HALO Halozyme Therapeutics Incorporated

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Halozyme Therapeutics, Inc. is a biopharma technology platform company that provides innovative and disruptive solutions with the goal of improving the patient experience and potentially outcomes.

Our proprietary enzyme, rHuPH20, is used to facilitate the subcutaneous (“SC”) delivery of injected drugs and fluids. We license our technology to biopharmaceutical companies to collaboratively develop products that combine our ENHANZE® drug delivery technology (“ENHANZE”) with the partners’ proprietary compounds. We also develop, manufacture and commercialize, for ourselves or with our partners, drug-device combination products using our advanced auto-injector technologies.

Our ENHANZE partners’ approved products and product candidates are based on rHuPH20, our patented recombinant human hyaluronidase enzyme. rHuPH20 works by breaking down hyaluronan (“HA”), a naturally occurring carbohydrate that is a major component of the extracellular matrix of the SC space. This temporarily reduces the barrier to bulk fluid flow allowing for improved and more rapid SC delivery of high dose, high volume injectable biologics, such as monoclonal antibodies and other large therapeutic molecules, as well as small molecules and fluids. We refer to the application of rHuPH20 to facilitate the delivery of other drugs or fluids as ENHANZE. We license the ENHANZE technology to form collaborations with biopharmaceutical companies that develop or market drugs requiring or benefiting from injection via the SC route of administration. In the development of proprietary intravenous (“IV”) drugs combined with our ENHANZE technology, data has been generated supporting the potential for ENHANZE to reduce patient treatment burden, as a result of shorter duration of SC administration with ENHANZE compared to IV administration. ENHANZE may enable fixed-dose SC dosing compared to weight-based dosing typically required for IV administration, extend the dosing interval for drugs that are already administered subcutaneously and potentially allow for lower rates of infusion related reactions. ENHANZE may enable more flexible treatment options such as home administration by a healthcare professional or potentially the patient or caregiver. Lastly, certain proprietary drugs co-formulated with ENHANZE have been granted additional exclusivity, extending the patent life of the product beyond the patent expiry of the proprietary IV drug.

We currently have ENHANZE collaborations and licensing agreements with F. Hoffmann-La Roche, Ltd. and Hoffmann-La Roche, Inc. (“Roche”), Takeda Pharmaceuticals International AG and Baxalta US Inc. (“Takeda”), Pfizer Inc. (“Pfizer”), Janssen Biotech, Inc. (“Janssen”), AbbVie, Inc. (“AbbVie”), Eli Lilly and Company (“Lilly”), Bristol-Myers Squibb Company (“BMS”), Alexion Pharma International Operations Unlimited Company (an indirect wholly owned subsidiary of AstraZeneca PLC) (“Alexion”), argenx BVBA (“argenx”), Horizon Therapeutics plc. (a wholly owned subsidiary of Amgen Inc.) (“Horizon”), ViiV Healthcare (the global specialist HIV Company majority owned by GlaxoSmithKline) (“ViiV”), Chugai Pharmaceutical Co., Ltd (“Chugai”) and Acumen Pharmaceuticals, Inc. (“Acumen”). In addition to receiving upfront licensing fees from our ENHANZE collaborations, we are entitled to receive event and sales-based milestone payments, revenues from the sale of bulk rHuPH20 and royalties from commercial sales of approved partner products co-formulated with ENHANZE. We currently earn royalties from four of these collaborations, including royalties from sales of one product from the Takeda collaboration, four products from the Roche collaboration, one product from the Janssen collaboration and one product from the argenx collaboration.

We have commercialized auto-injector products with several pharmaceutical companies including Teva Pharmaceutical Industries, Ltd. (“Teva”) and Otter Pharmaceuticals, LLC (“Otter”). We have development programs including auto-injectors with Idorsia Pharmaceuticals Ltd. (“Idorsia”).

Our commercial portfolio of proprietary products includes Hylenex®, utilizing rHuPH20, and our specialty products XYOSTED®, utilizing our auto-injector technology, and TLANDO®, an oral formulation of testosterone..

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Basis of Presentation

The accompanying interim unaudited condensed consolidated financial statements have been prepared for purposes of and in accordance with United States generally accepted accounting principles (“U.S. GAAP”) and with the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) related to a quarterly report on Form 10-Q. Accordingly, they do not include all of the information and disclosures required by U.S. GAAP for a complete set of financial statements. These interim unaudited condensed consolidated financial statements and notes thereto should be read in conjunction with the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on February 21, 2023. The unaudited financial information for the interim periods presented herein reflects all adjustments which, in the opinion of management, are necessary for a fair presentation of the financial condition and results of operations for the periods presented, with such adjustments consisting only of normal recurring adjustments. Operating results for interim periods are not necessarily indicative of the operating results for an entire fiscal year.

The accompanying interim unaudited condensed consolidated financial statements include the accounts of Halozyme Therapeutics, Inc. and our wholly owned subsidiaries, Halozyme, Inc. and Antares Pharma, Inc., and Antares Pharma, Inc.’s wholly owned Swiss subsidiaries, Antares Pharma IPL AG and Antares Pharma AG. All intercompany accounts and transactions have been eliminated.

Use of Estimates

The preparation of interim unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires us to make estimates and assumptions that affect the amounts reported in our interim unaudited condensed consolidated financial statements and accompanying notes. On an ongoing basis, we evaluate our estimates and judgments, which are based on historical and anticipated results and trends and on various other assumptions that we believe to be reasonable under the circumstances. By their nature, estimates are subject to an inherent degree of uncertainty and, as such, actual results may differ from our estimates.

Cash Equivalents and Marketable Securities

Cash equivalents consist of highly liquid investments, readily convertible to cash, that mature within 90 days or less from the date of purchase. As of September 30, 2023, our cash and cash equivalents consisted of money market funds, bank certificate of deposits, U.S. treasury securities and demand deposits at commercial banks.

Marketable securities are investments with original maturities of more than 90 days from the date of purchase that are specifically identified to fund current operations. Marketable securities are considered available-for-sale. These investments are classified as current assets, even though the stated maturity date may be one year or more beyond the current balance sheet date which reflects management’s intention to use the proceeds from the sale of these investments to fund our operations, as necessary. Such available-for-sale investments are carried at fair value with unrealized gains and losses recorded in other comprehensive income (loss) and included as a separate component of stockholders’ equity. The cost of marketable securities is adjusted for amortization of premiums or accretion of discounts to maturity, and such amortization or accretion is included in investment and other income, net in our condensed consolidated statements of income. We use the specific identification method for calculating realized gains and losses on marketable securities sold. None of the realized gains and losses and declines in value that were judged to be as a result of credit loss on marketable securities, if any, are included in investment and other income, net in our condensed consolidated statements of income.

Restricted Cash

Under the lease terms of our facilities, we may be required to maintain letters of credit as security deposits during the terms of such leases. As of September 30, 2023, no restricted cash remained pledged as collateral for the letters of credit as the associated lease was terminated. As of December 31, 2022, restricted cash of $0.5 million was pledged as collateral for the letters of credit.

Fair Value of Financial Instruments

The authoritative guidance for fair value measurements establishes a three tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include: Level 1, defined as observable inputs such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.

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Our financial instruments include cash equivalents, available-for-sale marketable securities, accounts receivable, prepaid expenses and other assets, accounts payable, accrued expenses and long-term debt. Fair value estimates of these instruments are made at a specific point in time based on relevant market information. These estimates may be subjective in nature and involve uncertainties and matters of significant judgment and therefore, cannot be determined with precision. The carrying amount of cash equivalents, accounts receivable, prepaid expenses and other assets, accounts payable and accrued expenses are generally considered to be representative of their respective fair values because of the short-term nature of those instruments.

Available-for-sale marketable securities consist of asset-backed securities, corporate debt securities, U.S. Treasury securities, agency bonds and commercial paper, and are measured at fair value using Level 1 and Level 2 inputs. Level 2 financial instruments are valued using market prices on less active markets and proprietary pricing valuation models with observable inputs, including interest rates, yield curves, maturity dates, issue dates, settlement dates, reported trades, broker-dealer quotes, issue spreads, benchmark securities or other market related data. We obtain the fair value of Level 2 investments from our investment manager, who obtains these fair values from a third-party pricing source. We validate the fair values of Level 2 financial instruments provided by our investment manager by comparing these fair values to a third-party pricing source.

Inventories

Inventories are stated at lower of cost or net realizable value. Cost is determined on a first-in, first-out basis. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. Inventories are reviewed periodically for potential excess, dated or obsolete status. We evaluate the carrying value of inventories on a regular basis, taking into account such factors as historical and anticipated future sales compared to quantities on hand, the price we expect to obtain for products in their respective markets compared with historical cost and the remaining shelf life of goods on hand.

Leases

We have entered into operating leases primarily for real estate and automobiles. These leases have contractual terms which range from three years to 12 years. We determine if an arrangement contains a lease at inception. Right of use (“ROU”) assets and liabilities resulting from operating leases are included in property and equipment, accrued expenses and other long-term liabilities on our condensed consolidated balance sheets. Operating lease ROU assets and liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the discount rate to calculate the present value of future payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. Our leases often include options to extend or terminate the lease. These options are included in the lease term when it is reasonably certain that we will exercise that option. Short-term leases with an initial term of 12 months or less are not recorded on our condensed consolidated balance sheets. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term.

We have lease agreements with lease and non-lease components, which are generally accounted for separately. For certain equipment leases, such as automobiles, we account for the lease and non-lease components as a single lease component.

Convertible Notes

The 2024 Convertible Notes, the 2027 Convertible Notes and the 2028 Convertible Notes (collectively, the “Convertible Notes”) are accounted for in accordance with authoritative guidance for debt and derivatives. We evaluate all the embedded conversion options contained in the Convertible Notes to determine if there are embedded features that require bifurcation as a derivative as required by U.S. GAAP. Based on our analysis, we account for each of our Convertible Notes as single units of accounting, a liability, because we concluded that the conversion features do not require bifurcation as a derivative under embedded derivative authoritative guidance.

Cash Flow Hedges - Currency Risks

Beginning in the second quarter of 2023, we entered into a cash flow hedging program to mitigate foreign currency exchange risk associated with forecasted royalty revenue denominated in Swiss francs. Under the program, we can hedge these forecasted royalties up to a maximum of four years into the future. We hedge these cash flow exposures to reduce the risk of our earnings and cash flows being adversely affected by fluctuations in exchange rates.

In accordance with the hedge accounting treatment, all hedging relationships are formally documented at the inception of the hedge and are highly effective in offsetting changes to future cash flows on hedged transactions. Both at inception of the hedge and on an ongoing basis, we assess whether the foreign currency forward contracts are highly effective in offsetting changes in cash flows of hedged items on a prospective and retrospective basis. If we determine a (i) foreign currency forward contract is not highly effective as a cash flow hedge, (ii) foreign currency forward contract has ceased to be a highly effective hedge or (iii) forecasted transaction is no longer probable of occurring, we would discontinue hedge accounting treatment

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prospectively. We measure effectiveness based on the change in fair value of the forward currency forward contract and the fair value of the hypothetical foreign currency forward contract with terms that match the critical terms of the risk being hedged. No portion of our foreign currency forward contracts were excluded from the assessment of hedge effectiveness. As of September 30, 2023, all hedges were determined to be highly effective.

The assets or liabilities associated with our hedging contracts are recorded at fair market value in prepaid expense and other current assets, accrued expenses, or other long-term liabilities, respectively, in our condensed consolidated balance sheets. Gains and losses related to changes in the fair market value of these hedging contracts are recorded as a component of accumulated other comprehensive income (loss) (“AOCI”) within stockholder’s equity in our condensed consolidated balance sheets and reclassified to royalty revenue in our condensed consolidated statements of income in the same period as the recognition of the underlying hedged transaction. In the event the underlying forecasted transaction does not occur, or it becomes probable that it will not occur, within the defined hedge period, we reclassify the gains or losses on the related cash flow hedge from AOCI to royalties revenue in our condensed consolidated statements of income. Since the fair market value of these hedging contracts is derived from current market rates, the hedging contracts are classified as derivative financial instruments. We do not use derivatives for speculative or trading purposes. As of September 30, 2023, amounts expected to be recognized as a net gain out of AOCI into our condensed consolidated statements of income during the next 12 months, are not material.

Business Combinations

Under the acquisition method of accounting, we allocate the fair value of the total consideration transferred to the tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values on the date of acquisition. These valuations require us to make estimates and assumptions, especially with respect to intangible assets. We record the excess consideration over the aggregate fair value of tangible and intangible assets, net of liabilities assumed, as goodwill. Costs incurred to complete a business combination, such as legal and other professional fees, are expensed as incurred.

If the initial accounting for a business combination is incomplete by the end of a reporting period that falls within the measurement period, we report provisional amounts in our financial statements. During the measurement period, we adjust the provisional amounts recognized at the acquisition date to reflect new information obtained about facts and circumstances that existed as of the acquisition date that, if known, would have affected the measurement of the amounts recognized as of that date. We record these adjustments to the provisional amounts with a corresponding offset to goodwill. Any adjustments identified after the measurement period are recorded in our condensed consolidated statements of income.

Goodwill, Intangible Assets and Other Long-Lived Asset

Assets acquired, including intangible assets and in-process research and development (“IPR&D”), and liabilities assumed are measured at fair value as of the acquisition date. Goodwill, which has an indefinite useful life, represents the excess of cost over fair value of the net assets acquired. Intangible assets acquired in a business combination that are used for IPR&D activities are considered indefinite lived until the completion or abandonment of the associated research and development efforts. Upon reaching the end of the relevant research and development project (i.e., upon commercialization), the IPR&D asset is amortized over its estimated useful life. If the relevant research and development project is abandoned, the IPR&D asset is expensed in the period of abandonment.

Goodwill and IPR&D are not amortized; however, they are reviewed for impairment at least annually during the second quarter, or more frequently if an event occurs indicating the potential for impairment. Goodwill and IPR&D are considered to be impaired if the carrying value of the reporting unit or IPR&D asset exceeds its respective fair value.

We perform our goodwill impairment analysis at the reporting unit level, which aligns with our reporting and operating segment structure and availability of discrete financial information. During the goodwill impairment review, we assess qualitative factors to determine whether it is more likely than not that the fair values of our reporting unit is less than the carrying amount, including goodwill. The qualitative factors include, but are not limited to, macroeconomic conditions, industry and market considerations, and our overall financial performance. If, after assessing the totality of these qualitative factors, we determine that it is not more likely than not that the fair value of our reporting unit is less than the carrying amounts, then no additional assessment is deemed necessary. Otherwise, we proceed to compare the estimated fair value of the reporting unit with the carrying value, including goodwill. If the carrying amount of the reporting unit exceeds the fair value, we record an impairment loss based on the difference. We may elect to bypass the qualitative assessment in a period and proceed to perform the quantitative goodwill impairment test.

Our identifiable intangible assets with finite useful lives are typically comprised of acquired device technologies and product rights. The cost of identifiable intangible assets with finite lives is generally amortized on a straight-line basis over the assets’ respective estimated useful lives.

We perform regular reviews to determine if any event has occurred that may indicate intangible assets with finite useful lives and other long-lived assets are potentially impaired. If indicators of impairment exist, an impairment test is performed to

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assess the recoverability of the affected assets by determining whether the carrying amount of such assets exceeds the undiscounted expected future cash flows. If the affected assets are not recoverable, we estimate the fair value of the assets and record an impairment loss if the carrying value of the assets exceeds the fair value. Factors that may indicate potential impairment include a significant decline in our stock price and market capitalization compared to the net book value, significant changes in the ability of a particular asset to generate positive cash flows for our strategic business objectives, and the pattern of utilization of a particular asset.

Revenue Recognition

We generate revenues from payments received (i) as royalties from licensing our ENHANZE technology and other royalty arrangements, (ii) under collaborative agreements and (iii) from sales of our proprietary and partnered products. We recognize revenue when we transfer promised goods or services to customers in an amount that reflects the consideration to which we expect to be entitled in exchange for those goods or services. To determine revenue recognition for contracts with customers, we perform the following five steps: (i) identify the promised goods or services in the contract; (ii) identify the performance obligations in the contract, including whether they are distinct in the context of the contract; (iii) determine the transaction price, including the constraint on variable consideration; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) we satisfy the performance obligations.

ENHANZE and Device Royalties

Under the terms of our ENHANZE collaboration and license agreements, our partners will pay us royalties at an on average mid-single digit percent rate of their sales if products under the collaboration are commercialized. All amounts owed to us are noncancelable after the underlying triggering event occurs, and nonrefundable once paid. Unless terminated earlier in accordance with its terms, collaborations generally continue in effect until the last to expire royalty payment term, as determined on a product by product and country by country basis, with each royalty term starting on the first commercial sale of that product and ending the later of: (i) a specified period or term set forth in the agreement or (ii) expiration of the last to expire of the valid claims of our patents covering rHuPH20 or other specified patents developed under the collaboration which valid claim covers a product developed under the collaboration. In general, when there are no valid claims of a specified patent developed under the collaboration covering the product in a given country, the royalty rate is reduced for those sales in that country upon the expiration of our patents covering rHuPH20. Janssen’s patents covering DARZALEX SC do not impact the timing for this royalty reduction. Partners may terminate the agreement prior to expiration for any reason in its entirety or on a target-by-target basis generally upon 90 days prior written notice to us. Upon any such termination, the license granted to partners (in total or with respect to the terminated target, as applicable) will terminate provided; however, that in the event of expiration of the agreement (as opposed to a termination), the on-going licenses granted will become perpetual, non-exclusive and fully paid. Sales-based milestones and royalties are recognized in the period the underlying sales or milestones occur. We do not receive final royalty reports from our ENHANZE partners until after we complete our financial statements for a prior quarter. Therefore, we recognize revenue based on estimates of the royalty earned, which are based on internal estimates and available preliminary reports provided by our partners. We will record adjustments in the following quarter, if necessary, when final royalty reports are received. To date, we have not recorded any material adjustments.

We also earn royalties in connection with several of our licenses granted under license and development arrangements with our device partners. These royalties are based upon a percentage of commercial sales of partnered products with rates ranging from mid-single digits to low double digits and are tiered based on levels of net sales. These sales-based royalties, for which the license was deemed the predominant element to which the royalties relate, are estimated and recognized in the period in which the partners’ commercial sales occur. The royalties are generally reported and payable to us within 45 to 60 days after the end of the period in which the commercial sales are made. We base our estimates of royalties earned on actual sales information from our partners when available or estimated, prescription sales from external sources and estimated net selling price. We will record adjustments in the following quarter, if necessary, when final royalty reports are received. To date, we have not recorded any material adjustments.

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Revenue under ENHANZE and Device Collaborative Agreements

ENHANZE Collaboration and License Agreements

Under these agreements, we grant the collaboration partner a worldwide license to develop and commercialize products using our ENHANZE technology to combine our patented rHuPH20 enzyme with their proprietary biologics directed at up to a specified number of targets. Targets are usually licensed on an exclusive, global basis. Targets selected subsequent to inception of the arrangement generally require payment of an additional license fee. The collaboration partner is responsible for all development, manufacturing, clinical, regulatory, sales and marketing costs for any products developed under the agreement. We are responsible for supply of bulk rHuPH20 based on the collaboration partner’s purchase orders, and may also be separately engaged to perform research and development services. While these collaboration agreements are similar in that they originate from the same framework, each one is the result of an arms-length negotiation and thus may vary from one to the other.

We generally collect an upfront license payment from collaboration partners, and are also entitled to receive event-based payments subject to collaboration partners’ achievement of specified development, regulatory and sales-based milestones. In several agreements, collaboration partners pay us annual fees to maintain their exclusive license rights if they are unable to advance product development to specified stages. We earn separate fees for bulk rHuPH20 supplies and research and development services.

Although these agreements are in form identified as collaborative agreements, we concluded for accounting purposes they represent contracts with customers and are not subject to accounting literature on collaborative arrangements. This is because we grant to partners licenses to our intellectual property and provide supply of bulk rHuPH20 and research and development services which are all outputs of our ongoing activities, in exchange for respective consideration. Under these collaborative agreements, our partners lead development of assets, and we do not share in significant financial risks of their development or commercialization activities. Accordingly, we concluded our collaborative agreements are appropriately accounted for pursuant to U.S. GAAP.

Under all of our ENHANZE collaborative agreements, we have identified licenses to use functional intellectual property as the only performance obligation. The intellectual property underlying the license is our proprietary ENHANZE technology which represents application of rHuPH20 to facilitate delivery of drugs. Each of the licenses grants the partners rights to use our intellectual property as it exists and is identified on the effective date of the license, because there is no ongoing development of the ENHANZE technology required. Therefore, we recognize revenue from licenses at the point when the license becomes effective and the partner has received access to our intellectual property, usually at the inception of the agreement.

When partners can select additional targets to add to the licenses granted, we consider these rights to be options. We evaluate whether such options contain material rights, i.e. have exercise prices that are discounted compared to what we would charge for a similar license to a new partner. The exercise price of these options includes a combination of the target selection fees, event-based milestone payments and royalties. When these amounts in aggregate are not offered at a discount that exceeds discounts available to other customers, we conclude the option does not contain a material right, and we consider grants of additional licensing rights upon option exercises to be separate contracts (target selection contracts).

Generally, we provide indemnification and protection of licensed intellectual property for our customers. These provisions are part of assurance that the licenses meet the agreements’ representations and are not obligations to provide goods or services.

We also fulfill purchase orders for supply of bulk rHuPH20 and perform research and development services pursuant to projects authorization forms for our partners, which represent separate contracts. In addition to our licenses, we price our supply of bulk rHuPH20 and research and development services at our regular selling prices, called standalone selling prices (“SSP”). Therefore, our partners do not have material rights to order these items at prices not reflective of SSP. Refer to the discussion below regarding recognition of revenue for these separate contracts.

Transaction price for a contract represents the amount to which we are entitled in exchange for providing goods and services to the customer. Transaction price does not include amounts subject to uncertainties unless it is probable that there will be no significant reversal of revenue when the uncertainty is resolved. Apart from the upfront license payment (or target selection fees in the target selection contracts), all other fees we may earn under our collaborative agreements are subject to significant uncertainties of product development. Achievement of many of the event-based development and regulatory milestones may not be probable until such milestones are actually achieved. This generally relates to milestones such as obtaining marketing authorization approvals. With respect to other development milestones, e.g., dosing of a first patient in a clinical trial, achievement could be considered probable prior to its actual occurrence, based on the progress towards commencement of the trial. In order to evaluate progress towards commencement of a trial, we assess the status of activities leading up to our partner’s initiation of a trial such as feedback received from the applicable regulatory authorities, completion of Investigational New Drug (“IND”) or equivalent filings, readiness and availability of drug, readiness of study sites and our partner’s commitment of resources to the program. We do not include any amounts subject to uncertainties in the transaction

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price until it is probable that the amount will not result in a significant reversal of revenue in the future. At the end of each reporting period, we re-evaluate the probability of achievement of such milestones and any related constraint, and if necessary, adjust our estimate of the overall transaction price.

When target exchange rights are held by partners, and the amounts attributed to these rights are not refundable, they are included in the transaction price. However, they are recorded as deferred revenues because we have a potential performance obligation to provide a new target upon an exchange right being exercised. These amounts are recognized in revenue when the right of exchange expires or is exercised.

Because our agreements have one type of performance obligation (licenses) which are typically all transferred at the same time at agreement inception, allocation of transaction price often is not required. However, allocation is required when licenses for some of the individual targets are subject to rights of exchange, because revenue associated with these targets cannot be recognized. When allocation is needed, we perform an allocation of the upfront amount based on relative SSP of licenses for individual targets. We determine license SSP using an income-based valuation approach utilizing risk-adjusted discounted cash flow projections of the estimated return a licensor would receive. When amounts subject to uncertainties, such as milestones and royalties, are included in the transaction price, we attribute them to the specific individual target licenses which generate such milestone or royalty amounts.

We also estimate SSP of bulk rHuPH20 and research and development services, to determine that our partners do not have material rights to order them at discounted prices. For supplies of bulk rHuPH20, because we effectively act as a contract manufacturer to our partners, we estimate and charge SSP based on the typical contract manufacturer margins consistent with all of our partners. We determine SSP of research and development services based on a fully-burdened labor rate. Our rates are comparable to those we observe in other collaborative agreements. We also have a history of charging similar rates to all of our partners.

Upfront amounts allocated to licenses to individual targets are recognized as revenue when the license is transferred to the partner, as discussed above, if the license is not subject to exchange rights, or when the exchange right expires or is exercised. Development milestones and other fees are recognized in revenue when they are included in the transaction price, because by that time, we have already transferred the related license to the partner.

In contracts to provide research and development services, such services represent the only performance obligation. The fees are charged based on hours worked by our employees and the fixed contractual rate per hour, plus third-party pass-through costs, on a monthly basis. We recognize revenues as the related services are performed based on the amounts billed, as the partner consumes the benefit of research and development work simultaneously as we perform these services, and the amounts billed reflect the value of these services to the customer.

Device License, Development and Supply Arrangements

We have several license, development and supply arrangements with pharmaceutical partners, under which we grant a license to our device technology and provide research and development services that often involve multiple performance obligations and highly-customized deliverables. For such arrangements, we identify each of the promised goods and services within the contract and the distinct performance obligations at inception of the contract and allocate consideration to each performance obligation based on relative SSP, which is generally determined based on the expected cost plus mark-up.

If the contract includes an enforceable right to payment for performance completed to date and performance obligations are satisfied over time, we recognize revenue over the development period using either the input or output method depending on which is most appropriate given the nature of the distinct deliverable. For other contracts that do not contain an enforceable right to payment for performance completed to date, revenue is recognized when control of the product is transferred to the customer. Factors that may indicate transfer of control has occurred include the transfer of legal title, transfer of physical possession, the customer has obtained the significant risks and rewards of ownership of the assets and we have a present right to payment.

Our typical payment terms for development contracts may include an upfront payment equal to a percentage of the total contract value with the remaining portion to be billed upon completion and transfer of the individual deliverables or satisfaction of the individual performance obligations. We record a contract liability for cash received in advance of performance, which is presented within deferred revenue and deferred revenue, long-term in our condensed consolidated balance sheets and recognized as revenue in our condensed consolidated statements of income when the associated performance obligations have been satisfied.

License fees and milestones received in exchange for the grant of a license to our functional intellectual property, such as patented technology and know-how in connection with a partnered development arrangement, are generally recognized at inception of the arrangement, or over the development period depending on the facts and circumstances, as the license is generally not distinct from the non-licensed goods or services to be provided under the contract. Milestone payments that are

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contingent upon the occurrence of future events are evaluated and recorded at the most likely amount, and to the extent that it is probable that a significant reversal of revenue will not occur when the associated uncertainty is resolved.

Refer to Note 5, Revenue, for further discussion on our collaborative arrangements.

Product Sales, Net

Proprietary Product Sales

Our commercial portfolio of proprietary products includes XYOSTED, TLANDO and Hylenex recombinant which we sell primarily to wholesale pharmaceutical distributors and specialty pharmacies, who sell the products to hospitals, retail chain drug stores and other end-user customers. Sales to wholesalers are made pursuant to purchase orders subject to the terms of a master agreement, and delivery of individual packages of products represents performance obligations under each purchase order. We use contract manufacturers to produce our proprietary products and third-party logistics (“3PL”) vendors to process and fulfill orders. We concluded we are the principal in the sales to wholesalers because we control access to services rendered by both vendors and direct their activities. We have no significant obligations to wholesalers to generate pull-through sales.

Revenue is recognized when control has transferred to the customer, which is typically upon delivery, at the net selling price, which reflects the variable consideration for which reserves and sales allowances are established for estimated returns, wholesale distribution fees, prompt payment discounts, government rebates and chargebacks, plan rebate arrangements and patient discount and support programs. We recognize revenue from product sales and related cost of sales upon product delivery to the wholesaler location. At that time, the wholesalers take control of the product as they take title, bear the risk of loss of ownership, and have an enforceable obligation to pay us. They also have the ability to direct sales of product to their customers on terms and at prices they negotiate. Although wholesalers have product return rights, we do not believe they have a significant incentive to return the product to us.

The determination of certain reserves and sales allowances requires us to make a number of judgements and estimates to reflect our best estimate of the transaction price and the amount of consideration to which we believe we would be ultimately entitled to receive. The expected value is determined based on unit sales data, contractual terms with customers and third-party payers, historical and estimated future percentage of rebates incurred on sales, historical and future insurance plan billings, any new or anticipated changes in programs or regulations that would impact the amount of the actual rebates, customer purchasing patterns, product expiration dates and levels of inventory in the distribution channel. The estimated amounts of credit for product returns, chargebacks, distribution fees, prompt payment discounts, rebates and customer co-pay support programs are included in accrued expenses and accounts receivable, net in our condensed consolidated balance sheets upon recognition of revenue from product sales. We monitor actual product returns, chargebacks, discounts and fees subsequent to the sale. If these amounts differ from our estimates, we make adjustments to these allowances, which are applied to increase or reduce product sales revenue and earnings in the period of adjustment.

Selling prices initially billed to wholesalers are subject to discounts for prompt payment and subsequent chargebacks when wholesalers sell our products at negotiated discounted prices to members of certain group purchasing organizations (“GPOs”), Pharmacy Benefit Managers (“PBMs”) and government programs. We also pay quarterly distribution fees to certain wholesalers for inventory reporting and chargeback processing, and to PBMs and GPOs as administrative fees for services and for access to their members. We concluded the benefits received in exchange for these fees are not distinct from our sales of our products, and accordingly we apply these amounts to reduce revenues. Wholesalers also have rights to return unsold product nearing or past the expiration date. Because of the shelf life of our products and our lengthy return period, there may be a significant period of time between when the product is shipped and when we issue credits on returned product.

We estimate the transaction price when we receive each purchase order taking into account the expected reductions of the selling price initially billed to the wholesaler arising from all of the above factors. We have compiled historical experience and data to estimate future returns and chargebacks of our products and the impact of the other discounts and fees we pay. When estimating these adjustments to the transaction price, we reduce it sufficiently to be able to assert that it is probable that there will be no significant reversal of revenue when the ultimate adjustment amounts are known.

Each purchase order contains only one type of product, and is usually shipped to the wholesaler in a single shipment. Therefore, allocation of the transaction price to individual packages is not required.

In connection with the orders placed by wholesalers, we incur costs such as commissions to our sales representatives. However, as revenue from product sales is recognized upon delivery to the wholesaler, which occurs shortly after we receive a purchase order, we do not capitalize these commissions and other costs, based on application of the practical expedient allowed within the applicable guidance.

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Partnered Product Sales

Bulk rHuPH20

We sell bulk rHuPH20 to partners for use in research and development and, subsequent to receiving marketing approval, we sell it for use in collaboration commercial products. Sales are made pursuant to purchase orders subject to the terms of the collaborative agreement or a supply agreement, and delivery of units of bulk rHuPH20 represent performance obligations under each purchase order. We provide a standard warranty that the product conforms to specifications. We use contract manufacturers to produce bulk rHuPH20 and have concluded we are the principal in the sales to partners. The transaction price for each purchase order of bulk rHuPH20 is fixed based on the cost of production plus a contractual markup, and is not subject to adjustments. Allocation of the transaction price to individual quantities of the product is usually not required because each order contains only one type of product.

