|
☑
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
Delaware
|
|
27-4842691
|
|
|
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. Employer Identification No.)
|
|
|
N/A
|
|
|
Former name, former address and former fiscal year, if changed since last report
|
|
|
Title of each class
|
Trading Symbol(s)
|
Name of each exchange on which registered
|
|
|
Common Stock, par value $0.0001 per share
|
RTRX
|
The Nasdaq Global Market
|
|
Large accelerated filer
|
☑
|
Accelerated filer
|
☐
|
Non-accelerated filer
|
☐
|
Smaller reporting company
|
☐
|
|
|
Emerging growth company
|
☐
|
|
|
|
Page No.
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
|
|
|
||
|
March 31, 2020
|
|
December 31, 2019
|
||||
Assets
|
(unaudited)
|
|
|
|
|||
Current assets:
|
|
|
|
|
|
||
Cash and cash equivalents
|
$
|
67,019
|
|
|
$
|
62,436
|
|
Available-for-sale debt securities, at fair value (amortized cost $290,977, allowance for credit losses of $0 as of March 31, 2020; amortized cost $335,206, allowance for credit losses of $0 as of December 31, 2019)
|
289,441
|
|
|
336,088
|
|
||
Accounts receivable, net
|
18,085
|
|
|
18,048
|
|
||
Inventory, net
|
6,593
|
|
|
6,082
|
|
||
Prepaid expenses and other current assets
|
5,309
|
|
|
5,015
|
|
||
Tax receivable
|
20,183
|
|
|
1,395
|
|
||
Total current assets
|
406,630
|
|
|
429,064
|
|
||
Property and equipment, net
|
2,617
|
|
|
2,891
|
|
||
Other non-current assets
|
6,803
|
|
|
14,709
|
|
||
Intangible assets, net
|
156,077
|
|
|
157,200
|
|
||
Goodwill
|
936
|
|
|
936
|
|
||
Total assets
|
$
|
573,063
|
|
|
$
|
604,800
|
|
Liabilities and Stockholders' Equity
|
|
|
|
|
|
||
Current liabilities:
|
|
|
|
|
|
||
Accounts payable
|
$
|
9,966
|
|
|
$
|
26,614
|
|
Accrued expenses
|
41,590
|
|
|
51,745
|
|
||
Other current liabilities
|
8,435
|
|
|
8,590
|
|
||
Business combination-related contingent consideration
|
8,100
|
|
|
8,500
|
|
||
Total current liabilities
|
68,091
|
|
|
95,449
|
|
||
2025 Convertible debt
|
207,412
|
|
|
204,861
|
|
||
Other non-current liabilities
|
13,312
|
|
|
20,894
|
|
||
Business combination-related contingent consideration, less current portion
|
58,500
|
|
|
62,400
|
|
||
Total liabilities
|
347,315
|
|
|
383,604
|
|
||
Stockholders' Equity:
|
|
|
|
|
|
||
Preferred stock $0.0001 par value; 20,000,000 shares authorized; 0 issued and outstanding as of March 31, 2020 and December 31, 2019
|
—
|
|
|
—
|
|
||
Common stock $0.0001 par value; 100,000,000 shares authorized; 43,153,215 and 43,088,921 issued and outstanding as of March 31, 2020 and December 31, 2019, respectively
|
4
|
|
|
4
|
|
||
Additional paid-in capital
|
642,880
|
|
|
636,910
|
|
||
Accumulated deficit
|
(415,636
|
)
|
|
(416,444
|
)
|
||
Accumulated other comprehensive income (loss)
|
(1,500
|
)
|
|
726
|
|
||
Total stockholders' equity
|
225,748
|
|
|
221,196
|
|
||
Total liabilities and stockholders' equity
|
$
|
573,063
|
|
|
$
|
604,800
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Net product sales
|
$
|
47,769
|
|
|
$
|
39,570
|
|
Operating expenses:
|
|
|
|
||||
Cost of goods sold
|
1,370
|
|
|
1,017
|
|
||
Research and development
|
30,249
|
|
|
33,443
|
|
||
Selling, general and administrative
|
33,139
|
|
|
32,669
|
|
||
Change in fair value of contingent consideration
|
(1,922
|
)
|
|
3,169
|
|
||
Write off of L-UDCA IPR&D intangible asset
|
—
|
|
|
25,500
|
|
||
Write off of L-UDCA contingent consideration
|
—
|
|
|
(18,000
|
)
|
||
Total operating expenses
|
62,836
|
|
|
77,798
|
|
||
Operating loss
|
(15,067
|
)
|
|
(38,228
|
)
|
||
Other income (expenses), net:
|
|
|
|
||||
Other expense, net
|
(190
|
)
|
|
(302
|
)
|
||
Interest income
|
1,976
|
|
|
2,819
|
|
||
Interest expense
|
(4,887
|
)
|
|
(4,865
|
)
|
||
Total other expense, net
|
(3,101
|
)
|
|
(2,348
|
)
|
||
Loss before income taxes
|
(18,168
|
)
|
|
(40,576
|
)
|
||
Income tax benefit (expense)
|
18,976
|
|
|
(401
|
)
|
||
Net income (loss)
|
$
|
808
|
|
|
$
|
(40,977
|
)
|
|
|
|
|
|
|
||
Net income (loss) per common share, basic
|
$
|
0.02
|
|
|
$
|
(0.99
|
)
|
Net income (loss) per common share, diluted
|
0.02
|
|
|
(0.99
|
)
|
||
Weighted average common shares outstanding, basic
|
43,122,897
|
|
|
41,410,314
|
|
||
Weighted average common shares outstanding, diluted
|
43,592,499
|
|
|
41,410,314
|
|
||
Comprehensive loss:
|
|
|
|
||||
Net income (loss)
|
$
|
808
|
|
|
$
|
(40,977
|
)
|
Foreign currency translation
|
191
|
|
|
117
|
|
||
Unrealized gain (loss) on marketable securities
|
(2,417
|
)
|
|
1,469
|
|
||
Comprehensive loss
|
$
|
(1,418
|
)
|
|
$
|
(39,391
|
)
|
|
For the Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Cash Flows From Operating Activities:
|
|
|
|
||||
Net income (loss)
|
$
|
808
|
|
|
$
|
(40,977
|
)
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
|
|
|
|
|
||
Depreciation and amortization
|
5,656
|
|
|
4,901
|
|
||
Non-cash interest expense
|
517
|
|
|
350
|
|
||
(Accretion) amortization of discounts/premiums on investments, net
