|
|
☒
|
Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
|
☐
|
Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
|
Ireland
|
98-1032470
|
(State or other jurisdiction of
incorporation or organization)
|
(I.R.S. Employer
Identification No.)
|
|
Title of each class
|
Trading Symbol(s)
|
Name of each exchange on which registered
|
Ordinary shares, nominal value $0.0001 per share
|
JAZZ
|
The Nasdaq Stock Market LLC
|
Large accelerated filer
|
☒
|
|
Accelerated filer
|
☐
|
|
|
|
|
|
Non-accelerated filer
|
☐
|
|
Smaller reporting company
|
☐
|
|
|
|
|
|
Emerging growth company
|
☐
|
|
|
|
|
|
Page
|
|
||
|
|
|
Item 1.
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
|
|
Item 2.
|
||
|
|
|
Item 3.
|
||
|
|
|
Item 4.
|
||
|
|
|
|
||
|
|
|
Item 1A.
|
||
|
|
|
Item 2.
|
||
|
|
|
Item 6.
|
||
|
|
|
Item 1.
|
Financial Statements
|
|
March 31,
2020 |
|
December 31,
2019 |
||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
701,602
|
|
|
$
|
637,344
|
|
Investments
|
280,000
|
|
|
440,000
|
|
||
Accounts receivable, net of allowances
|
317,301
|
|
|
355,987
|
|
||
Inventories
|
85,610
|
|
|
78,608
|
|
||
Prepaid expenses
|
38,824
|
|
|
39,434
|
|
||
Other current assets
|
94,300
|
|
|
78,895
|
|
||
Total current assets
|
1,517,637
|
|
|
1,630,268
|
|
||
Property, plant and equipment, net
|
129,562
|
|
|
131,506
|
|
||
Operating lease assets
|
135,976
|
|
|
139,385
|
|
||
Intangible assets, net
|
2,238,658
|
|
|
2,440,977
|
|
||
Goodwill
|
909,226
|
|
|
920,018
|
|
||
Deferred tax assets, net
|
230,242
|
|
|
221,403
|
|
||
Deferred financing costs
|
6,887
|
|
|
7,426
|
|
||
Other non-current assets
|
47,107
|
|
|
47,914
|
|
||
Total assets
|
$
|
5,215,295
|
|
|
$
|
5,538,897
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
66,308
|
|
|
$
|
47,545
|
|
Accrued liabilities
|
261,041
|
|
|
267,873
|
|
||
Current portion of long-term debt
|
33,387
|
|
|
33,387
|
|
||
Income taxes payable
|
31,211
|
|
|
10,965
|
|
||
Deferred revenue
|
4,176
|
|
|
4,720
|
|
||
Total current liabilities
|
396,123
|
|
|
364,490
|
|
||
Deferred revenue, non-current
|
4,225
|
|
|
4,861
|
|
||
Long-term debt, less current portion
|
1,576,984
|
|
|
1,573,870
|
|
||
Operating lease liabilities, less current portion
|
147,110
|
|
|
151,226
|
|
||
Deferred tax liabilities, net
|
165,095
|
|
|
224,095
|
|
||
Other non-current liabilities
|
117,258
|
|
|
109,374
|
|
||
Commitments and contingencies (Note 11)
|
|
|
|
|
|||
Shareholders’ equity:
|
|
|
|
||||
Ordinary shares
|
6
|
|
|
6
|
|
||
Non-voting euro deferred shares
|
55
|
|
|
55
|
|
||
Capital redemption reserve
|
472
|
|
|
472
|
|
||
Additional paid-in capital
|
2,294,474
|
|
|
2,266,026
|
|
||
Accumulated other comprehensive loss
|
(257,436
|
)
|
|
(223,393
|
)
|
||
Retained earnings
|
770,929
|
|
|
1,067,815
|
|
||
Total shareholders’ equity
|
2,808,500
|
|
|
3,110,981
|
|
||
Total liabilities and shareholders’ equity
|
$
|
5,215,295
|
|
|
$
|
5,538,897
|
|
|
Three Months Ended
March 31, |
||||||
|
2020
|
|
2019
|
||||
Revenues:
|
|
|
|
||||
Product sales, net
|
$
|
530,205
|
|
|
$
|
503,331
|
|
Royalties and contract revenues
|
4,521
|
|
|
4,855
|
|
||
Total revenues
|
534,726
|
|
|
508,186
|
|
||
Operating expenses:
|
|
|
|
||||
Cost of product sales (excluding amortization of acquired developed technologies)
|
28,657
|
|
|
33,506
|
|
||
Selling, general and administrative
|
208,400
|
|
|
167,947
|
|
||
Research and development
|
86,107
|
|
|
60,105
|
|
||
Intangible asset amortization
|
62,847
|
|
|
56,885
|
|
||
Acquired in-process research and development
|
202,250
|
|
|
56,000
|
|
||
Impairment charge
|
136,139
|
|
|
—
|
|
||
Total operating expenses
|
724,400
|
|
|
374,443
|
|
||
Income (loss) from operations
|
(189,674
|
)
|
|
133,743
|
|
||
Interest expense, net
|
(18,496
|
)
|
|
(17,922
|
)
|
||
Foreign exchange loss
|
(1,132
|
)
|
|
(611
|
)
|
||
Income (loss) before income tax provision (benefit) and equity in loss (gain) of investees
|
(209,302
|
)
|
|
115,210
|
|
||
Income tax provision (benefit)
|
(51,287
|
)
|
|
29,116
|
|
||
Equity in loss (gain) of investees
|
(182
|
)
|
|
893
|
|
||
Net income (loss)
|
$
|
(157,833
|
)
|
|
$
|
85,201
|
|
|
|
|
|
||||
Net income (loss) per ordinary share:
|
|
|
|
||||
Basic
|
$
|
(2.82
|
)
|
|
$
|
1.49
|
|
Diluted
|
$
|
(2.82
|
)
|
|
$
|
1.47
|
|
Weighted-average ordinary shares used in per share calculations - basic
|
55,956
|
|
|
57,206
|
|
||
Weighted-average ordinary shares used in per share calculations - diluted
|
55,956
|
|
|
58,081
|
|
|
Three Months Ended
March 31, |
||||||
|
2020
|
|
2019
|
||||
Net income (loss)
|
$
|
(157,833
|
)
|
|
$
|
85,201
|
|
Other comprehensive income (loss):
|
|
|
|
||||
Foreign currency translation adjustments
|
(29,990
|
)
|
|
(21,142
|
)
|
||
Unrealized loss on hedging activities, net of income tax benefit of $579 and $249, respectively
|
(4,053
|
)
|
|
(1,741
|
)
|
||
Other comprehensive income (loss)
|
(34,043
|
)
|
|
(22,883
|
)
|
||
Total comprehensive income (loss)
|
$
|
(191,876
|
)
|
|
$
|
62,318
|
|
|
Ordinary Shares
|
|
Non-voting Euro Deferred
|
|
Capital Redemption Reserve
|
|
Additional
Paid-in
Capital
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Retained Earnings
|
|
Total
Equity
|
||||||||||||||||||||
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
|
|||||||||||||||||||||||||
Balance at December 31, 2019
|
56,140
|
|
|
$
|
6
|
|
|
4,000
|
|
|
$
|
55
|
|
|
$
|
472
|
|
|
$
|
2,266,026
|
|
|
$
|
(223,393
|
)
|
|
$
|
1,067,815
|
|
|
$
|
3,110,981
|
|
Issuance of ordinary shares in conjunction with exercise of share options
|
145
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13,264
|
|
|
—
|
|
|
—
|
|
|
13,264
|
|
|||||||
Issuance of ordinary shares in conjunction with vesting of restricted stock units
|
214
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Shares withheld for payment of employee's withholding tax liability
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(13,547
|
)
|
|
—
|
|
|
—
|
|
|
(13,547
|
)
|
|||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
28,731
|
|
|
—
|
|
|
—
|
|
|
28,731
|
|
|||||||
Shares repurchased
|
(1,131
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(139,053
|
)
|
|
(139,053
|
)
|
|||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(34,043
|
)
|
|
—
|
|
|
(34,043
|
)
|
|||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(157,833
|
)
|
|
(157,833
|
)
|
|||||||
Balance at March 31, 2020
|
55,368
|
|
|
$
|
6
|
|
|
4,000
|
|
|
$
|
55
|
|
|
$
|
472
|
|
|
$
|
2,294,474
|
|
|
$
|
(257,436
|
)
|
|
$
|
770,929
|
|
|
$
|
2,808,500
|
|
|
Ordinary Shares
|
|
Non-voting Euro Deferred
|
|
Capital Redemption Reserve
|
|
Additional
Paid-in
Capital
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Retained Earnings
|
|
Total
Equity
|
||||||||||||||||||||
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
|
|||||||||||||||||||||||||
Balance at December 31, 2018
|
57,504
|
|
|
$
|
6
|
|
|
4,000
|
|
|
$
|
55
|
|
|
$
|
472
|
|
|
$
|
2,113,630
|
|
|
$
|
(197,791
|
)
|
|
$
|
841,050
|
|
|
$
|
2,757,422
|
|
Cumulative effect adjustment from adoption of new accounting standards
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,848
|
|
|
4,848
|
|
|||||||
Issuance of ordinary shares in conjunction with exercise of share options
|
54
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,057
|
|
|
—
|
|
|
—
|
|
|
3,057
|
|
|||||||
Issuance of ordinary shares in conjunction with vesting of restricted stock units
|
203
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Shares withheld for payment of employee's withholding tax liability
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(13,810
|
)
|
|
—
|
|
|
—
|
|
|
(13,810
|
)
|
|||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
27,861
|
|
|
—
|
|
|
—
|
|
|
27,861
|
|
|||||||
Shares repurchased
|
(858
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(111,249
|
)
|
|
(111,249
|
)
|
|||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(22,883
|
)
|
|
—
|
|
|
(22,883
|
)
|
|||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
85,201
|
|
|
85,201
|
|
|||||||
Balance at March 31, 2019
|
56,903
|
|
|
$
|
6
|
|
|
4,000
|
|
|
$
|
55
|
|
|
$
|
472
|
|
|
$
|
2,130,738
|
|
|
$
|
(220,674
|
)
|
|
$