We recognize revenue from the sale of bulk rHuPH20 as product sales and related cost of sales upon transfer of title to our partners. At that time, the partners take control of the product, bear the risk of loss of ownership, and have an enforceable obligation to pay us.

Devices

We are party to several license, development, supply and distribution arrangements with pharmaceutical partners, under which we produce and are the exclusive supplier of certain products, devices and/or components. Revenue is recognized when or as control of the goods transfers to the customer as discussed below.

We are the exclusive supplier of OTREXUP® to Otter. Because this product is custom manufactured with no alternative use and we have a contractual right to payment for performance completed to date, control is continuously transferred to the customer as the product is produced pursuant to firm purchase orders. Revenue is recognized over time using the output method based on the contractual selling price and number of units produced. The amount of revenue recognized in excess of the amount shipped/billed to the customer, if any, is recorded as contract assets in our condensed consolidated balance sheets due to the short-term nature in which the amount is ultimately expected to be billed and collected from the customer.

All other device partnered product sales are recognized at the point in time in which control is transferred to the customer, which is typically upon shipment. Sales terms and pricing are governed by the respective supply and distribution agreements, and there is generally no right of return. Revenue is recognized at the transaction price, which includes the contractual per unit selling price and estimated variable consideration, such as volume-based pricing arrangements or profit-sharing arrangements, if any. We recognize revenue, including the estimated variable consideration we expect to receive for contract margin on future commercial sales, upon shipment of the goods to our partner. The estimated variable consideration is recognized at an amount we believe is not subject to significant reversal of revenue based on historical experience and is adjusted at each reporting period if the most likely amount of expected consideration changes or becomes fixed.

Revenue Presentation

In our condensed consolidated statements of income, we report the upfront payments, event-based development and regulatory milestones and sales milestones as revenues under collaborative agreements. We also include in this category revenues from separate research and development contracts pursuant to project authorization forms. We report royalties received from partners as a separate line in our condensed consolidated statements of income.

Revenues from sales of our proprietary and partnered products are included in product sales, net in our condensed consolidated statements of income.

In the footnotes to our condensed consolidated financial statements, we provide disaggregated revenue information by type of arrangement (royalties; product sales, net; and collaborative agreements), and additionally, by type of payment stream received under collaborative agreements (upfront license and target nomination fees; event-based development and regulatory milestones and other fees; sales-based milestones; and device licensing and development revenue).

Cost of Sales

Cost of sales consists primarily of raw materials, third-party manufacturing costs, fill and finish costs, freight costs, internal costs and manufacturing overhead associated with the production of proprietary and partnered products. Cost of sales also consists of the write-down of excess, dated and obsolete inventories and the write-off of inventories that do not meet certain product specifications, if any.

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Research and Development Expenses

Research and development expenses include salaries and benefits, facilities and other overhead expenses, research related manufacturing services, contract services, and other outside expenses. Research and development expenses are charged to operating expenses as incurred when these expenditures relate to our research and development efforts and have no alternative future uses.

We are obligated to make upfront payments upon execution of certain research and development agreements. Advance payments, including nonrefundable amounts, for goods or services that will be used or rendered for future research and development activities are deferred. Such amounts are recognized as expense as the related goods are delivered or the related services are performed or such time when we do not expect the goods to be delivered or services to be performed.

Share-Based Compensation

We record compensation expense associated with stock options, restricted stock units (“RSUs”), performance stock units (“PSUs”) and shares issued under our employee stock purchase plan (“ESPP”) in accordance with the authoritative guidance for share-based compensation. The cost of employee services received in exchange for an award of an equity instrument is measured at the grant date, based on the estimated fair value of the award, and is recognized as expense on a straight-line basis over the requisite service period of the award. Share-based compensation expense for an award with a performance condition is recognized when the achievement of such performance condition is determined to be probable. If the outcome of such performance condition is not determined to be probable or is not met, no compensation expense is recognized and any previously recognized compensation expense is reversed. Forfeitures are recognized as a reduction of share-based compensation expense as they occur.

Income Taxes

We provide for income taxes using the liability method. Under this method, deferred income tax assets and liabilities are determined based on the differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases at each reporting period. We measure deferred tax assets and liabilities using enacted tax rates for the year in which the differences are expected to reverse. Significant judgment is required by management to determine our provision for income taxes, our deferred tax assets and liabilities, and any associated valuation allowances recorded against our net deferred tax assets, which are based on complex and evolving tax regulations. Deferred tax assets (“DTA”) and other tax benefits are recorded when they are more likely than not to be realized. On a quarterly basis, we assess the need for valuation allowance on our DTAs, weighing all positive and negative evidence, to assess if it is more-likely-than-not that some or all of our DTAs will be realized. We recorded a provision for income taxes of $19.9 million and $50.9 million using an effective tax rate of 19.9% and 20.6% for the three and nine months ended September 30, 2023, respectively. The difference between our effective tax rate and the U.S. federal statutory rate of 21% is primarily due to state income taxes, tax benefits on the Foreign Derived Intangible Income Deduction (“FDII”), tax detriments on 162(m) and other share-based compensation.

Segment Information

We operate our business in one operating segment, which includes all activities related to the research, development and commercialization of our proprietary enzymes and devices. This segment also includes revenues and expenses related to (i) research and development and manufacturing activities conducted under our collaborative agreements with third parties, and (ii) product sales of proprietary and partnered products. The chief operating decision-maker reviews the operating results on an aggregate basis and manages the operations as a single operating segment.

Adoption and Pending Adoption of Recent Accounting Pronouncements

There are no relevant recently issued accounting pronouncements that would materially impact our condensed consolidated financial statements and related disclosures.

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On May 24, 2022, we acquired all outstanding equity interests of Antares Pharma, Inc. (“Antares”) according to the terms and conditions of the Agreement and Plan of Merger, dated as of April 12, 2022 (the “Merger Agreement”). Antares is a specialty pharmaceutical company focused primarily on the development and commercialization of pharmaceutical products and technologies that address patient needs in targeted therapeutic areas. We acquired Antares as a part of our strategy to expand as a drug delivery company and include specialty products.

The total purchase consideration of Antares was $1,045.7 million. Each share of Antares common stock issued and outstanding was converted into the right to receive $5.60 in cash without interest, less any applicable withholding taxes (“Merger Consideration”).

The acquisition of Antares has been accounted for using the acquisition method of accounting in accordance with authoritative guidance for business combinations, with Halozyme treated as the accounting acquirer, which requires, among other things, that the assets acquired and liabilities assumed be recognized at their fair value on the acquisition date. The judgments used to determine the estimated fair value assigned to each class of assets acquired and liabilities assumed, as well as asset lives, can materially impact our results of operations.

In the first six months of 2023, we recorded measurement period adjustments which increased goodwill by $7.8 million to adjust accrued expenses by $2.0 million, deferred tax liabilities by $5.6 million and accounts receivable by $0.2 million. The measurement period adjustments have been recorded to reflect facts and circumstances that existed as of the acquisition date. During the second quarter of 2023, we finalized the estimates impacting the allocation of purchase price consideration.

Unaudited Pro Forma Results

Our prior year consolidated financial statements includes Antares’s operations from May 24, 2022 through September 30, 2022. Total revenues and net loss before taxes attributable to Antares and included in our condensed consolidated statements of income for the three months ended September 30, 2022 total $50.4 million and $35.5 million and $69.1 million and $75.3 million for the nine months ended September 30, 2022, respectively.

The following unaudited pro forma financial information summarizes combined results of operations of Halozyme and Antares as if the companies had been combined as of the beginning of our fiscal year 2021 (in thousands).

						Three Months Ended  September 30,												Nine Months Ended September 30,
						2023						2022						2023						2022
Total revenues						$	216,033					$	208,976					$	599,214					$	531,189
Net income						81,837						66,771						196,206						163,795

The unaudited pro forma financial information for all periods presented includes the business combination accounting effects resulting from this acquisition. The unaudited pro forma results include adjustments to reflect the amortization of the inventory step-up and the incremental intangible asset amortization to be incurred based on preliminary valuations of assets as well as certain material non-recurring transaction adjustments related to the acquisition. Adjustments to interest expense, financing costs and investment income were made to reflect the capital structure of the combined entity. Adjustments to income tax expense were also made to reflect the anticipated effective tax rate of the combined entity. The unaudited pro forma financial information as presented is for informational purposes only and is not necessarily indicative of the results of operations that would have been achieved if the acquisition had taken place at the beginning of fiscal year 2021, nor is it necessarily an indication of trends in future results for a number of reasons, including, but not limited to, differences between the assumptions used to prepare the pro forma information, cost savings from operating efficiencies, potential synergies, and the impact of incremental costs incurred in integrating the businesses.

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Available-for-sale marketable securities consisted of the following (in thousands):

						September 30, 2023
						Amortized Cost						Gross Unrealized Gains						Gross Unrealized Losses						Estimated Fair Value
Asset-backed securities						$	4,599					$	—					$	(20)					$	4,579
Corporate debt securities						5,976						—						(31)						5,945
U.S. treasury securities						160,034						—						(104)						159,930
Agency bonds						16,020						—						(73)						15,947
Commercial paper						22,655						—						(1)						22,654
Total marketable securities, available-for-sale						$	209,284					$	—					$	(229)					$	209,055

						December 31, 2022
						Amortized Cost						Gross Unrealized Gains						Gross Unrealized Losses						Estimated Fair Value
Asset-backed securities						$	1,146					$	—					$	—					$	1,146
Corporate debt securities						7,139						—						(9)						7,130
U.S. treasury securities						111,469						—						(934)						110,535
Agency bonds						2,783						2						(1)						2,784
Commercial paper						7,004						—						—						7,004
Total marketable securities, available-for-sale						$	129,541					$	2					$	(944)					$	128,599

As of September 30, 2023, 43 available-for-sale marketable securities with a fair market value of $196.8 million were in a gross unrealized loss position of $0.2 million. Based on our review of these marketable securities, we believe none of the unrealized loss is as a result of a credit loss as of September 30, 2023 because we do not intend to sell these securities and it is not more-likely-than-not that we will be required to sell these securities before the recovery of their amortized cost basis.

The estimated fair value of our contractual maturities of available-for-sale debt securities were as follows (in thousands):

						September 30, 2023						December 31, 2022
Due within one year						$	179,400					$	114,353
Due after one year but within five years						29,655						14,246
Total estimated fair value of contractual maturities, available-for-sale						$	209,055					$	128,599

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The following table summarizes, by major security type, our cash equivalents and available-for-sale marketable securities measured at fair value on a recurring basis and are categorized using the fair value hierarchy (in thousands):

						September 30, 2023																		December 31, 2022
						Level 1						Level 2						Total estimated fair value						Level 1						Level 2						Total estimated fair value
Assets
Cash equivalents
Money market funds						$	147,113					$	—					$	147,113					$	191,704					$	—					$	191,704
U.S. treasury securities						23,000						—						23,000						—						—						—
Available-for-sale marketable    securities
Asset-backed securities						—						4,579						4,579						—						1,146						1,146
Corporate debt securities						—						5,945						5,945						—						7,130						7,130
U.S. treasury securities						159,930						—						159,930						110,535						—						110,535
Agency bonds						15,947						—						15,947						2,784						—						2,784
Commercial paper						—						22,654						22,654						—						7,004						7,004
Derivative instruments
Currency hedging contracts (1)						—						2,163						2,163						—						—						—
Total assets						$	345,990					$	35,341					$	381,331					$	305,023					$	15,280					$	320,303
Liabilities
Derivative instruments
Currency hedging contracts (1)						$	—					$	347					347						$	—					$	—					—

(1) Based on observable market transactions of spot currency rates, forward currency rates or equivalently-termed instruments. Carrying amounts of the financial assets and liabilities are equal to the fair value. As of September 30, 2023, the derivative assets and liabilities recorded within prepaid expenses and other current assets, prepaid expense and other assets and other long-term liabilities were $1.6 million, $0.6 million and $0.3 million, respectively.

We had no available for sale securities that were classified within Level 3 as of September 30, 2023 and December 31, 2022.

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Our disaggregated revenues were as follows (in thousands):

						Three Months Ended  September 30,												Nine Months Ended September 30,
						2023						2022						2023						2022
Royalties						$	114,433					$	99,551					$	325,813					$	254,496
Product sales, net
Sales of bulk rHuPH20						37,001						19,259						86,203						60,764
Sale of proprietary products						31,511						24,180						91,765						44,559
Sale of device partnered products						18,057						17,988						43,284						24,544
Total product sales, net						$	86,569					$	61,427					$	221,252					$	129,867
Revenues under collaborative agreements
Upfront license and target nomination fees						—						—						—						30,000
Event-based development and regulatory milestone and other fees						13,000						44,000						46,000						59,000
Device licensing and development revenue						2,031						3,998						6,149						5,257
Total revenues under collaborative agreements						$	15,031					$	47,998					$	52,149					$	94,257
Total revenues						$	216,033					$	208,976					$	599,214					$	478,620

During the three months ended September 30, 2023, we recognized revenue related to licenses granted to partners in prior periods in the amount of $127.4 million. This amount represents royalties earned in the current period in addition to $13.0 million of variable consideration in the contracts where uncertainties were resolved and the development milestones are expected to be achieved or were achieved. We also recognized revenue of $0.1 million during the three months ended September 30, 2023 that had been included in deferred revenues in our condensed consolidated balance sheets as of December 31, 2022.

During the nine months ended September 30, 2023, we recognized revenue related to licenses granted to partners in prior periods in the amount of $371.8 million. This amount represents royalties earned in the current period in addition to $46.0 million of variable consideration in the contracts where uncertainties were resolved and the development milestones are expected to be achieved or were achieved. We also recognized revenue of $3.2 million during the nine months ended September 30, 2023 that had been included in deferred revenues in our condensed consolidated balance sheets as of December 31, 2022.

Accounts receivable, other contract assets and deferred revenues (contract liabilities) from contracts with customers, including partners, consisted of the following (in thousands):

						September 30, 2023						December 31, 2022
Accounts receivable, net						$	213,987					$	186,970
Other contract assets						3,338						44,102
Deferred revenues						2,920						5,499

As of September 30, 2023, the amounts included in the transaction price of our contracts with customers, including collaboration partners, and allocated to goods and services not yet provided were $86.1 million, of which $83.2 million relates to unfulfilled product purchase orders and $2.9 million has been collected and is reported as deferred revenues in our condensed consolidated balance sheets. The unfulfilled product purchase orders are estimated to be delivered by the end of 2024. Of the total deferred revenues of $2.9 million, $0.7 million is expected to be used by our customers within the next 12 months.

We recognized contract assets of $3.3 million as of September 30, 2023, which related to development milestones deemed probable of receipt for intellectual property licenses granted to partners in prior periods and for goods or services when control has transferred to the customer, and corresponding revenue is recognized on an over time basis but is not yet billable to the customer in accordance with the terms of the contract.

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Accounts receivable, net and contract assets consisted of the following (in thousands):

						September 30, 2023						December 31, 2022
Accounts receivable from product sales to partners						$	50,172					$	62,979
Accounts receivable from revenues under collaborative agreements						17,357						18,776
Accounts receivable from royalty payments						113,632						100,900
Accounts receivable from other product sales						38,758						6,229
Contract assets						3,338						44,102
Total accounts receivable and contract assets						223,257						232,986
Allowance for distribution fees and discounts						(5,932)						(1,914)
Total accounts receivable, net and contract assets						$	217,325					$	231,072

Inventories, net consisted of the following (in thousands):

						September 30, 2023						December 31, 2022
Raw materials						$	26,930					$	13,792
Work-in-process						37,573						40,361
Finished goods						64,418						45,970
Total inventories, net						$	128,921					$	100,123

Prepaid expenses and other assets consisted of the following (in thousands):

						September 30, 2023						December 31, 2022
Prepaid manufacturing expenses						$	47,527					$	51,694
Other prepaid expenses						7,258						4,647
Other assets						12,808						14,984
Total prepaid expenses and other assets						67,593						71,325
Less: Long-term portion						(18,115)						(26,301)
Total prepaid expenses and other assets, current						$	49,478					$	45,024

Prepaid manufacturing expenses include raw materials, slot reservation fees and other amounts paid to contract manufacturing organizations. Such amounts are reclassified to work-in-process inventory as materials are used or the contract manufacturing organization services are complete.

Property and equipment, net consisted of the following (in thousands):

						September 30, 2023						December 31, 2022
Research equipment						$	8,353					$	7,380
Manufacturing equipment						31,231						27,893
Computer and office equipment						9,117						7,855
Leasehold improvements						6,856						6,729
Subtotal						55,557						49,857
Accumulated depreciation and amortization						(18,091)						(14,756)
Subtotal						37,466						35,101
Right of use of assets						37,203						40,469
Property and equipment, net						$	74,669					$	75,570

Depreciation and amortization expense was approximately $2.7 million and $2.0 million, inclusive of ROU asset amortization of $1.4 million and $0.7 million for the three months ended September 30, 2023 and 2022, respectively.

Depreciation and amortization expense was approximately $8.2 million and $3.9 million inclusive of ROU asset amortization of $4.2 million and $1.7 million for the nine months ended September 30, 2023 and 2022, respectively.

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Accrued expenses consisted of the following (in thousands):

						September 30, 2023						December 31, 2022
Accrued compensation and payroll taxes						$	13,995					$	19,939
Accrued outsourced manufacturing expenses						13,870						12,190
Income taxes payable						18,029						—
Product returns and sales allowance						36,458						30,261
Other accrued expenses						8,912						29,771
Lease liability						32,358						34,788
Total accrued expenses						123,622						126,949
Less long-term portion						(28,422)						(30,433)
Total accrued expenses, current						$	95,200					$	96,516

Expense associated with the accretion of the lease liabilities was approximately $0.6 million and $0.1 million for the three months ended September 30, 2023 and 2022, respectively and $1.9 million and $0.3 million for the nine months ended September 30, 2023 and 2022, respectively. Total lease expense for the three months ended September 30, 2023 and 2022 was $2.0 million and $0.9 million, respectively and $6.1 million and $2.0 million for the nine months ended September 30, 2023 and 2022, respectively.

Cash paid for amounts related to leases for the three months ended September 30, 2023 and 2022 was $1.6 million and $1.1 million, respectively and $5.0 million and $2.7 million for the nine months ended September 30, 2023 and 2022, respectively.

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Goodwill

A summary of the activity impacting goodwill is presented below (in thousands):

Balance as of December 31, 2022						$	409,049
Measurement period adjustment (1)						7,772
Balance as of September 30, 2023						$	416,821

(1) Refer to Note 3, Business Combination, for further discussion on the measurement period adjustment.

Intangible Assets

Our acquired intangible assets are amortized using the straight-line method over their estimated useful lives of seven to ten years. The following table shows the cost, accumulated amortization and weighted average useful life in years for our acquired intangible assets as of September 30, 2023 (in thousands).

						Weighted average useful life (in years)						Gross Carrying Value						Accumulated Amortization						Net Carrying Value
Auto injector technology platform						7						$	402,000					$	77,806					$	324,194
XYOSTED proprietary product						10						136,200						18,453						117,747
Total finite-lived intangibles, net (1)												$	538,200					$	96,259					$	441,941
ATRS-1902 (IPR&D)						Indefinite																		48,700
Total intangibles, net																								$	490,641

(1) An impairment charge of $2.5 million was recognized in the three months ended September 30, 2023 resulting in the full impairment of the TLANDO product rights intangible asset. The impairment charge resulted from the notice of termination of the TLANDO license agreement provided to Lipocine in September 2023, effective January 31, 2024, and is included in amortization of intangibles in our condensed consolidated statements of income.

Estimated future annual amortization of finite-lived intangible assets is shown in the following table (in thousands). Actual amortization expense to be reported in future periods could differ from these estimates as a result of acquisitions, divestitures, and asset impairments, among other factors.

Year						Amortization Expense
Remainder of 2023						$	17,762
2024						71,049
2025						71,049
2026						71,049
2027						71,049
Thereafter						139,983
Total						$	441,941

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1.00% Convertible Notes due 2028

In August 2022, we completed the sale of $720.0 million in aggregate principal amount of 1.00% Convertible Senior Notes due 2028 (the “2028 Convertible Notes”). The net proceeds in connection with the issuance of the 2028 Convertible Notes, after deducting the initial purchasers’ fee of $18.0 million, was approximately $702.0 million. We also incurred additional debt issuance costs totaling $1.0 million. Debt issuance costs and the initial purchasers’ fee are presented as a debt discount.

The 2028 Convertible Notes pay interest semi-annually in arrears on February 15th and August 15th of each year at an annual rate of 1.00%. The 2028 Convertible Notes are general unsecured obligations and rank senior in right of payment to all indebtedness that is expressly subordinated in right of payment to the 2028 Convertible Notes, rank equally in right of payment with all existing and future liabilities that are not so subordinated, are effectively junior to any secured indebtedness to the extent of the value of the assets securing such indebtedness, and are structurally subordinated to all indebtedness and other liabilities (including trade payables) of our current or future subsidiaries. The 2028 Convertible Notes have a maturity date of August 15, 2028.

Holders may convert their 2028 Convertible Notes at their option only in the following circumstances: (1) during any calendar quarter commencing after the calendar quarter ending on December 31, 2022, if the last reported sale price per share of common stock exceeds 130% of the conversion price for each of at least 20 trading days during the 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter; (2) during the five consecutive business days immediately after any five consecutive trading day period (such five consecutive trading day period, the “measurement period”) in which the trading price per $1,000 principal amount of notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price per share of our common stock on such trading day and the conversion rate on such trading day; (3) upon the occurrence of certain corporate events or distributions on our common stock, as described in the offering memorandum for the 2028 Convertible Notes; (4) if we call such notes for redemption; and (5) at any time from, and including, February 15, 2028 until the close of business on the second scheduled trading day immediately before the maturity date. As of September 30, 2023, the 2028 Convertible Notes were not convertible.

Upon conversion, we will pay cash for the settlement of principal, and for the premium, if applicable, we will pay cash, deliver shares of common stock or a combination of cash and shares of common stock, at our election. The initial conversion rate for the 2028 Convertible Notes is 17.8517 shares of common stock per $1,000 in principal amount of 2028 Convertible Notes, equivalent to a conversion price of approximately $56.02 per share of our common stock. The conversion rate is subject to adjustment in some events but will not be adjusted for any accrued or unpaid interest.

As of September 30, 2023, we were in compliance with all covenants and there was no material adverse change in our business, operations or financial condition.

Capped Call Transactions

In connection with the offering of the 2028 Convertible Notes, we entered into capped call transactions with certain counterparties (the “Capped Call Transactions”). The Capped Call Transactions are expected generally to reduce potential dilution to holders of our common stock upon conversion of the 2028 Convertible Notes or at our election (subject to certain conditions) offset any cash payments we are required to make in excess of the principal amount of such converted 2028 Convertible Notes. The cap price of the Capped Call Transactions is initially $75.4075 per share of common stock, representing a premium of 75% above the last reported sale price of $43.09 per share of common stock on August 15, 2022, and is subject to certain adjustments under the terms of the Capped Call Transactions. As of September 30, 2023, no capped calls had been exercised.

Pursuant to their terms, the capped calls qualify for classification within stockholders’ equity in our condensed consolidated balance sheets, and their fair value is not remeasured and adjusted as long as they continue to qualify for stockholders’ equity classification. We paid approximately $69.1 million for the Capped Calls, including applicable transaction costs, which was recorded as a reduction to additional paid-in capital in our condensed consolidated balance sheets. The Capped Call Transactions are separate transactions entered into by us with the capped call Counterparties, are not part of the terms of the Convertible Notes, and do not affect any holder’s rights under the Convertible Notes. Holders of the Convertible Notes do not have any rights with respect to the Capped Call Transactions.

0.25% Convertible Notes due 2027

In March 2021, we completed the sale of $805.0 million in aggregate principal amount of 0.25% Convertible Senior Notes due 2027 (the “2027 Convertible Notes”). The net proceeds in connection with the issuance of the 2027 Convertible Notes,

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after deducting the initial purchasers’ fee of $20.1 million, was approximately $784.9 million. We also incurred additional debt issuance costs totaling $0.4 million. Debt issuance costs and the initial purchasers’ fee are presented as a debt discount.

The 2027 Convertible Notes pay interest semi-annually in arrears on March 1st and September 1st of each year at an annual rate of 0.25%. The 2027 Convertible Notes are general unsecured obligations and will rank senior in right of payment to all indebtedness that is expressly subordinated in right of payment to the 2027 Convertible Notes, will rank equally in right of payment with all existing and future liabilities that are not so subordinated, will be effectively junior to any secured indebtedness to the extent of the value of the assets securing such indebtedness and will be structurally subordinated to all indebtedness and other liabilities (including trade payables) of our current or future subsidiaries. The 2027 Convertible Notes have a maturity date of March 1, 2027.

Holders may convert their 2027 Convertible Notes at their option only in the following circumstances: (1) during any calendar quarter commencing after the calendar quarter ending on June 30, 2021, if the last reported sale price per share of common stock exceeds 130% of the conversion price for each of at least 20 trading days during the 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter; (2) during the five consecutive business days immediately after any five consecutive trading day period (such five consecutive trading day period, the “measurement period”) in which the trading price per $1,000 principal amount of notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price per share of our common stock on such trading day and the conversion rate on such trading day; (3) upon the occurrence of certain corporate events or distributions on our common stock, as described in the offering memorandum for the 2027 Convertible Notes; (4) if we call such notes for redemption; and (5) at any time from, and including, September 1, 2026 until the close of business on the scheduled trading day immediately before the maturity date. As of September 30, 2023, the 2027 Convertible Notes were not convertible.

Upon conversion, we will pay cash for the settlement of principal, and for the premium, if applicable, we will pay cash, deliver shares of common stock or a combination of cash and shares of common stock, at our election. The initial conversion rate for the 2027 Convertible Notes will be 12.9576 shares of common stock per $1,000 in principal amount of 2027 Convertible Notes, equivalent to a conversion price of approximately $77.17 per share of our common stock. The conversion rate is subject to adjustment.

As of September 30, 2023, we were in compliance with all covenants and there was no material adverse change in our business, operations or financial condition.

1.25% Convertible Notes due 2024

In November 2019, we completed the sale of $460.0 million in aggregate principal amount of 1.25% Convertible Senior Notes due 2024 (the “2024 Convertible Notes”). The net proceeds in connection with the issuance of the 2024 Convertible Notes, after deducting the initial purchases’ fee of $12.7 million, was approximately $447.3 million. We also incurred debt issuance cost totaling $0.3 million. Debt issuance costs and the initial purchasers’ fee are presented as a debt discount.

The 2024 Convertible Notes pay interest semi-annually in arrears on June 1st and December 1st of each year, beginning on June 1, 2020, at an annual rate of 1.25%. The 2024 Convertible Notes are general unsecured obligations and will rank senior in right of payment to all indebtedness that is expressly subordinated in right of payment to the 2024 Convertible Notes, will rank equally in right of payment with all existing and future liabilities that are not so subordinated, will be effectively junior to any secured indebtedness to the extent of the value of the assets securing such indebtedness and will be structurally subordinated to all indebtedness and other liabilities (including trade payables) of our current or future subsidiaries. The 2024 Convertible Notes have a maturity date of December 1, 2024.

Holders may convert their 2024 Convertible Notes at their option only in the following circumstances: (1) during any calendar quarter commencing after the calendar quarter ending on March 31, 2020, if the last reported sale price per share of common stock exceeds 130% of the conversion price for each of at least 20 trading days during the 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter; (2) during the five consecutive business days immediately after any five consecutive trading day period (such five consecutive trading day period, the “measurement period”) in which the trading price per $1,000 principal amount of notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price per share of our common stock on such trading day and the conversion rate on such trading day; (3) upon the occurrence of certain corporate events or distributions on our common stock, as described in the offering memorandum for the 2024 Convertible Notes; (4) if we call such notes for redemption; and (5) at any time from, and including, June 1, 2024 until the close of business on the scheduled trading day immediately before the maturity date.

In January 2021, we notified the note holders of our irrevocable election to settle the principal of the 2024 Convertible Notes in cash and for the premium, if applicable, to deliver shares of common stock. The conversion rate for the 2024

---

Convertible Notes was 41.9208 shares of common stock per $1,000 in principal amount of 2024 Convertible Notes, equivalent to a conversion price of approximately $23.85 per share of our common stock. The conversion rate was subject to adjustment.

In March 2021, we completed a privately negotiated induced conversion of $369.1 million principal amount of the 2024 Convertible Notes (“2021 Note Repurchases” or the “2021 Induced Conversion”). In connection with the 2021 Induced Conversion, we paid approximately $370.2 million in cash, which includes principal and accrued interest, and issued approximately 9.08 million shares of our common stock representing the intrinsic value based on the contractual conversion rate and incremental shares as an inducement for conversion. As a result of the 2021 Induced Conversion, we recorded $21.0 million in induced conversion expense which was included in other income (expense) of our condensed consolidated statements of income in 2021. The induced conversion expense represented the fair value of the common stock issued upon conversion in excess of the common stock issuable under the original terms of the 2024 Convertible Notes.

In August 2022, we completed a privately negotiated induced conversion of $77.4 million principal amount of the 2024 Convertible Notes (“2022 Note Repurchases” or the “2022 Induced Conversion”). In connection with the 2022 Induced Conversion, we paid approximately $77.6 million in cash, which includes principal and accrued interest, and issued approximately 1.51 million shares of our common stock representing the intrinsic value based on the contractual conversion rate and incremental shares as an inducement for conversion. As a result of the 2022 Induced Conversion, we recorded $2.7 million in induced conversion expense which was included in other income (expense) of our condensed consolidated statements of income in 2022. The induced conversion expense represented the fair value of the common stock issued upon conversion in excess of the common stock issuable under the original terms of the 2024 Convertible Notes.

In January 2023, we issued a notice for the redemption of 2024 Convertible Notes. Holders of the notes could convert their notes at any time prior the close of business day prior to the redemption date. In March 2023, holders of the notes elected to convert the 2024 Convertible Notes in full. In connection with the conversion, we paid approximately $13.5 million in cash which includes principal and accrued interest, and issued 288,886 shares of our common stock representing the intrinsic value based on the contractual conversion rate.

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Net Carrying Amounts of our Convertible Notes

The carrying amount and fair value of our Convertible Notes were as follows (in thousands).

