0000906709-22-000005 | 10-K | XBRL Viewer

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Consolidated Statements of Cash Flows - USD ($)	12 Months Ended			118 Months Ended
Consolidated Statements of Cash Flows - USD ($)	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2021
Cash flows from operating activities:
Net loss	$ (523,837,000)	$ (444,440,000)	$ (440,667,000)
Adjustments to reconcile net loss to net cash used in operating activities:
Non-cash royalty revenue related to the sales of future royalties	(77,746,000)	(48,563,000)	(36,303,000)	$ (333,451,000)
Non-cash interest expense on liabilities related to sales of future royalties	47,313,000	30,267,000	25,044,000	244,273,000
Loss on revaluation of liability related to the sale of future royalties	24,410,000	0	0
Change in fair value of development derivative liability	8,023,000	0	0
Non-cash research and development expense	16,703,000	0	0
Stock-based compensation	94,674,000	94,261,000	99,795,000
Depreciation and amortization	14,146,000	14,182,000	13,156,000
Impairment of advance payments to contract manufacturers and equipment for terminated program	0	20,351,000	0
Amortization of premiums (discounts), net and other non-cash transactions	(6,730,000)	(3,943,000)	11,394,000
Changes in operating assets and liabilities
Accounts receivable	12,397,000	1,913,000	6,411,000
Inventory	(509,000)	(2,627,000)	(1,284,000)
Operating leases, net	2,340,000	2,743,000	13,090,000
Other assets	(2,688,000)	4,476,000	1,190,000
Accounts payable	(11,690,000)	2,382,000	12,967,000
Accrued compensation	1,203,000	4,697,000	1,530,000
Other accrued expenses	(23,524,000)	8,644,000	4,349,000
Deferred revenue	(605,000)	(5,516,000)	(16,565,000)
Net cash used in operating activities	(412,660,000)	(313,287,000)	(328,681,000)
Cash flows from investing activities:
Purchases of investments	(960,689,000)	(987,533,000)	(1,380,865,000)
Maturities of investments	1,166,951,000	1,449,304,000	1,614,036,000
Sales of investments	11,504,000	41,700,000	0
Purchases of property, plant and equipment	(14,989,000)	(7,258,000)	(26,285,000)
Net cash provided by investing activities	202,777,000	496,213,000	206,886,000
Cash flows from financing activities:
Proceeds from sale of future royalties, net of $3.8 million of transaction costs	0	146,250,000	0
Repayment of senior notes	0	(250,000,000)	0
Cash receipts from development derivative liability	3,000,000	0	0
Proceeds from shares issued under equity compensation plans	33,238,000	23,396,000	23,355,000
Net cash provided by (used in) financing activities	36,238,000	(80,354,000)	23,355,000
Effect of foreign exchange rates on cash and cash equivalents	(92,000)	20,000	(102,000)
Net increase (decrease) in cash and cash equivalents	(173,737,000)	102,592,000	(98,542,000)
Cash and cash equivalents at beginning of year	198,955,000	96,363,000	194,905,000
Cash and cash equivalents at end of year	25,218,000	198,955,000	96,363,000	$ 25,218,000
Supplemental disclosure of cash flow information:
Cash paid for interest	0	9,742,000	19,199,000
Cash paid for income taxes	325,000	539,000	555,000
Operating lease right-of-use assets recognized in exchange for lease liabilities	1,057,000	2,133,000	57,691,000
Accounts receivable recognized in exchange for long-term liabilities	$ 0	$ 4,000,000	$ 0

Income Taxes - Schedule of Income Tax Provision Related to Continuing Operations (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Income Tax Disclosure [Abstract]
Income tax benefit at federal statutory rate	$ (109,889)	$ (93,229)	$ (92,411)
Research credits	(4,727)	(3,081)	(10,511)
Change in valuation allowance	97,914	87,060	104,440
Non-cash interest expense on liability related to sales of future royalties	9,936	6,356	5,259
Non-cash royalty revenue related to sales of future royalties	(7,891)	(7,967)	(7,624)
Loss on revaluation of liability related to the sale of future royalties	4,940	0	0
Stock-based compensation	6,627	7,929	(672)
Other	3,647	3,425	2,132
Provision for income taxes	$ 557	$ 493	$ 613

Consolidated Statements of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock	Capital in Excess of Par Value	Accumulated Other Comprehensive Loss	Accumulated Deficit
Beginning Balance (in shares) at Dec. 31, 2018		173,530
Beginning Balance at Dec. 31, 2018	$ 1,717,575	$ 17	$ 3,147,925	$ (6,316)	$ (1,424,051)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Shares issued under equity compensation plans (in shares)		2,975
Shares issued under equity compensation plans	23,377	$ 0	23,377
Stock-based compensation	99,795		99,795
Comprehensive loss	(435,356)			5,311	(440,667)
Ending Balance (in shares) at Dec. 31, 2019		176,505
Ending Balance at Dec. 31, 2019	1,405,391	$ 17	3,271,097	(1,005)	(1,864,718)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Shares issued under equity compensation plans (in shares)		3,586
Shares issued under equity compensation plans	23,373	$ 1	23,372
Stock-based compensation	94,261		94,261
Comprehensive loss	(445,730)			(1,290)	(444,440)
Ending Balance (in shares) at Dec. 31, 2020		180,091
Ending Balance at Dec. 31, 2020	1,077,295	$ 18	3,388,730	(2,295)	(2,309,158)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Shares issued under equity compensation plans (in shares)		5,377
Shares issued under equity compensation plans	33,238	$ 1	33,237
Stock-based compensation	94,674		94,674
Comprehensive loss	(525,699)			(1,862)	(523,837)
Ending Balance (in shares) at Dec. 31, 2021		185,468
Ending Balance at Dec. 31, 2021	$ 679,508	$ 19	$ 3,516,641	$ (4,157)	$ (2,832,995)

- Definition

Total of all stockholders' equity (deficit) items, net of receivables from officers, directors, owners, and affiliates of the entity which are attributable to the parent. The amount of the economic entity's stockholders' equity attributable to the parent excludes the amount of stockholders' equity which is allocable to that ownership interest in subsidiary equity which is not attributable to the parent (noncontrolling interest, minority interest). This excludes temporary equity and is sometimes called permanent equity.

+ References

Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef
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-Name Accounting Standards Codification
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Reference 2: http://www.xbrl.org/2003/role/exampleRef
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Reference 7: http://www.xbrl.org/2009/role/commonPracticeRef
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Reference 8: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 323
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-Paragraph 3
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-URI http://asc.fasb.org/extlink&oid=114001798&loc=d3e33918-111571

+ Details

Inventory (Tables)

12 Months Ended

Dec. 31, 2021

Inventory Disclosure [Abstract]

Schedule of Inventory

Inventory consists of the following (in thousands):


	December 31,
	2021		2020
Raw materials	$	3,166	$	2,422
Work-in-process	9,342		10,703
Finished goods	3,293		2,167
Total inventory	$	15,801	$	15,292

Operating Leases - Schedule of Future Minimum Lease Payments for Operating Leases (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Leases [Abstract]
2022	$ 18,626
2023	20,909
2024	21,572
2025	22,255
2026	22,957
2027 and thereafter	75,411
Total lease payments	181,730
Less: portion representing interest	(37,900)
Less: lease incentives	(653)
Operating lease liabilities	143,177
Operating lease liabilities, current portion	(17,441)	$ (13,915)
Operating lease liabilities, less current portion	$ 125,736	$ 136,373

Income Taxes - Schedule of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward]
Beginning balance	$ 78,665	$ 77,410	$ 27,419
Tax positions related to current year:
Additions	2,371	2,512	49,858
Reductions	0	0	0
Tax positions related to prior years:
Additions	58	193	277
Reductions	(490)	(1,450)	(144)
Settlements	0	0	0
Lapses in statute of limitations	0	0	0
Ending balance	$ 80,604	$ 78,665	$ 77,410

Operating Leases (Tables)

12 Months Ended

Dec. 31, 2021

Leases [Abstract]

Schedule of Operating Lease Information

The following table presents key information regarding these leases (dollars in thousands):


	Mission Bay Facility		Third Street Facility
Lease commencement	September 2017		June 2018
Lease term	January 2030		January 2030
Space delivered during the year ended December 31, 2020
Square footage	4,940		—
Right-of-use asset and lease liability recognized	$	2,133	$	—
Space delivered during the year ended December 31, 2021
Square footage	2,012		—
Right-of-use asset and lease liability recognized	$	1,057	$	—
Renewal terms	Two consecutive five-year terms		One five-year term

Schedule of Lease Expense

The components of lease expense, which we include in operating expenses in our Consolidated Statements of Operations, were as follows (in thousands):


	Year Ended December 31,
	2021		2020		2019
Operating lease expense	$	19,153	$	18,985	$	14,697
Variable lease expense	8,974		8,179		6,408
Total lease expense	$	28,127	$	27,164	$	21,105

Schedule of Future Minimum Lease Payments for Operating Leases

As of December 31, 2021, the maturities of our operating lease liabilities were as follows (in thousands):


Year ending December 31,
2022	$	18,626
2023	20,909
2024	21,572
2025	22,255
2026	22,957
2027 and thereafter	75,411
Total lease payments	181,730
Less: portion representing interest	(37,900)
Less: lease incentives	(653)
Operating lease liabilities	143,177
Less: current portion	(17,441)
Operating lease liabilities, less current portion	$	125,736

Cash and Investments in Marketable Securities - Schedule of Portfolio of Cash and Investments in Marketable Securities (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Amortized Cost	$ 763,287
Gross Unrealized Gains	12	$ 1,100
Gross Unrealized Losses	(674)	(200)
Fair Value	762,625	1,003,348
Cash	1,250	6,285
Total cash and investments in marketable securities	798,783	1,198,558
Corporate notes and bonds \| Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Amortized Cost	278,475
Gross Unrealized Gains	7
Gross Unrealized Losses	(361)
Fair Value	278,121	687,469
Corporate commercial paper \| Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Amortized Cost	478,932
Gross Unrealized Gains	5
Gross Unrealized Losses	(308)
Fair Value	478,629	313,497
Obligations of U.S. government agencies \| Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Amortized Cost	5,880
Gross Unrealized Gains	0
Gross Unrealized Losses	(5)
Fair Value	5,875	2,382
Money market funds \| Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments in marketable securities	23,968	179,302
Certificates of deposit \| Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments in marketable securities	$ 10,940	$ 9,623

Income Taxes - Additional Information (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Income Taxes Disclosure [Line Items]
Valuation allowance, increase (decrease) amount	$ (115,600)	$ 95,000
Income tax research credits	4,727	3,081	$ 10,511
Unrecognized tax benefits, interest recognized	0	0	0
Unrecognized tax benefits, penalties recognized	$ 0	$ 0	$ 0
Unrecognized tax benefits, period may increase or decrease due to tax examination	12 months
Federal
Income Taxes Disclosure [Line Items]
Net operating loss carryforward for income tax	$ 2,400,000
Income tax research credits	103,300
Federal orphan drug credits	19,400
State
Income Taxes Disclosure [Line Items]
Net operating loss carryforward for income tax	1,500,000
Income tax research credits	$ 47,000