|
819,850
|
|
|
$
|
2,730,447
|
|
|
Three Months Ended
March 31, |
||||||
|
2020
|
|
2019
|
||||
Operating activities
|
|
|
|
||||
Net income (loss)
|
$
|
(157,833
|
)
|
|
$
|
85,201
|
|
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
|
|
|
|
||||
Intangible asset amortization
|
62,847
|
|
|
56,885
|
|
||
Share-based compensation
|
28,654
|
|
|
27,552
|
|
||
Impairment charge
|
136,139
|
|
|
—
|
|
||
Depreciation
|
4,527
|
|
|
3,539
|
|
||
Acquired in-process research and development
|
202,250
|
|
|
56,000
|
|
||
Loss on disposal of assets
|
73
|
|
|
3
|
|
||
Deferred tax benefit
|
(63,976
|
)
|
|
(17,053
|
)
|
||
Provision for losses on accounts receivable and inventory
|
2,620
|
|
|
528
|
|
||
Amortization of debt discount and deferred financing costs
|
12,000
|
|
|
11,133
|
|
||
Other non-cash transactions
|
1,902
|
|
|
(738
|
)
|
||
Changes in assets and liabilities:
|
|
|
|
||||
Accounts receivable
|
37,861
|
|
|
(56,960
|
)
|
||
Inventories
|
(10,235
|
)
|
|
(8,688
|
)
|
||
Prepaid expenses and other current assets
|
(17,843
|
)
|
|
(988
|
)
|
||
Other non-current assets
|
323
|
|
|
426
|
|
||
Operating lease assets
|
3,195
|
|
|
2,108
|
|
||
Accounts payable
|
19,604
|
|
|
1,554
|
|
||
Accrued liabilities
|
(12,198
|
)
|
|
(3,730
|
)
|
||
Income taxes payable
|
20,829
|
|
|
39,726
|
|
||
Deferred revenue
|
(1,180
|
)
|
|
(1,874
|
)
|
||
Other non-current liabilities
|
7,316
|
|
|
6,773
|
|
||
Operating lease liabilities, less current portion
|
(3,906
|
)
|
|
856
|
|
||
Net cash provided by operating activities
|
272,969
|
|
|
202,253
|
|
||
Investing activities
|
|
|
|
||||
Proceeds from maturity of investments
|
345,000
|
|
|
345,000
|
|
||
Purchases of property, plant and equipment
|
(4,830
|
)
|
|
(7,948
|
)
|
||
Acquired in-process research and development
|
(202,250
|
)
|
|
(56,000
|
)
|
||
Acquisition of intangible assets
|
(13,000
|
)
|
|
—
|
|
||
Acquisition of investments
|
(185,000
|
)
|
|
(115,000
|
)
|
||
Net cash (used in) provided by investing activities
|
(60,080
|
)
|
|
166,052
|
|
||
Financing activities
|
|
|
|
||||
Proceeds from employee equity incentive and purchase plans
|
13,264
|
|
|
3,057
|
|
||
Payment of employee withholding taxes related to share-based awards
|
(13,547
|
)
|
|
(13,810
|
)
|
||
Repayments of long-term debt
|
(8,347
|
)
|
|
(8,347
|
)
|
||
Share repurchases
|
(139,053
|
)
|
|
(111,249
|
)
|
||
Net cash used in financing activities
|
(147,683
|
)
|
|
(130,349
|
)
|
||
Effect of exchange rates on cash and cash equivalents
|
(948
|
)
|
|
(112
|
)
|
||
Net increase in cash and cash equivalents
|
64,258
|
|
|
237,844
|
|
||
Cash and cash equivalents, at beginning of period
|
637,344
|
|
|
309,622
|
|
||
Cash and cash equivalents, at end of period
|
$
|
701,602
|
|
|
$
|
547,466
|
|
•
|
Xyrem® (sodium oxybate) oral solution, the only product approved by the U.S. Food and Drug Administration, or FDA, and marketed in the U.S. for the treatment of both cataplexy and excessive daytime sleepiness, or EDS, in both adult and pediatric patients with narcolepsy;
|
•
|
Sunosi® (solriamfetol), a product approved by FDA and marketed in the U.S. to improve wakefulness in adult patients with EDS associated with narcolepsy or obstructive sleep apnea, and also recently approved in Europe in January 2020 by the European Commission;
|
•
|
Defitelio® (defibrotide sodium), a product approved in the U.S. for the treatment of adult and pediatric patients with hepatic veno-occlusive disease, or VOD, also known as sinusoidal obstruction syndrome, with renal or pulmonary dysfunction following hematopoietic stem cell transplantation, or HSCT, and in Europe (where it is marketed as Defitelio® (defibrotide)) for the treatment of severe VOD in adults and children undergoing HSCT therapy;
|
•
|
Erwinaze® (asparaginase Erwinia chrysanthemi), a treatment approved in the U.S. and in certain markets in Europe (where it is marketed as Erwinase®) for patients with acute lymphoblastic leukemia, or ALL, who have developed hypersensitivity to E. coli-derived asparaginase; and
|
•
|
Vyxeos® (daunorubicin and cytarabine) liposome for injection, a product approved in the U.S. and in Europe (where it is marketed as Vyxeos® liposomal 44 mg/100 mg powder for concentrate for solution for infusion) for the treatment of adults with newly-diagnosed therapy-related acute myeloid leukemia, or AML, or AML with myelodysplasia-related changes.
|
•
|
Strong financial execution through growth in sales of our current lead marketed products;
|
•
|
Building a diversified product portfolio and development pipeline through a combination of our internal research and development efforts and obtaining rights to clinically meaningful and differentiated on- or near-market products and early- to late-stage product candidates through corporate development transactions; and
|
•
|
Maximizing the value of our products and product candidates by continuing to implement our comprehensive global development plans, including through generating additional clinical data and seeking regulatory approval for new indications and new geographies.
|
|
March 31, 2020
|
||||||||||||||||||||||
|
Amortized
Cost
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
|
|
Estimated
Fair Value
|
|
Cash and
Cash
Equivalents
|
|
Investments
|
||||||||||||
Cash
|
$
|
226,349
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
226,349
|
|
|
$
|
226,349
|
|
|
$
|
—
|
|
Time deposits
|
630,000
|
|
|
—
|
|
|
—
|
|
|
630,000
|
|
|
350,000
|
|
|
280,000
|
|
||||||
Money market funds
|
125,253
|
|
|
—
|
|
|
—
|
|
|
125,253
|
|
|
125,253
|
|
|
—
|
|
||||||
Totals
|
$
|
981,602
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
981,602
|
|
|
$
|
701,602
|
|
|
$
|
280,000
|
|
|
December 31, 2019
|
||||||||||||||||||||||
|
Amortized
Cost |
|
Gross
Unrealized Gains |
|
Gross
Unrealized Losses |
|
Estimated
Fair Value |
|
Cash and
Cash Equivalents |
|
Investments
|
||||||||||||
Cash
|
$
|
333,172
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
333,172
|
|
|
$
|
333,172
|
|
|
$
|
—
|
|
Time deposits
|
460,000
|
|
|
—
|
|
|
—
|
|
|
460,000
|
|
|
20,000
|
|
|
440,000
|
|
||||||
Money market funds
|
284,172
|
|
|
—
|
|
|
—
|
|
|
284,172
|
|
|
284,172
|
|
|
—
|
|
||||||
Totals
|
$
|
1,077,344
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,077,344
|
|
|
$
|
637,344
|
|
|
$
|
440,000
|
|
|
March 31, 2020
|
|
December 31, 2019
|
||||||||||||||||||||
|
Quoted
Prices in Active Markets for Identical Assets (Level 1) |
|
Significant
Other Observable Inputs (Level 2) |
|
Total
Estimated Fair Value |
|
Quoted
Prices in Active Markets for Identical Assets (Level 1) |
|
Significant
Other Observable Inputs (Level 2) |
|
Total
Estimated Fair Value |
||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Available-for-sale securities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Time deposits
|
$
|
—
|
|
|
$
|
630,000
|
|
|
$
|
630,000
|
|
|
$
|
—
|
|
|
$
|
460,000
|
|
|
$
|
460,000
|
|
Money market funds
|
125,253
|
|
|
—
|
|
|
125,253
|
|
|
284,172
|
|
|
—
|
|
|
284,172
|
|
||||||
Foreign exchange forward contracts
|
—
|
|
|
316
|
|
|
316
|
|
|
—
|
|
|
2,508
|
|
|
2,508
|
|
||||||
Totals
|
$
|
125,253
|
|
|
$
|
630,316
|
|
|
$
|
755,569
|
|
|
$
|
284,172
|
|
|
$
|
462,508
|
|
|
$
|
746,680
|
|
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest rate contracts
|
$
|
—
|
|
|
$
|
6,155
|
|
|
$
|
6,155
|
|
|
$
|
—
|
|
|
$
|
1,515
|
|
|
$
|
1,515
|
|
Foreign exchange forward contracts
|
—
|
|
|
3,955
|
|
|
3,955
|
|
|
—
|
|
|
182
|
|
|
182
|
|
||||||
Totals
|
$
|
—
|
|
|
$
|
10,110
|
|
|
$
|
10,110
|
|
|
$
|
—
|
|
|
$
|
1,697
|
|
|
$
|
1,697
|
|
|
Three Months Ended
March 31, |
||||||
Interest Rate Contracts:
|
2020
|
|
2019
|
||||
Loss recognized in accumulated other comprehensive loss, net of tax
|
$
|
(4,200
|
)
|
|
$
|
(1,341
|
)
|
Loss (gain) reclassified from accumulated other comprehensive loss to interest expense, net of tax
|
147
|
|
|
(400
|
)
|
|
Three Months Ended
March 31, |
||||||
Foreign Exchange Forward Contracts:
|
2020
|
|
2019
|
||||
Loss recognized in foreign exchange loss
|
$
|
(6,139
|
)
|
|
$
|
(3,409
|
)
|
|
March 31, 2020
|
||||||||||
|
Asset Derivatives
|
|
Liability Derivatives
|
||||||||
