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Cover Page - shares	3 Months Ended
Cover Page - shares	Mar. 31, 2020	May 03, 2020
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2020
Document Transition Report	false
Entity File Number	001-35060
Entity Registrant Name	PACIRA BIOSCIENCES, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	51-0619477
Entity Address, Address Line One	5 Sylvan Way, Suite 300
Entity Address, City or Town	Parsippany
Entity Address, State or Province	NJ
Entity Address, Postal Zip Code	07054
City Area Code	973
Local Phone Number	254-3560
Title of 12(b) Security	Common Stock, par value $0.001 per share
Trading Symbol	PCRX
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		42,120,749
Entity Central Index Key	0001396814
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q1
Amendment Flag	false

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Current assets:
Cash and cash equivalents	$ 54,589	$ 78,228
Short-term investments	263,875	213,722
Accounts receivable, net	38,988	47,530
Inventories, net	59,666	58,296
Prepaid expenses and other current assets	14,476	10,781
Total current assets	431,594	408,557
Long-term investments	35,120	64,798
Fixed assets, net	108,105	104,681
Right-of-use assets, net	37,613	38,124
Goodwill	99,547	99,547
Intangible Assets, Net (Excluding Goodwill)	102,421	104,387
Equity investment and other assets	6,979	10,971
Total assets	821,379	831,065
Current liabilities:
Accounts payable	15,850	12,799
Accrued expenses	44,717	70,427
Lease liabilities	3,968	4,935
Contingent consideration	14,041	18,179
Income taxes payable	1,737	1,333
Total current liabilities	80,313	107,673
Convertible senior notes	310,078	306,045
Lease liabilities	40,189	40,938
Contingent consideration	15,227	19,963
Other liabilities	1,535	1,502
Total liabilities	447,342	476,121
Commitments and contingencies (Note 16)
Stockholders’ equity:
Preferred stock, par value $0.001; 5,000,000 shares authorized; none issued and outstanding at March 31, 2020 and December 31, 2019	0	0
Common stock, par value $0.001; 250,000,000 shares authorized; 42,116,545 shares issued and outstanding at March 31, 2020; 41,908,148 shares issued and outstanding at December 31, 2019	42	42
Additional paid-in capital	766,280	753,978
Accumulated deficit	(391,239)	(399,398)
Accumulated other comprehensive income (loss)	(1,046)	322
Total stockholders’ equity	374,037	354,944
Total liabilities and stockholders’ equity	$ 821,379	$ 831,065
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 outstanding	42,116,545	41,908,148

CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Mar. 31, 2020	Dec. 31, 2019
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	42,116,545	41,908,148
Common stock, shares outstanding	42,116,545	41,908,148

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Revenues:
Total revenues	$ 105,684,000	$ 91,313,000
Operating expenses:
Cost of goods sold	29,732,000	27,303,000
Research and development	15,819,000	14,384,000
Selling, general and administrative	44,780,000	47,305,000
Amortization of acquired intangible assets	1,967,000	0
Acquisition-related (gains) charges and product discontinuation, net	(3,708,000)	1,242,000
Total operating expenses	88,590,000	90,234,000
Income from operations	17,094,000	1,079,000
Other (expense) income:
Interest income	1,589,000	2,156,000
Interest expense	(6,022,000)	(5,814,000)
Other, net	(4,104,000)	61,000
Total other expense, net	(8,537,000)	(3,597,000)
Income (loss) before income taxes	8,557,000	(2,518,000)
Income tax expense	(398,000)	(253,000)
Net income (loss)	$ 8,159,000	$ (2,771,000)
Net income (loss) per share:
Basic and diluted net income (loss) per common share (in USD per share)	$ 0.19	$ (0.07)
Weighted average common shares outstanding:
Basic (in shares)	42,032	41,240
Diluted (in shares)	42,785	41,240
Product
Revenues:
Total revenues	$ 104,745,000	$ 90,906,000
Royalty
Revenues:
Total revenues	$ 939,000	$ 407,000

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Statement of Comprehensive Income [Abstract]
Net income (loss)	$ 8,159	$ (2,771)
Other comprehensive income (loss):
Net unrealized gain (loss) on investments	(1,368)	462
Total other comprehensive income (loss)	(1,368)	462
Comprehensive income (loss)	$ 6,791	$ (2,309)