Organization and Summary of Significant Accounting Policies (Policies)	12 Months Ended
	Dec. 31, 2021
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization	Organization We are a research-based biopharmaceutical company headquartered in San Francisco, California and incorporated in Delaware. We are developing a pipeline of drug candidates that utilize our advanced polymer conjugate technology platforms, which are designed to enable the development of new molecular entities that target known mechanisms of action. Our research and development pipeline of new investigational drugs includes investigational treatments for cancer, autoimmune disease and viral infections. Our research and development activities have required significant ongoing investment to date and are expected to continue to require significant investment. As a result, we expect to continue to incur substantial losses and negative cash flows from operations in the future. We have financed our operations primarily through cash generated from licensing, collaboration and manufacturing agreements and financing transactions.
Basis of Presentation, Principles of Consolidation and Use of Estimates	Basis of Presentation, Principles of Consolidation and Use of Estimates Our Consolidated Financial statements include the financial position, results of operations and cash flows of our wholly-owned subsidiaries: Nektar Therapeutics Europe GmbH, Nektar Therapeutics (India) Private Limited (Nektar India), Inheris Biopharma, Inc. (Inheris) and certain other entities in Europe. We have eliminated all intercompany accounts and transactions in consolidation. Our Consolidated Financial Statements are denominated in U.S. dollars. Accordingly, changes in exchange rates between the applicable foreign currency and the U.S. dollar will affect the translation of each foreign subsidiary’s financial results into U.S. dollars for purposes of reporting our consolidated financial results. We include translation gains and losses in accumulated other comprehensive loss in the stockholders’ equity section of our Consolidated Balance Sheets. To date, such cumulative currency translation adjustments have not been significant to our consolidated financial position. Our comprehensive loss consists of our net loss plus our foreign currency translation gains and losses and unrealized holding gains and losses on available-for-sale securities. There were no significant reclassifications out of accumulated other comprehensive loss to the statements of operations during the years ended December 31, 2021, 2020 and 2019. The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Accounting estimates and assumptions are inherently uncertain. Actual results could differ materially from those estimates and assumptions. Our estimates include those related to the selling prices of performance obligations and amounts of variable consideration in collaboration agreements, royalty revenue, and other assumptions required for revenue recognition as described further below; the net realizable value of inventory; the impairment of investments, goodwill and long-lived assets; contingencies, accrued clinical trial, contract manufacturing and other expenses; non-cash royalty revenue and non-cash interest expense from our liabilities related to our sales of future royalties; assumptions used in the valuation of our development derivative liability as further described in Note 6; our assumptions used in stock-based compensation; and ongoing litigation, among other estimates. We base our estimates on historical experience and on other assumptions that management believes are reasonable under the circumstances. These estimates form the basis for making judgments about the carrying values of assets and liabilities when these values are not readily apparent from other sources. As appropriate, we assess estimates each period, update them to reflect current information, and will generally reflect any changes in estimates in the period first identified.
Reclassifications	Reclassifications Certain items previously reported in specific financial statement captions have been reclassified to conform to the current period presentation. Such reclassifications do not materially impact previously reported revenue, operating loss, net loss, total assets, liabilities or stockholders’ equity.
Fair Value of Financial Instruments	Fair Value of Financial Instruments The recorded amounts of certain financial instruments, including cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate their fair values due to their relatively short maturities. Investments that are classified as available-for-sale are recorded at estimated fair value. The disclosed fair value related to our cash equivalents and investments is based on market prices from a variety of industry standard data providers and generally represent quoted prices for similar assets in active markets or have been derived from observable market data. Development derivative liability is recorded at its estimated fair value based on management′s estimates of several unobservable inputs, including the probabilities of success of ongoing clinical trials and various other inputs described above and in Note 6. The fair value of our financial assets and liabilities are determined in accordance with the fair value hierarchy established in ASC 820-10, Fair Value Measurements and Disclosures (ASC 820). ASC 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The fair value hierarchy of ASC Topic 820 requires an entity to maximize the use of observable inputs when measuring fair value and classifies those inputs into three levels: Level 1 — Quoted prices in active markets for identical assets or liabilities. Level 2 — Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices for identical or similar assets or liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. For the years ended December 31, 2021 and 2020, there were no transfers between Level 1 and Level 2 of the fair value hierarchy. Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.
Cash, Cash Equivalents, and Investments in Marketable Securities	Cash, Cash Equivalents, and Investments in Marketable Securities We consider all investments in marketable securities with an original maturity of three months or less when purchased to be cash equivalents. We classify investments in securities with remaining maturities of less than one year, or where our intent is to use the investments to fund current operations or to make them available for current operations, as short-term investments. We classify investments in securities with remaining maturities of over one year as long-term investments. Our cash and investments are held or issued by financial institutions that management believes are of high credit quality. However, they are exposed to credit risk in the event of default by the third parties that hold or issue such assets. Our investment policy limits investments to fixed income securities denominated and payable in U.S. dollars such as corporate bonds, corporate commercial paper, U.S. government obligations, and money market funds and places restrictions on maturities and concentrations by type and issuer. For our available-for-sale securities, we have significant concentrations of issuers in the banking and financial services industry. While our investment policy requires that we only invest in highly-rated securities and limit our exposure to any single issuer, the COVID-19 pandemic may materially affect the financial condition of issuers. Additionally, pursuant to our investment policy, we may sell securities before maturity if the issuer’s credit rating has been downgraded below our minimum credit rating requirements, which may result in a loss on the sale. As a result of the COVID-19 pandemic, we have seen credit downgrades for certain of our securities. Accordingly, if the COVID-19 pandemic or other factors result in downgrades below our minimum credit rating requirements and if we decide to sell these securities, we may experience losses on such sales. Investments are designated as available-for-sale and are carried at fair value with unrealized gains and losses reported in stockholders’ equity as accumulated other comprehensive income (loss). We review our portfolio of available-for-sale debt securities, using both quantitative and qualitative factors, to determine if declines in fair value below amortized cost have resulted from a credit-related loss or other factors. If the decline in fair value is due to credit-related factors, we recognize a loss in our Consolidated Statement of Operations, whereas if the decline in fair value is not due to credit-related factors, we recognize the loss in other comprehensive income (loss). We include coupon interest on securities classified as available-for-sale, as well as amortization of premiums and accretion of discounts to maturity, in interest income. The cost of securities sold is based on the specific identification method.
Accounts Receivable and Significant Customer Concentrations	Accounts Receivable and Significant Customer Concentrations Our customers are primarily pharmaceutical and biotechnology companies that are primarily located in the U.S. and Europe and with whom we have multi-year arrangements. Our accounts receivable balance contains billed and unbilled trade receivables from product sales, milestones (to the extent that they have been achieved and are due from the counterparty), other contingent payments, as well as reimbursable costs from collaborative research and development agreements.We perform a regular review of our partners’ credit risk and payment histories when circumstances warrant, including payments made subsequent to year-end. When appropriate, we provide for an allowance for doubtful accounts by reserving for specifically identified doubtful accounts, although historically we have not experienced credit losses from our accounts receivable.
Inventory and Significant Supplier Concentrations	Inventory and Significant Supplier Concentrations We generally manufacture inventory upon receipt of firm purchase orders from our collaboration partners, and we may manufacture certain intermediate work-in-process materials and purchase raw materials based on purchase forecasts from our collaboration partners. Inventory includes direct materials, direct labor, and manufacturing overhead, and we determine cost on a first-in, first-out basis for raw materials and on a specific identification basis for work-in-process and finished goods. We value inventory at the lower of cost or net realizable value, and we write down defective or excess inventory to net realizable value based on historical experience or projected usage. We expense inventory related to our research and development activities when we purchase or manufacture it. Before the regulatory approval of our drug candidates, we recognize research and development expense for the manufacture of drug products that could potentially be available to support the commercial launch of our drug candidates, if approved. We are dependent on our suppliers and contract manufacturers to provide raw materials and drugs of appropriate quality and reliability and to meet applicable contract and regulatory requirements. In certain cases, we rely on single sources of supply of one or more critical materials. Consequently, in the event that supplies are delayed or interrupted for any reason, including as a result of the COVID-19 pandemic, our ability to develop and produce our drug candidates, our ability to supply comparator drugs for our clinical trials, or our ability to meet our supply obligations could be significantly impaired, which could have a material adverse effect on our business, financial condition and results of operations.
Long-Lived Assets	Long-Lived Assets We state property, plant and equipment at cost, net of accumulated depreciation. We capitalize major improvements and expense maintenance and repairs as incurred. We generally recognize depreciation on a straight-line basis. We depreciate manufacturing, laboratory and other equipment over their estimated useful lives of generally three to ten years, depreciate buildings over the estimated useful life of generally twenty years and amortize leasehold improvements over the shorter of the estimated useful lives or the remaining term of the related lease. Goodwill represents the excess of the price paid for another entity over the fair value of the assets acquired and liabilities assumed in a business combination. We are organized in one reporting unit and evaluate the goodwill for the Company as a whole. Goodwill has an indefinite useful life and is not amortized, but instead tested for impairment at least annually in the fourth quarter of each year using an October 1 measurement date. We assess the impairment of long-lived assets whenever events or changes in business circumstances indicate that the carrying amounts of the assets may not be fully recoverable. In the case of property, plant and equipment and right-of-use assets for our leases, we determine whether there has been an impairment by comparing the carrying value of the asset to the anticipated undiscounted net cash flows associated with the asset. If such cash flows are less than the carrying value, we write down the asset to its fair value, which may be measured as anticipated discounted net cash flows associated with the asset. In the case of goodwill impairment, we compare the carrying value of the reporting unit to its fair value, which we generally measure using market capitalization for our single reporting unit. If an impairment exists, we write down goodwill such that the carrying value of the reporting units equals its fair value.
Leases	Leases We determine if an arrangement contains a lease at the inception of the arrangement. Right-of-use assets represent our right to use an underlying asset for the lease term, and lease liabilities represent our obligation to make lease payments arising from the lease. We recognize operating lease right-of-use assets and liabilities at the lease commencement date based on the present value of lease payments over the expected lease term. In determining the present value of lease payments, we use our incremental borrowing rate based on the information available at the lease commencement date. We have elected the practical expedient to account for the lease and non-lease components, such as common area maintenance charges, as a single lease component for our facilities leases, and elected the short-term lease recognition exemption for our short-term leases, which allows us not to recognize lease liabilities and right-of-use assets for leases with an original term of twelve months or less. Our expected lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise any such options. We recognize lease expense for our operating leases on a straight-line basis over the expected lease term. We have elected to recognize lease incentives, such as tenant improvement allowances, at the lease commencement date as a reduction of the right-of-use asset and lease liability until paid to us by the lessor to the extent that the lease provides a specified fixed or maximum level of reimbursement and we are reasonably certain to incur reimbursable costs at least equaling such amounts. Please see Note 7 for additional information regarding our leases.
Collaborative Arrangements	Collaborative Arrangements We enter into collaboration arrangements with pharmaceutical and biotechnology collaboration partners, under which we may grant licenses to our collaboration partners to further develop and commercialize one of our drug candidates, either alone or in combination with the collaboration partners’ compounds, or grant licenses to partners to use our technology to research and develop their own drug candidates. We may also perform research, development, manufacturing and supply activities under our collaboration agreements. Consideration under these contracts may include an upfront payment, development and regulatory milestones and other contingent payments, expense reimbursements, royalties based on net sales of approved drugs, and commercial sales milestone payments. Additionally, these contracts may provide options for the customer to purchase our proprietary PEGylation materials, drug candidates or additional contract research and development services under separate contracts. When we enter into collaboration agreements, we assess whether the arrangements fall within the scope of ASC 808, Collaborative Arrangements (ASC 808) based on whether the arrangements involve joint operating activities and whether both parties have active participation in the arrangement and are exposed to significant risks and rewards of the arrangement. To the extent that the arrangement falls within the scope of ASC 808, we assess whether the payments between us and our collaboration partner fall within the scope of other accounting literature. If we conclude that payments from the collaboration partner to us represent consideration from a customer, such as license fees and contract research and development activities, we account for those payments within the scope of ASC 606, Revenue from Contracts with Customers (ASC 606). However, if we conclude that our collaboration partner is not a customer for certain activities and associated payments, such as for certain collaborative research, development, manufacturing and commercial activities, we present such payments as a reduction of research and development expense or general and administrative expense, based on where we present the underlying expense.
Revenue Recognition	Revenue Recognition For elements of those arrangements that we determine should be accounted for under ASC 606, we assess which activities in our collaboration agreements are performance obligations that should be accounted for separately and determine the transaction price of the arrangement, which includes the assessment of the probability of achievement of future milestones and other potential consideration. For arrangements that include multiple performance obligations, such as granting a license or performing contract research and development activities or participation on joint steering or other committees, we allocate upfront and milestone payments under a relative standalone selling price method. Accordingly, we develop assumptions that require judgment to determine the standalone selling price for each performance obligation identified in the contract. These key assumptions may include revenue forecasts, clinical development timelines and costs, discount rates and probabilities of clinical and regulatory success. Product sales Product sales are primarily derived from manufacturing and supply agreements with our customers. We have assessed our current manufacturing and supply arrangements and have generally determined that they provide the customer an option to purchase our proprietary PEGylation materials. Accordingly, we treat each purchase order as a discrete exercise of the customer’s option (i.e. a separate contract) rather than as a component of the overall arrangement. The pricing for the manufacturing and supply is generally at a fixed price and may be subject to annual producer price index (PPI) adjustments. We invoice and recognize product sales when title and risk of loss pass to the customer, which generally occurs upon shipment. Customer payments are generally due 30 days from receipt of invoice. We test our products for adherence to technical specifications before shipment; accordingly, we have not experienced any significant returns from our customers. We recognize costs related to shipping and handling of product to customers in cost of goods sold. Royalty revenue, including Non-cash royalty revenue Generally, for our collaboration arrangements that include sales-based royalties, we have granted our collaboration partner a license to our intellectual property. Pursuant to these arrangements, our collaboration partners are typically obligated to pay a royalty that is based on the net sales of their approved drugs that are sold in the countries where we have intellectual property rights covering their drugs. As of December 30, 2021, we have sold our rights to receive sales-based royalties for CIMZIA®, MIRCERA®, MOVANTIK®, ADYNOVATE® and REBINYN® as further described in Note 8. For collaboration arrangements that include sales-based royalties, we have concluded that the license is the predominant item to which the royalties relate, which include commercial milestone payments based on the level of sales. Accordingly, we recognize royalty revenue when the underlying sales occur based on our best estimates of sales of the drugs. Our aggregate royalty and non-cash royalty revenue of $77.7 million, $79.6 million and $77.5 million for the years ended December 31, 2021, 2020 and 2019, respectively, represents revenue for granting licenses for which we had satisfied in prior periods. Our partners generally pay royalties or commercial milestones after the end of the calendar quarter in accordance with contractual terms. We present commercial milestone payments within license, collaboration and other revenue. License, collaboration and other revenue License Grants: For collaboration arrangements that include a grant of a license to our intellectual property, we consider whether the license grant is distinct from the other performance obligations included in the arrangement. Generally, we would conclude that the license is distinct if the customer is able to benefit from the license with the resources available to it. For licenses that are distinct, we recognize revenues from nonrefundable, upfront payments and other consideration allocated to the license when the license term has begun and we have provided all necessary information regarding the underlying intellectual property to the customer, which generally occurs at or near the inception of the arrangement. Milestone Payments: At the inception of the arrangement and at each reporting date thereafter, we assess whether we should include any milestone payments or other forms of variable consideration in the transaction price, based on whether a significant reversal of revenue previously recognized is not probable upon resolution of the uncertainty. Since milestone payments may become payable to us upon the initiation of a clinical study, filing for or receipt of regulatory approval or the first commercial sale of a product, we review the relevant facts and circumstances to determine when we should update the transaction price, which may occur before the triggering event. When we do update the transaction price for milestone payments, we allocate it on a relative standalone selling price basis and record revenue on a cumulative catch-up basis, which results in recognizing revenue for previously satisfied performance obligations in such period. As described further in Note 11, we recognized $50.0 million of milestones in the year ended December 31, 2020 because we had previously satisfied the performance obligation. If we update the transaction price before the triggering event, we recognize the increase in the transaction price as a contract asset. Our partners generally pay development milestones subsequent to achievement of the triggering event. Research and Development Services: For amounts allocated to our research and development obligations in a collaboration arrangement, we recognize revenue over time using a proportional performance model, representing the transfer of goods or services as we perform activities over the term of the agreement.
Research and Development Expense	Research and Development Expense Research and development costs are expensed as incurred and include salaries, benefits and other operating costs such as outside services, supplies and allocated overhead costs. We perform research and development activities for our drug candidates and technology development and for certain third parties under collaboration agreements. For our drug candidates and our internal technology development programs, we invest our own funds without reimbursement from a third party. Where we perform research and development activities under a joint development collaboration, such as our collaboration with BMS, we record the cost reimbursement from our partner as a reduction to research and development expense when reimbursement amounts are due to us under the agreement. We record an accrued expense for the estimated unbilled costs of our clinical study activities performed by third parties. The financial terms of these agreements are subject to negotiation, vary from contract to contract and may result in uneven payment flows to our vendors. Payments under the contracts depend on factors such as the achievement of certain events, successful enrollment of patients and completion of certain clinical trial activities. We generally recognize costs associated with the start-up and reporting phases of the clinical trials as incurred. We generally accrue costs associated with the treatment phase of clinical trials based on the estimated activities performed by our third party vendors, including our contract research organizations. We may also accrue expenses based on the total estimated cost of the treatment phase on a per patient basis and expense the per patient cost ratably over the estimated patient treatment period. In specific circumstances, such as for certain time-based costs, we recognize clinical trial expenses ratable over the service period, as we believe that this methodology may be more reflective of the timing of costs incurred. We record an accrued expense for the estimated costs of our contract manufacturing activities performed by third parties. The financial terms of these agreements are subject to negotiation, vary from contract to contract and may result in uneven payment flows to our vendors. Payments under the contracts include upfront payments and milestone payments, which depend on factors such as the achievement of the completion of certain stages of the manufacturing process. For purposes of recognizing expense, we assess whether we consider the production process to be sufficiently defined such that the resulting product can be considered the delivery of a good, as evidenced by predictive or contractually required yields in the production process or payment terms based on the actual yield, or the delivery of a service, where processes and yields are developing and less certain. If we consider the process to be the delivery of a good, we recognize expense when the drug product is delivered, or we otherwise bear risk of loss. If we consider the process to be the delivery of a service, we recognize expense based on our best estimates of the contract manufacturer’s progress towards completion of the stages in the contracts. We recognize and amortize upfront payments and accrue liabilities based on the specific terms of each arrangement. Certain arrangements may provide upfront payments for certain stages of the arrangement and milestone payments for the completion of certain stages, and, accordingly, we may record advance payments for services that have not been completed or goods not delivered and liabilities for stages where the contract manufacturer is entitled to a milestone payment. We capitalize advance payments for goods or services that will be used or rendered for future research and development activities and recognize expense as the related goods are delivered or services performed. We base our estimates on the best information available at the time. However, additional information may become available to us in the future which may allow us to make a more accurate estimate in future periods. In this event, we may be required to record adjustments to research and development expenses in future periods when the actual level of activity becomes more certain. We generally consider such increases or decreases in cost as changes in estimates and reflect them in research and development expenses in the period identified.
Impairment of Assets and Other Costs for Terminated Program	Impairment of Assets and Other Costs for Terminated ProgramOn January 14, 2020, the joint FDA Anesthetic Drug Products Advisory Committee and Drug Safety and Risk Management Committee did not recommend approval of our NDA for NKTR-181. As a result, we withdrew our NDA and decided to make no further investments in this program. On February 26, 2020, the Audit Committee of our Board of Directors approved management’s plan for the wind-down of Inheris and the NKTR-181 program.
Stock-Based Compensation	Stock-Based Compensation Stock-based compensation arrangements include grants of stock options, restricted stock units (RSUs), performance stock units (PSUs) under our equity incentive plans, as well as shares issued under our Employee Stock Purchase Plan (ESPP), through which employees may purchase our common stock at a discount to the market price. We expense the grant date fair value of options, RSUs, PSUs and ESPP shares on a straight-line basis over the requisite service periods in our Consolidated Statements of Operations and recognize forfeitures of options, RSUs and PSUs as they occur. For options and RSUs that vest upon the achievement of performance milestones, we recognize expense provided that we believe that the performance milestones are probable of achievement, and we estimate the vesting period based on our evaluation of the estimated date of achievement of these milestones. For PSUs, we recognize expense based on the grant date fair value regardless of whether the market condition is met. Additionally, we do not adjust the expense based on the number of shares ultimately issued, which may be higher or lower than the grant amount. We report expense amounts in cost of goods sold, research and development expense, and general and administrative expense based on the function of the applicable employee. Stock-based compensation charges are non-cash charges and have no effect on our reported cash flows. We estimate the grant date fair value of our stock-based compensation awards as follows: •We use the Black-Scholes option pricing model for the respective grant to determine the estimated fair value of the option on the date of grant (grant date fair value) and the estimated fair value of common stock purchased under the ESPP. The Black-Scholes option pricing model requires the input of highly subjective assumptions, including but not limited to, our stock price volatility over the term of the awards, and actual and projected employee stock option exercise behaviors. •The number of shares issuable under PSUs is based on our total shareholder return as compared to other companies within the Nasdaq biotechnology index over the measurement period and may be capped based on our absolute total shareholder return over such period. We use the Monte Carlo simulation model to determine the estimated grant date fair value. The Monte Carlo simulation model incorporates assumptions such as the volatility of our stock, the volatility of the stock of other peer companies within the index, and the correlation of both our stock and our peer companies’ stock to the index. •The fair value of an RSU is equal to the closing price of our common stock on the grant date.
Income Taxes	Income Taxes We account for income taxes under the liability method. Under this method, we determine deferred tax assets and liabilities based on differences between the financial reporting and tax reporting bases of assets and liabilities, measured using enacted tax rates and laws that we expect to be in effect when we expect the differences to reverse. Realization of deferred tax assets is dependent upon future earnings, the timing and amount of which are uncertain. We record a valuation allowance against deferred tax assets to reduce their carrying value to an amount that is more likely than not to be realized. When we establish or reduce the valuation allowance related to the deferred tax assets, our provision for income taxes will increase or decrease, respectively, in the period we make such determination. We utilize a two-step approach to recognize and measure uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained upon tax authority examination, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount of benefit, determined on a cumulative probability basis, that is more than 50% likely of being realized upon ultimate settlement.
Net Loss Per Share	Net Loss Per Share For all periods presented in the Consolidated Statements of Operations, the net loss available to common stockholders is equal to the reported net loss. We calculate basic net loss per share based on the weighted-average number of common shares outstanding during the periods presented.
Comprehensive Loss	Comprehensive Loss Comprehensive loss is the change in stockholders’ equity from transactions and other events and circumstances other than those resulting from investments by stockholders and distributions to stockholders. Our comprehensive loss includes our net loss, gains and losses from the foreign currency translation of the assets and liabilities of our foreign subsidiaries, and unrealized gains and losses on investments in available-for-sale securities.
Recently Adopted Accounting Pronouncements And Recent Accounting Pronouncements	Recent Accounting Pronouncements We have reviewed recent accounting pronouncements and concluded they are either not applicable to us or that we do not expect adoption to have a material effect on our consolidated financial statements.

Cash and Investments in Marketable Securities - Schedule of Cash and Investments in Marketable Securities, Including Cash Equivalents (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Estimated Fair Value at
Cash and cash equivalents	$ 25,218	$ 198,955
Short-term investments	708,737	862,941
Long-term investments	64,828	136,662
Total cash and investments in marketable securities	$ 798,783	$ 1,198,558

Segment Reporting (Tables)

12 Months Ended

Dec. 31, 2021

Segment Reporting [Abstract]

Schedule of Revenue by Geographic Area

The following table sets forth revenue by geographic area (in thousands):


	Year Ended December 31,
	2021		2020		2019
United States	$	10,114	$	64,966	$	27,093
Rest of World	91,793		87,949		87,524
Total revenue	$	101,907	$	152,915	$	114,617

Cash and Investments in Marketable Securities

12 Months Ended

Dec. 31, 2021

Cash and Cash Equivalents [Abstract]

Cash, Cash Equivalents, and Marketable Securities

Cash and Investments in Marketable Securities

Cash and investments in marketable securities, including cash equivalents, are as follows (in thousands):


	Estimated Fair Value at
	December 31, 2021		December 31, 2020
Cash and cash equivalents	$	25,218	$	198,955
Short-term investments	708,737		862,941
Long-term investments	64,828		136,662
Total cash and investments in marketable securities	$	798,783	$	1,198,558

We invest in liquid, high quality debt securities. Our investments in debt securities are subject to interest rate risk. To minimize the exposure due to an adverse shift in interest rates, we invest in securities with maturities of two years or less and maintain a weighted average maturity of one year or less. All of our long-term investments as of December 31, 2021 and 2020 had maturities between one and two years.

During the year ended December 31, 2021 and 2020, we sold available-for-sale securities totaling $11.5 million and $41.7 millions, respectively. We did not sell any available-for-sale securities in the year ended December 31, 2019. Gross realized gains and losses on those sales were not significant.

We report our accrued interest receivable, which totaled $1.4 million and $5.1 million at December 31, 2021 and December 31, 2020, respectively, in other current assets on our Consolidated Balance Sheets.

Our portfolio of cash and investments in marketable securities includes (in thousands):


	Fair Value Hierarchy Level	December 31, 2021								December 31, 2020
		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Fair Value
Corporate notes and bonds	2	$	278,475	$	7	$	(361)	$	278,121	$	687,469
Corporate commercial paper	2	478,932		5		(308)		478,629		313,497
Obligations of U.S. government agencies	2	5,880		—		(5)		5,875		2,382
Available-for-sale investments		763,287		12		(674)		762,625		1,003,348
Money market funds	1							23,968		179,302
Certificates of deposit	2							10,940		9,623
Cash	N/A							1,250		6,285
Total cash and investments in marketable securities								$	798,783	$	1,198,558

At December 31, 2020, our gross unrealized gains and losses totaled $1.1 million and $0.2 million, respectively.

At both December 31, 2021 and 2020, we had letter of credit arrangements in favor of our landlords and certain vendors totaling $8.1 million. These letters of credit are secured by investments of similar amounts.

Operating Leases - Additional Information (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2021 USD ($) ft²	Dec. 31, 2020 USD ($)	Dec. 31, 2019 USD ($)
Leases [Line Items]
Operating lease expense \| $	$ 19,153	$ 18,985	$ 14,697
Operating lease, payments \| $	$ 16,800	$ 16,200	$ 8,400
Weighted average remaining lease term	8 years 1 month 6 days
Weighted average discount rate, percent	5.80%
Mission Bay Facility
Leases [Line Items]
Lease space (in sq ft) \| ft²	155,215
Third Street Facility
Leases [Line Items]
Lease space (in sq ft) \| ft²	135,936

Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Statement of Comprehensive Income [Abstract]
Net loss	$ (523,837)	$ (444,440)	$ (440,667)
Other comprehensive income (loss):
Net unrealized gain (loss) on available-for-sale investments	(1,568)	(927)	5,693
Net foreign currency translation gain (loss)	(294)	(363)	(382)
Other comprehensive income (loss)	(1,862)	(1,290)	5,311
Comprehensive loss	$ (525,699)	$ (445,730)	$ (435,356)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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+ Details

- Definition

Amount after tax and reclassification adjustments of other comprehensive income (loss).

+ References

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+ Details

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2021

Income Tax Disclosure [Abstract]

Schedule of Income Before Income Tax, Domestic and Foreign

Income (loss) before provision for income taxes includes the following components (in thousands):


	Year Ended December 31,
	2021		2020		2019
Domestic	$	(524,440)	$	(445,370)	$	(441,494)
Foreign	1,160		1,423		1,440
Loss before provision for income taxes	$	(523,280)	$	(443,947)	$	(440,054)

Schedule of Provision for Income Taxes

The provision for income taxes consists of the following (in thousands):


	Year Ended December 31,
	2021		2020		2019
Current:
Federal	$	—	$	—	$	—
State	50		165		139
Foreign	609		364		495
Total current income tax expense	659		529		634
Deferred:
Federal	—		—		—
State	—		—		—
Foreign	(102)		(36)		(21)
Total deferred income tax expense	(102)		(36)		(21)
Provision for income taxes	$	557	$	493	$	613

Schedule of Income Tax Provision Related to Continuing Operations

Our income tax provision related to continuing operations differs from the amount computed by applying the statutory income tax rate of 21% to our pretax loss as follows (in thousands):


	Year Ended December 31,
	2021		2020		2019
Income tax benefit at federal statutory rate	$	(109,889)	$	(93,229)	$	(92,411)
Research credits	(4,727)		(3,081)		(10,511)
Change in valuation allowance	97,914		87,060		104,440
Non-cash interest expense on liability related to sales of future royalties	9,936		6,356		5,259
Non-cash royalty revenue related to sales of future royalties	(7,891)		(7,967)		(7,624)
Loss on revaluation of liability related to the sale of future royalties	4,940		—		—
Stock-based compensation	6,627		7,929		(672)
Other	3,647		3,425		2,132
Provision for income taxes	$	557	$	493	$	613

Schedule of Significant Components of Deferred Tax Assets and Liabilities

We measure deferred tax assets and liabilities based on the rates at which they are expected to reverse in the future. Significant components of our deferred tax assets for federal and state income taxes are as follows (in thousands):


	December 31,
	2021		2020
Deferred tax assets:
Net operating loss carryforwards	$	564,712	$	456,284
Research and other credits	139,996		132,994
Operating lease liabilities	34,680		35,672
Stock-based compensation	33,408		32,517
Liability related to the sale of future royalties	23,757		32,737
Development derivative liability	6,639		—
Other	10,651		11,688
Deferred tax assets before valuation allowance	813,843		701,892
Valuation allowance for deferred tax assets	(785,748)		(670,103)
Total deferred tax assets	28,095		31,789
Deferred tax liabilities:
Operating lease right-of-use assets	(27,204)		(29,707)
Other	(564)		(1,856)
Total deferred tax liabilities	(27,768)		(31,563)
Net deferred tax assets	$	327	$	226

Schedule of Unrecognized Tax Benefits

We have the following activity relating to unrecognized tax benefits (in thousands):


	Year Ended December 31,
	2021		2020		2019
Beginning balance	$	78,665	$	77,410	$	27,419
Tax positions related to current year:
Additions	2,371		2,512		49,858
Reductions	—		—		—
Tax positions related to prior years:
Additions	58		193		277
Reductions	(490)		(1,450)		(144)
Settlements	—		—		—
Lapses in statute of limitations	—		—		—
Ending balance	$	80,604	$	78,665	$	77,410

Stockholders' Equity - Schedule of Shares of Common Stock Reserved for Future Issuance (Details) shares in Thousands	Dec. 31, 2021 shares
Class of Stock [Line Items]
Total common stock reserved for issuance	26,107
Share-based Payment Arrangement, Option, RSUs And PSUs
Class of Stock [Line Items]
Total common stock reserved for issuance	23,922
2017 Performance Incentive Plan
Class of Stock [Line Items]
Total common stock reserved for issuance	1,142
Employee Stock Purchase Plan
Class of Stock [Line Items]
Total common stock reserved for issuance	1,043

Property, Plant and Equipment (Tables)

12 Months Ended

Dec. 31, 2021

Property, Plant and Equipment [Abstract]

Schedule of Property, Plant and Equipment

Property, plant and equipment consists of the following (in thousands):


	December 31,
	2021		2020
Building and leasehold improvements	$	97,385	$	92,977
Laboratory equipment	42,704		40,121
Computer equipment and software	28,829		28,684
Manufacturing equipment	22,374		21,796
Furniture, fixtures, and other	10,094		9,872
Depreciable property, plant and equipment at cost	201,386		193,450
Less: accumulated depreciation	(148,039)		(138,488)
Depreciable property, plant and equipment, net	53,347		54,962
Construction-in-progress	7,163		4,700
Property, plant and equipment, net	$	60,510	$	59,662

Selected Quarterly Financial Data

12 Months Ended

Dec. 31, 2021

Quarterly Financial Information Disclosure [Abstract]

Selected Quarterly Financial Data

Selected Quarterly Financial Data (Unaudited)

The following table sets forth certain unaudited quarterly financial data. In our opinion, the unaudited information set forth below has been prepared on the same basis as our audited information and includes all adjustments necessary to present fairly the information set forth herein. We have experienced fluctuations in our quarterly results and expect these fluctuations to continue in the future. Due to these and other factors, we believe that quarter-to-quarter comparisons of our operating results will not be meaningful, and the results for any one quarter may not be indicative of our future performance. All data is in thousands except per share information.