						September 30, 2023						December 31, 2022
Principal amount
2024 Convertible Notes						$	—					$	13,483
2027 Convertible Notes						805,000						805,000
2028 Convertible Notes						720,000						720,000
Total principal amount						$	1,525,000					$	1,538,483
Unamortized debt discount
2024 Convertible Notes						$	—					$	(149)
2027 Convertible Notes						(11,805)						(14,359)
2028 Convertible Notes						(15,574)						(17,875)
Total unamortized debt discount						$	(27,379)					$	(32,383)
Carrying amount
2024 Convertible Notes						$	—					$	13,334
2027 Convertible Notes						793,195						790,641
2028 Convertible Notes						704,426						702,125
Total carrying amount						$	1,497,621					$	1,506,100
Fair value based on trading levels (Level 2):
2024 Convertible Notes						$	—					$	32,176
2027 Convertible Notes						681,835						784,770
2028 Convertible Notes						674,892						849,823
Total fair value of outstanding notes						$	1,356,727					$	1,666,769
Remaining amortization per period of debt discount (in years):
2024 Convertible Notes						—						1.9
2027 Convertible Notes						3.4						4.2
2028 Convertible Notes						4.9						5.6

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The following table summarizes the components of interest expense and the effective interest rates for each of our Convertible Notes (in thousands).

						Three Months Ended  September 30,												Nine Months Ended September 30,
						2023						2022						2023						2022
Coupon interest
2024 Convertible Notes						$	—					$	161					$	36					$	729
2027 Convertible Notes						503						503						1,509						1,509
2028 Convertible Notes						1,800						860						5,400						860
Total coupon interest						$	2,303					$	1,524					$	6,945					$	3,098
Amortization of debt discount
2024 Convertible Notes						$	—					$	84					$	24					$	338
2027 Convertible Notes						853						847						2,555						2,537
2028 Convertible Notes						770						363						2,301						363
Total amortization of debt discount						$	1,623					$	1,294					$	4,880					$	3,238
Interest expense
2024 Convertible Notes						$	—					$	245					$	60					$	1,067
2027 Convertible Notes						1,356						1,350						4,064						4,046
2028 Convertible Notes						2,570						1,223						7,701						1,223
Total interest expense						$	3,926					$	2,818					$	11,825					$	6,336
Effective interest rates
2024 Convertible Notes						—						1.8		%				—						1.8		%
2027 Convertible Notes						0.7		%				0.7		%				0.7		%				0.7		%
2028 Convertible Notes						1.5		%				1.5		%				1.5		%				1.5		%

Revolving Credit and Term Loan Facilities (May 2022)

In May 2022, in connection with the closing of the Antares acquisition, we entered into a credit agreement, which was subsequently amended, with Bank of America, N.A., as Administrative Agent, Swing Line Lender and an L/C Issuer, and the other lenders and L/C Issuers party thereto (the “2022 Credit Agreement), evidencing a credit facility (the “2022 Facility”) that provides for (i) a $350 million revolving credit facility (the “Revolving Credit Facility”) and (ii) a $250 million term loan facility (the “Term Facility”). Proceeds from a $120 million draw on the Revolving Credit Facility and the $250 million Term Facility were used to fund a portion of the Antares acquisition, repay Antares’ existing debt and pay fees and expenses in connection with the Antares acquisition. The 2022 Credit Agreement contains an expansion feature, which allows us, subject to certain conditions, to increase the aggregate principal amount of the 2022 Facility, provided we remain in compliance with underlying financial covenants on a pro forma basis including the consolidated interest coverage ratio and the consolidated net leverage ratio covenants set forth in the 2022 Credit Agreement. The 2022 Facility will mature on November 30, 2026 unless either the Revolving Credit Facility or the Term Facility is extended prior to such date in accordance with the 2022 Credit Agreement.

The Term Facility requires quarterly scheduled repayments of the term loans in each of the first, second, third and fourth years following the closing in annual amounts equal to 2.50%, 5.00%, 7.50% and 10.00% of the initial principal amount of the term loans, respectively. The term loans are also subject to mandatory prepayments from the proceeds of certain asset sales, subject to our right to reinvest the proceeds thereof.

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Borrowings under the 2022 Facility bear interest, at our option, at a rate equal to an applicable margin plus: (a) the applicable Term Secured Overnight Financing Rate (“SOFR”) (which includes a SOFR adjustment of 0.10%), or (b) a base rate determined by reference to the highest of (1) the federal funds effective rate plus 0.50%, (2) the Bank of America prime rate, (3) the Term SOFR rate for an interest period of one month plus 1.10%, and (4) 1.00%. The margin for the 2022 Facility ranges, based on our consolidated total net leverage ratio, from 0.25% to 1.25% in the case of base rate loans and from 1.25% to 2.25% in the case of Term SOFR rate loans. In addition to paying interest on the outstanding principal under the Facility, we will pay (i) a commitment fee in respect of the unutilized commitments thereunder and (ii) customary letter of credit fees and agency fees. The commitment fees range from 0.15% to 0.35% per annum based on our consolidated net leverage ratio.

In August 2022, we entered into Amendment No. 1 to the Credit Agreement (the “Amendment”) among the Company, the Guarantors (as defined in the Credit Agreement), each L/C Issuer from time to time party thereto, Bank of America, N.A., as Administrative Agent (in such capacity, the “Administrative Agent”) and swing line lender (in such capacity, the “Swing Line Lender”), and each lender party thereto, which amends the Credit Agreement dated as of May 24, 2022 (the “Credit Agreement”) among the Company, the Guarantors, the Administrative Agent, the Swing Line Lender, each Lender and the L/C Issuers. The Amendment, among other things, increased the size of the revolving credit facility from $350 million to $575 million. The terms of the Revolving Credit Facility were otherwise unchanged. Concurrently, with the entry into the Amendment, we repaid the entire outstanding Term Loan Facility and repaid all outstanding loans under the Revolving Credit Facility under the 2022 Credit Agreement.

As of September 30, 2023, the Revolving Credit Facility was undrawn. We incurred a total of $3.6 million in third-party costs related to the 2022 Credit Agreement which are recorded as debt issuance cost within prepaid expenses and other assets in our condensed consolidated balance sheets. As of September 30, 2023, the unamortized debt issuance cost related to the revolving credit facility was $2.5 million.

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The following table summarized share-based compensation expense included in our condensed consolidated statements of income related to share-based awards (in thousands):

						Three Months Ended  September 30,												Nine Months Ended September 30,
						2023						2022						2023						2022
Research and development						$	3,159					$	2,695					$	9,931					$	7,168
Selling, general and administrative						6,208						4,102						17,025						10,006
Total share-based compensation expense						$	9,367					$	6,797					$	26,956					$	17,174

Share-based compensation expense by type of share-based award (in thousands):

						Three Months Ended  September 30,												Nine Months Ended September 30,
						2023						2022						2023						2022
Stock options						$	4,290					$	2,801					$	11,935					$	7,924
RSUs, PSUs and ESPP						5,077						3,996						15,021						9,250
Total share-based compensation expense						$	9,367					$	6,797					$	26,956					$	17,174

We granted stock options to purchase approximately 0.2 million and 0.1 million shares of common stock during the three months ended September 30, 2023 and 2022, respectively and 1.8 million and 1.6 million shares of common stock during the nine months ended September 30, 2023 and 2022, respectively. The exercise price of stock options granted is equal to the closing price of the common stock on the date of grant. The fair value of each option award is estimated on the date of grant using the Black-Scholes-Merton option pricing model (“Black-Scholes model”). Expected volatility is based on historical volatility of our common stock. The expected term of options granted is based on analyses of historical employee termination rates and option exercises. The risk-free interest rate is based on the U.S. Treasury yield for a period consistent with the expected term of the option in effect at the time of the grant. The dividend yield assumption is based on the expectation of no future dividend payments. The assumptions used in the Black-Scholes model were as follows:

						Three Months Ended  September 30,												Nine Months Ended September 30,
						2023						2022						2023						2022
Expected volatility						40.70 - 40.82%						40.37 - 50.80%						39.68-40.82%						40.37-50.80%
Average expected term (in years)						4.9						4.7						4.8						4.7
Risk-free interest rate						4.19 - 4.29%						2.66 - 3.39%						3.37-4.29%						1.37-3.39%
Expected dividend yield						—						—						—						—

In February 2021, our Board of Directors approved our 2021 ESPP and our stockholders approved the plan in May 2021. The ESPP enables eligible employees to purchase shares of our common stock at the end of each offering period at a price equal to 85% of the fair market value of the shares on the first business day or the last business day of the offering period, whichever is lower. Share purchases are funded through payroll deduction of at least 1% and up to 15% of an employee’s compensation for each payroll period, and no employee may purchase shares under the ESPP that exceeds $25,000 worth of our common stock for a calendar year. As of September 30, 2023, 2,630,346 shares were available for future purchase. The offering period is generally for a six-month period and the first offering period commenced on June 16, 2021. Offering periods shall commence on or about the sixteenth day of June and December of each year and end on or about the fifteenth day of the next December and June, respectively, occurring thereafter. During the nine months ended September 30, 2023, 19,757 shares were issued pursuant to the ESPP.

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Total unrecognized estimated compensation cost by type of award and the weighted-average remaining requisite service period over which such expense is expected to be recognized was as follows (in thousands, unless otherwise noted):

						September 30, 2023
						Unrecognized Expense						Remaining Weighted-Average Recognition Period (years)
Stock options						$	41,893					2.75
RSUs						36,721						2.51
PSUs						7,153						1.68
ESPP						110						0.21

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During the nine months ended September 30, 2023 and 2022, we issued an aggregate of 455,702 and 483,385 shares of common stock, respectively, in connection with the exercises of stock options at a weighted average exercise price of $18.10 and $18.45 per share, respectively, for net proceeds of approximately $8.2 million and $8.9 million, respectively. For the nine months ended September 30, 2023 and 2022, we issued 328,115 and 252,063 shares of common stock, respectively, upon vesting of certain RSUs and PSUs for which 70,733 and 68,425 RSUs were withheld from the RSU holders, respectively, to pay for minimum withholding taxes totaling approximately $7.2 million and $4.3 million, respectively. Stock options and unvested restricted units totaling approximately 7.7 million and 6.6 million shares of our common stock were outstanding as of September 30, 2023 and December 31, 2022, respectively.

Share Repurchases

In December 2021, the Board of Directors authorized a capital return program to repurchase up to $750.0 million of outstanding stock over a three-year period. During 2021, we repurchased 3.9 million shares of common stock for $150.0 million at an average price of $38.51. During 2022, we repurchased 4.5 million shares of common stock for $200.0 million at an average price of $44.44. All shares repurchased under our capital return programs have been retired and have resumed their status of authorized and unissued shares.

As of September 30, 2023, we have repurchased a total of 12.6 million shares for $500.0 million at an average price per share of $39.81 under our $750 million 3-year share repurchase plan. As of September 30, 2023, $250.0 million of outstanding stock is available to be purchased under the program.

We had the following activity under the approved share repurchase programs (dollars in thousands, except share and per share data):

						2023
						Total Number of Shares Purchased						Weighted Average Price Paid Per Share						Total Cost(1)
First quarter						4,165,258						$	36.01					$	150,083
Second quarter						—						—						—
Third quarter						—						—						—
						4,165,258						$	36.01					$	150,083

(1) Included in the total cost of shares purchased is a commission fee of $0.02 per share.

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Basic earnings per common share is computed by dividing net income for the period by the weighted average number of common shares outstanding during the period, without consideration for common stock equivalents. Outstanding stock options, unvested RSUs, unvested PSUs, common shares expected to be issued under our ESPP and the Convertible Notes are considered common stock equivalents and are only included in the calculation of diluted earnings per common share when net income is reported and their effect is dilutive.

Potentially dilutive common shares issuable upon vesting of stock options, RSUs and PSUs are determined using the average share price for each period under the treasury stock method. Potentially dilutive common shares issuable upon conversion of our Convertible Notes are determined using the if-converted method. Since we have committed to settle the principal amount of the Convertible Notes in cash upon conversion only, the number of shares for the conversion spread will be included as a dilutive common stock equivalent.

A reconciliation of the numerators and the denominators of the basic and diluted earnings per common share computations is as follows (in thousands, except per share amounts):

						Three Months Ended  September 30,												Nine Months Ended September 30,
						2023						2022						2023						2022
Numerator
Net income						$	81,837					$	61,634					$	196,206					$	144,427
Denominator
Weighted average common shares outstanding for basic earnings per share						131,965						136,527						132,896						137,370
Dilutive potential common stock outstanding
Stock options						1,830						2,237						1,882						2,211
RSUs, PSUs and ESPP						288						363						378						362
Convertible Notes						—						260						77						1,076
Weighted average common shares outstanding for diluted earnings per share						134,083						139,387						135,233						141,019
Earnings per share
Basic						$	0.62					$	0.45					$	1.48					$	1.05
Diluted						$	0.61					$	0.44					$	1.45					$	1.02

Shares which have been excluded from the calculation of diluted earnings per common share because their effect was anti-dilutive include the following (shares in millions):

						Three Months Ended  September 30,									Nine Months Ended September 30,
						2023			2022						2023						2022
Anti-dilutive securities (1)						27.4			25.6						27.6						19.0

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v3.23.3

Cover Page - shares	9 Months Ended
	Sep. 30, 2023	Oct. 31, 2023
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2023
Document Transition Report	false
Entity File Number	001-32335
Entity Registrant Name	HALOZYME THERAPEUTICS, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	88-0488686
Entity Address, Address Line One	12390 El Camino Real
Entity Address, City or Town	San Diego
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	92130
City Area Code	858
Local Phone Number	794-8889
Title of 12(b) Security	Common Stock, $0.001 par value
Trading Symbol	HALO
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		132,098,110
Entity Central Index Key	0001159036
Amendment Flag	false
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q3
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer

v3.23.3

Condensed Consolidated Balance Sheets (Unaudited) - USD ($)	Sep. 30, 2023	Dec. 31, 2022
Current assets
Cash and cash equivalents	$ 274,227,000	$ 234,195,000
Marketable securities, available-for-sale	209,055,000	128,599,000
Accounts receivable, net and contract assets	217,325,000	231,072,000
Inventories, net	128,921,000	100,123,000
Prepaid expenses and other current assets	49,478,000	45,024,000
Total current assets	879,006,000	739,013,000
Property and equipment, net	74,669,000	75,570,000
Prepaid expenses and other assets	18,115,000	26,301,000
Goodwill	416,821,000	409,049,000
Intangible assets, net	490,641,000	546,652,000
Deferred tax assets, net	13,410,000	44,426,000
Restricted cash	0	500,000
Total assets	1,892,662,000	1,841,511,000
Current liabilities
Accounts payable	19,318,000	17,693,000
Accrued expenses	95,200,000	96,516,000
Deferred revenue, current portion	667,000	3,246,000
Current portion of long-term debt, net	0	13,334,000
Total current liabilities	115,185,000	130,789,000
Deferred revenue, net of current portion	2,253,000	2,253,000
Long-term debt, net	1,497,621,000	1,492,766,000
Other long-term liabilities	28,422,000	30,433,000
Contingent liability	0	15,472,000
Total liabilities	1,643,481,000	1,671,713,000
Commitments and contingencies (Note 12)
Stockholders’ equity
Preferred stock - $0.001 par value; 20,000 shares authorized; no shares issued and outstanding	0	0
Common stock - $0.001 par value; 300,000 shares authorized; 132,081 and 135,154 shares issued and outstanding as of September 30, 2023 and December 31, 2022, respectively	132,000	135,000
Additional paid-in capital	25,537,000	27,368,000
Accumulated other comprehensive gain (loss)	1,227,000	(922,000)
Retained earnings	222,285,000	143,217,000
Total stockholders’ equity	249,181,000	169,798,000
Total liabilities and stockholders’ equity	$ 1,892,662,000	$ 1,841,511,000

v3.23.3

Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares	Sep. 30, 2023	Dec. 31, 2022
Statement of Financial Position [Abstract]
Preferred stock, par value (usd per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized (in shares)	20,000,000	20,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common stock, par value (usd per share)	$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	300,000,000	300,000,000
Common stock, shares issued (in shares)	132,081,000	135,154,000
Common stock, shares outstanding (in shares)	132,081,000	135,154,000

v3.23.3

Condensed Consolidated Statements of Income (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Revenues
Total revenues	$ 216,033	$ 208,976	$ 599,214	$ 478,620
Operating expenses
Cost of sales	54,823	47,319	140,063	97,184
Amortization of intangibles	20,341	27,193	56,011	38,596
Research and development	17,321	16,705	55,027	44,041
Selling, general and administrative	35,269	34,467	111,574	105,777
Total operating expenses	127,754	125,684	362,675	285,598
Operating income	88,279	83,292	236,539	193,022
Other income (expense)
Investment and other income, net	4,786	641	10,957	194
Inducement expense related to convertible notes	0	(2,712)	0	(2,712)
Contingent liability fair value measurement gain	13,200	0	13,200	0
Interest expense	(4,505)	(7,514)	(13,542)	(12,377)
Net income before income taxes	101,760	73,707	247,154	178,127
Income tax expense	19,923	12,073	50,948	33,700
Net income	$ 81,837	$ 61,634	$ 196,206	$ 144,427
Earnings per share
Basic (USD per share)	$ 0.62	$ 0.45	$ 1.48	$ 1.05
Diluted (USD per share)	$ 0.61	$ 0.44	$ 1.45	$ 1.02
Weighted average common shares outstanding
Basic (shares)	131,965	136,527	132,896	137,370
Diluted (shares)	134,083	139,387	135,233	141,019
Royalties
Revenues
Total revenues	$ 114,433	$ 99,551	$ 325,813	$ 254,496
Product sales, net
Revenues
Total revenues	86,569	61,427	221,252	129,867
Revenues under collaborative agreements
Revenues
Total revenues	$ 15,031	$ 47,998	$ 52,149	$ 94,257

v3.23.3

Condensed Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Statement of Comprehensive Income [Abstract]
Net income	$ 81,837	$ 61,634	$ 196,206	$ 144,427
Other comprehensive income:
Unrealized (loss) gain on marketable securities	(49)	182	706	(1,257)
Foreign currency translation adjustment	0	(1)	24	1
Unrealized gain on foreign currency	2	0	1	40
Unrealized gain on derivative instruments, net	3,426	0	2,001	0
Realized gain on derivative instruments, net	(537)	0	(583)	0
Comprehensive income	$ 84,679	$ 61,815	$ 198,355	$ 143,211

v3.23.3

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022	Dec. 31, 2022	Dec. 31, 2021
Operating activities
Net income	$ 81,837	$ 61,634	$ 196,206	$ 144,427
Adjustments to reconcile net income to net cash provided by in operating activities:
Share-based compensation			26,956	17,174
Depreciation and amortization	2,700	2,000	8,152	3,931
Amortization of intangibles	20,341	27,193	56,011	38,596
Amortization of debt discount			5,476	6,007
Amortization of (premium) discounts on marketable securities, net			(3,830)	985
Realized loss on marketable securities			0	1,727
Loss on disposal of equipment			517	80
Contingent liability fair value measurement adjustment	(13,200)	0	(13,200)	0
Recognition of deferred revenue			(2,579)	(1,573)
Lease payments recognized (deferred)			0	(638)
Induced conversion expense related to convertible notes	0	2,712	0	2,712	$ 2,700	$ 21,000
Deferred income taxes			25,083	25,329
Other			0	(228)
Changes in operating assets and liabilities:
Accounts receivable, net and other contract assets			13,546	(76,186)
Inventories			(28,353)	(14,536)
Prepaid expenses and other assets			5,299	(14,359)
Accounts payable and accrued expenses			(3,067)	24,209
Net cash provided by operating activities			286,217	157,657
Investing activities
Purchases of marketable securities			(271,617)	(225,689)
Proceeds from sales and maturities of marketable securities			195,697	725,995
Acquisition of business, net of cash acquired			0	(999,120)
Purchases of property and equipment			(12,698)	(2,466)
Proceeds from the sale of assets			0	16,021
Net cash used in investing activities			(88,618)	(485,259)
Financing activities
Proceeds from term loan			0	250,000
Repayment of term loan			0	(250,000)
Proceeds from revolving credit facilities			0	120,000
Repayment of revolving credit facilities			0	(120,000)
Repayment of 2024 Convertible Notes			(13,483)	(77,453)
Proceeds from issuance of 2028 Convertible Notes			0	702,000
Purchase of capped call			0	(69,120)
Payment of debt issuance costs			0	(6,465)
Repurchase of common stock			(150,083)	(200,001)
Proceeds from issuance of common stock under equity incentive plans, net of taxes paid related to net share settlement			5,499	7,081
Net cash (used in) provided by financing activities			(158,067)	356,042
Net increase in cash, cash equivalents and restricted cash			39,532	28,440
Cash, cash equivalents and restricted cash at beginning of period			234,695	119,219	119,219
Cash, cash equivalents and restricted cash at end of period	$ 274,227	$ 147,659	274,227	147,659	$ 234,695	$ 119,219
Supplemental disclosure of non-cash investing and financing activities:
Amounts accrued for purchases of property and equipment			533	319
Right-of-use assets obtained in exchange for lease obligation			1,211	970
Debt issuances cost included in accounts payable			0	639
Common stock issued for conversion of 2024 Convertible Notes			$ 125	$ 1,019

v3.23.3

Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock	Additional Paid-In Capital	Accumulated Other Comprehensive (Loss)/Income	Retained Earnings (Accumulated Deficit)
Equity, beginning balance (in shares) at Dec. 31, 2021		137,498
Equity, beginning balance at Dec. 31, 2021	$ 196,953	$ 138	$ 256,347	$ (620)	$ (58,912)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Share-based compensation expense	17,174		17,174
Issuance of common stock for conversion of 2024 Convertible Notes/ induced conversion related to convertible notes (in shares)		1,512
Issuance of common stock for conversion of 2024 Convertible Notes/ induced conversion related to convertible notes	1,693	$ 1	1,692
Issuance of common stock pursuant to exercise of stock options and vesting of restricted stock and performance stock units, net and shares issued under ESPP plan (in shares)		753
Issuance of common stock pursuant to exercise of stock options and vesting of restricted stock and performance stock units, net and shares issued under the ESPP plan	7,081	$ 1	7,080
Capped call transaction	(69,120)		(69,120)
Repurchase of common stock (shares)		(4,552)
Repurchase of common stock	(200,001)	$ (5)	(199,996)
Other comprehensive income (loss)	(1,216)			(1,216)
Net income	144,427				144,427
Equity, ending balance (in shares) at Sep. 30, 2022		135,211
Equity, ending balance at Sep. 30, 2022	96,991	$ 135	13,177	(1,836)	85,515
Equity, beginning balance (in shares) at Jun. 30, 2022		137,681
Equity, beginning balance at Jun. 30, 2022	293,171	$ 138	271,169	(2,017)	23,881
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Share-based compensation expense	6,797		6,797
Issuance of common stock for conversion of 2024 Convertible Notes/ induced conversion related to convertible notes (in shares)		1,512
Issuance of common stock for conversion of 2024 Convertible Notes/ induced conversion related to convertible notes	1,693	$ 1	1,692
Issuance of common stock pursuant to exercise of stock options and vesting of restricted stock and performance stock units, net and shares issued under ESPP plan (in shares)		137
Issuance of common stock pursuant to exercise of stock options and vesting of restricted stock and performance stock units, net and shares issued under the ESPP plan	2,636	$ 1	2,635
Capped call transaction	(69,120)		(69,120)
Repurchase of common stock (shares)		(4,119)
Repurchase of common stock	(200,001)	$ (5)	(199,996)
Other comprehensive income (loss)	181			181
Net income	61,634				61,634
Equity, ending balance (in shares) at Sep. 30, 2022		135,211
Equity, ending balance at Sep. 30, 2022	96,991	$ 135	13,177	(1,836)	85,515
Equity, beginning balance (in shares) at Dec. 31, 2022		135,154
Equity, beginning balance at Dec. 31, 2022	169,798	$ 135	27,368	(922)	143,217
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Share-based compensation expense	26,956		26,956
Issuance of common stock for conversion of 2024 Convertible Notes/ induced conversion related to convertible notes (in shares)		289
Issuance of common stock for conversion of 2024 Convertible Notes/ induced conversion related to convertible notes	(126)	$ 0	(126)
Issuance of common stock pursuant to exercise of stock options and vesting of restricted stock and performance stock units, net and shares issued under ESPP plan (in shares)		803
Issuance of common stock pursuant to exercise of stock options and vesting of restricted stock and performance stock units, net and shares issued under the ESPP plan	5,499	$ 1	5,498
Repurchase of common stock (shares)		(4,165)
Repurchase of common stock	(151,301)	$ (4)	(34,159)		(117,138)
Other comprehensive income (loss)	2,149			2,149
Net income	196,206				196,206
Equity, ending balance (in shares) at Sep. 30, 2023		132,081
Equity, ending balance at Sep. 30, 2023	249,181	$ 132	25,537	1,227	222,285
Equity, beginning balance (in shares) at Jun. 30, 2023		131,856
Equity, beginning balance at Jun. 30, 2023	151,033	$ 132	12,068	(1,615)	140,448
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Share-based compensation expense	9,367		9,367
Issuance of common stock pursuant to exercise of stock options and vesting of restricted stock and performance stock units, net and shares issued under ESPP plan (in shares)		225
Issuance of common stock pursuant to exercise of stock options and vesting of restricted stock and performance stock units, net and shares issued under the ESPP plan	4,102	$ 0	4,102
Other comprehensive income (loss)	2,842			2,842
Net income	81,837				81,837
Equity, ending balance (in shares) at Sep. 30, 2023		132,081
Equity, ending balance at Sep. 30, 2023	$ 249,181	$ 132	$ 25,537	$ 1,227	$ 222,285

v3.23.3

Organization and Business	9 Months Ended
	Sep. 30, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization and Business	Organization and Business Halozyme Therapeutics, Inc. is a biopharma technology platform company that provides innovative and disruptive solutions with the goal of improving the patient experience and potentially outcomes. Our proprietary enzyme, rHuPH20, is used to facilitate the subcutaneous (“SC”) delivery of injected drugs and fluids. We license our technology to biopharmaceutical companies to collaboratively develop products that combine our ENHANZE® drug delivery technology (“ENHANZE”) with the partners’ proprietary compounds. We also develop, manufacture and commercialize, for ourselves or with our partners, drug-device combination products using our advanced auto-injector technologies. Our ENHANZE partners’ approved products and product candidates are based on rHuPH20, our patented recombinant human hyaluronidase enzyme. rHuPH20 works by breaking down hyaluronan (“HA”), a naturally occurring carbohydrate that is a major component of the extracellular matrix of the SC space. This temporarily reduces the barrier to bulk fluid flow allowing for improved and more rapid SC delivery of high dose, high volume injectable biologics, such as monoclonal antibodies and other large therapeutic molecules, as well as small molecules and fluids. We refer to the application of rHuPH20 to facilitate the delivery of other drugs or fluids as ENHANZE. We license the ENHANZE technology to form collaborations with biopharmaceutical companies that develop or market drugs requiring or benefiting from injection via the SC route of administration. In the development of proprietary intravenous (“IV”) drugs combined with our ENHANZE technology, data has been generated supporting the potential for ENHANZE to reduce patient treatment burden, as a result of shorter duration of SC administration with ENHANZE compared to IV administration. ENHANZE may enable fixed-dose SC dosing compared to weight-based dosing typically required for IV administration, extend the dosing interval for drugs that are already administered subcutaneously and potentially allow for lower rates of infusion related reactions. ENHANZE may enable more flexible treatment options such as home administration by a healthcare professional or potentially the patient or caregiver. Lastly, certain proprietary drugs co-formulated with ENHANZE have been granted additional exclusivity, extending the patent life of the product beyond the patent expiry of the proprietary IV drug. We currently have ENHANZE collaborations and licensing agreements with F. Hoffmann-La Roche, Ltd. and Hoffmann-La Roche, Inc. (“Roche”), Takeda Pharmaceuticals International AG and Baxalta US Inc. (“Takeda”), Pfizer Inc. (“Pfizer”), Janssen Biotech, Inc. (“Janssen”), AbbVie, Inc. (“AbbVie”), Eli Lilly and Company (“Lilly”), Bristol-Myers Squibb Company (“BMS”), Alexion Pharma International Operations Unlimited Company (an indirect wholly owned subsidiary of AstraZeneca PLC) (“Alexion”), argenx BVBA (“argenx”), Horizon Therapeutics plc. (a wholly owned subsidiary of Amgen Inc.) (“Horizon”), ViiV Healthcare (the global specialist HIV Company majority owned by GlaxoSmithKline) (“ViiV”), Chugai Pharmaceutical Co., Ltd (“Chugai”) and Acumen Pharmaceuticals, Inc. (“Acumen”). In addition to receiving upfront licensing fees from our ENHANZE collaborations, we are entitled to receive event and sales-based milestone payments, revenues from the sale of bulk rHuPH20 and royalties from commercial sales of approved partner products co-formulated with ENHANZE. We currently earn royalties from four of these collaborations, including royalties from sales of one product from the Takeda collaboration, four products from the Roche collaboration, one product from the Janssen collaboration and one product from the argenx collaboration. We have commercialized auto-injector products with several pharmaceutical companies including Teva Pharmaceutical Industries, Ltd. (“Teva”) and Otter Pharmaceuticals, LLC (“Otter”). We have development programs including auto-injectors with Idorsia Pharmaceuticals Ltd. (“Idorsia”). Our commercial portfolio of proprietary products includes Hylenex®, utilizing rHuPH20, and our specialty products XYOSTED®, utilizing our auto-injector technology, and TLANDO®, an oral formulation of testosterone.. Except where specifically noted or the context otherwise requires, references to “Halozyme,” “the Company,” “we,” “our,” and “us” in these notes to our condensed consolidated financial statements refer to Halozyme Therapeutics, Inc. and each of its directly and indirectly wholly owned subsidiaries