|
Balance Sheet Location
|
|
Fair Value
|
|
Balance Sheet Location
|
|
Fair Value
|
||||
Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
||||
Interest rate contracts
|
Other current assets
|
|
$
|
—
|
|
|
Accrued liabilities
|
|
$
|
4,708
|
|
|
|
|
|
|
Other non-current liabilities
|
|
1,447
|
|
|||
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
|
|
||||
Foreign exchange forward contracts
|
Other current assets
|
|
316
|
|
|
Accrued liabilities
|
|
3,955
|
|
||
Total fair value of derivative instruments
|
|
|
$
|
316
|
|
|
|
|
$
|
10,110
|
|
|
December 31, 2019
|
||||||||||
|
Asset Derivatives
|
|
Liability Derivatives
|
||||||||
|
Balance Sheet Location
|
|
Fair Value
|
|
Balance Sheet Location
|
|
Fair Value
|
||||
Derivatives designated as hedging instruments:
|
|
|
|
|
|
|
|
||||
Interest rate contracts
|
Other current assets
|
|
$
|
—
|
|
|
Accrued liabilities
|
|
$
|
855
|
|
|
|
|
|
|
Other non-current liabilities
|
|
660
|
|
|||
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
|
|
||||
Foreign exchange forward contracts
|
Other current assets
|
|
2,508
|
|
|
Accrued liabilities
|
|
182
|
|
||
Total fair value of derivative instruments
|
|
|
$
|
2,508
|
|
|
|
|
$
|
1,697
|
|
|
March 31, 2020
|
||||||||||||||||||||||
|
Gross Amounts of Recognized Assets/ Liabilities
|
|
Gross Amounts Offset in the Consolidated Balance Sheet
|
|
Net Amounts of Assets/ Liabilities Presented in the Consolidated Balance Sheet
|
|
Gross Amounts Not Offset in the Consolidated Balance Sheet
|
||||||||||||||||
Description
|
|
|
|
Derivative Financial Instruments
|
|
Cash Collateral Received (Pledged)
|
|
Net Amount
|
|||||||||||||||
Derivative assets
|
$
|
316
|
|
|
$
|
—
|
|
|
$
|
316
|
|
|
$
|
(316
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
Derivative liabilities
|
(10,110
|
)
|
|
—
|
|
|
(10,110
|
)
|
|
316
|
|
|
—
|
|
|
(9,794
|
)
|
|
December 31, 2019
|
||||||||||||||||||||||
|
Gross Amounts of Recognized Assets/ Liabilities
|
|
Gross Amounts Offset in the Consolidated Balance Sheet
|
|
Net Amounts of Assets/ Liabilities Presented in the Consolidated Balance Sheet
|
|
Gross Amounts Not Offset in the Consolidated Balance Sheet
|
||||||||||||||||
Description
|
|
|
|
Derivative Financial Instruments
|
|
Cash Collateral Received (Pledged)
|
|
Net Amount
|
|||||||||||||||
Derivative assets
|
$
|
2,508
|
|
|
$
|
—
|
|
|
$
|
2,508
|
|
|
$
|
(596
|
)
|
|
$
|
—
|
|
|
$
|
1,912
|
|
Derivative liabilities
|
(1,697
|
)
|
|
—
|
|
|
(1,697
|
)
|
|
596
|
|
|
—
|
|
|
(1,101
|
)
|
|
March 31,
2020 |
|
December 31,
2019 |
||||
Raw materials
|
$
|
13,901
|
|
|
$
|
13,595
|
|
Work in process
|
37,689
|
|
|
36,658
|
|
||
Finished goods
|
34,020
|
|
|
28,355
|
|
||
Total inventories
|
$
|
85,610
|
|
|
$
|
78,608
|
|
Balance at December 31, 2019
|
$
|
920,018
|
|
Foreign exchange
|
(10,792
|
)
|
|
Balance at March 31, 2020
|
$
|
909,226
|
|
|
March 31, 2020
|
|
December 31, 2019
|
||||||||||||||||||||||
|
Remaining
Weighted- Average Useful Life (In years) |
|
Gross
Carrying Amount |
|
Accumulated
Amortization |
|
Net Book
Value |
|
Gross
Carrying Amount |
|
Accumulated
Amortization |
|
Net Book
Value |
||||||||||||
Acquired developed technologies
|
13.2
|
|
$
|
3,152,634
|
|
|
$
|
(913,976
|
)
|
|
$
|
2,238,658
|
|
|
$
|
3,166,485
|
|
|
$
|
(864,834
|
)
|
|
$
|
2,301,651
|
|
Manufacturing contracts
|
—
|
|
11,728
|
|
|
(11,728
|
)
|
|
—
|
|
|
12,025
|
|
|
(12,025
|
)
|
|
—
|
|
||||||
Trademarks
|
—
|
|
2,883
|
|
|
(2,883
|
)
|
|
—
|
|
|
2,890
|
|
|
(2,890
|
)
|
|
—
|
|
||||||
Priority review voucher
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
111,101
|
|
|
(111,101
|
)
|
|
—
|
|
||||||
Total finite-lived intangible assets
|
|
|
3,167,245
|
|
|
(928,587
|
)
|
|
2,238,658
|
|
|
3,292,501
|
|
|
(990,850
|
)
|
|
2,301,651
|
|
||||||
Acquired IPR&D assets
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
139,326
|
|
|
—
|
|
|
139,326
|
|
||||||
Total intangible assets
|
|
|
$
|
3,167,245
|
|
|
$
|
(928,587
|
)
|
|
$
|
2,238,658
|
|
|
$
|
3,431,827
|
|
|
$
|
(990,850
|
)
|
|
$
|
2,440,977
|
|
Year Ending December 31,
|
Estimated
Amortization
Expense
|
||
2020 (remainder)
|
$
|
186,372
|
|
2021
|
203,041
|
|
|
2022
|
159,167
|
|
|
2023
|
159,167
|
|
|
2024
|
159,167
|
|
|
Thereafter
|
1,371,744
|
|
|
Total
|
$
|
2,238,658
|
|
|
March 31,
2020 |
|
December 31,
2019 |
||||
Leasehold improvements
|
$
|
52,275
|
|
|
$
|
52,294
|
|
Land and buildings
|
47,040
|
|
|
47,053
|
|
||
Manufacturing equipment and machinery
|
29,961
|
|
|
28,860
|
|
||
Computer software
|
23,044
|
|
|
25,680
|
|
||
Computer equipment
|
16,932
|
|
|
16,577
|
|
||
Furniture and fixtures
|
11,281
|
|
|
11,152
|
|
||
Construction-in-progress
|
4,472
|
|
|
5,147
|
|
||
Subtotal
|
185,005
|
|
|
186,763
|
|
||
Less accumulated depreciation and amortization
|
(55,443
|
)
|
|
(55,257
|
)
|
||
Property, plant and equipment, net
|
$
|
129,562
|
|
|
$
|
131,506
|
|
|
March 31,
2020 |
|
December 31,
2019 |
||||
Rebates and other sales deductions
|
$
|
121,369
|
|
|
$
|
96,860
|
|
Employee compensation and benefits
|
52,080
|
|
|
80,290
|
|
||
Current portion of operating lease liabilities
|
12,357
|
|
|
12,728
|
|
||
Derivative instrument liabilities
|
8,663
|
|
|
1,037
|
|
||
Selling and marketing accruals
|
8,443
|
|
|
11,299
|
|
||
Inventory-related accruals
|
7,706
|
|
|
7,816
|
|
||
Sales returns reserve
|
4,519
|
|
|
3,462
|
|
||
Accrued collaboration expenses
|
3,865
|
|
|
2,494
|
|
||
Professional fees
|
3,495
|
|
|
4,718
|
|
||
Royalties
|
2,654
|
|
|
6,931
|
|
||
Accrued interest
|
2,520
|
|
|
7,386
|
|
||
Clinical trial accruals
|
2,473
|
|
|
2,551
|
|
||
Accrued construction-in-progress
|
256
|
|
|
1,564
|
|
||
Other
|
30,641
|
|
|
28,737
|
|
||
Total accrued liabilities
|
$
|
261,041
|
|
|
$
|
267,873
|
|
|
March 31,
2020 |
|
December 31,
2019 |
||||
2021 Notes
|
$
|
575,000
|
|
|
$
|
575,000
|
|
Unamortized discount and debt issuance costs on 2021 Notes
|
(33,152
|
)
|
|
(38,865
|
)
|
||
2021 Notes, net
|
541,848
|
|
|
536,135
|
|
||
|
|
|
|
||||
2024 Notes
|
575,000
|
|
|
575,000
|
|
||
Unamortized discount and debt issuance costs on 2024 Notes
|
(112,389
|
)
|
|
(117,859
|
)
|
||
2024 Notes, net
|
462,611
|
|
|
457,141
|
|
||
|
|
|
|
||||
Term loan
|
605,912
|
|
|
613,981
|
|
||
Total debt
|
1,610,371
|
|
|
1,607,257
|
|
||
Less current portion
|
33,387
|
|
|
33,387
|
|
||
Total long-term debt
|
$
|
1,576,984
|
|
|
$
|
1,573,870
|
|
Year Ending December 31,
|
Scheduled Long-Term Debt Maturities
|
||
2020 (remainder)
|
$
|
25,040
|
|
2021
|
608,387
|
|
|
2022
|
33,387
|
|
|
2023
|
517,494
|
|
|
2024
|
575,000
|
|
|
Total
|
$
|
1,759,308
|
|
|
Three Months Ended
March 31, |
||||||
Lease Cost
|
2020
|
|
2019
|
||||
Operating lease cost
|
$
|
5,290
|
|
|
$
|
5,870
|
|
Short-term lease cost
|
870
|
|
|
601
|
|
||
Variable lease cost
|
1
|
|
|
3
|
|
||
Sublease income
|
(157
|
)
|
|
(162
|
)
|
||
Net lease cost
|
$
|
6,004
|
|
|
$
|
6,312
|
|
Leases
|
Classification
|
March 31,
2020 |
|
December 31,
2019 |
||||
Assets
|
|
|
|
|
||||
Operating lease assets
|
Operating lease assets
|
$
|
135,976
|
|
|
$
|
139,385
|
|
|
|
|
|
|
||||
Liabilities
|
|
|
|
|
||||
Current
|
|
|
|
|
||||
Operating lease liabilities
|
Accrued liabilities
|
12,357
|
|
|
12,728
|
|
||
Non-current
|
|
|
|
|
||||
Operating lease liabilities
|
Operating lease liabilities, less current portion
|
147,110
|
|
|
151,226
|
|
||
Total operating lease liabilities
|
|
$
|
159,467
|
|
|
$
|
163,954
|
|
Lease Term and Discount Rate
|
March 31,
2020 |
|
December 31,
2019 |
||
Weighted-average remaining lease term - operating leases (years)
|
9.6
|
|
|
9.7
|
|
Weighted-average discount rate - operating leases
|
5.3
|
%
|
|
5.3
|
%
|
|
Three Months Ended
March 31, |
||||||
|
2020
|
|
2019
|
||||
Cash paid for amounts included in the measurement of lease liabilities:
|
|
|
|
||||
Operating cash outflows from operating leases
|
$
|
6,215
|
|
|
$
|
4,576
|
|
Non-cash operating activities:
|
|
|
|
||||
Right-of-use assets obtained in exchange for new operating lease liabilities (1)
|
$
|
201
|
|
|
$
|
151,029
|
|
(1)
|
The March 31, 2019 disclosure includes the balances recognized on January 1, 2019 on adoption of ASU No. 2016-02, Leases.