	Year Ended December 31, 2021								Year Ended December 31, 2020
	Q1		Q2		Q3		Q4		Q1		Q2		Q3		Q4
Product sales	$	4,795	$	7,846	$	5,194	$	5,890	$	3,444	$	5,485	$	5,691	$	2,884
Total revenue	$	23,647	$	28,330	$	24,921	$	25,009	$	50,573	$	48,847	$	30,033	$	23,462
Cost of goods sold	$	5,756	$	7,667	$	5,311	$	6,163	$	3,811	$	5,773	$	5,570	$	4,323
Research and development expenses	$	95,604	$	101,313	$	103,738	$	99,614	$	108,987	$	96,436	$	100,531	$	102,724
Operating loss	$	(109,392)	$	(110,205)	$	(113,596)	$	(112,910)	$	(133,631)	$	(77,709)	$	(103,050)	$	(110,721)
Net loss	$	(122,967)	$	(125,519)	$	(129,706)	$	(145,645)	$	(138,651)	$	(80,000)	$	(108,586)	$	(117,203)
Net loss per share, basic and diluted(1)	$	(0.68)	$	(0.69)	$	(0.70)	$	(0.79)	$	(0.78)	$	(0.45)	$	(0.61)	$	(0.65)

_______________________________________________________________

(1)Quarterly loss per share amounts may not total to the year-to-date loss per share due to rounding.

Senior Secured Notes (Details) - USD ($) $ in Thousands		12 Months Ended
Senior Secured Notes (Details) - USD ($) $ in Thousands	Apr. 13, 2020	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Oct. 05, 2015
Debt Instrument [Line Items]
Principal amount repaid		$ 0	$ 250,000	$ 0
Senior Notes \| 7.75% Senior Secured Notes Due October 2020
Debt Instrument [Line Items]
Senior secured notes, principal amount					$ 250,000
Senior secured notes, interest rate					7.75%
Principal amount repaid	$ 250,000
Interest receivable	$ 4,800

Organization and Summary of Significant Accounting Policies (Details) shares in Millions	3 Months Ended								12 Months Ended
	Dec. 31, 2021 USD ($)	Sep. 30, 2021 USD ($)	Jun. 30, 2021 USD ($)	Mar. 31, 2021 USD ($)	Dec. 31, 2020 USD ($)	Sep. 30, 2020 USD ($)	Jun. 30, 2020 USD ($)	Mar. 31, 2020 USD ($)	Dec. 31, 2021 USD ($) reporting_unit shares	Dec. 31, 2020 USD ($) shares	Dec. 31, 2019 USD ($) shares
Organization And Summary Of Significant Accounting Policies [Line Items]
Cash and investments in marketable securities	$ 798,783,000				$ 1,198,558,000				$ 798,783,000	$ 1,198,558,000
Net expense reimbursements from collaboration partner									$ 21,400,000	38,700,000
Number of reporting unit evaluated for goodwill \| reporting_unit									1
Total revenue	25,009,000	$ 24,921,000	$ 28,330,000	$ 23,647,000	$ 23,462,000	$ 30,033,000	$ 48,847,000	$ 50,573,000	$ 101,907,000	152,915,000	$ 114,617,000
Purchase commitments related to contract manufacturing, clinical development and certain other items	$ 8,200,000								$ 8,200,000
BMS Collaboration Agreement
Organization And Summary Of Significant Accounting Policies [Line Items]
Sales milestone revenue										$ 50,000,000
Stock Options, RSUs and PSUs
Organization And Summary Of Significant Accounting Policies [Line Items]
Weighted average antidilutive securities excluded from computation of earnings per share (in shares) \| shares									18.4	17.4	17.9
NKTR - 181
Organization And Summary Of Significant Accounting Policies [Line Items]
Write off of prepayment								19,700,000
Purchase commitments related to contract manufacturing, clinical development and certain other items								$ 25,500,000
Non-cash royalty revenue related to the sales of future royalties
Organization And Summary Of Significant Accounting Policies [Line Items]
Total revenue									$ 77,746,000	$ 48,563,000	$ 36,303,000
Cash And NonCash Royalties
Organization And Summary Of Significant Accounting Policies [Line Items]
Total revenue									$ 77,700,000	$ 79,600,000	$ 77,500,000
Buildings
Organization And Summary Of Significant Accounting Policies [Line Items]
Property and equipment estimated useful lives									20 years
Minimum \| Manufacturing equipment
Organization And Summary Of Significant Accounting Policies [Line Items]
Property and equipment estimated useful lives									3 years
Maximum \| Manufacturing equipment
Organization And Summary Of Significant Accounting Policies [Line Items]
Property and equipment estimated useful lives									10 years

License and Collaboration Agreements

12 Months Ended

Dec. 31, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

License and Collaboration Agreements

We have entered into various collaboration agreements including license agreements and collaborative research, development and commercialization agreements with various pharmaceutical and biotechnology companies. Under these collaboration arrangements, we are entitled to receive license fees, upfront payments, milestone and other contingent payments, royalties, sales milestone payments, and payments for the manufacture and supply of our proprietary PEGylation materials and/or reimbursement for research and development activities. We generally include our costs of performing these services in research and development expense, except for costs for product sales to our collaboration partners which we include in cost of goods sold. We analyze our agreements to determine whether we should account for the agreements within the scope of ASC 808, and, if so, we analyze whether we should account for any elements under ASC 606.

In accordance with our collaboration agreements, we recognized license, collaboration and other revenue as follows (in thousands):


		Year Ended December 31,
Partner	Agreement	2021		2020		2019
Bristol-Myers Squibb	Bempegaldesleukin	$	—	$	50,000	$	—
Eli Lilly and Company	NKTR-358	—		1,259		7,019
Amgen, Inc.	Neulasta®	—		4,167		5,000
Other		436		423		4,956
License, collaboration and other revenue		$	436	$	55,849	$	16,975

As of December 31, 2021, our collaboration agreements with partners included potential future payments for development and regulatory milestones totaling approximately $1.7 billion, including amounts from our agreements with BMS and Eli Lilly and Company described below. In addition, under our collaboration agreements we are entitled to receive other contingent payments, including contingent sales milestones and royalty payments, as described below.

There have been no material changes to our collaboration agreements for the year ended December 31, 2021, except as

described below.

Bristol-Myers Squibb (BMS): Bempegaldesleukin (previously referred to as NKTR-214)

On February 13, 2018, we entered into a Strategic Collaboration Agreement (the BMS Collaboration Agreement) and a Share Purchase Agreement with BMS, both of which became effective on April 3, 2018. Pursuant to the BMS Collaboration Agreement, we and BMS are jointly developing bempegaldesleukin, including, without limitation, in combination with BMS’s Opdivo®, and other compounds of BMS, us or any third party. The parties have agreed to jointly commercialize bempegaldesleukin on a worldwide basis. We retained the right to record all worldwide sales for bempegaldesleukin. We will share global commercialization profits and losses with BMS for bempegaldesleukin, with Nektar sharing 65% and BMS sharing 35% of the net profits and losses. The parties share the internal and external development costs for bempegaldesleukin in combination regimens based on each party’s relative ownership interest in the compounds included in the regimens. In accordance with the agreement, the parties share development costs for bempegaldesleukin in combination with Opdivo®, 67.5% of costs to BMS and 32.5% to Nektar. The parties share costs for the manufacturing and joint commercialization of bempegaldesleukin, 35% of the costs to BMS and 65% to Nektar. On January 9, 2020, we and BMS entered into Amendment No. 1 (the First Amendment) to the BMS Collaboration Agreement, pursuant to which, we and BMS agreed to update the Collaboration Development Plan under which we are collaborating and developing bempegaldesleukin. BMS has the right, at its sole discretion, to terminate co-funding its share of the development costs for the adjuvant melanoma collaboration study if the metastatic melanoma collaboration study fails to meet the primary endpoint of progression free survival. If BMS exercises such right, we have the right, in our sole discretion, to continue the adjuvant melanoma study. On January 12, 2022, we and BMS entered into an Amendment No. 2 to the BMS Collaboration Agreement, pursuant to which we and BMS allocated certain responsibilities for price negotiations and promotion, market access, patient support and related activities to each party. The cost sharing for the development, manufacturing and commercialization under our collaboration remains unchanged as a result of these amendments.

Upon the effective date of the BMS Collaboration Agreement in April 2018, BMS paid us a non-refundable upfront cash payment of $1.0 billion and purchased 8,284,600 shares of our common stock pursuant to the Share Purchase Agreement for total additional cash consideration of $850.0 million. Pursuant to Amendment No. 1 described below, we received a non-refundable, creditable milestone payment of $25.0 million for the first patient, first visit in the registrational muscle-invasive bladder cancer trial, which was achieved on January 30, 2020, and also received a non-refundable, non-creditable milestone payment of $25.0 million for the first patient, first visit in the registrational adjuvant melanoma trial, which we achieved on July 27, 2020. We are eligible to receive potential future payments for development and regulatory milestones of approximately $1.4 billion (which reflects the reduction for the creditable milestone for the muscle-invasive bladder cancer trial) and up to a total of $350.0 million upon the achievement of certain sales milestones.

We determined that the BMS Collaboration Agreement falls within the scope of ASC 808. As mentioned above, BMS shares certain percentages of development costs incurred by us and we share certain percentages of development costs incurred by BMS. We consider these activities to represent collaborative activities under ASC 808 and we recognize such cost sharing proportionately with the performance of the underlying services. We recognize BMS’ reimbursement of our expenses as a reduction of research and development expense and our reimbursement of BMS’ expenses as research and development expense. For the years ended December 31, 2021, 2020 and 2019, we recorded $101.5 million, $128.2 million and $105.4 million, respectively, as a reduction of research and development expenses for BMS’ share of our expenses, net of our share of BMS’ expenses. As of December 31, 2021 and 2020, we have recorded an unbilled receivable of $21.4 million and $38.7 million, respectively, from BMS in accounts receivable in our Consolidated Balance Sheet.

Our share of development costs is limited to an annual cap of $125.0 million. To the extent this annual cap is exceeded, BMS reimburses us for the excess, which we must repay to the extent that our share of development costs are less than the annual cap in a future year. For the year-ended December 31, 2020, our share of the development costs exceeded the annual cap and therefore we included the $4.0 million reimbursement in our accounts receivable as of December 31, 2020 and recorded an off-setting liability in Other long-term liabilities. For the year-ended December 31, 2021, our share of the development costs was sufficiently lower than the cap such that we are required to repay the $4.0 million and therefore have reclassified the liability as a reduction of our accounts receivable as of December 31, 2021.

We analogized to ASC 606 for the accounting for our two performance obligations, consisting of the delivery of the licenses to develop and commercialize bempegaldesleukin and our participation on joint steering and other collaboration committees. We determined that our committee participation is not material.

During 2018, we aggregated the total consideration of $1.85 billion received under the agreements and allocated it between the stock purchase and the revenue-generating elements, because we and BMS negotiated the agreements together and

the effective date of the BMS Collaboration Agreement was dependent upon the effective date of the Share Purchase Agreement. We recorded the estimated fair value of the shares of $790.2 million in stockholders’ equity. We allocated the remaining $1,059.8 million to the transaction price of the collaboration agreement, which we recognized in 2018. During the year ended December 31, 2020, we received $50.0 million in aggregate for the achievements of the first patient, first visit in the registrational muscle-invasive bladder cancer trial and the registrational adjuvant melanoma trial, which we recognized as revenue in 2020 because we had previously satisfied our performance obligation of granting the licenses. We continue to exclude the variable consideration of the potential future development, regulatory and sales milestones of up to approximately $1.8 billion from the transaction price as of December 31, 2021 due to the significant uncertainties involved with clinical development and regulatory approval. We re-evaluate the transaction price at each reporting period and as uncertain events are resolved or other changes in circumstances occur.

Eli Lilly and Company (Lilly): NKTR-358

On July 23, 2017, we entered into a worldwide license agreement with Eli Lilly and Company (Lilly), which became effective on August 23, 2017, to co-develop NKTR-358, a novel immunological drug candidate that we invented. Under the terms of the agreement, we (i) received an initial payment of $150.0 million in September 2017 and are eligible for up to $250.0 million in additional development milestones, (ii) will co-develop NKTR-358 with Lilly, for which we were responsible for completing Phase 1 clinical development and certain drug product development and supply activities, (iii) will share with Lilly Phase 1B and 2 development costs with 75% of those costs borne by Lilly and 25% of the costs borne by us, (iv) will have the option to contribute funding to Phase 3 development on an indication-by-indication basis ranging from zero to 25% of development costs, and (v) will have the opportunity to receive a royalty rate up to the low twenties based upon our Phase 3 development cost contribution and the level of annual global product sales. Lilly will be responsible for all costs of global commercialization, and we will have an option to co-promote in the U.S. under certain conditions. A portion of the development milestones may be reduced by 50% under certain conditions, related to the final formulation of the approved product and the timing of prior approval (if any) of competitive products with a similar mechanism of action, which could reduce these milestone payments by 75% if both conditions occur.

The agreement will continue until Lilly no longer has any royalty payment obligations or, if earlier, the termination of the agreement in accordance with its terms. The agreement may be terminated by Lilly for convenience, and may also be terminated under certain other circumstances, including material breach.

We identified our license grant to Lilly, our Phase 1 clinical development obligation and our drug product development obligation as the significant performance obligations in the arrangement. Based on our estimates of the standalone selling prices of the performance obligations, we allocated the $150.0 million upfront payment as $125.9 million to the license, $17.6 million to our portion of the Phase 1 clinical development and $6.5 million to the drug product development. We recognized the $125.9 million of revenue allocated to the license upon the effective date of the license agreement in August 2017, since we determined that the license was a right to use our intellectual property, for which, as of the effective date, we had provided all necessary information to Lilly to benefit from the license and the license term had begun. We recognized revenue for our portion of the Phase 1 clinical development and drug product development through the three months ended March 31, 2020. As of December 31, 2021, we have no deferred revenue related to this agreement.

We continue to exclude the other milestones from the transaction price as of December 31, 2021 due to the significant uncertainties involved with clinical development.

Baxalta Incorporated/Takeda: Hemophilia

We are a party to an exclusive research, development, license and manufacturing and supply agreement with Baxalta Inc. (Baxalta), a subsidiary of Takeda Pharmaceutical Company Ltd. (Takeda), entered into in September 2005 to develop products designed to improve therapies for Hemophilia A patients using our PEGylation technology. Under the terms of the agreement, we are entitled to research and development funding for our active programs, which are now complete for Factor VIII, and are responsible for supplying Takeda with its requirements for our proprietary materials. Takeda is responsible for all clinical development, regulatory, and commercialization expenses. The agreement is terminable by the parties under customary conditions.

This Hemophilia A program includes ADYNOVATE®, which was approved by the FDA in November 2015 for use in adults and adolescents, aged 12 years and older, who have Hemophilia A, and is now marketed in the U.S., the European Union, and many other countries. We are entitled to royalties based on worldwide net sales of ADYNOVATE® and an sales milestone upon achievement of an annual worldwide net sales target.

In October 2017, we entered into a right to sublicense agreement with Baxalta, under which we granted to Baxalta the right to grant a nonexclusive sublicense to certain patents that were previously exclusively licensed to Baxalta under our 2005 agreement. Under the right to sublicense agreement, we are entitled to single digit royalty payments based upon net sales of the products covered under the sublicense throughout the term of the agreement. As described in Note 8, we sold our rights to receive these royalties to HCR pursuant to the 2020 Purchase and Sale Agreement.

AstraZeneca AB: MOVANTIK® (naloxegol oxalate), previously referred to as naloxegol and NKTR-118,

In September 2009, we entered into an agreement with AstraZeneca AB (AstraZeneca) under which we granted AstraZeneca a worldwide, exclusive license under our patents and other intellectual property to develop, market, and sell MOVANTIK®. AstraZeneca is responsible for all research, development and commercialization costs and related decisions for MOVANTIK®. In September 2014 and December 2014, MOVANTIK® /MOVENTIG® was approved in the US and EU, respectively. In March 2016, AstraZeneca announced that it had entered into an agreement with ProStrakan Group plc, a subsidiary of Kyowa Hakko Kirin Co. Ltd. (Kirin), granting Kirin exclusive marketing rights to MOVENTIG® in the EU, Iceland, Liechtenstein, Norway and Switzerland. In April 2020, AstraZeneca announced that it had sublicensed its global commercialization rights for MOVANTIK®, excluding Europe, Canada and Israel, to RedHill Biopharma. These sublicenses did not change our rights under the agreement with AstraZeneca, and our royalty rate, royalty term and future potential sales milestones remain unchanged.

For net sales of MOVANTIK® from AstraZeneca and RedHill Biopharma, we are entitled to significant and escalating double-digit royalty payments and sales milestones. For the net sales of MOVANTIK® under the sublicense to Kirin, we are entitled to 40% of the royalties and sales milestones received by AstraZeneca. AstraZeneca is entitled to deduct a portion of its costs for a post-marketing study required by the FDA, subject to certain limits, only through a reduction of the royalties due to us. As of December 31, 2021, our cumulative share of these costs was not significant.

As described in Note 8, we sold our rights to receive these royalties to HCR pursuant to the 2020 Purchase and Sale Agreement, and HCR will bear the cost of any reductions for the post-marketing study.

Amgen, Inc.: Neulasta®

In October 2010, we amended and restated an existing supply and license agreement by entering into a supply, dedicated suite and manufacturing guarantee agreement (the 2010 Agreement) and a license agreement with Amgen, Inc. and Amgen Manufacturing, Limited (together referred to as Amgen). Under the terms of the 2010 Agreement, we received a $50.0 million payment in the fourth quarter of 2010 in return for our guaranteeing the supply of certain quantities of our proprietary PEGylation materials to Amgen. We recognized this revenue on a straight-line basis over the ten-year term of the 2010 Agreement through September 2021.

Other

In addition, as of December 31, 2021, we have other collaboration agreements, including with our collaboration partner UCB Pharma, under which we are entitled to up to a total of $40.0 million of development milestone payments upon achievement of certain development objectives, as well as sales milestones upon achievement of annual sales targets and royalties based on net sales of commercialized products, if any. However, given the current phase of development of the potential products under these collaboration agreements, we cannot estimate the probability or timing of achieving these milestones and, therefore, have excluded all development milestones from the respective transaction prices for these agreements. As of December 31, 2021, we have deferred revenue of approximately $2.0 million related to these other collaboration agreements.