v3.23.3

Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2023
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	Summary of Significant Accounting Policies Basis of Presentation The accompanying interim unaudited condensed consolidated financial statements have been prepared for purposes of and in accordance with United States generally accepted accounting principles (“U.S. GAAP”) and with the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) related to a quarterly report on Form 10-Q. Accordingly, they do not include all of the information and disclosures required by U.S. GAAP for a complete set of financial statements. These interim unaudited condensed consolidated financial statements and notes thereto should be read in conjunction with the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on February 21, 2023. The unaudited financial information for the interim periods presented herein reflects all adjustments which, in the opinion of management, are necessary for a fair presentation of the financial condition and results of operations for the periods presented, with such adjustments consisting only of normal recurring adjustments. Operating results for interim periods are not necessarily indicative of the operating results for an entire fiscal year. The accompanying interim unaudited condensed consolidated financial statements include the accounts of Halozyme Therapeutics, Inc. and our wholly owned subsidiaries, Halozyme, Inc. and Antares Pharma, Inc., and Antares Pharma, Inc.’s wholly owned Swiss subsidiaries, Antares Pharma IPL AG and Antares Pharma AG. All intercompany accounts and transactions have been eliminated. Use of Estimates The preparation of interim unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires us to make estimates and assumptions that affect the amounts reported in our interim unaudited condensed consolidated financial statements and accompanying notes. On an ongoing basis, we evaluate our estimates and judgments, which are based on historical and anticipated results and trends and on various other assumptions that we believe to be reasonable under the circumstances. By their nature, estimates are subject to an inherent degree of uncertainty and, as such, actual results may differ from our estimates. Cash Equivalents and Marketable Securities Cash equivalents consist of highly liquid investments, readily convertible to cash, that mature within 90 days or less from the date of purchase. As of September 30, 2023, our cash and cash equivalents consisted of money market funds, bank certificate of deposits, U.S. treasury securities and demand deposits at commercial banks. Marketable securities are investments with original maturities of more than 90 days from the date of purchase that are specifically identified to fund current operations. Marketable securities are considered available-for-sale. These investments are classified as current assets, even though the stated maturity date may be one year or more beyond the current balance sheet date which reflects management’s intention to use the proceeds from the sale of these investments to fund our operations, as necessary. Such available-for-sale investments are carried at fair value with unrealized gains and losses recorded in other comprehensive income (loss) and included as a separate component of stockholders’ equity. The cost of marketable securities is adjusted for amortization of premiums or accretion of discounts to maturity, and such amortization or accretion is included in investment and other income, net in our condensed consolidated statements of income. We use the specific identification method for calculating realized gains and losses on marketable securities sold. None of the realized gains and losses and declines in value that were judged to be as a result of credit loss on marketable securities, if any, are included in investment and other income, net in our condensed consolidated statements of income. Restricted Cash Under the lease terms of our facilities, we may be required to maintain letters of credit as security deposits during the terms of such leases. As of September 30, 2023, no restricted cash remained pledged as collateral for the letters of credit as the associated lease was terminated. As of December 31, 2022, restricted cash of $0.5 million was pledged as collateral for the letters of credit. Fair Value of Financial Instruments The authoritative guidance for fair value measurements establishes a three tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include: Level 1, defined as observable inputs such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions. Our financial instruments include cash equivalents, available-for-sale marketable securities, accounts receivable, prepaid expenses and other assets, accounts payable, accrued expenses and long-term debt. Fair value estimates of these instruments are made at a specific point in time based on relevant market information. These estimates may be subjective in nature and involve uncertainties and matters of significant judgment and therefore, cannot be determined with precision. The carrying amount of cash equivalents, accounts receivable, prepaid expenses and other assets, accounts payable and accrued expenses are generally considered to be representative of their respective fair values because of the short-term nature of those instruments. Available-for-sale marketable securities consist of asset-backed securities, corporate debt securities, U.S. Treasury securities, agency bonds and commercial paper, and are measured at fair value using Level 1 and Level 2 inputs. Level 2 financial instruments are valued using market prices on less active markets and proprietary pricing valuation models with observable inputs, including interest rates, yield curves, maturity dates, issue dates, settlement dates, reported trades, broker-dealer quotes, issue spreads, benchmark securities or other market related data. We obtain the fair value of Level 2 investments from our investment manager, who obtains these fair values from a third-party pricing source. We validate the fair values of Level 2 financial instruments provided by our investment manager by comparing these fair values to a third-party pricing source. Inventories Inventories are stated at lower of cost or net realizable value. Cost is determined on a first-in, first-out basis. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. Inventories are reviewed periodically for potential excess, dated or obsolete status. We evaluate the carrying value of inventories on a regular basis, taking into account such factors as historical and anticipated future sales compared to quantities on hand, the price we expect to obtain for products in their respective markets compared with historical cost and the remaining shelf life of goods on hand. Leases We have entered into operating leases primarily for real estate and automobiles. These leases have contractual terms which range from three years to 12 years. We determine if an arrangement contains a lease at inception. Right of use (“ROU”) assets and liabilities resulting from operating leases are included in property and equipment, accrued expenses and other long-term liabilities on our condensed consolidated balance sheets. Operating lease ROU assets and liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the discount rate to calculate the present value of future payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. Our leases often include options to extend or terminate the lease. These options are included in the lease term when it is reasonably certain that we will exercise that option. Short-term leases with an initial term of 12 months or less are not recorded on our condensed consolidated balance sheets. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. We have lease agreements with lease and non-lease components, which are generally accounted for separately. For certain equipment leases, such as automobiles, we account for the lease and non-lease components as a single lease component. Convertible Notes The 2024 Convertible Notes, the 2027 Convertible Notes and the 2028 Convertible Notes (collectively, the “Convertible Notes”) are accounted for in accordance with authoritative guidance for debt and derivatives. We evaluate all the embedded conversion options contained in the Convertible Notes to determine if there are embedded features that require bifurcation as a derivative as required by U.S. GAAP. Based on our analysis, we account for each of our Convertible Notes as single units of accounting, a liability, because we concluded that the conversion features do not require bifurcation as a derivative under embedded derivative authoritative guidance. Cash Flow Hedges - Currency Risks Beginning in the second quarter of 2023, we entered into a cash flow hedging program to mitigate foreign currency exchange risk associated with forecasted royalty revenue denominated in Swiss francs. Under the program, we can hedge these forecasted royalties up to a maximum of four years into the future. We hedge these cash flow exposures to reduce the risk of our earnings and cash flows being adversely affected by fluctuations in exchange rates. In accordance with the hedge accounting treatment, all hedging relationships are formally documented at the inception of the hedge and are highly effective in offsetting changes to future cash flows on hedged transactions. Both at inception of the hedge and on an ongoing basis, we assess whether the foreign currency forward contracts are highly effective in offsetting changes in cash flows of hedged items on a prospective and retrospective basis. If we determine a (i) foreign currency forward contract is not highly effective as a cash flow hedge, (ii) foreign currency forward contract has ceased to be a highly effective hedge or (iii) forecasted transaction is no longer probable of occurring, we would discontinue hedge accounting treatment prospectively. We measure effectiveness based on the change in fair value of the forward currency forward contract and the fair value of the hypothetical foreign currency forward contract with terms that match the critical terms of the risk being hedged. No portion of our foreign currency forward contracts were excluded from the assessment of hedge effectiveness. As of September 30, 2023, all hedges were determined to be highly effective. The assets or liabilities associated with our hedging contracts are recorded at fair market value in prepaid expense and other current assets, accrued expenses, or other long-term liabilities, respectively, in our condensed consolidated balance sheets. Gains and losses related to changes in the fair market value of these hedging contracts are recorded as a component of accumulated other comprehensive income (loss) (“AOCI”) within stockholder’s equity in our condensed consolidated balance sheets and reclassified to royalty revenue in our condensed consolidated statements of income in the same period as the recognition of the underlying hedged transaction. In the event the underlying forecasted transaction does not occur, or it becomes probable that it will not occur, within the defined hedge period, we reclassify the gains or losses on the related cash flow hedge from AOCI to royalties revenue in our condensed consolidated statements of income. Since the fair market value of these hedging contracts is derived from current market rates, the hedging contracts are classified as derivative financial instruments. We do not use derivatives for speculative or trading purposes. As of September 30, 2023, amounts expected to be recognized as a net gain out of AOCI into our condensed consolidated statements of income during the next 12 months, are not material. Business Combinations Under the acquisition method of accounting, we allocate the fair value of the total consideration transferred to the tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values on the date of acquisition. These valuations require us to make estimates and assumptions, especially with respect to intangible assets. We record the excess consideration over the aggregate fair value of tangible and intangible assets, net of liabilities assumed, as goodwill. Costs incurred to complete a business combination, such as legal and other professional fees, are expensed as incurred. If the initial accounting for a business combination is incomplete by the end of a reporting period that falls within the measurement period, we report provisional amounts in our financial statements. During the measurement period, we adjust the provisional amounts recognized at the acquisition date to reflect new information obtained about facts and circumstances that existed as of the acquisition date that, if known, would have affected the measurement of the amounts recognized as of that date. We record these adjustments to the provisional amounts with a corresponding offset to goodwill. Any adjustments identified after the measurement period are recorded in our condensed consolidated statements of income. Goodwill, Intangible Assets and Other Long-Lived Asset Assets acquired, including intangible assets and in-process research and development (“IPR&D”), and liabilities assumed are measured at fair value as of the acquisition date. Goodwill, which has an indefinite useful life, represents the excess of cost over fair value of the net assets acquired. Intangible assets acquired in a business combination that are used for IPR&D activities are considered indefinite lived until the completion or abandonment of the associated research and development efforts. Upon reaching the end of the relevant research and development project (i.e., upon commercialization), the IPR&D asset is amortized over its estimated useful life. If the relevant research and development project is abandoned, the IPR&D asset is expensed in the period of abandonment. Goodwill and IPR&D are not amortized; however, they are reviewed for impairment at least annually during the second quarter, or more frequently if an event occurs indicating the potential for impairment. Goodwill and IPR&D are considered to be impaired if the carrying value of the reporting unit or IPR&D asset exceeds its respective fair value. We perform our goodwill impairment analysis at the reporting unit level, which aligns with our reporting and operating segment structure and availability of discrete financial information. During the goodwill impairment review, we assess qualitative factors to determine whether it is more likely than not that the fair values of our reporting unit is less than the carrying amount, including goodwill. The qualitative factors include, but are not limited to, macroeconomic conditions, industry and market considerations, and our overall financial performance. If, after assessing the totality of these qualitative factors, we determine that it is not more likely than not that the fair value of our reporting unit is less than the carrying amounts, then no additional assessment is deemed necessary. Otherwise, we proceed to compare the estimated fair value of the reporting unit with the carrying value, including goodwill. If the carrying amount of the reporting unit exceeds the fair value, we record an impairment loss based on the difference. We may elect to bypass the qualitative assessment in a period and proceed to perform the quantitative goodwill impairment test. Our identifiable intangible assets with finite useful lives are typically comprised of acquired device technologies and product rights. The cost of identifiable intangible assets with finite lives is generally amortized on a straight-line basis over the assets’ respective estimated useful lives. We perform regular reviews to determine if any event has occurred that may indicate intangible assets with finite useful lives and other long-lived assets are potentially impaired. If indicators of impairment exist, an impairment test is performed to assess the recoverability of the affected assets by determining whether the carrying amount of such assets exceeds the undiscounted expected future cash flows. If the affected assets are not recoverable, we estimate the fair value of the assets and record an impairment loss if the carrying value of the assets exceeds the fair value. Factors that may indicate potential impairment include a significant decline in our stock price and market capitalization compared to the net book value, significant changes in the ability of a particular asset to generate positive cash flows for our strategic business objectives, and the pattern of utilization of a particular asset. Revenue Recognition We generate revenues from payments received (i) as royalties from licensing our ENHANZE technology and other royalty arrangements, (ii) under collaborative agreements and (iii) from sales of our proprietary and partnered products. We recognize revenue when we transfer promised goods or services to customers in an amount that reflects the consideration to which we expect to be entitled in exchange for those goods or services. To determine revenue recognition for contracts with customers, we perform the following five steps: (i) identify the promised goods or services in the contract; (ii) identify the performance obligations in the contract, including whether they are distinct in the context of the contract; (iii) determine the transaction price, including the constraint on variable consideration; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) we satisfy the performance obligations. ENHANZE and Device Royalties Under the terms of our ENHANZE collaboration and license agreements, our partners will pay us royalties at an on average mid-single digit percent rate of their sales if products under the collaboration are commercialized. All amounts owed to us are noncancelable after the underlying triggering event occurs, and nonrefundable once paid. Unless terminated earlier in accordance with its terms, collaborations generally continue in effect until the last to expire royalty payment term, as determined on a product by product and country by country basis, with each royalty term starting on the first commercial sale of that product and ending the later of: (i) a specified period or term set forth in the agreement or (ii) expiration of the last to expire of the valid claims of our patents covering rHuPH20 or other specified patents developed under the collaboration which valid claim covers a product developed under the collaboration. In general, when there are no valid claims of a specified patent developed under the collaboration covering the product in a given country, the royalty rate is reduced for those sales in that country upon the expiration of our patents covering rHuPH20. Janssen’s patents covering DARZALEX SC do not impact the timing for this royalty reduction. Partners may terminate the agreement prior to expiration for any reason in its entirety or on a target-by-target basis generally upon 90 days prior written notice to us. Upon any such termination, the license granted to partners (in total or with respect to the terminated target, as applicable) will terminate provided; however, that in the event of expiration of the agreement (as opposed to a termination), the on-going licenses granted will become perpetual, non-exclusive and fully paid. Sales-based milestones and royalties are recognized in the period the underlying sales or milestones occur. We do not receive final royalty reports from our ENHANZE partners until after we complete our financial statements for a prior quarter. Therefore, we recognize revenue based on estimates of the royalty earned, which are based on internal estimates and available preliminary reports provided by our partners. We will record adjustments in the following quarter, if necessary, when final royalty reports are received. To date, we have not recorded any material adjustments. We also earn royalties in connection with several of our licenses granted under license and development arrangements with our device partners. These royalties are based upon a percentage of commercial sales of partnered products with rates ranging from mid-single digits to low double digits and are tiered based on levels of net sales. These sales-based royalties, for which the license was deemed the predominant element to which the royalties relate, are estimated and recognized in the period in which the partners’ commercial sales occur. The royalties are generally reported and payable to us within 45 to 60 days after the end of the period in which the commercial sales are made. We base our estimates of royalties earned on actual sales information from our partners when available or estimated, prescription sales from external sources and estimated net selling price. We will record adjustments in the following quarter, if necessary, when final royalty reports are received. To date, we have not recorded any material adjustments. Revenue under ENHANZE and Device Collaborative Agreements ENHANZE Collaboration and License Agreements Under these agreements, we grant the collaboration partner a worldwide license to develop and commercialize products using our ENHANZE technology to combine our patented rHuPH20 enzyme with their proprietary biologics directed at up to a specified number of targets. Targets are usually licensed on an exclusive, global basis. Targets selected subsequent to inception of the arrangement generally require payment of an additional license fee. The collaboration partner is responsible for all development, manufacturing, clinical, regulatory, sales and marketing costs for any products developed under the agreement. We are responsible for supply of bulk rHuPH20 based on the collaboration partner’s purchase orders, and may also be separately engaged to perform research and development services. While these collaboration agreements are similar in that they originate from the same framework, each one is the result of an arms-length negotiation and thus may vary from one to the other. We generally collect an upfront license payment from collaboration partners, and are also entitled to receive event-based payments subject to collaboration partners’ achievement of specified development, regulatory and sales-based milestones. In several agreements, collaboration partners pay us annual fees to maintain their exclusive license rights if they are unable to advance product development to specified stages. We earn separate fees for bulk rHuPH20 supplies and research and development services. Although these agreements are in form identified as collaborative agreements, we concluded for accounting purposes they represent contracts with customers and are not subject to accounting literature on collaborative arrangements. This is because we grant to partners licenses to our intellectual property and provide supply of bulk rHuPH20 and research and development services which are all outputs of our ongoing activities, in exchange for respective consideration. Under these collaborative agreements, our partners lead development of assets, and we do not share in significant financial risks of their development or commercialization activities. Accordingly, we concluded our collaborative agreements are appropriately accounted for pursuant to U.S. GAAP. Under all of our ENHANZE collaborative agreements, we have identified licenses to use functional intellectual property as the only performance obligation. The intellectual property underlying the license is our proprietary ENHANZE technology which represents application of rHuPH20 to facilitate delivery of drugs. Each of the licenses grants the partners rights to use our intellectual property as it exists and is identified on the effective date of the license, because there is no ongoing development of the ENHANZE technology required. Therefore, we recognize revenue from licenses at the point when the license becomes effective and the partner has received access to our intellectual property, usually at the inception of the agreement. When partners can select additional targets to add to the licenses granted, we consider these rights to be options. We evaluate whether such options contain material rights, i.e. have exercise prices that are discounted compared to what we would charge for a similar license to a new partner. The exercise price of these options includes a combination of the target selection fees, event-based milestone payments and royalties. When these amounts in aggregate are not offered at a discount that exceeds discounts available to other customers, we conclude the option does not contain a material right, and we consider grants of additional licensing rights upon option exercises to be separate contracts (target selection contracts). Generally, we provide indemnification and protection of licensed intellectual property for our customers. These provisions are part of assurance that the licenses meet the agreements’ representations and are not obligations to provide goods or services. We also fulfill purchase orders for supply of bulk rHuPH20 and perform research and development services pursuant to projects authorization forms for our partners, which represent separate contracts. In addition to our licenses, we price our supply of bulk rHuPH20 and research and development services at our regular selling prices, called standalone selling prices (“SSP”). Therefore, our partners do not have material rights to order these items at prices not reflective of SSP. Refer to the discussion below regarding recognition of revenue for these separate contracts. Transaction price for a contract represents the amount to which we are entitled in exchange for providing goods and services to the customer. Transaction price does not include amounts subject to uncertainties unless it is probable that there will be no significant reversal of revenue when the uncertainty is resolved. Apart from the upfront license payment (or target selection fees in the target selection contracts), all other fees we may earn under our collaborative agreements are subject to significant uncertainties of product development. Achievement of many of the event-based development and regulatory milestones may not be probable until such milestones are actually achieved. This generally relates to milestones such as obtaining marketing authorization approvals. With respect to other development milestones, e.g., dosing of a first patient in a clinical trial, achievement could be considered probable prior to its actual occurrence, based on the progress towards commencement of the trial. In order to evaluate progress towards commencement of a trial, we assess the status of activities leading up to our partner’s initiation of a trial such as feedback received from the applicable regulatory authorities, completion of Investigational New Drug (“IND”) or equivalent filings, readiness and availability of drug, readiness of study sites and our partner’s commitment of resources to the program. We do not include any amounts subject to uncertainties in the transaction price until it is probable that the amount will not result in a significant reversal of revenue in the future. At the end of each reporting period, we re-evaluate the probability of achievement of such milestones and any related constraint, and if necessary, adjust our estimate of the overall transaction price. When target exchange rights are held by partners, and the amounts attributed to these rights are not refundable, they are included in the transaction price. However, they are recorded as deferred revenues because we have a potential performance obligation to provide a new target upon an exchange right being exercised. These amounts are recognized in revenue when the right of exchange expires or is exercised. Because our agreements have one type of performance obligation (licenses) which are typically all transferred at the same time at agreement inception, allocation of transaction price often is not required. However, allocation is required when licenses for some of the individual targets are subject to rights of exchange, because revenue associated with these targets cannot be recognized. When allocation is needed, we perform an allocation of the upfront amount based on relative SSP of licenses for individual targets. We determine license SSP using an income-based valuation approach utilizing risk-adjusted discounted cash flow projections of the estimated return a licensor would receive. When amounts subject to uncertainties, such as milestones and royalties, are included in the transaction price, we attribute them to the specific individual target licenses which generate such milestone or royalty amounts. We also estimate SSP of bulk rHuPH20 and research and development services, to determine that our partners do not have material rights to order them at discounted prices. For supplies of bulk rHuPH20, because we effectively act as a contract manufacturer to our partners, we estimate and charge SSP based on the typical contract manufacturer margins consistent with all of our partners. We determine SSP of research and development services based on a fully-burdened labor rate. Our rates are comparable to those we observe in other collaborative agreements. We also have a history of charging similar rates to all of our partners. Upfront amounts allocated to licenses to individual targets are recognized as revenue when the license is transferred to the partner, as discussed above, if the license is not subject to exchange rights, or when the exchange right expires or is exercised. Development milestones and other fees are recognized in revenue when they are included in the transaction price, because by that time, we have already transferred the related license to the partner. In contracts to provide research and development services, such services represent the only performance obligation. The fees are charged based on hours worked by our employees and the fixed contractual rate per hour, plus third-party pass-through costs, on a monthly basis. We recognize revenues as the related services are performed based on the amounts billed, as the partner consumes the benefit of research and development work simultaneously as we perform these services, and the amounts billed reflect the value of these services to the customer. Device License, Development and Supply Arrangements We have several license, development and supply arrangements with pharmaceutical partners, under which we grant a license to our device technology and provide research and development services that often involve multiple performance obligations and highly-customized deliverables. For such arrangements, we identify each of the promised goods and services within the contract and the distinct performance obligations at inception of the contract and allocate consideration to each performance obligation based on relative SSP, which is generally determined based on the expected cost plus mark-up. If the contract includes an enforceable right to payment for performance completed to date and performance obligations are satisfied over time, we recognize revenue over the development period using either the input or output method depending on which is most appropriate given the nature of the distinct deliverable. For other contracts that do not contain an enforceable right to payment for performance completed to date, revenue is recognized when control of the product is transferred to the customer. Factors that may indicate transfer of control has occurred include the transfer of legal title, transfer of physical possession, the customer has obtained the significant risks and rewards of ownership of the assets and we have a present right to payment. Our typical payment terms for development contracts may include an upfront payment equal to a percentage of the total contract value with the remaining portion to be billed upon completion and transfer of the individual deliverables or satisfaction of the individual performance obligations. We record a contract liability for cash received in advance of performance, which is presented within deferred revenue and deferred revenue, long-term in our condensed consolidated balance sheets and recognized as revenue in our condensed consolidated statements of income when the associated performance obligations have been satisfied. License fees and milestones received in exchange for the grant of a license to our functional intellectual property, such as patented technology and know-how in connection with a partnered development arrangement, are generally recognized at inception of the arrangement, or over the development period depending on the facts and circumstances, as the license is generally not distinct from the non-licensed goods or services to be provided under the contract. Milestone payments that are contingent upon the occurrence of future events are evaluated and recorded at the most likely amount, and to the extent that it is probable that a significant reversal of revenue will not occur when the associated uncertainty is resolved. Refer to Note 5, Revenue, for further discussion on our collaborative arrangements. Product Sales, Net Proprietary Product Sales Our commercial portfolio of proprietary products includes XYOSTED, TLANDO and Hylenex recombinant which we sell primarily to wholesale pharmaceutical distributors and specialty pharmacies, who sell the products to hospitals, retail chain drug stores and other end-user customers. Sales to wholesalers are made pursuant to purchase orders subject to the terms of a master agreement, and delivery of individual packages of products represents performance obligations under each purchase order. We use contract manufacturers to produce our proprietary products and third-party logistics (“3PL”) vendors to process and fulfill orders. We concluded we are the principal in the sales to wholesalers because we control access to services rendered by both vendors and direct their activities. We have no significant obligations to wholesalers to generate pull-through sales. Revenue is recognized when control has transferred to the customer, which is typically upon delivery, at the net selling price, which reflects the variable consideration for which reserves and sales allowances are established for estimated returns, wholesale distribution fees, prompt payment discounts, government rebates and chargebacks, plan rebate arrangements and patient discount and support programs. We recognize revenue from product sales and related cost of sales upon product delivery to the wholesaler location. At that time, the wholesalers take control of the product as they take title, bear the risk of loss of ownership, and have an enforceable obligation to pay us. They also have the ability to direct sales of product to their customers on terms and at prices they negotiate. Although wholesalers have product return rights, we do not believe they have a significant incentive to return the product to us. The determination of certain reserves and sales allowances requires us to make a number of judgements and estimates to reflect our best estimate of the transaction price and the amount of consideration to which we believe we would be ultimately entitled to receive. The expected value is determined based on unit sales data, contractual terms with customers and third-party payers, historical and estimated future percentage of rebates incurred on sales, historical and future insurance plan billings, any new or anticipated changes in programs or regulations that would impact the amount of the actual rebates, customer purchasing patterns, product expiration dates and levels of inventory in the distribution channel. The estimated amounts of credit for product returns, chargebacks, distribution fees, prompt payment discounts, rebates and customer co-pay support programs are included in accrued expenses and accounts receivable, net in our condensed consolidated balance sheets upon recognition of revenue from product sales. We monitor actual product returns, chargebacks, discounts and fees subsequent to the sale. If these amounts differ from our estimates, we make adjustments to these allowances, which are applied to increase or reduce product sales revenue and earnings in the period of adjustment. Selling prices initially billed to wholesalers are subject to discounts for prompt payment and subsequent chargebacks when wholesalers sell our products at negotiated discounted prices to members of certain group purchasing organizations (“GPOs”), Pharmacy Benefit Managers (“PBMs”) and government programs. We also pay quarterly distribution fees to certain wholesalers for inventory reporting and chargeback processing, and to PBMs and GPOs as administrative fees for services and for access to their members. We concluded the benefits received in exchange for these fees are not distinct from our sales of our products, and accordingly we apply these amounts to reduce revenues. Wholesalers also have rights to return unsold product nearing or past the expiration date. Because of the shelf life of our products and our lengthy return period, there may be a significant period of time between when the product is shipped and when we issue credits on returned product. We estimate the transaction price when we receive each purchase order taking into account the expected reductions of the selling price initially billed to the wholesaler arising from all of the above factors. We have compiled historical experience and data to estimate future returns and chargebacks of our products and the impact of the other discounts and fees we pay. When estimating these adjustments to the transaction price, we reduce it sufficiently to be able to assert that it is probable that there will be no significant reversal of revenue when the ultimate adjustment amounts are known. Each purchase order contains only one type of product, and is usually shipped to the wholesaler in a single shipment. Therefore, allocation of the transaction price to individual packages is not required. In connection with the orders placed by wholesalers, we incur costs such as commissions to our sales representatives. However, as revenue from product sales is recognized upon delivery to the wholesaler, which occurs shortly after we receive a purchase order, we do not capitalize these commissions and other costs, based on application of the practical expedient allowed within the applicable guidance. Partnered Product Sales Bulk rHuPH20 We sell bulk rHuPH20 to partners for use in research and development and, subsequent to receiving marketing approval, we sell it for use in collaboration commercial products. Sales are made pursuant to purchase orders subject to the terms of the collaborative agreement or a supply agreement, and delivery of units of bulk rHuPH20 represent performance obligations under each purchase order. We provide a standard warranty that the product conforms to specifications. We use contract manufacturers to produce bulk rHuPH20 and have concluded we are the principal in the sales to partners. The transaction price for each purchase order of bulk rHuPH20 is fixed based on the cost of production plus a contractual markup, and is not subject to adjustments. Allocation of the transaction price to individual quantities of the product is usually not required because each order contains only one type of product. We recognize revenue from the sale of bulk rHuPH20 as product sales and related cost of sales upon transfer of title to our partners. At that time, the partners take control of the product, bear the risk of loss of ownership, and have an enforceable obligation to pay us. Devices We are party to several license, development, supply and distribution arrangements with pharmaceutical partners, under which we produce and are the exclusive supplier of certain products, devices and/or components. Revenue is recognized when or as control of the goods transfers to the customer as discussed below. We are the exclusive supplier of OTREXUP® to Otter. Because this product is custom manufactured with no alternative use and we have a contractual right to payment for performance completed to date, control is continuously transferred to the customer as the product is produced pursuant to firm purchase orders. Revenue is recognized over time using the output method based on the contractual selling price and number of units produced. The amount of revenue recognized in excess of the amount shipped/billed to the customer, if any, is recorded as contract assets in our condensed consolidated balance sheets due to the short-term nature in which the amount is ultimately expected to be billed and collected from the customer. All other device partnered product sales are recognized at the point in time in which control is transferred to the customer, which is typically upon shipment. Sales terms and pricing are governed by the respective supply and distribution agreements, and there is generally no right of return. Revenue is recognized at the transaction price, which includes the contractual per unit selling price and estimated variable consideration, such as volume-based pricing arrangements or profit-sharing arrangements, if any. We recognize revenue, including the estimated variable consideration we expect to receive for contract margin on future commercial sales, upon shipment of the goods to our partner. The estimated variable consideration is recognized at an amount we believe is not subject to significant reversal of revenue based on historical experience and is adjusted at each reporting period if the most likely amount of expected consideration changes or becomes fixed. Revenue Presentation In our condensed consolidated statements of income, we report the upfront payments, event-based development and regulatory milestones and sales milestones as revenues under collaborative agreements. We also include in this category revenues from separate research and development contracts pursuant to project authorization forms. We report royalties received from partners as a separate line in our condensed consolidated statements of income. Revenues from sales of our proprietary and partnered products are included in product sales, net in our condensed consolidated statements of income. In the footnotes to our condensed consolidated financial statements, we provide disaggregated revenue information by type of arrangement (royalties; product sales, net; and collaborative agreements), and additionally, by type of payment stream received under collaborative agreements (upfront license and target nomination fees; event-based development and regulatory milestones and other fees; sales-based milestones; and device licensing and development revenue). Cost of Sales Cost of sales consists primarily of raw materials, third-party manufacturing costs, fill and finish costs, freight costs, internal costs and manufacturing overhead associated with the production of proprietary and partnered products. Cost of sales also consists of the write-down of excess, dated and obsolete inventories and the write-off of inventories that do not meet certain product specifications, if any. Research and Development Expenses Research and development expenses include salaries and benefits, facilities and other overhead expenses, research related manufacturing services, contract services, and other outside expenses. Research and development expenses are charged to operating expenses as incurred when these expenditures relate to our research and development efforts and have no alternative future uses. We are obligated to make upfront payments upon execution of certain research and development agreements. Advance payments, including nonrefundable amounts, for goods or services that will be used or rendered for future research and development activities are deferred. Such amounts are recognized as expense as the related goods are delivered or the related services are performed or such time when we do not expect the goods to be delivered or services to be performed. Share-Based Compensation We record compensation expense associated with stock options, restricted stock units (“RSUs”), performance stock units (“PSUs”) and shares issued under our employee stock purchase plan (“ESPP”) in accordance with the authoritative guidance for share-based compensation. The cost of employee services received in exchange for an award of an equity instrument is measured at the grant date, based on the estimated fair value of the award, and is recognized as expense on a straight-line basis over the requisite service period of the award. Share-based compensation expense for an award with a performance condition is recognized when the achievement of such performance condition is determined to be probable. If the outcome of such performance condition is not determined to be probable or is not met, no compensation expense is recognized and any previously recognized compensation expense is reversed. Forfeitures are recognized as a reduction of share-based compensation expense as they occur. Income Taxes We provide for income taxes using the liability method. Under this method, deferred income tax assets and liabilities are determined based on the differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases at each reporting period. We measure deferred tax assets and liabilities using enacted tax rates for the year in which the differences are expected to reverse. Significant judgment is required by management to determine our provision for income taxes, our deferred tax assets and liabilities, and any associated valuation allowances recorded against our net deferred tax assets, which are based on complex and evolving tax regulations. Deferred tax assets (“DTA”) and other tax benefits are recorded when they are more likely than not to be realized. On a quarterly basis, we assess the need for valuation allowance on our DTAs, weighing all positive and negative evidence, to assess if it is more-likely-than-not that some or all of our DTAs will be realized. We recorded a provision for income taxes of $19.9 million and $50.9 million using an effective tax rate of 19.9% and 20.6% for the three and nine months ended September 30, 2023, respectively. The difference between our effective tax rate and the U.S. federal statutory rate of 21% is primarily due to state income taxes, tax benefits on the Foreign Derived Intangible Income Deduction (“FDII”), tax detriments on 162(m) and other share-based compensation. Segment Information We operate our business in one operating segment, which includes all activities related to the research, development and commercialization of our proprietary enzymes and devices. This segment also includes revenues and expenses related to (i) research and development and manufacturing activities conducted under our collaborative agreements with third parties, and (ii) product sales of proprietary and partnered products. The chief operating decision-maker reviews the operating results on an aggregate basis and manages the operations as a single operating segment. Adoption and Pending Adoption of Recent Accounting Pronouncements There are no relevant recently issued accounting pronouncements that would materially impact our condensed consolidated financial statements and related disclosures.

