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Document and Entity Information - shares	6 Months Ended
Document and Entity Information - shares	Jun. 30, 2018	Jul. 26, 2018
Document and Entity Information
Entity Registrant Name	Pacira Pharmaceuticals, Inc.
Entity Central Index Key	0001396814
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Document Type	10-Q
Document Period End Date	Jun. 30, 2018
Document Fiscal Year Focus	2018
Document Fiscal Period Focus (Q1,Q2,Q3,FY)	Q2
Amendment Flag	false
Entity Current Reporting Status	Yes
Entity Common Stock, Shares Outstanding		40,960,416

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Current assets:
Cash and cash equivalents	$ 116,871	$ 54,126
Short-term investments	254,450	257,221
Accounts receivable, net	35,641	31,658
Inventories, net	42,053	41,411
Prepaid expenses and other current assets	6,039	6,694
Total current assets	455,054	391,110
Long-term investments	1,601	60,047
Fixed assets, net	111,276	107,046
Goodwill	59,912	55,197
Summary of Investments, Other than Investments in Related Parties, Carrying Amount	14,146	14,146
Other assets	692	825
Total assets	642,681	628,371
Current liabilities:
Accounts payable	14,260	14,658
Accrued expenses and current portion of deferred revenue	38,434	41,159
Convertible senior notes	330	324
Income taxes payable	0	76
Total current liabilities	53,024	56,217
Convertible senior notes	283,258	276,173
Other liabilities	15,886	16,498
Total liabilities	352,168	348,888
Commitments and contingencies (Note 13)
Stockholders’ equity:
Preferred stock, par value $0.001; 5,000,000 shares authorized; none issued and outstanding at June 30, 2018 and December 31, 2017	0	0
Common stock, par value $0.001; 250,000,000 shares authorized; 40,954,969 shares issued and outstanding at June 30, 2018; 40,668,877 shares issued and outstanding at December 31, 2017	41	41
Additional paid-in capital	686,888	669,032
Accumulated deficit	(395,871)	(389,136)
Accumulated other comprehensive loss	(545)	(454)
Total stockholders’ equity	290,513	279,483
Total liabilities and stockholders’ equity	$ 642,681	$ 628,371

CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Jun. 30, 2018	Dec. 31, 2017
Statement of Financial Position [Abstract]
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized	5,000,000	5,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized	250,000,000	250,000,000
Common stock, shares issued	40,954,969	40,668,877
Common stock, shares outstanding	40,954,969	40,668,877
Treasury stock at cost, shares	0	0

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Revenues:
Net product sales	$ 80,717	$ 70,139	$ 155,004	$ 138,564
Collaborative licensing and milestone revenue	3,000	130	3,000	336
Royalty revenue	390	665	710	1,317
Total revenues	84,107	70,934	158,714	140,217
Operating expenses:
Cost of goods sold	20,916	23,811	43,801	48,392
Research and development	12,239	18,856	26,617	35,487
Selling, general and administrative	44,249	39,552	88,439	81,672
Product discontinuation	162	4,495	252	4,495
Total operating expenses	77,566	86,714	159,109	170,046
Income (loss) from operations	6,541	(15,780)	(395)	(29,829)
Other (expense) income:
Interest income	1,533	1,224	2,906	1,738
Interest expense	(5,397)	(5,226)	(10,553)	(7,815)
Loss on early extinguishment of debt	0	(11)	0	(3,732)
Other, net	(78)	80	(4)	89
Total other expense, net	(3,942)	(3,933)	(7,651)	(9,720)
Income (loss) before income taxes	2,599	(19,713)	(8,046)	(39,549)
Income tax expense	(35)	(30)	(70)	(60)
Net income (loss)	$ 2,564	$ (19,743)	$ (8,116)	$ (39,609)
Net income (loss) per share:
Basic and diluted net loss per common share (in USD per share)	$ 0.06	$ (0.49)	$ (0.20)	$ (1.01)
Weighted average common shares outstanding:
Basic (in shares)	40,796	40,160	40,751	39,079
Diluted (in shares)	41,694	40,160	40,751	39,079

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Statement of Comprehensive Income [Abstract]
Net income (loss)	$ 2,564	$ (19,743)	$ (8,116)	$ (39,609)
Other comprehensive income (loss):
Net unrealized gain (loss) on investments	356	18	(91)	(34)
Total other comprehensive income (loss)	356	18	(91)	(34)
Comprehensive income (loss)	$ 2,920	$ (19,725)	$ (8,207)	$ (39,643)

CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-In Capital	Accumulated Deficit	Accumulated Other Comprehensive Income
Balances (in shares) at Dec. 31, 2017		40,669,000
Balance at beginning of period at Dec. 31, 2017	$ 279,483	$ 41	$ 669,032	$ (389,136)	$ (454)
Increase (Decrease) in Stockholders' Equity
Exercise of stock options (in shares)		103,000
Exercise of stock options	1,492	$ 0	1,492
Vested restricted stock units (in shares)		148,000
Vested restricted stock units	$ 0	$ 0
Shares issued under employee stock purchase plan (shares)	34,985	35,000
Stock Issued During Period, Value, Employee Stock Purchase Plan	$ 952		952
Stock-based compensation	15,432		15,432
Net unrealized gain (loss) on investments	(91)				(91)
Net loss	(8,116)			(8,116)
Balances (in shares) at Jun. 30, 2018		40,955,000
Balance at end of period at Jun. 30, 2018	290,513	$ 41	686,888	(395,871)	(545)
Increase (Decrease) in Stockholders' Equity
Cumulative effect adjustment of the adoption of Accounting Standards Update 2016-09 (Note 2)	1,361			1,361
Net unrealized gain (loss) on investments	356
Net loss	2,564
Balances (in shares) at Jun. 30, 2018		40,955,000
Balance at end of period at Jun. 30, 2018	$ 290,513	$ 41	686,888	(395,871)	$ (545)
Increase (Decrease) in Stockholders' Equity
Cumulative effect adjustment of the adoption of Accounting Standards Update 2016-09 (Note 2)			$ (20)	$ 20

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Operating activities:
Net income (loss)	$ (8,116)	$ (39,609)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation of fixed assets	5,610	6,813
Amortization of unfavorable lease obligation and debt issuance costs	786	524
Amortization of debt discount	6,283	4,362
Loss on early extinguishment of debt	0	3,732
Loss on disposal of fixed assets	10	2,030
Stock-based compensation	15,432	14,744
Changes in operating assets and liabilities:
Accounts receivable, net	(3,640)	2,470
Inventories, net	(642)	(2,324)
Prepaid expenses and other assets	102	1,849
Increase (Decrease) in Accounts Payable	(2,826)	2,149
Accrued expenses and income taxes payable	(2,303)	8,402
Other liabilities	325	(1,480)
Net cash provided by operating activities	11,021	3,662
Investing activities:
Purchases of fixed assets	(7,818)	(8,771)
Purchases of investments	(182,749)	(274,791)
Sales of investments	244,562	82,782
Payment of contingent consideration	(4,715)	(4,206)
Net cash provided by (used in) investing activities	49,280	(204,986)
Financing activities:
Proceeds from exercise of stock options	1,492	2,613
Proceeds from Shares Issued Under Employee Stock Purchase Plans	952	1,056
Proceeds from 2022 convertible senior notes	0	345,000
Repayment of 2019 convertible senior notes	0	(118,191)
Payment of debt issuance and financing costs	0	(11,000)
Costs for conversions of convertible senior notes	0	(284)
Net cash provided by financing activities	2,444	219,194
Net increase in cash and cash equivalents	62,745	17,870
Cash and cash equivalents, beginning of period	54,126
Cash and cash equivalents, end of period	116,871
Supplemental cash flow information:
Cash paid for interest	4,102	2,384
Income Taxes Paid, Net	146	133
Non-cash investing and financing activities:
Issuance of common stock from conversion of 2019 convertible senior notes	0	120,960
Retirement of equity component of 2019 convertible senior notes	0	(126,326)
Net increase in accrued fixed assets	$ 2,032	$ 2,294

DESCRIPTION OF BUSINESS	6 Months Ended
DESCRIPTION OF BUSINESS	Jun. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
DESCRIPTION OF BUSINESS	DESCRIPTION OF BUSINESS Pacira Pharmaceuticals, Inc. and its subsidiaries (collectively, the “Company” or “Pacira”) is a specialty pharmaceutical company focused on the development, manufacture and commercialization of pharmaceutical products, based on its proprietary DepoFoam^® extended release drug delivery technology, for use primarily in hospitals and ambulatory surgery centers. Pacira is committed to driving innovation in postsurgical pain management by improving patient outcomes through the use of opioid-reducing strategies. The Company’s lead product, EXPAREL^®(bupivacaine liposome injectable suspension), which consists of bupivacaine encapsulated in DepoFoam, was approved by the United States Food and Drug Administration, or FDA, on October 28, 2011 and launched commercially in April 2012. The Company also sells its bupivacaine liposome injectable suspension product to a commercial partner to serve animal health indications. Pacira is subject to risks common to companies in similar industries and stages of development, including, but not limited to, competition from larger companies, reliance on revenue from one product, reliance on a single manufacturing site, new technological innovations, dependence on key personnel, reliance on third-party service providers and sole source suppliers, protection of proprietary technology and compliance with government regulations.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

6 Months Ended

Jun. 30, 2018

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation and Principles of Consolidation

These interim condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America, or GAAP, and in accordance with the rules and regulations of the Securities and Exchange Commission, or SEC, for interim reporting. Pursuant to these rules and regulations, certain information and footnote disclosures normally included in complete annual financial statements have been condensed or omitted. Therefore, these interim condensed consolidated financial statements should be read in conjunction with the audited annual consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017.

The condensed consolidated financial statements at June 30, 2018, and for the three and six month periods ended June 30, 2018 and 2017, are unaudited, but include all adjustments (consisting of only normal recurring adjustments) which, in the opinion of management, are necessary to present fairly the financial information set forth herein in accordance with GAAP. The condensed consolidated balance sheet at December 31, 2017 is derived from the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017. The consolidated financial statements as presented reflect certain reclassifications from previously issued financial statements to conform to the current year presentation. The accounts of wholly-owned subsidiaries are included in the condensed consolidated financial statements. Intercompany accounts and transactions have been eliminated in consolidation.

The results of operations for the interim periods are not necessarily indicative of results that may be expected for any other interim periods or for the full year.

Concentration of Major Customers

The Company sells EXPAREL through a drop-ship program under which orders are processed through wholesalers (including AmerisourceBergen Health Corporation, Cardinal Health, Inc. and McKesson Drug Company), but shipments of the product are sent directly to individual accounts, such as hospitals, ambulatory surgery centers and individual doctors. The table below includes the percentage of sales processed by the Company’s three largest wholesalers in each period presented:



	Three Months Ended June 30,		Six Months Ended June 30,
	2018	2017	2018	2017
Largest wholesaler	33%	35%	33%	35%
Second largest wholesaler	29%	29%	30%	29%
Third largest wholesaler	25%	25%	26%	25%
Total	87%	89%	89%	89%

Recently Adopted Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update, or ASU, 2014-09, Revenue from Contracts with Customers, and subsequently issued a number of amendments to this update. The new standard, as amended in Accounting Standards Codification, or ASC, 606, provides a single comprehensive model to be used in accounting for revenue arising from contracts with customers and supersedes previous revenue recognition guidance. The standard’s stated core principle is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In addition, the standard requires disclosure of the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers.