|
Year Ending December 31,
|
Operating leases
|
||
2020 (remainder)
|
$
|
15,097
|
|
2021
|
21,023
|
|
|
2022
|
21,044
|
|
|
2023
|
21,368
|
|
|
2024
|
23,711
|
|
|
Thereafter
|
104,655
|
|
|
Total lease payments
|
$
|
206,898
|
|
Less imputed interest
|
(47,431
|
)
|
|
Present value of lease liabilities
|
$
|
159,467
|
|
|
Net Unrealized
Gain (Loss) From Hedging Activities |
|
Foreign
Currency Translation Adjustments |
|
Total
Accumulated Other Comprehensive Loss |
||||||
Balance at December 31, 2019
|
$
|
(1,325
|
)
|
|
$
|
(222,068
|
)
|
|
$
|
(223,393
|
)
|
Other comprehensive loss before reclassifications
|
(4,200
|
)
|
|
(29,990
|
)
|
|
(34,190
|
)
|
|||
Amounts reclassified from accumulated other comprehensive loss
|
147
|
|
|
—
|
|
|
147
|
|
|||
Other comprehensive loss, net
|
(4,053
|
)
|
|
(29,990
|
)
|
|
(34,043
|
)
|
|||
Balance at March 31, 2020
|
$
|
(5,378
|
)
|
|
$
|
(252,058
|
)
|
|
$
|
(257,436
|
)
|
|
Three Months Ended
March 31, |
||||||
|
2020
|
|
2019
|
||||
Numerator:
|
|
|
|
||||
Net income (loss)
|
$
|
(157,833
|
)
|
|
$
|
85,201
|
|
Denominator:
|
|
|
|
||||
Weighted-average ordinary shares used in per share calculations - basic
|
55,956
|
|
|
57,206
|
|
||
Dilutive effect of employee equity incentive and purchase plans
|
—
|
|
|
875
|
|
||
Weighted-average ordinary shares used in per share calculations - diluted
|
55,956
|
|
|
58,081
|
|
||
|
|
|
|
||||
Net income (loss) per ordinary share:
|
|
|
|
||||
Basic
|
$
|
(2.82
|
)
|
|
$
|
1.49
|
|
Diluted
|
$
|
(2.82
|
)
|
|
$
|
1.47
|
|
|
Three Months Ended
March 31, |
||||
|
2020
|
|
2019
|
||
Exchangeable Senior Notes
|
5,504
|
|
|
5,504
|
|
Options, RSUs and ESPP
|
5,611
|
|
|
4,988
|
|
|
Three Months Ended
March 31, |
||||||
|
2020
|
|
2019
|
||||
Xyrem
|
$
|
407,875
|
|
|
$
|
368,317
|
|
Erwinaze/Erwinase
|
37,732
|
|
|
60,899
|
|
||
Defitelio/defibrotide
|
47,432
|
|
|
41,500
|
|
||
Vyxeos
|
32,720
|
|
|
28,943
|
|
||
Sunosi
|
1,924
|
|
|
—
|
|
||
Other
|
2,522
|
|
|
3,672
|
|
||
Product sales, net
|
530,205
|
|
|
503,331
|
|
||
Royalties and contract revenues
|
4,521
|
|
|
4,855
|
|
||
Total revenues
|
$
|
534,726
|
|
|
$
|
508,186
|
|
|
Three Months Ended
March 31, |
||||||
|
2020
|
|
2019
|
||||
United States
|
$
|
478,483
|
|
|
$
|
462,862
|
|
Europe
|
41,556
|
|
|
35,401
|
|
||
All other
|
14,687
|
|
|
9,923
|
|
||
Total revenues
|
$
|
534,726
|
|
|
$
|
508,186
|
|
|
Contract Liabilities
|
||
Balance as of December 31, 2019
|
$
|
9,581
|
|
Amount recognized within royalties and contract revenues
|
(1,180
|
)
|
|
Balance as of March 31, 2020
|
$
|
8,401
|
|
|
Three Months Ended
March 31, |
||||||
|
2020
|
|
2019
|
||||
Selling, general and administrative
|
$
|
20,596
|
|
|
$
|
20,370
|
|
Research and development
|
6,385
|
|
|
5,523
|
|
||
Cost of product sales
|
1,673
|
|
|
1,659
|
|
||
Total share-based compensation expense, pre-tax
|
28,654
|
|
|
27,552
|
|
||
Income tax benefit from share-based compensation expense
|
(3,746
|
)
|
|
(3,667
|
)
|
||
Total share-based compensation expense, net of tax
|
$
|
24,908
|
|
|
$
|
23,885
|
|
|
Three Months Ended
March 31, |
||||||
|
2020
|
|
2019
|
||||
Shares underlying options granted (in thousands)
|
565
|
|
|
1,297
|
|
||
Grant date fair value
|
$
|
33.65
|
|
|
$
|
42.84
|
|
Black-Scholes option pricing model assumption information:
|
|
|
|
||||
Volatility
|
32
|
%
|
|
32
|
%
|
||
Expected term (years)
|
4.6
|
|
|
4.5
|
|
||
Range of risk-free rates
|
0.8-1.6%
|
|
|
2.4-2.5%
|
|
||
Expected dividend yield
|
—
|
%
|
|
—
|
%
|
|
Three Months Ended
March 31, |
||||||
|
2020
|
|
2019
|
||||
RSUs granted (in thousands)
|
959
|
|
|
519
|
|
||
Grant date fair value
|
$
|
114.19
|
|
|
$
|
139.38
|
|
•
|
Xyrem® (sodium oxybate) oral solution, the only product approved by the U.S. Food and Drug Administration, or FDA, and marketed in the U.S. for the treatment of both cataplexy and excessive daytime sleepiness, or EDS, in both adult and pediatric patients with narcolepsy;
|
•
|
Sunosi® (solriamfetol), a product approved by FDA and marketed in the U.S. to improve wakefulness in adult patients with EDS associated with narcolepsy or obstructive sleep apnea, or OSA, and also recently approved in Europe in January 2020 by the European Commission, or EC;
|
•
|
Defitelio® (defibrotide sodium), a product approved in the U.S. for the treatment of adult and pediatric patients with hepatic veno-occlusive disease, or VOD, also known as sinusoidal obstruction syndrome, with renal or pulmonary dysfunction following hematopoietic stem cell transplantation, or HSCT, and in Europe (where it is marketed as Defitelio® (defibrotide)) for the treatment of severe VOD in adults and children undergoing HSCT therapy;
|
•
|
Erwinaze® (asparaginase Erwinia chrysanthemi), a treatment approved in the U.S. and in certain markets in Europe (where it is marketed as Erwinase®) for patients with acute lymphoblastic leukemia, or ALL, who have developed hypersensitivity to E. coli-derived asparaginase; and
|
•
|
Vyxeos® (daunorubicin and cytarabine) liposome for injection, a product approved in the U.S. and in Europe (where it is marketed as Vyxeos® liposomal 44 mg/100 mg powder for concentrate for solution for infusion) for the treatment of adults with newly-diagnosed therapy-related acute myeloid leukemia, or t-AML, or AML with myelodysplasia-related changes.
|
•
|
Strong financial execution through growth in sales of our current lead marketed products;
|
•
|
Building a diversified product portfolio and development pipeline through a combination of our internal research and development efforts and obtaining rights to clinically meaningful and differentiated on- or near-market products and early- to late-stage product candidates through corporate development transactions; and
|
•
|
Maximizing the value of our products and product candidates by continuing to implement our comprehensive global development plans, including through generating additional clinical data and seeking regulatory approval for new indications and new geographies.
|
Product Candidates
|
Description
|
Submitted for Regulatory Approval
|
|
Lurbinectedin
|
Relapsed SCLC (exclusive U.S. license)
|
Phase 3
|
|
Vyxeos
|
AML or high-risk Myelodysplastic Syndrome, or MDS (AML18 and AML19) (cooperative group studies)
|
Newly diagnosed adults with standard- and high-risk AML (AML Study Group cooperative group study)
|
|
Newly diagnosed pediatric patients with AML (planned Children’s Oncology Group cooperative group study)
|
|
Lurbinectedin
|
Relapsed SCLC (ATLANTIS) (exclusive U.S. license)
|
Phase 2/3
|
|
JZP-458 (recombinant Erwinia asparaginase)
|
ALL/LBL
|
Phase 2
|
|
Defitelio
|
Prevention of aGvHD following allogeneic HSCT
|
Prevention of CAR T-cell therapy-associated neurotoxicity
|
|
Vyxeos
|
High-risk MDS (European Myelodysplastic Syndromes Cooperative Group cooperative group study)
|
Newly diagnosed older adults with high-risk AML (planned cooperative group study)
|
|
Vyxeos + venetoclax
|
De novo or relapsed/refractory, or R/R, AML (MD Anderson collaboration study)
|
Phase 1
|
|
Vyxeos
|
Low intensity dosing for higher risk MDS (MD Anderson collaboration study)
|
Vyxeos + other approved therapies
|
R/R AML or hypomethylating agent failure MDS (MD Anderson collaboration study)
|
First-line, fit AML (Phase 1b study)
|
|
Low intensity therapy for first-line, unfit AML (Phase 1b study)
|
|
IMGN632
|
R/R CD123+ hematological malignancies (Jazz opt-in opportunity with ImmunoGen, Inc., or ImmunoGen)
|
+/- venetoclax/azacitidine in CD123+ AML (Jazz opt-in opportunity with ImmunoGen; Phase 1b/2 study)
|
|
Preclinical
|
|
CombiPlex
|
Hematology/oncology exploratory activities
|
JZP-341 (long-acting Erwinia asparaginase)
|
ALL and other hematological malignancies (collaboration with Pfenex, Inc., or Pfenex)
|
Recombinant pegaspargase
|
Hematological malignancies (Jazz opt-in opportunity with Pfenex)
|
Pan-RAF inhibitor program
|
RAF and RAS mutant tumors (acquired from Redx Pharma, which is continuing development)
|
Exosome targets (NRAS, STAT3 and 3 other candidates)
|
Hematological malignancies/solid tumors (collaboration with Codiak BioSciences, Inc.)