|
138
|
|
|
(343
|
)
|
||
Amortization of debt discount and issuance costs
|
2,551
|
|
|
2,459
|
|
||
Provision for Inventory
|
420
|
|
|
189
|
|
||
Share based compensation
|
5,910
|
|
|
6,271
|
|
||
Change in fair value of contingent consideration
|
(1,922
|
)
|
|
(14,831
|
)
|
||
Payments related to change in fair value of contingent consideration
|
(6,971
|
)
|
|
(1,405
|
)
|
||
Write off of IPR&D intangible assets
|
—
|
|
|
25,500
|
|
||
Other
|
(25
|
)
|
|
62
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
|
|
||
Accounts receivable
|
(61
|
)
|
|
40
|
|
||
Inventory
|
(958
|
)
|
|
(170
|
)
|
||
Tax receivable
|
(18,788
|
)
|
|
304
|
|
||
Other current and non-current operating assets
|
7,666
|
|
|
(9,625
|
)
|
||
Accounts payable and accrued expenses
|
(16,577
|
)
|
|
(3,103
|
)
|
||
Other current and non-current operating liabilities
|
(7,519
|
)
|
|
9,886
|
|
||
Net cash used in operating activities
|
(29,155
|
)
|
|
(20,492
|
)
|
||
Cash Flows From Investing Activities:
|
|
|
|
|
|
||
Purchase of fixed assets
|
(208
|
)
|
|
(19
|
)
|
||
Cash paid for intangible assets
|
(4,406
|
)
|
|
(3,961
|
)
|
||
Proceeds from the sale/maturity of marketable securities
|
49,153
|
|
|
72,990
|
|
||
Purchase of marketable securities
|
(4,988
|
)
|
|
(80,422
|
)
|
||
Net cash provided by (used in) investing activities
|
39,551
|
|
|
(11,412
|
)
|
||
Cash Flows From Financing Activities:
|
|
|
|
|
|
||
Payment of acquisition-related contingent consideration
|
(5,308
|
)
|
|
(905
|
)
|
||
Payment of guaranteed minimum royalty
|
(525
|
)
|
|
(509
|
)
|
||
Proceeds from exercise of stock options
|
60
|
|
|
304
|
|
||
Net cash used in financing activities
|
(5,773
|
)
|
|
(1,110
|
)
|
||
Effect of exchange rate changes on cash
|
(40
|
)
|
|
(21
|
)
|
||
Net change in cash and cash equivalents
|
4,583
|
|
|
(33,035
|
)
|
||
Cash and cash equivalents, beginning of year
|
62,436
|
|
|
102,873
|
|
||
Cash and cash equivalents, end of period
|
$
|
67,019
|
|
|
$
|
69,838
|
|
|
Three Months Ended March 31, 2020
|
|
Three Months Ended March 31, 2019
|
||||||||||||||||||||||||||||||||||||||||
|
Common Stock
|
|
Additional Paid in Capital
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Accumulated
Deficit |
|
Total
Stockholders' Equity |
|
Common Stock
|
|
Additional Paid in Capital
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Accumulated
Deficit |
|
Total
Stockholders' Equity |
||||||||||||||||||||||||
|
Shares
|
Amount
|
|
|
|
|
|
Shares
|
Amount
|
|
|
|
|
||||||||||||||||||||||||||||||
Balance - December 31
|
43,088,921
|
|
$
|
4
|
|
|
$
|
636,910
|
|
|
$
|
726
|
|
|
$
|
(416,444
|
)
|
|
$
|
221,196
|
|
|
41,389,524
|
|
$
|
4
|
|
|
$
|
589,795
|
|
|
$
|
(1,529
|
)
|
|
$
|
(270,017
|
)
|
|
$
|
318,253
|
|
Share based compensation
|
|
|
|
5,714
|
|
|
|
|
|
|
5,714
|
|
|
|
|
|
6,370
|
|
|
|
|
|
|
6,370
|
|
||||||||||||||||||
Issuance of common shares under the equity incentive plan and proceeds from exercise
|
64,294
|
|
|
|
60
|
|
|
|
|
|
|
60
|
|
|
48,496
|
|
|
|
304
|
|
|
|
|
|
|
304
|
|
||||||||||||||||
Unrealized gain (loss) on marketable securities
|
|
|
|
|
|
(2,417
|
)
|
|
|
|
(2,417
|
)
|
|
|
|
|
|
|
1,469
|
|
|
|
|
1,469
|
|
||||||||||||||||||
Foreign currency translation adjustments
|
|
|
|
|
|
191
|
|
|
|
|
191
|
|
|
|
|
|
|
|
117
|
|
|
|
|
117
|
|
||||||||||||||||||
ESPP stock purchase and expense
|
|
|
|
196
|
|
|
|
|
|
|
196
|
|
|
|
|
|
175
|
|
|
|
|
|
|
175
|
|
||||||||||||||||||
Net income (loss)
|
|
|
|
|
|
|
|
808
|
|
|
808
|
|
|
|
|
|
|
|
|
|
(40,977
|
)
|
|
(40,977
|
)
|
||||||||||||||||||
Balance - March 31
|
43,153,215
|
|
$
|
4
|
|
|
$
|
642,880
|
|
|
$
|
(1,500
|
)
|
|
$
|
(415,636
|
)
|
|
$
|
225,748
|
|
|
41,438,020
|
|
$
|
4
|
|
|
$
|
596,644
|
|
|
$
|
57
|
|
|
$
|
(310,994
|
)
|
|
$
|
285,711
|
|
•
|
Focal segmental glomerulosclerosis ("FSGS") is a rare kidney disease characterized by proteinuria where the glomeruli become progressively scarred. FSGS is a leading cause of end-stage renal disease.
|
•
|
Immunoglobulin A nephropathy ("IgAN") is an immune-complex-mediated glomerulonephritis characterized by hematuria, proteinuria, and variable rates of progressive renal failure. IgAN is the most common primary glomerular disease.
|
•
|
Chenodal (chenodiol tablets) is approved in the United States for the treatment of patients suffering from gallstones in whom surgery poses an unacceptable health risk due to disease or advanced age. Chenodal has been the standard of care for CTX patients for more than three decades.
|
•
|
Cholbam® (cholic acid capsules) is approved in the United States for the treatment of bile acid synthesis disorders due to single enzyme defects and is further indicated for adjunctive treatment of patients with peroxisomal disorders.
|
•
|
Thiola® and Thiola EC® (tiopronin tablets) are approved in the United States for the prevention of cystine (kidney) stone formation in patients with severe homozygous cystinuria.