The Company adopted this standard on January 1, 2018 using the modified retrospective method and recorded a cumulative effect adjustment of $1.4 million to accumulated deficit upon adoption—with the impact related to the acceleration of $1.0 million of deferred revenue and $0.4 million of royalties. Under the modified retrospective method of adoption, the comparative information in the consolidated financial statements has not been revised and continues to be reported under the previously applicable revenue accounting guidance, ASC 605. The implementation of ASC 606 did not have a material impact on the Company’s consolidated statements of operations because the timing of revenue recognition for EXPAREL product sales did not change. The Company is recognizing existing collaborative licensing, milestone and royalty revenue earlier, subject to the variable consideration constraints, than it would have under the previous standard. If ASC 605 had been applied to each of the first and second quarters of 2018, deferred revenue would have been $1.0 million higher on the consolidated balance sheet, with $0.1 million in accrued expenses and current portion of deferred revenue and $0.9 million in other liabilities. Under ASC 605, royalty revenue and accounts receivable for both the three and six months ended June 30, 2018 would have been lower by $0.4 million.

For additional information regarding the Company’s revenue, see Note 3, Revenue.

In January 2016, the FASB issued ASU 2016-01, Financial Instruments—Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. ASU 2016-01 changes accounting for equity investments and presentation and disclosure requirements for financial instruments. ASU 2016-01 does not apply to equity investments in consolidated subsidiaries or those accounted for under the equity method of accounting. Equity investments with readily determinable fair values will be measured at fair value with changes in fair value recognized in net income (loss). Entities have the option to measure equity investments without readily determinable fair values either at fair value or at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. The standard also simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment. When a qualitative assessment indicates that impairment exists, an entity is required to measure the investment at fair value. ASU 2016-01 became effective for the Company beginning January 1, 2018. The Company has elected to measure equity investments without readily determinable fair values at cost adjusted for changes in observable prices. The guidance related to equity investments without readily determinable fair values is being applied prospectively to the Company’s investment in TELA Bio, Inc. The adoption of ASU 2016-01 may increase volatility in the Company’s net income as changes in observable prices of equity investments without readily determinable fair values will be recorded in net income (loss). The implementation of this standard did not have a material impact on the Company’s consolidated financial statements and related disclosures.

In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments, which clarifies existing guidance on how companies present and classify certain cash receipts and cash payments in the statement of cash flows by addressing specific cash flow issues in an effort to reduce diversity in practice, including guidance on debt prepayment or extinguishment costs and contingent consideration payments made after a business combination. ASU 2016-15 became effective for the Company on January 1, 2018 and did not have a material impact on the Company’s consolidated statement of cash flows.

In June 2018, the FASB issued ASU 2018-07, Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting, which aligns accounting for share-based payments issued to nonemployees to that of employees under the existing guidance of Topic 718, with certain exceptions. This update supersedes previous guidance for equity-based payments to nonemployees under Subtopic 505-50, Equity—Equity-Based Payments to Non-Employees. The Company chose to early adopt ASU 2018-07 in June 2018 and recorded a cumulative effect adjustment of less than $0.1 million to accumulated deficit upon adoption.

Recent Accounting Pronouncements Not Adopted as of June 30, 2018

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) and subsequently issued clarifications and corrections to the update by issuing ASU 2018-10 in July 2018. This update requires lessees to recognize lease assets and lease liabilities on the balance sheet for those leases classified as operating leases under previous authoritative guidance. The lease liability will be equal to the present value of lease payments and the right-of-use asset will be based on the lease liability, subject to adjustment for items such as initial direct costs. For income statement purposes, the new standard retains a dual model similar to ASC 840, requiring leases to be classified as either operating or financing. For lessees, operating leases will result in straight-line expense (similar to current accounting by lessees for operating leases under ASC 840) while financing leases will result in a front-loaded expense pattern (similar to current accounting by lessees for capital leases under ASC 840). This update also introduces new disclosure requirements for leasing arrangements. The standard will become effective for the Company beginning January 1, 2019. Early adoption is permitted, although the Company does not expect to do so. The Company is currently evaluating the impact of ASU 2016-02 on its consolidated financial statements. For operating leases it will result in the recognition of lease liabilities and corresponding right-of-use assets upon adoption, which will have a material impact on the Company’s consolidated balance sheet. The Company does not believe the adoption of this ASU will have a significant impact on its consolidated statements of operations, stockholders’ equity or cash flows. At adoption, this update will be applied using a modified retrospective approach. Refer to Note 13, Commitments and Contingencies, for further discussion on the Company’s leases.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326), which requires entities to measure all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions and reasonable and supportable forecasts. Entities will now use forward-looking information to better form their credit loss estimates. This update also requires enhanced disclosures to help financial statement users better understand significant estimates and judgments used in estimating credit losses, as well as the credit quality and underwriting standards of an entity’s portfolio. This ASU will become effective for the Company beginning January 1, 2020, with early adoption permitted. The Company is currently evaluating the impact of ASU 2016-13 on its consolidated financial statements.

Other pronouncements issued by the FASB or other authoritative accounting standards groups with future effective dates are either not applicable or not significant to the consolidated financial statements of the Company.

REVENUE

6 Months Ended

Jun. 30, 2018

Revenue from Contract with Customer [Abstract]

REVENUE

Revenue from Contracts with Customers

The Company’s sources of revenue include (i) sales of EXPAREL in the U.S.; (ii) sales of its bupivacaine liposome injectable suspension product for use in animal health indications in the U.S.; (iii) royalties based on sales of its bupivacaine liposome injectable suspension product for use in animal health indications; and (iv) license fees and milestone payments. The majority of the Company’s revenue is derived from sales of EXPAREL. The Company does not consider revenue from other product sales, collaborative licensing, milestones and royalties to be material sources of its consolidated revenue. As such, the following disclosure only relates to revenue associated with net EXPAREL product sales.

Net Product Sales

The Company sells EXPAREL through a drop-ship program under which orders are processed through wholesalers based on orders of the product placed by end-users which include hospitals, ambulatory surgery centers and doctors. EXPAREL is delivered directly to the end-user without the wholesaler ever taking physical possession of the product. Product revenue is recognized when control of the promised goods are transferred to the customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for transferring those goods. EXPAREL revenue is recorded at the time the product is delivered to the end-user.

Revenues from sales of products are recorded net of returns allowances, prompt payment discounts, wholesaler service fees, volume rebates and chargebacks. These reserves are based on estimates of the amounts earned or to be claimed on the related sales. These amounts are treated as variable consideration, estimated and recognized as a reduction of the transaction price at the time of the sale, using the most likely amount method for the gross to net adjustments, except for returns, which is based on the expected value method. The Company includes these estimated amounts in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized for such transaction will not occur, or when the uncertainty associated with the variable consideration is resolved. The calculation of some of these items requires management to make estimates based on sales data, historical return data, contracts and other related information that may become known in the future. The adequacy of these provisions is reviewed on a quarterly basis.

Accounts Receivable

The majority of accounts receivable arise from product sales and represent amounts due from wholesalers, hospitals, ambulatory surgery centers and doctors. Payment terms generally range from zero to 37 days from the date of the transaction so there is no significant financing component.

Performance Obligations

A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of account in ASC 606. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied.

At contract inception, the Company assesses the goods promised in its contracts with customers and identifies a performance obligation for each promise to transfer to the customer a good that is distinct. When identifying individual performance obligations, the Company considers all goods promised in the contract regardless of whether explicitly stated in the customer contract or implied by customary business practices. The Company’s contracts with customers require it to transfer an individual distinct product, which represents a single performance obligation. The Company’s performance obligation with respect to its product sales are satisfied at a point in time, which transfers control upon delivery of EXPAREL to its customers. The Company considers control to have transferred upon delivery because the customer has legal title to the asset, physical possession of the asset has been transferred, the customer has significant risks and rewards of ownership of the asset and the Company has a present right to payment at that time.

Disaggregated Revenue

The following table represents disaggregated net product sales in the periods presented as follows (in thousands):



	Three Months Ended June 30,				Six Months Ended June 30,
	Three Months Ended June 30,				Six Months Ended June 30,
	2018		2017		2018		2017
Net product sales:
EXPAREL	$	80,430	$	69,773	$	154,464	$	137,474
Other product sales	287		366		540		1,090
Total net product sales	$	80,717	$	70,139	$	155,004	$	138,564

INVENTORIES

6 Months Ended

Jun. 30, 2018

Inventory Disclosure [Abstract]

INVENTORIES

The components of inventories are as follows (in thousands):



	June 30,		December 31,
	2018		2017
Raw materials	$	16,070	$	16,500
Work-in-process	7,331		8,371
Finished goods	18,652		16,540
Total	$	42,053	$	41,411

FIXED ASSETS

6 Months Ended

Jun. 30, 2018

Property, Plant and Equipment [Abstract]

FIXED ASSETS

Fixed assets, summarized by major category, consist of the following (in thousands):



	June 30,			December 31,
	2018			2017
Machinery and laboratory equipment	$	41,809		$	39,002
Leasehold improvements	34,932			34,933
Computer equipment and software	7,448			7,086
Office furniture and equipment	1,420			1,603
Construction in progress	79,670			73,632
Total	165,279			156,256
Less: accumulated depreciation	(54,003		)	(49,210		)
Fixed assets, net	$	111,276		$	107,046

For the three months ended June 30, 2018 and 2017, depreciation expense was $2.8 million and $3.7 million, respectively. For each of the three and six month periods ended June 30, 2018 and 2017, capitalized interest on the construction of manufacturing sites was $0.2 million.

For the six months ended June 30, 2018 and 2017, depreciation expense was $5.6 million and $6.8 million, respectively. For the six months ended June 30, 2018 and 2017, capitalized interest on the construction of manufacturing sites was $0.6 million and $0.4 million, respectively.

At June 30, 2018 and December 31, 2017, total fixed assets, net, includes leasehold improvements and manufacturing process equipment located in England in the amount of $65.2 million and $59.8 million, respectively.

GOODWILL AND INTANGIBLE ASSETS

6 Months Ended

Jun. 30, 2018

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

GOODWILL

In March 2007, the Company acquired from SkyePharma Holding, Inc., or Skyepharma, its California operating subsidiary, referred to herein as the Acquisition. The Company’s goodwill arose in April 2012 from a contingent milestone payment to Skyepharma in connection with the Acquisition. The Acquisition was accounted for under Statement of Financial Accounting Standards 141, Accounting for Business Combinations, which was the effective GAAP standard at the Acquisition date. In connection with the Acquisition, the Company agreed to certain earn-out payments based on a percentage of net sales of DepoBupivacaine products collected, including EXPAREL and certain other yet-to-be-developed products, as well as milestone payments for DepoBupivacaine products, including EXPAREL, as follows:


(i)	$10.0 million upon the first commercial sale in the United States (met April 2012);


(ii)	$4.0 million upon the first commercial sale in a major E.U. country (United Kingdom, France, Germany, Italy and Spain);


(iii)	$8.0 million when annual net sales collected reach $100.0 million (met September 2014);


(iv)	$8.0 million when annual net sales collected reach $250.0 million (met June 2016); and


(v)	$32.0 million when annual net sales collected reach $500.0 million.

The first milestone was met in April 2012, resulting in a $10.0 million payment to Skyepharma. The Company recorded this payment net of a $2.0 million contingent consideration liability recognized at the time of the Acquisition, resulting in $8.0 million recorded as goodwill. In September 2014, the Company recorded an $8.0 million milestone in connection with achieving $100.0 million of annual EXPAREL net sales collected, and in June 2016, the Company recorded another $8.0 million milestone for achieving $250.0 million of annual EXPAREL net sales collected. For purposes of meeting future potential milestone payments, with certain exceptions, annual net sales are measured on a rolling quarterly basis. Cumulatively through June 30, 2018, the Company has recorded an additional $35.9 million as goodwill for earn-out payments that are based on a percentage of net sales of DepoBupivacaine products collected, including EXPAREL. Any remaining earn-out payments will also be treated as additional costs of the Acquisition and, therefore, recorded as goodwill if and when each contingency is resolved.