v3.23.3

Business Combination	9 Months Ended
	Sep. 30, 2023
Business Combination and Asset Acquisition [Abstract]
Business Combination	Business Combination On May 24, 2022, we acquired all outstanding equity interests of Antares Pharma, Inc. (“Antares”) according to the terms and conditions of the Agreement and Plan of Merger, dated as of April 12, 2022 (the “Merger Agreement”). Antares is a specialty pharmaceutical company focused primarily on the development and commercialization of pharmaceutical products and technologies that address patient needs in targeted therapeutic areas. We acquired Antares as a part of our strategy to expand as a drug delivery company and include specialty products. The total purchase consideration of Antares was $1,045.7 million. Each share of Antares common stock issued and outstanding was converted into the right to receive $5.60 in cash without interest, less any applicable withholding taxes (“Merger Consideration”). The acquisition of Antares has been accounted for using the acquisition method of accounting in accordance with authoritative guidance for business combinations, with Halozyme treated as the accounting acquirer, which requires, among other things, that the assets acquired and liabilities assumed be recognized at their fair value on the acquisition date. The judgments used to determine the estimated fair value assigned to each class of assets acquired and liabilities assumed, as well as asset lives, can materially impact our results of operations. In the first six months of 2023, we recorded measurement period adjustments which increased goodwill by $7.8 million to adjust accrued expenses by $2.0 million, deferred tax liabilities by $5.6 million and accounts receivable by $0.2 million. The measurement period adjustments have been recorded to reflect facts and circumstances that existed as of the acquisition date. During the second quarter of 2023, we finalized the estimates impacting the allocation of purchase price consideration. Unaudited Pro Forma Results Our prior year consolidated financial statements includes Antares’s operations from May 24, 2022 through September 30, 2022. Total revenues and net loss before taxes attributable to Antares and included in our condensed consolidated statements of income for the three months ended September 30, 2022 total $50.4 million and $35.5 million and $69.1 million and $75.3 million for the nine months ended September 30, 2022, respectively. The following unaudited pro forma financial information summarizes combined results of operations of Halozyme and Antares as if the companies had been combined as of the beginning of our fiscal year 2021 (in thousands). Three Months Ended  September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Total revenues $ 216,033  $ 208,976  $ 599,214  $ 531,189  Net income 81,837  66,771  196,206  163,795  The unaudited pro forma financial information for all periods presented includes the business combination accounting effects resulting from this acquisition. The unaudited pro forma results include adjustments to reflect the amortization of the inventory step-up and the incremental intangible asset amortization to be incurred based on preliminary valuations of assets as well as certain material non-recurring transaction adjustments related to the acquisition. Adjustments to interest expense, financing costs and investment income were made to reflect the capital structure of the combined entity. Adjustments to income tax expense were also made to reflect the anticipated effective tax rate of the combined entity. The unaudited pro forma financial information as presented is for informational purposes only and is not necessarily indicative of the results of operations that would have been achieved if the acquisition had taken place at the beginning of fiscal year 2021, nor is it necessarily an indication of trends in future results for a number of reasons, including, but not limited to, differences between the assumptions used to prepare the pro forma information, cost savings from operating efficiencies, potential synergies, and the impact of incremental costs incurred in integrating the businesses.

v3.23.3

Fair Value Measurement	9 Months Ended
	Sep. 30, 2023
Fair Value Disclosures [Abstract]
Fair Value Measurement	Fair Value Measurement Available-for-sale marketable securities consisted of the following (in thousands): September 30, 2023 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Asset-backed securities $ 4,599  $ —  $ (20) $ 4,579  Corporate debt securities 5,976  —  (31) 5,945  U.S. treasury securities 160,034  —  (104) 159,930  Agency bonds 16,020  —  (73) 15,947  Commercial paper 22,655  —  (1) 22,654  Total marketable securities, available-for-sale $ 209,284  $ —  $ (229) $ 209,055  December 31, 2022 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Asset-backed securities $ 1,146  $ —  $ —  $ 1,146  Corporate debt securities 7,139  —  (9) 7,130  U.S. treasury securities 111,469  —  (934) 110,535  Agency bonds 2,783  2  (1) 2,784  Commercial paper 7,004  —  —  7,004  Total marketable securities, available-for-sale $ 129,541  $ 2  $ (944) $ 128,599  As of September 30, 2023, 43 available-for-sale marketable securities with a fair market value of $196.8 million were in a gross unrealized loss position of $0.2 million. Based on our review of these marketable securities, we believe none of the unrealized loss is as a result of a credit loss as of September 30, 2023 because we do not intend to sell these securities and it is not more-likely-than-not that we will be required to sell these securities before the recovery of their amortized cost basis. The estimated fair value of our contractual maturities of available-for-sale debt securities were as follows (in thousands): September 30, 2023 December 31, 2022 Due within one year $ 179,400  $ 114,353  Due after one year but within five years 29,655  14,246  Total estimated fair value of contractual maturities, available-for-sale $ 209,055  $ 128,599  The following table summarizes, by major security type, our cash equivalents and available-for-sale marketable securities measured at fair value on a recurring basis and are categorized using the fair value hierarchy (in thousands): September 30, 2023 December 31, 2022 Level 1 Level 2 Total estimated fair value Level 1 Level 2 Total estimated fair value Assets Cash equivalents Money market funds $ 147,113  $ —  $ 147,113  $ 191,704  $ —  $ 191,704  U.S. treasury securities 23,000  —  23,000  —  —  —  Available-for-sale marketable    securities Asset-backed securities —  4,579  4,579  —  1,146  1,146  Corporate debt securities —  5,945  5,945  —  7,130  7,130  U.S. treasury securities 159,930  —  159,930  110,535  —  110,535  Agency bonds 15,947  —  15,947  2,784  —  2,784  Commercial paper —  22,654  22,654  —  7,004  7,004  Derivative instruments Currency hedging contracts (1) —  2,163  2,163  —  —  —  Total assets $ 345,990  $ 35,341  $ 381,331  $ 305,023  $ 15,280  $ 320,303  Liabilities Derivative instruments Currency hedging contracts (1) $ —  $ 347  347  $ —  $ —  —  (1) Based on observable market transactions of spot currency rates, forward currency rates or equivalently-termed instruments. Carrying amounts of the financial assets and liabilities are equal to the fair value. As of September 30, 2023, the derivative assets and liabilities recorded within prepaid expenses and other current assets, prepaid expense and other assets and other long-term liabilities were $1.6 million, $0.6 million and $0.3 million, respectively. We had no available for sale securities that were classified within Level 3 as of September 30, 2023 and December 31, 2022. A contingent liability was assumed as part of the Antares acquisition related to TLANDO. The acquisition date fair value was measured using the income approach, specifically the probability weighted expected return method for the development milestone payments and the option pricing methodology using the Monte Carlo simulation for commercial milestone payments and royalty payments. Estimates and assumptions used in the Monte Carlo simulation include forecasted revenues, cost of debt, risk free rate, weighted average cost of capital, revenue market price risk and revenue volatility. Estimates and assumptions used in the income approach include the probability of achieving certain milestones and a discount rate. These unobservable inputs represent a Level 3 measurement because they are supported by little or no market activity and reflect our own assumptions in measuring fair value. Changes in the fair value subsequent to the acquisition date will be recognized in our condensed consolidated statements of income. In September 2023, we provided Lipocine notice of termination of the TLANDO license agreement effective January 31, 2024. Based on the fair value remeasurement performed as of September 30, 2023, we recognized a gain on change in fair value of the contingent liability of $13.2 million for the three months ended September 30, 2023 in our condensed consolidated statements of income.

v3.23.3

Revenue	9 Months Ended
	Sep. 30, 2023
Revenue from Contract with Customer [Abstract]
Revenue	Revenue Our disaggregated revenues were as follows (in thousands): Three Months Ended  September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Royalties $ 114,433  $ 99,551  $ 325,813  $ 254,496  Product sales, net   Sales of bulk rHuPH20 37,001  19,259  86,203  60,764  Sale of proprietary products 31,511  24,180  91,765  44,559  Sale of device partnered products 18,057  17,988  43,284  24,544  Total product sales, net $ 86,569  $ 61,427  $ 221,252  $ 129,867  Revenues under collaborative agreements   Upfront license and target nomination fees —  —  —  30,000    Event-based development and regulatory milestone and other fees 13,000  44,000  46,000  59,000    Device licensing and development revenue 2,031  3,998  6,149  5,257  Total revenues under collaborative agreements $ 15,031  $ 47,998  $ 52,149  $ 94,257  Total revenues $ 216,033  $ 208,976  $ 599,214  $ 478,620  During the three months ended September 30, 2023, we recognized revenue related to licenses granted to partners in prior periods in the amount of $127.4 million. This amount represents royalties earned in the current period in addition to $13.0 million of variable consideration in the contracts where uncertainties were resolved and the development milestones are expected to be achieved or were achieved. We also recognized revenue of $0.1 million during the three months ended September 30, 2023 that had been included in deferred revenues in our condensed consolidated balance sheets as of December 31, 2022. During the nine months ended September 30, 2023, we recognized revenue related to licenses granted to partners in prior periods in the amount of $371.8 million. This amount represents royalties earned in the current period in addition to $46.0 million of variable consideration in the contracts where uncertainties were resolved and the development milestones are expected to be achieved or were achieved. We also recognized revenue of $3.2 million during the nine months ended September 30, 2023 that had been included in deferred revenues in our condensed consolidated balance sheets as of December 31, 2022. Accounts receivable, other contract assets and deferred revenues (contract liabilities) from contracts with customers, including partners, consisted of the following (in thousands): September 30, 2023 December 31, 2022 Accounts receivable, net $ 213,987  $ 186,970  Other contract assets 3,338  44,102  Deferred revenues 2,920  5,499  As of September 30, 2023, the amounts included in the transaction price of our contracts with customers, including collaboration partners, and allocated to goods and services not yet provided were $86.1 million, of which $83.2 million relates to unfulfilled product purchase orders and $2.9 million has been collected and is reported as deferred revenues in our condensed consolidated balance sheets. The unfulfilled product purchase orders are estimated to be delivered by the end of 2024. Of the total deferred revenues of $2.9 million, $0.7 million is expected to be used by our customers within the next 12 months. We recognized contract assets of $3.3 million as of September 30, 2023, which related to development milestones deemed probable of receipt for intellectual property licenses granted to partners in prior periods and for goods or services when control has transferred to the customer, and corresponding revenue is recognized on an over time basis but is not yet billable to the customer in accordance with the terms of the contract.

v3.23.3

Certain Balance Sheet Items	9 Months Ended
	Sep. 30, 2023
Balance Sheet Related Disclosures [Abstract]
Certain Balance Sheet Items	Certain Balance Sheet Items Accounts receivable, net and contract assets consisted of the following (in thousands): September 30, 2023 December 31, 2022 Accounts receivable from product sales to partners $ 50,172  $ 62,979  Accounts receivable from revenues under collaborative agreements 17,357  18,776  Accounts receivable from royalty payments 113,632  100,900  Accounts receivable from other product sales 38,758  6,229  Contract assets 3,338  44,102       Total accounts receivable and contract assets 223,257  232,986  Allowance for distribution fees and discounts (5,932) (1,914)      Total accounts receivable, net and contract assets $ 217,325  $ 231,072  Inventories, net consisted of the following (in thousands): September 30, 2023 December 31, 2022 Raw materials $ 26,930  $ 13,792  Work-in-process 37,573  40,361  Finished goods 64,418  45,970       Total inventories, net $ 128,921  $ 100,123  Prepaid expenses and other assets consisted of the following (in thousands): September 30, 2023 December 31, 2022 Prepaid manufacturing expenses $ 47,527  $ 51,694  Other prepaid expenses 7,258  4,647  Other assets 12,808  14,984       Total prepaid expenses and other assets 67,593  71,325  Less: Long-term portion (18,115) (26,301)      Total prepaid expenses and other assets, current $ 49,478  $ 45,024  Prepaid manufacturing expenses include raw materials, slot reservation fees and other amounts paid to contract manufacturing organizations. Such amounts are reclassified to work-in-process inventory as materials are used or the contract manufacturing organization services are complete. Property and equipment, net consisted of the following (in thousands): September 30, 2023 December 31, 2022 Research equipment $ 8,353  $ 7,380  Manufacturing equipment 31,231  27,893  Computer and office equipment 9,117  7,855  Leasehold improvements 6,856  6,729       Subtotal 55,557  49,857  Accumulated depreciation and amortization (18,091) (14,756)      Subtotal 37,466  35,101  Right of use of assets 37,203  40,469       Property and equipment, net $ 74,669  $ 75,570  Depreciation and amortization expense was approximately $2.7 million and $2.0 million, inclusive of ROU asset amortization of $1.4 million and $0.7 million for the three months ended September 30, 2023 and 2022, respectively. Depreciation and amortization expense was approximately $8.2 million and $3.9 million inclusive of ROU asset amortization of $4.2 million and $1.7 million for the nine months ended September 30, 2023 and 2022, respectively. Accrued expenses consisted of the following (in thousands): September 30, 2023 December 31, 2022 Accrued compensation and payroll taxes $ 13,995  $ 19,939  Accrued outsourced manufacturing expenses 13,870  12,190  Income taxes payable 18,029  —  Product returns and sales allowance 36,458  30,261  Other accrued expenses 8,912  29,771  Lease liability 32,358  34,788       Total accrued expenses 123,622  126,949  Less long-term portion (28,422) (30,433)      Total accrued expenses, current $ 95,200  $ 96,516  Expense associated with the accretion of the lease liabilities was approximately $0.6 million and $0.1 million for the three months ended September 30, 2023 and 2022, respectively and $1.9 million and $0.3 million for the nine months ended September 30, 2023 and 2022, respectively. Total lease expense for the three months ended September 30, 2023 and 2022 was $2.0 million and $0.9 million, respectively and $6.1 million and $2.0 million for the nine months ended September 30, 2023 and 2022, respectively. Cash paid for amounts related to leases for the three months ended September 30, 2023 and 2022 was $1.6 million and $1.1 million, respectively and $5.0 million and $2.7 million for the nine months ended September 30, 2023 and 2022, respectively.

v3.23.3

Goodwill and Intangible Assets	9 Months Ended
	Sep. 30, 2023
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill and Intangible Assets	Goodwill and Intangible Assets Goodwill A summary of the activity impacting goodwill is presented below (in thousands): Balance as of December 31, 2022 $ 409,049  Measurement period adjustment (1) 7,772  Balance as of September 30, 2023 $ 416,821  (1) Refer to Note 3, Business Combination, for further discussion on the measurement period adjustment. Intangible Assets Our acquired intangible assets are amortized using the straight-line method over their estimated useful lives of seven to ten years. The following table shows the cost, accumulated amortization and weighted average useful life in years for our acquired intangible assets as of September 30, 2023 (in thousands). Weighted average useful life (in years) Gross Carrying Value Accumulated Amortization Net Carrying Value Auto injector technology platform 7 $ 402,000  $ 77,806  $ 324,194  XYOSTED proprietary product 10 136,200  18,453  117,747  Total finite-lived intangibles, net (1) $ 538,200  $ 96,259  $ 441,941  ATRS-1902 (IPR&D) Indefinite 48,700  Total intangibles, net $ 490,641  (1) An impairment charge of $2.5 million was recognized in the three months ended September 30, 2023 resulting in the full impairment of the TLANDO product rights intangible asset. The impairment charge resulted from the notice of termination of the TLANDO license agreement provided to Lipocine in September 2023, effective January 31, 2024, and is included in amortization of intangibles in our condensed consolidated statements of income. Estimated future annual amortization of finite-lived intangible assets is shown in the following table (in thousands). Actual amortization expense to be reported in future periods could differ from these estimates as a result of acquisitions, divestitures, and asset impairments, among other factors. Year Amortization Expense Remainder of 2023 $ 17,762  2024 71,049  2025 71,049  2026 71,049  2027 71,049  Thereafter 139,983  Total $ 441,941

v3.23.3

Long-Term Debt, Net	9 Months Ended
	Sep. 30, 2023
Debt Disclosure [Abstract]
Long-Term Debt, Net	Long-Term Debt, Net 1.00% Convertible Notes due 2028 In August 2022, we completed the sale of $720.0 million in aggregate principal amount of 1.00% Convertible Senior Notes due 2028 (the “2028 Convertible Notes”). The net proceeds in connection with the issuance of the 2028 Convertible Notes, after deducting the initial purchasers’ fee of $18.0 million, was approximately $702.0 million. We also incurred additional debt issuance costs totaling $1.0 million. Debt issuance costs and the initial purchasers’ fee are presented as a debt discount. The 2028 Convertible Notes pay interest semi-annually in arrears on February 15th and August 15th of each year at an annual rate of 1.00%. The 2028 Convertible Notes are general unsecured obligations and rank senior in right of payment to all indebtedness that is expressly subordinated in right of payment to the 2028 Convertible Notes, rank equally in right of payment with all existing and future liabilities that are not so subordinated, are effectively junior to any secured indebtedness to the extent of the value of the assets securing such indebtedness, and are structurally subordinated to all indebtedness and other liabilities (including trade payables) of our current or future subsidiaries. The 2028 Convertible Notes have a maturity date of August 15, 2028. Holders may convert their 2028 Convertible Notes at their option only in the following circumstances: (1) during any calendar quarter commencing after the calendar quarter ending on December 31, 2022, if the last reported sale price per share of common stock exceeds 130% of the conversion price for each of at least 20 trading days during the 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter; (2) during the five consecutive business days immediately after any five consecutive trading day period (such five consecutive trading day period, the “measurement period”) in which the trading price per $1,000 principal amount of notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price per share of our common stock on such trading day and the conversion rate on such trading day; (3) upon the occurrence of certain corporate events or distributions on our common stock, as described in the offering memorandum for the 2028 Convertible Notes; (4) if we call such notes for redemption; and (5) at any time from, and including, February 15, 2028 until the close of business on the second scheduled trading day immediately before the maturity date. As of September 30, 2023, the 2028 Convertible Notes were not convertible. Upon conversion, we will pay cash for the settlement of principal, and for the premium, if applicable, we will pay cash, deliver shares of common stock or a combination of cash and shares of common stock, at our election. The initial conversion rate for the 2028 Convertible Notes is 17.8517 shares of common stock per $1,000 in principal amount of 2028 Convertible Notes, equivalent to a conversion price of approximately $56.02 per share of our common stock. The conversion rate is subject to adjustment in some events but will not be adjusted for any accrued or unpaid interest. As of September 30, 2023, we were in compliance with all covenants and there was no material adverse change in our business, operations or financial condition. Capped Call Transactions In connection with the offering of the 2028 Convertible Notes, we entered into capped call transactions with certain counterparties (the “Capped Call Transactions”). The Capped Call Transactions are expected generally to reduce potential dilution to holders of our common stock upon conversion of the 2028 Convertible Notes or at our election (subject to certain conditions) offset any cash payments we are required to make in excess of the principal amount of such converted 2028 Convertible Notes. The cap price of the Capped Call Transactions is initially $75.4075 per share of common stock, representing a premium of 75% above the last reported sale price of $43.09 per share of common stock on August 15, 2022, and is subject to certain adjustments under the terms of the Capped Call Transactions. As of September 30, 2023, no capped calls had been exercised. Pursuant to their terms, the capped calls qualify for classification within stockholders’ equity in our condensed consolidated balance sheets, and their fair value is not remeasured and adjusted as long as they continue to qualify for stockholders’ equity classification. We paid approximately $69.1 million for the Capped Calls, including applicable transaction costs, which was recorded as a reduction to additional paid-in capital in our condensed consolidated balance sheets. The Capped Call Transactions are separate transactions entered into by us with the capped call Counterparties, are not part of the terms of the Convertible Notes, and do not affect any holder’s rights under the Convertible Notes. Holders of the Convertible Notes do not have any rights with respect to the Capped Call Transactions. 0.25% Convertible Notes due 2027 In March 2021, we completed the sale of $805.0 million in aggregate principal amount of 0.25% Convertible Senior Notes due 2027 (the “2027 Convertible Notes”). The net proceeds in connection with the issuance of the 2027 Convertible Notes, after deducting the initial purchasers’ fee of $20.1 million, was approximately $784.9 million. We also incurred additional debt issuance costs totaling $0.4 million. Debt issuance costs and the initial purchasers’ fee are presented as a debt discount. The 2027 Convertible Notes pay interest semi-annually in arrears on March 1st and September 1st of each year at an annual rate of 0.25%. The 2027 Convertible Notes are general unsecured obligations and will rank senior in right of payment to all indebtedness that is expressly subordinated in right of payment to the 2027 Convertible Notes, will rank equally in right of payment with all existing and future liabilities that are not so subordinated, will be effectively junior to any secured indebtedness to the extent of the value of the assets securing such indebtedness and will be structurally subordinated to all indebtedness and other liabilities (including trade payables) of our current or future subsidiaries. The 2027 Convertible Notes have a maturity date of March 1, 2027. Holders may convert their 2027 Convertible Notes at their option only in the following circumstances: (1) during any calendar quarter commencing after the calendar quarter ending on June 30, 2021, if the last reported sale price per share of common stock exceeds 130% of the conversion price for each of at least 20 trading days during the 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter; (2) during the five consecutive business days immediately after any five consecutive trading day period (such five consecutive trading day period, the “measurement period”) in which the trading price per $1,000 principal amount of notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price per share of our common stock on such trading day and the conversion rate on such trading day; (3) upon the occurrence of certain corporate events or distributions on our common stock, as described in the offering memorandum for the 2027 Convertible Notes; (4) if we call such notes for redemption; and (5) at any time from, and including, September 1, 2026 until the close of business on the scheduled trading day immediately before the maturity date. As of September 30, 2023, the 2027 Convertible Notes were not convertible. Upon conversion, we will pay cash for the settlement of principal, and for the premium, if applicable, we will pay cash, deliver shares of common stock or a combination of cash and shares of common stock, at our election. The initial conversion rate for the 2027 Convertible Notes will be 12.9576 shares of common stock per $1,000 in principal amount of 2027 Convertible Notes, equivalent to a conversion price of approximately $77.17 per share of our common stock. The conversion rate is subject to adjustment. As of September 30, 2023, we were in compliance with all covenants and there was no material adverse change in our business, operations or financial condition. 1.25% Convertible Notes due 2024 In November 2019, we completed the sale of $460.0 million in aggregate principal amount of 1.25% Convertible Senior Notes due 2024 (the “2024 Convertible Notes”). The net proceeds in connection with the issuance of the 2024 Convertible Notes, after deducting the initial purchases’ fee of $12.7 million, was approximately $447.3 million. We also incurred debt issuance cost totaling $0.3 million. Debt issuance costs and the initial purchasers’ fee are presented as a debt discount. The 2024 Convertible Notes pay interest semi-annually in arrears on June 1st and December 1st of each year, beginning on June 1, 2020, at an annual rate of 1.25%. The 2024 Convertible Notes are general unsecured obligations and will rank senior in right of payment to all indebtedness that is expressly subordinated in right of payment to the 2024 Convertible Notes, will rank equally in right of payment with all existing and future liabilities that are not so subordinated, will be effectively junior to any secured indebtedness to the extent of the value of the assets securing such indebtedness and will be structurally subordinated to all indebtedness and other liabilities (including trade payables) of our current or future subsidiaries. The 2024 Convertible Notes have a maturity date of December 1, 2024. Holders may convert their 2024 Convertible Notes at their option only in the following circumstances: (1) during any calendar quarter commencing after the calendar quarter ending on March 31, 2020, if the last reported sale price per share of common stock exceeds 130% of the conversion price for each of at least 20 trading days during the 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter; (2) during the five consecutive business days immediately after any five consecutive trading day period (such five consecutive trading day period, the “measurement period”) in which the trading price per $1,000 principal amount of notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price per share of our common stock on such trading day and the conversion rate on such trading day; (3) upon the occurrence of certain corporate events or distributions on our common stock, as described in the offering memorandum for the 2024 Convertible Notes; (4) if we call such notes for redemption; and (5) at any time from, and including, June 1, 2024 until the close of business on the scheduled trading day immediately before the maturity date. In January 2021, we notified the note holders of our irrevocable election to settle the principal of the 2024 Convertible Notes in cash and for the premium, if applicable, to deliver shares of common stock. The conversion rate for the 2024 Convertible Notes was 41.9208 shares of common stock per $1,000 in principal amount of 2024 Convertible Notes, equivalent to a conversion price of approximately $23.85 per share of our common stock. The conversion rate was subject to adjustment. In March 2021, we completed a privately negotiated induced conversion of $369.1 million principal amount of the 2024 Convertible Notes (“2021 Note Repurchases” or the “2021 Induced Conversion”). In connection with the 2021 Induced Conversion, we paid approximately $370.2 million in cash, which includes principal and accrued interest, and issued approximately 9.08 million shares of our common stock representing the intrinsic value based on the contractual conversion rate and incremental shares as an inducement for conversion. As a result of the 2021 Induced Conversion, we recorded $21.0 million in induced conversion expense which was included in other income (expense) of our condensed consolidated statements of income in 2021. The induced conversion expense represented the fair value of the common stock issued upon conversion in excess of the common stock issuable under the original terms of the 2024 Convertible Notes. In August 2022, we completed a privately negotiated induced conversion of $77.4 million principal amount of the 2024 Convertible Notes (“2022 Note Repurchases” or the “2022 Induced Conversion”). In connection with the 2022 Induced Conversion, we paid approximately $77.6 million in cash, which includes principal and accrued interest, and issued approximately 1.51 million shares of our common stock representing the intrinsic value based on the contractual conversion rate and incremental shares as an inducement for conversion. As a result of the 2022 Induced Conversion, we recorded $2.7 million in induced conversion expense which was included in other income (expense) of our condensed consolidated statements of income in 2022. The induced conversion expense represented the fair value of the common stock issued upon conversion in excess of the common stock issuable under the original terms of the 2024 Convertible Notes. In January 2023, we issued a notice for the redemption of 2024 Convertible Notes. Holders of the notes could convert their notes at any time prior the close of business day prior to the redemption date. In March 2023, holders of the notes elected to convert the 2024 Convertible Notes in full. In connection with the conversion, we paid approximately $13.5 million in cash which includes principal and accrued interest, and issued 288,886 shares of our common stock representing the intrinsic value based on the contractual conversion rate. Net Carrying Amounts of our Convertible Notes The carrying amount and fair value of our Convertible Notes were as follows (in thousands). September 30, 2023 December 31, 2022 Principal amount 2024 Convertible Notes $ —  $ 13,483  2027 Convertible Notes 805,000  805,000  2028 Convertible Notes 720,000  720,000  Total principal amount $ 1,525,000  $ 1,538,483  Unamortized debt discount 2024 Convertible Notes $ —  $ (149) 2027 Convertible Notes (11,805) (14,359) 2028 Convertible Notes (15,574) (17,875) Total unamortized debt discount $ (27,379) $ (32,383) Carrying amount 2024 Convertible Notes $ —  $ 13,334  2027 Convertible Notes 793,195  790,641  2028 Convertible Notes 704,426  702,125  Total carrying amount $ 1,497,621  $ 1,506,100  Fair value based on trading levels (Level 2): 2024 Convertible Notes $ —  $ 32,176  2027 Convertible Notes 681,835  784,770  2028 Convertible Notes 674,892  849,823  Total fair value of outstanding notes $ 1,356,727  $ 1,666,769  Remaining amortization per period of debt discount (in years): 2024 Convertible Notes —  1.9 2027 Convertible Notes 3.4 4.2 2028 Convertible Notes 4.9 5.6 The following table summarizes the components of interest expense and the effective interest rates for each of our Convertible Notes (in thousands). Three Months Ended  September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Coupon interest 2024 Convertible Notes $ —  $ 161  $ 36  $ 729  2027 Convertible Notes 503  503  1,509  1,509  2028 Convertible Notes 1,800  860  5,400  860  Total coupon interest $ 2,303  $ 1,524  $ 6,945  $ 3,098  Amortization of debt discount 2024 Convertible Notes $ —  $ 84  $ 24  $ 338  2027 Convertible Notes 853  847  2,555  2,537  2028 Convertible Notes 770  363  2,301  363  Total amortization of debt discount $ 1,623  $ 1,294  $ 4,880  $ 3,238  Interest expense 2024 Convertible Notes $ —  $ 245  $ 60  $ 1,067  2027 Convertible Notes 1,356  1,350  4,064  4,046  2028 Convertible Notes 2,570  1,223  7,701  1,223  Total interest expense $ 3,926  $ 2,818  $ 11,825  $ 6,336  Effective interest rates 2024 Convertible Notes —  1.8  % —  1.8  % 2027 Convertible Notes 0.7  % 0.7  % 0.7  % 0.7  % 2028 Convertible Notes 1.5  % 1.5  % 1.5  % 1.5  % Revolving Credit and Term Loan Facilities (May 2022) In May 2022, in connection with the closing of the Antares acquisition, we entered into a credit agreement, which was subsequently amended, with Bank of America, N.A., as Administrative Agent, Swing Line Lender and an L/C Issuer, and the other lenders and L/C Issuers party thereto (the “2022 Credit Agreement), evidencing a credit facility (the “2022 Facility”) that provides for (i) a $350 million revolving credit facility (the “Revolving Credit Facility”) and (ii) a $250 million term loan facility (the “Term Facility”). Proceeds from a $120 million draw on the Revolving Credit Facility and the $250 million Term Facility were used to fund a portion of the Antares acquisition, repay Antares’ existing debt and pay fees and expenses in connection with the Antares acquisition. The 2022 Credit Agreement contains an expansion feature, which allows us, subject to certain conditions, to increase the aggregate principal amount of the 2022 Facility, provided we remain in compliance with underlying financial covenants on a pro forma basis including the consolidated interest coverage ratio and the consolidated net leverage ratio covenants set forth in the 2022 Credit Agreement. The 2022 Facility will mature on November 30, 2026 unless either the Revolving Credit Facility or the Term Facility is extended prior to such date in accordance with the 2022 Credit Agreement. The Term Facility requires quarterly scheduled repayments of the term loans in each of the first, second, third and fourth years following the closing in annual amounts equal to 2.50%, 5.00%, 7.50% and 10.00% of the initial principal amount of the term loans, respectively. The term loans are also subject to mandatory prepayments from the proceeds of certain asset sales, subject to our right to reinvest the proceeds thereof. Borrowings under the 2022 Facility bear interest, at our option, at a rate equal to an applicable margin plus: (a) the applicable Term Secured Overnight Financing Rate (“SOFR”) (which includes a SOFR adjustment of 0.10%), or (b) a base rate determined by reference to the highest of (1) the federal funds effective rate plus 0.50%, (2) the Bank of America prime rate, (3) the Term SOFR rate for an interest period of one month plus 1.10%, and (4) 1.00%. The margin for the 2022 Facility ranges, based on our consolidated total net leverage ratio, from 0.25% to 1.25% in the case of base rate loans and from 1.25% to 2.25% in the case of Term SOFR rate loans. In addition to paying interest on the outstanding principal under the Facility, we will pay (i) a commitment fee in respect of the unutilized commitments thereunder and (ii) customary letter of credit fees and agency fees. The commitment fees range from 0.15% to 0.35% per annum based on our consolidated net leverage ratio. In August 2022, we entered into Amendment No. 1 to the Credit Agreement (the “Amendment”) among the Company, the Guarantors (as defined in the Credit Agreement), each L/C Issuer from time to time party thereto, Bank of America, N.A., as Administrative Agent (in such capacity, the “Administrative Agent”) and swing line lender (in such capacity, the “Swing Line Lender”), and each lender party thereto, which amends the Credit Agreement dated as of May 24, 2022 (the “Credit Agreement”) among the Company, the Guarantors, the Administrative Agent, the Swing Line Lender, each Lender and the L/C Issuers. The Amendment, among other things, increased the size of the revolving credit facility from $350 million to $575 million. The terms of the Revolving Credit Facility were otherwise unchanged. Concurrently, with the entry into the Amendment, we repaid the entire outstanding Term Loan Facility and repaid all outstanding loans under the Revolving Credit Facility under the 2022 Credit Agreement. As of September 30, 2023, the Revolving Credit Facility was undrawn. We incurred a total of $3.6 million in third-party costs related to the 2022 Credit Agreement which are recorded as debt issuance cost within prepaid expenses and other assets in our condensed consolidated balance sheets. As of September 30, 2023, the unamortized debt issuance cost related to the revolving credit facility was $2.5 million.

