basis point change in the incremental borrowing rate would result in less than a $1 million impact to the ROU assets and liabilities recorded. Lease expense for operating lease payments is recognized on a straight-line basis over the lease term, which for the years ended December 31, 2021, 2020, and 2019 was $4.0 million, $4.0 million, and $4.3 million, respectively, and is included in operating expenses in the consolidated income statements.

During 2019, the Company recorded $0.6 million of impairment charges related to its 930 Winter Street lease, which represents the remaining balance of the right to use asset as the likelihood of finding a sub-lessor has diminished significantly as the lease approaches termination. Cash paid against operating lease liabilities during the years ended December 31, 2021 and 2020 was $5.3 million and $5.5 million, respectively. As of December 31, 2021, the Company’s ROU assets and lease liabilities for operating leases totaled $12.4 million and $18.8 million, respectively, and the weighted average remaining term of the operating leases is approximately 4.25 years.

The maturities of operating lease liabilities discussed above are as follows (in thousands):


2022	$	5,363
2023		5,503
2024		5,522
2025		5,543
2026		1,429
Thereafter		13
Total lease payments		23,373
Less imputed interest		(4,592)
Total lease liabilities	$	18,781

In addition to the amounts in the table above, the Company is also responsible for variable operating costs and real estate taxes approximating $3.4 million per year through March 2026.

Sublease Income

In 2020, the Company executed four agreements to sublease a total of approximately 65,000 square feet of the Company’s leased space at 830 Winter Street, Waltham, Massachusetts through March 2026. During the years ended December 31, 2021 and 2020, the Company recorded $4.9 million and $2.8 million of sublease income, respectively, inclusive of the sublessees’ proportionate share of operating expenses and real estate taxes for the period.

Two of the four sublease agreements include an early termination option after certain periods of time for an agreed-upon fee. Assuming no early termination option is exercised, the Company will receive $13.3 million in minimum rental payments over the remaining term of the subleases, which is not included in the operating lease liability table above. The sublessees are also responsible for their proportionate share of variable operating expenses and real estate taxes.