- Definition

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

+ References + Details

CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock	Additional Paid-In Capital	Accumulated Deficit	Accumulated Other Comprehensive Income	Convertible Senior Notes Due 2019	Convertible Senior Notes Due 2019 Additional Paid-In Capital
Balances (in shares) at Dec. 31, 2018		41,223
Balance at beginning of period at Dec. 31, 2018	$ 321,226	$ 41	$ 709,691	$ (388,226)	$ (280)
Increase (Decrease) in Stockholders' Equity
Exercise of stock options (in shares)		62
Exercise of stock options	1,557		1,557
Vested restricted stock units (in shares)		4
Stock-based compensation	7,434		7,434
Retirement of equity component of 2019 convertible senior notes						$ (233)	$ (233)
Net unrealized gain (loss) on investments	462				462
Net Income (Loss) Attributable to Parent	(2,771)			(2,771)
Balances (in shares) at Mar. 31, 2019		41,289
Balance at end of period at Mar. 31, 2019	327,519	$ 41	718,449	(391,153)	182
Increase (Decrease) in Stockholders' Equity
Cumulative effect adjustment of the adoption of Accounting Standards Updates \| Accounting Standards Update 2016-02	(156)			(156)
Balances (in shares) at Dec. 31, 2019		41,908
Balance at beginning of period at Dec. 31, 2019	354,944	$ 42	753,978	(399,398)	322
Increase (Decrease) in Stockholders' Equity
Exercise of stock options (in shares)		208
Exercise of stock options	3,455		3,455
Vested restricted stock units (in shares)		1
Stock-based compensation	8,847		8,847
Net unrealized gain (loss) on investments	(1,368)				(1,368)
Net Income (Loss) Attributable to Parent	8,159			8,159
Balances (in shares) at Mar. 31, 2020		42,117
Balance at end of period at Mar. 31, 2020	$ 374,037	$ 42	$ 766,280	$ (391,239)	$ (1,046)

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Operating activities:
Net income (loss)	$ 8,159	$ (2,771)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation of fixed assets and amortization of intangible assets	4,821	3,600
Amortization of debt issuance costs	439	420
Amortization of debt discount	3,594	3,345
Loss on disposal and impairment of fixed assets	22	0
Stock-based compensation	8,847	7,434
Changes in contingent consideration	(3,874)	0
Loss on investment	3,971	0
Changes in operating assets and liabilities:
Accounts receivable, net	8,542	(1,766)
Inventories, net	(1,370)	1,540
Prepaid expenses and other assets	(3,674)	(1,644)
Accounts payable	2,868	(1,442)
Accrued expenses and income taxes payable	(24,700)	(5,166)
Other liabilities	(1,173)	(51)
Payment of contingent consideration to MyoScience, Inc. securityholders	(264)	0
Net cash provided by operating activities	6,208	3,499
Investing activities:
Purchases of fixed assets	(6,724)	(2,018)
Purchases of investments	(72,610)	(22,688)
Sales of investments	50,768	103,187
Net cash (used in) provided by investing activities	(28,566)	78,481
Financing activities:
Proceeds from exercises of stock options	3,455	1,101
Repayment of 2019 convertible senior notes	0	(338)
Conversion premium on 2019 convertible senior notes	0	(233)
Payment of contingent consideration to MyoScience, Inc securityholders	(4,736)	0
Net cash (used in) provided by financing activities	(1,281)	530
Net (decrease) increase in cash and cash equivalents	(23,639)	82,510
Cash and cash equivalents, beginning of period	78,228	132,526
Cash and cash equivalents, end of period	54,589	215,036
Supplemental cash flow information:
Cash paid for interest	0	5
Non-cash investing and financing activities:
Net decrease in accrued fixed assets	$ (423)	$ (37)