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2020
|
|
2019
|
||||
Bile acid products
|
|
$
|
22,281
|
|
|
$
|
18,390
|
|
Tiopronin products
|
|
25,488
|
|
|
21,180
|
|
||
Total net product revenue
|
|
$
|
47,769
|
|
|
$
|
39,570
|
|
|
March 31, 2020
|
|
December 31, 2019
|
||||
Commercial paper
|
$
|
17,211
|
|
|
$
|
17,152
|
|
Corporate debt securities
|
267,226
|
|
|
306,436
|
|
||
Securities of government sponsored entities
|
5,004
|
|
|
12,500
|
|
||
Total marketable securities:
|
$
|
289,441
|
|
|
$
|
336,088
|
|
|
Remaining Contractual Maturity
(in years) |
|
Amortized Cost
|
|
Unrealized Gains
|
|
Unrealized Losses
|
|
Aggregate Estimated Fair Value
|
||||||||
Commercial paper
|
Less than 1
|
|
$
|
17,210
|
|
|
$
|
11
|
|
|
$
|
(10
|
)
|
|
$
|
17,211
|
|
Corporate debt securities
|
Less than 1
|
|
186,057
|
|
|
177
|
|
|
(597
|
)
|
|
185,637
|
|
||||
Total maturity less than 1 year
|
|
|
203,267
|
|
|
188
|
|
|
(607
|
)
|
|
202,848
|
|
||||
Corporate debt securities
|
1 to 2
|
|
82,710
|
|
|
22
|
|
|
(1,143
|
)
|
|
81,589
|
|
||||
Securities of government-sponsored entities
|
1 to 2
|
|
5,000
|
|
|
4
|
|
|
—
|
|
|
5,004
|
|
||||
Total maturity 1 to 2 years
|
|
|
87,710
|
|
|
26
|
|
|
(1,143
|
)
|
|
86,593
|
|
||||
Total available-for-sale securities
|
|
|
$
|
290,977
|
|
|
$
|
214
|
|
|
$
|
(1,750
|
)
|
|
$
|
289,441
|
|
|
Remaining Contractual Maturity
(in years)
|
|
Amortized Cost
|
|
Unrealized Gains
|
|
Unrealized Losses
|
|
Aggregate Estimated Fair Value
|
||||||||
Commercial paper
|
Less than 1
|
|
$
|
17,136
|
|
|
$
|
16
|
|
|
$
|
—
|
|
|
$
|
17,152
|
|
Corporate debt securities
|
Less than 1
|
|
191,770
|
|
|
582
|
|
|
(10
|
)
|
|
192,342
|
|
||||
Total maturity less than 1 year
|
|
|
208,906
|
|
|
598
|
|
|
(10
|
)
|
|
209,494
|
|
||||
Corporate debt securities
|
1 to 2
|
|
113,799
|
|
|
351
|
|
|
(56
|
)
|
|
114,094
|
|
||||
Securities of government-sponsored entities
|
1 to 2
|
|
12,501
|
|
|
—
|
|
|
(1
|
)
|
|
12,500
|
|
||||
Total maturity 1 to 2 years
|
|
|
126,300
|
|
|
351
|
|
|
(57
|
)
|
|
126,594
|
|
||||
Total available-for-sale securities
|
|
|
$
|
335,206
|
|
|
$
|
949
|
|
|
$
|
(67
|
)
|
|
$
|
336,088
|
|
|
|
Less Than 12 Months
|
|
12 Months or Greater
|
|
Total
|
||||||||||||||||||
Description of Securities
|
|
Fair Value
|
|
Unrealized Losses
|
|
Fair Value
|
|
Unrealized Losses
|
|
Fair Value
|
|
Unrealized Losses
|
||||||||||||
Commercial paper
|
|
$
|
4,981
|
|
|
$
|
10
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4,981
|
|
|
$
|
10
|
|
Corporate debt securities
|
|
203,276
|
|
|
1,740
|
|
|
—
|
|
|
—
|
|
|
203,276
|
|
|
1,740
|
|
||||||
Securities of government-sponsored entities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Total
|
|
$
|
208,257
|
|
|
$
|
1,750
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
208,257
|
|
|
$
|
1,750
|
|
|
|
Less Than 12 Months
|
|
12 Months or Greater
|
|
Total
|
||||||||||||||||||
Description of Securities
|
|
Fair Value
|
|
Unrealized Losses
|
|
Fair Value
|
|
Unrealized Losses
|
|
Fair Value
|
|
Unrealized Losses
|
||||||||||||
Commercial paper
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Corporate debt securities
|
|
74,151
|
|
|
64
|
|
|
7,509
|
|
|
2
|
|
|
81,660
|
|
|
66
|
|
||||||
Securities of government-sponsored entities
|
|
5,000
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
5,000
|
|
|
1
|
|
||||||
Total
|
|
$
|
79,151
|
|
|
$
|
65
|
|
|
$
|
7,509
|
|
|
$
|
2
|
|
|
$
|
86,660
|
|
|
$
|
67
|
|
|
March 31, 2020
|
||
2020
|
$
|
1,936
|
|
2021
|
622
|
|
|
2022
|
—
|
|
|
2023
|
—
|
|
|
2024
|
—
|
|
|
Thereafter
|
—
|
|
|
Total undiscounted future minimum payments
|
2,558
|
|
|
Present value discount
|
(100
|
)
|
|
Total lease liability
|
2,458
|
|
|
Lease incentives
|
(1,144
|
)
|
|
Cash payments in excess of straight-line lease expense
|
(1,314
|
)
|
|
Total ROU asset
|
$
|
—
|
|
|
March 31, 2020
|
||
Other current liabilities
|
$
|
2,458
|
|
Other non-current liabilities
|
—
|
|
|
Total lease liabilities
|
$
|
2,458
|
|
|
As of March 31, 2020
|
||||||||||||||
|
Total carrying and estimated fair value
|
|
Quoted prices in active markets
(Level 1) |
|
Significant other observable inputs (Level 2)
|
|
Significant unobservable inputs (Level 3)
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Cash and Cash Equivalents
|
$
|
67,019
|
|
|
$
|
67,019
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Marketable securities, available-for-sale
|
289,441
|
|
|
—
|
|
|
289,441
|
|
|
—
|
|
||||
Total
|
$
|
356,460
|
|
|
$
|
67,019
|
|
|
$
|
289,441
|
|
|
$
|
—
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Business combination-related contingent consideration
|
$
|
66,600
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
66,600
|
|
Total
|
$
|
66,600
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
66,600
|
|
|
As of December 31, 2019
|
||||||||||||||
|
Total carrying and estimated fair value
|
|
Quoted prices in active markets
(Level 1)
|
|
Significant other observable inputs (Level 2)
|
|
Significant unobservable inputs (Level 3)
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Cash and Cash Equivalents
|
$
|
62,436
|
|
|
$
|
62,436
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Marketable securities, available-for-sale
|
336,088
|
|
|
—
|
|
|
336,088
|
|
|
—
|
|
||||
Total
|
$
|
398,524
|
|
|
$
|
62,436
|
|
|
$
|
336,088
|
|
|
$
|
—
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Business combination-related contingent consideration
|
70,900
|
|
|
—
|
|
|
—
|
|
|
70,900
|
|
||||
Total
|
$
|
70,900
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
70,900
|
|
|
Fair Value Measurements of Acquisition-Related Contingent Consideration
(Level 3) |
||
Balance at January 1, 2020
|
$
|
70,900
|
|
Changes in the fair value of contingent consideration
|
(1,922
|
)
|
|
Contractual payments included in accrued liabilities at March 31, 2020
|
(2,278
|
)
|
|
Foreign currency impact
|
(100
|
)
|
|
Balance at March 31, 2020
|
$
|
66,600
|
|
|
March 31, 2020
|
|
December 31, 2019
|
||||
Finite-lived intangible assets
|
$
|
249,783