Stock-Based Compensation - Schedule of Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation	$ 94,674	$ 94,261	$ 99,795
Cost of goods sold
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation	2,779	2,825	4,294
Research and development
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation	54,821	57,116	63,224
General and administrative
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation	37,074	33,295	32,277
Impairment of assets and other costs for terminated program
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation	$ 0	$ 1,025	$ 0

Organization and Summary of Significant Accounting Policies	12 Months Ended
	Dec. 31, 2021
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization and Summary of Significant Accounting Policies	Organization and Summary of Significant Accounting Policies Organization We are a research-based biopharmaceutical company headquartered in San Francisco, California and incorporated in Delaware. We are developing a pipeline of drug candidates that utilize our advanced polymer conjugate technology platforms, which are designed to enable the development of new molecular entities that target known mechanisms of action. Our research and development pipeline of new investigational drugs includes investigational treatments for cancer, autoimmune disease and viral infections. Our research and development activities have required significant ongoing investment to date and are expected to continue to require significant investment. As a result, we expect to continue to incur substantial losses and negative cash flows from operations in the future. We have financed our operations primarily through cash generated from licensing, collaboration and manufacturing agreements and financing transactions. At December 31, 2021, we had approximately $798.8 million in cash and investments in marketable securities. Basis of Presentation, Principles of Consolidation and Use of Estimates Our Consolidated Financial statements include the financial position, results of operations and cash flows of our wholly-owned subsidiaries: Nektar Therapeutics Europe GmbH, Nektar Therapeutics (India) Private Limited (Nektar India), Inheris Biopharma, Inc. (Inheris) and certain other entities in Europe. We have eliminated all intercompany accounts and transactions in consolidation. Our Consolidated Financial Statements are denominated in U.S. dollars. Accordingly, changes in exchange rates between the applicable foreign currency and the U.S. dollar will affect the translation of each foreign subsidiary’s financial results into U.S. dollars for purposes of reporting our consolidated financial results. We include translation gains and losses in accumulated other comprehensive loss in the stockholders’ equity section of our Consolidated Balance Sheets. To date, such cumulative currency translation adjustments have not been significant to our consolidated financial position. Our comprehensive loss consists of our net loss plus our foreign currency translation gains and losses and unrealized holding gains and losses on available-for-sale securities. There were no significant reclassifications out of accumulated other comprehensive loss to the statements of operations during the years ended December 31, 2021, 2020 and 2019. The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Accounting estimates and assumptions are inherently uncertain. Actual results could differ materially from those estimates and assumptions. Our estimates include those related to the selling prices of performance obligations and amounts of variable consideration in collaboration agreements, royalty revenue, and other assumptions required for revenue recognition as described further below; the net realizable value of inventory; the impairment of investments, goodwill and long-lived assets; contingencies, accrued clinical trial, contract manufacturing and other expenses; non-cash royalty revenue and non-cash interest expense from our liabilities related to our sales of future royalties; assumptions used in the valuation of our development derivative liability as further described in Note 6; our assumptions used in stock-based compensation; and ongoing litigation, among other estimates. We base our estimates on historical experience and on other assumptions that management believes are reasonable under the circumstances. These estimates form the basis for making judgments about the carrying values of assets and liabilities when these values are not readily apparent from other sources. As appropriate, we assess estimates each period, update them to reflect current information, and will generally reflect any changes in estimates in the period first identified. Reclassifications Certain items previously reported in specific financial statement captions have been reclassified to conform to the current period presentation. Such reclassifications do not materially impact previously reported revenue, operating loss, net loss, total assets, liabilities or stockholders’ equity. Fair Value of Financial Instruments The recorded amounts of certain financial instruments, including cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate their fair values due to their relatively short maturities. Investments that are classified as available-for-sale are recorded at estimated fair value. The disclosed fair value related to our cash equivalents and investments is based on market prices from a variety of industry standard data providers and generally represent quoted prices for similar assets in active markets or have been derived from observable market data. Development derivative liability is recorded at its estimated fair value based on management′s estimates of several unobservable inputs, including the probabilities of success of ongoing clinical trials and various other inputs described above and in Note 6. The fair value of our financial assets and liabilities are determined in accordance with the fair value hierarchy established in ASC 820-10, Fair Value Measurements and Disclosures (ASC 820). ASC 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The fair value hierarchy of ASC Topic 820 requires an entity to maximize the use of observable inputs when measuring fair value and classifies those inputs into three levels: Level 1 — Quoted prices in active markets for identical assets or liabilities. Level 2 — Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices for identical or similar assets or liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. For the years ended December 31, 2021 and 2020, there were no transfers between Level 1 and Level 2 of the fair value hierarchy. Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Cash, Cash Equivalents, and Investments in Marketable Securities We consider all investments in marketable securities with an original maturity of three months or less when purchased to be cash equivalents. We classify investments in securities with remaining maturities of less than one year, or where our intent is to use the investments to fund current operations or to make them available for current operations, as short-term investments. We classify investments in securities with remaining maturities of over one year as long-term investments. Our cash and investments are held or issued by financial institutions that management believes are of high credit quality. However, they are exposed to credit risk in the event of default by the third parties that hold or issue such assets. Our investment policy limits investments to fixed income securities denominated and payable in U.S. dollars such as corporate bonds, corporate commercial paper, U.S. government obligations, and money market funds and places restrictions on maturities and concentrations by type and issuer. For our available-for-sale securities, we have significant concentrations of issuers in the banking and financial services industry. While our investment policy requires that we only invest in highly-rated securities and limit our exposure to any single issuer, the COVID-19 pandemic may materially affect the financial condition of issuers. Additionally, pursuant to our investment policy, we may sell securities before maturity if the issuer’s credit rating has been downgraded below our minimum credit rating requirements, which may result in a loss on the sale. As a result of the COVID-19 pandemic, we have seen credit downgrades for certain of our securities. Accordingly, if the COVID-19 pandemic or other factors result in downgrades below our minimum credit rating requirements and if we decide to sell these securities, we may experience losses on such sales. Investments are designated as available-for-sale and are carried at fair value with unrealized gains and losses reported in stockholders’ equity as accumulated other comprehensive income (loss). We review our portfolio of available-for-sale debt securities, using both quantitative and qualitative factors, to determine if declines in fair value below amortized cost have resulted from a credit-related loss or other factors. If the decline in fair value is due to credit-related factors, we recognize a loss in our Consolidated Statement of Operations, whereas if the decline in fair value is not due to credit-related factors, we recognize the loss in other comprehensive income (loss). We include coupon interest on securities classified as available-for-sale, as well as amortization of premiums and accretion of discounts to maturity, in interest income. The cost of securities sold is based on the specific identification method. Accounts Receivable and Significant Customer Concentrations Our customers are primarily pharmaceutical and biotechnology companies that are primarily located in the U.S. and Europe and with whom we have multi-year arrangements. Our accounts receivable balance contains billed and unbilled trade receivables from product sales, milestones (to the extent that they have been achieved and are due from the counterparty), other contingent payments, as well as reimbursable costs from collaborative research and development agreements. Our accounts receivable included $21.4 million and $38.7 million for unbilled net expense reimbursements from our collaboration partner Bristol-Myers Squibb Company (BMS) as of December 31, 2021 and December 31, 2020, respectively. The remaining accounts receivable related primarily to product sales. We perform a regular review of our partners’ credit risk and payment histories when circumstances warrant, including payments made subsequent to year-end. When appropriate, we provide for an allowance for doubtful accounts by reserving for specifically identified doubtful accounts, although historically we have not experienced credit losses from our accounts receivable. Inventory and Significant Supplier Concentrations We generally manufacture inventory upon receipt of firm purchase orders from our collaboration partners, and we may manufacture certain intermediate work-in-process materials and purchase raw materials based on purchase forecasts from our collaboration partners. Inventory includes direct materials, direct labor, and manufacturing overhead, and we determine cost on a first-in, first-out basis for raw materials and on a specific identification basis for work-in-process and finished goods. We value inventory at the lower of cost or net realizable value, and we write down defective or excess inventory to net realizable value based on historical experience or projected usage. We expense inventory related to our research and development activities when we purchase or manufacture it. Before the regulatory approval of our drug candidates, we recognize research and development expense for the manufacture of drug products that could potentially be available to support the commercial launch of our drug candidates, if approved. We are dependent on our suppliers and contract manufacturers to provide raw materials and drugs of appropriate quality and reliability and to meet applicable contract and regulatory requirements. In certain cases, we rely on single sources of supply of one or more critical materials. Consequently, in the event that supplies are delayed or interrupted for any reason, including as a result of the COVID-19 pandemic, our ability to develop and produce our drug candidates, our ability to supply comparator drugs for our clinical trials, or our ability to meet our supply obligations could be significantly impaired, which could have a material adverse effect on our business, financial condition and results of operations. Long-Lived Assets We state property, plant and equipment at cost, net of accumulated depreciation. We capitalize major improvements and expense maintenance and repairs as incurred. We generally recognize depreciation on a straight-line basis. We depreciate manufacturing, laboratory and other equipment over their estimated useful lives of generally three to ten years, depreciate buildings over the estimated useful life of generally twenty years and amortize leasehold improvements over the shorter of the estimated useful lives or the remaining term of the related lease. Goodwill represents the excess of the price paid for another entity over the fair value of the assets acquired and liabilities assumed in a business combination. We are organized in one reporting unit and evaluate the goodwill for the Company as a whole. Goodwill has an indefinite useful life and is not amortized, but instead tested for impairment at least annually in the fourth quarter of each year using an October 1 measurement date. We assess the impairment of long-lived assets whenever events or changes in business circumstances indicate that the carrying amounts of the assets may not be fully recoverable. In the case of property, plant and equipment and right-of-use assets for our leases, we determine whether there has been an impairment by comparing the carrying value of the asset to the anticipated undiscounted net cash flows associated with the asset. If such cash flows are less than the carrying value, we write down the asset to its fair value, which may be measured as anticipated discounted net cash flows associated with the asset. In the case of goodwill impairment, we compare the carrying value of the reporting unit to its fair value, which we generally measure using market capitalization for our single reporting unit. If an impairment exists, we write down goodwill such that the carrying value of the reporting units equals its fair value. Leases We determine if an arrangement contains a lease at the inception of the arrangement. Right-of-use assets represent our right to use an underlying asset for the lease term, and lease liabilities represent our obligation to make lease payments arising from the lease. We recognize operating lease right-of-use assets and liabilities at the lease commencement date based on the present value of lease payments over the expected lease term. In determining the present value of lease payments, we use our incremental borrowing rate based on the information available at the lease commencement date. We have elected the practical expedient to account for the lease and non-lease components, such as common area maintenance charges, as a single lease component for our facilities leases, and elected the short-term lease recognition exemption for our short-term leases, which allows us not to recognize lease liabilities and right-of-use assets for leases with an original term of twelve months or less. Our expected lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise any such options. We recognize lease expense for our operating leases on a straight-line basis over the expected lease term. We have elected to recognize lease incentives, such as tenant improvement allowances, at the lease commencement date as a reduction of the right-of-use asset and lease liability until paid to us by the lessor to the extent that the lease provides a specified fixed or maximum level of reimbursement and we are reasonably certain to incur reimbursable costs at least equaling such amounts. Please see Note 7 for additional information regarding our leases. Collaborative Arrangements We enter into collaboration arrangements with pharmaceutical and biotechnology collaboration partners, under which we may grant licenses to our collaboration partners to further develop and commercialize one of our drug candidates, either alone or in combination with the collaboration partners’ compounds, or grant licenses to partners to use our technology to research and develop their own drug candidates. We may also perform research, development, manufacturing and supply activities under our collaboration agreements. Consideration under these contracts may include an upfront payment, development and regulatory milestones and other contingent payments, expense reimbursements, royalties based on net sales of approved drugs, and commercial sales milestone payments. Additionally, these contracts may provide options for the customer to purchase our proprietary PEGylation materials, drug candidates or additional contract research and development services under separate contracts. When we enter into collaboration agreements, we assess whether the arrangements fall within the scope of ASC 808, Collaborative Arrangements (ASC 808) based on whether the arrangements involve joint operating activities and whether both parties have active participation in the arrangement and are exposed to significant risks and rewards of the arrangement. To the extent that the arrangement falls within the scope of ASC 808, we assess whether the payments between us and our collaboration partner fall within the scope of other accounting literature. If we conclude that payments from the collaboration partner to us represent consideration from a customer, such as license fees and contract research and development activities, we account for those payments within the scope of ASC 606, Revenue from Contracts with Customers (ASC 606). However, if we conclude that our collaboration partner is not a customer for certain activities and associated payments, such as for certain collaborative research, development, manufacturing and commercial activities, we present such payments as a reduction of research and development expense or general and administrative expense, based on where we present the underlying expense. Revenue Recognition For elements of those arrangements that we determine should be accounted for under ASC 606, we assess which activities in our collaboration agreements are performance obligations that should be accounted for separately and determine the transaction price of the arrangement, which includes the assessment of the probability of achievement of future milestones and other potential consideration. For arrangements that include multiple performance obligations, such as granting a license or performing contract research and development activities or participation on joint steering or other committees, we allocate upfront and milestone payments under a relative standalone selling price method. Accordingly, we develop assumptions that require judgment to determine the standalone selling price for each performance obligation identified in the contract. These key assumptions may include revenue forecasts, clinical development timelines and costs, discount rates and probabilities of clinical and regulatory success. Product sales Product sales are primarily derived from manufacturing and supply agreements with our customers. We have assessed our current manufacturing and supply arrangements and have generally determined that they provide the customer an option to purchase our proprietary PEGylation materials. Accordingly, we treat each purchase order as a discrete exercise of the customer’s option (i.e. a separate contract) rather than as a component of the overall arrangement. The pricing for the manufacturing and supply is generally at a fixed price and may be subject to annual producer price index (PPI) adjustments. We invoice and recognize product sales when title and risk of loss pass to the customer, which generally occurs upon shipment. Customer payments are generally due 30 days from receipt of invoice. We test our products for adherence to technical specifications before shipment; accordingly, we have not experienced any significant returns from our customers. We recognize costs related to shipping and handling of product to customers in cost of goods sold. Royalty revenue, including Non-cash royalty revenue Generally, for our collaboration arrangements that include sales-based royalties, we have granted our collaboration partner a license to our intellectual property. Pursuant to these arrangements, our collaboration partners are typically obligated to pay a royalty that is based on the net sales of their approved drugs that are sold in the countries where we have intellectual property rights covering their drugs. As of December 30, 2021, we have sold our rights to receive sales-based royalties for CIMZIA®, MIRCERA®, MOVANTIK®, ADYNOVATE® and REBINYN® as further described in Note 8. For collaboration arrangements that include sales-based royalties, we have concluded that the license is the predominant item to which the royalties relate, which include commercial milestone payments based on the level of sales. Accordingly, we recognize royalty revenue when the underlying sales occur based on our best estimates of sales of the drugs. Our aggregate royalty and non-cash royalty revenue of $77.7 million, $79.6 million and $77.5 million for the years ended December 31, 2021, 2020 and 2019, respectively, represents revenue for granting licenses for which we had satisfied in prior periods. Our partners generally pay royalties or commercial milestones after the end of the calendar quarter in accordance with contractual terms. We present commercial milestone payments within license, collaboration and other revenue. License, collaboration and other revenue License Grants: For collaboration arrangements that include a grant of a license to our intellectual property, we consider whether the license grant is distinct from the other performance obligations included in the arrangement. Generally, we would conclude that the license is distinct if the customer is able to benefit from the license with the resources available to it. For licenses that are distinct, we recognize revenues from nonrefundable, upfront payments and other consideration allocated to the license when the license term has begun and we have provided all necessary information regarding the underlying intellectual property to the customer, which generally occurs at or near the inception of the arrangement. Milestone Payments: At the inception of the arrangement and at each reporting date thereafter, we assess whether we should include any milestone payments or other forms of variable consideration in the transaction price, based on whether a significant reversal of revenue previously recognized is not probable upon resolution of the uncertainty. Since milestone payments may become payable to us upon the initiation of a clinical study, filing for or receipt of regulatory approval or the first commercial sale of a product, we review the relevant facts and circumstances to determine when we should update the transaction price, which may occur before the triggering event. When we do update the transaction price for milestone payments, we allocate it on a relative standalone selling price basis and record revenue on a cumulative catch-up basis, which results in recognizing revenue for previously satisfied performance obligations in such period. As described further in Note 11, we recognized $50.0 million of milestones in the year ended December 31, 2020 because we had previously satisfied the performance obligation. If we update the transaction price before the triggering event, we recognize the increase in the transaction price as a contract asset. Our partners generally pay development milestones subsequent to achievement of the triggering event. Research and Development Services: For amounts allocated to our research and development obligations in a collaboration arrangement, we recognize revenue over time using a proportional performance model, representing the transfer of goods or services as we perform activities over the term of the agreement. Research and Development Expense Research and development costs are expensed as incurred and include salaries, benefits and other operating costs such as outside services, supplies and allocated overhead costs. We perform research and development activities for our drug candidates and technology development and for certain third parties under collaboration agreements. For our drug candidates and our internal technology development programs, we invest our own funds without reimbursement from a third party. Where we perform research and development activities under a joint development collaboration, such as our collaboration with BMS, we record the cost reimbursement from our partner as a reduction to research and development expense when reimbursement amounts are due to us under the agreement. We record an accrued expense for the estimated unbilled costs of our clinical study activities performed by third parties. The financial terms of these agreements are subject to negotiation, vary from contract to contract and may result in uneven payment flows to our vendors. Payments under the contracts depend on factors such as the achievement of certain events, successful enrollment of patients and completion of certain clinical trial activities. We generally recognize costs associated with the start-up and reporting phases of the clinical trials as incurred. We generally accrue costs associated with the treatment phase of clinical trials based on the estimated activities performed by our third party vendors, including our contract research organizations. We may also accrue expenses based on the total estimated cost of the treatment phase on a per patient basis and expense the per patient cost ratably over the estimated patient treatment period. In specific circumstances, such as for certain time-based costs, we recognize clinical trial expenses ratable over the service period, as we believe that this methodology may be more reflective of the timing of costs incurred. We record an accrued expense for the estimated costs of our contract manufacturing activities performed by third parties. The financial terms of these agreements are subject to negotiation, vary from contract to contract and may result in uneven payment flows to our vendors. Payments under the contracts include upfront payments and milestone payments, which depend on factors such as the achievement of the completion of certain stages of the manufacturing process. For purposes of recognizing expense, we assess whether we consider the production process to be sufficiently defined such that the resulting product can be considered the delivery of a good, as evidenced by predictive or contractually required yields in the production process or payment terms based on the actual yield, or the delivery of a service, where processes and yields are developing and less certain. If we consider the process to be the delivery of a good, we recognize expense when the drug product is delivered, or we otherwise bear risk of loss. If we consider the process to be the delivery of a service, we recognize expense based on our best estimates of the contract manufacturer’s progress towards completion of the stages in the contracts. We recognize and amortize upfront payments and accrue liabilities based on the specific terms of each arrangement. Certain arrangements may provide upfront payments for certain stages of the arrangement and milestone payments for the completion of certain stages, and, accordingly, we may record advance payments for services that have not been completed or goods not delivered and liabilities for stages where the contract manufacturer is entitled to a milestone payment. We capitalize advance payments for goods or services that will be used or rendered for future research and development activities and recognize expense as the related goods are delivered or services performed. We base our estimates on the best information available at the time. However, additional information may become available to us in the future which may allow us to make a more accurate estimate in future periods. In this event, we may be required to record adjustments to research and development expenses in future periods when the actual level of activity becomes more certain. We generally consider such increases or decreases in cost as changes in estimates and reflect them in research and development expenses in the period identified. Impairment of Assets and Other Costs for Terminated Program On January 14, 2020, the joint FDA Anesthetic Drug Products Advisory Committee and Drug Safety and Risk Management Committee did not recommend approval of our NDA for NKTR-181. As a result, we withdrew our NDA and decided to make no further investments in this program. On February 26, 2020, the Audit Committee of our Board of Directors approved management’s plan for the wind-down of Inheris and the NKTR-181 program. As a result, in the three months ended March 31, 2020, we wrote off $19.7 million of advance payments to contract manufacturers for commercial batches of NKTR-181. We also incurred $25.5 million of additional costs, primarily for non-cancellable commitments to our contract manufacturers and certain severance costs. Stock-Based Compensation Stock-based compensation arrangements include grants of stock options, restricted stock units (RSUs), performance stock units (PSUs) under our equity incentive plans, as well as shares issued under our Employee Stock Purchase Plan (ESPP), through which employees may purchase our common stock at a discount to the market price. We expense the grant date fair value of options, RSUs, PSUs and ESPP shares on a straight-line basis over the requisite service periods in our Consolidated Statements of Operations and recognize forfeitures of options, RSUs and PSUs as they occur. For options and RSUs that vest upon the achievement of performance milestones, we recognize expense provided that we believe that the performance milestones are probable of achievement, and we estimate the vesting period based on our evaluation of the estimated date of achievement of these milestones. For PSUs, we recognize expense based on the grant date fair value regardless of whether the market condition is met. Additionally, we do not adjust the expense based on the number of shares ultimately issued, which may be higher or lower than the grant amount. We report expense amounts in cost of goods sold, research and development expense, and general and administrative expense based on the function of the applicable employee. Stock-based compensation charges are non-cash charges and have no effect on our reported cash flows. We estimate the grant date fair value of our stock-based compensation awards as follows: •We use the Black-Scholes option pricing model for the respective grant to determine the estimated fair value of the option on the date of grant (grant date fair value) and the estimated fair value of common stock purchased under the ESPP. The Black-Scholes option pricing model requires the input of highly subjective assumptions, including but not limited to, our stock price volatility over the term of the awards, and actual and projected employee stock option exercise behaviors. •The number of shares issuable under PSUs is based on our total shareholder return as compared to other companies within the Nasdaq biotechnology index over the measurement period and may be capped based on our absolute total shareholder return over such period. We use the Monte Carlo simulation model to determine the estimated grant date fair value. The Monte Carlo simulation model incorporates assumptions such as the volatility of our stock, the volatility of the stock of other peer companies within the index, and the correlation of both our stock and our peer companies’ stock to the index. •The fair value of an RSU is equal to the closing price of our common stock on the grant date. Income Taxes We account for income taxes under the liability method. Under this method, we determine deferred tax assets and liabilities based on differences between the financial reporting and tax reporting bases of assets and liabilities, measured using enacted tax rates and laws that we expect to be in effect when we expect the differences to reverse. Realization of deferred tax assets is dependent upon future earnings, the timing and amount of which are uncertain. We record a valuation allowance against deferred tax assets to reduce their carrying value to an amount that is more likely than not to be realized. When we establish or reduce the valuation allowance related to the deferred tax assets, our provision for income taxes will increase or decrease, respectively, in the period we make such determination. We utilize a two-step approach to recognize and measure uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained upon tax authority examination, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount of benefit, determined on a cumulative probability basis, that is more than 50% likely of being realized upon ultimate settlement. Net Loss Per Share For all periods presented in the Consolidated Statements of Operations, the net loss available to common stockholders is equal to the reported net loss. We calculate basic net loss per share based on the weighted-average number of common shares outstanding during the periods presented. For the years ended December 31, 2021, 2020 and 2019, basic and diluted net loss per share are the same due to our net losses and the requirement to exclude potentially dilutive securities which would have an antidilutive effect on net loss per share. We excluded weighted average outstanding stock options, RSUs and PSUs totaling 18.4 million, 17.4 million and 17.9 million for the years ended December 31, 2021, 2020 and 2019, respectively. Comprehensive Loss Comprehensive loss is the change in stockholders’ equity from transactions and other events and circumstances other than those resulting from investments by stockholders and distributions to stockholders. Our comprehensive loss includes our net loss, gains and losses from the foreign currency translation of the assets and liabilities of our foreign subsidiaries, and unrealized gains and losses on investments in available-for-sale securities. Recent Accounting Pronouncements We have reviewed recent accounting pronouncements and concluded they are either not applicable to us or that we do not expect adoption to have a material effect on our consolidated financial statements.

