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FORM 10-K
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Virginia
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26-0084895
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification Number)
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20374 Seneca Meadows Parkway
Germantown, Maryland
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20876
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(Address of principal executive offices)
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(Zip Code)
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Title of each class
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Name of each exchange on which registered
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Intrexon Corporation Common Stock, No Par Value
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Nasdaq Global Select Market
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Large accelerated filer
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x
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Accelerated filer
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¨
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Non-accelerated filer
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¨
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Smaller reporting company
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¨
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Emerging growth company
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¨
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Page
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Item 1.
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Item 1A.
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Item 1B.
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Item 2.
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Item 3.
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Item 4.
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Item 5.
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Item 6.
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Item 7.
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Item 7A.
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Item 8.
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Item 9.
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Item 9A.
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Item 9B.
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Item 10.
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Item 11.
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Item 12.
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Item 13.
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Item 14.
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Item 15.
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Item 16.
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our strategy and overall approach to our business model;
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our ability to successfully enter new markets or develop additional products, whether independently or with our collaborators;
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our ability to successfully enter into optimal strategic relationships with our subsidiaries and operating companies that we may form in the future;
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competition from existing technologies and products or new technologies and products that may emerge;
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actual or anticipated variations in our operating results;
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our current and future joint ventures, or JVs, exclusive channel collaborations, or ECCs, license agreements and other collaborations;
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developments concerning our collaborators and licensees;
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actual or anticipated fluctuations in our competitors' or our collaborators' and licensees' operating results or changes in their respective growth rates;
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our cash position;
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market conditions in our industry;
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our ability to protect our intellectual property and other proprietary rights and technologies;
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our ability to adapt to changes in laws, regulations and policies;
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our ability and the ability of our collaborators and licensees to adapt to changes in laws, regulations and policies and to secure any necessary regulatory approvals to commercialize any products developed by us or under our ECCs, license agreements and JVs;
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the ability of our collaborators and licensees to protect our intellectual property and other proprietary rights and technologies;
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our ability and the ability of our collaborators and licensees to develop and successfully commercialize products enabled by our technologies;
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the rate and degree of market acceptance of any products developed by us, our subsidiaries, a collaborator under an ECC or through a JV or license under a license agreement;
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our ability to retain and recruit key personnel;
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the result of litigation proceedings or investigations that we face currently or may face in the future;
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our expectations related to the use of proceeds from our public offerings and other financing efforts; and
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our estimates regarding expenses, future revenue, capital requirements and needs for additional financing.
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Item 1.
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Business
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Design
genes of interest and gene programs utilizing knowledge of cellular pathways and protein function;
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Build
biological molecules, gene programs and their variants to optimize performance of the biological system;
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Test
gene programs by inserting them into cellular systems and comparing the result(s) to the intended effects; and
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Learn
by utilizing information gained in our iterative processes to create better gene programs and cellular systems using a more informed and efficient process to achieve improved outcomes.
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Platform neutral — outcome oriented.
We can work across different cell types with the objective of achieving the intended biological outcome allowing for product development across a broad spectrum of end markets.
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Knowledge driven.
We use statistical modeling tools and computational analysis to continually acquire more knowledge about biological systems and their design to continually improve our ability to develop new and improved products and processes.
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Rationally designed.
Our knowledge of biological systems and components allows us to design, build and select gene programs.
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Capable of complexity.
Our technologies enable the design and precise control of complex biological molecules and multigenic gene programs.
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Industrial scale.
We use engineering principles and automation to enable products based on synthetic biology that are commercially viable.
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Synthetic biology service providers
. There are companies that have competing technologies for individual pieces of our suite of complementary technologies. For example, there are companies that can synthesize DNA, and there are companies that can develop monoclonal antibodies. One portion of our proprietary technology related to DNA synthesis and assembly includes the ability to
de novo
synthesize DNA. We believe the following companies engage in the manufacture of DNA componentry: ATUM, Inc.; Blue Heron Biotech, LLC (a subsidiary of OriGene); Integrated DNA Technologies, Inc. (IDT); GenScript USA, Inc.; Life Technologies Corporation, now part of Thermo Fisher Scientific Inc.; and Twist Bioscience Corporation.
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Industrial companies who may develop their own approach to synthetic biology
. Rather than becoming a collaborator with us, potential collaborators may decide to invest time and capital to internally develop their own synthetic biology capabilities. For example, large biopharmaceutical companies, energy companies, and ag-bio companies may pursue a proprietary synthetic biology strategy.
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Industrial companies who may develop competing products using other technologies
. Products enabled by our synthetic biology will face competition in the market, including from products that have been developed using other industrial technologies. For example, large biopharmaceutical companies pursue other technologies for drug development, and large ag-bio companies pursue other technologies for the development of genetically modified crops. The rapidly evolving market for developing genetically engineered, or GE, T-cells in particular is characterized by intense competition and rapid innovation. Genetically engineering T-cells faces significant competition in the chimeric antigen receptor, or CAR, technology space from multiple companies and their collaborators, such as Novartis/University of Pennsylvania, Bluebird Bio/Celgene/Juno Therapeutics, Gilead/Kite Pharma, Cellectis, Allogene Therapeutics, Adaptimmune/GSK, Autolus Therapeutics, and Bellicum Pharmaceuticals. We face competition from non-cell based treatments offered by other companies such as Amgen, AstraZeneca, Bristol-Myers Squibb, Incyte, Merck, and Roche.
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completion of preclinical laboratory tests and
in vivo
studies in accordance with the FDA's current Good Laboratory Practice regulations and standards, and other applicable requirements;
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submission to the FDA of an Investigational New Drug application, or IND, for human clinical testing, which must become effective before human clinical trials commence;
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performance of adequate and well-controlled human clinical trials according to the FDA's Good Clinical Practices, or GCP, regulations, and any additional requirements for the protection of human research subjects and their health information, to establish the safety and efficacy of the proposed product candidate for each intended use;
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preparation and submission to the FDA of an application for marketing approval that includes substantial evidence of safety, purity and potency for a biologic, or of safety and efficacy for a non-biologic drug, including from results of nonclinical testing and clinical trials;
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satisfactory completion of an FDA inspection of the manufacturing facility or facilities where the product candidate is produced to assess compliance with current Good Manufacturing Practice, or cGMP, and to assure that the facilities, methods and controls are adequate to preserve the product candidate's identity, safety, strength, quality, potency and purity;
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potential FDA inspection of the nonclinical and clinical trial sites that generated the data in support of the application; and
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FDA review and approval of the application.
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Phase 1
. The product candidate is introduced into healthy human subjects and tested for safety, dosage tolerance, absorption, metabolism, distribution, excretion and, if possible, to gain early understanding of its effectiveness. For some product candidates for severe or life-threatening diseases, especially when the product candidate may be too inherently toxic to ethically administer to healthy volunteers, the initial human testing is often conducted in patients with the targeted disease.
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Phase 2
. The product candidate is administered and evaluated in a limited patient population to identify possible adverse effects and safety risks, to evaluate preliminary efficacy evidence for specific targeted diseases and to determine dosage tolerance, optimal dosage and dosing schedule.
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Phase 3
. The product candidate is administered to an expanded patient population, often at geographically dispersed clinical trial sites, in adequate and well-controlled clinical trials to generate sufficient data to evaluate the safety and
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Item 1A.
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Risk Factors
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progress in our research and development programs, as well as the magnitude of these programs;
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the timing, receipt, and amount of any payments received in connection with strategic transactions;
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the timing, receipt, and amount of upfront, milestone, and other payments, if any, from present and future collaborators, if any;
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the timing, receipt, and amount of sales and royalties, if any, from our potential products;
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our ability to maintain or improve the volume and pricing of our current product and service offerings and to develop new offerings, including those that may incorporate new technologies;
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costs we might incur to reacquire previously licensed rights for our own development;
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the timing and capital requirements to scale up our various product and service offerings and customer acceptance thereof;
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our ability to maintain and establish additional collaborative arrangements and/or new strategic initiatives;
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the timing of regulatory approval of products of our collaborations and operations;
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the resources, time, and cost required for the preparation, filing, prosecution, maintenance, and enforcement of patent claims;
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investments we may make in current and future collaborators, including JVs;
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strategic mergers and acquisitions, including both the upfront acquisition cost as well as the cost to integrate, maintain, and expand the strategic target; and
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the costs associated with legal activities, including litigation, arising in the course of our business activities and our ability to prevail in any such legal disputes.
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our ability to achieve or maintain profitability;
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the feasibility of producing and commercializing products enabled by our technologies;
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our ability to enter into strategic transactions, collaborations, or JVs;
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our relationships, and the associated exclusivity terms, with collaborators and licensees in our target end markets;
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our ability to develop and maintain technologies that our collaborators and licensees continue to use and that new collaborators are seeking;
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obligations to provide resources to our collaborators or to the collaborations themselves pursuant to the terms of the relevant ECC, license agreement or JV agreement;
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our ability to manage our growth;
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the outcomes of research programs, clinical trials, or other product development and approval processes conducted by us and our collaborators and licensees;
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the ability of us and our collaborators and licensees to develop and successfully commercialize products enabled by our technologies;
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our ability to successfully scale up production of our commercial products and customer acceptance thereof;
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risks associated with the international aspects of our business;
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our ability to integrate any businesses or technologies we may acquire with our business;
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our ability to accurately report our financial results in a timely manner;
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our dependence on, and the need to attract and retain, key management and other personnel;
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our ability to obtain, protect and enforce our intellectual property rights;
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our ability to prevent the theft or misappropriation of our intellectual property, know-how or technologies;
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potential advantages that our competitors, the competitors of our collaborators, and potential competitors may have in securing funding or developing competing technologies or products;
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our ability to obtain additional capital that may be necessary to expand our business;
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our collaborators' ability to obtain additional capital that may be necessary to develop and commercialize products under our ECCs, license agreements and JVs;
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business interruptions such as power outages and other natural disasters;
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public concerns about the ethical, legal and social ramifications of GE products and processes;
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the impact of new accounting pronouncements on our current and future operating results;
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our ability to use our net operating loss carryforwards to offset future taxable income; and
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the results of our consolidated subsidiaries.
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issue additional equity securities, which would dilute our current shareholders;
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incur substantial debt to fund the acquisitions; or
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assume significant liabilities.
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problems integrating the purchased operations, facilities, technologies or products;
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unanticipated costs and other liabilities;
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diversion of management's attention from our core businesses;
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adverse effects on existing business relationships with current and/or prospective collaborators, customers and/or suppliers;
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risks associated with entering markets in which we have no or limited prior experience; and
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potential loss of key employees.
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the potential disruption of our ongoing business and diversion of management resources;
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unanticipated expenses related to the acquired operations;
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the impairment of relationships with the acquired customers;
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the impairment of relationships with key suppliers and their ability to meet our demand;
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potential unknown liabilities associated with the acquired business and technology;
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potential liabilities related to litigation involving the acquired companies;
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potential periodic impairment of goodwill and intangible assets acquired; and
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potential inability to retain, integrate and motivate key personnel.
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reduced resources of our management to pursue our business strategy;
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decreased demand for products enabled by our technologies;
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injury to our or our collaborators' reputations and significant negative media attention;
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withdrawal of clinical trial participants;
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initiation of investigations by regulators;
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product recalls, withdrawals or labeling, marketing or promotional restrictions;
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significant costs to defend resulting litigation;
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substantial monetary awards to trial participants or patients;
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loss of revenue; and
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the inability to commercialize any products using our technologies.
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tariffs and trade barriers;
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currency fluctuations, which could decrease our revenues or increase our costs in United States dollars;
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regulations related to customs and import/export matters;
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tax issues, such as tax law changes and variations in tax laws;
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limited access to qualified staff;
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inadequate infrastructure;
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cultural and language differences;
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inadequate banking systems;
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different and/or more stringent environmental laws and regulations;
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restrictions on the repatriation of profits or payment of dividends;
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crime, strikes, riots, civil disturbances, terrorist attacks or wars;
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nationalization or expropriation of property;
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law enforcement authorities and courts that are weak or inexperienced in commercial matters; and
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deterioration of political relations among countries.
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obtaining regulatory approval from the FDA and other regulatory authorities that have very limited experience with the commercial development of genetically modified T-cell therapies for cancer;
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developing and deploying consistent and reliable processes for engineering a patient's T-cells
ex vivo
and infusing the engineered T-cells back into the patient;
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possibly conditioning patients with chemotherapy in conjunction with delivering each of the potential products, which may increase the risk of adverse side effects of the potential products;
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educating medical personnel regarding the potential side effect profile of each of the potential products, such as the potential adverse side effects related to cytokine release;
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developing processes for the safe administration of these potential products, including long-term follow-up for all patients who receive the potential products;
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sourcing additional clinical and, if approved, commercial supplies for the materials used to manufacture and process the potential products;
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developing a manufacturing process and distribution network with a cost of goods that allows for an attractive return on investment;
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establishing sales and marketing capabilities after obtaining any regulatory approval required to gain market access and acceptance;
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developing therapies for types of cancers beyond those addressed by the current potential products;
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not infringing the intellectual property rights, in particular, the patent rights, of third parties, including competitors developing alternative CAR T-cell therapies; and
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avoiding any applicable regulatory barriers to market, such as data and marketing exclusivities held by third parties, including competitors with approved CAR T-cell therapies.
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we have relinquished important rights regarding the commercialization, marketing and distribution of products and we may disagree with our collaborators' plans in these areas;
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although we retain broad rights with respect to intellectual property developed under the ECCs, our collaborators have the right, under certain circumstances, to take control of the enforcement of such intellectual property;
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we may have lower revenues than if we were to develop, manufacture, market and distribute products enabled by our technologies ourselves;
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a collaborator could, without the use of our synthetic biology technologies, develop and market a competing product either independently or in collaboration with others, including our competitors;
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our collaborators could be undercapitalized or fail to secure sufficient resources to fund the development and/or commercialization of the products enabled by our technologies in accordance with the ECC;
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our collaborators could become unable or less willing to expend their resources on research and development or commercialization efforts with respect to our technologies due to general market conditions, their financial condition or other circumstances beyond our control;
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we may be unable to manage multiple simultaneous ECCs or JVs or fulfill our obligations with respect thereto;
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disagreements with a collaborator could develop and any conflict with a collaborator could reduce our ability to enter into future ECCs or JVs and negatively impact our relationships with one or more existing collaborators;
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our collaborators could terminate our ECC or JV with them, in which case, our collaborators may retain rights related to certain products, we may not be able to find another collaborator to develop different products in the field and we may not be able to develop different products in the field ourselves;
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our business could be negatively impacted if any of our collaborators undergo a change of control to a third party who is not willing to work with us on the same terms or commit the same resources as our current collaborator; and
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our collaborators may operate in countries where their operations could be adversely affected by changes in the local regulatory environment or by political unrest.
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complying with these regulations, including seeking approvals, the uncertainty of the scope of future regulations, and the costs of continuing compliance with regulations, could affect our sales and profitability and that of our JVs and collaborators and materially impact our operating results;
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our business could be adversely affected if our processes and those used by our JVs and collaborators to manufacture their final products fail to be approved by the applicable regulatory authorities;
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where products are subject to regulatory approval, the regulatory approval process can be lengthy, costly, time consuming and inherently unpredictable, and if we and our JVs and collaborators are ultimately unable to obtain regulatory approval for products using our technologies, our business will be substantially harmed;
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even if we and our JVs and collaborators are able to commercialize products using our technologies, the product may become subject to post-approval regulatory requirements, unfavorable pricing regulations, third-party payor reimbursement practices or regulatory reform initiatives that could harm our business;
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we and our JVs and collaborators conduct on-going research and development that relies on evaluations in animals, which may become subject to bans or additional regulations;
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compliance with existing or future environmental laws and regulations could have a material adverse impact on the development and commercialization of products using our technologies; and
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to the extent products produced using our technologies are commercialized outside the United States, they will be subject to additional laws and regulations under the jurisdictions in which such products are commercialized.
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stop selling, incorporating or using products that use the intellectual property at issue;
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obtain from the third party asserting its intellectual property rights a license to sell or use the relevant technology, which license may not be available on reasonable terms, if at all; or
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redesign those products or processes that use any allegedly infringing technology, or relocate the operations relating to the allegedly infringing technology to another jurisdiction, which may result in significant cost or delay to us, or that could be technically infeasible.
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announcements of acquisitions, collaborations, financings or other transactions by us;
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public concern as to the safety of our products;
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termination or delay of a development program;
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the recruitment or departure of key personnel; and
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the other factors described in this "Risk Factors" section.
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delay, defer or prevent a change in control;
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entrench our management and/or the board of directors; or
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impede a merger, consolidation, takeover or other business combination involving us that other shareholders may desire.
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a provision allowing our board of directors to issue preferred stock with rights senior to those of the common stock without any vote or action by the holders of our common stock. The issuance of preferred stock could adversely affect the rights and powers, including voting rights, of the holders of common stock;
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establish advance notice requirements for nominations for election to the board of directors or for proposing matters that can be acted on at shareholder meetings;
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the inability of shareholders to convene a shareholders' meeting without the support of shareholders owning together 25 percent of our common stock;
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the application of Virginia law prohibiting us from entering into a business combination with the beneficial owner of 10 percent or more of our outstanding voting stock for a period of three years after the 10 percent or greater owner first reached that level of stock ownership, unless we meet certain criteria;
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allow the authorized number of our directors to be changed only by resolution of our board of directors;
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limit the manner in which shareholders can remove directors from the board;
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require that shareholder actions must be effected at a duly called shareholder meeting and prohibit actions by our shareholders by written consent; and
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limit who may call a special meeting of shareholders.