The change in the carrying value of goodwill is summarized as follows (in thousands):



	Carrying Value
Balance at December 31, 2017	$	55,197
Percentage payments on collections of net sales of DepoBupivacaine products	4,715
Balance at June 30, 2018	$	59,912

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

+ References + Details

DEBT

6 Months Ended

Jun. 30, 2018

Debt Disclosure [Abstract]

DEBT

Convertible Senior Notes Due 2022

On March 13, 2017, the Company completed a private placement of $345.0 million in aggregate principal amount of 2.375% convertible senior notes due 2022, or 2022 Notes, and entered into an indenture, or 2022 Indenture, with respect to the 2022 Notes. The 2022 Notes accrue interest at a fixed rate of 2.375% per year, payable semiannually in arrears on April 1 and October 1 of each year. The 2022 Notes mature on April 1, 2022.

The total debt composition of the 2022 Notes is as follows (in thousands):



	June 30,			December 31,
	2018			2017
2.375% convertible senior notes due 2022	$	345,000		$	345,000
Deferred financing costs	(6,675		)	(7,482		)
Discount on debt	(55,067		)	(61,345		)
Total debt, net of debt discount and deferred financing costs	$	283,258		$	276,173

The net proceeds from the issuance of the 2022 Notes were $334.0 million, after deducting commissions and the offering expenses paid by the Company. A portion of the net proceeds from the 2022 Notes were used by the Company to repurchase the majority of its then-outstanding 3.25% convertible senior notes due 2019 in privately-negotiated transactions.

Holders may convert their 2022 Notes prior to October 1, 2021 only if certain circumstances are met, including if during the previous calendar quarter, the last reported sales price of the Company’s common stock was greater than 130% of the conversion price then applicable for at least 20 out of the last 30 consecutive trading days of the quarter. During the quarter ended June 30, 2018, this condition for conversion was not met.

On or after October 1, 2021, until the close of business on the second scheduled trading day immediately preceding April 1, 2022, holders may convert their 2022 Notes at any time.

Upon conversion, holders will receive the principal amount of their 2022 Notes and any excess conversion value, calculated based on the per share volume-weighted average price for each of the 40 consecutive trading days during the observation period (as more fully described in the 2022 Indenture). For both the principal and excess conversion value, holders may receive cash, shares of the Company’s common stock or a combination of cash and shares of the Company’s common stock, at the Company’s option. The initial conversion rate for the 2022 Notes is 14.9491 shares of common stock per $1,000 principal amount, which is equivalent to an initial conversion price of $66.89 per share of the Company’s common stock. The conversion rate will be subject to adjustment in some events but will not be adjusted for any accrued and unpaid interest. The initial conversion price of the 2022 Notes represents a premium of approximately 37.5% to the closing sale price of $48.65 per share of the Company’s common stock on the NASDAQ Global Select Market on March 7, 2017, the date that the Company priced the private offering of the 2022 Notes.

As of June 30, 2018, the 2022 Notes had a market price of $934 per $1,000 principal amount. In the event of conversion, holders would forgo all future interest payments, any unpaid accrued interest and the possibility of stock price appreciation. Upon the receipt of conversion requests, the settlement of the 2022 Notes will be paid pursuant to the terms of the 2022 Indenture. In the event that all of the 2022 Notes are converted, the Company would be required to repay the $345.0 million in principal value and any conversion premium in any combination of cash and shares of its common stock (at the Company’s option).

Prior to April 1, 2020, the Company may not redeem the 2022 Notes. On or after April 1, 2020, the Company may redeem for cash, shares of the Company’s common stock or a combination of cash and shares of the Company’s common stock, at the Company’s option, all or part of the 2022 Notes if the last reported sale price (as defined in the 2022 Indenture) of the Company’s common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading-day period ending within five trading days prior to the date on which the Company provides notice of redemption. The redemption price will equal the sum of (i) 100% of the principal amount of the 2022 Notes being redeemed, plus (ii) accrued and unpaid interest, including additional interest, if any, to, but excluding, the redemption date. In addition, calling the 2022 Notes for redemption will constitute a “make whole fundamental change” (as defined in the 2022 Indenture) and will, in certain circumstances, increase the conversion rate applicable to the conversion of such notes if it is converted in connection with the redemption. No sinking fund is provided for the 2022 Notes.

While the 2022 Notes are currently classified on the Company’s consolidated balance sheet at June 30, 2018 as long-term debt, the future convertibility and resulting balance sheet classification of this liability will be monitored at each quarterly reporting date and will be analyzed dependent upon market prices of the Company’s common stock during the prescribed measurement periods. In the event that the holders of the 2022 Notes have the right to convert the 2022 Notes at any time during the prescribed measurement period, the 2022 Notes would then be considered a current obligation and classified as such.

Under ASC 470-20, Debt with Conversion and Other Options, an entity must separately account for the liability and equity components of convertible debt instruments (such as the 2022 Notes) that may be settled entirely or partially in cash upon conversion in a manner that reflects the issuer’s economic interest cost. The liability component of the instrument is valued in a manner that reflects the market interest rate for a similar nonconvertible instrument at the date of issuance. The initial carrying value of the liability component of $274.1 million was calculated using a 7.45% assumed borrowing rate. The equity component of $70.9 million, representing the conversion option, was determined by deducting the fair value of the liability component from the par value of the 2022 Notes and was recorded in additional paid-in capital on the consolidated balance sheet at the issuance date. That equity component is treated as a discount on the liability component of the 2022 Notes, which is amortized over the five-year term of the 2022 Notes using the effective interest rate method. The equity component is not remeasured as long as it continues to meet the conditions for equity classification.

The Company allocated the total transaction costs of $11.0 million related to the issuance of the 2022 Notes to the liability and equity components of the 2022 Notes based on their relative values. Transaction costs attributable to the liability component are amortized to interest expense over the five-year term of the 2022 Notes, and transaction costs attributable to the equity component are netted with the equity component in stockholders’ equity.

Convertible Senior Notes Due 2019

On January 23, 2013, the Company completed a private placement of $120.0 million in aggregate principal amount of 3.25% convertible senior notes due 2019, or 2019 Notes. The 2019 Notes accrue interest at a fixed rate of 3.25% per year, payable semiannually in arrears on February 1 and August 1 of each year. The 2019 Notes mature on February 1, 2019.

The total debt composition of the 2019 Notes is as follows (in thousands):



	June 30,			December 31,
	2018			2017
3.25% convertible senior notes due 2019	$	338		$	338
Deferred financing costs	(1		)	(2		)
Discount on debt	(7		)	(12		)
Total debt, net of debt discount and deferred financing costs	$	330		$	324

In March 2017, the Company used part of the net proceeds from the issuance of the 2022 Notes discussed above to repurchase $117.7 million aggregate principal of the 2019 Notes in privately-negotiated transactions for an aggregate of approximately $118.2 million in cash and the issuance of an aggregate of approximately 2.5 million shares of common stock. The partial repurchase of the 2019 Notes resulted in a $3.7 million loss on early debt extinguishment. In May 2017, the Company repurchased $0.5 million aggregate principal of the 2019 Notes in a privately-negotiated transaction for an aggregate of approximately $0.5 million in cash and the issuance of an aggregate of approximately ten thousand shares of common stock.

The 2019 Notes are convertible at any time. As of June 30, 2018, the 2019 Notes had a market price of $1,320 per $1,000 principal amount, compared to an estimated conversion value of $1,291 per $1,000 principal amount. In the event that the remaining 2019 Notes are converted, the Company would be required to repay approximately $0.3 million of principal value in cash and settle approximately $0.1 million of the conversion premium in cash, common stock or a combination of cash and shares of its common stock, at the Company’s option as of June 30, 2018.

Interest Expense

The following table sets forth the total interest expense recognized in the periods presented (dollar amounts in thousands):



	Three Months Ended June 30,						Six Months Ended June 30,
	2018			2017			2018			2017
Contractual interest expense	$	2,051		$	2,053		$	4,102		$	3,242
Amortization of debt issuance costs	406			389			808			590
Amortization of debt discount	3,170			2,951			6,283			4,362
Capitalized interest and other (Note 5)	(230		)	(167		)	(640		)	(379		)
Total	$	5,397		$	5,226		$	10,553		$	7,815

Effective interest rate on convertible senior notes	7.81		%	7.81		%	7.81		%	7.70		%

FINANCIAL INSTRUMENTS

6 Months Ended

Jun. 30, 2018

Fair Value Disclosures [Abstract]

FINANCIAL INSTRUMENTS

Fair Value Measurements

Fair value is defined as the price that would be received to sell an asset or be paid to transfer a liability in the principal or most advantageous market in an orderly transaction. To increase consistency and comparability in fair value measurements, the FASB established a three-level hierarchy which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three levels of fair value measurements are:


•	Level 1—Quoted prices (unadjusted) in active markets that are accessible at the measurement date for assets or liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs.


•	Level 2—Observable prices that are based on inputs not quoted on active markets, but corroborated by market data.


•	Level 3—Unobservable inputs that are used when little or no market data is available. The fair value hierarchy gives the lowest priority to Level 3 inputs.

The carrying value of financial instruments including cash and cash equivalents, accounts receivable and accounts payable approximate their respective fair values due to the short-term nature of these items. The fair value of the Company’s convertible senior notes at June 30, 2018 are calculated utilizing market quotations from an over-the-counter trading market for these instruments (Level 2). The carrying amount and fair value of the Company’s convertible senior notes are as follows (in thousands):



Financial Liabilities Carried at Historical Cost	Carrying Value		Fair Value Measurements Using
June 30, 2018	Carrying Value		Level 1		Level 2		Level 3
2.375% convertible senior notes due 2022 ⁽¹⁾	$	283,258	$	—	$	322,351	$	—
3.25% convertible senior notes due 2019 ⁽²⁾	$	330	$	—	$	446	$	—

(1) The closing price of the Company’s common stock was $32.05 per share at June 30, 2018 compared to a conversion price of $66.89 per share. Currently, the conversion price is above the stock price. The maximum conversion premium that can be due on the 2022 Notes is approximately 5.2 million shares of the Company’s common stock, which assumes no increases in the conversion rate for certain corporate events.

(2) The closing price of the Company’s common stock was $32.05 per share at June 30, 2018 compared to a conversion price of $24.82 per share which, if converted, would result in a conversion premium of less than ten thousand shares of the Company’s common stock or $0.1 million of cash. The maximum conversion premium that can be due on the 2019 Notes is approximately ten thousand shares of the Company’s common stock, which assumes no increases in the conversion rate for certain corporate events.

Short-term investments consist of asset-backed securities collateralized by credit card receivables, investment grade commercial paper and corporate bonds with maturities greater than three months, but less than one year. Long-term investments consist of asset-backed securities collateralized by credit card receivables and corporate bonds with maturities greater than one year. Net unrealized gains and losses from the Company’s short-term and long-term investments are reported in other comprehensive income (loss). At June 30, 2018, all of the Company’s short-term and long-term investments are classified as available for sale investments and are determined to be Level 2 instruments, which are measured at fair value using standard industry models with observable inputs. The fair value of the commercial paper is measured based on a standard industry model that uses the three-month U.S. Treasury bill rate as an observable input. The fair value of the asset-backed securities and corporate bonds is principally measured or corroborated by trade data for identical issues in which related trading activity is not sufficiently frequent to be considered a Level 1 input or that of comparable securities. At June 30, 2018, all short-term and long-term investments were rated A or better by Standard & Poor’s.