v3.23.3

Share-based Compensation	9 Months Ended
	Sep. 30, 2023
Share-Based Payment Arrangement, Noncash Expense [Abstract]
Share-based Compensation	Share-based Compensation The following table summarized share-based compensation expense included in our condensed consolidated statements of income related to share-based awards (in thousands): Three Months Ended  September 30, Nine Months Ended September 30,   2023 2022 2023 2022 Research and development $ 3,159  $ 2,695  $ 9,931  $ 7,168  Selling, general and administrative 6,208  4,102  17,025  10,006  Total share-based compensation expense $ 9,367  $ 6,797  $ 26,956  $ 17,174  Share-based compensation expense by type of share-based award (in thousands): Three Months Ended  September 30, Nine Months Ended September 30,   2023 2022 2023 2022 Stock options $ 4,290  $ 2,801  $ 11,935  $ 7,924  RSUs, PSUs and ESPP 5,077  3,996  15,021  9,250  Total share-based compensation expense $ 9,367  $ 6,797  $ 26,956  $ 17,174  We granted stock options to purchase approximately 0.2 million and 0.1 million shares of common stock during the three months ended September 30, 2023 and 2022, respectively and 1.8 million and 1.6 million shares of common stock during the nine months ended September 30, 2023 and 2022, respectively. The exercise price of stock options granted is equal to the closing price of the common stock on the date of grant. The fair value of each option award is estimated on the date of grant using the Black-Scholes-Merton option pricing model (“Black-Scholes model”). Expected volatility is based on historical volatility of our common stock. The expected term of options granted is based on analyses of historical employee termination rates and option exercises. The risk-free interest rate is based on the U.S. Treasury yield for a period consistent with the expected term of the option in effect at the time of the grant. The dividend yield assumption is based on the expectation of no future dividend payments. The assumptions used in the Black-Scholes model were as follows: Three Months Ended  September 30, Nine Months Ended September 30,   2023 2022 2023 2022 Expected volatility 40.70 - 40.82% 40.37 - 50.80% 39.68-40.82% 40.37-50.80% Average expected term (in years) 4.9 4.7 4.8 4.7 Risk-free interest rate 4.19 - 4.29% 2.66 - 3.39% 3.37-4.29% 1.37-3.39% Expected dividend yield —  —  —  —  In February 2021, our Board of Directors approved our 2021 ESPP and our stockholders approved the plan in May 2021. The ESPP enables eligible employees to purchase shares of our common stock at the end of each offering period at a price equal to 85% of the fair market value of the shares on the first business day or the last business day of the offering period, whichever is lower. Share purchases are funded through payroll deduction of at least 1% and up to 15% of an employee’s compensation for each payroll period, and no employee may purchase shares under the ESPP that exceeds $25,000 worth of our common stock for a calendar year. As of September 30, 2023, 2,630,346 shares were available for future purchase. The offering period is generally for a six-month period and the first offering period commenced on June 16, 2021. Offering periods shall commence on or about the sixteenth day of June and December of each year and end on or about the fifteenth day of the next December and June, respectively, occurring thereafter. During the nine months ended September 30, 2023, 19,757 shares were issued pursuant to the ESPP. Total unrecognized estimated compensation cost by type of award and the weighted-average remaining requisite service period over which such expense is expected to be recognized was as follows (in thousands, unless otherwise noted): September 30, 2023   Unrecognized Expense Remaining Weighted-Average Recognition Period (years) Stock options $ 41,893  2.75 RSUs 36,721  2.51 PSUs 7,153  1.68 ESPP 110  0.21

v3.23.3

Stockholders' Equity	9 Months Ended
	Sep. 30, 2023
Equity [Abstract]
Stockholders' Equity	Stockholders’ Equity During the nine months ended September 30, 2023 and 2022, we issued an aggregate of 455,702 and 483,385 shares of common stock, respectively, in connection with the exercises of stock options at a weighted average exercise price of $18.10 and $18.45 per share, respectively, for net proceeds of approximately $8.2 million and $8.9 million, respectively. For the nine months ended September 30, 2023 and 2022, we issued 328,115 and 252,063 shares of common stock, respectively, upon vesting of certain RSUs and PSUs for which 70,733 and 68,425 RSUs were withheld from the RSU holders, respectively, to pay for minimum withholding taxes totaling approximately $7.2 million and $4.3 million, respectively. Stock options and unvested restricted units totaling approximately 7.7 million and 6.6 million shares of our common stock were outstanding as of September 30, 2023 and December 31, 2022, respectively. Share Repurchases In December 2021, the Board of Directors authorized a capital return program to repurchase up to $750.0 million of outstanding stock over a three-year period. During 2021, we repurchased 3.9 million shares of common stock for $150.0 million at an average price of $38.51. During 2022, we repurchased 4.5 million shares of common stock for $200.0 million at an average price of $44.44. All shares repurchased under our capital return programs have been retired and have resumed their status of authorized and unissued shares. As of September 30, 2023, we have repurchased a total of 12.6 million shares for $500.0 million at an average price per share of $39.81 under our $750 million 3-year share repurchase plan. As of September 30, 2023, $250.0 million of outstanding stock is available to be purchased under the program. We had the following activity under the approved share repurchase programs (dollars in thousands, except share and per share data): 2023 Total Number of Shares Purchased Weighted Average Price Paid Per Share Total Cost(1) First quarter 4,165,258  $ 36.01  $ 150,083  Second quarter —  —  —  Third quarter —  —  —  4,165,258  $ 36.01  $ 150,083  (1) Included in the total cost of shares purchased is a commission fee of $0.02 per share.

v3.23.3

Earnings per share	9 Months Ended
	Sep. 30, 2023
Earnings Per Share [Abstract]
Earnings per share	Earnings per share Basic earnings per common share is computed by dividing net income for the period by the weighted average number of common shares outstanding during the period, without consideration for common stock equivalents. Outstanding stock options, unvested RSUs, unvested PSUs, common shares expected to be issued under our ESPP and the Convertible Notes are considered common stock equivalents and are only included in the calculation of diluted earnings per common share when net income is reported and their effect is dilutive. Potentially dilutive common shares issuable upon vesting of stock options, RSUs and PSUs are determined using the average share price for each period under the treasury stock method. Potentially dilutive common shares issuable upon conversion of our Convertible Notes are determined using the if-converted method. Since we have committed to settle the principal amount of the Convertible Notes in cash upon conversion only, the number of shares for the conversion spread will be included as a dilutive common stock equivalent. A reconciliation of the numerators and the denominators of the basic and diluted earnings per common share computations is as follows (in thousands, except per share amounts): Three Months Ended  September 30, Nine Months Ended September 30,   2023 2022 2023 2022 Numerator Net income $ 81,837  $ 61,634  $ 196,206  $ 144,427  Denominator Weighted average common shares outstanding for basic earnings per share 131,965  136,527  132,896  137,370  Dilutive potential common stock outstanding Stock options 1,830  2,237  1,882  2,211  RSUs, PSUs and ESPP 288  363  378  362  Convertible Notes —  260  77  1,076  Weighted average common shares outstanding for diluted earnings per share 134,083  139,387  135,233  141,019  Earnings per share Basic $ 0.62  $ 0.45  $ 1.48  $ 1.05  Diluted $ 0.61  $ 0.44  $ 1.45  $ 1.02  Shares which have been excluded from the calculation of diluted earnings per common share because their effect was anti-dilutive include the following (shares in millions): Three Months Ended  September 30, Nine Months Ended September 30,   2023 2022 2023 2022 Anti-dilutive securities (1) 27.4  25.6  27.6  19.0  (1) The anti-dilutive securities include outstanding stock options, unvested RSUs, unvested PSUs, common shares expected to be issued under our ESPP and Convertible Notes

v3.23.3

Commitments and Contingencies	9 Months Ended
	Sep. 30, 2023
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and ContingenciesFrom time to time, we may be involved in disputes, including litigation, relating to claims arising out of operations in the normal course of our business. Any of these claims could subject us to costly legal expenses and, while we generally believe that we have adequate insurance to cover many different types of liabilities, our insurance carriers may deny coverage or our policy limits may be inadequate to fully satisfy any damage awards or settlements. If this were to happen, the payment of any such awards could have a material adverse effect on our condensed consolidated statements of income and balance sheets. Additionally, any such claims, whether or not successful, could damage our reputation and business. We currently are not a party to any legal proceedings, the adverse outcome of which, in our opinion, individually or in the aggregate, would have a material adverse effect on our condensed consolidated statements of income or balance sheets.

v3.23.3

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Pay vs Performance Disclosure
Net Income (Loss) Attributable to Parent	$ 81,837	$ 61,634	$ 196,206	$ 144,427

v3.23.3

Insider Trading Arrangements	3 Months Ended
	Sep. 30, 2023
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

v3.23.3

Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2023
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation The accompanying interim unaudited condensed consolidated financial statements have been prepared for purposes of and in accordance with United States generally accepted accounting principles (“U.S. GAAP”) and with the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) related to a quarterly report on Form 10-Q. Accordingly, they do not include all of the information and disclosures required by U.S. GAAP for a complete set of financial statements. These interim unaudited condensed consolidated financial statements and notes thereto should be read in conjunction with the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on February 21, 2023. The unaudited financial information for the interim periods presented herein reflects all adjustments which, in the opinion of management, are necessary for a fair presentation of the financial condition and results of operations for the periods presented, with such adjustments consisting only of normal recurring adjustments. Operating results for interim periods are not necessarily indicative of the operating results for an entire fiscal year.
Consolidation	The accompanying interim unaudited condensed consolidated financial statements include the accounts of Halozyme Therapeutics, Inc. and our wholly owned subsidiaries, Halozyme, Inc. and Antares Pharma, Inc., and Antares Pharma, Inc.’s wholly owned Swiss subsidiaries, Antares Pharma IPL AG and Antares Pharma AG. All intercompany accounts and transactions have been eliminated.
Use of Estimates	Use of EstimatesThe preparation of interim unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires us to make estimates and assumptions that affect the amounts reported in our interim unaudited condensed consolidated financial statements and accompanying notes. On an ongoing basis, we evaluate our estimates and judgments, which are based on historical and anticipated results and trends and on various other assumptions that we believe to be reasonable under the circumstances. By their nature, estimates are subject to an inherent degree of uncertainty and, as such, actual results may differ from our estimates
Cash Equivalents	Cash equivalents consist of highly liquid investments, readily convertible to cash, that mature within 90 days or less from the date of purchase. As of September 30, 2023, our cash and cash equivalents consisted of money market funds, bank certificate of deposits, U.S. treasury securities and demand deposits at commercial banks.
Marketable Securities	Marketable securities are investments with original maturities of more than 90 days from the date of purchase that are specifically identified to fund current operations. Marketable securities are considered available-for-sale. These investments are classified as current assets, even though the stated maturity date may be one year or more beyond the current balance sheet date which reflects management’s intention to use the proceeds from the sale of these investments to fund our operations, as necessary. Such available-for-sale investments are carried at fair value with unrealized gains and losses recorded in other comprehensive income (loss) and included as a separate component of stockholders’ equity. The cost of marketable securities is adjusted for amortization of premiums or accretion of discounts to maturity, and such amortization or accretion is included in investment and other income, net in our condensed consolidated statements of income. We use the specific identification method for calculating realized gains and losses on marketable securities sold. None of the realized gains and losses and declines in value that were judged to be as a result of credit loss on marketable securities, if any, are included in investment and other income, net in our condensed consolidated statements of income.
Restricted Cash	Restricted Cash Under the lease terms of our facilities, we may be required to maintain letters of credit as security deposits during the terms of such leases. As of September 30, 2023, no restricted cash remained pledged as collateral for the letters of credit as the associated lease was terminated. As of December 31, 2022, restricted cash of $0.5 million was pledged as collateral for the letters of credit.
Fair Value of Financial Instruments	Fair Value of Financial Instruments The authoritative guidance for fair value measurements establishes a three tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include: Level 1, defined as observable inputs such as quoted prices in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions. Our financial instruments include cash equivalents, available-for-sale marketable securities, accounts receivable, prepaid expenses and other assets, accounts payable, accrued expenses and long-term debt. Fair value estimates of these instruments are made at a specific point in time based on relevant market information. These estimates may be subjective in nature and involve uncertainties and matters of significant judgment and therefore, cannot be determined with precision. The carrying amount of cash equivalents, accounts receivable, prepaid expenses and other assets, accounts payable and accrued expenses are generally considered to be representative of their respective fair values because of the short-term nature of those instruments. Available-for-sale marketable securities consist of asset-backed securities, corporate debt securities, U.S. Treasury securities, agency bonds and commercial paper, and are measured at fair value using Level 1 and Level 2 inputs. Level 2 financial instruments are valued using market prices on less active markets and proprietary pricing valuation models with observable inputs, including interest rates, yield curves, maturity dates, issue dates, settlement dates, reported trades, broker-dealer quotes, issue spreads, benchmark securities or other market related data. We obtain the fair value of Level 2 investments from our investment manager, who obtains these fair values from a third-party pricing source. We validate the fair values of Level 2 financial instruments provided by our investment manager by comparing these fair values to a third-party pricing source.
Inventories	Inventories Inventories are stated at lower of cost or net realizable value. Cost is determined on a first-in, first-out basis. Net realizable value is the estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. Inventories are reviewed periodically for potential excess, dated or obsolete status. We evaluate the carrying value of inventories on a regular basis, taking into account such factors as historical and anticipated future sales compared to quantities on hand, the price we expect to obtain for products in their respective markets compared with historical cost and the remaining shelf life of goods on hand.
Leases	Leases We have entered into operating leases primarily for real estate and automobiles. These leases have contractual terms which range from three years to 12 years. We determine if an arrangement contains a lease at inception. Right of use (“ROU”) assets and liabilities resulting from operating leases are included in property and equipment, accrued expenses and other long-term liabilities on our condensed consolidated balance sheets. Operating lease ROU assets and liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the discount rate to calculate the present value of future payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. Our leases often include options to extend or terminate the lease. These options are included in the lease term when it is reasonably certain that we will exercise that option. Short-term leases with an initial term of 12 months or less are not recorded on our condensed consolidated balance sheets. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. We have lease agreements with lease and non-lease components, which are generally accounted for separately. For certain equipment leases, such as automobiles, we account for the lease and non-lease components as a single lease component.
Convertible Notes	Convertible Notes The 2024 Convertible Notes, the 2027 Convertible Notes and the 2028 Convertible Notes (collectively, the “Convertible Notes”) are accounted for in accordance with authoritative guidance for debt and derivatives. We evaluate all the embedded conversion options contained in the Convertible Notes to determine if there are embedded features that require bifurcation as a derivative as required by U.S. GAAP. Based on our analysis, we account for each of our Convertible Notes as single units of accounting, a liability, because we concluded that the conversion features do not require bifurcation as a derivative under embedded derivative authoritative guidance.
Cash Flow Hedges	Cash Flow Hedges - Currency Risks Beginning in the second quarter of 2023, we entered into a cash flow hedging program to mitigate foreign currency exchange risk associated with forecasted royalty revenue denominated in Swiss francs. Under the program, we can hedge these forecasted royalties up to a maximum of four years into the future. We hedge these cash flow exposures to reduce the risk of our earnings and cash flows being adversely affected by fluctuations in exchange rates. In accordance with the hedge accounting treatment, all hedging relationships are formally documented at the inception of the hedge and are highly effective in offsetting changes to future cash flows on hedged transactions. Both at inception of the hedge and on an ongoing basis, we assess whether the foreign currency forward contracts are highly effective in offsetting changes in cash flows of hedged items on a prospective and retrospective basis. If we determine a (i) foreign currency forward contract is not highly effective as a cash flow hedge, (ii) foreign currency forward contract has ceased to be a highly effective hedge or (iii) forecasted transaction is no longer probable of occurring, we would discontinue hedge accounting treatment prospectively. We measure effectiveness based on the change in fair value of the forward currency forward contract and the fair value of the hypothetical foreign currency forward contract with terms that match the critical terms of the risk being hedged. No portion of our foreign currency forward contracts were excluded from the assessment of hedge effectiveness. As of September 30, 2023, all hedges were determined to be highly effective. The assets or liabilities associated with our hedging contracts are recorded at fair market value in prepaid expense and other current assets, accrued expenses, or other long-term liabilities, respectively, in our condensed consolidated balance sheets. Gains and losses related to changes in the fair market value of these hedging contracts are recorded as a component of accumulated other comprehensive income (loss) (“AOCI”) within stockholder’s equity in our condensed consolidated balance sheets and reclassified to royalty revenue in our condensed consolidated statements of income in the same period as the recognition of the underlying hedged transaction. In the event the underlying forecasted transaction does not occur, or it becomes probable that it will not occur, within the defined hedge period, we reclassify the gains or losses on the related cash flow hedge from AOCI to royalties revenue in our condensed consolidated statements of income. Since the fair market value of these hedging contracts is derived from current market rates, the hedging contracts are classified as derivative financial instruments. We do not use derivatives for speculative or trading purposes. As of September 30, 2023, amounts expected to be recognized as a net gain out of AOCI into our condensed consolidated statements of income during the next 12 months, are not material.
Business Combinations	Business Combinations Under the acquisition method of accounting, we allocate the fair value of the total consideration transferred to the tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values on the date of acquisition. These valuations require us to make estimates and assumptions, especially with respect to intangible assets. We record the excess consideration over the aggregate fair value of tangible and intangible assets, net of liabilities assumed, as goodwill. Costs incurred to complete a business combination, such as legal and other professional fees, are expensed as incurred. If the initial accounting for a business combination is incomplete by the end of a reporting period that falls within the measurement period, we report provisional amounts in our financial statements. During the measurement period, we adjust the provisional amounts recognized at the acquisition date to reflect new information obtained about facts and circumstances that existed as of the acquisition date that, if known, would have affected the measurement of the amounts recognized as of that date. We record these adjustments to the provisional amounts with a corresponding offset to goodwill. Any adjustments identified after the measurement period are recorded in our condensed consolidated statements of income.
Goodwill and Intangible Assets	Assets acquired, including intangible assets and in-process research and development (“IPR&D”), and liabilities assumed are measured at fair value as of the acquisition date. Goodwill, which has an indefinite useful life, represents the excess of cost over fair value of the net assets acquired. Intangible assets acquired in a business combination that are used for IPR&D activities are considered indefinite lived until the completion or abandonment of the associated research and development efforts. Upon reaching the end of the relevant research and development project (i.e., upon commercialization), the IPR&D asset is amortized over its estimated useful life. If the relevant research and development project is abandoned, the IPR&D asset is expensed in the period of abandonment. Goodwill and IPR&D are not amortized; however, they are reviewed for impairment at least annually during the second quarter, or more frequently if an event occurs indicating the potential for impairment. Goodwill and IPR&D are considered to be impaired if the carrying value of the reporting unit or IPR&D asset exceeds its respective fair value. We perform our goodwill impairment analysis at the reporting unit level, which aligns with our reporting and operating segment structure and availability of discrete financial information. During the goodwill impairment review, we assess qualitative factors to determine whether it is more likely than not that the fair values of our reporting unit is less than the carrying amount, including goodwill. The qualitative factors include, but are not limited to, macroeconomic conditions, industry and market considerations, and our overall financial performance. If, after assessing the totality of these qualitative factors, we determine that it is not more likely than not that the fair value of our reporting unit is less than the carrying amounts, then no additional assessment is deemed necessary. Otherwise, we proceed to compare the estimated fair value of the reporting unit with the carrying value, including goodwill. If the carrying amount of the reporting unit exceeds the fair value, we record an impairment loss based on the difference. We may elect to bypass the qualitative assessment in a period and proceed to perform the quantitative goodwill impairment test. Our identifiable intangible assets with finite useful lives are typically comprised of acquired device technologies and product rights. The cost of identifiable intangible assets with finite lives is generally amortized on a straight-line basis over the assets’ respective estimated useful lives.
Intangible Assets and Other Long-Lived Assets	We perform regular reviews to determine if any event has occurred that may indicate intangible assets with finite useful lives and other long-lived assets are potentially impaired. If indicators of impairment exist, an impairment test is performed to assess the recoverability of the affected assets by determining whether the carrying amount of such assets exceeds the undiscounted expected future cash flows. If the affected assets are not recoverable, we estimate the fair value of the assets and record an impairment loss if the carrying value of the assets exceeds the fair value. Factors that may indicate potential impairment include a significant decline in our stock price and market capitalization compared to the net book value, significant changes in the ability of a particular asset to generate positive cash flows for our strategic business objectives, and the pattern of utilization of a particular asset.
Revenue Recognition and Cost of Product Sales	Revenue Recognition We generate revenues from payments received (i) as royalties from licensing our ENHANZE technology and other royalty arrangements, (ii) under collaborative agreements and (iii) from sales of our proprietary and partnered products. We recognize revenue when we transfer promised goods or services to customers in an amount that reflects the consideration to which we expect to be entitled in exchange for those goods or services. To determine revenue recognition for contracts with customers, we perform the following five steps: (i) identify the promised goods or services in the contract; (ii) identify the performance obligations in the contract, including whether they are distinct in the context of the contract; (iii) determine the transaction price, including the constraint on variable consideration; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) we satisfy the performance obligations. ENHANZE and Device Royalties Under the terms of our ENHANZE collaboration and license agreements, our partners will pay us royalties at an on average mid-single digit percent rate of their sales if products under the collaboration are commercialized. All amounts owed to us are noncancelable after the underlying triggering event occurs, and nonrefundable once paid. Unless terminated earlier in accordance with its terms, collaborations generally continue in effect until the last to expire royalty payment term, as determined on a product by product and country by country basis, with each royalty term starting on the first commercial sale of that product and ending the later of: (i) a specified period or term set forth in the agreement or (ii) expiration of the last to expire of the valid claims of our patents covering rHuPH20 or other specified patents developed under the collaboration which valid claim covers a product developed under the collaboration. In general, when there are no valid claims of a specified patent developed under the collaboration covering the product in a given country, the royalty rate is reduced for those sales in that country upon the expiration of our patents covering rHuPH20. Janssen’s patents covering DARZALEX SC do not impact the timing for this royalty reduction. Partners may terminate the agreement prior to expiration for any reason in its entirety or on a target-by-target basis generally upon 90 days prior written notice to us. Upon any such termination, the license granted to partners (in total or with respect to the terminated target, as applicable) will terminate provided; however, that in the event of expiration of the agreement (as opposed to a termination), the on-going licenses granted will become perpetual, non-exclusive and fully paid. Sales-based milestones and royalties are recognized in the period the underlying sales or milestones occur. We do not receive final royalty reports from our ENHANZE partners until after we complete our financial statements for a prior quarter. Therefore, we recognize revenue based on estimates of the royalty earned, which are based on internal estimates and available preliminary reports provided by our partners. We will record adjustments in the following quarter, if necessary, when final royalty reports are received. To date, we have not recorded any material adjustments. We also earn royalties in connection with several of our licenses granted under license and development arrangements with our device partners. These royalties are based upon a percentage of commercial sales of partnered products with rates ranging from mid-single digits to low double digits and are tiered based on levels of net sales. These sales-based royalties, for which the license was deemed the predominant element to which the royalties relate, are estimated and recognized in the period in which the partners’ commercial sales occur. The royalties are generally reported and payable to us within 45 to 60 days after the end of the period in which the commercial sales are made. We base our estimates of royalties earned on actual sales information from our partners when available or estimated, prescription sales from external sources and estimated net selling price. We will record adjustments in the following quarter, if necessary, when final royalty reports are received. To date, we have not recorded any material adjustments. Revenue under ENHANZE and Device Collaborative Agreements ENHANZE Collaboration and License Agreements Under these agreements, we grant the collaboration partner a worldwide license to develop and commercialize products using our ENHANZE technology to combine our patented rHuPH20 enzyme with their proprietary biologics directed at up to a specified number of targets. Targets are usually licensed on an exclusive, global basis. Targets selected subsequent to inception of the arrangement generally require payment of an additional license fee. The collaboration partner is responsible for all development, manufacturing, clinical, regulatory, sales and marketing costs for any products developed under the agreement. We are responsible for supply of bulk rHuPH20 based on the collaboration partner’s purchase orders, and may also be separately engaged to perform research and development services. While these collaboration agreements are similar in that they originate from the same framework, each one is the result of an arms-length negotiation and thus may vary from one to the other. We generally collect an upfront license payment from collaboration partners, and are also entitled to receive event-based payments subject to collaboration partners’ achievement of specified development, regulatory and sales-based milestones. In several agreements, collaboration partners pay us annual fees to maintain their exclusive license rights if they are unable to advance product development to specified stages. We earn separate fees for bulk rHuPH20 supplies and research and development services. Although these agreements are in form identified as collaborative agreements, we concluded for accounting purposes they represent contracts with customers and are not subject to accounting literature on collaborative arrangements. This is because we grant to partners licenses to our intellectual property and provide supply of bulk rHuPH20 and research and development services which are all outputs of our ongoing activities, in exchange for respective consideration. Under these collaborative agreements, our partners lead development of assets, and we do not share in significant financial risks of their development or commercialization activities. Accordingly, we concluded our collaborative agreements are appropriately accounted for pursuant to U.S. GAAP. Under all of our ENHANZE collaborative agreements, we have identified licenses to use functional intellectual property as the only performance obligation. The intellectual property underlying the license is our proprietary ENHANZE technology which represents application of rHuPH20 to facilitate delivery of drugs. Each of the licenses grants the partners rights to use our intellectual property as it exists and is identified on the effective date of the license, because there is no ongoing development of the ENHANZE technology required. Therefore, we recognize revenue from licenses at the point when the license becomes effective and the partner has received access to our intellectual property, usually at the inception of the agreement. When partners can select additional targets to add to the licenses granted, we consider these rights to be options. We evaluate whether such options contain material rights, i.e. have exercise prices that are discounted compared to what we would charge for a similar license to a new partner. The exercise price of these options includes a combination of the target selection fees, event-based milestone payments and royalties. When these amounts in aggregate are not offered at a discount that exceeds discounts available to other customers, we conclude the option does not contain a material right, and we consider grants of additional licensing rights upon option exercises to be separate contracts (target selection contracts). Generally, we provide indemnification and protection of licensed intellectual property for our customers. These provisions are part of assurance that the licenses meet the agreements’ representations and are not obligations to provide goods or services. We also fulfill purchase orders for supply of bulk rHuPH20 and perform research and development services pursuant to projects authorization forms for our partners, which represent separate contracts. In addition to our licenses, we price our supply of bulk rHuPH20 and research and development services at our regular selling prices, called standalone selling prices (“SSP”). Therefore, our partners do not have material rights to order these items at prices not reflective of SSP. Refer to the discussion below regarding recognition of revenue for these separate contracts. Transaction price for a contract represents the amount to which we are entitled in exchange for providing goods and services to the customer. Transaction price does not include amounts subject to uncertainties unless it is probable that there will be no significant reversal of revenue when the uncertainty is resolved. Apart from the upfront license payment (or target selection fees in the target selection contracts), all other fees we may earn under our collaborative agreements are subject to significant uncertainties of product development. Achievement of many of the event-based development and regulatory milestones may not be probable until such milestones are actually achieved. This generally relates to milestones such as obtaining marketing authorization approvals. With respect to other development milestones, e.g., dosing of a first patient in a clinical trial, achievement could be considered probable prior to its actual occurrence, based on the progress towards commencement of the trial. In order to evaluate progress towards commencement of a trial, we assess the status of activities leading up to our partner’s initiation of a trial such as feedback received from the applicable regulatory authorities, completion of Investigational New Drug (“IND”) or equivalent filings, readiness and availability of drug, readiness of study sites and our partner’s commitment of resources to the program. We do not include any amounts subject to uncertainties in the transaction price until it is probable that the amount will not result in a significant reversal of revenue in the future. At the end of each reporting period, we re-evaluate the probability of achievement of such milestones and any related constraint, and if necessary, adjust our estimate of the overall transaction price. When target exchange rights are held by partners, and the amounts attributed to these rights are not refundable, they are included in the transaction price. However, they are recorded as deferred revenues because we have a potential performance obligation to provide a new target upon an exchange right being exercised. These amounts are recognized in revenue when the right of exchange expires or is exercised. Because our agreements have one type of performance obligation (licenses) which are typically all transferred at the same time at agreement inception, allocation of transaction price often is not required. However, allocation is required when licenses for some of the individual targets are subject to rights of exchange, because revenue associated with these targets cannot be recognized. When allocation is needed, we perform an allocation of the upfront amount based on relative SSP of licenses for individual targets. We determine license SSP using an income-based valuation approach utilizing risk-adjusted discounted cash flow projections of the estimated return a licensor would receive. When amounts subject to uncertainties, such as milestones and royalties, are included in the transaction price, we attribute them to the specific individual target licenses which generate such milestone or royalty amounts. We also estimate SSP of bulk rHuPH20 and research and development services, to determine that our partners do not have material rights to order them at discounted prices. For supplies of bulk rHuPH20, because we effectively act as a contract manufacturer to our partners, we estimate and charge SSP based on the typical contract manufacturer margins consistent with all of our partners. We determine SSP of research and development services based on a fully-burdened labor rate. Our rates are comparable to those we observe in other collaborative agreements. We also have a history of charging similar rates to all of our partners. Upfront amounts allocated to licenses to individual targets are recognized as revenue when the license is transferred to the partner, as discussed above, if the license is not subject to exchange rights, or when the exchange right expires or is exercised. Development milestones and other fees are recognized in revenue when they are included in the transaction price, because by that time, we have already transferred the related license to the partner. In contracts to provide research and development services, such services represent the only performance obligation. The fees are charged based on hours worked by our employees and the fixed contractual rate per hour, plus third-party pass-through costs, on a monthly basis. We recognize revenues as the related services are performed based on the amounts billed, as the partner consumes the benefit of research and development work simultaneously as we perform these services, and the amounts billed reflect the value of these services to the customer. Device License, Development and Supply Arrangements We have several license, development and supply arrangements with pharmaceutical partners, under which we grant a license to our device technology and provide research and development services that often involve multiple performance obligations and highly-customized deliverables. For such arrangements, we identify each of the promised goods and services within the contract and the distinct performance obligations at inception of the contract and allocate consideration to each performance obligation based on relative SSP, which is generally determined based on the expected cost plus mark-up. If the contract includes an enforceable right to payment for performance completed to date and performance obligations are satisfied over time, we recognize revenue over the development period using either the input or output method depending on which is most appropriate given the nature of the distinct deliverable. For other contracts that do not contain an enforceable right to payment for performance completed to date, revenue is recognized when control of the product is transferred to the customer. Factors that may indicate transfer of control has occurred include the transfer of legal title, transfer of physical possession, the customer has obtained the significant risks and rewards of ownership of the assets and we have a present right to payment. Our typical payment terms for development contracts may include an upfront payment equal to a percentage of the total contract value with the remaining portion to be billed upon completion and transfer of the individual deliverables or satisfaction of the individual performance obligations. We record a contract liability for cash received in advance of performance, which is presented within deferred revenue and deferred revenue, long-term in our condensed consolidated balance sheets and recognized as revenue in our condensed consolidated statements of income when the associated performance obligations have been satisfied. License fees and milestones received in exchange for the grant of a license to our functional intellectual property, such as patented technology and know-how in connection with a partnered development arrangement, are generally recognized at inception of the arrangement, or over the development period depending on the facts and circumstances, as the license is generally not distinct from the non-licensed goods or services to be provided under the contract. Milestone payments that are contingent upon the occurrence of future events are evaluated and recorded at the most likely amount, and to the extent that it is probable that a significant reversal of revenue will not occur when the associated uncertainty is resolved. Refer to Note 5, Revenue, for further discussion on our collaborative arrangements. Product Sales, Net Proprietary Product Sales Our commercial portfolio of proprietary products includes XYOSTED, TLANDO and Hylenex recombinant which we sell primarily to wholesale pharmaceutical distributors and specialty pharmacies, who sell the products to hospitals, retail chain drug stores and other end-user customers. Sales to wholesalers are made pursuant to purchase orders subject to the terms of a master agreement, and delivery of individual packages of products represents performance obligations under each purchase order. We use contract manufacturers to produce our proprietary products and third-party logistics (“3PL”) vendors to process and fulfill orders. We concluded we are the principal in the sales to wholesalers because we control access to services rendered by both vendors and direct their activities. We have no significant obligations to wholesalers to generate pull-through sales. Revenue is recognized when control has transferred to the customer, which is typically upon delivery, at the net selling price, which reflects the variable consideration for which reserves and sales allowances are established for estimated returns, wholesale distribution fees, prompt payment discounts, government rebates and chargebacks, plan rebate arrangements and patient discount and support programs. We recognize revenue from product sales and related cost of sales upon product delivery to the wholesaler location. At that time, the wholesalers take control of the product as they take title, bear the risk of loss of ownership, and have an enforceable obligation to pay us. They also have the ability to direct sales of product to their customers on terms and at prices they negotiate. Although wholesalers have product return rights, we do not believe they have a significant incentive to return the product to us. The determination of certain reserves and sales allowances requires us to make a number of judgements and estimates to reflect our best estimate of the transaction price and the amount of consideration to which we believe we would be ultimately entitled to receive. The expected value is determined based on unit sales data, contractual terms with customers and third-party payers, historical and estimated future percentage of rebates incurred on sales, historical and future insurance plan billings, any new or anticipated changes in programs or regulations that would impact the amount of the actual rebates, customer purchasing patterns, product expiration dates and levels of inventory in the distribution channel. The estimated amounts of credit for product returns, chargebacks, distribution fees, prompt payment discounts, rebates and customer co-pay support programs are included in accrued expenses and accounts receivable, net in our condensed consolidated balance sheets upon recognition of revenue from product sales. We monitor actual product returns, chargebacks, discounts and fees subsequent to the sale. If these amounts differ from our estimates, we make adjustments to these allowances, which are applied to increase or reduce product sales revenue and earnings in the period of adjustment. Selling prices initially billed to wholesalers are subject to discounts for prompt payment and subsequent chargebacks when wholesalers sell our products at negotiated discounted prices to members of certain group purchasing organizations (“GPOs”), Pharmacy Benefit Managers (“PBMs”) and government programs. We also pay quarterly distribution fees to certain wholesalers for inventory reporting and chargeback processing, and to PBMs and GPOs as administrative fees for services and for access to their members. We concluded the benefits received in exchange for these fees are not distinct from our sales of our products, and accordingly we apply these amounts to reduce revenues. Wholesalers also have rights to return unsold product nearing or past the expiration date. Because of the shelf life of our products and our lengthy return period, there may be a significant period of time between when the product is shipped and when we issue credits on returned product. We estimate the transaction price when we receive each purchase order taking into account the expected reductions of the selling price initially billed to the wholesaler arising from all of the above factors. We have compiled historical experience and data to estimate future returns and chargebacks of our products and the impact of the other discounts and fees we pay. When estimating these adjustments to the transaction price, we reduce it sufficiently to be able to assert that it is probable that there will be no significant reversal of revenue when the ultimate adjustment amounts are known. Each purchase order contains only one type of product, and is usually shipped to the wholesaler in a single shipment. Therefore, allocation of the transaction price to individual packages is not required. In connection with the orders placed by wholesalers, we incur costs such as commissions to our sales representatives. However, as revenue from product sales is recognized upon delivery to the wholesaler, which occurs shortly after we receive a purchase order, we do not capitalize these commissions and other costs, based on application of the practical expedient allowed within the applicable guidance. Partnered Product Sales Bulk rHuPH20 We sell bulk rHuPH20 to partners for use in research and development and, subsequent to receiving marketing approval, we sell it for use in collaboration commercial products. Sales are made pursuant to purchase orders subject to the terms of the collaborative agreement or a supply agreement, and delivery of units of bulk rHuPH20 represent performance obligations under each purchase order. We provide a standard warranty that the product conforms to specifications. We use contract manufacturers to produce bulk rHuPH20 and have concluded we are the principal in the sales to partners. The transaction price for each purchase order of bulk rHuPH20 is fixed based on the cost of production plus a contractual markup, and is not subject to adjustments. Allocation of the transaction price to individual quantities of the product is usually not required because each order contains only one type of product. We recognize revenue from the sale of bulk rHuPH20 as product sales and related cost of sales upon transfer of title to our partners. At that time, the partners take control of the product, bear the risk of loss of ownership, and have an enforceable obligation to pay us. Devices We are party to several license, development, supply and distribution arrangements with pharmaceutical partners, under which we produce and are the exclusive supplier of certain products, devices and/or components. Revenue is recognized when or as control of the goods transfers to the customer as discussed below. We are the exclusive supplier of OTREXUP® to Otter. Because this product is custom manufactured with no alternative use and we have a contractual right to payment for performance completed to date, control is continuously transferred to the customer as the product is produced pursuant to firm purchase orders. Revenue is recognized over time using the output method based on the contractual selling price and number of units produced. The amount of revenue recognized in excess of the amount shipped/billed to the customer, if any, is recorded as contract assets in our condensed consolidated balance sheets due to the short-term nature in which the amount is ultimately expected to be billed and collected from the customer. All other device partnered product sales are recognized at the point in time in which control is transferred to the customer, which is typically upon shipment. Sales terms and pricing are governed by the respective supply and distribution agreements, and there is generally no right of return. Revenue is recognized at the transaction price, which includes the contractual per unit selling price and estimated variable consideration, such as volume-based pricing arrangements or profit-sharing arrangements, if any. We recognize revenue, including the estimated variable consideration we expect to receive for contract margin on future commercial sales, upon shipment of the goods to our partner. The estimated variable consideration is recognized at an amount we believe is not subject to significant reversal of revenue based on historical experience and is adjusted at each reporting period if the most likely amount of expected consideration changes or becomes fixed. Revenue Presentation In our condensed consolidated statements of income, we report the upfront payments, event-based development and regulatory milestones and sales milestones as revenues under collaborative agreements. We also include in this category revenues from separate research and development contracts pursuant to project authorization forms. We report royalties received from partners as a separate line in our condensed consolidated statements of income. Revenues from sales of our proprietary and partnered products are included in product sales, net in our condensed consolidated statements of income. In the footnotes to our condensed consolidated financial statements, we provide disaggregated revenue information by type of arrangement (royalties; product sales, net; and collaborative agreements), and additionally, by type of payment stream received under collaborative agreements (upfront license and target nomination fees; event-based development and regulatory milestones and other fees; sales-based milestones; and device licensing and development revenue). Cost of Sales Cost of sales consists primarily of raw materials, third-party manufacturing costs, fill and finish costs, freight costs, internal costs and manufacturing overhead associated with the production of proprietary and partnered products. Cost of sales also consists of the write-down of excess, dated and obsolete inventories and the write-off of inventories that do not meet certain product specifications, if any.
Research and Development Expenses	Research and Development Expenses Research and development expenses include salaries and benefits, facilities and other overhead expenses, research related manufacturing services, contract services, and other outside expenses. Research and development expenses are charged to operating expenses as incurred when these expenditures relate to our research and development efforts and have no alternative future uses. We are obligated to make upfront payments upon execution of certain research and development agreements. Advance payments, including nonrefundable amounts, for goods or services that will be used or rendered for future research and development activities are deferred. Such amounts are recognized as expense as the related goods are delivered or the related services are performed or such time when we do not expect the goods to be delivered or services to be performed.
Share-Based Compensation	Share-Based Compensation We record compensation expense associated with stock options, restricted stock units (“RSUs”), performance stock units (“PSUs”) and shares issued under our employee stock purchase plan (“ESPP”) in accordance with the authoritative guidance for share-based compensation. The cost of employee services received in exchange for an award of an equity instrument is measured at the grant date, based on the estimated fair value of the award, and is recognized as expense on a straight-line basis over the requisite service period of the award. Share-based compensation expense for an award with a performance condition is recognized when the achievement of such performance condition is determined to be probable. If the outcome of such performance condition is not determined to be probable or is not met, no compensation expense is recognized and any previously recognized compensation expense is reversed. Forfeitures are recognized as a reduction of share-based compensation expense as they occur.
Income Taxes	Income Taxes We provide for income taxes using the liability method. Under this method, deferred income tax assets and liabilities are determined based on the differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases at each reporting period. We measure deferred tax assets and liabilities using enacted tax rates for the year in which the differences are expected to reverse. Significant judgment is required by management to determine our provision for income taxes, our deferred tax assets and liabilities, and any associated valuation allowances recorded against our net deferred tax assets, which are based on complex and evolving tax regulations. Deferred tax assets (“DTA”) and other tax benefits are recorded when they are more likely than not to be realized. On a quarterly basis, we assess the need for valuation allowance on our DTAs, weighing all positive and negative evidence, to assess if it is more-likely-than-not that some or all of our DTAs will be realized. We recorded a provision for income taxes of $19.9 million and $50.9 million using an effective tax rate of 19.9% and 20.6% for the three and nine months ended September 30, 2023, respectively. The difference between our effective tax rate and the U.S. federal statutory rate of 21% is primarily due to state income taxes, tax benefits on the Foreign Derived Intangible Income Deduction (“FDII”), tax detriments on 162(m) and other share-based compensation.
Segment Information	Segment Information We operate our business in one operating segment, which includes all activities related to the research, development and commercialization of our proprietary enzymes and devices. This segment also includes revenues and expenses related to (i) research and development and manufacturing activities conducted under our collaborative agreements with third parties, and (ii) product sales of proprietary and partnered products. The chief operating decision-maker reviews the operating results on an aggregate basis and manages the operations as a single operating segment.
Adoption and Pending Adoption of Recent Accounting Pronouncements	Adoption and Pending Adoption of Recent Accounting Pronouncements There are no relevant recently issued accounting pronouncements that would materially impact our condensed consolidated financial statements and related disclosures.