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Item 1B.
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Unresolved Staff Comments
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Item 2.
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Properties
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Location
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Square Footage
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Germantown, Maryland
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56,258
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South San Francisco, California
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55,609
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Davis, California
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32,867
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San Diego, California
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23,409
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Budapest, Hungary
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18,367
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Ghent, Belgium
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14,198
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Campinas, Brazil
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12,530
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Oxford, England
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10,000
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Item 3.
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Legal Proceedings
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Item 4.
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Mine Safety Disclosures
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Item 5.
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Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
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Company / Index
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Base Period 12/31/2013
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3/31/2014
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6/30/2014
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9/30/2014
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12/31/2014
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||||||||||
Intrexon Corporation
|
|
$
|
100.00
|
|
|
$
|
110.46
|
|
|
$
|
105.59
|
|
|
$
|
78.07
|
|
|
$
|
115.67
|
|
S&P 500 Index
|
|
100.00
|
|
|
101.81
|
|
|
107.14
|
|
|
108.34
|
|
|
113.69
|
|
|||||
NYSE MKT ARCA Biotechnology Index
|
|
100.00
|
|
|
111.02
|
|
|
119.23
|
|
|
132.91
|
|
|
147.91
|
|
|||||
NASDAQ Biotechnology Index
|
|
100.00
|
|
|
104.25
|
|
|
113.51
|
|
|
120.87
|
|
|
134.40
|
|
Company / Index
|
3/31/2015
|
|
6/30/2015
|
|
9/30/2015
|
|
12/31/2015
|
|
3/31/2016
|
|
6/30/2016
|
|
9/30/2016
|
|
12/31/2016
|
||||||||||||||||
Intrexon Corporation
|
$
|
190.63
|
|
|
$
|
205.75
|
|
|
$
|
134.07
|
|
|
$
|
127.12
|
|
|
$
|
142.88
|
|
|
$
|
103.76
|
|
|
$
|
118.14
|
|
|
$
|
102.45
|
|
S&P 500 Index
|
114.77
|
|
|
115.09
|
|
|
107.68
|
|
|
115.26
|
|
|
116.82
|
|
|
119.68
|
|
|
124.29
|
|
|
129.05
|
|
||||||||
NYSE MKT ARCA Biotechnology Index
|
171.66
|
|
|
180.28
|
|
|
147.67
|
|
|
164.76
|
|
|
127.90
|
|
|
130.85
|
|
|
145.91
|
|
|
134.07
|
|
||||||||
NASDAQ Biotechnology Index
|
152.23
|
|
|
163.69
|
|
|
134.34
|
|
|
150.22
|
|
|
115.85
|
|
|
114.54
|
|
|
128.86
|
|
|
118.15
|
|
Company / Index
|
3/31/2017
|
|
6/30/2017
|
|
9/30/2017
|
|
12/31/2017
|
|
3/31/2018
|
|
6/30/2018
|
|
9/30/2018
|
|
12/31/2018
|
||||||||||||||||
Intrexon Corporation
|
$
|
84.42
|
|
|
$
|
102.60
|
|
|
$
|
80.97
|
|
|
$
|
49.07
|
|
|
$
|
65.29
|
|
|
$
|
59.37
|
|
|
$
|
73.34
|
|
|
$
|
27.85
|
|
S&P 500 Index
|
136.88
|
|
|
141.11
|
|
|
147.44
|
|
|
157.24
|
|
|
156.04
|
|
|
161.40
|
|
|
173.85
|
|
|
150.34
|
|
||||||||
NYSE MKT ARCA Biotechnology Index
|
155.55
|
|
|
168.50
|
|
|
183.62
|
|
|
184.59
|
|
|
197.02
|
|
|
208.05
|
|
|
235.73
|
|
|
185.08
|
|
||||||||
NASDAQ Biotechnology Index
|
130.95
|
|
|
138.67
|
|
|
149.41
|
|
|
143.74
|
|
|
143.83
|
|
|
148.26
|
|
|
164.86
|
|
|
131.00
|
|
Item 6.
|
Selected Financial Data
|
|
Year Ended December 31,
|
||||||||||||||||||
|
2018
|
|
2017 (5)
|
|
2016
|
|
2015 (6)
|
|
2014 (7)
|
||||||||||
|
(In thousands, except share and per share amounts)
|
||||||||||||||||||
Statements of Operations Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Collaboration and licensing revenues
|
$
|
76,869
|
|
|
$
|
145,579
|
|
|
$
|
109,871
|
|
|
$
|
87,821
|
|
|
$
|
45,212
|
|
Product revenues
|
28,528
|
|
|
33,589
|
|
|
36,958
|
|
|
41,879
|
|
|
11,481
|
|
|||||
Service revenues
|
52,419
|
|
|
50,611
|
|
|
43,049
|
|
|
42,923
|
|
|
14,761
|
|
|||||
Total revenues (1)
|
160,574
|
|
|
230,981
|
|
|
190,926
|
|
|
173,605
|
|
|
71,930
|
|
|||||
Total operating expenses
|
666,184
|
|
|
368,871
|
|
|
316,092
|
|
|
320,469
|
|
|
141,892
|
|
|||||
Operating loss
|
(505,610
|
)
|
|
(137,890
|
)
|
|
(125,166
|
)
|
|
(146,864
|
)
|
|
(69,962
|
)
|
|||||
Net loss
|
(514,706
|
)
|
|
(126,820
|
)
|
|
(190,274
|
)
|
|
(87,994
|
)
|
|
(85,616
|
)
|
|||||
Net loss attributable to noncontrolling interests
|
5,370
|
|
|
9,802
|
|
|
3,662
|
|
|
3,501
|
|
|
3,794
|
|
|||||
Net loss attributable to Intrexon
|
(509,336
|
)
|
|
(117,018
|
)
|
|
(186,612
|
)
|
|
(84,493
|
)
|
|
(81,822
|
)
|
|||||
Net loss attributable to common shareholders
|
(509,336
|
)
|
|
(117,018
|
)
|
|
(186,612
|
)
|
|
(84,493
|
)
|
|
(81,822
|
)
|
|||||
Net loss attributable to common shareholders per share, basic and diluted
|
$
|
(3.93
|
)
|
|
$
|
(0.98
|
)
|
|
$
|
(1.58
|
)
|
|
$
|
(0.76
|
)
|
|
$
|
(0.83
|
)
|
Weighted average shares outstanding, basic and diluted
|
129,521,731
|
|
|
119,998,826
|
|
|
117,983,836
|
|
|
111,066,352
|
|
|
99,170,653
|
|
|
December 31,
|
||||||||||||||||||
|
2018
|
|
2017 (5)
|
|
2016
|
|
2015 (6)
|
|
2014 (7)
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
102,768
|
|
|
$
|
68,111
|
|
|
$
|
62,607
|
|
|
$
|
135,782
|
|
|
$
|
27,466
|
|
Short-term and long-term investments
|
119,688
|
|
|
6,273
|
|
|
180,595
|
|
|
207,975
|
|
|
115,608
|
|
|||||
Investments in preferred stock (2)
|
191
|
|
|
161,225
|
|
|
129,545
|
|
|
—
|
|
|
—
|
|
|||||
Total assets
|
716,177
|
|
|
846,851
|
|
|
949,068
|
|
|
982,046
|
|
|
576,272
|
|
|||||
Deferred revenue, current and non-current (1)
|
69,764
|
|
|
236,397
|
|
|
310,142
|
|
|
197,729
|
|
|
113,209
|
|
|||||
Long-term debt (3)
|
211,794
|
|
|
8,037
|
|
|
7,948
|
|
|
8,528
|
|
|
10,369
|
|
|||||
Other liabilities (4)
|
55,897
|
|
|
55,872
|
|
|
61,730
|
|
|
70,903
|
|
|
43,405
|
|
|||||
Total Intrexon shareholders' equity
|
362,855
|
|
|
533,631
|
|
|
560,237
|
|
|
694,078
|
|
|
384,761
|
|
|||||
Noncontrolling interests
|
15,867
|
|
|
12,914
|
|
|
9,011
|
|
|
10,808
|
|
|
24,528
|
|
|||||
Total equity
|
378,722
|
|
|
546,545
|
|
|
569,248
|
|
|
704,886
|
|
|
409,289
|
|
(1)
|
Revenues and deferred revenue in 2018 are accounted for under ASC 606, and revenues and deferred revenue prior to 2018 are accounted for under ASC 605,
Revenue Recognition
, or ASC 605. We adopted ASC 606 on January 1, 2018 using the modified retrospective method, which applies the changes in accounting prospectively and does not restate prior periods.
|
(2)
|
In conjunction with the ZIOPHARM License Agreement in 2018, all of our ZIOPHARM preferred shares were returned to ZIOPHARM.
|
(3)
|
In 2018, we completed a registered underwritten public offering of $200,000 aggregate principal amount of Convertible Notes.
|
(4)
|
Other liabilities include
$8,801
,
$15,629
, and
$20,485
of deferred consideration as of
December 31, 2016
,
2015
, and
2014
, respectively.
|
(5)
|
In 2017, we acquired GenVec, Inc., or GenVec, and began including the results of its operations effective on the acquisition date. In 2017, we also acquired the remaining 49 percent of outstanding equity of Biological & Popular Culture, Inc.
|
(6)
|
In 2015, we acquired ActoGeniX NV, Okanagan, and Oxitec and began including the results of their operations effective on the respective acquisition dates.
|
(7)
|
In 2014, we acquired Medistem, Inc. and Trans Ova and began including the results of their operations effective on the respective acquisition dates.
|
Item 7.
|
Management's Discussion and Analysis of Financial Condition and Results of Operations
|
•
|
salaries and benefits, including stock-based compensation expense, for personnel in research and development functions;
|
•
|
fees paid to consultants and contract research organizations who perform research on our behalf and under our direction;
|
•
|
costs related to laboratory supplies used in our research and development efforts;
|
•
|
costs related to certain in-licensed technology rights or reacquired in-process research and development;
|
•
|
depreciation of leasehold improvements and laboratory equipment;
|
•
|
amortization of patents and related technologies acquired in mergers and acquisitions; and
|
•
|
rent and utility costs for our research and development facilities.
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
(In thousands)
|
||||||||||
Expansion or improvement of our platform technologies
|
$
|
19,788
|
|
|
$
|
14,515
|
|
|
$
|
12,195
|
|
Specific applications of our technologies in support of current and prospective partners
|
74,169
|
|
|
77,001
|
|
|
62,960
|
|
|||
Expansion or improvement of our product and service offerings
|
27,331
|
|
|
27,134
|
|
|
17,585
|
|
|||
Other
|
283,298
|
|
|
24,557
|
|
|
19,395
|
|
|||
Total research and development expenses
|
$
|
404,586
|
|
|
$
|
143,207
|
|
|
$
|
112,135
|
|
|
Year Ended
December 31, |
|
Dollar
Change
|
|
Percent
Change
|
|||||||||
|
2018
|
|
2017
|
|
|
|||||||||
|
(In thousands)
|
|
|
|||||||||||
Revenues (1)
|
|
|
|
|
|
|
|
|||||||
Collaboration and licensing revenues (2)
|
$
|
76,869
|
|
|
$
|
145,579
|
|
|
$
|
(68,710
|
)
|
|
(47.2
|
)%
|
Product revenues
|
28,528
|
|
|
33,589
|
|
|
(5,061
|
)
|
|
(15.1
|
)%
|
|||
Service revenues
|
52,419
|
|
|
50,611
|
|
|
1,808
|
|
|
3.6
|
%
|
|||
Other revenues
|
2,758
|
|
|
1,202
|
|
|
1,556
|
|
|
129.5
|
%
|
|||
Total revenues
|
160,574
|
|
|
230,981
|
|
|
(70,407
|
)
|
|
(30.5
|
)%
|
|||
Operating expenses
|
|
|
|
|
|
|
|
|||||||
Cost of products
|
35,698
|
|
|
33,263
|
|
|
2,435
|
|
|
7.3
|
%
|
|||
Cost of services
|
27,589
|
|
|
29,525
|
|
|
(1,936
|
)
|
|
(6.6
|
)%
|
|||
Research and development
|
404,586
|
|
|
143,207
|
|
|
261,379
|
|
|
182.5
|
%
|
|||
Selling, general and administrative
|
137,807
|
|
|
146,103
|
|
|
(8,296
|
)
|
|
(5.7
|
)%
|
|||
Impairment loss
|
60,504
|
|
|
16,773
|
|
|
43,731
|
|
|
>200%
|
|
|||
Total operating expenses
|
666,184
|
|
|
368,871
|
|
|
297,313
|
|
|
80.6
|
%
|
|||
Operating loss
|
(505,610
|
)
|
|
(137,890
|
)
|
|
(367,720
|
)
|
|
>200%
|
|
|||
Total other income (expense), net
|
(19,016
|
)
|
|
22,473
|
|
|
(41,489
|
)
|
|
(184.6
|
)%
|
|||
Equity in loss of affiliates
|
(11,608
|
)
|
|
(14,283
|
)
|
|
2,675
|
|
|
(18.7
|
)%
|
|||
Loss before income taxes
|
(536,234
|
)
|
|
(129,700
|
)
|
|
(406,534
|
)
|
|
>200%
|
|
|||
Income tax benefit
|
21,528
|
|
|
2,880
|
|
|
18,648
|
|
|
>200%
|
|
|||
Net loss
|
(514,706
|
)
|
|
(126,820
|
)
|
|
(387,886
|
)
|
|
>200%
|
|
|||
Net loss attributable to noncontrolling interests
|
5,370
|
|
|
9,802
|
|
|
(4,432
|
)
|
|
(45.2
|
)%
|
|||
Net loss attributable to Intrexon
|
$
|
(509,336
|
)
|
|
$
|
(117,018
|
)
|
|
$
|
(392,318
|
)
|
|
>200%
|
|
(1)
|
Revenues in 2018 are accounted for under ASC 606 and revenues in 2017 are accounted for under ASC 605. We adopted ASC 606 on January 1, 2018 using the modified retrospective method, which applies the changes in accounting prospectively and does not restate prior periods.
|
(2)
|
Including
$60,238
and
$130,670
from related parties for the years ended December 31, 2018 and 2017, respectively.
|
|
Year Ended
December 31, |
|
Dollar
Change
|
||||||||
|
2018
|
|
2017
|
|
|||||||
|
(In thousands)
|
||||||||||
ZIOPHARM Oncology, Inc.
|
$
|
16,298
|
|
|
$
|
69,812
|
|
|
$
|
(53,514
|
)
|
Ares Trading S.A.
|
11,175
|
|
|
10,738
|
|
|
437
|
|
|||
Oragenics, Inc.
|
1,353
|
|
|
2,020
|
|
|
(667
|
)
|
|||
Intrexon T1D Partners, LLC
|
2,502
|
|
|
5,968
|
|
|
(3,466
|
)
|
|||
Intrexon Energy Partners, LLC
|
6,929
|
|
|
10,665
|
|
|
(3,736
|
)
|
|||
Intrexon Energy Partners II, LLC
|
2,998
|
|
|
3,672
|
|
|
(674
|
)
|
|||
Genopaver, LLC
|
3,710
|
|
|
6,690
|
|
|
(2,980
|
)
|
|||
Fibrocell Science, Inc.
|
1,394
|
|
|
7,344
|
|
|
(5,950
|
)
|
|||
Persea Bio, LLC
|
955
|
|
|
946
|
|
|
9
|
|
|||
OvaXon, LLC
|
—
|
|
|
1,966
|
|
|
(1,966
|
)
|
|||
S & I Ophthalmic, LLC
|
—
|
|
|
755
|
|
|
(755
|
)
|
|||
Harvest start-up entities (1)
|
14,447
|
|
|
15,232
|
|
|
(785
|
)
|
|||
Other
|
15,108
|
|
|
9,771
|
|
|
5,337
|
|
|||
Total
|
$
|
76,869
|
|
|
$
|
145,579
|
|
|
$
|
(68,710
|
)
|
(1)
|
For the years ended December 31, 2018 and 2017, revenue recognized from collaborations with Harvest start-up entities include Genten Therapeutics, Inc.; CRS Bio, Inc.; Exotech Bio, Inc.; AD Skincare, Inc.; and Thrive Agrobiotics, Inc. For the year ended December 31, 2017, revenues recognized from collaborations with Harvest start-up entities also include Relieve Genetics, Inc.