|
Defitelio
|
Exploratory activities
|
|
Three Months Ended
March 31, |
|
Increase/
|
|||||||
|
2020
|
|
2019
|
|
(Decrease)
|
|||||
Product sales, net
|
$
|
530,205
|
|
|
$
|
503,331
|
|
|
5
|
%
|
Royalties and contract revenues
|
4,521
|
|
|
4,855
|
|
|
(7
|
)%
|
||
Cost of product sales (excluding amortization of acquired developed technologies)
|
28,657
|
|
|
33,506
|
|
|
(14
|
)%
|
||
Selling, general and administrative
|
208,400
|
|
|
167,947
|
|
|
24
|
%
|
||
Research and development
|
86,107
|
|
|
60,105
|
|
|
43
|
%
|
||
Intangible asset amortization
|
62,847
|
|
|
56,885
|
|
|
10
|
%
|
||
Impairment charge
|
136,139
|
|
|
—
|
|
|
N/A(1)
|
|
||
Acquired in-process research and development
|
202,250
|
|
|
56,000
|
|
|
261
|
%
|
||
Interest expense, net
|
18,496
|
|
|
17,922
|
|
|
3
|
%
|
||
Foreign exchange loss
|
1,132
|
|
|
611
|
|
|
85
|
%
|
||
Income tax provision (benefit)
|
(51,287
|
)
|
|
29,116
|
|
|
N/A(1)
|
|
||
Equity in loss (gain) of investees
|
(182
|
)
|
|
893
|
|
|
(120
|
)%
|
(1)
|
Comparison to prior period not meaningful.
|
|
Three Months Ended
March 31, |
|
Increase/
|
|||||||
|
2020
|
|
2019
|
|
(Decrease)
|
|||||
Xyrem
|
$
|
407,875
|
|
|
$
|
368,317
|
|
|
11
|
%
|
Erwinaze/Erwinase
|
37,732
|
|
|
60,899
|
|
|
(38
|
)%
|
||
Defitelio/defibrotide
|
47,432
|
|
|
41,500
|
|
|
14
|
%
|
||
Vyxeos
|
32,720
|
|
|
28,943
|
|
|
13
|
%
|
||
Sunosi
|
1,924
|
|
|
—
|
|
|
N/A(1)
|
|
||
Other
|
2,522
|
|
|
3,672
|
|
|
(31
|
)%
|
||
Product sales, net
|
530,205
|
|
|
503,331
|
|
|
5
|
%
|
||
Royalties and contract revenues
|
4,521
|
|
|
4,855
|
|
|
(7
|
)%
|
||
Total revenues
|
$
|
534,726
|
|
|
$
|
508,186
|
|
|
5
|
%
|
|
Three Months Ended
March 31, |
||||||
|
2020
|
|
2019
|
||||
Clinical studies and outside services
|
$
|
47,749
|
|
|
$
|
30,231
|
|
Personnel expenses
|
25,902
|
|
|
21,310
|
|
||
Other
|
12,456
|
|
|
8,564
|
|
||
Total
|
$
|
86,107
|
|
|
$
|
60,105
|
|
|
Three Months Ended
March 31, |
||||||
|
2020
|
|
2019
|
||||
Net cash provided by operating activities
|
$
|
272,969
|
|
|
$
|
202,253
|
|
Net cash (used in) provided by investing activities
|
(60,080
|
)
|
|
166,052
|
|
||
Net cash used in financing activities
|
(147,683
|
)
|
|
(130,349
|
)
|
||
Effect of exchange rates on cash and cash equivalents
|
(948
|
)
|
|
(112
|
)
|
||
Net increase in cash and cash equivalents
|
$
|
64,258
|
|
|
$
|
237,844
|
|
•
|
An increase in net cash inflow related to changes in operating assets and liabilities primarily driven by the timing of receipts from customers.
|
•
|
$146.3 million increase in upfront payments for acquired IPR&D primarily driven by the $200.0 million payment under our license agreement with PharmaMar in the three months ended March 31, 2020, compared to the same period in 2019 which included a payment of $56.0 million under our strategic collaboration agreement with Codiak;
|
•
|
$70.0 million decrease in net proceeds from maturity of investments; and
|
•
|
$13.0 million increase in acquisition of intangible assets.
|
•
|
An increase of $27.8 million in share repurchases, partially offset by a $10.2 million increase in proceeds from the exercise of options and our employee stock purchase plan.
|
Item 3.
|
Quantitative and Qualitative Disclosures About Market Risk
|
Item 4.
|
Controls and Procedures
|
Item 1A.
|
Risk Factors
|
•
|
the clinical indications for which a product is approved and any restrictions placed upon the product in connection with its approval, such as a REMS, patient registry requirements or labeling restrictions;
|
•
|
the prevalence of the disease or condition for which the product is approved and its diagnosis;
|
•
|
the severity of side effects and other risks in relation to the benefits of our products;
|
•
|
acceptance by physicians and patients of each product as a safe and effective treatment;
|
•
|
availability of sufficient product inventory to meet demand, particularly with respect to Erwinaze;
|
•
|
physicians’ decisions relating to treatment practices based on availability of product, particularly with respect to Erwinaze;
|
•
|
perceived advantages over alternative treatments;
|
•
|
relative convenience and ease of administration;
|
•
|
with respect to Xyrem, physician and patient assessment of the burdens associated with obtaining or maintaining the certifications required under the Xyrem REMS;
|
•
|
the cost of treatment in relation to alternative treatments, including generic products; and
|
•
|
the availability of financial or other assistance for patients who are uninsured or underinsured.
|
•
|
the need to incur substantial debt or engage in dilutive issuances of equity securities to pay for acquisitions;
|
•
|
the potential disruption of our historical core business;
|
•
|
the strain on, and need to continue to expand, our existing operational, technical, financial and administrative infrastructure;
|
•
|
the difficulties in integrating acquired products and product candidates into our portfolio;
|
•
|
the difficulties in assimilating employees and corporate cultures;
|
•
|
the failure to retain key managers and other personnel;
|
•
|
the need to write down assets or recognize impairment charges;
|
•
|
the diversion of our management’s attention to integration of operations and corporate and administrative infrastructures; and
|
•
|
any unanticipated liabilities for activities of or related to the acquired business or its operations, products or product candidates.
|
•
|
direct and indirect effects of the ongoing COVID-19 pandemic on various aspects and stages of the clinical development process, including the inherent limitations of remote and virtual approaches;
|
•
|
difficulty identifying, recruiting or enrolling eligible patients, often based on the number of clinical trials, particularly in hematology and oncology, with enrollment criteria targeting the same patient population;
|
•
|
significant reprioritization and diversion of healthcare resources away from the conduct of clinical trials as a result of the ongoing COVID-19 pandemic, including the diversion of hospitals serving as our clinical trial sites and hospital staff supporting the conduct of our clinical trials;
|
•
|
difficulty identifying a clinical development pathway, including viable indications and appropriate clinical trial protocol design, particularly where there is no applicable regulatory precedent;
|
•
|
delays or failures in obtaining regulatory authorization to commence a trial because of safety concerns of regulators relating to our product candidates or similar product candidates of our competitors or failure to follow regulatory guidelines;
|
•
|
interruption of key clinical trial activities, such as clinical trial site monitoring, due to limitations on travel, quarantines or social distancing protocols imposed or recommended by federal or state governments, employers and others in connection with the ongoing COVID-19 pandemic;
|
•
|
delays or failures in obtaining clinical materials and manufacturing sufficient quantities of the product candidate for use in trials;
|
•
|
delays or failures in reaching agreement on acceptable terms with prospective study sites;
|
•
|
delays or failures in obtaining approval of our clinical trial protocol from an institutional review board, known as an ethics committee in Europe, to conduct a clinical trial at a prospective study site;
|
•
|
failure of our clinical trials and clinical investigators, including contract research organizations or other third parties assisting us with clinical trials, to satisfactorily perform their contractual duties, meet expected deadlines and comply with FDA and other regulatory agencies’ requirements, including good clinical practices;
|
•
|
unforeseen safety issues;
|
•
|
inability to monitor patients adequately during or after treatment;
|
•
|
difficulty monitoring multiple study sites; or
|
•
|
insufficient funds to complete the trials.
|
•
|
our patent applications, or those of our licensors or partners, may not result in issued patents;
|
•
|
others may independently develop similar or therapeutically equivalent products without infringing our patents, or those of our licensors, such as products that are not covered by the claims of our patents, or for which we do not have adequate exclusive rights under our license agreements;
|
•
|
our issued patents, or those of our licensors or partners, may be held invalid or unenforceable as a result of legal challenges by third parties or may be vulnerable to legal challenges as a result of changes in applicable law;
|
•
|
we or our licensors or partners might not have been the first to invent or file, as appropriate, subject matters covered by our issued patents or pending patent applications or those of our licensors or partners;
|
•
|
competitors may manufacture products in countries where we have not applied for patent protection or that have a different scope of patent protection or that do not respect our patents; or
|
•
|
others may be issued patents that prevent the sale of our products or require licensing and the payment of significant fees or royalties.
|
•
|
the diverse regulatory, financial and legal requirements in the countries where we are located or do business, and any changes to those requirements;
|
•
|
challenges inherent in efficiently managing employees in diverse geographies, including the need to adapt systems, policies, benefits and compliance programs to differing labor and employment law and other regulations, as well as maintaining positive interactions with our unionized employees;
|
•
|
costs of, and liabilities for, our international operations, products or product candidates; and
|
•
|
public health risks, such as the current global COVID-19 pandemic and potential related effects on supply chain, travel and employee health and availability.
|
•
|
limit our ability to borrow additional funds for working capital, capital expenditures, acquisitions or other general business purposes;
|
•
|
limit our ability to use our cash flow or obtain additional financing for working capital, capital expenditures, acquisitions, investments or other general business purposes;
|
•
|
require us to use a substantial portion of our cash flow from operations to make debt service payments;
|
•
|
limit our flexibility to plan for, or react to, changes in our business and industry, or our ability to take specified actions to take advantage of certain business opportunities that may be presented to us;
|
•
|
result in dilution to our existing shareholders in the event exchanges of our exchangeable senior notes are settled in our ordinary shares;
|
•
|
place us at a competitive disadvantage compared to our less leveraged competitors; and
|
•
|
increase our vulnerability to the impact of adverse economic and industry conditions.
|
•
|
incur or assume liens or additional debt or provide guarantees in respect of obligations of other persons;
|
•
|
pay dividends or distributions or redeem or repurchase capital stock;
|
•
|
prepay, redeem or repurchase certain debt;
|
•
|
make loans, investments, acquisitions (including acquisitions of exclusive licenses) and capital expenditures;
|
•
|
enter into agreements that restrict distributions from our subsidiaries;
|
•
|
sell assets and capital stock of our subsidiaries; and
|
•
|
consolidate or merge with or into, or sell substantially all of our assets to, another person.
|
Item 2.