v3.23.3

Business Combination (Tables)	9 Months Ended
	Sep. 30, 2023
Business Combination and Asset Acquisition [Abstract]
Business Acquisition Unaudited Pro Forma Financial Information	The following unaudited pro forma financial information summarizes combined results of operations of Halozyme and Antares as if the companies had been combined as of the beginning of our fiscal year 2021 (in thousands). Three Months Ended  September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Total revenues $ 216,033  $ 208,976  $ 599,214  $ 531,189  Net income 81,837  66,771  196,206  163,795

v3.23.3

Fair Value Measurement (Tables)	9 Months Ended
	Sep. 30, 2023
Fair Value Disclosures [Abstract]
Schedule of available-for-sale marketable securities	Available-for-sale marketable securities consisted of the following (in thousands): September 30, 2023 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Asset-backed securities $ 4,599  $ —  $ (20) $ 4,579  Corporate debt securities 5,976  —  (31) 5,945  U.S. treasury securities 160,034  —  (104) 159,930  Agency bonds 16,020  —  (73) 15,947  Commercial paper 22,655  —  (1) 22,654  Total marketable securities, available-for-sale $ 209,284  $ —  $ (229) $ 209,055  December 31, 2022 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Asset-backed securities $ 1,146  $ —  $ —  $ 1,146  Corporate debt securities 7,139  —  (9) 7,130  U.S. treasury securities 111,469  —  (934) 110,535  Agency bonds 2,783  2  (1) 2,784  Commercial paper 7,004  —  —  7,004  Total marketable securities, available-for-sale $ 129,541  $ 2  $ (944) $ 128,599
Schedule of contractual maturities of available-for-sale debt securities	The estimated fair value of our contractual maturities of available-for-sale debt securities were as follows (in thousands): September 30, 2023 December 31, 2022 Due within one year $ 179,400  $ 114,353  Due after one year but within five years 29,655  14,246  Total estimated fair value of contractual maturities, available-for-sale $ 209,055  $ 128,599
Schedule of assets measured at fair value on a recurring basis	The following table summarizes, by major security type, our cash equivalents and available-for-sale marketable securities measured at fair value on a recurring basis and are categorized using the fair value hierarchy (in thousands): September 30, 2023 December 31, 2022 Level 1 Level 2 Total estimated fair value Level 1 Level 2 Total estimated fair value Assets Cash equivalents Money market funds $ 147,113  $ —  $ 147,113  $ 191,704  $ —  $ 191,704  U.S. treasury securities 23,000  —  23,000  —  —  —  Available-for-sale marketable    securities Asset-backed securities —  4,579  4,579  —  1,146  1,146  Corporate debt securities —  5,945  5,945  —  7,130  7,130  U.S. treasury securities 159,930  —  159,930  110,535  —  110,535  Agency bonds 15,947  —  15,947  2,784  —  2,784  Commercial paper —  22,654  22,654  —  7,004  7,004  Derivative instruments Currency hedging contracts (1) —  2,163  2,163  —  —  —  Total assets $ 345,990  $ 35,341  $ 381,331  $ 305,023  $ 15,280  $ 320,303  Liabilities Derivative instruments Currency hedging contracts (1) $ —  $ 347  347  $ —  $ —  —  (1) Based on observable market transactions of spot currency rates, forward currency rates or equivalently-termed instruments. Carrying amounts of the financial assets and liabilities are equal to the fair value. As of September 30, 2023, the derivative assets and liabilities recorded within prepaid expenses and other current assets, prepaid expense and other assets and other long-term liabilities were $1.6 million, $0.6 million and $0.3 million, respectively.

v3.23.3

Revenue (Tables)	9 Months Ended
	Sep. 30, 2023
Revenue from Contract with Customer [Abstract]
Schedule of disaggregation of revenues	Our disaggregated revenues were as follows (in thousands): Three Months Ended  September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Royalties $ 114,433  $ 99,551  $ 325,813  $ 254,496  Product sales, net   Sales of bulk rHuPH20 37,001  19,259  86,203  60,764  Sale of proprietary products 31,511  24,180  91,765  44,559  Sale of device partnered products 18,057  17,988  43,284  24,544  Total product sales, net $ 86,569  $ 61,427  $ 221,252  $ 129,867  Revenues under collaborative agreements   Upfront license and target nomination fees —  —  —  30,000    Event-based development and regulatory milestone and other fees 13,000  44,000  46,000  59,000    Device licensing and development revenue 2,031  3,998  6,149  5,257  Total revenues under collaborative agreements $ 15,031  $ 47,998  $ 52,149  $ 94,257  Total revenues $ 216,033  $ 208,976  $ 599,214  $ 478,620
Schedule of accounts receivable, deferred revenues from contracts with customers, and amounts under collaborative agreements included in transaction price	Accounts receivable, other contract assets and deferred revenues (contract liabilities) from contracts with customers, including partners, consisted of the following (in thousands): September 30, 2023 December 31, 2022 Accounts receivable, net $ 213,987  $ 186,970  Other contract assets 3,338  44,102  Deferred revenues 2,920  5,499

v3.23.3

Certain Balance Sheet Items (Tables)	9 Months Ended
	Sep. 30, 2023
Balance Sheet Related Disclosures [Abstract]
Schedule of accounts receivable	Accounts receivable, net and contract assets consisted of the following (in thousands): September 30, 2023 December 31, 2022 Accounts receivable from product sales to partners $ 50,172  $ 62,979  Accounts receivable from revenues under collaborative agreements 17,357  18,776  Accounts receivable from royalty payments 113,632  100,900  Accounts receivable from other product sales 38,758  6,229  Contract assets 3,338  44,102       Total accounts receivable and contract assets 223,257  232,986  Allowance for distribution fees and discounts (5,932) (1,914)      Total accounts receivable, net and contract assets $ 217,325  $ 231,072
Schedule of inventories	Inventories, net consisted of the following (in thousands): September 30, 2023 December 31, 2022 Raw materials $ 26,930  $ 13,792  Work-in-process 37,573  40,361  Finished goods 64,418  45,970       Total inventories, net $ 128,921  $ 100,123
Schedule of prepaid expenses and other assets	Prepaid expenses and other assets consisted of the following (in thousands): September 30, 2023 December 31, 2022 Prepaid manufacturing expenses $ 47,527  $ 51,694  Other prepaid expenses 7,258  4,647  Other assets 12,808  14,984       Total prepaid expenses and other assets 67,593  71,325  Less: Long-term portion (18,115) (26,301)      Total prepaid expenses and other assets, current $ 49,478  $ 45,024
Schedule of property and equipment, net	Property and equipment, net consisted of the following (in thousands): September 30, 2023 December 31, 2022 Research equipment $ 8,353  $ 7,380  Manufacturing equipment 31,231  27,893  Computer and office equipment 9,117  7,855  Leasehold improvements 6,856  6,729       Subtotal 55,557  49,857  Accumulated depreciation and amortization (18,091) (14,756)      Subtotal 37,466  35,101  Right of use of assets 37,203  40,469       Property and equipment, net $ 74,669  $ 75,570
Schedule of accrued expenses	Accrued expenses consisted of the following (in thousands): September 30, 2023 December 31, 2022 Accrued compensation and payroll taxes $ 13,995  $ 19,939  Accrued outsourced manufacturing expenses 13,870  12,190  Income taxes payable 18,029  —  Product returns and sales allowance 36,458  30,261  Other accrued expenses 8,912  29,771  Lease liability 32,358  34,788       Total accrued expenses 123,622  126,949  Less long-term portion (28,422) (30,433)      Total accrued expenses, current $ 95,200  $ 96,516

v3.23.3

Goodwill and Intangible Assets (Tables)	9 Months Ended
	Sep. 30, 2023
Goodwill and Intangible Assets Disclosure [Abstract]
Schedule of Goodwill	A summary of the activity impacting goodwill is presented below (in thousands): Balance as of December 31, 2022 $ 409,049  Measurement period adjustment (1) 7,772  Balance as of September 30, 2023 $ 416,821  (1) Refer to Note 3, Business Combination, for further discussion on the measurement period adjustment.
Schedule of Finite-Lived Intangible Assets	The following table shows the cost, accumulated amortization and weighted average useful life in years for our acquired intangible assets as of September 30, 2023 (in thousands). Weighted average useful life (in years) Gross Carrying Value Accumulated Amortization Net Carrying Value Auto injector technology platform 7 $ 402,000  $ 77,806  $ 324,194  XYOSTED proprietary product 10 136,200  18,453  117,747  Total finite-lived intangibles, net (1) $ 538,200  $ 96,259  $ 441,941  ATRS-1902 (IPR&D) Indefinite 48,700  Total intangibles, net $ 490,641  (1) An impairment charge of $2.5 million was recognized in the three months ended September 30, 2023 resulting in the full impairment of the TLANDO product rights intangible asset. The impairment charge resulted from the notice of termination of the TLANDO license agreement provided to Lipocine in September 2023, effective January 31, 2024, and is included in amortization of intangibles in our condensed consolidated statements of income.
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense	Estimated future annual amortization of finite-lived intangible assets is shown in the following table (in thousands). Actual amortization expense to be reported in future periods could differ from these estimates as a result of acquisitions, divestitures, and asset impairments, among other factors. Year Amortization Expense Remainder of 2023 $ 17,762  2024 71,049  2025 71,049  2026 71,049  2027 71,049  Thereafter 139,983  Total $ 441,941

v3.23.3

Long-Term Debt, Net (Tables)	9 Months Ended
	Sep. 30, 2023
Debt Disclosure [Abstract]
Schedule of Carrying Values and Estimated Fair Values of Debt Instruments	Net Carrying Amounts of our Convertible Notes The carrying amount and fair value of our Convertible Notes were as follows (in thousands). September 30, 2023 December 31, 2022 Principal amount 2024 Convertible Notes $ —  $ 13,483  2027 Convertible Notes 805,000  805,000  2028 Convertible Notes 720,000  720,000  Total principal amount $ 1,525,000  $ 1,538,483  Unamortized debt discount 2024 Convertible Notes $ —  $ (149) 2027 Convertible Notes (11,805) (14,359) 2028 Convertible Notes (15,574) (17,875) Total unamortized debt discount $ (27,379) $ (32,383) Carrying amount 2024 Convertible Notes $ —  $ 13,334  2027 Convertible Notes 793,195  790,641  2028 Convertible Notes 704,426  702,125  Total carrying amount $ 1,497,621  $ 1,506,100  Fair value based on trading levels (Level 2): 2024 Convertible Notes $ —  $ 32,176  2027 Convertible Notes 681,835  784,770  2028 Convertible Notes 674,892  849,823  Total fair value of outstanding notes $ 1,356,727  $ 1,666,769  Remaining amortization per period of debt discount (in years): 2024 Convertible Notes —  1.9 2027 Convertible Notes 3.4 4.2 2028 Convertible Notes 4.9 5.6
Interest Income and Interest Expense Disclosure	The following table summarizes the components of interest expense and the effective interest rates for each of our Convertible Notes (in thousands). Three Months Ended  September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Coupon interest 2024 Convertible Notes $ —  $ 161  $ 36  $ 729  2027 Convertible Notes 503  503  1,509  1,509  2028 Convertible Notes 1,800  860  5,400  860  Total coupon interest $ 2,303  $ 1,524  $ 6,945  $ 3,098  Amortization of debt discount 2024 Convertible Notes $ —  $ 84  $ 24  $ 338  2027 Convertible Notes 853  847  2,555  2,537  2028 Convertible Notes 770  363  2,301  363  Total amortization of debt discount $ 1,623  $ 1,294  $ 4,880  $ 3,238  Interest expense 2024 Convertible Notes $ —  $ 245  $ 60  $ 1,067  2027 Convertible Notes 1,356  1,350  4,064  4,046  2028 Convertible Notes 2,570  1,223  7,701  1,223  Total interest expense $ 3,926  $ 2,818  $ 11,825  $ 6,336  Effective interest rates 2024 Convertible Notes —  1.8  % —  1.8  % 2027 Convertible Notes 0.7  % 0.7  % 0.7  % 0.7  % 2028 Convertible Notes 1.5  % 1.5  % 1.5  % 1.5  %

v3.23.3

Share-based Compensation (Tables)	9 Months Ended
	Sep. 30, 2023
Share-Based Payment Arrangement, Noncash Expense [Abstract]
Schedule of share-based compensation expense	The following table summarized share-based compensation expense included in our condensed consolidated statements of income related to share-based awards (in thousands): Three Months Ended  September 30, Nine Months Ended September 30,   2023 2022 2023 2022 Research and development $ 3,159  $ 2,695  $ 9,931  $ 7,168  Selling, general and administrative 6,208  4,102  17,025  10,006  Total share-based compensation expense $ 9,367  $ 6,797  $ 26,956  $ 17,174
Schedule of share-based compensation expense by type	Share-based compensation expense by type of share-based award (in thousands): Three Months Ended  September 30, Nine Months Ended September 30,   2023 2022 2023 2022 Stock options $ 4,290  $ 2,801  $ 11,935  $ 7,924  RSUs, PSUs and ESPP 5,077  3,996  15,021  9,250  Total share-based compensation expense $ 9,367  $ 6,797  $ 26,956  $ 17,174
Schedule of assumptions used in Black-Scholes model	The assumptions used in the Black-Scholes model were as follows: Three Months Ended  September 30, Nine Months Ended September 30,   2023 2022 2023 2022 Expected volatility 40.70 - 40.82% 40.37 - 50.80% 39.68-40.82% 40.37-50.80% Average expected term (in years) 4.9 4.7 4.8 4.7 Risk-free interest rate 4.19 - 4.29% 2.66 - 3.39% 3.37-4.29% 1.37-3.39% Expected dividend yield —  —  —  —
Schedule of unrecognized estimated compensation cost by type	Total unrecognized estimated compensation cost by type of award and the weighted-average remaining requisite service period over which such expense is expected to be recognized was as follows (in thousands, unless otherwise noted): September 30, 2023   Unrecognized Expense Remaining Weighted-Average Recognition Period (years) Stock options $ 41,893  2.75 RSUs 36,721  2.51 PSUs 7,153  1.68 ESPP 110  0.21

v3.23.3

Stockholders' Equity (Tables)	9 Months Ended
	Sep. 30, 2023
Equity [Abstract]
Schedule of share repurchases	We had the following activity under the approved share repurchase programs (dollars in thousands, except share and per share data): 2023 Total Number of Shares Purchased Weighted Average Price Paid Per Share Total Cost(1) First quarter 4,165,258  $ 36.01  $ 150,083  Second quarter —  —  —  Third quarter —  —  —  4,165,258  $ 36.01  $ 150,083  (1) Included in the total cost of shares purchased is a commission fee of $0.02 per share.