|
|
Year Ended
December 31, |
|
Dollar
Change
|
|
Percent
Change
|
|||||||||
|
2017
|
|
2016
|
|
|
|||||||||
|
(In thousands)
|
|
|
|||||||||||
Revenues
|
|
|
|
|
|
|
|
|||||||
Collaboration and licensing revenues (1)
|
$
|
145,579
|
|
|
$
|
109,871
|
|
|
$
|
35,708
|
|
|
32.5
|
%
|
Product revenues
|
33,589
|
|
|
36,958
|
|
|
(3,369
|
)
|
|
(9.1
|
)%
|
|||
Service revenues
|
50,611
|
|
|
43,049
|
|
|
7,562
|
|
|
17.6
|
%
|
|||
Other revenues
|
1,202
|
|
|
1,048
|
|
|
154
|
|
|
14.7
|
%
|
|||
Total revenues
|
230,981
|
|
|
190,926
|
|
|
40,055
|
|
|
21.0
|
%
|
|||
Operating expenses
|
|
|
|
|
|
|
|
|||||||
Cost of products
|
33,263
|
|
|
37,709
|
|
|
(4,446
|
)
|
|
(11.8
|
)%
|
|||
Cost of services
|
29,525
|
|
|
23,930
|
|
|
5,595
|
|
|
23.4
|
%
|
|||
Research and development
|
143,207
|
|
|
112,135
|
|
|
31,072
|
|
|
27.7
|
%
|
|||
Selling, general and administrative
|
146,103
|
|
|
142,318
|
|
|
3,785
|
|
|
2.7
|
%
|
|||
Impairment loss
|
16,773
|
|
|
—
|
|
|
16,773
|
|
|
N/A
|
|
|||
Total operating expenses
|
368,871
|
|
|
316,092
|
|
|
52,779
|
|
|
16.7
|
%
|
|||
Operating loss
|
(137,890
|
)
|
|
(125,166
|
)
|
|
(12,724
|
)
|
|
10.2
|
%
|
|||
Total other income (expense), net
|
22,473
|
|
|
(47,865
|
)
|
|
70,338
|
|
|
147.0
|
%
|
|||
Equity in loss of affiliates
|
(14,283
|
)
|
|
(21,120
|
)
|
|
6,837
|
|
|
(32.4
|
)%
|
|||
Loss before income taxes
|
(129,700
|
)
|
|
(194,151
|
)
|
|
64,451
|
|
|
(33.2
|
)%
|
|||
Income tax benefit
|
2,880
|
|
|
3,877
|
|
|
(997
|
)
|
|
(25.7
|
)%
|
|||
Net loss
|
(126,820
|
)
|
|
(190,274
|
)
|
|
63,454
|
|
|
(33.3
|
)%
|
|||
Net loss attributable to noncontrolling interests
|
9,802
|
|
|
3,662
|
|
|
6,140
|
|
|
167.7
|
%
|
|||
Net loss attributable to Intrexon
|
$
|
(117,018
|
)
|
|
$
|
(186,612
|
)
|
|
$
|
69,594
|
|
|
(37.3
|
)%
|
(1)
|
Including $130,670 and $93,792 from related parties for the years ended December 31, 2017 and 2016, respectively.
|
|
Year Ended
December 31, |
|
Dollar
Change
|
||||||||
|
2017
|
|
2016
|
|
|||||||
|
(In thousands)
|
||||||||||
ZIOPHARM Oncology, Inc.
|
$
|
69,812
|
|
|
$
|
33,836
|
|
|
$
|
35,976
|
|
Ares Trading S.A.
|
10,738
|
|
|
10,192
|
|
|
546
|
|
|||
Oragenics, Inc.
|
2,020
|
|
|
2,752
|
|
|
(732
|
)
|
|||
Intrexon T1D Partners, LLC
|
5,968
|
|
|
1,908
|
|
|
4,060
|
|
|||
Intrexon Energy Partners, LLC
|
10,665
|
|
|
17,552
|
|
|
(6,887
|
)
|
|||
Intrexon Energy Partners II, LLC
|
3,672
|
|
|
3,169
|
|
|
503
|
|
|||
Genopaver, LLC
|
6,690
|
|
|
6,117
|
|
|
573
|
|
|||
Fibrocell Science, Inc.
|
7,344
|
|
|
5,942
|
|
|
1,402
|
|
|||
Persea Bio, LLC
|
946
|
|
|
1,278
|
|
|
(332
|
)
|
|||
OvaXon, LLC
|
1,966
|
|
|
2,934
|
|
|
(968
|
)
|
|||
S & I Ophthalmic, LLC
|
755
|
|
|
6,141
|
|
|
(5,386
|
)
|
|||
Harvest start-up entities (1)
|
15,232
|
|
|
4,974
|
|
|
10,258
|
|
|||
Other
|
9,771
|
|
|
13,076
|
|
|
(3,305
|
)
|
|||
Total
|
$
|
145,579
|
|
|
$
|
109,871
|
|
|
$
|
35,708
|
|
(1)
|
For the years ended December 31, 2017 and 2016, revenue recognized from collaborations with Harvest start-up entities include Genten Therapeutics, Inc.; CRS Bio, Inc.; Relieve Genetics, Inc.; Exotech Bio, Inc.; AD Skincare, Inc.; and Thrive Agrobiotics, Inc.
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
(In thousands)
|
||||||||||
Net cash provided by (used in):
|
|
|
|
|
|
||||||
Operating activities
|
$
|
(124,240
|
)
|
|
$
|
(103,720
|
)
|
|
$
|
(48,988
|
)
|
Investing activities
|
(151,213
|
)
|
|
104,332
|
|
|
(28,392
|
)
|
|||
Financing activities
|
309,795
|
|
|
4,284
|
|
|
12,065
|
|
|||
Effect of exchange rate changes on cash, cash equivalents, and restricted cash
|
295
|
|
|
1,055
|
|
|
(873
|
)
|
|||
Net increase (decrease) in cash, cash equivalents, and restricted cash
|
$
|
34,637
|
|
|
$
|
5,951
|
|
|
$
|
(66,188
|
)
|
•
|
progress in our research and development programs, as well as the magnitude of these programs;
|
•
|
the timing, receipt and amount of any payments received in connection with strategic transactions;
|
•
|
the timing, receipt and amount of upfront, milestone and other payments, if any, from present and future collaborators, if any;
|
•
|
the timing, receipt and amount of sales and royalties, if any, from our potential products;
|
•
|
our ability to maintain or improve the volume and pricing of our current product and service offerings and to develop new offerings, including those that may incorporate new technologies;
|
•
|
costs we might incur to reacquire previously licensed rights for our own development;
|
•
|
the timing and capital requirements to scale up our various product and service offerings and customer acceptance thereof;
|
•
|
our ability to maintain and establish additional collaborative arrangements and/or new strategic initiatives;
|
•
|
the timing of regulatory approval of products of our collaborations and operations;
|
•
|
the resources, time and cost required for the preparation, filing, prosecution, maintenance and enforcement of patent claims;
|
•
|
investments we may make in current and future collaborators, including JVs;
|
•
|
strategic mergers and acquisitions, including both the upfront acquisition cost as well as the cost to integrate, maintain, and expand the strategic target; and
|
•
|
the costs associated with legal activities, including litigation, arising in the course of our business activities and our ability to prevail in any such legal disputes.
|
•
|
shift our internal investments from subsidiaries and platforms whose potential for value creation is longer-term to near-term opportunities;
|
•
|
sell certain of our operating subsidiaries to third parties;
|
•
|
reduce operating expenditures for third-party contractors, including consultants, professional advisors, and other vendors; and
|
•
|
reduce or delay capital expenditures, including non-essential facility expansions, lab equipment, and information technology projects.
|
•
|
maintain the diversity of our various portfolio offerings;
|
•
|
develop and commercialize products within planned timelines or at planned scales; and
|
•
|
invest in new research and development efforts.
|
|
Total
|
|
Less Than 1 Year
|
|
1-3 Years
|
|
3-5 Years
|
|
More Than 5 Years
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Operating leases
|
$
|
77,910
|
|
|
$
|
9,182
|
|
|
$
|
19,037
|
|
|
$
|
15,534
|
|
|
$
|
34,157
|
|
Purchase commitments
|
20,055
|
|
|
9,210
|
|
|
10,845
|
|
|
—
|
|
|
—
|
|
|||||
Convertible debt (1)
|
255,290
|
|
|
—
|
|
|
55,290
|
|
|
200,000
|
|
|
—
|
|
|||||
Cash interest payable on convertible debt
|
31,500
|
|
|
7,000
|
|
|
14,000
|
|
|
10,500
|
|
|
—
|
|
|||||
Long-term debt, excluding convertible debt
|
6,318
|
|
|
559
|
|
|
958
|
|
|
1,862
|
|
|
2,939
|
|
|||||
Contingent consideration
|
585
|
|
|
—
|
|
|
585
|
|
|
—
|
|
|
—
|
|
|||||
Total
|
$
|
391,658
|
|
|
$
|
25,951
|
|
|
$
|
100,715
|
|
|
$
|
227,896
|
|
|
$
|
37,096
|
|
(1)
|
The convertible debt may be converted to Intrexon common stock or to the common stock of one of our subsidiaries.
|
•
|
The consideration is commensurate with either the entity's performance to achieve the milestone or the enhancement of the value of the delivered item or items as a result of a specific outcome resulting from the entity's performance to achieve the milestone;
|
•
|
The consideration relates solely to past performance; and
|
•
|
The consideration is reasonable relative to all of the deliverables and payment terms within the arrangement.
|
Item 7A.
|
Quantitative and Qualitative Disclosures About Market Risk
|
Item 8.
|
Financial Statements and Supplementary Data
|
Item 9.
|
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
|
Item 9A.
|
Controls and Procedures
|
(i)
|
pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets;
|
(ii)
|
provide reasonable assurance that transactions are recorded as necessary to permit preparation of consolidated financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and
|
(iii)
|
provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the consolidated financial statements.
|
Item 9B.
|
Other Information
|
Item 10.
|
Directors, Executive Officers and Corporate Governance
|
Item 11.
|
Executive Compensation
|
Item 12.
|
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
|
Item 13.
|
Certain Relationships and Related Transactions, and Director Independence
|
Item 14.
|
Principal Accounting Fees and Services
|
Item 15.
|
Exhibits, Financial Statement Schedules
|
(a)
|
The following consolidated financial statements of Intrexon Corporation and its subsidiaries, and the independent registered public accounting firm reports thereon, are included in Part II, Item 8 of this Annual Report:
|
1.
|
Financial Statements
.
|
2.
|
Financial Statement Schedules
.
|
3.
|
Exhibits
.
|
(b)
|
Exhibits
|
Exhibit No.
|
|
Description
|
|
|
|
||
1.1*
|
|
|
|
|
|
|
|
2.1*
|
|
|
|
|
|
||
3.1*
|
|
|
|
|
|
||
3.1A*
|
|
|
|
|
|
||
3.2*
|
|
|
|
|
|
||
4.1*
|
|
|
|
|
|
||
4.2*
|
|
|
|
|
|
||
4.3*
|
|
|
|
|
|
4.4*
|
|
|
|
|
|
||
4.5*
|
|
|
|
|
|
||
10.1†*
|
|
|
|
|
|
||
10.2†*
|
|
|
|
|
|
||
10.2A†*
|
|
|
|
|
|
||
10.2B†*
|
|
|
|
|
|
||
10.2C†*
|
|
|
|
|
|
||
10.2D†*
|
|
|
|
|
|
||
10.2E†*
|
|
|
|
|
|
||
10.2F†*
|
|
|
|
|
|
||
10.2G†*
|
|
|
|
|
|
||
10.2H†*
|
|
|
|
|
|
||
10.2I†*
|
|
|
|
|
|
||
10.2J†*
|
|
|
|
|
|
||
10.2K†*
|
|
|
|
|
|
||
10.2L†*
|
|
|
|
|
|
||
10.2M†*
|
|
|
|
|
|
||
10.2N†*
|
|
|
|
|
|
||
10.3*
|
|
|
|
|
|
|
|
10.3A*
|
|
|
|
|
|
||
10.3B*
|
|
|
|
|
|
||
10.3C*
|
|
|
|
|
|
||
10.4#*
|
|
|
|
|
|
||
10.5*
|
|
|
|
|
|
||
10.6#*
|
|
|
|
|
||
10.7†*
|
|
|
|
|
|
||
10.8#*
|
|
|
|
|
|
||
10.9#*
|
|
|
|
|
|
||
10.10*
|
|
|
|
|
|
||
10.11*
|
|
|
|
|
|
||
10.12*
|
|
|
|
|
|
||
10.13*
|
|
|
|
|
|
||
10.14#*
|
|
|
|
|
|
||
10.15#*
|
|
|
|
|
|
||
10.16#*
|
|
|
|
|
|
||
10.17†*
|
|
|
|
|
|
||
10.18*
|
|
|
|
|
|
||
10.18A*
|
|
|
|
|
|
||
10.18B*
|
|
|
|
|
|
||
10.18C*
|
|
|
|
|
|
||
10.19*
|
|
|
|
|
|
||
10.20†*
|
|
|
|
|
|
||
10.21†*
|
|
|
|
|
|
||
10.22#**
|
|
|
|
|
|
||
10.23#**
|
|
|
|
|
|
||
21.1
|
|
|
|
|
|
||
23.1
|
|
|
|
|
|
||
31.1
|
|
|
|
|
|
||
31.2
|
|
|
|
|
|
32.1**
|
|
|
|
|
|
||
32.2**
|
|
|
|
|
|
||
101**
|
|
|
Interactive Data File (Intrexon Corporation and Subsidiaries Consolidated Financial Statements for the years ended December 31, 2018, 2017 and 2016, formatted in XBRL (eXtensible Business Reporting Language)).
|
|
|
||
|
|
Attached as Exhibit 101 are the following documents formatted in XBRL: (i) the Consolidated Balance Sheets as of December 31, 2018 and 2017, (ii) the Consolidated Statements of Operations for the years ended December 31, 2018, 2017 and 2016, (iii) the Consolidated Statements of Shareholders' and Total Equity for the years ended December 31, 2018, 2017 and 2016, (iv) the Consolidated Statements of Cash Flows for the years ended December 31, 2018, 2017 and 2016 and (v) the Notes to the Consolidated Financial Statements.
|
*
|
Previously filed and incorporated by reference to the exhibit indicated in the following filings by Intrexon:
|
(1)
|
Registration Statement on Form S-1, filed with the Securities and Exchange Commission on July 9, 2013.
|
(2)
|
Amendment No. 1 to Registration Statement on Form S-1, filed with the Securities and Exchange Commission on July 29, 2013.
|
(3)
|
Current Report on Form 8-K, filed with the Securities and Exchange Commission on August 15, 2013.
|
(4)
|
Current Report on Form 8-K/A, filed with the Securities and Exchange Commission on April 4, 2014.
|
(5)
|
Current Report on Form 8-K, filed with the Securities and Exchange Commission on January 14, 2015.
|
(6)
|
Current Report on Form 8-K/A, filed with the Securities and Exchange Commission on January 28, 2015.
|
(7)
|
Current Report on Form 8-K, filed with the Securities and Exchange Commission on June 13, 2014.
|
(8)
|
Current Report on Form 8-K, filed with the Securities and Exchange Commission on April 2, 2015.
|
(9)
|
Current Report on Form 8-K, filed with the Securities and Exchange Commission on June 17, 2015.
|
(10)
|
Current Report on Form 8-K/A, filed with the Securities and Exchange Commission on November 3, 2015.
|
(11)
|
Current Report on Form 8-K, filed with the Securities and Exchange Commission on November 12, 2015.
|
(12)
|
Current Report on Form 8-K, filed with the Securities and Exchange Commission on March 14, 2016.
|
(13)
|
Current Report on Form 8-K, filed with the Securities and Exchange Commission on June 13, 2016.
|
(14)
|
Current Report on Form 8-K, filed with the Securities and Exchange Commission on June 30, 2016.
|
(15)
|
Current Report on Form 8-K, filed with the Securities and Exchange Commission on November 3, 2016.
|
(16)
|
Current Report on Form 8-K, filed with the Securities and Exchange Commission on December 30, 2016.
|
(17)
|
Current Report on Form 8-K, filed with the Securities and Exchange Commission on March 31, 2017.
|
(18)
|
Amendment No. 2 to the Registration Statement on Form S-4, filed with the Securities and Exchange Commission on May 11, 2017.
|
(19)
|
Current Report on Form 8-K, filed with the Securities and Exchange Commission on June 30, 2017.
|
(20)
|
Current Report on Form 8-K, filed with the Securities and Exchange Commission on October 16, 2017.
|
(21)
|
Quarterly Report on Form 10-Q, filed with the Securities and Exchange Commission on November 9, 2017.
|
(22)
|
Current Report on Form 8-K, filed with the Securities and Exchange Commission on January 2, 2018.
|
(23)
|
Annual Report on Form 10-K, filed with the Securities and Exchange Commission on March 1, 2018.
|
(24)
|
Current Report on Form 8-K, filed with the Securities and Exchange Commission on April 5, 2018.
|
(25)
|
Current Report on Form 8-K, filed with the Securities and Exchange Commission on June 8, 2018.
|
(26)
|
Current Report on Form 8-K, filed with the Securities and Exchange Commission on July 3, 2018.
|
(27)
|
Quarterly Report on Form 10-Q, filed with the Securities and Exchange Commission on November 8, 2018.
|
**
|
Furnished herewith
|
†
|
Indicates management contract or compensatory plan.
|
#
|
Portions of the exhibit (indicated by asterisks) have been omitted pursuant to a confidential treatment order granted by the Securities and Exchange Commission.
|
(c)
|
Financial Statement Schedules
|
Item 16.