Cash and Investments in Marketable Securities (Tables)

12 Months Ended

Dec. 31, 2021

Cash and Cash Equivalents [Abstract]

Schedule of Cash and Investments in Marketable Securities, Including Cash Equivalents

Cash and investments in marketable securities, including cash equivalents, are as follows (in thousands):


	Estimated Fair Value at
	December 31, 2021		December 31, 2020
Cash and cash equivalents	$	25,218	$	198,955
Short-term investments	708,737		862,941
Long-term investments	64,828		136,662
Total cash and investments in marketable securities	$	798,783	$	1,198,558

Schedule of Portfolio of Cash and Investments in Marketable Securities

Our portfolio of cash and investments in marketable securities includes (in thousands):


	Fair Value Hierarchy Level	December 31, 2021								December 31, 2020
		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Fair Value
Corporate notes and bonds	2	$	278,475	$	7	$	(361)	$	278,121	$	687,469
Corporate commercial paper	2	478,932		5		(308)		478,629		313,497
Obligations of U.S. government agencies	2	5,880		—		(5)		5,875		2,382
Available-for-sale investments		763,287		12		(674)		762,625		1,003,348
Money market funds	1							23,968		179,302
Certificates of deposit	2							10,940		9,623
Cash	N/A							1,250		6,285
Total cash and investments in marketable securities								$	798,783	$	1,198,558

Commitments and Contingencies (Details)	12 Months Ended
Commitments and Contingencies (Details)	Dec. 31, 2021 USD ($) action	Dec. 31, 2020 USD ($)	Dec. 31, 2019 USD ($)
Loss Contingencies [Line Items]
Purchase commitments related to contract manufacturing, clinical development and certain other items	$ 8,200,000
Mulquin Action And Damiba Action
Loss Contingencies [Line Items]
Previous claims \| action	2
Derivative Action
Loss Contingencies [Line Items]
New claims \| action	3
Legal Matters
Loss Contingencies [Line Items]
Litigation matters, liabilities	$ 0		$ 0
Indemnification Obligation
Loss Contingencies [Line Items]
Litigation matters, liabilities	0	$ 0
Merger and Acquisition Related Claims \| Maximum
Loss Contingencies [Line Items]
Obligations under Director and Officer Indemnifications per incident	10,000,000
Securities Related Claims
Loss Contingencies [Line Items]
Obligations under Director and Officer Indemnifications per incident	10,000,000
Non-Securities Related Claims
Loss Contingencies [Line Items]
Obligations under Director and Officer Indemnifications per incident	$ 10,000,000

Stockholders' Equity (Tables)

12 Months Ended

Dec. 31, 2021

Equity [Abstract]

Schedule of Shares of Common Stock Reserved for Future Issuance

As of December 31, 2021, shares of common stock reserved for future issuance are as follows (in thousands):


Stock options, RSUs and PSUs outstanding			23,922
Shares available for future grant under the 2017 Performance Incentive Plan			1,142
Shares available for issuance under the employee stock purchase plan			1,043
Total common stock reserved for issuance			26,107

The following table lists the Black-Scholes option-pricing model assumptions used to calculate the fair value of employee and director stock options, as well as the resulting grant-date fair value:


	Year Ended December 31,
	2021			2020			2019
Average risk-free interest rate	1.2		%	0.4		%	1.8		%
Dividend yield	0.0		%	0.0		%	0.0		%
Average volatility factor	63.8		%	64.1		%	62.2		%
Weighted-average expected life	5.5 years			5.6 years			5.6 years
Weighted-average grant-date fair value of options granted	$	8.07		$	10.70		$	12.25

Operating Leases - Schedule of Lease Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Leases [Abstract]
Operating lease expense	$ 19,153	$ 18,985	$ 14,697
Variable lease expense	8,974	8,179	6,408
Total lease expense	$ 28,127	$ 27,164	$ 21,105

Co-Development Agreement with SFJ Pharmaceuticals and Development Derivative Liability

12 Months Ended

Dec. 31, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Co-Development Agreement with SFJ Pharmaceuticals and Development Derivative Liability

On February 12, 2021, we entered into a co-development agreement (the SFJ Agreement) with SFJ Pharmaceuticals XII, L.P., a SFJ Pharmaceuticals Group company (SFJ), pursuant to which SFJ will pay up to $150.0 million in committed funding to support a Phase 2/3 study of bempegaldesleukin in combination with Keytruda® (pembrolizumab) for first-line treatment of patients with metastatic or unresectable recurrent squamous cell carcinoma of the head and neck (the SCCHN Clinical Trial) whose tumors express PD-L1 (the SCCHN Indication). SFJ Pharmaceuticals is a global drug development company backed by Blackstone Life Sciences and Abingworth. On February 11, 2021, we entered into a collaboration agreement with MSD International GmbH (MSD), an affiliate of Merck, Sharp & Dohme, pursuant to which MSD will provide Keytruda® at no cost for use in the SCCHN Clinical Trial but will not bear any other costs of the trial.

SFJ will have primary responsibility for the clinical trial management of the SCCHN Clinical Trial, and we will be the sponsor of the SCCHN Clinical Trial and will also have sole responsibility for regulatory interactions and filings for bempegaldesleukin.

Other than the opportunity to receive Success Payments as outlined below, SFJ has no right to reimbursement of costs incurred by SFJ for the SCCHN Clinical Trial in the event that the Melanoma Clinical Trial and the SCCHN Clinical Trial do not achieve FDA approval. We will pay SFJ a series of success-based annual payments (collectively, the Success Payments) in the event of FDA approval of bempegaldesleukin for the Melanoma Indication, the SCCHN Indication, or both, and in the event of FDA approval of one additional bempegaldesleukin indication. The Success Payments do not begin until the substantial completion of the SCCHN Clinical Trial. The total success-based annual payments for the first indication approved by FDA, whether for the Melanoma Indication or the SCCHN Indication, is an aggregate of $450.0 million, paid in annual contractual payments over five years, with the first payment being $30.0 million, with the earliest possible payment expected to occur in late 2024 or early 2025, subject to the substantial completion of the SCCHN Clinical Trial. The total success-based payments for the second indication approved by FDA, whether for the Melanoma Indication or the SCCHN Indication, is an aggregate of $150.0 million, paid in annual contractual payments over seven years. Finally, in the event of FDA approval for

bempegaldesleukin for any indication other than the Melanoma Indication or the SCCHN Indication, we will make a one-time payment of $37.5 million to SFJ.

The SCCHN Clinical Trial provides for an interim futility analysis, and unless the futility criteria are met, SFJ is required to complete the SCCHN Trial, but if the futility criteria are met, SFJ has the responsibility to wind down the SCCHN Clinical Trial at its sole cost. We and BMS, pursuant to the BMS Collaboration Agreement, remain solely responsible for conducting the Phase 3 clinical trials of bempegaldesleukin in combination with Opdivo®, including the treatment of previously untreated unresectable or metastatic melanoma (the “Melanoma Indication” and the “Melanoma Clinical Trial”). If the success criterion for the interim futility analysis is not met and SFJ winds down the SCCHN Clinical Trial, then the Success Payments, if any, for the Melanoma Indication and/or the additional bempegaldesleukin indication are reduced pro rata based on the costs incurred by SFJ for the SCCHN Clinical Trial over the aggregate commitment of $150.0 million.

The SFJ Agreement provides for certain positive and negative covenants, including restrictions on our ability to incur liens on our intellectual property related to bempegaldesleukin (the bempegaldesleukin IP), or assign or convey any right to receive income with respect to the bempegaldesleukin IP (other than royalty and other license fee obligations to licensors), except for the issuance of senior secured debt secured by all or substantially all of our assets, including the bempegaldesleukin IP.

The SFJ Agreement expires upon the payment of all Success Payments to SFJ, unless earlier terminated as provided under the SFJ Agreement. The SFJ Agreement may be terminated by either party for a safety or health concern for the patients, whether by the independent data monitoring committee or by mutual agreement of both parties. The SFJ Agreement may also be terminated by either party for material breach or insolvency of the counterparty.

We present the SFJ Agreement as a Development derivative liability in our Consolidated Balance Sheets, which we remeasure to fair value at each reporting date. As SFJ conducts the SCCHN Clinical Trial, we record non-cash research and development expense with a corresponding increase to the development derivative liability, and as SFJ remits funding to us to support our internal costs of conducting the trial, we also record a corresponding increase to the development derivative liability. We present the gain (loss) from the remeasurement as Change in fair value of development derivative liability in our Consolidated Statements of Operations. The following table presents the changes in the development derivative liability for the year ended December 31, 2021:


	Fair Value Hierarchy Level	Year ended December 31, 2021
Fair value at inception on February 12, 2021	3	$	—
Non-cash research and development expense		$	16,703
Cash receipts from SFJ		$	3,000
Change in the fair value of development derivative liability		$	8,023
Fair value at end of period	3	$	27,726

We valued the derivative using a scenario-based discounted cash flow method, whereby each scenario makes assumptions about the probability and timing of cash flows, and we discount such cash flows to present value using a risk-adjusted rate. The key inputs to the valuation include our estimates of the following: (i) the probability of the Melanoma Clinical Trial, the SCCHN Clinical Trial and another bempegaldesleukin trial meeting their primary endpoints, (ii) the probability and timing of achieving FDA approval in the Melanoma Indication, the SCCHN Indication and any other bempegaldesleukin indication, (iii) the timing of the substantial completion of the SCCHN Clinical Trial that SFJ must achieve before receiving a Success Payment, (iv) the probability of termination of the study due to meeting the interim futility criteria, (v) the amount of costs incurred by SFJ if the success criterion for the interim futility analysis is not met, (vi) SFJ’s cost of borrowing, currently estimated at 1.5%, and (vii) the Company’s imputed cost of borrowing for debt with similar terms, currently estimated at 12.7%.

Commitments and Contingencies	12 Months Ended
Commitments and Contingencies	Dec. 31, 2021
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies Purchase Commitments In the normal course of business, we enter into various firm purchase commitments related to contract manufacturing, clinical development and certain other items. As of December 31, 2021, these commitments were approximately $8.2 million, all of which we expect to pay in 2022. Legal Matters From time to time, we are involved in lawsuits, arbitrations, claims, investigations and proceedings, consisting of intellectual property, commercial, employment and other matters, which arise in the ordinary course of business. We make provisions for liabilities when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Such provisions are reviewed at least quarterly and adjusted to reflect the impact of settlement negotiations, judicial and administrative rulings, advice of legal counsel, and other information and events pertaining to a particular case. Litigation is inherently unpredictable. If any unfavorable ruling were to occur in any specific period, there exists the possibility of a material adverse impact on the results of our operations for that period and on our cash flows and liquidity. In October 2018, we and certain of our executives were named in a putative securities class action complaint filed in the U.S. District Court for the Northern District of California (Case No. 18-cv-06607, which we refer to as the Mulquin action). The Mulquin plaintiffs have challenged public statements Nektar made, between January 2017 and June 2018, about the clinical trials of bempegaldesleukin. The Mulquin complaint was amended in May 2019. The defendants moved to dismiss and the court granted the motion without prejudice in July 2020. The Mulquin plaintiffs again amended their complaint and the defendants again moved to dismiss. In December 2020, the court dismissed the action with prejudice. The plaintiffs filed a notice of appeal in January 2021 and appellate briefing in the U.S. Court of Appeals for the Ninth Circuit was completed in September 2021. Oral argument occurred on December 10, 2021, and the matter remains pending with the court. A second putative securities class action was filed against the Company and certain of our executives in the U.S. District Court for the Northern District of California in August 2019 (Case No. 4-19-cv-05173, which we refer to as the Damiba action). The Damiba plaintiffs challenged public statements Nektar made, between February 2019 and May 2019, about its bempegaldesleukin clinical trials and collaboration with Bristol-Myers Squibb. After the Damiba plaintiffs filed an amended complaint and the defendants moved to dismiss, the court dismissed the action without prejudice in January 2021. The Damiba plaintiffs subsequently voluntarily dismissed the action, with prejudice, in March 2021. In addition to the two securities actions (the Mulquin action and the Damiba action), three additional sets of derivative actions have been filed against certain of the Company’s current and former officers and directors, purportedly on the Company’s behalf. These derivative actions are based on the allegations in the securities actions and on the premise that the Company’s officers and directors breached their fiduciary duties by exposing the Company to one or both of the securities actions. The first derivative action was filed in the U.S. District Court for the District of Delaware in February 2019 (Case No. 1:19-cv-00322-MN-JLH). After amending their complaint several times, the plaintiffs in that action voluntarily dismissed their claims without prejudice in April 2021. A second set of derivative actions was filed in February 2020 in the U.S. District Court for the Northern District of California (Case No. 4:20-cv-01088-JSW). The derivative actions in California were consolidated and the Company moved to dismiss on the basis that the plaintiffs had neither made a demand on the Company’s board of directors nor shown that a demand would be futile. On September 1, 2021, the court dismissed the action with prejudice. A third derivative complaint was filed in February 2021 in the Court of Chancery of the State of Delaware (C.A. No. 2021-0118-PAF). The parties agreed to stay further proceedings in this action until thirty days after the U.S. Court of Appeals for the Ninth Circuit’s final resolution of the appeal in the Mulquin action. Given the nature and status of these securities class action lawsuits and derivative complaints, we cannot reasonably estimate a potential future loss or a range of potential future losses. However, an unfavorable resolution could potentially have a material adverse effect on our business, financial condition, and results of operations or prospects, and potentially result in paying monetary damages. We have recorded no liability for these matters in our Consolidated Balance Sheets at either December 31, 2021 or December 31, 2020. Foreign Operations We operate in a number of foreign countries. As a result, we are subject to numerous local laws and regulations that can result in claims made by foreign government agencies or other third parties that are often difficult to predict even after the application of good faith compliance efforts. Indemnification Obligations During the course of our normal operating activities, we have agreed to certain contingent indemnification obligations as further described below. The term of our indemnification obligations is generally perpetual. There is generally no limitation on the potential amount of future payments we could be required to make under these indemnification obligations. To date, we have not incurred significant costs to defend lawsuits or settle claims based on our indemnification obligations. If any of our indemnification obligations is triggered, we may incur substantial liabilities. Because the aggregate amount of any potential indemnification obligation is not a stated amount, we cannot reasonably estimate the overall maximum amount of any such obligations. We have recorded no liabilities for these obligations in our Consolidated Balance Sheets at either December 31, 2021 or December 31, 2020. Indemnifications in Connection with Commercial Agreements As part of our collaboration agreements with our partners related to the license, development, manufacture and supply of drugs and PEGylation materials based on our proprietary technologies and drug candidates, we generally agree to defend, indemnify and hold harmless our partners from and against third party liabilities arising out of the agreement, including product liability (with respect to our activities) and infringement of intellectual property to the extent the intellectual property is developed by us and licensed to our partners. The term of these indemnification obligations is generally perpetual commencing after execution of the agreement. There is generally no limitation on the potential amount of future payments we could be required to make under these indemnification obligations. From time to time, we enter into other strategic agreements such as divestitures and financing transactions pursuant to which we are required to make representations and warranties and undertake to perform or comply with certain covenants. For example, we made certain intellectual property representations in connection with our RPI and HCR transactions, however, the time limitation we have to indemnify RPI with respect to any breach of these intellectual property-based representations and warranties has passed. In the event it is determined that we breached certain of the representations and warranties or covenants made by us in any such agreements or certain express indemnification provisions are applicable, we could incur substantial indemnification liabilities depending on the timing, nature, and amount of any such claims. To date, we have not incurred any costs to defend lawsuits or settle claims related to these indemnification obligations, nor any breaches of representations or warranties or covenants. Because the aggregate amount of any potential indemnification obligation is not a stated amount, we cannot reasonably estimate the overall maximum amount of any such obligations. Indemnification of Underwriters and Initial Purchasers of our Securities In connection with our sale of equity we have agreed to defend, indemnify and hold harmless our underwriters or initial purchasers, as applicable, as well as certain related parties from and against certain liabilities, including liabilities under the Securities Act of 1933, as amended. Director and Officer Indemnifications As permitted under Delaware law, and as set forth in our Certificate of Incorporation and our Bylaws, we indemnify our directors, executive officers, other officers, employees, and other agents for certain events or occurrences that may arise while in such capacity. The maximum potential amount of future payments we could be required to make under this indemnification is unlimited; however, we have insurance policies that may limit our exposure and may enable us to recover a portion of any future amounts paid. Assuming the applicability of coverage, the willingness of the insurer to assume coverage, and subject to certain retention, loss limits and other policy provisions, we believe any obligations under this indemnification would not be material, other than retention of up to $10.0 million per incident for merger and acquisition related claims, $10.0 million per incident for securities related claims and $10.0 million per incident for non-securities related claims per our insurance policy. However, no assurances can be given that the covering insurers will not attempt to dispute the validity, applicability, or amount of coverage without expensive litigation against these insurers, in which case we may incur substantial liabilities as a result of these indemnification obligations.

Co-Development Agreement with SFJ Pharmaceuticals and Development Derivative Liability (Tables)

12 Months Ended

Dec. 31, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Derivative Liabilities at Fair Value

The following table presents the changes in the development derivative liability for the year ended December 31, 2021:


	Fair Value Hierarchy Level	Year ended December 31, 2021
Fair value at inception on February 12, 2021	3	$	—
Non-cash research and development expense		$	16,703
Cash receipts from SFJ		$	3,000
Change in the fair value of development derivative liability		$	8,023
Fair value at end of period	3	$	27,726

Property, Plant and Equipment

12 Months Ended

Dec. 31, 2021

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment

Property, plant and equipment consists of the following (in thousands):


	December 31,
	2021		2020
Building and leasehold improvements	$	97,385	$	92,977
Laboratory equipment	42,704		40,121
Computer equipment and software	28,829		28,684
Manufacturing equipment	22,374		21,796
Furniture, fixtures, and other	10,094		9,872
Depreciable property, plant and equipment at cost	201,386		193,450
Less: accumulated depreciation	(148,039)		(138,488)
Depreciable property, plant and equipment, net	53,347		54,962
Construction-in-progress	7,163		4,700
Property, plant and equipment, net	$	60,510	$	59,662

Building and leasehold improvements include our manufacturing, research and development and administrative facilities and the related improvements to these facilities. Laboratory and manufacturing equipment include assets that support both our manufacturing and research and development efforts. Construction-in-progress includes assets being built to enhance our manufacturing and research and development efforts.