The following summarizes the Company’s investments at June 30, 2018 and December 31, 2017 (in thousands):



June 30, 2018 Debt Securities	Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value (Level 2)
Short-term:
Asset-backed securities	$	47,341	$	—	$	(152	)	$	47,189
Commercial paper	72,447		8		(3		)	72,452
Corporate bonds	135,206		—		(397		)	134,809
Subtotal	254,994		8		(552		)	254,450
Long-term:
Corporate bonds	1,602		—		(1		)	1,601
Subtotal	1,602		—		(1		)	1,601
Total	$	256,596	$	8	$	(553	)	$	256,051



December 31, 2017 Debt Securities	Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value (Level 2)
Short-term:
Asset-backed securities	$	28,338	$	—	$	(37	)	$	28,301
Commercial paper	48,999		—		(23		)	48,976
Corporate bonds	180,119		—		(175		)	179,944
Subtotal	257,456		—		(235		)	257,221
Long-term:
Asset-backed securities	23,836		—		(79		)	23,757
Corporate bonds	36,430		—		(140		)	36,290
Subtotal	60,266		—		(219		)	60,047
Total	$	317,722	$	—	$	(454	)	$	317,268

Certain assets and liabilities are measured at fair value on a nonrecurring basis, including assets and liabilities acquired in a business combination, and long-lived assets, which would be recognized at fair value if deemed to be impaired or if reclassified as assets held for sale. The fair value in these instances would be determined using Level 3 inputs.

TELA Bio, Inc.

In October 2017, the Company made a cash investment of $15.0 million in Series B Preferred Stock of TELA Bio Inc., or TELA Bio, a privately-held surgical reconstruction company that markets its proprietary OviTex^TM portfolio of products for ventral hernia repair and abdominal wall reconstruction. In conjunction with the investment in TELA Bio, the Company acquired an option to purchase an additional $10.0 million of Series B Preferred Stock under the same terms and conditions as existed on the initial purchase date. The purchase option expires on September 15, 2018. If the Company does not exercise its purchase option, the Company may be required to invest up to $10.0 million in Series B Preferred Stock under certain conditions. This contingent purchase obligation expires on October 31, 2018.

The investment in TELA Bio, the purchase option and the contingent purchase obligation were recorded at fair value based on integrated valuation pricing models. These models included both unobservable and observable market inputs including option purchase price, volatility and projected liquidity date. The equity investment in the Series B Preferred Stock was recorded at $14.1 million and the purchase option was recorded in prepaid expenses and other current assets at $0.9 million. The fair value of the contingent purchase obligation was determined to be de minimis.

Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents, short-term investments, long-term investments and accounts receivable. The Company maintains its cash and cash equivalents with high-credit quality financial institutions. Such amounts may exceed federally-insured limits.

As of June 30, 2018, three wholesalers each accounted for over 10% of the Company’s accounts receivable, at 31%, 28% and 24%, respectively. At December 31, 2017, three wholesalers each accounted for over 10% of the Company’s accounts receivable, at 35%, 30% and 27%, respectively. For additional information regarding the Company’s wholesalers, see Note 2, Summary of Significant Accounting Policies. Revenues are primarily derived from major wholesalers and pharmaceutical companies that generally have significant cash resources. The Company performs ongoing credit evaluations of its customers as warranted and generally does not require collateral. Allowances for doubtful accounts receivable are maintained based on historical payment patterns, aging of accounts receivable and the Company’s actual write-off history. As of June 30, 2018 and December 31, 2017, no allowances for doubtful accounts were deemed necessary by the Company on its accounts receivable.

STOCK PLANS

6 Months Ended

Jun. 30, 2018

Stockholders' Equity Note [Abstract]

STOCK PLANS

Stock-Based Compensation

The Company recognized stock-based compensation expense in the periods presented as follows (in thousands):



	Three Months Ended June 30,				Six Months Ended June 30,
	2018		2017		2018		2017
Cost of goods sold	$	1,046	$	1,395	$	2,252	$	2,770
Research and development	951		647		1,648		1,304
Selling, general and administrative	5,050		5,303		11,532		10,670
Total	$	7,047	$	7,345	$	15,432	$	14,744

Stock-based compensation from:
Stock options (employee awards)	$	4,827	$	5,741	$	11,182	$	11,658
Stock options (consultant awards)	202		29		241		83
Restricted stock units (employee awards)	1,819		1,389		3,609		2,611
Employee stock purchase plan	199		186		400		392
Total	$	7,047	$	7,345	$	15,432	$	14,744

Equity Awards

The following tables contain information about the Company’s stock option and restricted stock unit, or RSU, activity for the six months ended June 30, 2018:



Stock Options	Number of Options		Weighted Average Exercise Price
Outstanding at December 31, 2017	4,951,493		$	43.51
Granted	1,683,007		38.33
Exercised	(103,263	)	14.45
Forfeited	(242,188	)	44.43
Expired	(253,483	)	64.19
Outstanding at June 30, 2018	6,035,566		41.65



Restricted Stock Units	Number of Units		Weighted Average Grant Date Fair Value
Unvested at December 31, 2017	499,546		$	47.32
Granted	327,779		38.33
Vested	(147,844	)	49.70
Forfeited	(42,722	)	45.86
Unvested at June 30, 2018	636,759		42.23

The weighted average fair value of stock options granted during the six months ended June 30, 2018 was $18.85 per share. The fair values of stock options granted were estimated using the Black-Scholes option valuation model with the following weighted average assumptions:



		Six Months Ended June 30, 2018
Expected dividend yield		None
Risk-free interest rate		2.78%
Expected volatility		53.2%
Expected term of options		5.21 years

Employee Stock Purchase Plan

The Company’s 2014 Employee Stock Purchase Plan, or ESPP, features two six-month offering periods per year, running from January 1to June 30 and July 1 to December 31. Under the ESPP, employees may elect to contribute after-tax earnings to purchase shares at 85% of the closing fair market value of the Company’s common stock on either the offering date or the purchase date, whichever is less. During the six months ended June 30, 2018, 34,985 shares were purchased and issued under the ESPP.

STOCKHOLDERS' EQUITY

6 Months Ended

Jun. 30, 2018

Stockholders' Equity Note [Abstract]

Stockholders' Equity

STOCKHOLDERS’ EQUITY

Accumulated Other Comprehensive Income (Loss)

The following table illustrates the changes in the balances of the Company’s accumulated other comprehensive income (loss) for the periods presented (in thousands):



	Six Months Ended June 30,
Net unrealized gains (losses) from available for sale investments:	2018			2017
Balance at beginning of period	$	(454	)	$	(30	)
Other comprehensive loss before reclassifications	(91		)	(34		)
Amounts reclassified from accumulated other comprehensive income (loss)	—			—
Balance at end of period	$	(545	)	$	(64	)

NET INCOME (LOSS) PER SHARE

6 Months Ended

Jun. 30, 2018

Earnings Per Share [Abstract]

NET INCOME (LOSS) PER SHARE

Basic net income (loss) per share is calculated by dividing the net income (loss) attributable to common shares by the weighted average number of common shares outstanding during the period. Diluted net income (loss) per common share is calculated by dividing the net income (loss) attributable to common shares by the weighted average number of common shares outstanding plus dilutive potential common shares outstanding during the period. Potential common shares include the shares of common stock issuable upon the exercise of outstanding stock options, the vesting of RSUs and the purchase of shares from the ESPP (using the treasury stock method) as well as the conversion of the excess conversion value on the 2022 Notes. As discussed in Note 7, Debt, the Company has the option to pay cash for the aggregate principal amount due upon the conversion of its 2022 Notes. Since it is the Company’s intent to settle the principal amount of its 2022 Notes in cash, the potentially dilutive effect of such notes on net income (loss) per share is computed under the treasury stock method. The Company must settle the principal of its 2019 Notes in cash and also intends to settle any conversion premium in cash.

Potential common shares are excluded from the diluted net income (loss) per share computation to the extent they would be antidilutive. Because the Company reported a net loss for the three months ended June 30, 2017 and the six months ended June 30, 2018 and 2017, no potentially dilutive securities have been included in the computation of diluted net loss per share for those periods.

The following table sets forth the computation of basic and diluted net income (loss) per share for the three and six months ended June 30, 2018 and 2017 (in thousands, except per share amounts):



	Three Months Ended June 30,					Six Months Ended June 30,
	2018		2017			2018			2017
Numerator:
Net income (loss)	$	2,564	$	(19,743	)	$	(8,116	)	$	(39,609	)
Denominator:
Weighted average common shares outstanding	40,796		40,160			40,751			39,079
Computation of diluted securities:
Dilutive effect of stock options	807		—			—			—
Dilutive effect of RSUs	87		—			—			—
Dilutive effect of ESPP purchase options	4		—			—			—
Weighted average common shares outstanding—diluted	41,694		40,160			40,751			39,079
Net loss per share:
Basic and diluted net income (loss) per common share	$	0.06	$	(0.49	)	$	(0.20	)	$	(1.01	)

The following outstanding stock options, RSUs, conversion premiums on the Company’s convertible senior notes and ESPP purchase options are antidilutive in the periods presented (in thousands):



	Three Months Ended June 30,		Six Months Ended June 30,
	2018	2017	2018	2017
Weighted average number of stock options	3,918	5,092	5,094	5,102
Weighted average number of RSUs	367	375	483	364
Conversion premium on the 2019 Notes	—	9	—	817
Weighted average ESPP purchase options	5	36	33	37
Total	4,290	5,512	5,610	6,320

INCOME TAXES

6 Months Ended

Jun. 30, 2018

Income Tax Disclosure [Abstract]

TAXES

INCOME TAXES

Income (loss) before income taxes is as follows (in thousands):



	Three Months Ended June 30,					Six Months Ended June 30,
	2018		2017			2018			2017
Income (loss) before income taxes:
Domestic	$	592	$	(18,950	)	$	(9,221	)	$	(38,269	)
Foreign	2,007		(763		)	1,175			(1,280		)
Total income (loss) before income taxes	$	2,599	$	(19,713	)	$	(8,046	)	$	(39,549	)

The Company recorded income tax expense of less than $0.1 million in both the three and six month periods ended June 30, 2018 and 2017, respectively. The tax provisions reflect current state income taxes. Due to net operating losses, or NOLs, carried forward to 2018 and the repeal of the corporate minimum tax, no current federal income tax expense was recorded for 2018. The utilization of the Company’s NOLs did not result in any deferred federal tax expense because there was a full valuation allowance recorded with respect to the NOLs. Due to net taxable losses in 2017, no current federal income tax expense was recorded in that year. The tax provisions do not reflect deferred tax expenses because the Company’s deferred tax assets are fully offset by a valuation allowance.

During the six months ended June 30, 2017, the Company established a deferred tax liability of $26.5 million with an offset to additional paid-in capital resulting from the conversion feature of the 2022 Notes. The initial difference between the book value of convertible debt issued with a beneficial conversion feature and its tax basis is a temporary difference. The net effect of the deferred tax liability recorded to additional paid-in capital was zero because the Company has a full valuation allowance against its net deferred tax assets.

COMMITMENTS AND CONTINGENCIES

6 Months Ended

Jun. 30, 2018

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

Leases

The Company’s leases for its research and development, warehouse and DepoCyt(e) manufacturing facility in San Diego, California all expire in August 2020, and its lease for its EXPAREL manufacturing facility in San Diego, California expires in December 2025. The Company’s lease for its corporate headquarters in Parsippany, New Jersey expires in March 2028.

As of June 30, 2018, aggregate annual minimum payments due under the Company’s lease obligations are as follows (in thousands):



Year	Aggregate Minimum Payments Due
2018 (remaining six months)	$	3,933
2019	8,122
2020	7,604
2021	5,245
2022	5,366
2023 through 2028	19,577
Total	$	49,847

Litigation

From time to time, the Company has been and may again become involved in legal proceedings arising in the ordinary course of its business, including those related to patents, product liability and government investigations. Except as described below, the Company is not presently a party to any legal proceedings which it believes to be material, and is not aware of any pending or threatened litigation against the Company which it believes could have a material adverse effect on its business, operating results, financial condition or cash flows.

In April 2015, the Company received a subpoena from the U.S. Department of Justice, U.S. Attorney’s Office for the District of New Jersey, requiring the production of a broad range of documents pertaining to marketing and promotional practices related to EXPAREL. The Company is cooperating with the government’s inquiry. The Company can make no assurances as to the time or resources that will need to be devoted to this inquiry or its final outcome, or the impact, if any, of this inquiry or any proceedings on its business, financial condition, results of operations and cash flows.