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
|
Total Number of Shares Purchased (1)
|
|
Average Price Paid per Share (2)
|
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (3)
|
|
Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs (4)
|
||||||
January 1 - January 31, 2020
|
88,300
|
|
|
$
|
147.12
|
|
|
88,300
|
|
|
$
|
564,742,952
|
|
February 1 - February 29, 2020
|
144,000
|
|
|
$
|
135.55
|
|
|
144,000
|
|
|
$
|
545,227,319
|
|
March 1 - March 31, 2020
|
899,000
|
|
|
$
|
118.51
|
|
|
899,000
|
|
|
$
|
438,702,778
|
|
Total
|
1,131,300
|
|
|
$
|
122.91
|
|
|
1,131,300
|
|
|
|
(1)
|
This table does not include ordinary shares that we withheld in order to satisfy minimum tax withholding requirements in connection with the vesting and release of restricted stock units.
|
(2)
|
Average price paid per ordinary share includes brokerage commissions.
|
(3)
|
The ordinary shares reported in this column above were purchased pursuant to our publicly announced share repurchase program. In November 2016, we announced that our board of directors authorized the use of up to $300 million to repurchase our ordinary shares. In November 2018, December 2018, and October 2019, our board of directors increased the existing share repurchase program authorization by $320.0 million, $400.0 million, and $500.0 million respectively thereby increasing the total amount authorized for repurchase to $1.5 billion.
|
(4)
|
The dollar amount shown represents, as of the end of each fiscal month, the approximate dollar value of ordinary shares that may yet be purchased under our publicly announced share repurchase program, exclusive of any brokerage commissions. The timing and amount of repurchases will depend on a variety of factors, including the price of our ordinary shares, alternative investment opportunities, restrictions under our credit agreement, corporate and regulatory requirements and market conditions, and may be modified, suspended or otherwise discontinued at any time without prior notice.
|
Item 6.
|
Exhibits
|
Exhibit
Number
|
Description of Document
|
2.1
|
|
2.2
|
|
2.3
|
|
2.4
|
|
2.5
|
|
2.6†
|
|
2.7†
|
|
2.8
|
|
2.9
|
|
3.1
|
|
4.1
|
|
4.2A
|
|
4.2B
|
|
4.3A
|
|
4.3B
|
|
10.1+
|
10.2+
|
|
10.3+
|
|
10.4+
|
|
31.1
|
|
31.2
|
|
32.1*
|
|
101.INS
|
XBRL Instance Document - The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
|
101.SCH
|
Inline XBRL Taxonomy Extension Schema Document
|
101.CAL
|
Inline XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF
|
Inline XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB
|
Inline XBRL Taxonomy Extension Labels Linkbase Document
|
101.PRE
|
Inline XBRL Taxonomy Extension Presentation Linkbase Document
|
104
|
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
|
+
|
Indicates management contract or compensatory plan.
|
†
|
Confidential treatment has been granted for portions of this exhibit. Omitted portions have been filed separately with the SEC.
|
*
|
The certification attached as Exhibit 32.1 accompanies this Quarterly Report on Form 10-Q pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, and shall not be deemed “filed” by the Registrant for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.
|
JAZZ PHARMACEUTICALS PUBLIC LIMITED COMPANY
(Registrant)
|
|
/s/ Bruce C. Cozadd
|
Bruce C. Cozadd
|
Chairman and Chief Executive Officer and Director
(Principal Executive Officer)
|
|
/s/ Renée Galá
|
Renée Galá
|
Executive Vice President and Chief Financial Officer
(Principal Financial Officer)
|
|
/s/ Patricia Carr
|
Patricia Carr
|
Vice President, Finance
(Principal Accounting Officer)
|
1.
|
Duties and Responsibilities. Your initial assignment will be as Executive Vice President and Chief Financial Officer, reporting to me. This offer is for a full-time position, located at Jazz Pharmaceuticals’ offices in Palo Alto. The position may require you to travel from time to time to other locations as may be necessary to fulfill your responsibilities. As part of your employment relationship, you agree to comply with Jazz Pharmaceuticals’ policies and procedures in effect from time to time during your employment. As an exempt employee, you are expected to work the number of hours required to do your job well, and you are not eligible for overtime compensation.
|
2.
|
Salary; Annual Bonus; Signing Bonus. Your initial annual base salary rate will be $600,000 payable in accordance with Jazz Pharmaceuticals’ customary payroll practices, for all hours worked. Salary is subject to periodic review and adjustment by Jazz Pharmaceuticals, in accordance with its normal practices; we have a company-wide performance review process that takes place early in each calendar year.
|
3.
|
Benefits. You generally will be eligible to receive all benefits which are extended to other similarly-situated employees at Jazz Pharmaceuticals, subject to the terms and conditions of the benefit plans, including medical and dental benefits, life insurance and other benefits offered to regular employees. You will be eligible for paid time off and holidays in accordance with Jazz Pharmaceuticals’ policies, and you will be a participant in the Company’s Amended and Restated Executive Change in Control and Severance Benefit Plan.
|
4.
|
Equity. Your offer includes a grant of options to purchase 41,500 Jazz Pharmaceuticals plc ordinary shares and a grant of 16,600 restricted stock units (RSUs) giving you a right to receive Jazz Pharmaceuticals plc ordinary shares at a future date, subject to approval by the Compensation Committee, the terms and conditions of the Jazz Pharmaceuticals plc 2011 Equity Incentive Plan, and the terms and conditions of the applicable award agreements, which will be provided to you as soon as practicable after the grant date. Subject to your continued employment on each vesting date, the options will vest 1/4th on the first annual anniversary of your start date and 1/48th of the total granted per month thereafter, and the RSUs will vest 1/4th annually over four years. The options will have an exercise price that equals the fair market value of Jazz Pharmaceuticals plc ordinary shares on the date of grant. The RSUs will have no exercise price. The options and RSUs will be granted on the second trading day following the filing date of the Company’s next quarterly report filed with the U.S. Securities and Exchange Commission following your start date in accordance with the Company’s Equity Incentive Grant Policy.
|
5.
|
Confidential Information; Employee Confidential Information and Inventions Agreement. To enable Jazz Pharmaceuticals to safeguard its proprietary and confidential information, it is a condition of employment that you sign Jazz Pharmaceuticals’ standard form of “Employee Confidential Information and Inventions Agreement.” We understand that you are likely to have signed similar agreements with prior employers, and wish to impress upon you that Jazz
|
6.
|
Code of Conduct. Jazz Pharmaceuticals is committed to integrity and the pursuit of excellence in all we do. We fulfill these commitments while upholding a high level of ethical conduct. The Code of Conduct is one element of Jazz Pharmaceuticals’ efforts to ensure lawful and ethical conduct by the company and its subsidiaries and their employees, officers and directors. It is a condition of employment that you read, agree to and sign Jazz Pharmaceuticals’ Code of Conduct in the first week of employment. If you have questions about the Code of Conduct, please let Human Resources know and we will ensure that you receive answers to your inquiries as quickly as possible.
|
7.
|
At-Will Employment. Should you decide to accept our offer, you will be an “at-will” employee of Jazz Pharmaceuticals. This means that either you or Jazz Pharmaceuticals may terminate the employment relationship with or without cause at any time. Participation in any benefit, compensation or bonus program does not change the nature of the employment relationship, which remains “at-will”.
|
8.
|
Authorization to Work. Federal government regulations require that all prospective employees present documentation verifying their identity and demonstrating that they are authorized to work in the United States. If you have any questions about this requirement, which applies to U.S. citizens and non-U.S. citizens alike, please contact Heidi Manna, our Senior Vice President, Human Resources. Your employment is contingent on your ability to prove your identity and authorization to work in the United States, and you’re complying with the government’s employment verification requirements.
|
9.
|
Complete Offer and Agreement. This letter contains our complete understanding and agreement regarding the terms of your employment by Jazz Pharmaceuticals. There are no other, different or prior agreements or understandings on this or related subjects. Changes to the terms of your employment can be made only in a writing signed by you and the Chief Executive Officer of Jazz Pharmaceuticals, although it is understood that as part of the policy of employment at will, Jazz Pharmaceuticals may, from time to time, in its sole discretion, adjust your salary,
|
10.
|
Start Date; Acceptance of Offer. We hope that you will accept this offer promptly and begin your full-time employment at Jazz Pharmaceuticals by March 16, 2020. If our offer is acceptable to you, please sign the enclosed copy of this letter in the space indicated and return it to me by February 24, 2020.
|
11.
|
Severability. If any provision of this offer is held to be invalid, void or unenforceable, the remainder of the agreement set forth herein will remain unaffected, and you and Jazz Pharmaceuticals will work together to achieve the intent of the affected provisions.
|
ACCEPTANCE OF EMPLOYMENT OFFER:
|
||
I accept the offer of employment by Jazz Pharmaceuticals on the terms set forth in this letter.