Depreciation and amortization expense for property, plant and equipment for the years ended December 31, 2021, 2020, and 2019 was $13.0 million, $12.5 million, and $11.0 million, respectively.

Senior Secured Notes	12 Months Ended
Senior Secured Notes	Dec. 31, 2021
Debt Disclosure [Abstract]
Senior Secured Notes	Senior Secured Notes On October 5, 2015, we completed the sale and issuance of $250.0 million in aggregate principal amount of 7.75% senior secured notes due 2020 (the Notes). The Notes bore interest at a rate of 7.75% per annum and were to mature on October 5, 2020. On April 13, 2020, we redeemed the Notes at par and therefore repaid the principal of $250.0 million and accrued interest of $4.8 million.

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Current assets:
Cash and cash equivalents	$ 25,218	$ 198,955
Short-term investments	708,737	862,941
Accounts receivable	22,492	38,889
Inventory	15,801	15,292
Other current assets	23,333	21,928
Total current assets	795,581	1,138,005
Long-term investments	64,828	136,662
Property, plant and equipment, net	60,510	59,662
Operating lease right-of-use assets	117,025	126,476
Goodwill	76,501	76,501
Other assets	2,744	1,461
Total assets	1,117,189	1,538,767
Current liabilities:
Accounts payable	9,747	22,139
Accrued compensation	15,735	14,532
Accrued clinical trial expenses	26,809	44,207
Other accrued expenses	15,468	20,986
Operating lease liabilities, current portion	17,441	13,915
Total current liabilities	85,200	115,779
Operating lease liabilities, less current portion	125,736	136,373
Development derivative liability	27,726	0
Liabilities related to the sales of future royalties, net	195,427	200,340
Other long-term liabilities	3,592	8,980
Total liabilities	437,681	461,472
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $0.0001 par value; 10,000 shares authorized; no shares designated, issued or outstanding at December 31, 2021 or 2020	0	0
Common stock, $0.0001 par value; 300,000 shares authorized; 185,468 shares and 180,091 shares issued and outstanding at December 31, 2021 and 2020, respectively	19	18
Capital in excess of par value	3,516,641	3,388,730
Accumulated other comprehensive loss	(4,157)	(2,295)
Accumulated deficit	(2,832,995)	(2,309,158)
Total stockholders’ equity	679,508	1,077,295
Total liabilities and stockholders’ equity	$ 1,117,189	$ 1,538,767

Liabilities Related to the Sales of Future Royalties - Schedule of Liability Related to Potential Future Royalties (Detail) - USD ($) $ in Thousands	12 Months Ended				118 Months Ended
	Dec. 31, 2021	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2021
Liability Related To Sale Of Future Royalties [Roll Forward]
Liabilities related to the sales of future royalties—beginning balance		$ 205,255			$ 0
Royalty monetization proceeds		0			274,000
Non-cash royalty revenue		(77,746)	$ (48,563)	$ (36,303)	(333,451)
Non-cash interest expense		47,313	30,267	$ 25,044	244,273
Payments to RPI		0			(10,000)
Loss on revaluation of liability related to the sale of future royalties		(23,522)			(23,522)
Liabilities related to the sales of future royalties – ending balance	$ 198,344	198,344	205,255		198,344
Less: unamortized transaction costs	(2,917)	(2,917)			(2,917)
Liabilities related to the sales of future royalties, net	195,427	195,427	200,340		195,427
2012 Purchase and Sale Agreement
Liability Related To Sale Of Future Royalties [Roll Forward]
Liabilities related to the sales of future royalties—beginning balance		65,880			0
Royalty monetization proceeds		0			124,000
Non-cash royalty revenue		(37,578)			(282,658)
Non-cash interest expense		26,458			223,418
Payments to RPI		0			(10,000)
Loss on revaluation of liability related to the sale of future royalties		(23,522)			(23,522)
Liabilities related to the sales of future royalties – ending balance	78,282	78,282	65,880		78,282
Less: unamortized transaction costs	0	0			0
Liabilities related to the sales of future royalties, net	78,282	78,282			78,282
2020 Purchase and Sale Agreement
Liability Related To Sale Of Future Royalties [Roll Forward]
Liabilities related to the sales of future royalties—beginning balance	0	139,375
Royalty monetization proceeds	150,000	0
Non-cash royalty revenue	(50,793)	(40,168)
Non-cash interest expense	20,855	20,855
Payments to RPI	0	0
Loss on revaluation of liability related to the sale of future royalties	0
Liabilities related to the sales of future royalties – ending balance	120,062	120,062	$ 139,375		120,062
Less: unamortized transaction costs	(2,917)	(2,917)			(2,917)
Liabilities related to the sales of future royalties, net	$ 117,145	$ 117,145			$ 117,145

Stockholders' Equity - Additional Information (Details) - USD ($)	Apr. 03, 2018	Dec. 31, 2021
Class of Stock [Line Items]
Stock issued during period subject to lock-up and stand-still provisions period	5 years
Aggregate offering price		$ 300,000,000
Common Stock
Class of Stock [Line Items]
Sale of stock to Bristol-Myers Squibb (in shares)	8,284,600

Stock-Based Compensation - Schedule of Black-Scholes Option-Pricing Model Assumptions Used to Calculate Fair Value of Employee Stock Options (Details) - $ / shares	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Share-based Payment Arrangement [Abstract]
Average risk-free interest rate	1.20%	0.40%	1.80%
Dividend yield	0.00%	0.00%	0.00%
Average volatility factor	63.80%	64.10%	62.20%
Weighted-average expected life	5 years 6 months	5 years 7 months 6 days	5 years 7 months 6 days
Weighted-average grant-date fair value of options granted (in dollars per share)	$ 8.07	$ 10.70	$ 12.25

Income Taxes - Schedule of Provision for Income Taxes (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Current:
Federal	$ 0	$ 0	$ 0
State	50	165	139
Foreign	609	364	495
Total current income tax expense	659	529	634
Deferred:
Federal	0	0	0
State	0	0	0
Foreign	(102)	(36)	(21)
Total deferred income tax expense	(102)	(36)	(21)
Provision for income taxes	$ 557	$ 493	$ 613

Consolidated Balance Sheets (Parenthetical) - $ / shares	Dec. 31, 2021	Dec. 31, 2020
Statement of Financial Position [Abstract]
Preferred stock, par value (in usd per share)	$ 0.0001	$ 0.0001
Preferred stock, shares authorized (in shares)	10,000,000	10,000,000
Preferred stock, shares designated (in shares)	0	0
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common stock, par value (in usd per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized (in shares)	300,000,000	300,000,000
Common stock, shares issued (in shares)	185,468,000	180,091,000
Common stock, shares outstanding (in shares)	185,468,000	180,091,000

Selected Quarterly Financial Data (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2021	Sep. 30, 2021	Jun. 30, 2021	Mar. 31, 2021	Dec. 31, 2020	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Selected Quarterly Financial Data [Line Items]
Total revenue	$ 25,009	$ 24,921	$ 28,330	$ 23,647	$ 23,462	$ 30,033	$ 48,847	$ 50,573	$ 101,907	$ 152,915	$ 114,617
Cost of goods sold	6,163	5,311	7,667	5,756	4,323	5,570	5,773	3,811	24,897	19,477	21,374
Research and development expenses	99,614	103,738	101,313	95,604	102,724	100,531	96,436	108,987	400,269	408,678	434,566
Operating loss	(112,910)	(113,596)	(110,205)	(109,392)	(110,721)	(103,050)	(77,709)	(133,631)	(446,103)	(425,111)	(440,035)
Net loss	$ (145,645)	$ (129,706)	$ (125,519)	$ (122,967)	$ (117,203)	$ (108,586)	$ (80,000)	$ (138,651)	$ (523,837)	$ (444,440)	$ (440,667)
Net loss per share
Basic ( in dollars per share)	$ (790)	$ (700)	$ (690)	$ (680)	$ (0.65)	$ (0.61)	$ (0.45)	$ (0.78)	$ (2.86)	$ (2.49)	$ (2.52)
Diluted (in dollars per share)	$ (790)	$ (700)	$ (690)	$ (680)	$ (0.65)	$ (0.61)	$ (0.45)	$ (0.78)	$ (2.86)	$ (2.49)	$ (2.52)
Product sales
Selected Quarterly Financial Data [Line Items]
Total revenue	$ 5,890	$ 5,194	$ 7,846	$ 4,795	$ 2,884	$ 5,691	$ 5,485	$ 3,444	$ 23,725	$ 17,504	$ 20,117

Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Revenue:
Total revenue	$ 101,907	$ 152,915	$ 114,617
Operating costs and expenses:
Cost of goods sold	24,897	19,477	21,374
Research and development	400,269	408,678	434,566
General and administrative	122,844	104,682	98,712
Impairment of assets and other costs for terminated program	0	45,189	0
Total operating costs and expenses	548,010	578,026	554,652
Loss from operations	(446,103)	(425,111)	(440,035)
Non-operating income (expense):
Change in fair value of development derivative liability	(8,023)	0	0
Non-cash interest expense on liabilities related to the sales of future royalties	(47,313)	(30,267)	(25,044)
Loss on revaluation of liability related to the sale of future royalties	(24,410)	0	0
Interest income and other income (expense), net	2,569	18,282	46,335
Interest expense	0	(6,851)	(21,310)
Total non-operating expense, net	(77,177)	(18,836)	(19)
Loss before provision for income taxes	(523,280)	(443,947)	(440,054)
Provision for income taxes	557	493	613
Net loss	$ (523,837)	$ (444,440)	$ (440,667)
Net loss per share
Basic ( in dollars per share)	$ (2.86)	$ (2.49)	$ (2.52)
Diluted (in dollars per share)	$ (2.86)	$ (2.49)	$ (2.52)
Weighted average shares outstanding used in computing net loss per share
Basic (in shares)	183,298	178,581	174,993
Diluted (in shares)	183,298	178,581	174,993
Product sales
Revenue:
Total revenue	$ 23,725	$ 17,504	$ 20,117
Royalty revenue
Revenue:
Total revenue	0	30,999	41,222
Non-cash royalty revenue related to the sales of future royalties
Revenue:
Total revenue	77,746	48,563	36,303
License, collaboration and other revenue
Revenue:
Total revenue	$ 436	$ 55,849	$ 16,975

Stockholders' Equity

12 Months Ended

Dec. 31, 2021

Equity [Abstract]

Stockholders' Equity

Stockholders’ Equity

As discussed in Note 11, on April 3, 2018, we completed the issuance and sale of 8,284,600 shares of our common stock under a Share Purchase Agreement with BMS. These shares are unregistered and subject to certain lock-up and stand-still provisions for a five-year period.

We currently have an effective shelf registration statement on Form S-3 (the 2021 Shelf Registration Statement) on file with the SEC, which expires in March 2024. The 2021 Shelf Registration Statement currently permits the offering, issuance and sale by us of up to an aggregate offering price of $300.0 million of common stock, preferred stock, debt securities and warrants in one or more offerings and in any combination, all of which may be offered, issued and sold in “at-the-market” sales pursuant to an equity distribution agreement with Cowen and Company, LLC (the Equity Distribution Agreement). No securities have been sold under the 2021 Shelf Registration Statement or the Equity Distribution Agreement.

As of December 31, 2021, shares of common stock reserved for future issuance are as follows (in thousands):


Stock options, RSUs and PSUs outstanding			23,922
Shares available for future grant under the 2017 Performance Incentive Plan			1,142
Shares available for issuance under the employee stock purchase plan			1,043
Total common stock reserved for issuance			26,107

- Definition

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

+ References

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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

Property, Plant and Equipment - Schedule of Property, Plant and Equipment (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Property, Plant and Equipment [Line Items]
Depreciable property, plant and equipment at cost	$ 201,386	$ 193,450
Less: accumulated depreciation	(148,039)	(138,488)
Depreciable property, plant and equipment, net	53,347	54,962
Construction-in-progress	7,163	4,700
Property, plant and equipment, net	60,510	59,662
Building and leasehold improvements
Property, Plant and Equipment [Line Items]
Depreciable property, plant and equipment at cost	97,385	92,977
Laboratory equipment
Property, Plant and Equipment [Line Items]
Depreciable property, plant and equipment at cost	42,704	40,121
Computer equipment and software
Property, Plant and Equipment [Line Items]
Depreciable property, plant and equipment at cost	28,829	28,684
Manufacturing equipment
Property, Plant and Equipment [Line Items]
Depreciable property, plant and equipment at cost	22,374	21,796
Furniture, fixtures, and other
Property, Plant and Equipment [Line Items]
Depreciable property, plant and equipment at cost	$ 10,094	$ 9,872

Stock-Based Compensation

12 Months Ended

Dec. 31, 2021

Share-based Payment Arrangement [Abstract]

Stock-Based Compensation

2017 Performance Incentive Plan

Our 2017 Performance Incentive Plan (2017 Plan) provides for the issuance of our common stock to members of the Board of Directors, officers or employees, certain consultants and advisors and our subsidiaries. Our 2017 Plan has been amended and restated such that an aggregate 34,200,000 shares have been authorized for issuance as of December 31, 2021, including 5,000,000 shares that were approved on June 10, 2021. Under the 2017 Plan, we may issue stock options, restricted stock, performance stock, stock units, stock appreciation rights and other similar types of awards. When the 2017 Plan was approved on June 14, 2017, any shares of our common stock that were available for issuance under our 2012 Performance Incentive Plan (the 2012 Plan) ceased to be available for future grants. However, options and RSUs granted under the 2012 Plan

remained outstanding, and any options or RSUs that were cancelled or forfeited became available for issuance under the 2017 Plan. Shares issued for RSUs, PSUs or any other “full-value award” will be counted against the share limit as 1.5 shares for every one share actually issued in connection with the award.

We have granted or issued non-qualified stock options, RSUs and PSUs to employees, officers, and non-employee directors. For our employees, the requisite service period is generally four years for stock options, and three years for RSUs and PSUs. For our directors, the requisite service is generally one year for stock options and RSUs. The maximum term of a stock option or stock appreciation right is eight years from the date of grant. The per share exercise price of an option generally may not be less than the fair market value of a share of our common stock on the NASDAQ Stock Market on the date of grant.

Under our Change in Control Plan (the CIC Plan), in the event of a change of control of Nektar and a subsequent termination of employment initiated by us or a successor company other than for Cause (as defined in the CIC Plan) within twelve months following a change of control, our employees are entitled to full acceleration of their unvested equity awards. Our Chief Executive Officer, Senior Vice Presidents and Vice Presidents (including Principal Fellows) are also entitled to full acceleration of unvested equity awards if the termination is initiated by the employee for a Good Reason Resignation (as defined in the CIC Plan) within twelve months following a change of control. Additionally, non-employee directors would also be entitled to full acceleration of vesting of all outstanding stock awards in the event of a change of control transaction.

Employee Stock Purchase Plan

Under the terms of our the Employee Stock Purchase Plan (ESPP), employees may purchase shares of our common stock based on a percentage of their compensation subject to certain limits. Shares are purchased at 85% of the lower of the closing price on either the first day or last day of each six-month offering period. An aggregate 3,500,000 shares have been authorized for issuance under our ESPP, including 1,000,000 shares approved on June 17, 2020.

Stock-Based Compensation Expense

We recognize total stock-based compensation expense in our Consolidated Statements of Operations as follows (in thousands):


	Year Ended December 31,
	2021		2020		2019
Cost of goods sold	$	2,779	$	2,825	$	4,294
Research and development	54,821		57,116		63,224
General and administrative	37,074		33,295		32,277
Impairment of assets and other costs for terminated program	—		1,025		—
Total stock-based compensation	$	94,674	$	94,261	$	99,795

The stock-based compensation expense reported in impairment of assets and other costs for terminated program results from executive severance. Stock-based compensation expense resulting from PSUs and our ESPP was not significant in the years ended December 31, 2021, 2020, and 2019.

As of December 31, 2021, total unrecognized compensation costs of $187.4 million related to unvested stock-based compensation arrangements are expected to be recognized as expense over a weighted-average period of 2.6 years.

Black-Scholes Assumptions

The following table lists the Black-Scholes option-pricing model assumptions used to calculate the fair value of employee and director stock options, as well as the resulting grant-date fair value:


	Year Ended December 31,
	2021			2020			2019
Average risk-free interest rate	1.2		%	0.4		%	1.8		%
Dividend yield	0.0		%	0.0		%	0.0		%
Average volatility factor	63.8		%	64.1		%	62.2		%
Weighted-average expected life	5.5 years			5.6 years			5.6 years
Weighted-average grant-date fair value of options granted	$	8.07		$	10.70		$	12.25

The average risk-free interest rate is based on the U.S. treasury yield curve in effect at the time of grant for periods commensurate with the expected life of the stock-based award. We have never paid dividends, nor do we expect to pay dividends in the foreseeable future; therefore, we used a dividend yield of zero. Our estimate of expected volatility is based on the daily historical trading data of our common stock at the time of grant over a historical period commensurate with the expected life of the stock-based award. We estimated the weighted-average expected life based on the contractual and vesting terms of the stock options, as well as historical cancellation and exercise data.

Summary of Stock Option Activity

The table below presents a summary of stock option activity under our equity incentive plans (in thousands, except for price per share and contractual life information):


	Number of Shares	Weighted- Average Exercise Price per Share		Weighted- Average Remaining Contractual Life (in Years)	Aggregate Intrinsic Value(1)
Outstanding at December 31, 2020	13,637	$	24.30
Options granted	2,890	14.45
Options exercised	(2,481)	12.08
Options forfeited & canceled	(504)	46.25
Outstanding at December 31, 2021	13,542	$	23.62	4.66	$	2,711

Exercisable at December 31, 2021	8,236	26.94		3.08	$	2,267

_______________________________________________________________

(1)Aggregate intrinsic value represents the difference between the exercise price of the option and the closing market price of our common stock on December 31, 2021.

The intrinsic value of options exercised during the years ended December 31, 2021, 2020 and 2019 totaled $17.3 million, $15.9 million and $30.6 million, respectively.

Summary of RSU Activity

A summary of RSU award activity is as follows (in thousands except for per share amounts):


	Units Issued	Weighted- Average Grant Date Fair Value
Unvested at December 31, 2020	7,094	$	22.46
Granted	6,544	14.68
Vested and released	(2,617)	25.04
Forfeited and canceled	(1,091)	21.13
Unvested at December 31, 2021	9,930	$	16.80

The weighted-average grant-date fair values of RSUs granted during the years ended December 31, 2021, 2020 and 2019 were $14.68, $19.24 and $23.32, respectively. The fair value of restricted stock that vested in the years ended December 31, 2021, 2020 and 2019 totaled $45.3 million, $33.3 million and $32.4 million, respectively.

401(k) Retirement Plan

We sponsor a 401(k) retirement plan whereby eligible employees may elect to contribute up to the lesser of 60% of their annual compensation or the statutorily prescribed annual limit allowable under Internal Revenue Service regulations. The 401(k) plan permits us to make matching contributions on behalf of all participants, up to a maximum of $6,000 per participant. For the years ended December 31, 2021, 2020, and 2019, we recognized $3.6 million, $3.5 million, and $3.5 million, respectively, of compensation expense in connection with our 401(k) retirement plan.

Stock-Based Compensation (Tables)

12 Months Ended

Dec. 31, 2021

Share-based Payment Arrangement [Abstract]

Schedule of Stock-Based Compensation Expense

We recognize total stock-based compensation expense in our Consolidated Statements of Operations as follows (in thousands):


	Year Ended December 31,
	2021		2020		2019
Cost of goods sold	$	2,779	$	2,825	$	4,294
Research and development	54,821		57,116		63,224
General and administrative	37,074		33,295		32,277
Impairment of assets and other costs for terminated program	—		1,025		—
Total stock-based compensation	$	94,674	$	94,261	$	99,795

Schedule of Black-Scholes Option-Pricing Model Assumptions Used to Calculate Fair Value of Employee Stock Options

As of December 31, 2021, shares of common stock reserved for future issuance are as follows (in thousands):


Stock options, RSUs and PSUs outstanding			23,922
Shares available for future grant under the 2017 Performance Incentive Plan			1,142
Shares available for issuance under the employee stock purchase plan			1,043
Total common stock reserved for issuance			26,107

The following table lists the Black-Scholes option-pricing model assumptions used to calculate the fair value of employee and director stock options, as well as the resulting grant-date fair value:


	Year Ended December 31,
	2021			2020			2019
Average risk-free interest rate	1.2		%	0.4		%	1.8		%
Dividend yield	0.0		%	0.0		%	0.0		%
Average volatility factor	63.8		%	64.1		%	62.2		%
Weighted-average expected life	5.5 years			5.6 years			5.6 years
Weighted-average grant-date fair value of options granted	$	8.07		$	10.70		$	12.25

Schedule of Stock Option Activity Under Equity Incentive Plans

The table below presents a summary of stock option activity under our equity incentive plans (in thousands, except for price per share and contractual life information):


	Number of Shares	Weighted- Average Exercise Price per Share		Weighted- Average Remaining Contractual Life (in Years)	Aggregate Intrinsic Value(1)
Outstanding at December 31, 2020	13,637	$	24.30
Options granted	2,890	14.45
Options exercised	(2,481)	12.08
Options forfeited & canceled	(504)	46.25
Outstanding at December 31, 2021	13,542	$	23.62	4.66	$	2,711

Exercisable at December 31, 2021	8,236	26.94		3.08	$	2,267

_______________________________________________________________(1)Aggregate intrinsic value represents the difference between the exercise price of the option and the closing market price of our common stock on December 31, 2021.