COMMERCIAL PARTNERS AND OTHER AGREEMENTS

6 Months Ended

Jun. 30, 2018

Organization, Consolidation and Presentation of Financial Statements [Abstract]

COMMERCIAL PARTNERS AND OTHER AGREEMENTS

DepoCyt(e) Discontinuation

In June 2017, the Company’s board of directors approved a decision to discontinue all future production of DepoCyt^® (U.S. and Canada) and DepoCyte^® (European Union) due to persistent technical issues specific to the DepoCyt(e) manufacturing process. As of June 30, 2017, the Company had ceased all production of DepoCyt(e).

In the three and six months ended June 30, 2018, the Company recorded a non-recurring charge of $0.2 million and $0.3 million, respectively, related to the discontinuation of its DepoCyt(e) manufacturing activities for lease costs, asset retirement obligations and other estimated exit costs.

In the three and six months ended June 30, 2017, the Company recorded a non-recurring charge of $5.0 million related to the discontinuation of its DepoCyt(e) manufacturing activities, including $0.5 million for DepoCyt(e) related inventory, which was recorded in cost of goods sold, and $4.5 million for the remaining lease costs less an estimate of potential sublease income for the facility where DepoCyt(e) was manufactured, the write-off of property, plant and equipment, employee severance, asset retirement obligations and other estimated exit costs.

As of June 30, 2018, a summary of the Company’s costs and reserves related to the DepoCyt(e) discontinuation are as follows (in thousands):



	Lease Costs			Asset Retirement Obligations and Other Discontinuation Costs			Total
Balance at December 31, 2017	$	1,274		$	236		$	1,510
Charges incurred	216			36			252
Cash payments made	(668		)	(31		)	(699		)
Other	80			16			96
Balance at June 30, 2018	$	902		$	257		$	1,159

In April 2018, the Company received formal notice of the termination of a Supply Agreement and a Distribution Agreement (and all related agreements as subsequently amended) from Mundipharma International Corporation Limited and Mundipharma Medical Company, respectively. The Company may be required to make additional payments or incur additional costs relating to the DepoCyt(e) discontinuation which could be material to the Company’s results of operations and/or cash flows in a given period.

Nuance Biotech Co. Ltd.

In June 2018, the Company entered into an agreement with Nuance Biotech Co. Ltd., or Nuance, a China-based specialty pharmaceutical company, to advance the development and commercialization of EXPAREL in China. Under the terms of the agreement, the Company agreed to be the sole supplier of EXPAREL to Nuance and has granted Nuance the exclusive rights to develop and commercialize EXPAREL in China. The Company received an upfront payment of $3.0 million in July 2018 and is eligible to receive future milestone payments of up to $60.0 million that are triggered by filing for and securing regulatory approval(s) and annual sales in China exceeding certain levels. The Company is also entitled to tiered royalties as a percentage of net sales.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	6 Months Ended
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	Jun. 30, 2018
Accounting Policies [Abstract]
Basis of Presentation and Principles of Consolidation	Basis of Presentation and Principles of Consolidation These interim condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America, or GAAP, and in accordance with the rules and regulations of the Securities and Exchange Commission, or SEC, for interim reporting. Pursuant to these rules and regulations, certain information and footnote disclosures normally included in complete annual financial statements have been condensed or omitted. Therefore, these interim condensed consolidated financial statements should be read in conjunction with the audited annual consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017. The condensed consolidated financial statements at June 30, 2018, and for the three and six month periods ended June 30, 2018 and 2017, are unaudited, but include all adjustments (consisting of only normal recurring adjustments) which, in the opinion of management, are necessary to present fairly the financial information set forth herein in accordance with GAAP. The condensed consolidated balance sheet at December 31, 2017 is derived from the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017. The consolidated financial statements as presented reflect certain reclassifications from previously issued financial statements to conform to the current year presentation. The accounts of wholly-owned subsidiaries are included in the condensed consolidated financial statements. Intercompany accounts and transactions have been eliminated in consolidation. The results of operations for the interim periods are not necessarily indicative of results that may be expected for any other interim periods or for the full year.
Concentration of Major Customers	Concentration of Major Customers The Company sells EXPAREL through a drop-ship program under which orders are processed through wholesalers (including AmerisourceBergen Health Corporation, Cardinal Health, Inc. and McKesson Drug Company), but shipments of the product are sent directly to individual accounts, such as hospitals, ambulatory surgery centers and individual doctors.
Recent Accounting Pronouncements	Recently Adopted Accounting Pronouncements In May 2014, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update, or ASU, 2014-09, Revenue from Contracts with Customers, and subsequently issued a number of amendments to this update. The new standard, as amended in Accounting Standards Codification, or ASC, 606, provides a single comprehensive model to be used in accounting for revenue arising from contracts with customers and supersedes previous revenue recognition guidance. The standard’s stated core principle is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In addition, the standard requires disclosure of the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. The Company adopted this standard on January 1, 2018 using the modified retrospective method and recorded a cumulative effect adjustment of $1.4 million to accumulated deficit upon adoption—with the impact related to the acceleration of $1.0 million of deferred revenue and $0.4 million of royalties. Under the modified retrospective method of adoption, the comparative information in the consolidated financial statements has not been revised and continues to be reported under the previously applicable revenue accounting guidance, ASC 605. The implementation of ASC 606 did not have a material impact on the Company’s consolidated statements of operations because the timing of revenue recognition for EXPAREL product sales did not change. The Company is recognizing existing collaborative licensing, milestone and royalty revenue earlier, subject to the variable consideration constraints, than it would have under the previous standard. If ASC 605 had been applied to each of the first and second quarters of 2018, deferred revenue would have been $1.0 million higher on the consolidated balance sheet, with $0.1 million in accrued expenses and current portion of deferred revenue and $0.9 million in other liabilities. Under ASC 605, royalty revenue and accounts receivable for both the three and six months ended June 30, 2018 would have been lower by $0.4 million. For additional information regarding the Company’s revenue, see Note 3, Revenue. In January 2016, the FASB issued ASU 2016-01, Financial Instruments—Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. ASU 2016-01 changes accounting for equity investments and presentation and disclosure requirements for financial instruments. ASU 2016-01 does not apply to equity investments in consolidated subsidiaries or those accounted for under the equity method of accounting. Equity investments with readily determinable fair values will be measured at fair value with changes in fair value recognized in net income (loss). Entities have the option to measure equity investments without readily determinable fair values either at fair value or at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. The standard also simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment. When a qualitative assessment indicates that impairment exists, an entity is required to measure the investment at fair value. ASU 2016-01 became effective for the Company beginning January 1, 2018. The Company has elected to measure equity investments without readily determinable fair values at cost adjusted for changes in observable prices. The guidance related to equity investments without readily determinable fair values is being applied prospectively to the Company’s investment in TELA Bio, Inc. The adoption of ASU 2016-01 may increase volatility in the Company’s net income as changes in observable prices of equity investments without readily determinable fair values will be recorded in net income (loss). The implementation of this standard did not have a material impact on the Company’s consolidated financial statements and related disclosures. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments, which clarifies existing guidance on how companies present and classify certain cash receipts and cash payments in the statement of cash flows by addressing specific cash flow issues in an effort to reduce diversity in practice, including guidance on debt prepayment or extinguishment costs and contingent consideration payments made after a business combination. ASU 2016-15 became effective for the Company on January 1, 2018 and did not have a material impact on the Company’s consolidated statement of cash flows. In June 2018, the FASB issued ASU 2018-07, Compensation—Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting, which aligns accounting for share-based payments issued to nonemployees to that of employees under the existing guidance of Topic 718, with certain exceptions. This update supersedes previous guidance for equity-based payments to nonemployees under Subtopic 505-50, Equity—Equity-Based Payments to Non-Employees. The Company chose to early adopt ASU 2018-07 in June 2018 and recorded a cumulative effect adjustment of less than $0.1 million to accumulated deficit upon adoption. Recent Accounting Pronouncements Not Adopted as of June 30, 2018 In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) and subsequently issued clarifications and corrections to the update by issuing ASU 2018-10 in July 2018. This update requires lessees to recognize lease assets and lease liabilities on the balance sheet for those leases classified as operating leases under previous authoritative guidance. The lease liability will be equal to the present value of lease payments and the right-of-use asset will be based on the lease liability, subject to adjustment for items such as initial direct costs. For income statement purposes, the new standard retains a dual model similar to ASC 840, requiring leases to be classified as either operating or financing. For lessees, operating leases will result in straight-line expense (similar to current accounting by lessees for operating leases under ASC 840) while financing leases will result in a front-loaded expense pattern (similar to current accounting by lessees for capital leases under ASC 840). This update also introduces new disclosure requirements for leasing arrangements. The standard will become effective for the Company beginning January 1, 2019. Early adoption is permitted, although the Company does not expect to do so. The Company is currently evaluating the impact of ASU 2016-02 on its consolidated financial statements. For operating leases it will result in the recognition of lease liabilities and corresponding right-of-use assets upon adoption, which will have a material impact on the Company’s consolidated balance sheet. The Company does not believe the adoption of this ASU will have a significant impact on its consolidated statements of operations, stockholders’ equity or cash flows. At adoption, this update will be applied using a modified retrospective approach. Refer to Note 13, Commitments and Contingencies, for further discussion on the Company’s leases. In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326), which requires entities to measure all expected credit losses for financial assets held at the reporting date based on historical experience, current conditions and reasonable and supportable forecasts. Entities will now use forward-looking information to better form their credit loss estimates. This update also requires enhanced disclosures to help financial statement users better understand significant estimates and judgments used in estimating credit losses, as well as the credit quality and underwriting standards of an entity’s portfolio. This ASU will become effective for the Company beginning January 1, 2020, with early adoption permitted. The Company is currently evaluating the impact of ASU 2016-13 on its consolidated financial statements. Other pronouncements issued by the FASB or other authoritative accounting standards groups with future effective dates are either not applicable or not significant to the consolidated financial statements of the Company.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

6 Months Ended

Jun. 30, 2018

Accounting Policies [Abstract]

Schedule of percentage of revenue comprised by the three largest customers (i.e. wholesalers or commercial partners)

The table below includes the percentage of sales processed by the Company’s three largest wholesalers in each period presented:



	Three Months Ended June 30,		Six Months Ended June 30,
	2018	2017	2018	2017
Largest wholesaler	33%	35%	33%	35%
Second largest wholesaler	29%	29%	30%	29%
Third largest wholesaler	25%	25%	26%	25%
Total	87%	89%	89%	89%

REVENUE (Tables)

6 Months Ended

Jun. 30, 2018

Revenue from Contract with Customer [Abstract]

Disaggregated Revenue

The following table represents disaggregated net product sales in the periods presented as follows (in thousands):



	Three Months Ended June 30,				Six Months Ended June 30,
	Three Months Ended June 30,				Six Months Ended June 30,
	2018		2017		2018		2017
Net product sales:
EXPAREL	$	80,430	$	69,773	$	154,464	$	137,474
Other product sales	287		366		540		1,090
Total net product sales	$	80,717	$	70,139	$	155,004	$	138,564

INVENTORIES (Tables)

6 Months Ended

Jun. 30, 2018

Inventory Disclosure [Abstract]

Schedule of components of inventories

The components of inventories are as follows (in thousands):



	June 30,		December 31,
	2018		2017
Raw materials	$	16,070	$	16,500
Work-in-process	7,331		8,371
Finished goods	18,652		16,540
Total	$	42,053	$	41,411

FIXED ASSETS (Tables)

6 Months Ended

Jun. 30, 2018

Property, Plant and Equipment [Abstract]

Schedule of fixed assets summarized by major category

Fixed assets, summarized by major category, consist of the following (in thousands):