DESCRIPTION OF BUSINESS	3 Months Ended
DESCRIPTION OF BUSINESS	Mar. 31, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]
DESCRIPTION OF BUSINESS	DESCRIPTION OF BUSINESS Pacira BioSciences, Inc. and its subsidiaries (collectively, the “Company” or “Pacira”) is a leading provider of non-opioid pain management and regenerative health solutions to advance and improve outcomes for health care practitioners and their patients. The Company’s long-acting, local analgesic, EXPAREL^® (bupivacaine liposome injectable suspension), was commercially launched in the United States in April 2012. EXPAREL utilizes DepoFoam^®, a unique and proprietary delivery technology that encapsulates drugs without altering their molecular structure, and releases them over a desired period of time. In April 2019, the Company added iovera°^® to its commercial offering with its acquisition of MyoScience, Inc., or MyoScience. The iovera° system is a handheld cryoanalgesia device used to deliver a precise, controlled application of cold temperature to only targeted nerves. Pacira is subject to risks common to companies in similar industries and stages, including, but not limited to, competition from larger companies, reliance on revenue from two products, reliance on a limited number of manufacturing sites, new technological innovations, dependence on key personnel, reliance on third-party service providers and sole source suppliers, protection of proprietary technology, compliance with government regulations and risks related to cybersecurity. For information on the Company’s risks related to the ongoing worldwide novel coronavirus (COVID-19) pandemic, see Part II, Item 1A. “Risk Factors”, included in this Quarterly Report on Form 10-Q. The Company is managed and operated as a single business focused on the discovery, development, manufacture, marketing, distribution and sale of non-opioid pain management and regenerative health solutions. The Company is managed by a single management team, and consistent with its organizational structure, the Chief Executive Officer and Chairman manages and allocates resources at a consolidated level. Accordingly, the Company views its business as one reportable segment to evaluate performance, allocate resources, set operational targets,and forecast its future period financial results.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

3 Months Ended

Mar. 31, 2020

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 United States Securities and Exchange Commission (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, 2019.

The condensed consolidated financial statements at March 31, 2020, and for the three-month periods ended March 31, 2020 and 2019, 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, 2019 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, 2019. The condensed 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 these 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 Company also sells EXPAREL directly to ambulatory surgery centers and physicians. The Company sells its bupivacaine

liposome injectable suspension for veterinary use to a third-party licensee and sells iovera° directly to end users. The table below includes the percentage of revenues comprised by the Company’s three largest wholesalers in each period presented:


	Three Months Ended March 31,
	2020	2019
Largest wholesaler	32%	36%
Second largest wholesaler	31%	29%
Third largest wholesaler	26%	26%
Total	89%	91%

Recently Adopted Accounting Pronouncements

In February 2016, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update, or ASU, 2016-02, Leases (Topic 842), which was adopted by the Company on January 1, 2019 using the effective date method. At adoption, the Company recorded $36.5 million of lease liabilities and $27.6 million of right-of-use, or ROU, assets as of January 1, 2019, the difference representing previously recorded lease-related assets and liabilities. There was a cumulative-effect adjustment to retained earnings of $0.2 million upon adoption.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, 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. The Company now includes forward-looking information to better form its credit loss estimates. This update also required 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 standard became effective for the Company beginning January 1, 2020. There were no credit losses recognized upon adoption at January 1, 2020.

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework. The update added the following disclosures: (i) changes in unrealized gains and losses for the period included in other comprehensive income (loss) for recurring Level 3 fair value measurements held at the end of the reporting period and (ii) the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. The standard became effective for the Company beginning January 1, 2020 and the Company has applied these new disclosure requirements in its condensed consolidated financial statements as of and for the three months ended March 31, 2020.

In August 2018, the FASB issued ASU 2018-15, Intangibles—Goodwill and Other Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract, which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The update provides guidance to determine which implementation costs to capitalize as they relate to the service contract and which costs to expense. Any expense related to the capitalized implementation costs should be recorded in the same financial statement line item in the consolidated statements of operations as the fees associated with the hosting element of the arrangement, and the payments for capitalized implementation costs should be classified in the same manner as payments made for fees associated with the hosting element in the consolidated statements of cash flows. This standard became effective for the Company beginning January 1, 2020. The amendments are to be applied prospectively to all implementation costs incurred after the date of adoption. The Company did not incur any implementation costs in a hosting arrangement during the three months ended March 31, 2020.