|
|
|
$
|
245,802
|
|
Less: accumulated amortization
|
(93,706
|
)
|
|
(88,602
|
)
|
||
Net carrying value
|
$
|
156,077
|
|
|
$
|
157,200
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Research and development
|
$
|
289
|
|
|
$
|
286
|
|
Selling, general and administrative
|
4,885
|
|
|
4,445
|
|
||
Total amortization expense
|
$
|
5,174
|
|
|
$
|
4,731
|
|
|
March 31, 2020
|
|
December 31, 2019
|
||||
2.50% convertible senior notes due 2025
|
$
|
276,000
|
|
|
$
|
276,000
|
|
Unamortized debt discount
|
(63,636
|
)
|
|
(65,963
|
)
|
||
Unamortized debt issuance costs
|
(4,952
|
)
|
|
(5,176
|
)
|
||
Total 2025 Notes, net of unamortized debt discount and debt issuance costs
|
$
|
207,412
|
|
|
$
|
204,861
|
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2020
|
|
2019
|
||||
Contractual interest expense
|
|
$
|
1,725
|
|
|
$
|
1,725
|
|
Amortization of debt discount
|
|
2,326
|
|
|
2,155
|
|
||
Amortization of debt issuance costs
|
|
224
|
|
|
224
|
|
||
Total interest expense for the 2025 Notes
|
|
$
|
4,275
|
|
|
$
|
4,104
|
|
|
March 31, 2020
|
|
December 31, 2019
|
||||
Government rebates payable
|
$
|
7,945
|
|
|
$
|
6,584
|
|
Compensation related costs
|
7,830
|
|
|
14,045
|
|
||
Accrued royalties and contingent consideration
|
7,199
|
|
|
7,272
|
|
||
Research and development
|
12,481
|
|
|
16,067
|
|
||
Selling, general and administrative
|
4,363
|
|
|
3,552
|
|
||
Miscellaneous accrued
|
1,772
|
|
|
4,225
|
|
||
Total accrued expenses
|
$
|
41,590
|
|
|
$
|
51,745
|
|
|
Three Months Ended March 31,
|
||||||||||||||||||||
|
2020
|
|
2019
|
||||||||||||||||||
|
Shares
|
|
Net Income
|
|
EPS
|
|
Shares
|
|
Net Loss
|
|
EPS
|
||||||||||
Basic income (loss) per share
|
43,122,897
|
|
|
$
|
808
|
|
|
$
|
0.02
|
|
|
41,410,314
|
|
|
$
|
(40,977
|
)
|
|
$
|
(0.99
|
)
|
ESPP
|
16,636
|
|
|
$
|
—
|
|
|
|
|
—
|
|
|
$
|
—
|
|
|
|
||||
Restricted Stock
|
75,044
|
|
|
$
|
—
|
|
|
|
|
—
|
|
|
$
|
—
|
|
|
|
||||
Stock Options
|
377,922
|
|
|
$
|
—
|
|
|
|
|
—
|
|
|
$
|
—
|
|
|
|
||||
Diluted income (loss) per share
|
43,592,499
|
|
|
$
|
808
|
|
|
$
|
0.02
|
|
|
41,410,314
|
|
|
$
|
(40,977
|
)
|
|
$
|
(0.99
|
)
|
|
Three Months Ended March 31,
|
||||
|
2020
|
|
2019
|
||
Restricted stock units
|
945,987
|
|
|
549,351
|
|
Convertible debt
|
7,113,402
|
|
|
8,410,932
|
|
Options
|
6,748,175
|
|
|
7,654,021
|
|
Total anti-dilutive shares
|
14,807,564
|
|
|
16,614,304
|
|
|
Number of Restricted Stock Units
|
|
Weighted Average Grant Date Fair Value
|
|||
Unvested December 31, 2019
|
763,728
|
|
|
$
|
19.64
|
|
Granted
|
585,188
|
|
|
15.51
|
|
|
Vested
|
(26,044
|
)
|
|
21.95
|
|
|
Forfeited/canceled
|
(42,089
|
)
|
|
18.67
|
|
|
Unvested March 31, 2020
|
1,280,783
|
|
|
$
|
17.74
|
|
|
Number of Restricted Stock Units
|
|
Weighted Average Grant Date Fair Value
|
|||
Unvested December 31, 2019
|
233,500
|
|
|
$
|
20.90
|
|
Granted
|
150,000
|
|
|
15.46
|
|
|
Vested
|
(33,250
|
)
|
|
25.75
|
|
|
Forfeited/canceled
|
—
|
|
|
—
|
|
|
Unvested March 31, 2020
|
350,250
|
|
|
$
|
18.11
|
|
|
Shares Underlying Options
|
|
Weighted Average Exercise Price
|
|
Weighted Average Remaining Contractual Life (years)
|
|
Aggregate Intrinsic Value (in thousands)
|
|||
Outstanding at December 31, 2019
|
7,371,733
|
|
|
$19.52
|
|
6.63
|
|
$
|
4,906
|
|
Granted
|
1,259,625
|
|
|
|
|
|
|
|
||
Exercised
|
(5,000
|
)
|
|
|
|
|
|
|
||
Forfeited/canceled
|
(107,415
|
)
|
|
|
|
|
|
|
||
Outstanding at March 31, 2020
|
8,518,943
|
|
|
$18.93
|
|
6.78
|
|
$
|
5,504
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Research and development
|
$
|
2,126
|
|
|
$
|
1,670
|
|
Selling, general & administrative
|
3,784
|
|
|
4,850
|
|
||
Total
|
$
|
5,910
|
|
|
$
|
6,520
|
|
|
March 31, 2020
|
|
December 31, 2019
|
||||
Raw materials
|
$
|
3,085
|
|
|
$
|
2,713
|
|
Finished goods
|
3,508
|
|
|
3,369
|
|
||
Total inventory
|
$
|
6,593
|
|
|
$
|
6,082
|
|
•
|
Focal segmental glomerulosclerosis ("FSGS"), a leading cause of end-stage renal disease and nephrotic syndrome (“NS”). There are currently no United States Food and Drug Administration ("FDA") approved pharmacologic treatments for FSGS and off-label treatments are limited to ACE/ARBs, steroids, and immunosuppressant agents, which are effective in only a subset of patients. Every year approximately 5,400 patients are diagnosed with FSGS and we estimate that there are up to 40,000 FSGS patients in the United States and a similar number in Europe with approximately half of them being candidates for sparsentan. Sparsentan has orphan drug designation in the United States and European Union. In 2016, we generated positive data from our Phase 2 DUET study in FSGS. In 2018, we announced the initiation of the Phase 3 DUPLEX Study of sparsentan in FSGS. The Company continues to enroll patients with FSGS in the pivotal Phase 3 DUPLEX Study, a global, randomized, multicenter, double-blind, parallel-arm, active-controlled, clinical trial evaluating the safety and efficacy of sparsentan in approximately 300 patients. The DUPLEX Study protocol provides for an unblinded analysis of at least 190 patients to be performed after 36 weeks of treatment to evaluate the interim efficacy endpoint - the proportion of patients achieving a FSGS partial remission of proteinuria endpoint (FPRE), which is defined as urine protein-to-creatinine ratio (Up/C) ≤1.5 g/g and a >40 percent reduction in Up/C from baseline, at week 36. While the confirmatory endpoint of the study is the change in slope of estimated glomerular filtration rate (eGFR) after 108 weeks of treatment, successful achievement of the interim 36-week proteinuria endpoint is expected to serve as the basis for submission of a New Drug Application ("NDA") under the Subpart H accelerated approval pathway in the U.S. and Conditional Marketing Authorization ("CMA") consideration in Europe. Top-line data from the interim analysis are expected to become available in the first quarter of 2021, which timelines may need to be adjusted as a result of the COVID-19 pandemic once the impact of the pandemic is better known.