|
Form 10-K Summary
|
INTREXON CORPORATION
|
||
|
|
|
|
By:
|
/S/ RANDAL J. KIRK
|
|
|
Randal J. Kirk
Chief Executive Officer and Chairman of the Board of Directors
|
|
|
|
|
|
Signature
|
|
Title
|
|
Date
|
|
|
|
||
/S/ RANDAL J. KIRK
|
|
Chief Executive Officer and
Chairman of the Board of Directors
(Principal Executive Officer)
|
|
3/1/2019
|
Randal J. Kirk
|
|
|
|
|
|
|
|
||
/S/ RICK L. STERLING
|
|
Chief Financial Officer
(Principal Accounting and Financial Officer)
|
|
3/1/2019
|
Rick L. Sterling
|
|
|
|
|
|
|
|
||
/S/ CESAR L. ALVAREZ
|
|
Director
|
|
2/28/2019
|
Cesar L. Alvarez
|
|
|
|
|
|
|
|
||
/S/ STEVEN FRANK
|
|
Director
|
|
2/28/2019
|
Steven Frank
|
|
|
|
|
|
|
|
||
/S/ VINITA D. GUPTA
|
|
Director
|
|
2/28/2019
|
Vinita D. Gupta
|
|
|
|
|
|
|
|
||
/S/ FRED HASSAN
|
|
Director
|
|
2/28/2019
|
Fred Hassan
|
|
|
|
|
|
|
|
||
/S/ JEFFREY B. KINDLER
|
|
Director
|
|
2/28/2019
|
Jeffrey B. Kindler
|
|
|
|
|
|
|
|
||
/S/ DEAN J. MITCHELL
|
|
Director
|
|
2/28/2019
|
Dean J. Mitchell
|
|
|
|
|
|
|
|
||
/S/ ROBERT B. SHAPIRO
|
|
Director
|
|
2/28/2019
|
Robert B. Shapiro
|
|
|
|
|
|
|
|
||
/S/ JAMES S. TURLEY
|
|
Director
|
|
2/28/2019
|
James S. Turley
|
|
|
|
|
|
Page(s)
|
(Amounts in thousands, except share data)
|
2018
|
|
2017
|
||||
Assets
|
|
|
|
||||
Current assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
102,768
|
|
|
$
|
68,111
|
|
Restricted cash
|
6,987
|
|
|
6,987
|
|
||
Short-term investments
|
119,688
|
|
|
6,273
|
|
||
Equity securities
|
384
|
|
|
5,285
|
|
||
Receivables
|
|
|
|
||||
Trade, net
|
21,195
|
|
|
19,775
|
|
||
Related parties, net
|
4,129
|
|
|
17,913
|
|
||
Other, net
|
2,754
|
|
|
2,153
|
|
||
Inventory
|
21,447
|
|
|
20,493
|
|
||
Prepaid expenses and other
|
6,131
|
|
|
7,057
|
|
||
Total current assets
|
285,483
|
|
|
154,047
|
|
||
Equity securities, noncurrent
|
1,798
|
|
|
9,815
|
|
||
Investments in preferred stock
|
191
|
|
|
161,225
|
|
||
Property, plant and equipment, net
|
128,874
|
|
|
112,674
|
|
||
Intangible assets, net
|
129,291
|
|
|
232,877
|
|
||
Goodwill
|
149,585
|
|
|
153,289
|
|
||
Investments in affiliates
|
18,859
|
|
|
18,870
|
|
||
Other assets
|
2,096
|
|
|
4,054
|
|
||
Total assets
|
$
|
716,177
|
|
|
$
|
846,851
|
|
(Amounts in thousands, except share data)
|
2018
|
|
2017
|
||||
Liabilities and Total Equity
|
|
|
|
||||
Current liabilities
|
|
|
|
||||
Accounts payable
|
$
|
13,420
|
|
|
$
|
8,701
|
|
Accrued compensation and benefits
|
10,687
|
|
|
6,474
|
|
||
Other accrued liabilities
|
20,620
|
|
|
21,080
|
|
||
Deferred revenue, including $6,945 and $29,155 from related parties as of December 31, 2018 and 2017, respectively
|
15,554
|
|
|
42,870
|
|
||
Lines of credit
|
466
|
|
|
233
|
|
||
Current portion of long-term debt
|
559
|
|
|
502
|
|
||
Related party payables
|
256
|
|
|
313
|
|
||
Total current liabilities
|
61,562
|
|
|
80,173
|
|
||
Long-term debt, net of current portion, including $55,290 to related parties as of December 31, 2018
|
211,235
|
|
|
7,535
|
|
||
Deferred revenue, net of current portion, including $52,227 and $157,628 from related parties as of December 31, 2018 and 2017, respectively
|
54,210
|
|
|
193,527
|
|
||
Deferred tax liabilities, net
|
7,213
|
|
|
15,620
|
|
||
Other long-term liabilities
|
3,235
|
|
|
3,451
|
|
||
Total liabilities
|
337,455
|
|
|
300,306
|
|
||
Commitments and contingencies (Note 16)
|
|
|
|
||||
Total equity
|
|
|
|
||||
Common stock, no par value, 200,000,000 shares authorized as of December 31, 2018 and 2017; and 160,020,466 shares and 122,087,040 shares issued and outstanding as of December 31, 2018 and 2017, respectively
|
—
|
|
|
—
|
|
||
Additional paid-in capital
|
1,722,012
|
|
|
1,397,005
|
|
||
Accumulated deficit
|
(1,330,545
|
)
|
|
(847,820
|
)
|
||
Accumulated other comprehensive loss
|
(28,612
|
)
|
|
(15,554
|
)
|
||
Total Intrexon shareholders' equity
|
362,855
|
|
|
533,631
|
|
||
Noncontrolling interests
|
15,867
|
|
|
12,914
|
|
||
Total equity
|
378,722
|
|
|
546,545
|
|
||
Total liabilities and total equity
|
$
|
716,177
|
|
|
$
|
846,851
|
|
(Amounts in thousands, except share and per share data)
|
2018
|
|
2017
|
|
2016
|
||||||
Revenues
|
|
|
|
|
|
||||||
Collaboration and licensing revenues, including $60,238, $130,670, and $93,792 from related parties in 2018, 2017, and 2016, respectively
|
$
|
76,869
|
|
|
$
|
145,579
|
|
|
$
|
109,871
|
|
Product revenues
|
28,528
|
|
|
33,589
|
|
|
36,958
|
|
|||
Service revenues
|
52,419
|
|
|
50,611
|
|
|
43,049
|
|
|||
Other revenues
|
2,758
|
|
|
1,202
|
|
|
1,048
|
|
|||
Total revenues
|
160,574
|
|
|
230,981
|
|
|
190,926
|
|
|||
Operating Expenses
|
|
|
|
|
|
||||||
Cost of products
|
35,698
|
|
|
33,263
|
|
|
37,709
|
|
|||
Cost of services
|
27,589
|
|
|
29,525
|
|
|
23,930
|
|
|||
Research and development
|
404,586
|
|
|
143,207
|
|
|
112,135
|
|
|||
Selling, general and administrative
|
137,807
|
|
|
146,103
|
|
|
142,318
|
|
|||
Impairment loss
|
60,504
|
|
|
16,773
|
|
|
—
|
|
|||
Total operating expenses
|
666,184
|
|
|
368,871
|
|
|
316,092
|
|
|||
Operating loss
|
(505,610
|
)
|
|
(137,890
|
)
|
|
(125,166
|
)
|
|||
Other Income (Expense), Net
|
|
|
|
|
|
||||||
Unrealized and realized appreciation (depreciation) in fair value of equity securities and preferred stock
|
(30,200
|
)
|
|
2,586
|
|
|
(58,894
|
)
|
|||
Interest expense
|
(8,530
|
)
|
|
(611
|
)
|
|
(861
|
)
|
|||
Interest and dividend income
|
19,084
|
|
|
19,485
|
|
|
10,190
|
|
|||
Other income, net
|
630
|
|
|
1,013
|
|
|
1,700
|
|
|||
Total other income (expense), net
|
(19,016
|
)
|
|
22,473
|
|
|
(47,865
|
)
|
|||
Equity in net loss of affiliates
|
(11,608
|
)
|
|
(14,283
|
)
|
|
(21,120
|
)
|
|||
Loss before income taxes
|
(536,234
|
)
|
|
(129,700
|
)
|
|
(194,151
|
)
|
|||
Income tax benefit
|
21,528
|
|
|
2,880
|
|
|
3,877
|
|
|||
Net loss
|
$
|
(514,706
|
)
|
|
$
|
(126,820
|
)
|
|
$
|
(190,274
|
)
|
Net loss attributable to the noncontrolling interests
|
5,370
|
|
|
9,802
|
|
|
3,662
|
|
|||
Net loss attributable to Intrexon
|
$
|
(509,336
|
)
|
|
$
|
(117,018
|
)
|
|
$
|
(186,612
|
)
|
Net loss attributable to Intrexon per share, basic and diluted
|
$
|
(3.93
|
)
|
|
$
|
(0.98
|
)
|
|
$
|
(1.58
|
)
|
Weighted average shares outstanding, basic and diluted
|
129,521,731
|
|
|
119,998,826
|
|
|
117,983,836
|
|
(Amounts in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Net loss
|
$
|
(514,706
|
)
|
|
$
|
(126,820
|
)
|
|
$
|
(190,274
|
)
|
Other comprehensive income (loss):
|
|
|
|
|
|
||||||
Unrealized gain (loss) on investments
|
(59
|
)
|
|
87
|
|
|
430
|
|
|||
Gain (loss) on foreign currency translation adjustments
|
(13,073
|
)
|
|
20,599
|
|
|
(23,901
|
)
|
|||
Comprehensive loss
|
(527,838
|
)
|
|
(106,134
|
)
|
|
(213,745
|
)
|
|||
Comprehensive loss attributable to the noncontrolling interests
|
5,548
|
|
|
9,764
|
|
|
3,683
|
|
|||
Comprehensive loss attributable to Intrexon
|
$
|
(522,290
|
)
|
|
$
|
(96,370
|
)
|
|
$
|
(210,062
|
)
|
(Amounts in thousands, except share data)
|
Common Stock
|
|
Additional
Paid-in
Capital
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Accumulated
Deficit
|
|
Total
Intrexon Shareholders' Equity |
|
Noncontrolling
Interests
|
|
Total
Equity
|
|||||||||||||||||
Shares
|
|
Amount
|
|
|||||||||||||||||||||||||||
Balances at December 31, 2015
|
116,658,886
|
|
|
$
|
—
|
|
|
$
|
1,249,559
|
|
|
$
|
(12,752
|
)
|
|
$
|
(542,729
|
)
|
|
$
|
694,078
|
|
|
$
|
10,808
|
|
|
$
|
704,886
|
|
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
42,108
|
|
|
—
|
|
|
—
|
|
|
42,108
|
|
|
73
|
|
|
42,181
|
|
|||||||
Exercises of stock options and warrants
|
1,400,146
|
|
|
—
|
|
|
19,165
|
|
|
—
|
|
|
—
|
|
|
19,165
|
|
|
—
|
|
|
19,165
|
|
|||||||
Shares issued as payment for services
|
434,061
|
|
|
—
|
|
|
10,777
|
|
|
—
|
|
|
—
|
|
|
10,777
|
|
|
—
|
|
|
10,777
|
|
|||||||
Shares issued in asset acquisition
|
136,340
|
|
|
—
|
|
|
4,401
|
|
|
—
|
|
|
—
|
|
|
4,401
|
|
|
—
|
|
|
4,401
|
|
|||||||
Shares issued as payment for contingent consideration
|
59,337
|
|
|
—
|
|
|
1,583
|
|
|
—
|
|
|
—
|
|
|
1,583
|
|
|
—
|
|
|
1,583
|
|
|||||||
Acquisition of noncontrolling interest
|
—
|
|
|
—
|
|
|
(1,813
|
)
|
|
—
|
|
|
—
|
|
|
(1,813
|
)
|
|
1,813
|
|
|
—
|
|
|||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(186,612
|
)
|
|
(186,612
|
)
|
|
(3,662
|
)
|
|
(190,274
|
)
|
|||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(23,450
|
)
|
|
—
|
|
|
(23,450
|
)
|
|
(21
|
)
|
|
(23,471
|
)
|
|||||||
Balances at December 31, 2016
|
118,688,770
|
|
|
$
|
—
|
|
|
$
|
1,325,780
|
|
|
$
|
(36,202
|
)
|
|
$
|
(729,341
|
)
|
|
$
|
560,237
|
|
|
$
|
9,011
|
|
|
$
|
569,248
|
|
(Amounts in thousands, except share data)
|
Common Stock
|
|
Additional
Paid-in
Capital
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Accumulated
Deficit
|
|
Total
Intrexon Shareholders' Equity |
|
Noncontrolling
Interests
|
|
Total
Equity
|
|||||||||||||||||
Shares
|
|
Amount
|
|
|||||||||||||||||||||||||||
Balances at December 31, 2016
|
118,688,770
|
|
|
$
|
—
|
|
|
$
|
1,325,780
|
|
|
$
|
(36,202
|
)
|
|
$
|
(729,341
|
)
|
|
$
|
560,237
|
|
|
$
|
9,011
|
|
|
$
|
569,248
|
|
Cumulative effect of adoption of ASU 2016-09
|
—
|
|
|
—
|
|
|
1,461
|
|
|
—
|
|
|
(1,461
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
41,525
|
|
|
—
|
|
|
—
|
|
|
41,525
|
|
|
51
|
|
|
41,576
|
|
|||||||
Exercises of stock options and warrants
|
149,429
|
|
|
—
|
|
|
952
|
|
|
—
|
|
|
—
|
|
|
952
|
|
|
28
|
|
|
980
|
|
|||||||
Shares issued as payment for services
|
654,456
|
|
|
—
|
|
|
11,118
|
|
|
—
|
|
|
—
|
|
|
11,118
|
|
|
—
|
|
|
11,118
|
|
|||||||
Shares issued in private placement
|
1,207,980
|
|
|
—
|
|
|
13,686
|
|
|
—
|
|
|
—
|
|
|
13,686
|
|
|
—
|
|
|
13,686
|
|
|||||||
Shares and warrants issued in business combination
|
684,240
|
|
|
—
|
|
|
16,997
|
|
|
—
|
|
|
—
|
|
|
16,997
|
|
|
—
|
|
|
16,997
|
|
|||||||
Acquisitions of noncontrolling interests
|
221,743
|
|
|
—
|
|
|
5,082
|
|
|
—
|
|
|
—
|
|
|
5,082
|
|
|
(5,995
|
)
|
|
(913
|
)
|
|||||||
Shares issued as payment of deferred consideration
|
480,422
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Adjustments for noncontrolling interests
|
—
|
|
|
—
|
|
|
2,789
|
|
|
—
|
|
|
—
|
|
|
2,789
|
|
|
(2,802
|
)
|
|
(13
|
)
|
|||||||
Noncash dividend
|
—
|
|
|
—
|
|
|
(22,385
|
)
|
|
—
|
|
|
—
|
|
|
(22,385
|
)
|
|
22,385
|
|
|
—
|
|
|||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(117,018
|
)
|
|
(117,018
|
)
|
|
(9,802
|
)
|
|
(126,820
|
)
|
|||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
20,648
|
|
|
—
|
|
|
20,648
|
|
|
38
|
|
|
20,686
|
|
|||||||
Balances at December 31, 2017
|
122,087,040
|
|
|
$
|
—
|
|
|
$
|
1,397,005
|
|
|
$
|
(15,554
|
)
|
|
$
|
(847,820
|
)
|
|
$
|
533,631
|
|
|
$
|
12,914
|
|
|
$
|
546,545
|
|
(Amounts in thousands, except share data)
|
Common Stock
|
|
Additional
Paid-in
Capital
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Accumulated
Deficit
|
|
Total
Intrexon Shareholders' Equity |
|
Noncontrolling
Interests
|
|
Total
Equity
|
|||||||||||||||||
Shares
|
|
Amount
|
|
|||||||||||||||||||||||||||
Balances at December 31, 2017
|
122,087,040
|
|
|
$
|
—
|
|
|
$
|
1,397,005
|
|
|
$
|
(15,554
|
)
|
|
$
|
(847,820
|
)
|
|
$
|
533,631
|
|
|
$
|
12,914
|
|
|
$
|
546,545
|
|
Cumulative effect of adoption of ASC 606
|
—
|
|
|
—
|
|
|
—
|
|
|
(104
|
)
|
|
26,611
|
|
|
26,507
|
|
|
—
|
|
|
26,507
|
|
|||||||
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
36,174
|
|
|
—
|
|
|
—
|
|
|
36,174
|
|
|
122
|
|
|
36,296
|
|
|||||||
Shares issued upon vesting of restricted stock units and for exercises of stock options and warrants
|
70,159
|
|
|
—
|
|
|
297
|
|
|
—
|
|
|
—
|
|
|
297
|
|
|
2,039
|
|
|
2,336
|
|
|||||||
Shares issued as payment for services
|
909,980
|
|
|
—
|
|
|
10,695
|
|
|
—
|
|
|
—
|
|
|
10,695
|
|
|
—
|
|
|
10,695
|
|
|||||||
Shares and warrants issued in public offerings, net of issuance costs
|
6,900,000
|
|
|
—
|
|
|
82,374
|
|
|
—
|
|
|
—
|
|
|
82,374
|
|
|
5,616
|
|
|
87,990
|
|
|||||||
Equity component of convertible debt, net of issuance costs and deferred taxes
|
—
|
|
|
—
|
|
|
36,868
|
|
|
—
|
|
|
—
|
|
|
36,868
|
|
|
—
|
|
|
36,868
|
|
|||||||
Shares issued pursuant to share lending agreement
|
7,479,431
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Shares issued for reacquired in-process research and development
|
22,573,856
|
|
|
—
|
|
|
159,323
|
|
|
—
|
|
|
—
|
|
|
159,323
|
|
|
—
|
|
|
159,323
|
|
|||||||
Adjustments for noncontrolling interests
|
—
|
|
|
—
|
|
|
(724
|
)
|
|
—
|
|
|
—
|
|
|
(724
|
)
|
|
724
|
|
|
—
|
|