v3.23.3

Earnings per share (Tables)	9 Months Ended
	Sep. 30, 2023
Earnings Per Share [Abstract]
Schedule of reconciliation of numerators and denominators of basic and diluted computations	A reconciliation of the numerators and the denominators of the basic and diluted earnings per common share computations is as follows (in thousands, except per share amounts): Three Months Ended  September 30, Nine Months Ended September 30,   2023 2022 2023 2022 Numerator Net income $ 81,837  $ 61,634  $ 196,206  $ 144,427  Denominator Weighted average common shares outstanding for basic earnings per share 131,965  136,527  132,896  137,370  Dilutive potential common stock outstanding Stock options 1,830  2,237  1,882  2,211  RSUs, PSUs and ESPP 288  363  378  362  Convertible Notes —  260  77  1,076  Weighted average common shares outstanding for diluted earnings per share 134,083  139,387  135,233  141,019  Earnings per share Basic $ 0.62  $ 0.45  $ 1.48  $ 1.05  Diluted $ 0.61  $ 0.44  $ 1.45  $ 1.02
Antidilutive securities excluded from calculation of diluted earnings per common share	Shares which have been excluded from the calculation of diluted earnings per common share because their effect was anti-dilutive include the following (shares in millions): Three Months Ended  September 30, Nine Months Ended September 30,   2023 2022 2023 2022 Anti-dilutive securities (1) 27.4  25.6  27.6  19.0  (1) The anti-dilutive securities include outstanding stock options, unvested RSUs, unvested PSUs, common shares expected to be issued under our ESPP and Convertible Notes

v3.23.3

Organization and Business (Details)	9 Months Ended
	Sep. 30, 2023 product collaborator
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Royalties received, number of collaborators | collaborator	4
Takeda
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Royalties received, number of products sold	1
Roche
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Royalties received, number of products sold	4
Janssen
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Royalties received, number of products sold	1
Argenx
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Royalties received, number of products sold	1

v3.23.3

Summary of Significant Accounting Policies - Restricted Cash (Details) - USD ($)	Sep. 30, 2023	Dec. 31, 2022
Accounting Policies [Abstract]
Restricted cash	$ 0	$ 500,000

v3.23.3

Summary of Significant Accounting Policies - Leases (Details)	Sep. 30, 2023
Minimum
Lessee, Lease, Description [Line Items]
Term of leases	3 years
Maximum
Lessee, Lease, Description [Line Items]
Term of leases	12 years

v3.23.3

Summary of Significant Accounting Policies - Cash Flow Hedges - Currency Risks (Details) - Cash Flow Hedging - Foreign Currency Exchange	3 Months Ended
	Sep. 30, 2023
Accounting Policies [Abstract]
Derivative, contract term	4 years
Derivative [Line Items]
Derivative, contract term	4 years

v3.23.3

Summary of Significant Accounting Policies - Revenue and Cost of Product Sales (Details)	9 Months Ended
	Sep. 30, 2023
Accounting Policies [Abstract]
Period of contract termination by written notice	90 days

v3.23.3

Summary of Significant Accounting Policies - Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Accounting Policies [Abstract]
Income tax provision	$ 19,923	$ 12,073	$ 50,948	$ 33,700
Effective income tax rate, percent	19.90%		20.60%

v3.23.3

Summary of Significant Accounting Policies - Segment Information (Details)	9 Months Ended
	Sep. 30, 2023 segment
Accounting Policies [Abstract]
Number of operating segments	1

v3.23.3

Business Combination - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands		3 Months Ended	9 Months Ended
	May 24, 2022	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Business Acquisition [Line Items]
Goodwill, adjustments			$ 7,772
Antares Pharma, Inc
Business Acquisition [Line Items]
Consideration transferred	$ 1,045,700
Consideration transferred, cash paid per acquiree share (in usd per share)	$ 5.60
Goodwill, adjustments			7,800
Business combination, adjustment, accrued expense			2,000
Business combination, adjustment, deferred tax liabilities, net			5,600
Business combination, adjustment, accounts receivable			200
Pro forma revenue of acquiree since acquisition date		$ 50,400	$ 69,100	$ 75,300
Proforma earnings or loss of acquiree since acquisition date				$ 35,500

v3.23.3

Business Combination - Unaudited Pro Forma Information (Details) - Antares Pharma, Inc - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Business Acquisition [Line Items]
Total revenues	$ 216,033	$ 208,976	$ 599,214	$ 531,189
Net income	$ 81,837	$ 66,771	$ 196,206	$ 163,795

v3.23.3

Fair Value Measurement - Components of Available-for-sale Marketable Securities (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Schedule of Available-for-sale Securities
Amortized Cost	$ 209,284	$ 129,541
Gross Unrealized Gains	0	2
Gross Unrealized Losses	(229)	(944)
Estimated Fair Value	209,055	128,599
Asset-backed securities
Schedule of Available-for-sale Securities
Amortized Cost	4,599	1,146
Gross Unrealized Gains	0	0
Gross Unrealized Losses	(20)	0
Estimated Fair Value	4,579	1,146
Corporate debt securities
Schedule of Available-for-sale Securities
Amortized Cost	5,976	7,139
Gross Unrealized Gains	0	0
Gross Unrealized Losses	(31)	(9)
Estimated Fair Value	5,945	7,130
U.S. treasury securities
Schedule of Available-for-sale Securities
Amortized Cost	160,034	111,469
Gross Unrealized Gains	0	0
Gross Unrealized Losses	(104)	(934)
Estimated Fair Value	159,930	110,535
Agency bonds
Schedule of Available-for-sale Securities
Amortized Cost	16,020	2,783
Gross Unrealized Gains	0	2
Gross Unrealized Losses	(73)	(1)
Estimated Fair Value	15,947	2,784
Commercial paper
Schedule of Available-for-sale Securities
Amortized Cost	22,655	7,004
Gross Unrealized Gains	0	0
Gross Unrealized Losses	(1)	0
Estimated Fair Value	$ 22,654	$ 7,004

v3.23.3

Fair Value Measurement - Narrative (Details)	3 Months Ended		9 Months Ended
	Sep. 30, 2023 USD ($) security	Sep. 30, 2022 USD ($)	Sep. 30, 2023 USD ($) security	Sep. 30, 2022 USD ($)	Dec. 31, 2022 USD ($)
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Number of loss positions | security	43		43
Fair market value of gross unrealized loss position	$ 196,800,000		$ 196,800,000
Unrealized loss position of debt securities	229,000		229,000		$ 944,000
Credit loss	0		0
Available-for-sale marketable securities	209,055,000		209,055,000		128,599,000
Gain on change in amount of contingent consideration liability	13,200,000	$ 0	13,200,000	$ 0
Antares Pharma, Inc
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Gain on change in amount of contingent consideration liability	13,200,000
Level 3
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Available-for-sale marketable securities	$ 0		$ 0		$ 0

v3.23.3

Fair Value Measurement - Contractual Maturities of Available for Sale Debt Securities (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Fair Value Disclosures [Abstract]
Due within one year	$ 179,400	$ 114,353
Due after one year but within five years	29,655	14,246
Total estimated fair value of contractual maturities, available-for-sale	$ 209,055	$ 128,599

v3.23.3

Fair Value Measurement - Assets Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Assets
Available-for-sale marketable securities	$ 209,055	$ 128,599
Total assets	381,331	320,303
Liabilities
Derivative asset, current	1,600
Derivative asset, noncurrent	600
Derivative liability, noncurrent	$ 300
Derivative Asset, Statement of Financial Position [Extensible Enumeration]	Total prepaid expenses and other assets, current
Derivative Liability, Current, Statement of Financial Position [Extensible Enumeration]	Total accrued expenses, current
Derivative Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration]	Other long-term liabilities
Foreign Currency Exchange
Assets
Currency hedging contracts	$ 2,163	0
Liabilities
Currency hedging contracts	347	0
Asset-backed securities
Assets
Available-for-sale marketable securities	4,579	1,146
Corporate debt securities
Assets
Available-for-sale marketable securities	5,945	7,130
U.S. treasury securities
Assets
Available-for-sale marketable securities	159,930	110,535
Agency bonds
Assets
Available-for-sale marketable securities	15,947	2,784
Commercial paper
Assets
Available-for-sale marketable securities	22,654	7,004
Money market funds
Assets
Cash equivalents	147,113	191,704
U.S. treasury securities
Assets
Cash equivalents	23,000	0
Level 1
Assets
Total assets	345,990	305,023
Level 1 | Foreign Currency Exchange
Assets
Currency hedging contracts	0	0
Liabilities
Currency hedging contracts	0	0
Level 1 | Asset-backed securities
Assets
Available-for-sale marketable securities	0	0
Level 1 | Corporate debt securities
Assets
Available-for-sale marketable securities	0	0
Level 1 | U.S. treasury securities
Assets
Available-for-sale marketable securities	159,930	110,535
Level 1 | Agency bonds
Assets
Available-for-sale marketable securities	15,947	2,784
Level 1 | Commercial paper
Assets
Available-for-sale marketable securities	0	0
Level 1 | Money market funds
Assets
Cash equivalents	147,113	191,704
Level 1 | U.S. treasury securities
Assets
Cash equivalents	23,000	0
Level 2
Assets
Total assets	35,341	15,280
Level 2 | Foreign Currency Exchange
Assets
Currency hedging contracts	2,163	0
Liabilities
Currency hedging contracts	347	0
Level 2 | Asset-backed securities
Assets
Available-for-sale marketable securities	4,579	1,146
Level 2 | Corporate debt securities
Assets
Available-for-sale marketable securities	5,945	7,130
Level 2 | U.S. treasury securities
Assets
Available-for-sale marketable securities	0	0
Level 2 | Agency bonds
Assets
Available-for-sale marketable securities	0	0
Level 2 | Commercial paper
Assets
Available-for-sale marketable securities	22,654	7,004
Level 2 | Money market funds
Assets
Cash equivalents	0	0
Level 2 | U.S. treasury securities
Assets
Cash equivalents	$ 0	$ 0

v3.23.3

Revenue - Disaggregated Revenues (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Disaggregation of Revenue [Line Items]
Total revenues	$ 216,033	$ 208,976	$ 599,214	$ 478,620
Royalties
Disaggregation of Revenue [Line Items]
Total revenues	114,433	99,551	325,813	254,496
Product sales, net
Disaggregation of Revenue [Line Items]
Total revenues	86,569	61,427	221,252	129,867
bulk rHuPH20
Disaggregation of Revenue [Line Items]
Total revenues	37,001	19,259	86,203	60,764
Sale of proprietary products
Disaggregation of Revenue [Line Items]
Total revenues	31,511	24,180	91,765	44,559
Sale of device partnered products
Disaggregation of Revenue [Line Items]
Total revenues	18,057	17,988	43,284	24,544
Collaborative Agreements
Disaggregation of Revenue [Line Items]
Total revenues	15,031	47,998	52,149	94,257
Upfront license and target nomination fees
Disaggregation of Revenue [Line Items]
Total revenues	0	0	0	30,000
Event-based development and regulatory milestone and other fees
Disaggregation of Revenue [Line Items]
Total revenues	13,000	44,000	46,000	59,000
Device licensing and development revenue
Disaggregation of Revenue [Line Items]
Total revenues	$ 2,031	$ 3,998	$ 6,149	$ 5,257

v3.23.3

Revenue - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2023	Sep. 30, 2023	Dec. 31, 2022
Disaggregation of Revenue [Line Items]
Revenue recognized variable consideration and other uncertainties satisfied	$ 13,000	$ 46,000
Revenue recognized previously included in deferred revenue	100	3,200
Deferred revenues	2,920	2,920	$ 5,499
Contract assets	3,300	3,300
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-10-01
Disaggregation of Revenue [Line Items]
Revenue, remaining performance obligation	$ 700	$ 700
Deferred revenue, remaining performance obligation, expected timing	12 months	12 months
Other collaborators
Disaggregation of Revenue [Line Items]
Revenue, remaining performance obligation	$ 86,100	$ 86,100
License Fees and Event-Based
Disaggregation of Revenue [Line Items]
Revenue recognized from prior periods	127,400	371,800
Product sales, net
Disaggregation of Revenue [Line Items]
Revenue remaining performance obligations, related to unfulfilled product purchase orders	$ 83,200	$ 83,200

v3.23.3

Revenue - Accounts Receivable, Other Contract Assets and Contract Liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Revenue from Contract with Customer [Abstract]
Accounts receivable, net	$ 213,987	$ 186,970
Contract assets	3,338	44,102
Deferred revenues	$ 2,920	$ 5,499

v3.23.3

Certain Balance Sheet Items - Accounts Receivable, net (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Accounts, Notes, Loans and Financing Receivable [Line Items]
Contract assets	$ 3,338	$ 44,102
Total accounts receivable and contract assets	223,257	232,986
Allowance for distribution fees and discounts	(5,932)	(1,914)
Total accounts receivable, net and contract assets	217,325	231,072
Sale of device partnered products
Accounts, Notes, Loans and Financing Receivable [Line Items]
Accounts receivable	50,172	62,979
Revenues under collaborative agreements
Accounts, Notes, Loans and Financing Receivable [Line Items]
Accounts receivable	17,357	18,776
Royalties
Accounts, Notes, Loans and Financing Receivable [Line Items]
Accounts receivable	113,632	100,900
Other product sales
Accounts, Notes, Loans and Financing Receivable [Line Items]
Accounts receivable	$ 38,758	$ 6,229

v3.23.3

Certain Balance Sheet Items - Inventories (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Balance Sheet Related Disclosures [Abstract]
Raw materials	$ 26,930	$ 13,792
Work-in-process	37,573	40,361
Finished goods	64,418	45,970
Total inventories, net	$ 128,921	$ 100,123

v3.23.3

Certain Balance Sheet Items - Prepaid Expenses and Other Assets (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Prepaid manufacturing expenses	$ 47,527	$ 51,694
Other prepaid expenses	7,258	4,647
Other assets	12,808	14,984
Total prepaid expenses and other assets	67,593	71,325
Less: Long-term portion	(18,115)	(26,301)
Total prepaid expenses and other assets, current	$ 49,478	$ 45,024

v3.23.3

Certain Balance Sheet Items - Property and Equipment, net (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022	Dec. 31, 2022
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 55,557		$ 55,557		$ 49,857
Accumulated depreciation and amortization	(18,091)		(18,091)		(14,756)
Subtotal	37,466		37,466		35,101
Right of use of assets	37,203		37,203		40,469
Property and equipment, net	74,669		74,669		75,570
Depreciation and amortization	2,700	$ 2,000	8,152	$ 3,931
Right-of-use asset amortization	1,400	$ 700	4,200	$ 1,700
Research equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	8,353		8,353		7,380
Manufacturing equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	31,231		31,231		27,893
Computer and office equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	9,117		9,117		7,855
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 6,856		$ 6,856		$ 6,729

v3.23.3

Certain Balance Sheet Items - Accrued Expenses (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022	Dec. 31, 2022
Balance Sheet Related Disclosures [Abstract]
Accrued compensation and payroll taxes	$ 13,995		$ 13,995		$ 19,939
Accrued outsourced manufacturing expenses	13,870		13,870		12,190
Income taxes payable	18,029		18,029		0
Product returns and sales allowance	36,458		36,458		30,261
Other accrued expenses	8,912		8,912		29,771
Lease liability	32,358		32,358		34,788
Total accrued expenses	123,622		123,622		126,949
Less long-term portion	(28,422)		(28,422)		(30,433)
Total accrued expenses, current	95,200		95,200		$ 96,516
Expense associated with accretion of lease liabilities	600	$ 100	1,900	$ 300
Total operating lease cost	2,000	900	6,100	2,000
Cash paid for amounts related to leases	$ 1,600	$ 1,100	$ 5,000	$ 2,700

v3.23.3

Goodwill and Intangible Assets - Goodwill Rollforward (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2023 USD ($)
Goodwill [Roll Forward]
Goodwill, Beginning Balance	$ 409,049
Measurement period adjustment	7,772
Goodwill, Ending Balance	$ 416,821

v3.23.3

Goodwill and Intangible Assets - Additional (Details)	9 Months Ended
	Sep. 30, 2023
Minimum
Finite-Lived Intangible Assets [Line Items]
Weighted average useful life (in years)	7 years
Maximum
Finite-Lived Intangible Assets [Line Items]
Weighted average useful life (in years)	10 years

v3.23.3

Goodwill and Intangible Assets - Intangible Assets (Details) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2023	Sep. 30, 2023	Dec. 31, 2022
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Value	$ 538,200	$ 538,200
Accumulated Amortization	96,259	96,259
Net Carrying Value	441,941	441,941
ATRS-1902 (IPR&D)	48,700	48,700
Total intangibles, net	490,641	$ 490,641	$ 546,652
Auto injector technology platform
Finite-Lived Intangible Assets [Line Items]
Weighted average useful life (in years)		7 years
Gross Carrying Value	402,000	$ 402,000
Accumulated Amortization	77,806	77,806
Net Carrying Value	324,194	$ 324,194
XYOSTED proprietary product
Finite-Lived Intangible Assets [Line Items]
Weighted average useful life (in years)		10 years
Gross Carrying Value	136,200	$ 136,200
Accumulated Amortization	18,453	18,453
Net Carrying Value	117,747	$ 117,747
TLANDO product rights
Finite-Lived Intangible Assets [Line Items]
Impairment charge	$ 2,500

v3.23.3

Goodwill and Intangible Assets - Future Amortization (Details) $ in Thousands	Sep. 30, 2023 USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]
Remainder of 2023	$ 17,762
2024	71,049
2025	71,049
2026	71,049
2027	71,049
Thereafter	139,983
Total	$ 441,941

v3.23.3

Long-Term Debt, Net - Narrative (Details)	1 Months Ended						3 Months Ended		9 Months Ended		12 Months Ended
	Mar. 31, 2023 USD ($) shares	Aug. 31, 2022 USD ($) trading_day businessDay $ / shares shares	May 31, 2022 USD ($)	Mar. 31, 2021 USD ($) trading_day businessDay $ / shares shares	Jan. 31, 2021 $ / shares	Nov. 30, 2019 USD ($) trading_day	Sep. 30, 2023 USD ($)	Sep. 30, 2022 USD ($)	Sep. 30, 2023 USD ($)	Sep. 30, 2022 USD ($)	Dec. 31, 2022 USD ($)	Dec. 31, 2021 USD ($)	Aug. 15, 2022 $ / shares	May 24, 2022 USD ($)
Debt Instrument [Line Items]
Aggregate principal							$ 1,525,000,000		$ 1,525,000,000		$ 1,538,483,000
Proceeds from issuance of 2028 Convertible Notes									0	$ 702,000,000
Payment of debt issuance cost									0	6,465,000
Payment for capped calls									0	69,120,000
Conversion of debt, principal	$ 13,500,000	$ 77,600,000		$ 369,100,000
Repayments of convertible debt		$ 77,400,000		$ 370,200,000					13,483,000	77,453,000
Stock issued for conversion of debt instrument (shares) | shares	288,886	1,510,000
Induced conversion expense related to convertible notes							0	$ 2,712,000	0	2,712,000	2,700,000	$ 21,000,000
Proceeds from revolving credit facilities									0	$ 120,000,000
Common Stock
Debt Instrument [Line Items]
Stock issued for conversion of debt instrument (shares) | shares				9,080,000.00
1.00% Convertible Senior Notes due 2028
Debt Instrument [Line Items]
Aggregate principal							720,000,000		720,000,000		720,000,000
Cap call transaction, cap price per share (in usd per share) | $ / shares		$ 75.4075
Sale of stock premium over last reported sale price, percentage		75.00%
Sale of stock, price per share (in usd per share) | $ / shares													$ 43.09
Payment for capped calls		$ 69,100,000
1.00% Convertible Senior Notes due 2028 | Convertible Debt
Debt Instrument [Line Items]
Interest rate, stated percentage		1.00%
Aggregate principal		$ 720,000,000
Lenders fee		18,000,000
Proceeds from issuance of 2028 Convertible Notes		702,000,000
Payment of debt issuance cost		$ 1,000,000
Debt, convertible, conversion ratio		17.8517
Debt, convertible, conversion price (in usd per share) | $ / shares		$ 56.02
1.00% Convertible Senior Notes due 2028 | Convertible Debt | Period One
Debt Instrument [Line Items]
Convertible, threshold percentage of stock price trigger		130.00%
Convertible, threshold trading days | trading_day		20
Convertible, threshold consecutive trading days | trading_day		30
1.00% Convertible Senior Notes due 2028 | Convertible Debt | Period Two
Debt Instrument [Line Items]
Convertible, threshold percentage of stock price trigger		98.00%
Convertible, threshold consecutive trading days | trading_day		5
Convertible, threshold consecutive business days | businessDay		5
0.25% Convertible Senior Notes due 2027
Debt Instrument [Line Items]
Aggregate principal							805,000,000		805,000,000		805,000,000
Proceeds from issuance of 2028 Convertible Notes				$ 784,900,000
0.25% Convertible Senior Notes due 2027 | Convertible Debt
Debt Instrument [Line Items]
Interest rate, stated percentage				0.25%
Aggregate principal				$ 805,000,000
Lenders fee				20,100,000
Payment of debt issuance cost				$ 400,000
Debt, convertible, conversion ratio				12.9576
Debt, convertible, conversion price (in usd per share) | $ / shares				$ 77.17
0.25% Convertible Senior Notes due 2027 | Convertible Debt | Period One
Debt Instrument [Line Items]
Convertible, threshold percentage of stock price trigger				130.00%
Convertible, threshold trading days | trading_day				20
Convertible, threshold consecutive trading days | trading_day				30
0.25% Convertible Senior Notes due 2027 | Convertible Debt | Period Two
Debt Instrument [Line Items]
Convertible, threshold percentage of stock price trigger				98.00%
Convertible, threshold consecutive trading days | trading_day				5
Convertible, threshold consecutive business days | businessDay				5
1.25% Convertible Senior Notes due 2024
Debt Instrument [Line Items]
Aggregate principal							0		0		$ 13,483,000
Proceeds from issuance of 2028 Convertible Notes						$ 447,300,000
1.25% Convertible Senior Notes due 2024 | Convertible Debt
Debt Instrument [Line Items]
Interest rate, stated percentage						1.25%
Aggregate principal						$ 460,000,000
Lenders fee						12,700,000
Payment of debt issuance cost						$ 300,000
Debt, convertible, conversion ratio					41.9208
Debt, convertible, conversion price (in usd per share) | $ / shares					$ 23.85
1.25% Convertible Senior Notes due 2024 | Convertible Debt | Period One
Debt Instrument [Line Items]
Convertible, threshold percentage of stock price trigger						130.00%
Convertible, threshold trading days | trading_day						20
Convertible, threshold consecutive trading days | trading_day						30
1.25% Convertible Senior Notes due 2024 | Convertible Debt | Period Two
Debt Instrument [Line Items]
Convertible, threshold percentage of stock price trigger						98.00%
Convertible, threshold trading days | trading_day						5
Convertible, threshold consecutive trading days | trading_day						5
Credit Agreement | Revolving Credit Facility
Debt Instrument [Line Items]
Credit facility, maximum borrowing capacity		$ 575,000,000	$ 350,000,000											$ 350,000,000
Proceeds from revolving credit facilities			$ 120,000,000
Debt issuance costs														$ 3,600,000
Credit Agreement | Minimum | Revolving Credit Facility
Debt Instrument [Line Items]
Commitment fee percentage			0.15%
Credit Agreement | Maximum | Revolving Credit Facility
Debt Instrument [Line Items]
Commitment fee percentage			0.35%
Credit Agreement | SOFR | Revolving Credit Facility | Variable Rate Component One
Debt Instrument [Line Items]
Basis spread on variable rate			0.10%
Credit Agreement | SOFR | Minimum | Revolving Credit Facility
Debt Instrument [Line Items]
Basis spread on variable rate			1.00%
Credit Agreement | SOFR | Minimum | Revolving Credit Facility | Variable Rate Component Two
Debt Instrument [Line Items]
Basis spread on variable rate			1.25%
Credit Agreement | SOFR | Maximum | Revolving Credit Facility
Debt Instrument [Line Items]
Basis spread on variable rate			1.10%
Credit Agreement | SOFR | Maximum | Revolving Credit Facility | Variable Rate Component Two
Debt Instrument [Line Items]
Basis spread on variable rate			2.25%
Credit Agreement | Fed Funds Rate | Revolving Credit Facility
Debt Instrument [Line Items]
Basis spread on variable rate			0.50%
Credit Agreement | Base Rate | Minimum | Revolving Credit Facility
Debt Instrument [Line Items]
Basis spread on variable rate			0.25%
Credit Agreement | Base Rate | Maximum | Revolving Credit Facility
Debt Instrument [Line Items]
Basis spread on variable rate			1.25%
Credit Agreement | Term Loan Facility
Debt Instrument [Line Items]
Credit facility, maximum borrowing capacity			$ 250,000,000
Proceeds from revolving credit facilities			$ 250,000,000
Unamortized debt issuance cost							$ 2,500,000		$ 2,500,000
Credit Agreement | Term Loan Facility | Year one
Debt Instrument [Line Items]
Interest rate, stated percentage			2.50%
Credit Agreement | Term Loan Facility | Year two
Debt Instrument [Line Items]
Interest rate, stated percentage			5.00%
Credit Agreement | Term Loan Facility | Year three
Debt Instrument [Line Items]
Interest rate, stated percentage			7.50%
Credit Agreement | Term Loan Facility | Year four
Debt Instrument [Line Items]
Interest rate, stated percentage			10.00%

v3.23.3

Long-Term Debt, Net - Carrying Amount of Convertible Notes (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Debt Instrument [Line Items]
Total principal amount	$ 1,525,000	$ 1,538,483
Total unamortized debt discount	(27,379)	(32,383)
Current portion of long-term debt, net	0	13,334
Long-term debt, excluding current maturities	1,497,621	1,492,766
Total carrying amount	1,497,621	1,506,100
Total fair value of outstanding notes	1,356,727	1,666,769
1.25% Convertible Senior Notes due 2024
Debt Instrument [Line Items]
Total principal amount	0	13,483
Total unamortized debt discount	0	(149)
Current portion of long-term debt, net	0	13,334
Total fair value of outstanding notes	0	$ 32,176
Remaining amortization per period of debt discount (in years):		1 year 10 months 24 days
0.25% Convertible Senior Notes due 2027
Debt Instrument [Line Items]
Total principal amount	805,000	$ 805,000
Total unamortized debt discount	(11,805)	(14,359)
Long-term debt, excluding current maturities	793,195	790,641
Total fair value of outstanding notes	$ 681,835	$ 784,770
Remaining amortization per period of debt discount (in years):	3 years 4 months 24 days	4 years 2 months 12 days
1.00% Convertible Senior Notes due 2028
Debt Instrument [Line Items]
Total principal amount	$ 720,000	$ 720,000
Total unamortized debt discount	(15,574)	(17,875)
Long-term debt, excluding current maturities	704,426	702,125
Total fair value of outstanding notes	$ 674,892	$ 849,823
Remaining amortization per period of debt discount (in years):	4 years 10 months 24 days	5 years 7 months 6 days

v3.23.3

Long-Term Debt, Net - Components of Interest Expense (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Debt Instrument [Line Items]
Total amortization of debt discount			$ 5,476	$ 6,007
Convertible Debt
Debt Instrument [Line Items]
Total coupon interest	$ 2,303	$ 1,524	6,945	3,098
Total amortization of debt discount	1,623	1,294	4,880	3,238
Total interest expense	3,926	2,818	11,825	6,336
1.25% Convertible Senior Notes due 2024 | Convertible Debt
Debt Instrument [Line Items]
Total coupon interest	0	161	36	729
Total amortization of debt discount	0	84	24	338
Total interest expense	$ 0	$ 245	$ 60	$ 1,067
Effective interest rates	0.00%	1.80%	0.00%	1.80%
0.25% Convertible Senior Notes due 2027 | Convertible Debt
Debt Instrument [Line Items]
Total coupon interest	$ 503	$ 503	$ 1,509	$ 1,509
Total amortization of debt discount	853	847	2,555	2,537
Total interest expense	$ 1,356	$ 1,350	$ 4,064	$ 4,046
Effective interest rates	0.70%	0.70%	0.70%	0.70%
1.00% Convertible Senior Notes due 2028 | Convertible Debt
Debt Instrument [Line Items]
Total coupon interest	$ 1,800	$ 860	$ 5,400	$ 860
Total amortization of debt discount	770	363	2,301	363
Total interest expense	$ 2,570	$ 1,223	$ 7,701	$ 1,223
Effective interest rates	1.50%	1.50%	1.50%	1.50%

v3.23.3

Share-based Compensation - Share-based Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total share-based compensation expense	$ 9,367	$ 6,797	$ 26,956	$ 17,174
Stock options
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total share-based compensation expense	4,290	2,801	11,935	7,924
RSUs, PSUs and ESPP
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total share-based compensation expense	5,077	3,996	15,021	9,250
Research and development
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total share-based compensation expense	3,159	2,695	9,931	7,168
Selling, general and administrative
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total share-based compensation expense	$ 6,208	$ 4,102	$ 17,025	$ 10,006

v3.23.3

Share-based Compensation - Narrative (Details) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended		9 Months Ended
	Feb. 28, 2021	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock options granted (in shares)		200,000	100,000	1,800,000	1,600,000
2021 ESPP Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares available for grant (in shares)		2,630,346		2,630,346
ESPP | 2021 ESPP Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
ESPP purchase price of common stock, percent of market price	85.00%
Minimum employee subscription rate	1.00%
Maximum employee subscription rate	15.00%
Maximum contribution amount	$ 25
Purchase period (in months)	6 months
Shares issued (in shares)				19,757

v3.23.3

Share-based Compensation - Assumptions Used in the Black-Scholes Model (Details)	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Schedule of Share-based Compensation Arrangements Valuation Inputs [Line Items]
Average expected term (in years)	4 years 10 months 24 days	4 years 8 months 12 days	4 years 9 months 18 days	4 years 8 months 12 days
Risk-free interest rate, minimum	4.19%	2.66%	3.37%	1.37%
Risk-free interest rate, maximum	4.29%	3.39%	4.29%	3.39%
Expected dividend yield	0.00%	0.00%	0.00%	0.00%
Minimum
Schedule of Share-based Compensation Arrangements Valuation Inputs [Line Items]
Expected volatility	40.70%	40.37%	39.68%	40.37%
Maximum
Schedule of Share-based Compensation Arrangements Valuation Inputs [Line Items]
Expected volatility	40.82%	50.80%	40.82%	50.80%

v3.23.3

Share-based Compensation - Unrecognized Estimated Compensation Cost (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2023 USD ($)
Stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized Expense	$ 41,893
Remaining Weighted-Average Recognition Period (years)	2 years 9 months
RSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized Expense	$ 36,721
Remaining Weighted-Average Recognition Period (years)	2 years 6 months 3 days
PSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized Expense	$ 7,153
Remaining Weighted-Average Recognition Period (years)	1 year 8 months 4 days
ESPP
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized Expense	$ 110
Remaining Weighted-Average Recognition Period (years)	2 months 15 days

v3.23.3

Stockholders' Equity - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands	1 Months Ended	3 Months Ended			9 Months Ended		12 Months Ended		22 Months Ended
	Dec. 31, 2021	Sep. 30, 2023	Jun. 30, 2023	Mar. 31, 2023	Sep. 30, 2023	Sep. 30, 2022	Dec. 31, 2022	Dec. 31, 2021	Sep. 30, 2023
Stockholders' equity (deficit) (textual)
Capital return program, authorized amount (in shares)	$ 750,000							$ 750,000
Capital return program, purchase period	3 years
Stock repurchased (in shares)							4,500,000	3,900,000	12,600,000
Stock repurchased		$ 0	$ 0	$ 150,083	$ 150,083		$ 200,000	$ 150,000	$ 500,000
Weighted-average price paid per share (usd per share)		$ 0	$ 0	$ 36.01	$ 36.01		$ 44.44	$ 38.51	$ 39.81
Remaining amount authorized to be repurchase		$ 250,000			$ 250,000				$ 250,000
Stock options
Stockholders' equity (deficit) (textual)
Number of shares of common stock issued as a result of stock option exercises (in shares)					455,702	483,385
Stock options weighted average exercise price (usd per share)					$ 18.10	$ 18.45
Net proceeds from stock options exercised					$ 8,200	$ 8,900
Restricted stock units
Stockholders' equity (deficit) (textual)
Stock issued during period, shares, restricted stock award, net of forfeitures (in shares)					328,115	252,063
Number of RSUs withheld to pay for minimum withholding taxes (in shares)					70,733	68,425
Payments for tax withholding for restricted stock units vested, net					$ 7,200	$ 4,300
Stock options and restricted units
Stockholders' equity (deficit) (textual)
Outstanding stock options and restricted stock units (in shares)		7,700,000			7,700,000		6,600,000		7,700,000

v3.23.3

Stockholders' Equity - Share Repurchase Activity (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended			9 Months Ended	12 Months Ended		22 Months Ended
	Sep. 30, 2023	Jun. 30, 2023	Mar. 31, 2023	Sep. 30, 2023	Dec. 31, 2022	Dec. 31, 2021	Sep. 30, 2023
Equity [Abstract]
Total Number of Shares Purchased (shares)	0	0	4,165,258	4,165,258
Weighted-average price paid per share (usd per share)	$ 0	$ 0	$ 36.01	$ 36.01	$ 44.44	$ 38.51	$ 39.81
Total Cost	$ 0	$ 0	$ 150,083	$ 150,083	$ 200,000	$ 150,000	$ 500,000
Fee per share (usd per share)				$ 0.02

v3.23.3

Earnings per share - Computation (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Numerator
Net income	$ 81,837	$ 61,634	$ 196,206	$ 144,427
Denominator
Weighted average common shares outstanding for basic earnings per share (shares)	131,965	136,527	132,896	137,370
Dilutive potential common stock outstanding
Weighted average common shares outstanding for diluted earnings per share (shares)	134,083	139,387	135,233	141,019
Earnings per share
Basic (USD per share)	$ 0.62	$ 0.45	$ 1.48	$ 1.05
Diluted (USD per share)	$ 0.61	$ 0.44	$ 1.45	$ 1.02
Convertible Notes
Dilutive potential common stock outstanding
Dilutive potential common stock outstanding (shares)	0	260	77	1,076
Stock options
Dilutive potential common stock outstanding
Dilutive potential common stock outstanding (shares)	1,830	2,237	1,882	2,211
RSUs, PSUs and ESPP
Dilutive potential common stock outstanding
Dilutive potential common stock outstanding (shares)	288	363	378	362

v3.23.3

Earnings per share - Antidilutive Securities (Details) - shares shares in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Earnings Per Share [Abstract]
Anti-dilutive shares excluded from per share calculation (in shares)	27,400	25,600	27,600	19,000

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