|
•
|
Immunoglobulin A nephropathy ("IgAN") is characterized by hematuria, proteinuria, and variable rates of progressive renal failure. With an estimated prevalence of more than 100,000 people in the United States and greater numbers in Europe and Asia, IgAN is the most common primary glomerular disease. Most patients are diagnosed between the ages of 16 and 35, with up to 40% progressing to end stage renal disease within 15 years. There are currently no FDA approved treatments for IgAN. The current standard of care is renin-angiotensin-aldosterone system ("RAAS") blockade with immunosuppression also being commonly used for patients with significant
|
|
Three Months Ended March 31,
|
||||||||||
|
2020
|
|
2019
|
|
Change
|
||||||
Net product revenues by product:
|
|
|
|
|
|
||||||
Bile acid products
|
$
|
22,281
|
|
|
$
|
18,390
|
|
|
$
|
3,891
|
|
Tiopronin products
|
25,488
|
|
|
21,180
|
|
|
4,308
|
|
|||
Total net product revenues
|
$
|
47,769
|
|
|
$
|
39,570
|
|
|
$
|
8,199
|
|
|
Three Months Ended March 31,
|
||||||||||
|
2020
|
|
2019
|
|
Change
|
||||||
Cost of goods sold
|
$
|
1,370
|
|
|
$
|
1,017
|
|
|
$
|
353
|
|
Research and development
|
30,249
|
|
|
33,443
|
|
|
(3,194
|
)
|
|||
Selling, general and administrative
|
33,139
|
|
|
32,669
|
|
|
470
|
|
|||
Change in fair value of contingent consideration
|
(1,922
|
)
|
|
3,169
|
|
|
(5,091
|
)
|
|||
Write off of L-UDCA IPR&D intangible asset
|
—
|
|
|
25,500
|
|
|
(25,500
|
)
|
|||
Write off of L-UDCA contingent consideration
|
—
|
|
|
(18,000
|
)
|
|
18,000
|
|
|||
|
$
|
62,836
|
|
|
$
|
77,798
|
|
|
$
|
(14,962
|
)
|
|
Three Months Ended March 31,
|
||||||||||
|
2020
|
|
2019
|
|
Change
|
||||||
Other income (expense), net
|
$
|
(190
|
)
|
|
$
|
(302
|
)
|
|
$
|
112
|
|
Interest income
|
1,976
|
|
|
2,819
|
|
|
(843
|
)
|
|||
Interest expense
|
(4,887
|
)
|
|
(4,865
|
)
|
|
(22
|
)
|
|||
|
$
|
(3,101
|
)
|
|
$
|
(2,348
|
)
|
|
$
|
(753
|
)
|
|
March 31, 2020
|
|
December 31, 2019
|
||||
Cash & Cash Equivalents
|
$
|
67,019
|
|
|
$
|
62,436
|
|
Marketable securities
|
289,441
|
|
|
336,088
|
|
||
Accumulated Deficit
|
(415,636
|
)
|
|
(416,444
|
)
|
||
Stockholders' Equity
|
225,748
|
|
|
221,196
|
|
||
Net Working Capital*
|
$
|
338,539
|
|
|
$
|
333,615
|
|
Net Working Capital Ratio**
|
5.97
|
|
|
4.50
|
|
|
March 31, 2020
|
|
December 31, 2019
|
||||
2.50% convertible senior notes due 2025
|
$
|
276,000
|
|
|
$
|
276,000
|
|
Unamortized debt discount
|
(63,636
|
)
|
|
(65,963
|
)
|
||
Unamortized debt issuance costs
|
(4,952
|
)
|
|
(5,176
|
)
|
||
Total 2025 Notes, net of unamortized debt discount and debt issuance costs
|
$
|
207,412
|
|
|
$
|
204,861
|
|
•
|
increases or decreases in revenue from our marketed products, including decreases in revenue resulting from the COVID-19 pandemic;
|
•
|
the rate of progress and cost of our clinical trials, preclinical studies and other discovery and research and development activities, including any delays resulting from the COVID-19 pandemic;
|
•
|
the timing of, and costs involved in, seeking and obtaining marketing approvals for our products, and in maintaining quality systems standards for our products;
|
•
|
debt service obligations on the 2025 Notes;
|
•
|
our ability to manufacture sufficient quantities of our products to meet expected demand;
|
•
|
the costs of preparing, filing, prosecuting, maintaining and enforcing any patent claims and other intellectual property rights, litigation costs and the results of litigation;
|
•
|
our ability to enter into collaboration, licensing or distribution arrangements and the terms and timing of these arrangements;
|
•
|
the potential need to expand our business, resulting in additional payroll and other overhead expenses;
|
•
|
the potential in-licensing of other products or technologies; and
|
•
|
the emergence of competing technologies or other adverse market or technological developments.
|
•
|
our preclinical or nonclinical tests or clinical trials may produce negative or inconclusive results, and we may decide, or regulators may require us, to conduct additional preclinical testing or clinical trials or we may abandon projects that we expect to be promising;
|
•
|
regulators may require us to conduct studies of the long-term effects associated with the use of our product candidates;
|
•
|
regulators or institutional review boards may not authorize us to commence a clinical trial or conduct a clinical trial at a prospective trial site;
|
•
|
the FDA or any non-United States regulatory authority may impose conditions on us regarding the scope or design of our clinical trials or may require us to resubmit our clinical trial protocols to institutional review boards for re-inspection due to changes in the regulatory environment;
|
•
|
the number of patients required for our clinical trials may be larger than we anticipate or participants may drop out of our clinical trials at a higher rate than we anticipate;
|
•
|
our third-party contractors or clinical investigators may fail to comply with regulatory requirements or fail to meet their contractual obligations to us in a timely manner;
|
•
|
we might have to suspend or terminate one or more of our clinical trials if we, regulators or institutional review boards determine that the participants are being exposed to unacceptable health risks;
|
•
|
regulators or institutional review boards may require that we hold, suspend or terminate clinical research for various reasons, including noncompliance with regulatory requirements;
|
•
|
the cost of our clinical trials may be greater than we anticipate;
|
•
|
the supply or quality of our product candidates or other materials necessary to conduct our clinical trials may be insufficient or inadequate or we may not be able to reach agreements on acceptable terms with prospective clinical research organizations; and
|
•
|
the effects of our product candidates may not be the desired effects or may include undesirable side effects or the product candidates may have other unexpected characteristics.