|||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(509,336
|
)
|
|
(509,336
|
)
|
|
(5,370
|
)
|
|
(514,706
|
)
|
|||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(12,954
|
)
|
|
—
|
|
|
(12,954
|
)
|
|
(178
|
)
|
|
(13,132
|
)
|
|||||||
Balances at December 31, 2018
|
160,020,466
|
|
|
$
|
—
|
|
|
$
|
1,722,012
|
|
|
$
|
(28,612
|
)
|
|
$
|
(1,330,545
|
)
|
|
$
|
362,855
|
|
|
$
|
15,867
|
|
|
$
|
378,722
|
|
(Amounts in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Cash flows from operating activities
|
|
|
|
|
|
||||||
Net loss
|
$
|
(514,706
|
)
|
|
$
|
(126,820
|
)
|
|
$
|
(190,274
|
)
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
33,112
|
|
|
31,145
|
|
|
24,572
|
|
|||
Loss on abandonment and disposal of assets, net
|
20,928
|
|
|
3,124
|
|
|
666
|
|
|||
Impairment loss
|
60,504
|
|
|
16,773
|
|
|
—
|
|
|||
Reacquisition of in-process research and development
|
236,748
|
|
|
—
|
|
|
—
|
|
|||
Unrealized and realized (appreciation) depreciation on equity securities and preferred stock, net
|
30,200
|
|
|
(2,586
|
)
|
|
58,894
|
|
|||
Noncash dividend income
|
(14,841
|
)
|
|
(16,756
|
)
|
|
(7,421
|
)
|
|||
Amortization of premiums (discounts) on investments, net
|
(771
|
)
|
|
411
|
|
|
1,070
|
|
|||
Equity in net loss of affiliates
|
11,608
|
|
|
14,283
|
|
|
21,120
|
|
|||
Stock-based compensation expense
|
36,296
|
|
|
41,576
|
|
|
42,202
|
|
|||
Shares issued as payment for services
|
10,695
|
|
|
11,118
|
|
|
10,777
|
|
|||
Provision for bad debts
|
1,779
|
|
|
1,217
|
|
|
1,963
|
|
|||
Accretion of debt discount and amortization of deferred financing costs
|
4,378
|
|
|
—
|
|
|
—
|
|
|||
Deferred income taxes
|
(21,278
|
)
|
|
(2,528
|
)
|
|
(3,467
|
)
|
|||
Other noncash items
|
1,093
|
|
|
(517
|
)
|
|
1,662
|
|
|||
Changes in operating assets and liabilities:
|
|
|
|
|
|
||||||
Receivables:
|
|
|
|
|
|
||||||
Trade
|
(2,698
|
)
|
|
740
|
|
|
2,588
|
|
|||
Related parties
|
11,003
|
|
|
631
|
|
|
6,804
|
|
|||
Notes
|
—
|
|
|
—
|
|
|
(42
|
)
|
|||
Other
|
(542
|
)
|
|
661
|
|
|
271
|
|
|||
Inventory
|
(478
|
)
|
|
663
|
|
|
3,807
|
|
|||
Prepaid expenses and other
|
1,006
|
|
|
492
|
|
|
(932
|
)
|
|||
Other assets
|
652
|
|
|
(1,017
|
)
|
|
2,189
|
|
|||
Accounts payable
|
4,680
|
|
|
(3,402
|
)
|
|
3,618
|
|
|||
Accrued compensation and benefits
|
4,385
|
|
|
(1,466
|
)
|
|
(12,402
|
)
|
|||
Other accrued liabilities
|
356
|
|
|
3,007
|
|
|
9,002
|
|
|||
Deferred revenue
|
(38,578
|
)
|
|
(75,337
|
)
|
|
(25,481
|
)
|
|||
Deferred consideration
|
—
|
|
|
(313
|
)
|
|
(630
|
)
|
|||
Related party payables
|
(52
|
)
|
|
(147
|
)
|
|
310
|
|
|||
Other long-term liabilities
|
281
|
|
|
1,328
|
|
|
146
|
|
|||
Net cash used in operating activities
|
(124,240
|
)
|
|
(103,720
|
)
|
|
(48,988
|
)
|
(Amounts in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Cash flows from investing activities
|
|
|
|
|
|
||||||
Purchases of investments
|
(178,681
|
)
|
|
—
|
|
|
(75,246
|
)
|
|||
Maturities of investments
|
65,975
|
|
|
174,542
|
|
|
101,987
|
|
|||
Purchases of equity securities, preferred stock, and warrants
|
—
|
|
|
(1,161
|
)
|
|
(2,308
|
)
|
|||
Proceeds from sales of equity securities
|
217
|
|
|
235
|
|
|
280
|
|
|||
Acquisitions of businesses, net of cash received
|
(920
|
)
|
|
2,054
|
|
|
—
|
|
|||
Investments in affiliates
|
(16,582
|
)
|
|
(11,189
|
)
|
|
(11,542
|
)
|
|||
Return of investment in affiliate
|
2,598
|
|
|
—
|
|
|
—
|
|
|||
Cash received (paid) in asset acquisitions
|
15,500
|
|
|
(14,219
|
)
|
|
(7,244
|
)
|
|||
Purchases of property, plant and equipment
|
(41,587
|
)
|
|
(46,666
|
)
|
|
(31,629
|
)
|
|||
Proceeds from sale of assets
|
2,267
|
|
|
1,636
|
|
|
274
|
|
|||
Issuances of notes receivable
|
—
|
|
|
(2,400
|
)
|
|
(2,964
|
)
|
|||
Proceeds from repayment of notes receivable
|
—
|
|
|
1,500
|
|
|
—
|
|
|||
Net cash provided by (used in) investing activities
|
(151,213
|
)
|
|
104,332
|
|
|
(28,392
|
)
|
|||
Cash flows from financing activities
|
|
|
|
|
|
||||||
Proceeds from issuance of shares in a private placement
|
—
|
|
|
13,686
|
|
|
—
|
|
|||
Proceeds from issuance of shares and warrants in public offerings, net of issuance costs
|
87,990
|
|
|
—
|
|
|
—
|
|
|||
Acquisitions of noncontrolling interests
|
—
|
|
|
(913
|
)
|
|
—
|
|
|||
Advances from lines of credit
|
4,561
|
|
|
5,906
|
|
|
5,075
|
|
|||
Repayments of advances from lines of credit
|
(4,328
|
)
|
|
(6,493
|
)
|
|
(4,816
|
)
|
|||
Proceeds from long-term debt, net of issuance costs
|
219,859
|
|
|
325
|
|
|
547
|
|
|||
Payments of long-term debt
|
(623
|
)
|
|
(519
|
)
|
|
(1,201
|
)
|
|||
Payments of deferred consideration for acquisitions
|
—
|
|
|
(8,678
|
)
|
|
(6,705
|
)
|
|||
Proceeds from stock option and warrant exercises
|
2,336
|
|
|
980
|
|
|
19,165
|
|
|||
Payment of stock issuance costs
|
—
|
|
|
(10
|
)
|
|
—
|
|
|||
Net cash provided by financing activities
|
309,795
|
|
|
4,284
|
|
|
12,065
|
|
|||
Effect of exchange rate changes on cash, cash equivalents, and restricted cash
|
295
|
|
|
1,055
|
|
|
(873
|
)
|
|||
Net increase (decrease) in cash, cash equivalents, and restricted cash
|
34,637
|
|
|
5,951
|
|
|
(66,188
|
)
|
|||
Cash, cash equivalents, and restricted cash
|
|
|
|
|
|
||||||
Beginning of period
|
75,545
|
|
|
69,594
|
|
|
135,782
|
|
|||
End of period
|
$
|
110,182
|
|
|
$
|
75,545
|
|
|
$
|
69,594
|
|
(Amounts in thousands)
|
2018
|
|
2017
|
|
2016
|
||||||
Supplemental disclosure of cash flow information
|
|
|
|
|
|
||||||
Cash paid during the period for interest
|
$
|
3,868
|
|
|
$
|
617
|
|
|
$
|
964
|
|
Cash paid during the period for income taxes
|
216
|
|
|
566
|
|
|
10
|
|
|||
Significant noncash financing and investing activities
|
|
|
|
|
|
||||||
Stock received as consideration for collaboration agreements
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
18,766
|
|
Preferred stock received as consideration for collaboration amendments
|
—
|
|
|
—
|
|
|
120,000
|
|
|||
Receivables converted to preferred stock
|
—
|
|
|
3,385
|
|
|
—
|
|
|||
Stock and warrants issued in business combinations
|
—
|
|
|
16,997
|
|
|
—
|
|
|||
Stock issued to acquire noncontrolling interests
|
—
|
|
|
5,082
|
|
|
—
|
|
|||
Stock issued for reacquired in-process research and development
|
159,323
|
|
|
—
|
|
|
—
|
|
|||
Stock issued in asset acquisition
|
—
|
|
|
—
|
|
|
4,401
|
|
|||
Long-term debt issued to a related party in an asset acquisition
|
30,000
|
|
|
—
|
|
|
—
|
|
|||
Contingent consideration assumed in asset acquisition
|
—
|
|
|
—
|
|
|
3,660
|
|
|||
Stock issued as payment for contingent consideration
|
—
|
|
|
—
|
|
|
1,583
|
|
|||
Noncash dividend to shareholders
|
—
|
|
|
22,385
|
|
|
—
|
|
|||
Purchases of property and equipment included in accounts payable and other accrued liabilities
|
2,267
|
|
|
2,257
|
|
|
652
|
|
|||
Purchases of equipment financed through debt
|
234
|
|
|
—
|
|
|
—
|
|
|||
Receivable recorded in anticipation of dissolution of affiliate
|
—
|
|
|
2,598
|
|
|
—
|
|
|||
Transfer of inventory to breeding stock
|
—
|
|
|
—
|
|
|
1,191
|
|
|
2018
|
|
2017
|
||||
Cash and cash equivalents
|
$
|
102,768
|
|
|
$
|
68,111
|
|
Restricted cash
|
6,987
|
|
|
6,987
|
|
||
Restricted cash included in other assets
|
427
|
|
|
447
|
|
||
Cash, cash equivalents, and restricted cash
|
$
|
110,182
|
|
|
$
|
75,545
|
|
(1)
|
The consideration is commensurate with either the entity's performance to achieve the milestone or the enhancement of the value of the delivered item or items as a result of a specific outcome resulting from the entity's performance to achieve the milestone;
|
(2)
|
The consideration relates solely to past performance; and
|
(3)
|
The consideration is reasonable relative to all of the deliverables and payment terms within the arrangement.
|
Level 1:
|
Quoted prices in active markets for identical assets and liabilities;
|
|
|
Level 2:
|
Other than quoted prices included in Level 1 inputs that are observable for the asset or liability, either directly or indirectly; and
|
|
|
Level 3:
|
Unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available.
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Revenues
|
$
|
557
|
|
|
$
|
254
|
|
|
$
|
417
|
|
Operating expenses
|
36,990
|
|
|
41,904
|
|
|
62,373
|
|
|||
Operating loss
|
(36,433
|
)
|
|
(41,650
|
)
|
|
(61,956
|
)
|
|||
Other, net
|
44
|
|
|
(8
|
)
|
|
1,535
|
|
|||
Net loss
|
$
|
(36,389
|
)
|
|
$
|
(41,658
|
)
|
|
$
|
(60,421
|
)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Beginning balance
|
$
|
4,631
|
|
|
$
|
3,703
|
|
|
$
|
2,081
|
|
Charged to operating expenses
|
1,779
|
|
|
1,217
|
|
|
1,963
|
|
|||
Write offs of accounts receivable, net of recoveries
|
(1,267
|
)
|
|
(289
|
)
|
|
(341
|
)
|
|||
Ending balance
|
$
|
5,143
|
|
|
$
|
4,631
|
|
|
$
|
3,703
|
|
•
|
As a period charge in the future period in which the tax arises; or
|
•
|
As part of deferred taxes related to the investment or subsidiary.
|
|
2018
|
|
2017
|
|
2016
|
Valuation assumptions
|
|
|
|
|
|
Expected dividend yield
|
0%
|
|
0%
|
|
0%
|
Expected volatility
|
55%—59%
|
|
57%—60%
|
|
59%—60%
|
Expected term (years)
|
6.25
|
|
6.25
|
|
6.25
|
Risk-free interest rate
|
2.33%—3.06%
|
|
1.89%—2.27%
|
|
1.23%—2.17%
|
|
Year Ended December 31, 2018
|
||||||||||
|
As Reported
|
|
Balances Without Adoption of ASC 606
|
|
Effect of Change
|
||||||
Consolidated Statement of Operations
|
|
|
|
|
|
||||||
Collaboration and licensing revenues
|
$
|
76,869
|
|
|
$
|
78,441
|
|
|
$
|
(1,572
|
)
|
Net loss
|
(514,706
|
)
|
|
(513,134
|
)
|
|
(1,572
|
)
|
|||
Net loss attributable to Intrexon
|
(509,336
|
)
|
|
(507,764
|
)
|
|
(1,572
|
)
|
|
December 31, 2018
|
||||||||||
|
As Reported
|
|
Balances Without Adoption of ASC 606
|
|
Effect of Change
|
||||||
Consolidated Balance Sheet
|
|
|
|
|
|
||||||
Liabilities
|
|
|
|
|
|
||||||
Deferred revenue, current
|
$
|
15,554
|
|
|
$
|
18,934
|
|
|
$
|
(3,380
|
)
|
Deferred revenue, net of current portion
|
54,210
|
|
|
48,082
|
|
|
6,128
|
|
|||
Total equity
|
|
|
|
|
|
||||||
Accumulated deficit
|
(1,330,545
|
)
|
|
(1,355,583
|
)
|
|
25,038
|
|
|||
Accumulated other comprehensive loss
|
(28,612
|
)
|
|
(28,598
|
)
|
|
(14
|
)
|
Common shares
|
$
|
15,616
|
|
Warrants
|
1,381
|
|
|
Contingent consideration
|
585
|
|
|
|
$
|
17,582
|
|
Cash and cash equivalents
|
$
|
2,054
|
|
Short-term investments
|
542
|
|
|
Trade receivables
|
75
|
|
|
Other receivables
|
97
|
|
|
Prepaid expenses and other
|
227
|
|
|
Property and equipment
|
250
|
|
|
Intangible assets
|
14,000
|
|
|
Other noncurrent assets
|
58
|
|
|
Total assets acquired
|
17,303
|
|
|
Accounts payable
|
2,158
|
|
|
Accrued compensation and benefits
|
1,226
|
|
|
Other accrued expenses
|
856
|
|
|
Other long-term liabilities
|
92
|
|
|
Deferred tax liabilities
|
239
|
|
|
Total liabilities assumed
|
4,571
|
|
|
Net assets acquired
|
12,732
|
|
|
Goodwill
|
4,850
|
|
|
Total consideration
|
$
|
17,582
|
|
|
Year Ended December 31,
|
||||||
|
2017
|
|
2016
|
||||
|
Pro Forma
|
||||||
Revenues
|
$
|
231,213
|
|
|
$
|
191,437
|
|
Loss before income taxes
|
(136,966
|
)
|
|
(201,210
|
)
|
||
Net loss
|
(134,275
|
)
|
|
(197,144
|
)
|
||
Net loss attributable to the noncontrolling interests
|
9,802
|
|
|
3,662
|
|
||
Net loss attributable to Intrexon
|
(124,473
|
)
|
|
(193,482
|
)
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
ZIOPHARM Oncology, Inc.
|
$
|
16,298
|
|
|
$
|
69,812
|
|
|
$
|
33,836
|
|
Ares Trading S.A.
|
11,175
|
|
|
10,738
|
|
|
10,192
|
|
|||
Oragenics, Inc.
|
1,353
|
|
|
2,020
|
|
|
2,752
|
|
|||
Intrexon T1D Partners, LLC
|
2,502
|
|
|
5,968
|
|
|
1,908
|
|
|||
Intrexon Energy Partners, LLC
|
6,929
|
|
|
10,665
|
|
|
17,552
|
|
|||
Intrexon Energy Partners II, LLC
|
2,998
|
|
|
3,672
|
|
|
3,169
|
|
|||
Genopaver, LLC
|
3,710
|
|
|
6,690
|
|
|
6,117
|
|
|||
Fibrocell Science, Inc.
|
1,394
|
|
|
7,344
|
|
|
5,942
|
|
|||
Persea Bio, LLC
|
955
|
|
|
946
|
|
|
1,278
|
|
|||
OvaXon, LLC
|
—
|
|
|
1,966
|
|
|
2,934
|
|
|||
S & I Ophthalmic, LLC
|
—
|
|
|
755
|
|
|
6,141
|
|
|||
Harvest start-up entities (1)
|
14,447
|
|
|
15,232
|
|
|
4,974
|
|
|||
Other
|
15,108
|
|
|
9,771
|
|
|
13,076
|
|
|||
Total
|
$
|
76,869
|
|
|
$
|
145,579
|
|
|
$
|
109,871
|
|
(1)
|
For the years ended
December 31, 2018
,
2017
, and
2016
, revenue recognized from collaborations with Harvest start-up entities include Genten Therapeutics, Inc.; CRS Bio, Inc.; Exotech Bio, Inc.; AD Skincare, Inc.; and Thrive Agrobiotics, Inc. For the years ended
December 31, 2017
and
2016
, revenue recognized from collaborations with Harvest start-up entities also include Relieve Genetics, Inc.