|
||
Signature:
|
/s/ Renée Galá
|
RG
|
Date:
|
23-Feb-2020
|
|
My start date will be
|
March 16, 2020
|
|
1.
|
New Employment Terms Due to Promotion. The below employment terms were amended effective 31 October 2019 in connection with Executive’s promotion to the role of SVP, Technical Operations on a non-interim basis.
|
a.
|
Position: Clause 1 is amended to state Executive’s role of SVP, Technical Operations.
|
b.
|
Reporting Relationship: Clause 5 is amended to state Executive’s reporting relationship to the President and Chief Operating Officer.
|
c.
|
Salary: Clause 6.1 is amended to state Executive’s annual basic salary rate of €309,000.
|
d.
|
Bonus: Clause 7.1 is amended to state that Executive’s eligibility for an annual bonus for 2020 will be governed by the terms and conditions of the Jazz Pharmaceuticals Cash Bonus Plan (Ireland and Other Specified Affiliates) (Calendar Year 2020). Bonus eligibility for other calendar years will be governed by the terms and conditions of any approved bonus plan or program in effective during the relevant calendar year.
|
2.
|
Change in Control Severance Benefits. The attached Schedule 1, effective as of 11 February 2020, contains the terms and conditions of Executive’s eligibility for certain change in control severance benefits.
|
3.
|
Miscellaneous. This Amendment, including Schedule 1, sets forth all modifications to the Employment Agreement, and the other terms of the Employment Agreement remain in full force and effect. This Amendment can only be modified in a written agreement signed by both parties.
|
|
|
|
|
|
/s/ Heidi Manna
|
|
/s/ Finbar Larkin
|
||
Heidi Manna
Chief Human Resources Officer
Jazz Pharmaceuticals
|
|
Finbar Larkin
|
||
|
|
|
|
|
Date:
|
23-Feb-2020
|
|
Date:
|
26-Feb-2020
|
1.
|
Covered Termination: Finbar Larkin (the “Executive”) will be eligible for the severance benefits set forth in this Schedule 1 (the “Severance Benefits”) in the event of a Covered Termination which is effective on or within twelve (12) months following a Change in Control, subject to the requirements set forth in this Schedule 1.
|
2.
|
Severance Benefits: The Severance Benefits will consist of cash severance payment and payments for continued health care insurance coverage, as follows:
|
a.
|
Cash Severance Benefits: A lump sum cash severance payment will be paid to the Executive in a gross amount equal to the sum of the following three components (the “Severance Payment”):
|
(1)
|
€300,000 x 150% (1.5) = €450,000
|
(2)
|
€300.000 x bonus percentage (.45) x 150% (1.5) = €202,500
|
(3)
|
€300,000 x bonus percentage (.45) x 6/12 = €67,500
|
b.
|
Health Continuation Coverage Benefits: To the extent that Executive elects continued private health insurance coverage following the Covered Termination at a level equivalent to the private health insurance coverage provided to Executive during his employment, the Employer shall pay the applicable premiums (inclusive of premiums for the Executive’s participating dependents, if any) for such plan coverage for a period of eighteen (18) months following the date of the Covered Termination (or such earlier date if the Executive dies, if Executive and/or his dependents are no longer eligible for coverage, or if Executive obtains new employment which includes eligibility for health plan coverage). The provision of these benefits is subject to commensurate health insurance coverage being
|
3.
|
Certain Definitions:
|
a.
|
“Affiliate” means any “parent” or “subsidiary” of Employer as such terms are defined in Rule 405 of the United States Securities Act of 1933, as amended.
|
b.
|
“Bonus Percentage” means the greater of (i) any annual bonus, expressed as a percentage of annual base salary paid in the year of determination, paid to the Executive by the Company or an Affiliate in respect of either of the last two calendar years prior to the date of a Covered Termination or (ii) the Executive’s target bonus, expressed as a percentage of annual base salary, for the calendar year in which the Covered Termination occurs.
|
c.
|
“Bonus Multiplier” means the quotient obtained by dividing the number of full months that the Executive is employed by the Company or an Affiliate in the calendar year of a Covered Termination by twelve (12).
|
d.
|
“Change in Control” means “Change in Control” as defined in the Jazz Pharmaceuticals plc Amended and Restated Executive Change in Control and Severance Benefit Plan.
|
e.
|
“Cause” means the occurrence of any one or more of the following:
|
i.
|
the Executive’s unauthorised use or disclosure of the confidential information or trade secrets of the Employer or its Affiliates which use or disclosure causes material harm to the Employer or an Affiliate;
|
ii.
|
the Executive’s material breach of any agreement between the Executive and the Employer or an Affiliate which remains uncured for ten (10) business days after receiving written notification of the breach from the Employer;
|
iii.
|
the Executive’s material failure to comply with the written policies or rules of the Employer or an Affiliate which remains uncured for ten (10) business days after receiving written notification of the breach from the Employer;
|
iv.
|
the Executive’s conviction of, or plea of guilty or no contest to, any crime involving fraud, dishonesty, or moral turpitude under the laws of any United States or Irish Federal, state, local, or foreign governmental authority;
|
v.
|
the Executive’s gross misconduct;
|
vi.
|
the Executive’s continuing failure to perform assigned duties after receiving written notification of the failure from the Employer;
|
vii.
|
the Executive’s failure to cooperate in good faith with a governmental or internal investigation of the Employer, its Affiliates, directors, officers, or employees, if the Employer has requested the Executive’s cooperation; or
|
viii.
|
any action of Executive warranting summary dismissal or termination without prior notice under Executive’s Terms and Conditions of Employment dated 22 February 2013, as amended, or such other employment agreement with the Employer as in effect on the Covered Termination (as applicable, the “Employment Agreement”) or under applicable employment laws.
|
f.
|
“Constructive Termination” means a resignation of employment by Executive after an action or event which constitutes Good Reason is undertaken by Employer or an Affiliate, or otherwise occurs, provided such action or event is not agreed to by Executive in writing; provided, however, that in order for Executive’s resignation to constitute a Constructive Termination, Executive must (i) provide written notice to Employer’s General Counsel within thirty (30) days after the first occurrence of the event giving rise to Good Reason setting forth the basis for such resignation, (ii) allow Employer at least thirty (30) days from receipt of such written notice to cure such event, and (iii) if such event is not reasonably cured within such period, resign from all positions Executive then holds with Employer and any Affiliate effective not later than ninety (90) days after the expiration of the cure period.
|
g.
|
“Covered Termination” means either (i) an Involuntary Termination Without Cause, or (ii) a Constructive Termination. Termination of employment of Executive due to death or disability shall not constitute a Covered Termination unless a resignation of employment by Executive immediately prior to Executive’s death or disability would have qualified as a Constructive Termination.
|
h.
|
“Employer” means the corporate entity which employed Executive as of the effective date of the Covered Termination (including any predecessor or successor entity).
|
i.
|
“Executive” means Finbar Larkin.
|
j.
|
“Good Reason” means the occurrence of any one or more of the following actions or events without Executive’s written consent:
|
i.
|
a reduction in Executive’s base salary by more than ten percent (10%) (other than a reduction in conjunction with (x) a Company-wide salary reduction, or (y) a salary reduction involving senior management of Employer which results in salary reductions for employees similarly-situated to Executive);
|
ii.
|
a relocation of Executive’s place of employment that increases Executive’s one-way commute by more than thirty-five (35) miles;
|
iii.
|
a substantial reduction in Executive’s duties or responsibilities (and not simply a change in reporting relationships) in effect immediately prior to the effective date of the Change in Control; provided, however, that it shall not constitute “Good Reason” if, following the effective date of the Change in Control, either (x) Employer is retained as a separate legal entity or business unit and Executive holds the same position in such legal entity or business unit as Executive held before such effective date, (y) Executive holds a position with duties and responsibilities comparable (although not necessarily identical, in view of the relative sizes of Employer and the entity involved in the Change in Control) to the duties and responsibilities of Executive prior to the effective date of the Change in Control; or
|
iv.
|
a reduction in the Executive’s title.
|
k.
|
“Involuntary Termination Without Cause” means a termination by the Employer of the Executive’s employment relationship with the Employer or an Affiliate for any reason other than for Cause and other than as a result of death or disability.
|
4.
|
Additional Terms for Severance Benefits: The following additional terms shall apply:
|
a.
|
Release: In order to be eligible to receive, and prior to receipt of, any of the Severance Benefits, the Executive must execute a general waiver and release and return such release to Employer within the time period specified therein, but in no event more than forty-five (45) days following the date of the Covered Termination, and such release must become effective in accordance with its terms but in all cases
|
b.
|
Mitigation: The Executive shall not be required to mitigate damages as a condition of the Severance Benefits by seeking other employment or otherwise. Similarly, no amount of the Severance Benefits shall be reduced by any compensation earned by the Executive as a result of employment by another employer or any retirement benefits received by such Executive after the date of the Executive’s termination of employment with the Employer, except for Severance Benefits relating to payments for health continuation coverage provided above.
|
c.
|
Tax Withholding, Contributions: All payments under this Schedule will be subject to all applicable deductions and withholdings of tax, PRSI, Universal Social Charge, and any other deductions which are required pursuant to the terms of the Executive’s employment or by law, or which are provided for in the Executive’s Employment Agreement and/or this Schedule.
|
●
|
The time period that you will remain in your current position of Executive Vice President, U.S. Commercial is extended through May 31, 2020, or such later date if deemed appropriate by Bruce Cozadd and Dan Swisher. Thereafter, you will move into the project-based role of EVP, Special Projects and you will cease to be a Section 16 officer or a member of the Company’s Executive Committee. You will remain in the EVP, Special Projects role for a period of three (3) months, and then your employment will end (this date is referred to as the “Termination Date” in the Agreement). During your period of continued employment (both in your current role, and once you move into the role of EVP, Special Projects), you will continue to be paid your current full-time base salary, you will receive regular employee benefits coverage (subject to the terms and conditions of the benefit plans), and your equity awards will continue to vest on their regular vesting schedules.
|
●
|
As already provided under Section 3(c) of the Agreement, the 2020 prorated bonus that you will be eligible to receive will be calculated based on the period of time that you remain in your current role of Executive Vice President, U.S. Commercial. Thus, if you move out of that role effective May 31, 2020, the 2020 prorated bonus will be calculated as 5/12th of the applicable “at target” amount as set forth in the Cash Bonus Plan (which is a total of $100,312.50).