|
•
|
be delayed in obtaining, or may not be able to obtain, marketing approval for one or more of our product candidates;
|
•
|
obtain approval for indications that are not as broad as intended or entirely different than those indications for which we sought approval; and
|
•
|
have the product removed from the market after obtaining marketing approval.
|
•
|
restrictions on the marketing, manufacturing, or distribution of the product;
|
•
|
requirements to include additional warnings on the label;
|
•
|
requirements to create or enhance a medication guide outlining the risks to patients;
|
•
|
withdrawal of the product from the market;
|
•
|
voluntary or mandatory product recalls;
|
•
|
requirements to change the way the product is administered or for us to conduct additional clinical trials;
|
•
|
fines, warning or untitled letters or holds on clinical trials;
|
•
|
refusal by the FDA to approve pending applications or supplements to approved applications filed by us or our strategic partners, or suspension or revocation of product license approvals;
|
•
|
product seizure or detention, or refusal to permit the import or export of products;
|
•
|
injunctions or the imposition of civil or criminal penalties; and
|
•
|
harm to our reputation.
|
•
|
inability of sales personnel to obtain access to or convince adequate numbers of physicians to prescribe our products;
|
•
|
inability to recruit, retain and effectively manage adequate numbers of effective sales personnel;
|
•
|
lack of complementary products to be offered by sales personnel, which may put us at a competitive disadvantage relative to companies that have more extensive product lines; and
|
•
|
unforeseen delays, costs and expenses associated with maintaining our sales organization.
|
•
|
the prevalence and severity of any side effects, including any limitations or warnings contained in a product’s approved labeling;
|
•
|
the efficacy and potential advantages over alternative treatments;
|
•
|
the pricing of our product candidates;
|
•
|
relative convenience and ease of administration;
|
•
|
the willingness of the target patient population to try new therapies and of physicians to prescribe these therapies;
|
•
|
the strength of marketing and distribution support and timing of market introduction of competitive products;
|
•
|
publicity concerning our products or competing products and treatments; and
|
•
|
sufficient third-party insurance coverage and reimbursement.
|
•
|
regulatory authorities may require the addition of restrictive labeling statements;
|
•
|
regulatory authorities may withdraw their approval of the product; and
|
•
|
we may be required to change the way the product is administered or conduct additional clinical trials.
|
•
|
we or our licensors were the first to make the inventions covered by each of our pending patent applications;
|
•
|
we or our licensors were the first to file patent applications for these inventions;
|
•
|
others will not independently develop similar or alternative technologies or duplicate any of our technologies;
|
•
|
any patents issued to us or our licensors that provide a basis for commercially viable products will provide us with any competitive advantages or will not be challenged by third parties;
|
•
|
we will develop additional proprietary technologies that are patentable;
|
•
|
we will file patent applications for new proprietary technologies promptly or at all;
|
•
|
the claims we make in our patents will be upheld by patent offices in the United States and elsewhere;
|
•
|
our patents will not expire prior to or shortly after commencing commercialization of a product; and
|
•
|
the patents of others will not have a negative effect on our ability to do business.
|
•
|
a covered benefit under its health plan;
|
•
|
safe, effective and medically necessary;
|
•
|
appropriate for the specific patient;
|
•
|
cost-effective; and
|
•
|
neither experimental nor investigational.
|
•
|
reliance on the third party for regulatory compliance and quality assurance;
|
•
|
limitations on supply availability resulting from capacity and scheduling constraints of the third parties;
|
•
|
impact on our reputation in the marketplace if manufacturers of our products fail to meet the demands of our customers;
|
•
|
the possible breach of the manufacturing agreement by the third party because of factors beyond our control; and
|
•
|
the possible termination or nonrenewal of the agreement by the third party, based on its own business priorities, at a time that is costly or inconvenient for us.
|
•
|
our inability to recruit and retain adequate numbers of effective sales and marketing personnel;
|
•
|
the inability of sales personnel to obtain access to or educate adequate numbers of physicians to prescribe our products;
|
•
|
the lack of complementary products to be offered by our sales personnel, which may put us at a competitive disadvantage against companies with broader product lines;
|
•
|
unforeseen costs associated with expanding our own sales and marketing team for new products or with entering into a partnering agreement with an independent sales and marketing organization; and
|
•
|
efforts by our competitors to commercialize competitive products.
|
•
|
continue the open label portion of DUET and conduct the planned Phase 3 trials of sparsentan indications;
|
•
|
continue the research and development of additional product candidates;
|
•
|
expand our sales and marketing infrastructure to commercialize our current products and any new products for which we may obtain regulatory approval; and
|
•
|
expand operational, financial, and management information systems and personnel, including personnel to support product development efforts and our obligations as a public company.
|
•
|
the progress and results of our pre-clinical and clinical studies of sparsentan for FSGS and Igan, Chenodal for CTX, and any other drug candidates;
|
•
|
the costs, timing and outcome of regulatory review of our product candidates;
|
•
|
debt service obligations on the 2025 Notes;
|
•
|
the number and development requirements of other product candidates that we pursue;
|
•
|
the costs of commercialization activities, including product marketing, sales and distribution;
|
•
|
the emergence of competing technologies and other adverse market developments;
|
•
|
the costs of preparing, filing and prosecuting patent applications and maintaining, enforcing and defending intellectual property related claims;
|
•
|
the extent to which we acquire or invest in businesses, products and technologies; and
|
•
|
our ability to establish collaborations and obtain milestone, royalty or other payments from any such collaborators.
|
•
|
results of clinical trials of our product candidates or those of our competitors;
|
•
|
our entry into or the loss of a significant collaboration;
|
•
|
regulatory or legal developments in the United States and other countries, including changes in the health care payment systems;
|
•
|
our ability to obtain and maintain marketing approvals from the FDA or similar regulatory authorities outside the United States;
|
•
|
variations in our financial results or those of companies that are perceived to be similar to us;
|
•
|
changes in the structure of healthcare payment systems;
|
•
|
market conditions in the pharmaceutical and biotechnology sectors and issuance of new or changed securities analysts’ reports or recommendations;
|
•
|
general economic, industry and market conditions;
|
•
|
results of clinical trials conducted by others on drugs that would compete with our product candidates;
|
•
|
developments or disputes concerning patents or other proprietary rights;
|
•
|
public concern over our product candidates or any products approved in the future;
|
•
|
litigation;
|
•
|
communications from government officials regarding health care costs or pharmaceutical pricing;
|
•
|
future sales or anticipated sales of our common stock by us or our stockholders; and
|
•
|
the other factors described in this “Risk Factors” section.