Schedule of Restricted Stock Unit Award Activity

A summary of RSU award activity is as follows (in thousands except for per share amounts):


	Units Issued	Weighted- Average Grant Date Fair Value
Unvested at December 31, 2020	7,094	$	22.46
Granted	6,544	14.68
Vested and released	(2,617)	25.04
Forfeited and canceled	(1,091)	21.13
Unvested at December 31, 2021	9,930	$	16.80

Cash and Investments in Marketable Securities - Additional Information (Details) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Cash and Investments in Marketable Securities [Line Items]
Sales of investments	$ 11,504,000	$ 41,700,000	$ 0
Accrued interest receivable	1,400,000	5,100,000
Gross unrealized gains	12,000	1,100,000
Gross unrealized losses	674,000	200,000
Letter of credit	$ 8,100,000	$ 8,100,000
Minimum
Cash and Investments in Marketable Securities [Line Items]
Long term investment maturity period	1 year
Maximum
Cash and Investments in Marketable Securities [Line Items]
Long term investment maturity period	2 years	2 years

Segment Reporting - Revenue by Geographic Area (Detail) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2021	Sep. 30, 2021	Jun. 30, 2021	Mar. 31, 2021	Dec. 31, 2020	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Revenue by geographic area
Total revenue	$ 25,009	$ 24,921	$ 28,330	$ 23,647	$ 23,462	$ 30,033	$ 48,847	$ 50,573	$ 101,907	$ 152,915	$ 114,617
United States \| Reportable Geographical Components
Revenue by geographic area
Total revenue									10,114	64,966	27,093
Rest of World \| Reportable Geographical Components
Revenue by geographic area
Total revenue									$ 91,793	$ 87,949	$ 87,524

- Definition

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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+ Details

Property, Plant and Equipment - Additional Information (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Property, Plant and Equipment [Abstract]
Depreciation and amortization expenses	$ 13.0	$ 12.5	$ 11.0

Operating Leases - Schedule of Operating Lease Information (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2021 USD ($) ft² term	Dec. 31, 2020 USD ($) ft²	Dec. 31, 2019 USD ($)
Leases [Line Items]
Operating lease right-of-use assets recognized in exchange for lease liabilities	$ 1,057	$ 2,133	$ 57,691
Mission Bay Facility
Leases [Line Items]
Leased space delivered (in sq ft) \| ft²	2,012	4,940
Operating lease right-of-use assets recognized in exchange for lease liabilities	$ 1,057	$ 2,133
Number of consecutive terms to extend lease \| term	2
Lease extension term	5 years
Third Street Facility
Leases [Line Items]
Leased space delivered (in sq ft) \| ft²	0	0
Operating lease right-of-use assets recognized in exchange for lease liabilities	$ 0	$ 0
Number of consecutive terms to extend lease \| term	1
Lease extension term	5 years

Income Taxes

12 Months Ended

Dec. 31, 2021

Income Tax Disclosure [Abstract]

Income Taxes

Income (loss) before provision for income taxes includes the following components (in thousands):


	Year Ended December 31,
	2021		2020		2019
Domestic	$	(524,440)	$	(445,370)	$	(441,494)
Foreign	1,160		1,423		1,440
Loss before provision for income taxes	$	(523,280)	$	(443,947)	$	(440,054)

Provision for Income Taxes

The provision for income taxes consists of the following (in thousands):


	Year Ended December 31,
	2021		2020		2019
Current:
Federal	$	—	$	—	$	—
State	50		165		139
Foreign	609		364		495
Total current income tax expense	659		529		634
Deferred:
Federal	—		—		—
State	—		—		—
Foreign	(102)		(36)		(21)
Total deferred income tax expense	(102)		(36)		(21)
Provision for income taxes	$	557	$	493	$	613

Our income tax provision related to continuing operations differs from the amount computed by applying the statutory income tax rate of 21% to our pretax loss as follows (in thousands):


	Year Ended December 31,
	2021		2020		2019
Income tax benefit at federal statutory rate	$	(109,889)	$	(93,229)	$	(92,411)
Research credits	(4,727)		(3,081)		(10,511)
Change in valuation allowance	97,914		87,060		104,440
Non-cash interest expense on liability related to sales of future royalties	9,936		6,356		5,259
Non-cash royalty revenue related to sales of future royalties	(7,891)		(7,967)		(7,624)
Loss on revaluation of liability related to the sale of future royalties	4,940		—		—
Stock-based compensation	6,627		7,929		(672)
Other	3,647		3,425		2,132
Provision for income taxes	$	557	$	493	$	613

Deferred Tax Assets and Liabilities

Deferred income taxes reflect the net tax effects of loss and credit carryforwards and temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. We measure deferred tax assets and liabilities based on the rates at which they are expected to reverse in the future. Significant components of our deferred tax assets for federal and state income taxes are as follows (in thousands):


	December 31,
	2021		2020
Deferred tax assets:
Net operating loss carryforwards	$	564,712	$	456,284
Research and other credits	139,996		132,994
Operating lease liabilities	34,680		35,672
Stock-based compensation	33,408		32,517
Liability related to the sale of future royalties	23,757		32,737
Development derivative liability	6,639		—
Other	10,651		11,688
Deferred tax assets before valuation allowance	813,843		701,892
Valuation allowance for deferred tax assets	(785,748)		(670,103)
Total deferred tax assets	28,095		31,789
Deferred tax liabilities:
Operating lease right-of-use assets	(27,204)		(29,707)
Other	(564)		(1,856)
Total deferred tax liabilities	(27,768)		(31,563)
Net deferred tax assets	$	327	$	226

Realization of our deferred tax assets is dependent upon future earnings, if any, the timing and amount of which are uncertain. Because of our lack of U.S. earnings history, other than income resulting from revenue recognized from the BMS Collaboration Agreement, and projected future losses, we have fully reserved our net U.S. deferred tax assets with a valuation allowance. The valuation allowance increased by $115.6 million and $95.0 million during the years ended December 31, 2021 and 2020, respectively. The increase in the valuation allowance is consistent with the increase in net operating loss carryforwards in the respective periods.

Net Operating Loss and Tax Credit Carryforwards

As of December 31, 2021, we had a net operating loss carryforward for federal income tax purposes of approximately $2.4 billion, portions of which will begin to expire in 2022 and a total state net operating loss carryforward of approximately $1.5 billion, portions of which will begin to expire in 2026. We have federal research credits of approximately $103.3 million, which will begin to expire in 2023 and state research credits of approximately $47.0 million which have no expiration date. We have federal orphan drug credits of $19.4 million which will begin to expire in 2026. Utilization of some of the federal and state

net operating loss and credit carryforwards are subject to annual limitations due to the “change in ownership” provisions of the Internal Revenue Code of 1986 and similar state provisions.

Unrecognized tax benefits

We have the following activity relating to unrecognized tax benefits (in thousands):


	Year Ended December 31,
	2021		2020		2019
Beginning balance	$	78,665	$	77,410	$	27,419
Tax positions related to current year:
Additions	2,371		2,512		49,858
Reductions	—		—		—
Tax positions related to prior years:
Additions	58		193		277
Reductions	(490)		(1,450)		(144)
Settlements	—		—		—
Lapses in statute of limitations	—		—		—
Ending balance	$	80,604	$	78,665	$	77,410

If we are eventually able to recognize our uncertain tax positions, our effective tax rate may be reduced. We currently have a full valuation allowance against our U.S. net deferred tax asset which would impact the timing of the effective tax rate benefit should any of these uncertain tax positions be favorably settled in the future. Adjustments to the substantial majority of our uncertain tax positions would result in an adjustment of our net operating loss or tax credit carryforwards rather than resulting in a cash outlay.

We file income tax returns in the U.S., California, Alabama, certain other states and India. As a result of our net operating loss and research credit carryforwards, substantially all of our domestic tax years remain open and subject to examination. We may be subject to examination in India from time to time, but we do not believe that any liability resulting from such an examination would have a material effect on our financial position or results of operations.

Our policy is to include interest and penalties related to unrecognized tax benefits, if any, within the provision for income taxes in the consolidated statements of operations. During the years ended December 31, 2021, 2020 and 2019, no significant interest or penalties were recognized relating to unrecognized tax benefits. Although it is reasonably possible that certain unrecognized tax benefits could change in the future, we do not anticipate any significant changes over the next twelve months.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

License and Collaboration Agreements - License, Collaboration and Other Revenue (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
License And Collaboration Agreements [Line Items]
License, collaboration and other revenue	$ 436	$ 55,849	$ 16,975
Bempegaldesleukin
License And Collaboration Agreements [Line Items]
License, collaboration and other revenue	0	50,000	0
NKTR-358
License And Collaboration Agreements [Line Items]
License, collaboration and other revenue	0	1,259	7,019
Neulasta
License And Collaboration Agreements [Line Items]
License, collaboration and other revenue	$ 0	$ 4,167	$ 5,000

Segment Reporting

12 Months Ended

Dec. 31, 2021

Segment Reporting [Abstract]

Segment Reporting

We operate in one business segment which focuses on applying our technology platforms to develop novel drug candidates. Our business offerings have similar economics and other characteristics, including the nature of products and manufacturing processes, types of customers, distribution methods and regulatory environment. We are comprehensively managed as one business segment by our Chief Executive Officer.

Our revenue is derived primarily from customers in the pharmaceutical and biotechnology industries. Revenue from UCB Pharma, Baxalta / Takeda, AstraZeneca and Pfizer represented 36%, 23%, 16% and 13% of our revenue, respectively, for the year ended December 31, 2021. Revenue from BMS, UCB Pharma, Baxalta / Takeda, and AstraZeneca represented 33%, 23%, 14% and 13% of our revenue for the year-ended December 31, 2020. Revenue from UCB Pharma, Baxalta / Takeda, and AstraZeneca represented 28%, 19%, and 17% of our revenue for the year-ended December 31, 2019.

Revenue by geographic area is based on the headquarters or shipping locations of our partners. The following table sets forth revenue by geographic area (in thousands):


	Year Ended December 31,
	2021		2020		2019
United States	$	10,114	$	64,966	$	27,093
Rest of World	91,793		87,949		87,524
Total revenue	$	101,907	$	152,915	$	114,617

At December 31, 2021, $56.1 million, or approximately 93%, of the net book value of our property, plant and equipment was located in the United States and $4.4 million, or approximately 7%, was located in India. At December 31, 2020, $54.5 million, or approximately 91%, of the net book value of our property, plant and equipment was located in the United States and $5.1 million, or approximately 9%, was located in India.

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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+ Details

Co-Development Agreement with SFJ Pharmaceuticals and Development Derivative Liability - Additional Information (Details)	Feb. 12, 2021 USD ($)	Dec. 31, 2021
Cost of Borrowing
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Counterparty cost of borrowing		0.127
SFJ Pharmaceuticals
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Committed funding	$ 150,000,000
Success-based payments, first indication	$ 450,000,000
Success-based payments, first indication, period to be paid	5 years
Success-based payments, first payment	$ 30,000,000
Success-based payments, second indication	$ 150,000,000
Success-based payments, second indication, period to be paid	7 years
Additional indication payment	$ 37,500,000
SFJ Pharmaceuticals \| Cost of Borrowing
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Counterparty cost of borrowing		0.015

Operating Leases

12 Months Ended

Dec. 31, 2021

Leases [Abstract]

Operating Leases

Operating Leases Our leases consist of a Lease Agreement (the Mission Bay Lease) with ARE-San Francisco No. 19, LLC (ARE) for our 155,215 square foot corporate office and R&D facility located at 455 Mission Bay Boulevard, San Francisco, California (the Mission Bay Facility) and a Lease Agreement (the Third Street Lease) with Kilroy Realty Finance Partnership, L.P. (Kilroy) for an additional 135,936 square foot facility to support our R&D operations at 360 Third Street, San Francisco,

California (the Third Street Facility). The following table presents key information regarding these leases (dollars in thousands):


	Mission Bay Facility		Third Street Facility
Lease commencement	September 2017		June 2018
Lease term	January 2030		January 2030
Space delivered during the year ended December 31, 2020
Square footage	4,940		—
Right-of-use asset and lease liability recognized	$	2,133	$	—
Space delivered during the year ended December 31, 2021
Square footage	2,012		—
Right-of-use asset and lease liability recognized	$	1,057	$	—
Renewal terms	Two consecutive five-year terms		One five-year term

•The monthly base rent for both facilities will escalate over the term of the lease at various intervals.

•Both leases include various covenants, indemnities, defaults, termination rights, security deposits and other provisions customary for lease transactions of this nature.

•During the term of the Mission Bay Lease, we are responsible for paying our share of operating expenses specified in the lease, including utilities, common area maintenance, insurance costs and taxes.

•For the Third Street Lease, our fixed annual base rent on an industrial gross lease basis includes certain expenses and property taxes paid directly by the landlord. We have a one-time right of first offer with respect to certain additional rental space at the Third Street Facility.

We recognize rent expense for these operating leases on a straight-line basis over the lease period. The components of lease expense, which we include in operating expenses in our Consolidated Statements of Operations, were as follows (in thousands):


	Year Ended December 31,
	2021		2020		2019
Operating lease expense	$	19,153	$	18,985	$	14,697
Variable lease expense	8,974		8,179		6,408
Total lease expense	$	28,127	$	27,164	$	21,105

During the years ended December 31, 2021, 2020 and 2019, we paid $16.8 million, $16.2 million and $8.4 million, respectively, of operating lease payments related to our lease liabilities, which we include in net cash used in operating activities in our Consolidated Statements of Cash Flows.

As of December 31, 2021, the maturities of our operating lease liabilities were as follows (in thousands):


Year ending December 31,
2022	$	18,626
2023	20,909
2024	21,572
2025	22,255
2026	22,957
2027 and thereafter	75,411
Total lease payments	181,730
Less: portion representing interest	(37,900)
Less: lease incentives	(653)
Operating lease liabilities	143,177
Less: current portion	(17,441)
Operating lease liabilities, less current portion	$	125,736

As of December 31, 2021, the weighted-average remaining lease term is 8.1 years and the weighted-average discount rate used to determine the operating lease liability was 5.8%.

Inventory - Schedule of Inventories (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Inventory Disclosure [Abstract]
Raw materials	$ 3,166	$ 2,422
Work-in-process	9,342	10,703
Finished goods	3,293	2,167
Total inventory	$ 15,801	$ 15,292

Liabilities Related to the Sales of Future Royalties (Tables)

12 Months Ended

Dec. 31, 2021

Schedule of Liability Related to Potential Future Royalties

The following table shows the activity within the liability account of each arrangement (in thousands):


	Year-Ended December 31, 2021						Period from inception to December 31, 2021
	2012 Purchase and Sale Agreement		2020 Purchase and Sale Agreement		Total		2012 Purchase and Sale Agreement		2020 Purchase and Sale Agreement		Total
Liabilities related to the sales of future royalties—beginning balance	$	65,880	$	139,375	$	205,255	$	—	$	—	$	—
Royalty monetization proceeds	—		—		—		124,000		150,000		274,000
Non-cash royalty revenue	(37,578)		(40,168)		(77,746)		(282,658)		(50,793)		(333,451)
Non-cash interest expense	26,458		20,855		47,313		223,418		20,855		244,273
Payments to RPI	—		—		—		(10,000)		—		(10,000)
Loss on revaluation of liability related to the sale of future royalties	23,522				23,522		23,522		—		23,522
Liabilities related to the sales of future royalties – ending balance	78,282		120,062		198,344		78,282		120,062		198,344
Less: unamortized transaction costs	—		(2,917)		(2,917)		—		(2,917)		(2,917)
Liabilities related to the sales of future royalties, net	$	78,282	$	117,145	$	195,427	$	78,282	$	117,145	$	195,427

Stock-Based Compensation - Schedule of Stock Option Activity Under Equity Incentive Plans (Details) $ / shares in Units, shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2021 USD ($) $ / shares shares
Number of Shares
Outstanding, beginning balance (in shares) \| shares	13,637
Options granted (in shares) \| shares	2,890
Options exercised (in shares) \| shares	(2,481)
Options forfeited and canceled (in shares) \| shares	(504)
Outstanding, ending balance (in shares) \| shares	13,542
Weighted- Average Exercise Price per Share
Outstanding, beginning balance (in dollars per share) \| $ / shares	$ 24.30
Options granted (in dollars per share) \| $ / shares	14.45
Options exercised (in dollars per share) \| $ / shares	12.08
Options forfeited and canceled (in dollars per share) \| $ / shares	46.25
Outstanding, ending balance (in dollars per share) \| $ / shares	$ 23.62
Weighted- Average Remaining Contractual Life (in Years)
Weighted-Average Remaining Contractual Life, outstanding	4 years 7 months 28 days
Aggregate Intrinsic Value, outstanding \| $	$ 2,711
Number of Shares, exercisable (in shares) \| shares	8,236
Weighted-Average Exercise Price Per Share, exercisable (in dollars per share) \| $ / shares	$ 26.94
Weighted-Average Remaining Contractual Life, exercisable	3 years 29 days
Aggregate Intrinsic Value, exercisable \| $	$ 2,267

Selected Quarterly Financial Data (Tables)

12 Months Ended

Dec. 31, 2021

Quarterly Financial Information Disclosure [Abstract]

Schedule of Quarterly Financial Data


	Year Ended December 31, 2021								Year Ended December 31, 2020
	Q1		Q2		Q3		Q4		Q1		Q2		Q3		Q4
Product sales	$	4,795	$	7,846	$	5,194	$	5,890	$	3,444	$	5,485	$	5,691	$	2,884
Total revenue	$	23,647	$	28,330	$	24,921	$	25,009	$	50,573	$	48,847	$	30,033	$	23,462
Cost of goods sold	$	5,756	$	7,667	$	5,311	$	6,163	$	3,811	$	5,773	$	5,570	$	4,323
Research and development expenses	$	95,604	$	101,313	$	103,738	$	99,614	$	108,987	$	96,436	$	100,531	$	102,724
Operating loss	$	(109,392)	$	(110,205)	$	(113,596)	$	(112,910)	$	(133,631)	$	(77,709)	$	(103,050)	$	(110,721)
Net loss	$	(122,967)	$	(125,519)	$	(129,706)	$	(145,645)	$	(138,651)	$	(80,000)	$	(108,586)	$	(117,203)
Net loss per share, basic and diluted(1)	$	(0.68)	$	(0.69)	$	(0.70)	$	(0.79)	$	(0.78)	$	(0.45)	$	(0.61)	$	(0.65)

_______________________________________________________________

(1)Quarterly loss per share amounts may not total to the year-to-date loss per share due to rounding.

Income Taxes - Schedule of Income (Loss) Before Provision for Income Taxes (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Income Tax Disclosure [Abstract]
Domestic	$ (524,440)	$ (445,370)	$ (441,494)
Foreign	1,160	1,423	1,440
Loss before provision for income taxes	$ (523,280)	$ (443,947)	$ (440,054)

- Definition

Amount of income (loss) from continuing operations, including income (loss) from equity method investments, before deduction of income tax expense (benefit), and income (loss) attributable to noncontrolling interest.