Recent Accounting Pronouncements Not Adopted as of March 31, 2020

In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740), Simplifying the Accounting for Income Taxes, which amends the approaches and methodologies in accounting for income taxes during interim periods and makes changes to certain income tax classifications. The new standard allows certain exceptions, including an exception to the use of the incremental approach for intra-period tax allocation, when there is a loss from continuing operations and income or a gain from other items, and to the general methodology for calculating income taxes in an interim period, when a year-to-date loss exceeds the anticipated loss for the year. The standard also requires franchise or similar taxes partially based on income to be reported as income tax and to reflect the effects of enacted changes in tax laws or rates in the annual effective tax rate computation from the date of enactment. Lastly, in any future acquisition, the Company would be required to evaluate when the

step-up in the tax basis of goodwill is part of the business combination and when it should be considered a separate transaction. The standard will be effective for the Company beginning January 1, 2021, with early adoption of the amendments permitted. The Company is evaluating the impact from the adoption of ASU 2019-12 on its consolidated financial statements.

REVENUE

3 Months Ended

Mar. 31, 2020

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 iovera° in the U.S.; (iii) sales of, and royalties on, its bupivacaine liposome injectable suspension for veterinary use in the U.S. and (iv) license fees and milestone payments. The Company does not consider revenue from sources other than sales of EXPAREL 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, and accordingly, 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 Accounting Standards Codification (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 is 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 March 31,
	2020		2019
Net product sales:
EXPAREL / bupivacaine liposome injectable suspension	$	102,475	$	90,906
iovera°	2,270		—
Total net product sales	$	104,745	$	90,906

MYOSCIENCE ACQUISITION

3 Months Ended

Mar. 31, 2020

Business Combinations [Abstract]

MYOSCIENCE ACQUISITION

On April 9, 2019, the Company acquired MyoScience (the “MyoScience Acquisition”), a privately-held medical device company, pursuant to the terms of an Agreement and Plan of Merger, under which MyoScience became a wholly-owned subsidiary of the Company and was renamed Pacira CryoTech, Inc. The total consideration was $147.5 million, which included a net cash payment of $119.0 million and the fair value of contingent consideration in the amount of $28.5 million. The contingent consideration consisted of contingent milestone payments up to an aggregate of $100.0 million upon the achievement of certain regulatory and commercial milestones, of which $68.0 million are available as of March 31, 2020. The Company’s obligation to make milestone payments is limited to those milestones achieved through December 31, 2023, and are to be paid within 60 days of the end of the fiscal quarter of achievement. During the three months ended March 31, 2020, the Company made a $5.0 million cash payment for the achievement of a regulatory milestone. The Company will pay an additional $10.0 million for the achievement of a regulatory milestone in the second quarter of 2020. Up to $5.0 million of this milestone payment may be payable in shares of the Company’s common stock, at the election of former MyoScience shareholders. See Note 10, Financial Instruments, for information on the measurement and amounts recognized on the Company’s condensed consolidated balance sheet for contingent consideration.

Unaudited Pro Forma Summary of Operations

The following table shows the unaudited pro forma summary of operations for the three months ended March 31, 2019 as if the MyoScience Acquisition had occurred on January 1, 2019. This pro forma information does not purport to represent what the Company’s actual results would have been and is not indicative of what such results would be expected for any future period (in thousands, except per share amounts):


	Three Months Ended March 31, 2019
Total revenues	$	93,453
Net loss	$	(8,102)
Pro forma basic and diluted net loss per share	$	(0.20)

The unaudited pro forma financial information was prepared using the acquisition method of accounting and was based on the historical financial information of the Company and MyoScience. The summary pro forma financial information primarily reflects the following pro forma adjustments:

•Removal of the acquisition-related transaction fees and costs from the three months ended March 31, 2019;

•Removal of MyoScience’s interest expense;

•Adjustments to the Company’s interest income for the cash used to acquire MyoScience; and

•The addition of amortization expense on the acquired developed technology and customer relationship intangible assets.

INVENTORIES

3 Months Ended

Mar. 31, 2020

Inventory Disclosure [Abstract]

INVENTORIES

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


	March 31,		December 31,
	2020		2019
Raw materials	$	23,162	$	20,019
Work-in-process	7,757		14,407
Finished goods	28,747		23,870
Total	$	59,666	$	58,296

In December 2019, the Company’s contract manufacturer experienced a media fill failure, which is part of the routine aseptic manufacturing requalification program, and an investigation was completed in April 2020. Based on the results of the investigation, the Company does not believe that any additional inventory reserves are required related to the media fill failure, and that all inventory in question has been determined to be sellable. The Company will resume production on this manufacturing line in May 2020.