|
•
|
integrating personnel, operations and systems, while maintaining focus on producing and delivering consistent, high quality products;
|
•
|
coordinating geographically dispersed organizations;
|
•
|
distracting employees from operations;
|
•
|
retaining existing customers and attracting new customers; and
|
•
|
managing inefficiencies associated with integrating the operations of the Company.
|
•
|
decreased demand for any product candidates or products that we may develop;
|
•
|
damage to our reputation;
|
•
|
regulatory investigations that could require costly recalls or product modifications;
|
•
|
withdrawal of clinical trial participants;
|
•
|
costs to defend the related litigation;
|
•
|
substantial monetary awards to trial participants or patients, including awards that substantially exceed our product liability insurance, which we would then be required to pay from other sources, if available, and would damage our ability to obtain liability insurance at reasonable costs, or at all, in the future;
|
•
|
loss of revenue;
|
•
|
the diversion of management’s attention from managing our business; and
|
•
|
the inability to commercialize any products that we may develop.
|
•
|
our failure to demonstrate to the satisfaction of the FDA or comparable regulatory authorities that a product candidate is safe and effective for a particular indication;
|
•
|
the results of clinical trials may not meet the level of statistical significance required by the FDA or comparable regulatory authorities for approval;
|
•
|
our inability to demonstrate that a product candidate’s benefits outweigh its risks;
|
•
|
our inability to demonstrate that the product candidate presents an advantage over existing therapies;
|
•
|
the FDA’s or comparable regulatory authorities’ disagreement with the manner in which we interpret the data from preclinical studies or clinical trials;
|
•
|
failure of the third-party manufacturers with which we contract for clinical or commercial supplies to satisfactorily complete an FDA pre-approval inspection of the facility or facilities at which the product is manufactured to assess compliance with the FDA’s cGMP regulations to assure that the facilities, methods and controls are adequate to preserve the drug’s identity, strength, quality and purity; and
|
•
|
a change in the approval policies or regulations of the FDA or comparable regulatory authorities or a change in the laws governing the approval process.
|
•
|
make it more difficult for us to satisfy our obligations with respect to any other debt we may incur in the future;
|
•
|
increase our vulnerability to general adverse economic and industry conditions;
|
•
|
require us to dedicate a substantial portion of our cash flow from operations to payments on our indebtedness and related interest, thereby reducing the availability of our cash flow to fund working capital, capital expenditures and other general corporate purposes;
|
•
|
limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate;
|
•
|
increase our cost of borrowing;
|
•
|
place us at a competitive disadvantage compared to our competitors that may have less debt; and
|
•
|
limit our ability to obtain additional financing for working capital, capital expenditures, acquisitions, debt service requirements or general corporate purposes.
|
•
|
failure to pay (for more than 30 days) interest when due;
|
•
|
failure to pay principal when due;
|
•
|
failure to deliver shares of common stock upon conversion of a 2025 Notes;
|
•
|
failure to provide notice of a fundamental change;
|
•
|
acceleration on our other indebtedness in excess of $10 million (other than indebtedness that is non-recourse to us); or
|
•
|
certain types of bankruptcy or insolvency involving us.
|
3.1
|
|
3.2
|
|
3.3
|
|
4.1
|
|
4.2
|
|
4.3
|
|
4.4
|
|
4.5
|
|
10.1
|
|
10.2
|
|
10.3
|
|
31.1
|
|
31.2
|
|
32.1
|
|
32.2
|
|
101.INS
|
Inline XBRL Instance Document
|
101.SCH
|
Inline XBRL Taxonomy Extension Schema Document
|
101.CAL
|
Inline XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF
|
Inline XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB
|
Inline XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE
|
Taxonomy Extension Presentation Linkbase Document
|
104
|
The cover page to this Quarterly Report on Form 10-Q has been formatted in Inline XBRL
|
Date: May 11, 2020
|
RETROPHIN, INC.
|
||
|
|
|
|
|
By:
|
/s/ Eric M. Dube
|
|
|
|
Name:
|
Eric M. Dube
|
|
|
Title:
|
Chief Executive Officer
|
|
|
|
|
|
By:
|
/s/ Laura Clague
|
|
|
|
Name:
|
Laura Clague
|
|
|
Title:
|
Chief Financial Officer
|
1.
|
Annual Board Service Retainer:
|
|
a.
|
All Eligible Directors: $50,000
|
|
b.
|
Chairman of the Board Service Retainer (in addition to Eligible Director Service Retainer): $30,000
|
•
|
Audit Committee: an additional annual cash retainer of $10,000 for service as a member of the Audit Committee ($20,000 for service as the chairman of the Audit Committee)
|
•
|
Compensation Committee: an additional annual cash retainer of $7,500 for service as a member of the Compensation Committee ($15,000 for service as the chairman of the Compensation Committee)
|
•
|
Nominating/Corporate Governance Committee: $5,000 for service as a member of the Nominating / Corporate Governance Committee ($12,000 for service as the chairman of the Nominating / Corporate Governance committee)
|
•
|
Science and Medical Technology Committee: $5,000 for service as a member of the Science and Medical Technology Committee ($10,000 for service as the chairman of Science and Medical Technology Committee)
|
EXECUTIVE:
|
|
RETROPHIN, INC.:
|
||
|
|
|
|
|
By:
|
/s/ Peter Heerma
|
|
By:
|
/s/ Eric Dube
|
|
|
|
|
|
Date:
|
October 1, 2019
|
|
Date:
|
October 1, 2019
|
|
|
|
|
|
RETROPHIN, INC.:
|
|
EXECUTIVE:
|
||
|
|
|
|
|
By:
|
|
|
By:
|
|
|
|
|
|
|
Date:
|
|
|
Date:
|
|
|
|
|
|
|
•
|
All regular full-time executive officers of Retrophin are eligible to receive a bonus under this Plan (“Participant”).
|
•
|
Participants must be employed as a regular full-time employee by the Company prior to October 1 of the bonus plan year.
|
•
|
In order to be eligible to receive a bonus for a particular Bonus Plan Year (if any is earned), a Participant must be actively employed, and in good standing, as of the date the bonus checks are distributed for that year or as otherwise approved by the Board.
|
•
|
Temporary executive officers and consultants (regardless of their roles or responsibilities) are not eligible to participate.
|
•
|
Participation in the “Retrophin, Inc. Executive Officer Bonus Plan” is approved on an annual basis. Criteria for participation may be subject to change at the commencement of the Bonus Plan Year, and eligibility to participate in any Bonus Plan Year does not guarantee eligibility to participate in any subsequent Bonus Plan Year.
|
•
|
Participants whose individual performance is deemed to not be meeting expectations by the Compensation Committee are ineligible.
|
•
|
“Bonus Plan Year” means the twelve-month period beginning on each January 1 and ending on each December 31.