|
Sincerely,
JAZZ PHARMACEUTICALS, INC.
|
|
|
|
By:
|
/s/ Heidi Manna
|
|
Heidi Manna
Chief Human Resources Officer
|
|
|
REVIEWED, UNDERSTOOD, AND AGREED:
|
|
/s/ Mike Miller
|
|
Michael P. Miller
|
|
31-Mar-2020
|
|
Date
|
1.
|
Change in Control Severance Benefits. The attached Schedule 1, effective as of 11 February 2020, contains the terms and conditions of Executive’s eligibility for certain change in control severance benefits.
|
2.
|
Miscellaneous. This Amendment, including Schedule 1, sets forth all modifications to the Employment Contract, and the other terms of the Employment Contract remain in full force and effect. This Amendment can only be modified in a written agreement signed by both parties.
|
|
|
|
|
|
/s/ Heidi Manna
|
|
/s/ Samantha Pearce
|
||
Heidi Manna
Chief Human Resources Officer
Jazz Pharmaceuticals
|
|
Samantha Pearce
|
||
|
|
|
|
|
Date:
|
21-Apr-2020
|
|
Date:
|
18-Apr-2020
|
1.
|
Covered Termination: Samantha Pearce (the “Executive”) will be eligible for the severance benefits set forth in this Schedule 1 (the “Severance Benefits”) in the event of a Covered Termination which is effective on or within twelve (12) months following a Change in Control, subject to the requirements set forth in this Schedule 1.
|
2.
|
Severance Benefits: The Severance Benefits will consist of cash severance payment and payments for continued health care insurance coverage, as follows:
|
a.
|
Cash Severance Benefits: A lump sum cash severance payment will be paid to the Executive in a gross amount equal to the sum of the following three components (the “Severance Payment”):
|
(1)
|
£300,000 x 150% (1.5) = £450,000
|
(2)
|
£300.000 x bonus percentage (.45) x 150% (1.5) = £202,500
|
(3)
|
£300,000 x bonus percentage (.45) x 6/12 = £67,500
|
b.
|
Health Continuation Coverage Benefits: To the extent that Executive elects continued private health insurance coverage following the Covered Termination at a level equivalent to the private health insurance coverage provided to Executive during her employment, the Employer shall pay the applicable premiums (inclusive of premiums for the Executive’s participating dependents, if any) for such plan
|
3.
|
Certain Definitions:
|
a.
|
“Affiliate” means any “parent” or “subsidiary” of the Employer as such terms are defined in Rule 405 of the United States Securities Act of 1933, as amended.
|
b.
|
“Bonus Percentage” means the greater of (i) any annual bonus, expressed as a percentage of annual base salary paid in the year of determination, paid to the Executive by the Company or an Affiliate in respect of either of the last two calendar years prior to the date of a Covered Termination or (ii) the Executive’s target bonus, expressed as a percentage of annual base salary, for the calendar year in which the Covered Termination occurs.
|
c.
|
“Bonus Multiplier” means the quotient obtained by dividing the number of full months that the Executive is employed by the Company or an Affiliate in the calendar year of a Covered Termination by twelve (12).
|
d.
|
“Change in Control” means “Change in Control” as defined in the Jazz Pharmaceuticals plc Amended and Restated Executive Change in Control and Severance Benefit Plan.
|
e.
|
“Cause” means the occurrence of any one or more of the following:
|
i.
|
the Executive’s unauthorised use or disclosure of the confidential information or trade secrets of the Employer or its Affiliates which use or disclosure causes material harm to the Employer or an Affiliate;
|
ii.
|
the Executive’s material breach of any agreement between the Executive and the Employer or an Affiliate which remains uncured for ten (10) business days after receiving written notification of the breach from the Employer;
|
iii.
|
the Executive’s material failure to comply with the written policies or rules of the Employer or an Affiliate which remains uncured for ten (10) business days after receiving written notification of the breach from the Employer;
|
iv.
|
the Executive’s conviction of, or plea of guilty or no contest to, any crime involving fraud, dishonesty, or moral turpitude under the laws of any United States, England, Federal, state, local, or foreign governmental authority;
|
v.
|
the Executive’s gross misconduct;
|
vi.
|
the Executive’s continuing failure to perform assigned duties after receiving written notification of the failure from the Employer;
|
vii.
|
the Executive’s failure to cooperate in good faith with a governmental or internal investigation of the Employer, its Affiliates, directors, officers, or employees, if the Employer has requested the Executive’s cooperation; or
|
viii.
|
any action of Executive warranting summary dismissal or termination without prior notice under Executive’s employment agreement with the Employer as in effect on the Covered Termination (as applicable, the “Employment Agreement”) or under applicable employment laws.
|
f.
|
“Constructive Termination” means a resignation of employment by Executive after an action or event which constitutes Good Reason is undertaken by Employer or an Affiliate, or otherwise occurs, provided such action or event is not agreed to by Executive in writing; provided, however, that in order for Executive’s resignation to constitute a Constructive Termination, Executive must (i) provide written notice to Employer’s General Counsel within thirty (30) days after the first occurrence of the event giving rise to Good Reason setting forth the basis for such resignation, (ii) allow Employer at least thirty (30) days from receipt of such written notice to cure such event, and (iii) if such event is not reasonably cured within such period, resign from all positions Executive then holds with Employer and any Affiliate effective not later than ninety (90) days after the expiration of the cure period.
|
g.
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“Covered Termination” means either (I) an Involuntary Termination Without Cause, or (ii) a Constructive Termination. Termination of employment of Executive due to death or disability shall not constitute a Covered Termination unless a resignation of employment by Executive immediately prior to Executive’s death or disability would have qualified as a Constructive Termination.
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h.
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“Employer” means the corporate entity which employed Executive as of the effective date of the Covered Termination (including any predecessor or successor entity).
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i.
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“Executive” means Samantha Pearce.
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j.
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“Good Reason” means the occurrence of any one or more of the following actions or events without Executive’s written consent:
|
i.
|
a reduction in Executive’s base salary by more than ten percent (10%) (other than a reduction in conjunction with (x) a Company-wide salary reduction, or (y) a salary reduction involving senior management of Employer which results in salary reductions for employees similarly-situated to Executive);
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ii.
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a relocation of Executive’s place of employment that increases Executive’s one-way commute by more than thirty-five (35) miles;
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iii.
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a substantial reduction in Executive’s duties or responsibilities (and not simply a change in reporting relationships) in effect immediately prior to the effective date of the Change in Control; provided, however, that it shall not constitute “Good Reason” if, following the effective date of the Change in Control, either (x) Employer is retained as a separate legal entity or business unit and Executive holds the same position in such legal entity or business unit as Executive held before such effective date, (y) Executive holds a position with duties and responsibilities comparable (although not necessarily identical, in view of the relative sizes of Employer and the entity involved in the Change in Control) to the duties and responsibilities of Executive prior to the effective date of the Change in Control; or
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iv.
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a reduction in the Executives title.
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k.
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“Involuntary Termination Without Cause” means a termination by the Employer of the Executive’s employment relationship with the Employer or an Affiliate for any reason other than for Cause and other than as a result of death or disability.
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4.
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Additional Terms for Severance Benefits: The following additional terms shall apply:
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a.
|
Release: In order to be eligible to receive, and prior to receipt of, any of the Severance Benefits, the Executive must execute a general waiver and release and return such release to Employer within the time period specified therein, but in no event more than forty-five (45) days following the date of the Covered Termination, and such release must become effective in accordance with its terms but in all cases not later than the sixtieth (60th) day following the Covered Termination. No release shall require the Executive to forego any unpaid salary, any accrued but unpaid vacation pay, or any vested or earned benefits payable pursuant to the Executive’s Employment Agreement or by law. The Employer, in its sole discretion, may modify the form of the required release to comply with applicable law and shall determine the form of the required release.
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b.
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Mitigation: The Executive shall not be required to mitigate damages as a condition of the Severance Benefits by seeking other employment or otherwise. Similarly, no amount of the Severance Benefits shall be reduced by any compensation earned by the Executive as a result of employment by another employer or any retirement benefits received by such Executive after the date of the Executive’s termination of employment with the Employer, except for Severance Benefits relating to payments for health continuation coverage provided above.
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c.
|
Tax Withholding, Contributions: All payments under this Schedule will be subject to all applicable deductions and withholding of the Employer, including, without limitation, all obligations to withhold or make deductions for federal, state and local income and employment taxes, as well as national contributions and any other required deductions or withholdings which are required pursuant to the terms of the Executive’s employment or by law, or which are provided for in the Executive’s Employment Agreement and/or this Schedule (including for the avoidance of doubt deductions for income tax and national insurance contributions required under English law).
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1.
|
I have reviewed this Quarterly Report on Form 10-Q of Jazz Pharmaceuticals public limited company;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: May 5, 2020
|
By:
|
/s/ Bruce C. Cozadd
|
|
|
Bruce C. Cozadd
Chairman and Chief Executive Officer and Director
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Jazz Pharmaceuticals public limited company;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date: May 5, 2020
|
By:
|
/s/ Renée Galá
|
|
|
Renée Galá
Executive Vice President and Chief Financial Officer
|
1.
|
The Company’s Quarterly Report on Form 10-Q for the period ended March 31, 2020, to which this Certification is attached as Exhibit 32.1 (the “Periodic Report”), fully complies with the requirements of Section 13(a) or Section 15(d) of the Exchange Act; and
|
2.
|
The information contained in the Periodic Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/ Bruce C. Cozadd
|
Bruce C. Cozadd
|
Chairman and Chief Executive Officer and Director
|
|
/s/ Renée Galá
|
Renée Galá
|
Executive Vice President and Chief Financial Officer
|
(1)
|
This certification accompanies the Quarterly Report on Form 10-Q to which it relates, is not deemed filed with the Securities and Exchange Commission and is not to be incorporated by reference into any filing of Jazz Pharmaceuticals public limited company under the Securities Act of 1933, as amended, or the Exchange Act (whether made before or after the date of the Form 10-Q), irrespective of any general incorporation language contained in such filing. A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act of 2002 has been provided to Jazz Pharmaceuticals public limited company and will be retained by Jazz Pharmaceuticals public limited company and furnished to the Securities and Exchange Commission or its staff upon request.
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