	June 30,			December 31,
	2018			2017
Machinery and laboratory equipment	$	41,809		$	39,002
Leasehold improvements	34,932			34,933
Computer equipment and software	7,448			7,086
Office furniture and equipment	1,420			1,603
Construction in progress	79,670			73,632
Total	165,279			156,256
Less: accumulated depreciation	(54,003		)	(49,210		)
Fixed assets, net	$	111,276		$	107,046

GOODWILL AND INTANGIBLE ASSETS (Tables)

6 Months Ended

Jun. 30, 2018

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Goodwill

The change in the carrying value of goodwill is summarized as follows (in thousands):



	Carrying Value
Balance at December 31, 2017	$	55,197
Percentage payments on collections of net sales of DepoBupivacaine products	4,715
Balance at June 30, 2018	$	59,912

DEBT (Tables)

6 Months Ended

Jun. 30, 2018

Debt Disclosure [Abstract]

Schedule of composition of the Company's debt and financing obligations

The total debt composition of the 2022 Notes is as follows (in thousands):



	June 30,			December 31,
	2018			2017
2.375% convertible senior notes due 2022	$	345,000		$	345,000
Deferred financing costs	(6,675		)	(7,482		)
Discount on debt	(55,067		)	(61,345		)
Total debt, net of debt discount and deferred financing costs	$	283,258		$	276,173

Schedule of total interest expense recognized related to the Notes

The following table sets forth the total interest expense recognized in the periods presented (dollar amounts in thousands):



	Three Months Ended June 30,						Six Months Ended June 30,
	2018			2017			2018			2017
Contractual interest expense	$	2,051		$	2,053		$	4,102		$	3,242
Amortization of debt issuance costs	406			389			808			590
Amortization of debt discount	3,170			2,951			6,283			4,362
Capitalized interest and other (Note 5)	(230		)	(167		)	(640		)	(379		)
Total	$	5,397		$	5,226		$	10,553		$	7,815

Effective interest rate on convertible senior notes	7.81		%	7.81		%	7.81		%	7.70		%

FINANCIAL INSTRUMENTS (Tables)

6 Months Ended

Jun. 30, 2018

Fair Value Disclosures [Abstract]

Schedule of carrying amount and fair value of the long-term debt

The carrying amount and fair value of the Company’s convertible senior notes are as follows (in thousands):



Financial Liabilities Carried at Historical Cost	Carrying Value		Fair Value Measurements Using
June 30, 2018	Carrying Value		Level 1		Level 2		Level 3
2.375% convertible senior notes due 2022 ⁽¹⁾	$	283,258	$	—	$	322,351	$	—
3.25% convertible senior notes due 2019 ⁽²⁾	$	330	$	—	$	446	$	—

Schedule of short-term investments

The following summarizes the Company’s investments at June 30, 2018 and December 31, 2017 (in thousands):



June 30, 2018 Debt Securities	Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value (Level 2)
Short-term:
Asset-backed securities	$	47,341	$	—	$	(152	)	$	47,189
Commercial paper	72,447		8		(3		)	72,452
Corporate bonds	135,206		—		(397		)	134,809
Subtotal	254,994		8		(552		)	254,450
Long-term:
Corporate bonds	1,602		—		(1		)	1,601
Subtotal	1,602		—		(1		)	1,601
Total	$	256,596	$	8	$	(553	)	$	256,051



December 31, 2017 Debt Securities	Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value (Level 2)
Short-term:
Asset-backed securities	$	28,338	$	—	$	(37	)	$	28,301
Commercial paper	48,999		—		(23		)	48,976
Corporate bonds	180,119		—		(175		)	179,944
Subtotal	257,456		—		(235		)	257,221
Long-term:
Asset-backed securities	23,836		—		(79		)	23,757
Corporate bonds	36,430		—		(140		)	36,290
Subtotal	60,266		—		(219		)	60,047
Total	$	317,722	$	—	$	(454	)	$	317,268

STOCK PLANS (Tables)

6 Months Ended

Jun. 30, 2018

Stockholders' Equity Note [Abstract]

Schedule of recognized stock-based compensation in consolidated statements of operations

The Company recognized stock-based compensation expense in the periods presented as follows (in thousands):



	Three Months Ended June 30,				Six Months Ended June 30,
	2018		2017		2018		2017
Cost of goods sold	$	1,046	$	1,395	$	2,252	$	2,770
Research and development	951		647		1,648		1,304
Selling, general and administrative	5,050		5,303		11,532		10,670
Total	$	7,047	$	7,345	$	15,432	$	14,744

Stock-based compensation from:
Stock options (employee awards)	$	4,827	$	5,741	$	11,182	$	11,658
Stock options (consultant awards)	202		29		241		83
Restricted stock units (employee awards)	1,819		1,389		3,609		2,611
Employee stock purchase plan	199		186		400		392
Total	$	7,047	$	7,345	$	15,432	$	14,744

Schedule of the Company's stock option activity and related information

The following tables contain information about the Company’s stock option and restricted stock unit, or RSU, activity for the six months ended June 30, 2018:



Stock Options	Number of Options		Weighted Average Exercise Price
Outstanding at December 31, 2017	4,951,493		$	43.51
Granted	1,683,007		38.33
Exercised	(103,263	)	14.45
Forfeited	(242,188	)	44.43
Expired	(253,483	)	64.19
Outstanding at June 30, 2018	6,035,566		41.65



Restricted Stock Units	Number of Units		Weighted Average Grant Date Fair Value
Unvested at December 31, 2017	499,546		$	47.32
Granted	327,779		38.33
Vested	(147,844	)	49.70
Forfeited	(42,722	)	45.86
Unvested at June 30, 2018	636,759		42.23

STOCKHOLDERS' EQUITY (Tables)

6 Months Ended

Jun. 30, 2018

Stockholders' Equity Note [Abstract]

Schedule of accumulated other comprehensive income (loss)

The following table illustrates the changes in the balances of the Company’s accumulated other comprehensive income (loss) for the periods presented (in thousands):



	Six Months Ended June 30,
Net unrealized gains (losses) from available for sale investments:	2018			2017
Balance at beginning of period	$	(454	)	$	(30	)
Other comprehensive loss before reclassifications	(91		)	(34		)
Amounts reclassified from accumulated other comprehensive income (loss)	—			—
Balance at end of period	$	(545	)	$	(64	)

NET INCOME (LOSS) PER SHARE (Tables)

6 Months Ended

Jun. 30, 2018

Earnings Per Share [Abstract]

Schedule of computation of basic and diluted loss per share

The following table sets forth the computation of basic and diluted net income (loss) per share for the three and six months ended June 30, 2018 and 2017 (in thousands, except per share amounts):



	Three Months Ended June 30,					Six Months Ended June 30,
	2018		2017			2018			2017
Numerator:
Net income (loss)	$	2,564	$	(19,743	)	$	(8,116	)	$	(39,609	)
Denominator:
Weighted average common shares outstanding	40,796		40,160			40,751			39,079
Computation of diluted securities:
Dilutive effect of stock options	807		—			—			—
Dilutive effect of RSUs	87		—			—			—
Dilutive effect of ESPP purchase options	4		—			—			—
Weighted average common shares outstanding—diluted	41,694		40,160			40,751			39,079
Net loss per share:
Basic and diluted net income (loss) per common share	$	0.06	$	(0.49	)	$	(0.20	)	$	(1.01	)

Schedule of potential dilutive effect of the securities excluded from the calculation of diluted loss per share

The following outstanding stock options, RSUs, conversion premiums on the Company’s convertible senior notes and ESPP purchase options are antidilutive in the periods presented (in thousands):



	Three Months Ended June 30,		Six Months Ended June 30,
	2018	2017	2018	2017
Weighted average number of stock options	3,918	5,092	5,094	5,102
Weighted average number of RSUs	367	375	483	364
Conversion premium on the 2019 Notes	—	9	—	817
Weighted average ESPP purchase options	5	36	33	37
Total	4,290	5,512	5,610	6,320

INCOME TAXES (Tables)

6 Months Ended

Jun. 30, 2018

Income Tax Disclosure [Abstract]

Schedule of Income before Income Tax, Domestic and Foreign

Income (loss) before income taxes is as follows (in thousands):



	Three Months Ended June 30,					Six Months Ended June 30,
	2018		2017			2018			2017
Income (loss) before income taxes:
Domestic	$	592	$	(18,950	)	$	(9,221	)	$	(38,269	)
Foreign	2,007		(763		)	1,175			(1,280		)
Total income (loss) before income taxes	$	2,599	$	(19,713	)	$	(8,046	)	$	(39,549	)

COMMITMENTS AND CONTINGENCIES (Tables)

6 Months Ended

Jun. 30, 2018

Commitments and Contingencies Disclosure [Abstract]

Schedule of future minimum lease payments

As of June 30, 2018, aggregate annual minimum payments due under the Company’s lease obligations are as follows (in thousands):



Year	Aggregate Minimum Payments Due
2018 (remaining six months)	$	3,933
2019	8,122
2020	7,604
2021	5,245
2022	5,366
2023 through 2028	19,577
Total	$	49,847

COMMERCIAL PARTNERS AND OTHER AGREEMENTS (Tables)

6 Months Ended

Jun. 30, 2018

Organization, Consolidation and Presentation of Financial Statements [Abstract]

COMMERCIAL PARTNERS AND OTHER AGREEMENTS

As of June 30, 2018, a summary of the Company’s costs and reserves related to the DepoCyt(e) discontinuation are as follows (in thousands):



	Lease Costs			Asset Retirement Obligations and Other Discontinuation Costs			Total
Balance at December 31, 2017	$	1,274		$	236		$	1,510
Charges incurred	216			36			252
Cash payments made	(668		)	(31		)	(699		)
Other	80			16			96
Balance at June 30, 2018	$	902		$	257		$	1,159

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - Concentration risk by major customer - customer	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Concentration of Major Customers
Number of major customers			3
Net revenue
Concentration of Major Customers
Percentage of revenue from customers to total revenue	87.00%	89.00%	89.00%	89.00%
Net revenue \| Largest wholesaler
Concentration of Major Customers
Percentage of revenue from customers to total revenue	33.00%	35.00%	33.00%	35.00%
Net revenue \| Second largest wholesaler
Concentration of Major Customers
Percentage of revenue from customers to total revenue	29.00%	29.00%	30.00%	29.00%
Net revenue \| Third largest wholesaler
Concentration of Major Customers
Percentage of revenue from customers to total revenue	25.00%	25.00%	26.00%	25.00%

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES New Accounting Pronouncements or change in Accounting Policy (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Accumulated deficit	$ (395,871)		$ (395,871)		$ (389,136)
Deferred revenue	1,000		1,000
Royalty revenue	390	$ 665	710	$ 1,317
Accounting Standards Update 2014-09 \| Difference between Revenue Guidance in Effect before and after Topic 606
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Accumulated deficit					1,400
Deferred revenue					1,000
Royalties	400		400		$ 400
Royalty revenue	400		400
Accounting Standards Update 2014-09 \| Difference between Revenue Guidance in Effect before and after Topic 606 \| Accrued expenses and current portion of deferred revenue
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Deferred revenue	100		100
Accounting Standards Update 2014-09 \| Difference between Revenue Guidance in Effect before and after Topic 606 \| Other liabilities
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Deferred revenue	$ 900		$ 900

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Stock-Based Compensation, Initial Application Period Cumulative Effect Transition (Details) $ in Millions	Jun. 30, 2018 USD ($)
Accounting Policies [Abstract]
Cumulative Effect on Retained Earnings, Net of Tax	$ 0.1

REVENUE (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
REVENUE (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Disaggregation of Revenue [Line Items]
Total net product sales	$ 80,717	$ 70,139	$ 155,004	$ 138,564
EXPAREL
Disaggregation of Revenue [Line Items]
Total net product sales	80,430	69,773	154,464	137,474
Other product sales
Disaggregation of Revenue [Line Items]
Total net product sales	$ 287	$ 366	$ 540	$ 1,090
Minimum [Member]
Disaggregation of Revenue [Line Items]
Accounts Receivable, Additional Narrative Disclosure			0
Maximum [Member]
Disaggregation of Revenue [Line Items]
Accounts Receivable, Additional Narrative Disclosure			37