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-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8924-108599

Reference 10: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 220
-Section S99
-Paragraph 1
-Subparagraph (SX 210.9-04(15))
-URI http://asc.fasb.org/extlink&oid=120399700&loc=SL114874048-224260

+ Details

Inventory

12 Months Ended

Dec. 31, 2021

Inventory Disclosure [Abstract]

Inventory

Inventory Inventory consists of the following (in thousands):


	December 31,
	2021		2020
Raw materials	$	3,166	$	2,422
Work-in-process	9,342		10,703
Finished goods	3,293		2,167
Total inventory	$	15,801	$	15,292

Segment Reporting - Additional Information (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2021 USD ($) segment	Dec. 31, 2020 USD ($)	Dec. 31, 2019
Segment Reporting Information [Line Items]
Number of operating business segment \| segment	1
Property, plant and equipment, net	$ 60,510	$ 59,662
United States
Segment Reporting Information [Line Items]
Property, plant and equipment, net	56,100	54,500
India
Segment Reporting Information [Line Items]
Property, plant and equipment, net	$ 4,400	$ 5,100
Revenue \| UCB \| Customer Concentration Risk
Segment Reporting Information [Line Items]
Percentage revenue from customers	36.00%	23.00%	28.00%
Revenue \| Baxalta Incorporated Or Takeda P L C \| Customer Concentration Risk
Segment Reporting Information [Line Items]
Percentage revenue from customers	23.00%	14.00%	19.00%
Revenue \| Astra Zeneca Ab \| Customer Concentration Risk
Segment Reporting Information [Line Items]
Percentage revenue from customers	16.00%	13.00%	17.00%
Revenue \| Pfizer \| Customer Concentration Risk
Segment Reporting Information [Line Items]
Percentage revenue from customers	13.00%
Revenue \| BMS \| Customer Concentration Risk
Segment Reporting Information [Line Items]
Percentage revenue from customers		33.00%
Property, Plant and Equipment \| Geographic Concentration Risk \| United States
Segment Reporting Information [Line Items]
Percentage revenue from customers	93.00%	91.00%
Property, Plant and Equipment \| Geographic Concentration Risk \| India
Segment Reporting Information [Line Items]
Percentage revenue from customers	7.00%	9.00%

License and Collaboration Agreements (Tables)

12 Months Ended

Dec. 31, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

License, Collaboration and Other Revenue

In accordance with our collaboration agreements, we recognized license, collaboration and other revenue as follows (in thousands):


		Year Ended December 31,
Partner	Agreement	2021		2020		2019
Bristol-Myers Squibb	Bempegaldesleukin	$	—	$	50,000	$	—
Eli Lilly and Company	NKTR-358	—		1,259		7,019
Amgen, Inc.	Neulasta®	—		4,167		5,000
Other		436		423		4,956
License, collaboration and other revenue		$	436	$	55,849	$	16,975

Co-Development Agreement with SFJ Pharmaceuticals and Development Derivative Liability - Schedule of Fair Value of Derivative Liability (Details) - Development Derivative Liability - Level 3 $ in Thousands	11 Months Ended
	Dec. 31, 2021 USD ($)
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Fair value at inception on February 12, 2021	$ 0
Non-cash research and development expense	16,703
Cash receipts from SFJ	3,000
Change in the fair value of development derivative liability	(8,023)
Fair value at end of period	$ 27,726

Liabilities Related to the Sales of Future Royalties - Additional Information (Details) $ in Thousands				1 Months Ended		3 Months Ended	12 Months Ended
	Dec. 30, 2020 USD ($)	Dec. 16, 2020 USD ($)	Feb. 24, 2012 USD ($)	Mar. 31, 2014 USD ($)	Mar. 31, 2013 USD ($)	Dec. 31, 2021 USD ($)	Dec. 31, 2021 USD ($)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 USD ($)
Liability Related to the Sale of Future Royalties [Line Items]
Loss on revaluation of liability related to the sale of future royalties							$ 24,410	$ 0	$ 0
2012 Purchase and Sale Agreement
Liability Related to the Sale of Future Royalties [Line Items]
Proceeds from sale of royalty rights			$ 124,000
2012 Purchase and Sale Agreement \| Future Royalties
Liability Related to the Sale of Future Royalties [Line Items]
Fair value of liabilities						$ 84,700	$ 84,700
Loss on revaluation of liability related to the sale of future royalties						23,500
Transaction costs related to revised royalty payments						$ 900
2012 Purchase and Sale Agreement \| Future Royalties \| Measurement Input, Discount Rate
Liability Related to the Sale of Future Royalties [Line Items]
Royalties liability, measurement input						0.160	0.160
2020 Purchase and Sale Agreement
Liability Related to the Sale of Future Royalties [Line Items]
Proceeds from sale of royalty rights	$ 150,000
Payment of transaction related to purchase and sale agreement		$ 210,000
Payment of transaction related to purchase and sale agreement if threshold is not achieved		240,000
Minimum transaction royalties payments needed to pay the difference between the 2025 threshold and 2020 transaction royalties		$ 208,000
Transaction costs related to sale of potential future royalties	$ 3,800
2020 Purchase and Sale Agreement \| Measurement Input, Interest Rate
Liability Related to the Sale of Future Royalties [Line Items]
Royalties liability, measurement input						0.15	0.15
Pursuant to the 2012 Purchase and Sale Agreement
Liability Related to the Sale of Future Royalties [Line Items]
Payment made for milestone not achieved year two				$ 7,000
Payment made for milestone not achieved year one					$ 3,000

License and Collaboration Agreements - Additional Information (Details) - USD ($)			1 Months Ended					3 Months Ended								12 Months Ended
	Feb. 13, 2018	Aug. 23, 2017	Apr. 30, 2018	Sep. 30, 2017	Aug. 31, 2017	Mar. 31, 2016	Oct. 31, 2010	Dec. 31, 2021	Sep. 30, 2021	Jun. 30, 2021	Mar. 31, 2021	Dec. 31, 2020	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	Jan. 09, 2020
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Potential future additional payments for development milestones								$ 40,000,000								$ 40,000,000
Accounts receivable								22,492,000				$ 38,889,000				22,492,000	$ 38,889,000
Received upfront and milestone payment							$ 50,000,000
Revenue recognized from contracts with customers								25,009,000	$ 24,921,000	$ 28,330,000	$ 23,647,000	23,462,000	$ 30,033,000	$ 48,847,000	$ 50,573,000	101,907,000	152,915,000	$ 114,617,000
Deferred revenue								$ 2,000,000								$ 2,000,000
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Revenue period of recognition								10 years								10 years
Purchase Agreement
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Shares issued (in shares)			8,284,600
Sale of stock consideration received			$ 850,000,000
Nektar 214 \| Research and Development
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Reimbursement of expenses																$ 101,500,000	128,200,000		$ 105,400,000
Nektar-358
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Amount of transaction price allocated to performance obligation				$ 125,900,000
Revenue recognized from contracts with customers					$ 125,900,000
BMS Collaboration Agreement
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Accounts receivable								$ 21,400,000				$ 38,700,000				21,400,000	38,700,000
Company share of development costs, annual cap																125,000,000	4,000,000
Bristol Myers Squibb Collaboration Agreement \| Purchase Agreement
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Total consideration received under agreements																			1,850,000,000
Estimated fair value of shares																			790,200,000
Remaining amount allocated to transaction price																	$ 50,000,000		$ 1,059,800,000
Potential future development, regulatory and sales milestones								1,800,000,000								1,800,000,000
Bristol Myers Squibb Collaboration Agreement \| Nektar 214
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Global commercialization profits and losses sharing percentage	35.00%
Percentage of sharing production costs	35.00%
Bristol Myers Squibb Collaboration Agreement \| Nektar 214 \| Nektar's
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Global commercialization profits and losses sharing percentage	65.00%
Percentage of sharing production costs	65.00%
Upfront and milestone payments received from license agreements			1,000,000,000
Maximum total additional cash payments receivable upon achievement of certain development and regulatory milestones																1,400,000,000
Bristol Myers Squibb Collaboration Agreement \| Nektar 214 \| Maximum \| Nektar's
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Eligible additional cash payments receivable upon achievement of certain sales milestones			$ 350,000,000
Bristol Myers Squibb Collaboration Agreement \| Nektar 214 \| Opdivo
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Percentage of sharing development costs	67.50%
Bristol Myers Squibb Collaboration Agreement \| Nektar 214 \| Opdivo \| Nektar's
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Percentage of sharing development costs	32.50%
Nektar-358
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Percentage of sharing in Phase 2 development costs		75.00%
Nektar-358 \| Nektar's
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Received upfront and milestone payment				150,000,000
Percentage of sharing in Phase 2 development costs		25.00%
Percentage of regulatory milestones payments will be reduced under certain conditions		50.00%
Percentage of regulatory milestones payments will be reduced if conditions occur		75.00%
Nektar-358 \| Maximum
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Potential future additional development and regulatory milestones		$ 250,000,000
Nektar-358 \| Maximum \| Nektar's
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Percentage of funding phase 3 development costs on an indication by indication basis borne		25.00%
Nektar-358 \| Minimum \| Nektar's
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Percentage of funding phase 3 development costs on an indication by indication basis borne		0.00%
Phase 1 Clinical Development \| Nektar-358
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Amount of transaction price allocated to performance obligation				17,600,000
Drug Product Development \| Nektar-358
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Amount of transaction price allocated to performance obligation				$ 6,500,000
NKTR-358 \| Nektar's
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Deferred revenue								$ 0								$ 0
Nektar
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Percentage of upfront payment, market access milestones, royalties and sales milestones						40.00%
Milestone One \| Bristol Myers Squibb Collaboration Agreement \| Nektar 214 \| Nektar's
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Potential future additional payments for development milestones																				$ 25,000,000

Stock-Based Compensation - Schedule of Restricted Stock Unit Award Activity (Details) - Restricted Stock Units (RSU) - $ / shares shares in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Units Issued
Beginning balance (in shares)	7,094
Granted (in shares)	6,544
Vested and released (in shares)	(2,617)
Forfeited and canceled (in shares)	(1,091)
Ending balance (in shares)	9,930	7,094
Weighted- Average Grant Date Fair Value
Beginning balance (in dollars per share)	$ 22.46
Granted (in dollars per share)	14.68	$ 19.24	$ 23.32
Vested and released (in dollars per share)	25.04
Forfeited and canceled (in dollars per share)	21.13
Ending balance (in dollars per share)	$ 16.80	$ 22.46

Stock-Based Compensation - Additional Information (Details)		12 Months Ended
	Jun. 17, 2020 shares	Dec. 31, 2021 USD ($) shares	Dec. 31, 2020 USD ($)	Dec. 31, 2019 USD ($)	Jun. 10, 2021 shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Change in control severance payment period for executives		12 months
Total unrecognized compensation costs		$ 187,400,000
Recognized over a weighted-average period		2 years 7 months 6 days
Dividend yield		0.00%	0.00%	0.00%
Total intrinsic value of options exercised		$ 17,300,000	$ 15,900,000	$ 30,600,000
Maximum 401(k) per employee, percentage of annual salary		60.00%
Matching 401(k) employer contribution, maximum amount		$ 6,000
Compensation expense in connection with 401(k) retirement plan		$ 3,600,000	3,500,000	3,500,000
2017 Performance Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares authorized \| shares		34,200,000			5,000,000
Share-based compensation plan's share limit reduction for every one restricted stock unit granted		1.5
Stock options term under equity incentive plans		8 years
Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Dividend yield		0.00%
Stock Options \| 2017 Performance Incentive Plan \| Employee
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Service period for stock-based compensation award granted		4 years
Stock Options \| 2017 Performance Incentive Plan \| Director
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Service period for stock-based compensation award granted		1 year
RSUs and PSUs \| 2017 Performance Incentive Plan \| Employee
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Service period for stock-based compensation award granted		3 years
Employee Stock Purchase Plan \| Employee Stock Purchase Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Purchase price of common stock, percent		85.00%
Number of common stock shares available for stock options grants (in shares) \| shares		3,500,000
Number of additional shares available for award grants (in shares) \| shares	1,000,000
Restricted Stock Units (RSU)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Fair value of restricted stock vested		$ 45,300,000	$ 33,300,000	$ 32,400,000

Consolidated Statements of Cash Flows (Parenthetical) $ in Millions	12 Months Ended
	Dec. 31, 2021 USD ($)
Statement of Cash Flows [Abstract]
Sale of future royalties transaction costs	$ 3.8

Income Taxes - Schedule of Significant Components of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Deferred tax assets:
Net operating loss carryforwards	$ 564,712	$ 456,284
Research and other credits	139,996	132,994
Operating lease liabilities	34,680	35,672
Stock-based compensation	33,408	32,517
Liability related to the sale of future royalties	23,757	32,737
Development derivative liability	6,639	0
Other	10,651	11,688
Deferred tax assets before valuation allowance	813,843	701,892
Valuation allowance for deferred tax assets	(785,748)	(670,103)
Total deferred tax assets	28,095	31,789
Deferred tax liabilities:
Operating lease right-of-use assets	(27,204)	(29,707)
Other	(564)	(1,856)
Total deferred tax liabilities	(27,768)	(31,563)
Net deferred tax assets	$ 327	$ 226

Liabilities Related to the Sales of Future Royalties

12 Months Ended

Dec. 31, 2021

On February 24, 2012, we entered into a purchase and sale agreement (the 2012 Purchase and Sale Agreement) with RPI Finance Trust (RPI), an affiliate of Royalty Pharma, pursuant to which we sold, and RPI purchased, our right to receive royalty payments (the 2012 Transaction Royalties) arising from the worldwide net sales, from and after January 1, 2012, of (a) CIMZIA®, under our license, manufacturing and supply agreement with UCB Pharma (UCB), and (b) MIRCERA®, under our license, manufacturing and supply agreement with F. Hoffmann-La Roche Ltd and Hoffmann-La Roche Inc. (together referred to as Roche). We received aggregate cash proceeds of $124.0 million for the 2012 Transaction Royalties. Although we sold all of our rights to receive royalties from the CIMZIA® and MIRCERA® products, as a result of our ongoing manufacturing and supply obligations related to the generation of these royalties, we continue to account for these royalties as revenue. We recorded the $124.0 million in proceeds from this transaction as a liability (the 2012 Royalty Obligation) that is amortized using the effective interest method over the estimated life of the 2012 Purchase and Sale Agreement as royalties from the CIMZIA® and MIRCERA® products are remitted directly to RPI.

On June 5, 2020, UCB served notice of a Declaratory Judgment of Patent Invalidity, filed in the United States District Court for the District of Delaware, seeking a declaration of invalidity of certain of our patents that we had licensed to UCB and pursued similar actions in other jurisdictions. On October 14, 2021, RPI and we entered into a Letter Agreement which permitted us to enter into a Settlement Agreement, effective October 13, 2021, with UCB to effect the negotiation between RPI and UCB in which UCB and RPI agreed to a reduction in the royalty term and annual decreases in the royalty rate over the remaining royalty term in exchange for UCB’s withdrawal of all of UCB’s litigation and challenges.

We concluded that we should account for the decrease in royalty payments to RPI as a result of these agreements as a modification of our liability. Due to the significance of the change in the estimated royalty payments, we concluded that we should treat the modification as an extinguishment of the prior liability and recognize a new liability based on the revised royalty payments and term, discounted to fair value. Accordingly, we estimated the fair value to be approximately $84.7 million, reflecting a discount rate of 16.0%, and we began amortizing the liability prospectively at this rate commencing in the three months ended December 31, 2021. As a result, we recognized a loss of $23.5 million on the revaluation of the prior liability in the three months ended December 31, 2021, and we wrote off of the remaining $0.9 million of unamortized transaction costs. We present these charges in Loss on revaluation of liability related to the sale of future royalties line in our Consolidated Statement of Operations.

On December 16, 2020, we entered into a purchase and sale agreement (the 2020 Purchase and Sale Agreement) with entities managed by Healthcare Royalty Management, LLC (collectively, HCR). Pursuant to the 2020 Purchase and Sale Agreement, we agreed to sell to HCR certain of our rights to receive royalty payments (the 2020 Transaction Royalties) arising from the worldwide net sales, from and after October 1, 2020 until such time that certain return thresholds are met as described below, of (a) MOVANTIK® under that certain License Agreement, dated September 20, 2009, by and between Nektar and AstraZeneca AB, as amended, (b) ADYNOVATE® under that certain Exclusive Research, Development, License and Manufacturing and Supply Agreement, dated September 26, 2005, by and among Nektar, Baxalta US Inc. and Baxalta GmbH,

as amended, (c) REBINYN® under that certain Settlement and License Agreement, dated December 21, 2016, by and among Nektar, Novo Nordisk Inc., Novo Nordisk A/S and Novo Nordisk A/G and (d) licensed products under that certain Right to Sublicense Agreement, dated October 27, 2017, by and among Nektar, Baxalta Incorporated, Baxalta US Inc. and Baxalta GmbH.

The 2020 Purchase and Sale Agreement will automatically expire, and the payment of the 2020 Transaction Royalties to HCR will cease, when HCR has received payments of the 2020 Transaction Royalties equal to $210.0 million (the 2025 Threshold), if the 2025 Threshold is achieved on or prior to December 31, 2025, or $240.0 million, if the 2025 Threshold is not achieved on or prior to December 31, 2025 (or, if earlier, the date on which the last royalty payment under the relevant license agreements is made). If HCR has received payments of the 2020 Transaction Royalties equal to at least $208.0 million on or prior to December 31, 2025, we have the option to pay the difference between the 2025 Threshold and such 2020 Transaction Royalties, and the 2025 Threshold will be met and the 2020 Purchase and Sale Agreement will expire. After the 2020 Purchase and Sale Agreement expires, all rights to receive the 2020 Transaction Royalties return to Nektar.

On December 30, 2020, we received aggregate cash proceeds of $150.0 million for the 2020 Transaction Royalties. As part of the sale, we incurred approximately $3.8 million in transaction costs, which will be amortized to interest expense over the estimated life of the 2020 Purchase and Sale Agreement. Although we sold all of our rights to receive royalties from these products, as a result of the limits on the 2020 Transaction Royalties to be received by HCR and our ongoing manufacturing and supply obligations related to the generation of these royalties, we will continue to account for these non-cash royalties as revenue, commencing with royalties for the three months ended December 31, 2020, to be received by HCR in the first quarter of 2021. We recorded the $150.0 million in proceeds from this transaction as a liability (the 2020 Royalty Obligation) that will be amortized using the effective interest method over the estimated life of the 2020 Purchase and Sale Agreement. As of December 31, 2021, our prospective effective interest rate used to amortize the liability is 15%.

The following table shows the activity within the liability account of each arrangement (in thousands):


	Year-Ended December 31, 2021						Period from inception to December 31, 2021
	2012 Purchase and Sale Agreement		2020 Purchase and Sale Agreement		Total		2012 Purchase and Sale Agreement		2020 Purchase and Sale Agreement		Total
Liabilities related to the sales of future royalties—beginning balance	$	65,880	$	139,375	$	205,255	$	—	$	—	$	—
Royalty monetization proceeds	—		—		—		124,000		150,000		274,000
Non-cash royalty revenue	(37,578)		(40,168)		(77,746)		(282,658)		(50,793)		(333,451)
Non-cash interest expense	26,458		20,855		47,313		223,418		20,855		244,273
Payments to RPI	—		—		—		(10,000)		—		(10,000)
Loss on revaluation of liability related to the sale of future royalties	23,522				23,522		23,522		—		23,522
Liabilities related to the sales of future royalties – ending balance	78,282		120,062		198,344		78,282		120,062		198,344
Less: unamortized transaction costs	—		(2,917)		(2,917)		—		(2,917)		(2,917)
Liabilities related to the sales of future royalties, net	$	78,282	$	117,145	$	195,427	$	78,282	$	117,145	$	195,427

Pursuant to the 2012 Purchase and Sale Agreement, in March 2014 and March 2013, we were required to pay RPI $7.0 million and $3.0 million, respectively, as a result of worldwide net sales of MIRCERA® for the 12 month periods ended December 31, 2013 and 2012 not reaching certain minimum thresholds. The 2012 Purchase and Sale Agreement does not include any other potential payments related to minimum net sales thresholds and, therefore, we do not expect to make any further payments to RPI related to this agreement.

As royalties are remitted to RPI and HCR by our licensees, the balances of the respective Royalty Obligations will be effectively repaid over the lives of the agreements. To determine the amortization of the Royalty Obligations, we are required to estimate the total amount of future royalty payments to be received by RPI and HCR, respectively. The sum of these amounts less the net proceeds we received will be recorded as non-cash interest expense, as well as the loss on the revaluation described above, over the lives of the respective Royalty Obligations. We periodically assess the estimated royalty payments to RPI and

HCR from our licensees and to the extent the amount or timing of such payments is materially different than our original estimates, we will prospectively adjust the imputed interest rate and the related amortization of the appropriate Royalty Obligation.

There are a number of factors that could materially affect the amount and timing of royalty payments from our licensees, most of which are not within our control. Such factors include, but are not limited to, changing standards of care, the introduction of competing products, manufacturing or other delays, biosimilar competition, intellectual property matters, adverse events that result in governmental health authority imposed restrictions on the use of the drug products, significant changes in foreign exchange rates as the royalties remitted to RPI or HCR are made in U.S. dollars (USD) while significant portions of the underlying sales of the products of our licensees are made in currencies other than USD, and other events or circumstances that could result in reduced royalty payments from our licensees, all of which would result in a reduction of non-cash royalty revenues and the non-cash interest expense over the life of the respective Royalty Obligation. Conversely, for the 2012 Purchase and Sale Agreement, if sales of these products are more than expected, the non-cash royalty revenues and the non-cash interest expense recorded by us would be greater over the term of the 2012 Royalty Obligation.