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
Collaboration and licensing agreements
|
$
|
63,284
|
|
|
$
|
231,583
|
|
Prepaid product and service revenues
|
2,933
|
|
|
4,681
|
|
||
Other
|
3,547
|
|
|
133
|
|
||
Total
|
$
|
69,764
|
|
|
$
|
236,397
|
|
Current portion of deferred revenue
|
$
|
15,554
|
|
|
$
|
42,870
|
|
Long-term portion of deferred revenue
|
54,210
|
|
|
193,527
|
|
||
Total
|
$
|
69,764
|
|
|
$
|
236,397
|
|
|
Average Remaining Performance Period (Years)
|
|
December 31,
|
||||||
|
|
2018
|
|
2017
|
|||||
ZIOPHARM Oncology, Inc.
|
0.8
|
|
$
|
1,214
|
|
|
$
|
90,496
|
|
Ares Trading S.A.
|
0.0
|
|
—
|
|
|
40,789
|
|
||
Oragenics, Inc.
|
5.4
|
|
5,810
|
|
|
6,719
|
|
||
Intrexon T1D Partners, LLC
|
0.0
|
|
—
|
|
|
8,435
|
|
||
Intrexon Energy Partners, LLC
|
5.3
|
|
10,267
|
|
|
15,625
|
|
||
Intrexon Energy Partners II, LLC
|
5.9
|
|
14,060
|
|
|
13,833
|
|
||
Genopaver, LLC
|
5.3
|
|
1,175
|
|
|
1,704
|
|
||
Fibrocell Science, Inc.
|
5.9
|
|
17,519
|
|
|
16,607
|
|
||
Persea Bio, LLC
|
6.0
|
|
2,697
|
|
|
3,500
|
|
||
Harvest start-up entities (1)
|
6.2
|
|
7,644
|
|
|
18,400
|
|
||
Other
|
2.3
|
|
2,898
|
|
|
14,423
|
|
||
Total
|
|
|
$
|
63,284
|
|
|
$
|
230,531
|
|
(1)
|
As of
December 31, 2018
and
December 31, 2017
, the balance of deferred revenue for collaborations with Harvest start-up entities includes Exotech Bio, Inc.; AD Skincare, Inc.; and Thrive Agrobiotics, Inc. As of
December 31, 2017
, the balance of deferred revenue for collaborations with Harvest start-up entities also includes: Genten Therapeutics, Inc.; CRS Bio, Inc.; and Relieve Genetics, Inc. See Note
3
for further discussion of the asset acquisition of certain Harvest entities.
|
|
Amortized
Cost
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
|
|
Aggregate
Fair Value
|
||||||||
United States government debt securities
|
$
|
119,401
|
|
|
$
|
—
|
|
|
$
|
(61
|
)
|
|
$
|
119,340
|
|
Certificates of deposit
|
348
|
|
|
—
|
|
|
—
|
|
|
348
|
|
||||
Total
|
$
|
119,749
|
|
|
$
|
—
|
|
|
$
|
(61
|
)
|
|
$
|
119,688
|
|
|
Amortized
Cost
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
|
|
Aggregate
Fair Value
|
||||||||
United States government debt securities
|
$
|
6,000
|
|
|
$
|
—
|
|
|
$
|
(2
|
)
|
|
$
|
5,998
|
|
Certificates of deposit
|
275
|
|
|
—
|
|
|
—
|
|
|
275
|
|
||||
Total
|
$
|
6,275
|
|
|
$
|
—
|
|
|
$
|
(2
|
)
|
|
$
|
6,273
|
|
|
2018
|
|
2017
|
||||
Beginning balance
|
$
|
161,225
|
|
|
$
|
129,545
|
|
Purchase of preferred stock
|
—
|
|
|
766
|
|
||
Conversion of receivables to preferred stock
|
—
|
|
|
3,385
|
|
||
Dividend income from investments in preferred stock
|
14,841
|
|
|
16,756
|
|
||
Net unrealized appreciation (depreciation) in the fair value of the investments in preferred stock
|
(17,499
|
)
|
|
10,773
|
|
||
Return of preferred stock
|
(158,376
|
)
|
|
—
|
|
||
Ending balance
|
$
|
191
|
|
|
$
|
161,225
|
|
|
Quoted Prices in Active Markets
(Level 1)
|
|
Significant Other Observable Inputs
(Level 2)
|
|
Significant Unobservable Inputs
(Level 3)
|
|
December 31,
2018 |
||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
United States government debt securities
|
$
|
—
|
|
|
$
|
119,340
|
|
|
$
|
—
|
|
|
$
|
119,340
|
|
Equity securities
|
1,626
|
|
|
556
|
|
|
—
|
|
|
2,182
|
|
||||
Preferred stock
|
—
|
|
|
—
|
|
|
191
|
|
|
191
|
|
||||
Other
|
—
|
|
|
468
|
|
|
—
|
|
|
468
|
|
||||
Total
|
$
|
1,626
|
|
|
$
|
120,364
|
|
|
$
|
191
|
|
|
$
|
122,181
|
|
|
Quoted Prices in Active Markets
(Level 1)
|
|
Significant Other Observable Inputs
(Level 2)
|
|
Significant Unobservable Inputs
(Level 3)
|
|
December 31,
2017 |
||||||||
Assets
|
|
|
|
|
|
|
|
||||||||
United States government debt securities
|
$
|
—
|
|
|
$
|
5,998
|
|
|
$
|
—
|
|
|
$
|
5,998
|
|
Equity securities
|
10,537
|
|
|
4,563
|
|
|
—
|
|
|
15,100
|
|
||||
Preferred stock
|
—
|
|
|
—
|
|
|
161,225
|
|
|
161,225
|
|
||||
Other
|
—
|
|
|
850
|
|
|
—
|
|
|
850
|
|
||||
Total
|
$
|
10,537
|
|
|
$
|
11,411
|
|
|
$
|
161,225
|
|
|
$
|
183,173
|
|
|
2018
|
|
2017
|
||||
Beginning balance
|
$
|
585
|
|
|
$
|
2,081
|
|
Acquisition date fair value of contingent consideration liability
|
—
|
|
|
585
|
|
||
Change in fair value of contingent consideration recognized in selling, general and administrative expenses
|
—
|
|
|
(2,081
|
)
|
||
Ending balance
|
$
|
585
|
|
|
$
|
585
|
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
Supplies, embryos and other production materials
|
$
|
4,729
|
|
|
$
|
2,673
|
|
Work in process
|
4,391
|
|
|
4,767
|
|
||
Livestock
|
10,167
|
|
|
11,040
|
|
||
Feed
|
2,160
|
|
|
2,013
|
|
||
Total inventory
|
$
|
21,447
|
|
|
$
|
20,493
|
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
Land and land improvements
|
$
|
12,490
|
|
|
$
|
11,767
|
|
Buildings and building improvements
|
20,371
|
|
|
18,183
|
|
||
Furniture and fixtures
|
1,891
|
|
|
2,515
|
|
||
Equipment
|
74,555
|
|
|
65,863
|
|
||
Leasehold improvements
|
28,289
|
|
|
25,277
|
|
||
Breeding stock
|
4,582
|
|
|
3,832
|
|
||
Computer hardware and software
|
11,697
|
|
|
10,128
|
|
||
Trees
|
11,910
|
|
|
6,642
|
|
||
Construction and other assets in progress
|
18,880
|
|
|
14,113
|
|
||
|
184,665
|
|
|
158,320
|
|
||
Less: Accumulated depreciation and amortization
|
(55,791
|
)
|
|
(45,646
|
)
|
||
Property, plant and equipment, net
|
$
|
128,874
|
|
|
$
|
112,674
|
|
|
2018
|
|
2017
|
||||
Beginning balance
|
$
|
153,289
|
|
|
$
|
157,175
|
|
Acquisitions
|
—
|
|
|
4,850
|
|
||
Impairment
|
—
|
|
|
(13,823
|
)
|
||
Foreign currency translation adjustments
|
(3,704
|
)
|
|
5,087
|
|
||
Ending balance
|
$
|
149,585
|
|
|
$
|
153,289
|
|
|
Weighted Average Useful Life (Years)
|
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net
|
||||||
Patents, developed technologies and know-how
|
15.5
|
|
$
|
152,482
|
|
|
$
|
(35,133
|
)
|
|
$
|
117,349
|
|
Customer relationships
|
6.5
|
|
10,700
|
|
|
(7,565
|
)
|
|
3,135
|
|
|||
Trademarks
|
9.3
|
|
6,800
|
|
|
(3,341
|
)
|
|
3,459
|
|
|||
In-process research and development
|
|
|
5,348
|
|
|
—
|
|
|
5,348
|
|
|||
Total
|
|
|
$
|
175,330
|
|
|
$
|
(46,039
|
)
|
|
$
|
129,291
|
|
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net
|
||||||
Patents, developed technologies and know-how
|
$
|
263,615
|
|
|
$
|
(44,954
|
)
|
|
$
|
218,661
|
|
Customer relationships
|
10,700
|
|
|
(6,383
|
)
|
|
4,317
|
|
|||
Trademarks
|
6,800
|
|
|
(2,567
|
)
|
|
4,233
|
|
|||
In-process research and development
|
5,666
|
|
|
—
|
|
|
5,666
|
|
|||
Total
|
$
|
286,781
|
|
|
$
|
(53,904
|
)
|
|
$
|
232,877
|
|
2019
|
$
|
11,966
|
|
2020
|
11,863
|
|
|
2021
|
11,675
|
|
|
2022
|
10,676
|
|
|
2023
|
9,798
|
|
|
Thereafter
|
67,965
|
|
|
Total
|
$
|
123,943
|
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
Convertible debt
|
$
|
203,391
|
|
|
$
|
—
|
|
Notes payable
|
4,551
|
|
|
5,010
|
|
||
Royalty-based financing
|
2,085
|
|
|
2,132
|
|
||
Other
|
1,767
|
|
|
895
|
|
||
Long-term debt
|
211,794
|
|
|
8,037
|
|
||
Less current portion
|
559
|
|
|
502
|
|
||
Long-term debt, less current portion
|
$
|
211,235
|
|
|
$
|
7,535
|
|
•
|
During any calendar quarter commencing after the calendar quarter ending on September 30, 2018, if the last reported sales price of Intrexon's common stock for at least
20
trading days (whether or not consecutive) during the last
30
consecutive trading days of the immediately preceding calendar quarter is greater than or equal to
130%
of the conversion price on each applicable trading day;
|
•
|
During the
five
business day period after any
five
consecutive trading day period in which the trading price, as defined in the Indenture, for the Convertible Notes is less than
98%
of the product of the last reported sales price of Intrexon's common stock and the conversion rate for the Convertible Notes on each such trading day; or
|
•
|
Upon the occurrence of specified corporate events as defined in the Indenture.
|
2019
|
$
|
559
|
|
2020
|
30,843
|
|
|
2021
|
25,405
|
|
|
2022
|
420
|
|
|
2023
|
201,442
|
|
|
Thereafter
|
2,939
|
|
|
Total
|
$
|
261,608
|
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Domestic
|
$
|
(443,337
|
)
|
|
$
|
(71,343
|
)
|
|
$
|
(157,067
|
)
|
Foreign
|
(92,897
|
)
|
|
(58,357
|
)
|
|
(37,084
|
)
|
|||
Loss before income taxes
|
$
|
(536,234
|
)
|
|
$
|
(129,700
|
)
|
|
$
|
(194,151
|
)
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
United States federal income taxes:
|
|
|
|
|
|
||||||
Current
|
$
|
(31
|
)
|
|
$
|
27
|
|
|
$
|
(17
|
)
|
Deferred
|
(11,855
|
)
|
|
(523
|
)
|
|
1,396
|
|
|||
Foreign income taxes:
|
|
|
|
|
|
||||||
Current
|
(332
|
)
|
|
(379
|
)
|
|
(393
|
)
|
|||
Deferred
|
(5,068
|
)
|
|
(2,269
|
)
|
|
(5,177
|
)
|
|||
State income taxes:
|
|
|
|
|
|
||||||
Current
|
113
|
|
|
—
|
|
|
—
|
|
|||
Deferred
|
(4,355
|
)
|
|
264
|
|
|
314
|
|
|||
Income tax benefit
|
$
|
(21,528
|
)
|
|
$
|
(2,880
|
)
|
|
$
|
(3,877
|
)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Computed statutory income tax benefit
|
$
|
(112,609
|
)
|
|
$
|
(44,098
|
)
|
|
$
|
(66,011
|
)
|
State and provincial income tax benefit, net of federal income taxes
|
(24,724
|
)
|
|
(3,294
|
)
|
|
(7,905
|
)
|
|||
Nondeductible stock based compensation
|
1,834
|
|
|
4,147
|
|
|
3,321
|
|
|||
Nondeductible officer compensation
|
294
|
|
|
476
|
|
|
—
|
|
|||
Gain on dividend distribution of AquaBounty common stock
|
—
|
|
|
3,965
|
|
|
—
|
|
|||
Impairment of goodwill
|
—
|
|
|
4,700
|
|
|
—
|
|
|||
Research and development tax incentives
|
(1,088
|
)
|
|
(1,166
|
)
|
|
(6,350
|
)
|
|||
Acquisition and internal restructuring transaction costs
|
52
|
|
|
354
|
|
|
571
|
|
|||
Provisional impact of the Tax Act
|
—
|
|
|
85,288
|
|
|
—
|
|
|||
Enacted changes in foreign tax rates and foreign tax reforms
|
—
|
|
|
2,138
|
|
|
—
|
|
|||
Reacquired in-process research and development
|
2,696
|
|
|
—
|
|
|
—
|
|
|||
Change in deferred state tax rate
|
8,666
|
|
|
—
|
|
|
—
|
|
|||
United States-foreign rate differential
|
3,017
|
|
|
5,410
|
|
|
3,463
|
|
|||
Other, net
|
(486
|
)
|
|
(64
|
)
|
|
1,485
|
|
|||
|
(122,348
|
)
|
|
57,856
|
|
|
(71,426
|
)
|
|||
Change in valuation allowance for deferred tax assets
|
100,820
|
|
|
(60,736
|
)
|
|
67,549
|
|
|||
Total income tax benefit
|
$
|
(21,528
|
)
|
|
$
|
(2,880
|
)
|
|
$
|
(3,877
|
)
|
|
2018
|
|
2017
|
||||
Deferred tax assets
|
|
|
|
||||
Allowance for doubtful accounts
|
$
|
1,490
|
|
|
$
|
1,300
|
|
Inventory
|
614
|
|
|
489
|
|
||
Equity securities and investments in affiliates
|
30,241
|
|
|
17,510
|
|
||
Intangible assets
|
71,205
|
|
|
—
|
|
||
Accrued liabilities
|
4,412
|
|
|
3,131
|
|
||
Stock-based compensation
|
29,297
|
|
|
26,936
|
|
||
Deferred revenue
|
16,297
|
|
|
61,785
|
|
||
Research and development tax credits
|
11,597
|
|
|
11,385
|
|
||
Net operating and capital loss carryforwards
|
148,411
|
|
|
111,453
|
|
||
Total deferred tax assets
|
313,564
|
|
|
233,989
|
|
||
Less: Valuation allowance
|
308,113
|
|
|
215,582
|
|
||
Net deferred tax assets
|
5,451
|
|
|
18,407
|
|
||
Deferred tax liabilities
|
|
|
|
||||
Property, plant and equipment
|
528
|
|
|
237
|
|
||
Intangible assets
|
—
|
|
|
33,790
|
|
||
Long-term debt
|
12,136
|
|
|
—
|
|
||
Total deferred tax liabilities
|
12,664
|
|
|
34,027
|
|
||
Net deferred tax liabilities
|
$
|
(7,213
|
)
|
|
$
|
(15,620
|
)
|
|
2018
|
|
2017
|
|
2016
|
||||||
Valuation allowance at beginning of year
|
$
|
215,582
|
|
|
$
|
256,165
|
|
|
$
|
190,174
|
|
Increase (decrease) in valuation allowance as a result of
|
|
|
|
|
|
||||||
Mergers and acquisitions, net
|
418
|
|
|
—
|
|
|
(1,416
|
)
|
|||
Current year operations
|
122,853
|
|
|
26,619
|
|
|
67,549
|
|
|||
Adoption of ASC 606
|
(7,477
|
)
|
|
—
|
|
|
—
|
|
|||
Adoption of ASU 2016-09
|
—
|
|
|
17,843
|
|
|
—
|
|
|||
Provisional impact of the Tax Act
|
—
|
|
|
(87,473
|
)
|
|
—
|
|
|||