- Definition

Further narrative disclosure of claims held for amounts due a company. Examples include trade accounts receivables, notes receivables, loans receivables, etc.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 310
-SubTopic 10
-Section 50
-Paragraph 4
-URI http://asc.fasb.org/extlink&oid=84173941&loc=d3e5074-111524

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 310
-SubTopic 10
-Section 45
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=82891408&loc=d3e4428-111522

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 310
-SubTopic 10
-Section 50
-Paragraph 7
-URI http://asc.fasb.org/extlink&oid=84173941&loc=d3e5111-111524

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(3))
-URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 310
-SubTopic 10
-Section 50
-Paragraph 9
-URI http://asc.fasb.org/extlink&oid=84173941&loc=d3e5144-111524

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 310
-SubTopic 10
-Section 50
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=84173941&loc=d3e5130-111524

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 310
-SubTopic 10
-Section 50
-Paragraph 5
-URI http://asc.fasb.org/extlink&oid=84173941&loc=d3e5086-111524

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 310
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=84173941&loc=d3e5066-111524

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 45
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=64930785&loc=d3e28551-108399

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 860
-SubTopic 20
-Section 50
-Paragraph 5
-URI http://asc.fasb.org/extlink&oid=82924980&loc=d3e107425-111719

+ Details

INVENTORIES (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Dec. 31, 2017
Inventory Disclosure [Abstract]
Raw materials	$ 16,070	$ 16,500
Work-in-process	7,331	8,371
Finished goods	18,652	16,540
Total	$ 42,053	$ 41,411

FIXED ASSETS (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
FIXED ASSETS (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
FIXED ASSETS
Total	$ 165,279		$ 165,279		$ 156,256
Less: accumulated depreciation	(54,003)		(54,003)		(49,210)
Fixed assets, net	111,276		111,276		107,046
Depreciation expense	2,800	$ 3,700	5,600	$ 6,800
Capitalized interest (Note 4)	200	$ 200	600	$ 400
Foreign Property, Plant and Equipment, Net	65,200		65,200		59,800
Machinery and laboratory equipment
FIXED ASSETS
Total	41,809		41,809		39,002
Leasehold improvements
FIXED ASSETS
Total	34,932		34,932		34,933
Computer equipment and software
FIXED ASSETS
Total	7,448		7,448		7,086
Office furniture and equipment
FIXED ASSETS
Total	1,420		1,420		1,603
Construction in progress
FIXED ASSETS
Total	$ 79,670		$ 79,670		$ 73,632

GOODWILL AND INTANGIBLE ASSETS (Details) - USD ($)	Jun. 30, 2018	Dec. 31, 2017	Apr. 30, 2012
Goodwill
Payment obligation arising in connection with the acquisition			$ 10,000,000
Contingent consideration liability recognized at the time of the acquisition			2,000,000
Goodwill recorded in connection with the acquisition	$ 59,912,000	$ 55,197,000	$ 8,000,000
Goodwill recorded for the percentage payments on net sales of EXPAREL collected	35,900,000
Upon first commercial sale in the United States
Goodwill
Milestone payments for EXPAREL agreed in connection with acquisition	10,000,000.0
Upon first commercial sale in a major EU country (United Kingdom, France, Germany, Italy and Spain)
Goodwill
Milestone payments for EXPAREL agreed in connection with acquisition	4,000,000.0
When annual net sales collected reach $100.0 million
Goodwill
Milestone payments for EXPAREL agreed in connection with acquisition	8,000,000.0
Annual net sales threshold	100,000,000.0
Payment Obligation Arising Due to Net Sales Collected Threshold of $100 Million	8,000,000
Net Sales Collected Threshold Which Triggers a Payment Obligation	100,000,000
When annual net sales collected reach $250.0 million
Goodwill
Milestone payments for EXPAREL agreed in connection with acquisition	8,000,000.0
Annual net sales threshold	250,000,000.0
Net Sales Collected Threshold Which Triggers a Payment Obligation	250,000,000
Contingent liability for milestone achievement	8,000,000
When annual net sales collected reach $500.0 million
Goodwill
Milestone payments for EXPAREL agreed in connection with acquisition	32,000,000.0
Annual net sales threshold	$ 500,000,000.0

GOODWILL AND INTANGIBLE ASSETS (Details 2) $ in Thousands	6 Months Ended
GOODWILL AND INTANGIBLE ASSETS (Details 2) $ in Thousands	Jun. 30, 2018 USD ($)
Goodwill [Roll Forward]
Balance at December 31, 2017	$ 55,197
Percentage payments on collections of net sales of DepoBupivacaine products	4,715
Balance at June 30, 2018	$ 59,912

DEBT (Details) - USD ($)	Mar. 13, 2017	Jun. 30, 2018	Dec. 31, 2017
Convertible Senior Notes Due 2022
Debt Instrument [Line Items]
Debt Instrument, Principal Amount Denominator for Conversion into Common Stock		$ 1,000
Unsecured Debt \| Convertible Senior Notes Due 2022
Debt Instrument [Line Items]
Convertible senior notes, gross		345,000,000	$ 345,000,000
Deferred financing costs		(6,675,000)	(7,482,000)
Discount on debt		(55,067,000)	(61,345,000)
Total debt, net of debt discount and deferred financing costs		283,258,000	276,173,000
Unsecured Debt \| Convertible Senior Notes Due 2019
Debt Instrument [Line Items]
Convertible senior notes, gross		338,000	338,000
Deferred financing costs		(1,000)	(2,000)
Discount on debt		(7,000)	(12,000)
Total debt, net of debt discount and deferred financing costs		330,000	$ 324,000
Debt Conversion Terms Business Day Immediately Preceding October 1, 2021 [Member] \| Convertible Senior Notes Due 2022
Debt Instrument [Line Items]
Debt Instrument, Conversion Obligation Common Stock Closing Sales Price Minimum as Percentage of Conversion Price	130.00%
Debt Instrument, Principal Amount Denominator for Conversion into Common Stock		$ 1,000
Debt Instrument, Conversion Obligation Common Stock Closing Sales Price Minimum, Number of Trading Days	20 days
Debt Instrument, Conversion Obligation Number of Consecutive Trading Days	30 days

DEBT (Details 2) - USD ($) $ / shares in Units, shares in Thousands			1 Months Ended		3 Months Ended		6 Months Ended
	Mar. 13, 2017	Jan. 23, 2013	May 31, 2017	Mar. 31, 2017	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017	Mar. 07, 2017
DEBT AND FINANCING OBLIGATIONS
Settlement period - convertible debt conversion request							40 days
Closing sale price (in dollars per share)					$ 32.05		$ 32.05
Estimated conversion value					$ 100,000		$ 100,000
Shares issued to settle the conversion premium			10	2,500
Loss on early extinguishment of debt				$ 3,700,000	0	$ 11,000	0	$ 3,732,000
Repayments of debt							0	$ 118,191,000
Convertible Senior Notes Due 2022
DEBT AND FINANCING OBLIGATIONS
Principal amount used for debt instrument conversion ratio					1,000		1,000
Initial conversion rate of common stock per $1000 of principal amount of Notes (in shares)	14.9491
Initial conversion price of notes into common stock (in dollars per share)	$ 66.89	$ 66.89
Convertible debt, premium on common stock	37.50%
Closing sale price (in dollars per share)										$ 48.65
Liability component of convertible debt	$ 274,100,000
Convertible debt, assumed borrowing rate	7.45%
Convertible debt, carrying amount of equity component	$ 70,900,000
Total transaction costs related to the issuance of Notes	$ 11,000,000
Debt issuance costs, amortization period	5 years
Convertible Senior Notes Due 2022 \| Conversion terms prior to close of business on business day immediately proceeding October 1, 2021
DEBT AND FINANCING OBLIGATIONS
Convertible debt, common stock closing sales price minimum, number of trading days	20 days
Convertible debt, number of consecutive trading days	30 days
Convertible debt, common stock closing sales price minimum as percentage of conversion price	130.00%
Principal amount used for debt instrument conversion ratio					1,000		1,000
Market price per $1000 of principal amount of notes					934		934
Convertible Senior Notes Due 2022 \| Debt Redemption Terms on or after April 1, 2020
DEBT AND FINANCING OBLIGATIONS
Convertible debt, common stock closing sales price minimum, number of trading days	20 days
Convertible debt, number of consecutive trading days	30 days
Convertible debt, common stock closing sales price minimum as percentage of conversion price	130.00%
Convertible debt, number of trading days prior to date on which entity provides notice of redemption	5 days
Debt Instrument, Percentage of Principal Amount for Computation of Redemption Price	100.00%
Convertible Senior Notes Due 2019
DEBT AND FINANCING OBLIGATIONS
Initial conversion price of notes into common stock (in dollars per share)		$ 24.82
Debt repurchased face amount				117,700,000	500,000		500,000
Debt repurchase amount				$ 118,200,000	500,000		500,000
Repayments of debt							300,000
Convertible Senior Notes Due 2019 \| Conversion terms, prior to close of business on business day immediately preceding August 1, 2018
DEBT AND FINANCING OBLIGATIONS
Principal amount used for debt instrument conversion ratio					1,000		1,000
Market price per $1000 of principal amount of notes					1,320		1,320
Estimated conversion value					1,291		1,291
Unsecured Debt \| Convertible Senior Notes Due 2022
DEBT AND FINANCING OBLIGATIONS
Debt issued in private placement	$ 345,000,000
Stated interest rate (as a percent)	2.375%
Net proceeds from issuance of convertible debt	$ 334,000,000
Convertible notes outstanding amount					$ 283,258,000		$ 283,258,000		$ 276,173,000
Unsecured Debt \| Convertible Senior Notes Due 2019
DEBT AND FINANCING OBLIGATIONS
Debt issued in private placement		$ 120,000,000
Stated interest rate (as a percent)		3.25%			3.25%		3.25%
Convertible notes outstanding amount					$ 330,000		$ 330,000		$ 324,000

DEBT (Details 3) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
DEBT (Details 3) - USD ($) $ in Thousands	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Amortization of debt discount			$ 6,283	$ 4,362
Capitalized interest and other (Note 5)	$ (200)	$ (200)	$ (600)	$ (400)
Effective interest rate on convertible senior notes	7.81%	7.81%	7.81%	7.70%
Convertible Senior Notes Due 2019
Contractual interest expense	$ 2,051	$ 2,053	$ 4,102	$ 3,242
Amortization of debt issuance costs	406	389	808	590
Amortization of debt discount	3,170	2,951	6,283	4,362
Capitalized interest and other (Note 5)	(230)	(167)	(640)	(379)
Total	$ 5,397	$ 5,226	$ 10,553	$ 7,815