|
•
|
The “Board” means the Board of Directors of the Company.
|
•
|
The “Compensation Committee” means the Compensation Committee of the Board, as constituted from time to time.
|
•
|
The “Base Pay” is a Participant’s annual rate of base salary in effect as of December 31st of the applicable Bonus Plan Year.
|
•
|
The “Company Target Performance Measures” shall be determined at the sole discretion of the Compensation Committee or the Board and shall be set forth in writing, and may include, but shall not be limited to, a combination of financial, research and development and/or operational goals.
|
•
|
The “Company Modifier” is determined at the sole discretion of the Compensation Committee or the Board and is designed to reflect performance against Company results. For illustration purposes only, if the Company performance significantly exceeds the Company Target Performance Measures, the Company Modifier could exceed 100%, but in no case more than 150%. Similarly, if Company performance fails to meet the Company Target Performance Measures, the Company Modifier could be less than 100%. There is a minimum Corporate Performance required of 40% for any payment under the Plan to be considered. No Participant will have any entitlement to or earn a right to receive a bonus under this Plan until the date on which such bonus is paid. The Board and/or Compensation Committee reserve the right, at any time, regardless of corporate performance to approve or not approve the payment of a Bonus during any Plan Year.
|
•
|
The “Individual Modifier” is determined by the Participant’s relative performance during the Plan year, and will generally fall within 0%-125%, as per the Participant’s annual performance rating.
|
•
|
The “Target Bonus” means the percentage of Base Pay that would be awarded to a Participant upon the achievement of the Company Target Performance Measures at a level of 100%.
|
•
|
Participant’s Base Pay for the bonus year
|
◦
|
Number of credible eligible months of service for the Bonus Plan Year
|
•
|
Participant’s Individual Performance Modifier
|
•
|
Weighting of Company Performance Modifier based on level
|
•
|
Weighting of Individual Performance Modifier based on level
|
•
|
|
Position
|
Target Bonus %
|
Individual Modifier Weighting
|
Company Modifier Weighting
|
Chief Executive Officer
|
60%
|
N/A
|
100%
|
Other Executive Officers
|
50%
|
25%
|
75%
|
[(Participant’s base pay x Bonus Target percentage x individual performance modifier x individual performance weighting) x Plan year tenure]
|
+
|
[(Participant’s base pay x Bonus target percentage x company performance modifier x company performance weighting) x Plan year tenure]
|
•
|
Bonus awards, if earned, will be paid between January 1 and March 15 of the calendar year after the close of the applicable Bonus Plan Year.
|
•
|
In the event of a Participant’s leave of absence in excess of 30 days during the Bonus Plan Year, the bonus earned for that year will be prorated. The calculation will be based on the total number of whole or partial months actively at work divided by 12.
|
•
|
Executive officers hired after October 1 will not be eligible for a bonus award under this Plan until the following Bonus Plan Year.
|
•
|
Executive officers hired during the Bonus Plan Year on or before October 1 will be eligible to receive a prorated bonus based on the number of whole or partial months actively at work.
|
•
|
Bonus awards are based on the Participant’s target percentage and Base Salary as of December 31st of the Bonus Plan Year.
|
•
|
Retrophin reserves the right to modify or terminate the Plan at any time without prior notice.
|
•
|
The Plan does not modify a Participant’s at-will employment status or create a contract of employment for a specific term. Receipt of a bonus award is not guaranteed, and this Plan is not a promise of future or continued employment.
|
•
|
The Plan does not modify a Participant’s Employment Agreement.
|
•
|
The Company will withhold all required taxes and make any other required deductions from payments made under the Plan. This Plan is intended to provide “short term deferrals”, as described in Treasury Regulation 1.409A-1(b)(4) under section 409A of the Code or successor guidance thereto, and is intended not to be a “nonqualified deferred compensation plan”, as described in Treasury Regulation 1-409A-1(a)(1) under section 409A of the Code or successor guidance thereto. In the administration and interpretation of the Plan, such intention is to govern.
|
•
|
It is intended that this Plan be exempt from regulation under the Employee Retirement Income Security Act of 1974, as amended, as a “payroll practice” and a “bonus program”, as described in U.S. Department of Labor Regulations 2510.3-1(b) and 2510.3-2(c), respectively.
|
•
|
Any bonuses paid under the Bonus Plan shall be subject to the provisions of any claw-back policy implemented by the Company, including, without limitation, any claw-back policy adopted to comply with the requirements of the Dodd-Frank Wall Street Reform and Consumer Protection Act and any rules, regulations or interpretations thereunder.
|
•
|
This Plan shall be subject to and construed in accordance with the laws of the State of California without regard to conflicts of laws.
|
•
|
The Compensation Committee possesses sole discretion and authority to construe and interpret the terms and provisions of the Plan and to resolve any issue arising out of, relating to, or resulting from its administration and operation. Any disagreement or dispute by any person claiming a benefit under the Plan regarding any aspect of the Plan or its administration must be promptly presented in writing to the Compensation Committee for determination. Payments shall be made under the Plan only if the Compensation Committee determines in its sole discretion that the claimant is entitled to them. Any determinations the Compensation Committee makes in relation to the Plan will be final, conclusive, and binding on all persons, entities and parties claiming any interest under the Plan and will be entitled to the maximum possible deference allowed by law.
|
•
|
Except as explicitly provided by law, this Plan is provided at the Company's sole discretion, and the Company reserves the power at any time and from time to time, to modify, amend or terminate (in whole or in part) any or all of the provisions of the Plan at any time, prospectively or retroactively, without prior notice or obligation. Any amendment to the Plan shall be adopted by formal action of the Board.
|
•
|
The Plan will be operated as an unfunded arrangement, and nothing in this document will be construed to require the Company to fund any awards or to establish a trust or purchase an insurance policy or other product for such purpose. The Company may make such arrangements as it desires to provide for the payment of bonuses under the Plan.
|
•
|
Any payments made pursuant to the Plan shall not be counted as compensation for purposes of any other employee benefit plan, program or agreement sponsored, maintained or contributed to by the Company unless expressly provided for in such employee benefit plan, program, agreement, or arrangement.
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Retrophin, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
|
|
|
Date: May 11, 2020
|
|
|
|
|
|
|
|
|
|
|
/s/ Eric M. Dube
|
|
|
|
Eric M. Dube
|
|
|
|
Chief Executive Officer
|
|
|
|
(Principal Executive Officer)
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of Retrophin, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
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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
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5.
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The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
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(a)
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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
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(b)
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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.
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Date: May 11, 2020
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/s/ Laura Clague
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Laura Clague
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Chief Financial Officer
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(Principle Financial Officer)
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Date: May 11, 2020
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/s/ Eric M. Dube
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Eric M. Dube
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Chief Executive Officer
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(Principal Executive Officer)
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Date: May 11, 2020
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/s/ Laura Clague
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Laura Clague
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Chief Financial Officer
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(Principal Financial Officer)
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