Equity component of long-term debt
|
(13,367
|
)
|
|
—
|
|
|
—
|
|
|||
Change in deferred state tax rate
|
(8,666
|
)
|
|
—
|
|
|
—
|
|
|||
Changes in foreign tax rates and foreign tax reforms
|
—
|
|
|
1,327
|
|
|
—
|
|
|||
Foreign currency translation adjustment
|
(1,230
|
)
|
|
1,101
|
|
|
(142
|
)
|
|||
Valuation allowance at end of year
|
$
|
308,113
|
|
|
$
|
215,582
|
|
|
$
|
256,165
|
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
Unrealized loss on investments
|
$
|
(61
|
)
|
|
$
|
(2
|
)
|
Loss on foreign currency translation adjustments
|
(28,551
|
)
|
|
(15,552
|
)
|
||
Total accumulated other comprehensive loss
|
$
|
(28,612
|
)
|
|
$
|
(15,554
|
)
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Cost of products
|
$
|
78
|
|
|
$
|
116
|
|
|
$
|
81
|
|
Cost of services
|
237
|
|
|
322
|
|
|
274
|
|
|||
Research and development
|
9,676
|
|
|
9,336
|
|
|
9,251
|
|
|||
Selling, general and administrative
|
26,305
|
|
|
31,802
|
|
|
32,596
|
|
|||
Total
|
$
|
36,296
|
|
|
$
|
41,576
|
|
|
$
|
42,202
|
|
|
Number of Shares
|
|
Weighted Average Exercise Price
|
|
Weighted Average Remaining Contractual Term (Years)
|
|||
Balances at December 31, 2015
|
11,043,528
|
|
|
$
|
32.66
|
|
|
8.49
|
Granted
|
4,644,860
|
|
|
29.39
|
|
|
|
|
Exercised
|
(1,210,840
|
)
|
|
(15.83
|
)
|
|
|
|
Forfeited
|
(2,760,809
|
)
|
|
(40.34
|
)
|
|
|
|
Expired
|
(76,356
|
)
|
|
(37.81
|
)
|
|
|
|
Balances at December 31, 2016
|
11,640,383
|
|
|
31.25
|
|
|
8.21
|
|
Granted
|
3,920,950
|
|
|
21.47
|
|
|
|
|
Adjustment due to dividend (Note 14)
|
46,766
|
|
|
31.11
|
|
|
|
|
Exercised
|
(149,429
|
)
|
|
(6.37
|
)
|
|
|
|
Forfeited
|
(3,797,105
|
)
|
|
(28.37
|
)
|
|
|
|
Expired
|
(278,818
|
)
|
|
(33.18
|
)
|
|
|
|
Balances at December 31, 2017
|
11,382,747
|
|
|
28.99
|
|
|
7.32
|
|
Granted
|
1,470,339
|
|
|
14.26
|
|
|
|
|
Exercised
|
(45,159
|
)
|
|
(6.59
|
)
|
|
|
|
Forfeited
|
(929,596
|
)
|
|
(21.48
|
)
|
|
|
|
Expired
|
(785,268
|
)
|
|
(26.25
|
)
|
|
|
|
Balances at December 31, 2018
|
11,093,063
|
|
|
27.95
|
|
|
6.81
|
|
Exercisable at December 31, 2018
|
7,002,519
|
|
|
30.37
|
|
|
5.97
|
|
|
|
|
Options Outstanding
|
|
Options Exercisable
|
||||||||||||||||||||||||||
Range of Exercise Prices
|
|
Number of Options
|
|
Weighted Average Exercise Price
|
|
Weighted Average Remaining Life (Years)
|
|
Aggregate Intrinsic Value
|
|
Number of Options
|
|
Weighted Average Exercise Price
|
|
Weighted Average Remaining Life (Years)
|
|
Aggregate Intrinsic Value
|
||||||||||||||||
$
|
3.17
|
|
—
|
$
|
19.52
|
|
|
1,973,818
|
|
|
$
|
13.70
|
|
|
7.54
|
|
$
|
169
|
|
|
833,007
|
|
|
$
|
12.80
|
|
|
4.85
|
|
$
|
169
|
|
$
|
19.85
|
|
—
|
$
|
20.94
|
|
|
1,914,763
|
|
|
20.93
|
|
|
7.99
|
|
—
|
|
|
500,263
|
|
|
20.92
|
|
|
7.67
|
|
—
|
|
||||
$
|
21.00
|
|
—
|
$
|
27.08
|
|
|
2,057,126
|
|
|
23.29
|
|
|
7.26
|
|
—
|
|
|
1,248,370
|
|
|
23.01
|
|
|
6.69
|
|
—
|
|
||||
$
|
27.10
|
|
—
|
$
|
29.56
|
|
|
2,666,109
|
|
|
29.19
|
|
|
5.28
|
|
—
|
|
|
2,593,151
|
|
|
29.20
|
|
|
5.23
|
|
—
|
|
||||
$
|
29.58
|
|
—
|
$
|
65.08
|
|
|
2,481,247
|
|
|
47.24
|
|
|
6.59
|
|
—
|
|
|
1,827,728
|
|
|
47.65
|
|
|
6.54
|
|
—
|
|
||||
|
|
|
|
11,093,063
|
|
|
$
|
27.95
|
|
|
6.81
|
|
$
|
169
|
|
|
7,002,519
|
|
|
$
|
30.37
|
|
|
5.97
|
|
$
|
169
|
|
|
|
|
|
Options Outstanding
|
|
Options Exercisable
|
||||||||||||||||||||||||||
Range of Exercise Prices
|
|
Number of Options
|
|
Weighted Average Exercise Price
|
|
Weighted Average Remaining Life (Years)
|
|
Aggregate Intrinsic Value
|
|
Number of Options
|
|
Weighted Average Exercise Price
|
|
Weighted Average Remaining Life (Years)
|
|
Aggregate Intrinsic Value
|
||||||||||||||||
$
|
2.64
|
|
—
|
$
|
9.30
|
|
|
453,371
|
|
|
$
|
7.06
|
|
|
3.94
|
|
$
|
2,020
|
|
|
453,371
|
|
|
$
|
7.06
|
|
|
3.94
|
|
$
|
2,020
|
|
$
|
12.50
|
|
—
|
$
|
21.38
|
|
|
3,158,121
|
|
|
20.58
|
|
|
8.74
|
|
—
|
|
|
456,942
|
|
|
19.52
|
|
|
7.13
|
|
—
|
|
||||
$
|
21.43
|
|
—
|
$
|
28.81
|
|
|
3,399,721
|
|
|
25.55
|
|
|
6.91
|
|
—
|
|
|
1,804,401
|
|
|
25.86
|
|
|
5.69
|
|
—
|
|
||||
$
|
28.88
|
|
—
|
$
|
40.99
|
|
|
2,751,716
|
|
|
32.07
|
|
|
6.70
|
|
—
|
|
|
1,732,250
|
|
|
31.51
|
|
|
6.32
|
|
—
|
|
||||
$
|
41.41
|
|
—
|
$
|
65.08
|
|
|
1,619,818
|
|
|
53.52
|
|
|
7.42
|
|
—
|
|
|
859,733
|
|
|
53.07
|
|
|
7.38
|
|
—
|
|
||||
|
|
|
|
11,382,747
|
|
|
$
|
28.99
|
|
|
7.32
|
|
$
|
2,020
|
|
|
5,306,697
|
|
|
$
|
29.96
|
|
|
6.14
|
|
$
|
2,020
|
|
|
Number of Restricted Stock Units
|
|
Weighted Average Grant Date Fair Value
|
|
Weighted Average Remaining Contractual Term (Years)
|
|||
Balances at December 31, 2017
|
—
|
|
|
$
|
—
|
|
|
0.00
|
Granted
|
1,069,126
|
|
|
13.84
|
|
|
|
|
Vested
|
(25,000
|
)
|
|
(15.82
|
)
|
|
|
|
Forfeited
|
(73,785
|
)
|
|
(13.47
|
)
|
|
|
|
Balances at December 31, 2018
|
970,341
|
|
|
13.82
|
|
|
1.43
|
2019
|
$
|
9,182
|
|
2020
|
9,910
|
|
|
2021
|
9,127
|
|
|
2022
|
8,305
|
|
|
2023
|
7,229
|
|
|
Thereafter
|
34,157
|
|
|
Total
|
$
|
77,910
|
|
|
2018
|
|
2017
|
|
2016
|
||||||
Historical net loss per share:
|
|
|
|
|
|
||||||
Numerator:
|
|
|
|
|
|
||||||
Net loss attributable to Intrexon
|
$
|
(509,336
|
)
|
|
$
|
(117,018
|
)
|
|
$
|
(186,612
|
)
|
Denominator:
|
|
|
|
|
|
||||||
Weighted average shares outstanding, basic and diluted
|
129,521,731
|
|
|
119,998,826
|
|
|
117,983,836
|
|
|||
Net loss attributable to Intrexon per share, basic and diluted
|
$
|
(3.93
|
)
|
|
$
|
(0.98
|
)
|
|
$
|
(1.58
|
)
|
|
December 31,
|
|||||||
|
2018
|
|
2017
|
|
2016
|
|||
Convertible debt
|
18,955,668
|
|
|
—
|
|
|
—
|
|
Options
|
11,093,063
|
|
|
11,382,747
|
|
|
11,640,383
|
|
Restricted stock units
|
970,341
|
|
|
—
|
|
|
—
|
|
Warrants
|
133,264
|
|
|
133,264
|
|
|
—
|
|
Total
|
31,152,336
|
|
|
11,516,011
|
|
|
11,640,383
|
|
|
Three Months Ended
|
||||||||||||||
|
March 31,
2018 |
|
June 30,
2018 |
|
September 30,
2018 |
|
December 31, 2018 (1)
|
||||||||
Total revenues
|
$
|
39,666
|
|
|
$
|
45,275
|
|
|
$
|
32,448
|
|
|
$
|
43,185
|
|
Operating loss
|
(52,522
|
)
|
|
(49,735
|
)
|
|
(66,471
|
)
|
|
(336,882
|
)
|
||||
Net loss
|
(47,409
|
)
|
|
(66,829
|
)
|
|
(58,746
|
)
|
|
(341,722
|
)
|
||||
Net loss attributable to Intrexon
|
(46,165
|
)
|
|
(65,382
|
)
|
|
(57,324
|
)
|
|
(340,465
|
)
|
||||
Net loss attributable to Intrexon per share, basic and diluted
|
$
|
(0.36
|
)
|
|
$
|
(0.51
|
)
|
|
$
|
(0.44
|
)
|
|
$
|
(2.59
|
)
|
(1)
|
During the fourth quarter of 2018, the Company reacquired certain in-process research and development from ZIOPHARM, Ares Trading, and Intrexon T1D Partners, all of which were immediately expensed (Notes
4
and
5
). The Company also recorded an intangible asset impairment charge and a loss on abandonment of certain of its intangible assets (Note
11
). The Company also recognized the remaining balance of deferred revenue associated with Histogenics and Synthetic Biologics upon the mutual termination of the ECCs with these entities (Note
17
).
|
|
Three Months Ended
|
||||||||||||||
|
March 31,
2017 |
|
June 30,
2017 |
|
September 30,
2017 |
|
December 31, 2017 (1)
|
||||||||
Total revenues
|
$
|
53,504
|
|
|
$
|
54,433
|
|
|
$
|
46,016
|
|
|
$
|
77,028
|
|
Operating loss
|
(31,381
|
)
|
|
(35,270
|
)
|
|
(44,747
|
)
|
|
(26,492
|
)
|
||||
Net loss
|
(32,377
|
)
|
|
(19,662
|
)
|
|
(40,836
|
)
|
|
(33,945
|
)
|
||||
Net loss attributable to Intrexon
|
(31,399
|
)
|
|
(18,664
|
)
|
|
(39,689
|
)
|
|
(27,266
|
)
|
||||
Net loss attributable to Intrexon per share, basic and diluted
|
$
|
(0.26
|
)
|
|
$
|
(0.16
|
)
|
|
$
|
(0.33
|
)
|
|
$
|
(0.23
|
)
|
(1)
|
During the fourth quarter of 2017, the Company recognized the remaining balance of deferred revenue associated with ZIOPHARM ECC2 upon the parties' mutual agreement to terminate (Note
5
). The Company also recorded goodwill impairment charges primarily related to the AquaBounty reporting unit and an impairment charge related to certain of its in-process research and development assets (Note
11
).
|
|
|
Page
|
Article 1
|
DEFINITIONS
|
|
Article 2
|
ASSIGNMENT AND ASSUMPTION
|
|
2.1
|
Assignment and Assumption of Collaboration Agreement
|
|
2.2
|
Closing
|
|
Article 3
|
FINANCIAL PROVISIONS
|
|
3.1
|
Sale and Issuance of Intrexon Shares
|
|
3.2
|
Purchase and Sale of Note
|
|
3.3
|
Specified CAR-T Products Royalties
|
|
Article 4
|
OTHER AGREEMENTS of THE PARTIES
|
|
4.1
|
Use of Note Proceeds
|
|
4.2
|
Development and Commercialization of Specified CAR-T Products
|
|
4.3
|
Shares to Be Issued
|
|
4.4
|
Registration Rights
|
|
4.4.1
|
Registration of Intrexon Shares
|
|
4.4.2
|
Registration of Intrexon Common Stock
|
|
4.4.3
|
Registration of Precigen Shares
|
|
4.4.4
|
Registration in a Precigen Financing
|
|
4.4.5
|
Other Provisions Applicable to Registration
|
|
(vi)
|
of such issuer's determination that a post-effective amendment to the Registration
|
|
4.4.6
|
Indemnification and Contribution
|
|
4.5
|
Shareholder Rights Plans; Anti-Takeover Measures
|
|
4.6
|
Precigen Board Designation Right
|
|
4.7
|
Lock-Up
|
|
4.8
|
Limitations on Intrexon Shares
|
|
4.9
|
Commercially Reasonable Efforts to Amend Collaboration Agreement
|
|
Article 5
|
LEGENDS; PUBLIC ANNOUNCEMENTS
|
|
5.1
|
Legends
|
|
5.2
|
Legend Removal
|
|
5.3
|
Public Announcements
|
|
Article 6
|
REPRESENTATIONS, WARRANTIES AND COVENANTS
|
|
6.1
|
Mutual Representations and Warranties
|
|
6.2
|
Representation and Warranties of Intrexon Parties
|
|
6.3
|
Representation and Warranties of ARES TRADING
|
|
6.4
|
Disclaimer of Representations and Warranties
|
|
6.5
|
Compliance with Collaboration Agreement
|
|
6.6
|
Mutual Release and Covenant Not to Sue
|
|
6.7
|
Reasonable Efforts; HSR
|
|
|
Page
|
6.8
|
Access
|
|
6.9
|
Regulatory Matters
|
|
6.10
|
Post-Closing Covenants
|
|
Article 7
|
CONDITIONS TO CLOSING
|
|
7.1
|
Conditions to Obligations of ARES TRADING
|
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7.2
|
Conditions of Obligations of the Intrexon Parties
|
|
Article 8
|
INDEMNIFICATION AND LIMITATION OF LIABILITY
|
|
8.1
|
Indemnification by Intrexon and Precigen
|
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8.2
|
Indemnification by ARES TRADING
|
|
8.3
|
Indemnification Procedure
|
|
8.4
|
Mitigation of Loss
|
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8.5
|
LIMITATION OF LIABILITY
|
|
Article 9
|
TERMINATION
|
|
9.1
|
Termination Rights
|
|
9.2
|
Effects of Termination
|
|
Article 10
|
CONFIDENTIALITY
|
|
10.1
|
Confidentiality
|
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10.2
|
Exceptions
|
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10.3
|
Authorized Disclosures
|
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Article 11
|
ADDITIONAL PROVISIONS
|
|
11.1
|
Successors and Assigns
|
|
11.2
|
Further Actions
|
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11.3
|
Entire Agreement of the Parties; Amendments
|
|
11.4
|
Governing Law
|
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11.5
|
Dispute Resolution
|
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11.6
|
Notices and Deliveries
|
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11.7
|
Intrexon Guarantee
|
|
11.8
|
Severability
|
|
11.9
|
No Strict Construction; Headings
|
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11.10
|
No Waiver
|
|
11.11
|
Specific Performance
|
|
11.12
|
Cumulative Remedies
|
|
11.13
|
Trading Day Requirements
|
|
Exhibit A
|
Collaboration Agreement
|
|
Exhibit B
|
Deed of Assignment
|
|
Exhibit C
|
[RESERVED]
|
|
Exhibit D
|
Form of Note
|
|
Annex 1
|
Royalty Terms
|
|
INTREXON CORPORATION
|
|
|
|
By:
|
|
|
Name:
|
|
Title:
|
ARES TRADING S.A.
|
|
|
|
By:
|
|
|
Name:
|
|
Title:
|
PRECIGEN, INC.
|
|
|
|
By:
|
|
|
Name:
|
|
Title:
|
DATED
|
||
|
||
|
Intrexon Corporation (1)
|
|
|
- and -
|
|
|
Precigen, Inc. (2)
|
|
|
- and -
|
|
|
ARES Trading S.A. (3)
|
|
Deed of Assignment
|
|
(1)
|
ARES TRADING S.A.