FINANCIAL INSTRUMENTS (Details) - USD ($) $ / shares in Units, $ in Thousands, shares in Millions		3 Months Ended
	Jan. 23, 2013	Jun. 30, 2018	Mar. 13, 2017	Mar. 07, 2017
Fair Value Measurements
Closing sale price (in dollars per share)		$ 32.05
Debt Instrument, Convertible, Conversion Premium, Shares		0.0
Estimated conversion value		$ 100
Convertible Senior Notes Due 2022
Fair Value Measurements
Closing sale price (in dollars per share)				$ 48.65
Initial conversion price of notes into common stock (in dollars per share)	$ 66.89		$ 66.89
Convertible Senior Notes Due 2022 \| Level 1
Fair Value Measurements
Convertible senior notes		0
Convertible Senior Notes Due 2022 \| Level 2
Fair Value Measurements
Convertible senior notes		322,351
Convertible Senior Notes Due 2022 \| Level 3
Fair Value Measurements
Convertible senior notes		0
Convertible Senior Notes Due 2022 \| Carrying Value
Fair Value Measurements
Convertible senior notes		283,258
Convertible Senior Notes Due 2019
Fair Value Measurements
Initial conversion price of notes into common stock (in dollars per share)	$ 24.82
Convertible Senior Notes Due 2019 \| Level 1
Fair Value Measurements
Convertible senior notes		0
Convertible Senior Notes Due 2019 \| Level 2
Fair Value Measurements
Convertible senior notes		446
Convertible Senior Notes Due 2019 \| Level 3
Fair Value Measurements
Convertible senior notes		0
Convertible Senior Notes Due 2019 \| Carrying Value
Fair Value Measurements
Convertible senior notes		$ 330
Maximum [Member] \| Convertible Senior Notes Due 2022
Fair Value Measurements
Debt Instrument, Convertible, Conversion Premium, Shares	5.2
Maximum [Member] \| Convertible Senior Notes Due 2019
Fair Value Measurements
Debt Instrument, Convertible, Conversion Premium, Shares	0.0

FINANCIAL INSTRUMENTS (Details 2) - USD ($) $ in Thousands	1 Months Ended
FINANCIAL INSTRUMENTS (Details 2) - USD ($) $ in Thousands	Oct. 31, 2017	Jun. 30, 2018	Dec. 31, 2017	Sep. 30, 2017
Fair Value Measurements
Payments to Acquire Businesses, Net of Cash Acquired	$ 15,000
Business Combination, Contingent Consideration Arrangements, Range of Outcomes, Value, High				$ 10,000
Summary of Investments, Other than Investments in Related Parties, Carrying Amount		$ 14,146	$ 14,146
Investments, Contingent Purchase Obligation			900
Level 2
Fair Value Measurements
Cost		256,596	317,722
Gross Unrealized Gains		8	0
Gross Unrealized Losses		(553)	(454)
Fair Value		256,051	317,268
Short-term Investments \| Level 2
Fair Value Measurements
Cost		254,994	257,456
Gross Unrealized Gains		8	0
Gross Unrealized Losses		(552)	(235)
Fair Value		254,450	257,221
Short-term Investments \| Asset-backed securities \| Level 2
Fair Value Measurements
Cost		47,341	28,338
Gross Unrealized Gains		0	0
Gross Unrealized Losses		(152)	(37)
Fair Value		47,189	28,301
Short-term Investments \| Commercial paper \| Level 2
Fair Value Measurements
Cost		72,447	48,999
Gross Unrealized Gains		8	0
Gross Unrealized Losses		(3)	(23)
Fair Value		72,452	48,976
Short-term Investments \| Corporate bonds \| Level 2
Fair Value Measurements
Cost		135,206	180,119
Gross Unrealized Gains		0	0
Gross Unrealized Losses		(397)	(175)
Fair Value		134,809	179,944
Long-Term Investments \| Level 2
Fair Value Measurements
Cost		1,602	60,266
Gross Unrealized Gains		0	0
Gross Unrealized Losses		(1)	(219)
Fair Value		1,601	60,047
Long-Term Investments \| Asset-backed securities \| Level 2
Fair Value Measurements
Cost			23,836
Gross Unrealized Gains			0
Gross Unrealized Losses			(79)
Fair Value			23,757
Long-Term Investments \| Corporate bonds \| Level 2
Fair Value Measurements
Cost		1,602	36,430
Gross Unrealized Gains		0	0
Gross Unrealized Losses		(1)	(140)
Fair Value		$ 1,601	$ 36,290

FINANCIAL INSTRUMENTS (Details 3)	6 Months Ended	12 Months Ended
FINANCIAL INSTRUMENTS (Details 3)	Jun. 30, 2018 USD ($) customer	Dec. 31, 2016 customer	Dec. 31, 2017 USD ($)
Credit Risk
Number of major customers \| customer	3	3
Amount of allowance for doubtful accounts \| $	$ 0		$ 0
Accounts receivable \| Credit risk \| Major customer one
Credit Risk
Concentration risk (as a percent)	31.00%	35.00%
Accounts receivable \| Credit risk \| Major customer two
Credit Risk
Concentration risk (as a percent)	28.00%	30.00%
Accounts receivable \| Credit risk \| Major customer three
Credit Risk
Concentration risk (as a percent)	24.00%	27.00%

STOCK PLANS (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
STOCK PLANS (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Share-Based Compensation
Stock-based compensation expense	$ 7,047	$ 7,345	$ 15,432	$ 14,744
Compensation expense from stock options, employees	4,827	5,741	11,182	11,658
Compensation expense from stock options, non-employee awards	202	29	241	83
Restricted Stock or Unit Expense	1,819	1,389	3,609	2,611
Compensation expense from employee stock purchase plan	199	186	400	392
Stock-based compensation	7,047	7,345	$ 15,432	14,744
Purchase price of common stock, ESPP (as a percent)			85.00%
Shares issued under employee stock purchase plan (shares)			34,985
Cost of goods sold
Share-Based Compensation
Stock-based compensation expense	1,046	1,395	$ 2,252	2,770
Research and development
Share-Based Compensation
Stock-based compensation expense	951	647	1,648	1,304
Selling, general and administrative
Share-Based Compensation
Stock-based compensation expense	$ 5,050	$ 5,303	$ 11,532	$ 10,670

STOCK PLANS (Details 2)	6 Months Ended
STOCK PLANS (Details 2)	Jun. 30, 2018 $ / shares shares
Weighted Average Exercise Price
Weighted average fair value (in dollars per share)	$ 18.85
Employee Stock Option
Number of Options
Outstanding beginning of period (in shares) \| shares	4,951,493
Granted (in shares) \| shares	1,683,007
Exercised (in shares) \| shares	(103,263)
Forfeited (in shares) \| shares	(242,188)
Expired (in shares) \| shares	(253,483)
Outstanding end of period (in shares) \| shares	6,035,566
Weighted Average Exercise Price
Outstanding beginning of period (in dollars per share)	$ 43.51
Granted (in dollars per share)	38.33
Exercised (in dollars per share)	14.45
Forfeited (in dollars per share)	44.43
Expired (in dollars per share)	64.19
Outstanding at end of period (in dollars per share)	$ 41.65

STOCK PLANS (Details 3)	6 Months Ended
STOCK PLANS (Details 3)	Jun. 30, 2018 $ / shares shares
Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Unvested at beginning of period (shares) \| shares	499,546
Granted (shares) \| shares	327,779
Vested (shares) \| shares	(147,844)
Forfeited (shares) \| shares	(42,722)
Unvested at end of period (shares) \| shares	636,759
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract]
Unvested at beginning of period (usd per share) \| $ / shares	$ 47.32
Granted (usd per share) \| $ / shares	38.33
Vested (usd per share) \| $ / shares	49.70
Forfeited (usd per share) \| $ / shares	45.86
Unvested at end of period (usd per share) \| $ / shares	$ 42.23
Employee Stock Option
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract]
Risk free interest rate (as a percent)	2.78%
Expected volatility (as a percent)	53.20%
Expected term of options	5 years 2 months 14 days

STOCKHOLDERS' EQUITY (Details) - USD ($) $ in Thousands	6 Months Ended
STOCKHOLDERS' EQUITY (Details) - USD ($) $ in Thousands	Jun. 30, 2018	Jun. 30, 2017
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance at beginning of period	$ (454)
Balance at end of period	(545)
Accumulated Net Unrealized Investment Gain (Loss)
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance at beginning of period	(454)	$ (30)
Other comprehensive loss before reclassifications	(91)	(34)
Amounts reclassified from accumulated other comprehensive income (loss)	0	0
Balance at end of period	$ (545)	$ (64)

NET INCOME (LOSS) PER SHARE (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Numerator for basic and diluted loss per share
Net income (loss)	$ 2,564	$ (19,743)	$ (8,116)	$ (39,609)
Denominator
Weighted average common shares outstanding (in shares)	40,796	40,160	40,751	39,079
Computation of diluted securities:
Dilutive effect of stock options (in shares)	807	0	0	0
Dilutive effect of RSUs (in shares)	87	0	0	0
Dilutive effect of ESPP purchase options (in shares)	4	0	0	0
Weighted average common shares outstanding—diluted (in shares)	41,694	40,160	40,751	39,079
Net loss per share:
Basic and diluted net income (loss) per common share (in USD per share)	$ 0.06	$ (0.49)	$ (0.20)	$ (1.01)

NET INCOME (LOSS) PER SHARE (Details 2) - shares shares in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
EARNINGS PER SHARE
Total	4,290	5,512	5,610	6,320
Employee Stock Option
EARNINGS PER SHARE
Total	3,918	5,092	5,094	5,102
Restricted Stock Units (RSUs)
EARNINGS PER SHARE
Total	367	375	483	364
Conversion premium on the Notes
EARNINGS PER SHARE
Total	0	9	0	817
Employee Stock
EARNINGS PER SHARE
Total	5	36	33	37

INCOME TAXES INCOME TAXES (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Income Tax Disclosure [Abstract]
Domestic	$ 592	$ (18,950)	$ (9,221)	$ (38,269)
Foreign	2,007	(763)	1,175	(1,280)
Income (loss) before income taxes	2,599	(19,713)	(8,046)	(39,549)
Income tax expense (less than)	$ 100	$ 100	$ 100	100
Deferred tax liability				$ 26,500

COMMITMENTS AND CONTINGENCIES (Details) $ in Thousands	Jun. 30, 2018 USD ($)
Future minimum lease payments
2018 (remaining six months)	$ 3,933
2017	8,122
2018	7,604
2019	5,245
2020	5,366
2023 through 2028	19,577
Total	$ 49,847

COMMERCIAL PARTNERS AND OTHER AGREEMENTS (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
DepoCyte Discontinuation [Line Items]
Revenues	$ 84,107	$ 70,934	$ 158,714	$ 140,217
Non-recurring charge related to discontinuation	200		300	5,000
Asset retirement obligations and other estimated exit costs	$ (162)	(4,495)	(252)	$ (4,495)
DepoCyte
DepoCyte Discontinuation [Line Items]
Asset retirement obligations and other estimated exit costs		$ (4,500)	$ 252

COMMERCIAL PARTNERS AND OTHER AGREEMENTS - DepoCyte Product Discontinuance (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
DepoCyte Discontinuation [Line Items]
Discontinued Operation, Tax Effect of Gain (Loss) from Disposal of Discontinued Operation	$ 200		$ 300	$ 5,000
Charges incurred - Lease Costs			216
Charges incurred - Total	(162)	$ (4,495)	(252)	$ (4,495)
Cash Payments made - Lease Costs			(668)
Asset Retirement Obligation, Liabilities Settled			(31)
Cash payments made - Asset Retirement Obligations and Other Discontinuation Costs			36
Cash payments made - total			(699)
Other Adjustments to Income, Discontinued Operations			80
Disposal Group, Including Discontinued Operation, Other Liabilities, Current			16
Disposal of property, plant & equipment and inventory - Total			(96)
Ending Balance - Lease Costs	902		902		$ 1,274
Asset Retirement Obligation, Current	257		257		236
Ending Balance - Total	$ 1,159		1,159		$ 1,510
DepoCyte
DepoCyte Discontinuation [Line Items]
Inventory Write-down		500
Charges incurred - Total		$ (4,500)	$ 252

COMMERCIAL PARTNERS AND OTHER AGREEMENTS - Costs and Reserves (Details) - Nuance Biotech Co. Ltd. [Member] [Member] - USD ($) $ in Millions	Jul. 20, 2018	Jun. 19, 2018
Maximum [Member] \| Achievement of Development and Commercial Milestones [Member]
Collaborative Arrangement, Milestone Payments to be Received		$ 60.0
Subsequent Event [Member]
Collaborative Arrangement, Upfront Payment Received	$ 3.0