, a corporation organized and existing under the laws of Switzerland, having offices at Zone Industrielle de L’Ouriettaz, 117 Aubonne, Switzerland (the "
Ares Trading
");
|
(2)
|
Intrexon Corporation
, a corporation organized and existing under the laws of Virginia, USA, having its principal place of business at 20374 Seneca Meadows Parkway, Germantown, MD 20876, USA ("
Intrexon
"); and
|
(3)
|
Precigen, Inc.
, a Delaware corporation, having its principal place of business at, 20358 Seneca Meadows Parkway, Germantown, MD 20876, USA ("
Precigen
").
|
(A)
|
Ares Trading, Intrexon and Ziopharm entered into the Agreement (as defined in clause 1 of this Deed). Intrexon has assigned and transferred its rights and obligations under the Agreement to Precigen.
|
(B)
|
Pursuant to a Securities Purchase, Assignment and Assumption Agreement entered into between Ares Trading and the Intrexon Parties on [INSERT DATE] (the "
Assignment and Assumption Agreement
"), Ares Trading agreed to assign and transfer all of its rights and obligations under the Agreement to Intrexon with effect from the Closing Date (as defined in the Assignment and Assumption Agreement), and the parties wish to give effect to that assignment by Ares Trading and assumption of obligations by Intrexon in accordance with the terms of this Deed (and without prejudice to the provisions of the Assignment and Assumption Agreement).
|
1.
|
DEFINITIONS AND INTERPRETATION
|
2.
|
ASSIGNMENT, TRANSFER AND RELEASE
|
2.1
|
Subject to clause 2.2, all of Ares Trading's Rights and Obligations under the Agreement are assigned and transferred from Ares Trading to Intrexon such that with effect from the Effective Date:
|
(a)
|
all of Ares Trading's Rights (whether past, present or future) are hereby assigned to Intrexon, and Intrexon accepts this assignment subject to the remainder of this clause 2.1;
|
(b)
|
all of the Intrexon Parties' Rights (whether past, present or future, and whether known or unknown) enforceable as against Ares Trading are fully and irrevocably released and discharged forever by the Intrexon Parties;
|
(c)
|
all of Ares Trading's (on the one hand) and the Intrexon Parties' (on the other hand) respective Obligations to each other are fully and irrevocably released and discharged forever by each of Ares Trading and the Intrexon Parties respectively;
|
(d)
|
Intrexon covenants, represents and undertakes to Ares Trading that it will duly and promptly perform on time and in accordance with the provisions of the Agreement all of Ares Trading's Obligations to Ziopharm arising with effect from the Effective Date as if they were Obligations originally accepted and contracted to be performed directly by Intrexon to Ziopharm;
|
(e)
|
all Liabilities arising prior to the Effective Date will be retained by the party that owes such Liabilities to the extent set forth in the Assignment and Assumption Agreement; and
|
(f)
|
all Liabilities of Ares Trading arising on or after the Effective Date shall be met, satisfied and discharged in full by Intrexon and in respect of which Intrexon shall on demand fully indemnify and hold harmless Ares Trading, provided that, except in accordance with the Agreement or the Assignment and Assumption Agreement, Ares Trading shall not take any actions to perform or purport to perform the Agreement without the consent of Intrexon or to wilfully frustrate Intrexon's
|
2.2
|
Nothing in this Deed will extinguish or vary any Rights, Obligations or Liabilities owed by or to Ziopharm, save that as between the parties Ares Trading's responsibility for its Obligations and Liabilities shall be assumed by Intrexon and/or Precigen in accordance with clause 2.1.
|
3.
|
FURTHER ASSURANCE
|
4.
|
MISCELLANEOUS
|
4.1
|
This Agreement shall be read in conjunction with and operate alongside the provisions of the Assignment and Assumption Agreement but shall not vary, amend or limit in any way the provisions of the Assignment and Assumption Agreement. If there is any conflict between this Agreement and the Assignment and Assumption Agreement, the Assignment and Assumption Agreement will prevail.
|
4.2
|
A variation of this Deed is valid only if it is in writing and signed by all of the parties or their respective duly authorised representatives.
|
4.3
|
Failure to exercise, or a delay in exercising, a right or remedy provided by this Deed or by law does not constitute a waiver of the right or remedy or a waiver of other rights or remedies. No single or partial exercise of a right or remedy provided by this Deed or by law prevents the further exercise of the right or remedy or the exercise of another right or remedy. A waiver of a breach of this Deed does not constitute a waiver of a subsequent or prior breach of this Deed.
|
4.4
|
If a provision of this Deed is found to be illegal, invalid or unenforceable, then to the extent it is illegal, invalid or unenforceable, that provision will be given no effect and will be treated as though it were not included in this Deed, but the validity or enforceability of the remaining provisions of this Deed will not be affected.
|
4.5
|
This Deed may be entered into in any number of counterparts and any party to this Deed may enter into this Deed by executing any counterpart. A counterpart constitutes an original of this Deed and all executed counterparts together have the same effect as if each to this Deed had executed the same document.
|
4.6
|
A person who is not a party to this Deed has no right under the Contracts (Rights of Third Parties) Act 1999 to enforce this Deed.
|
5.
|
GOVERNING LAW AND JURISDICTION
|
5.1
|
This Deed, the jurisdiction clause contained in it and all non-contractual obligations arising in any way whatsoever out of this Deed are governed by, construed and take effect in accordance with English law excluding application of any conflict of laws principles that would require application of the law of a different jurisdiction.
|
5.2
|
The courts of England have exclusive jurisdiction to settle any claim, dispute or matter of difference which may arise in any way whatsoever out of this Deed or the legal relationships established by this Deed, provided that the courts of England will not have jurisdiction in respect of, or any jurisdiction to prevent, a claim made under the Assignment and Assumption Agreement.
|
Executed and delivered as a deed by
ARES TRADING S.A.
, a company incorporated in Switzerland, acting by the authorised signatory named below who is permitted to execute for
ARES TRADING S.A.
under the laws of Switzerland
|
|
|
Name of authorised signatory:
|
|
|
|
|
Authorised signature
|
Witness name:
|
|
|
|
|
Witness signature
|
Witness address:
|
|
|
|
|
|
Name of authorised signatory:
|
|
|
|
|
Authorised signature
|
Witness name:
|
|
|
|
|
Witness signature
|
Witness address:
|
|
|
|
|
|
Executed and delivered as a deed by
Precigen, Inc.
, a corporation incorporated in the State of Delaware, USA, acting by the authorised signatory named below who is permitted to execute for
Precigen Inc.
under the laws of Delaware, USA.
|
|
|
Name of authorised signatory:
|
|
|
|
|
Authorised signature
|
Witness name:
|
|
|
|
|
Witness signature
|
Witness address:
|
|
|
|
|
|
Executed and delivered as a deed by
Intrexon Corporation
, a corporation incorporated in the State of Virginia, USA, acting by the authorised signatory named below who is permitted to execute for
Intrexon Corporation
under the laws of Virginia, USA
|
|
|
Name of authorised signatory:
|
|
|
|
|
Authorised signature
|
Witness name:
|
|
|
|
|
Witness signature
|
Witness address:
|
|
|
|
|
|
2.1
|
Royalty Payments for Products.
|
1.
|
Form 10-Q/A filed with the SEC on August 13, 2018.
|
a.
|
If converting pursuant to
Sections 3(a)
or
3(b)
, upon receipt by the Transfer Agent of a copy of the executed Conversion Notice and a copy of the applicable Borrower Confirmation of Conversion Notice, the Transfer Agent shall, provided the Transfer Agent is participating in The Depository Trust Company (“
DTC
”) Fast Automated Securities Transfer Program, upon the request of ARES, credit such aggregate number of shares of Equity Securities to which ARES shall be entitled, subject to Section 4.8 of the Securities Purchase Agreement, to ARES's or its designee's balance account with DTC through its Deposit Withdrawal Agent Commission system; provided, however, in the case of a conversion pursuant to
Section 3(b)
,
no Equity Securities shall be issued in advance of the closing of the Qualified Company Financing, and provided further that if the closing of the Qualified Company Financing does not occur within
[*****]
of the Borrower’s receipt of the Conversion Notice, such Conversion Notice shall be deemed
void ab initio
and of no effect, ARES’s conversion rights with respect to such Qualified Company Financing shall be deemed not to have been exercised and a Qualified Company Financing shall be deemed not to have occurred and Borrower shall be obligated to comply with its obligations under
Section 5(a)
below and to afford ARES with its full opportunity to exercise its rights pursuant to
Section 3(b)
above before Borrower may conduct a Qualified Company Financing.
|
b.
|
If converting pursuant to
Section 3(c)
, if Precigen has received the executed Conversion Notice prior to the closing of the Precigen Financing, Precigen shall cause the aggregate number of shares of Equity Securities to which ARES shall be entitled to be recorded in the appropriate stock ledger of the Company, subject to ARES’ execution of all documents reasonably requested to be executed in connection with, and executed by other purchasers in, such Precigen Financing. If the closing of the Precigen Financing does not occur within
[*****]
of the Borrower’s receipt of such Conversion Notice, such Conversion Notice shall be deemed
void ab initio
and of no effect, and ARES’ conversion rights with respect to such Precigen Financing shall be deemed not to have been exercised, and a Qualified Precigen Financing pursuant to
Section 3(j)
shall not be deemed to have occurred.
|
c.
|
If converting pursuant to
Section 3(d)
, upon the later to occur of: (a) the Transfer Agent’s receipt of a copy of the executed Conversion Notice and a copy of the applicable Borrower Confirmation of Conversion Notice and (b) the closing of the Qualified Precigen IPO, the Transfer Agent shall, provided the Transfer Agent is participating in the DTC Fast Automated Securities Transfer Program, upon the
|
d.
|
If less than the full then-outstanding principal amount of this Note is submitted for conversion and (notwithstanding
Section 3(g)(vi)
) Borrowers have actually received the original Note pursuant to
Section 3(g)(i)
, then the Borrowers shall, as soon as practicable and in no event later than five (5) Trading Days after receipt of the Note and at Borrowers’ own expense, issue and deliver to ARES a new Note for the outstanding principal amount not converted.
|
e.
|
In the event any shares of Equity Securities to which ARES is entitled upon conversion are not eligible to be credited to ARES's or its designee's balance account with DTC through its Deposit Withdrawal Agent Commission system as set forth in this
Section 3(g)
, such Equity Securities shall be issued and promptly delivered to ARES in certificated form.
|
(a)
|
Material Transactions
. In case:
|
(b)
|
Precigen IPO.
|
(a)
|
If to ARES, at:
|
(b)
|
If to the Company, at:
|
(c)
|
If to Precigen, at:
|
INTREXON CORPORATION
|
|
|
|
By:
|
|
|
Name:
|
|
Its:
|
PRECIGEN, INC.
|
|
|
|
By:
|
|
|
Name:
|
|
Its:
|
Accepted and Agreed to:
|
|
|
|
ARES TRADING S.A.
|
|
|
|
By:
|
|
|
Name:
|
|
Its:
|
Borrower Into Whose Equity Securities the Note Principal Will Convert:
|
|
|
|
Equity Security Into Which the Note Principal Will Convert:
|
|
|
|
Conversion Date:
|
|
|
|
Aggregate outstanding principal amount of
Note
prior to
this conversion:
|
|
|
|
Aggregate principal amount to be converted (Conversion Amount):
|
|
|
|
Aggregate outstanding principal amount of
Note
after
this conversion:
|
|
Conversion Price, Qualified Company Financing Conversion Price, Precigen Financing Conversion Price or Qualified Precigen IPO Conversion Price, as applicable:
|
|
|
|
Number of shares of Equity Securities to be issued:
|
|
Issue to:
|
|
|
|
|
|
|
|
|
|
|
|
Authorized Signature:
|
|
|
|
Name:
|
|
|
Title:
|
|
|
Phone #:
|
|
|
Fax #:
|
|
Account Number
(if electronic book entry transfer):
|
|
|
|
|
|
Transaction Code Number
(if electronic book entry transfer):
|
|
By: ARES TRADING S.A.
|
|
|
|
By:
|
|
|
Name:
|
|
Its:
|
Accepted and agreed:
|
|
|
|
INTREXON CORPORATION
|
|
|
|
By:
|
|
|
Name:
|
|
Its:
|
PRECIGEN, INC.
|
|
|
|
By:
|
|
|
Name:
|
|
Its:
|
Domestic
|
|
ActoBio Therapeutics, Inc.
|
Delaware
|
ActoBio Therapeutics Holdings, Inc.
|
Delaware
|
AquaBounty Farms, Inc.
|
Delaware
|
AquaBounty Farms Indiana LLC
|
Delaware
|
AquaBounty Technologies, Inc.
|
Delaware
|
Biological & Popular Culture, Inc.
|
Delaware
|
CRS Bio, Inc.
|
Delaware
|
EnviroFlight, LLC
|
Delaware
|
Exemplar Genetics, LLC
|
Iowa
|
Fruit Orchard Holdings, Inc.
|
Delaware
|
Genomatix, Inc.
|
Delaware
|
Genten Therapeutics, Inc.
|
Delaware
|
GenVec LLC
|
Delaware
|
ILH Holdings, Inc.
|
Delaware
|
Intrexon AB, Co.
|
Delaware
|
Intrexon CEU, Inc.
|
Delaware
|
Intrexon Crop Protection, Inc.
|
Virginia
|
Intrexon EF Holdings, Inc.
|
Delaware
|
Intrexon Energy Partners, LLC
|
Delaware
|
Intrexon Energy Partners II, LLC
|
Delaware
|
Intrexon Environmental Medicine Partners, LLC
|
Delaware
|
Intrexon Produce Holdings, Inc.
|
Delaware
|
Intrexon T1D Partners, LLC
|
Delaware
|
Intrexon UK Holdings, Inc.
|
Delaware
|
MabLogix, LLC
|
Delaware
|
OvaXon, LLC
|
Delaware
|
Precigen, Inc.
|
Delaware
|
ProGentus, L.C.
|
Iowa
|
Relieve Genetics, Inc.
|
Delaware
|
Trans Ova Genetics, L.C.
|
Iowa
|
Unicell Bio International, LLC
|
Delaware
|
ViaGen, L.C.
|
Iowa
|
Xogenex LLC
|
Delaware
|
XON Cells, Inc.
|
Nevada
|
International
|
|
ActoBio Laboratories Belgium BVBA
(besloten vennootschap met beperkte aansprakelijkheid)
|
Belgium
|
AQUA Bounty Canada Inc.
|
Canada
|
Aqua Bounty Farms Chile Limitada
|
Chile
|
AquaBounty Brasil Participações Ltda.
|
Brazil
|
AquaBounty Panama, S. de R.L.
|
Panama
|
ER Cell LLC
|
Russia
|
Fruit Orchard Holdings Mexico
|
Mexico
|
Intrexon ActoBiotics NV
(naamloze vennootschap)
|
Belgium
|
Intrexon BioInformatics Germany GmbH
|
Germany
|
Intrexon Laboratories Hungary, KFT
(korlátolt felelõsségû társaság)
|
Hungary
|
Intrexon Labs Canada, Inc.
|
Canada
|
Intrexon UK Insect Holdings Limited
|
United Kingdom
|
Mosquito Technologies Limited Mexico
|
Mexico
|
Okanagan Specialty Fruits Inc.
|
British Columbia
|
Oxitec, Ltd
|
United Kingdom
|
Oxitec Australia Pty, Ltd.
|
Australia
|
Oxitec Sdn Bhd
|
Malaysia
|
Oxitec Cayman Limited
|
Cayman Islands
|
Oxitec (Singapore) PTE. Limited
|
Singapore
|
Oxitec do Brasil Tecnologia de Insetos Ltda
|
Brazil
|
Precision Biological Innovations SRL
|
Costa Rica
|
1.
|
I have reviewed this Annual Report on Form 10-K of Intrexon Corporation;
|
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 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 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.
|
/s/ RANDAL J. KIRK
|
Randal J. Kirk
Chairman and Chief Executive Officer
(Principal Executive Officer)
|
1.
|
I have reviewed this Annual Report on Form 10-K of Intrexon Corporation;
|
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 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 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.
|
/s/ RICK L. STERLING
|
Rick L. Sterling
Chief Financial Officer
(Principal Financial Officer)
|
•
|
the Annual Report on Form 10-K of the Company for the year ended
December 31, 2018
(the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
•
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/ RANDAL J. KIRK
|
Randal J. Kirk
|
Chairman and Chief Executive Officer
|
(Principal Executive Officer)
|
•
|
the Annual Report on Form 10-K of the Company for the year ended
December 31, 2018
(the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
•
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/ RICK L. STERLING
|
Rick L. Sterling
|
Chief Financial Officer
|
(Principal Financial Officer)
|