FIXED ASSETS

3 Months Ended

Mar. 31, 2020

Property, Plant and Equipment [Abstract]

FIXED ASSETS

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


	March 31,		December 31,
	2020		2019
Machinery and equipment	$	70,061	$	70,078
Leasehold improvements	60,441		60,441
Computer equipment and software	9,003		8,942
Office furniture and equipment	1,882		1,882
Construction in progress	44,912		38,778
Total	186,299		180,121
Less: accumulated depreciation	(78,194)		(75,440)
Fixed assets, net	$	108,105	$	104,681

For the three months ended March 31, 2020 and 2019, depreciation expense was $2.9 million and $3.6 million, respectively. For the three months ended March 31, 2020 and 2019, there was less than $0.1 million and no capitalized interest on the construction of manufacturing sites, respectively.

At March 31, 2020 and December 31, 2019, total fixed assets, net, includes leasehold improvements and manufacturing process equipment located in Europe in the amount of $64.0 million and $64.8 million, respectively.

LEASES

3 Months Ended

Mar. 31, 2020

Leases [Abstract]

LEASES

LEASESThe Company leases all of its facilities, including its EXPAREL manufacturing facility in San Diego, California and its iovera° manufacturing facility in Fremont, California. These leases have remaining terms between five months and 10.4 years, some of which provide renewal options at the then-current market value. The Company also has a lease with Thermo Fisher Scientific Pharma Services, or Thermo Fisher (formerly Patheon UK Limited), for the use of their manufacturing facility in Swindon, England, which is embedded in agreements the Company has with Thermo Fisher. A portion of the associated monthly base fees has been allocated to the lease component based on a relative fair value basis.

The operating lease costs for the facilities include lease and non-lease components, such as common area maintenance and other common operating expenses, along with executory costs such as insurance and real estate taxes. Total operating lease costs are as follows (in thousands):


	Three Months Ended
	March 31,
Operating Lease Costs	2020		2019
Fixed lease costs	$	1,564	$	1,443
Variable lease costs	448		381
Total	$	2,012	$	1,824

Supplemental cash flow information related to operating leases is as follows (in thousands):


	Three Months Ended
	March 31,
	2020		2019
Cash paid for operating lease liabilities	$	2,759	$	2,050
Right-of-use assets recorded in exchange for lease obligations	$	174	$	34,780

The Company has elected to net the amortization of the ROU asset and the reduction of the lease liability principal in accrued expenses in the condensed consolidated statement of cash flows.

The Company has measured its operating lease liabilities at an estimated discount rate in which it could borrow on a collateralized basis over the remaining term for each operating lease. The weighted average remaining lease term and the weighted average discount rate are summarized as follows:


						March 31, 2020
Weighted average remaining lease term						9.23 years
Weighted average discount rate						7.55%

Maturities of the Company’s operating lease liabilities are as follows (in thousands):


Year	Aggregate Minimum Payments Due
2020 (remaining nine months)	$	6,116
2021	6,330
2022	5,875
2023	6,013
2024	6,155
2025 through 2030	32,830
Total lease payments	63,319

Less: imputed interest	(19,162)
Total operating lease liabilities	$	44,157

The Company has entered into one lease agreement (not included in the table above) for which there are future obligations but the lease has not yet commenced as of March 31, 2020 (in thousands):


Year	Aggregate Minimum Payments Due
2020 (remaining nine months)	$	7,124
2021	4,415
2022	4,548
2023	4,684
2024	4,825
2025 through 2030	29,242
Total future lease payments	$	54,838

GOODWILL AND INTANGIBLE ASSETS

3 Months Ended

Mar. 31, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

GOODWILL AND INTANGIBLE ASSETS

Goodwill

There was no change in the carrying value of the Company’s goodwill during the three months ended March 31, 2020. The balance at both December 31, 2019 and March 31, 2020 was $99.5 million.

Skyepharma Acquisition

In March 2007, the Company acquired from SkyePharma Holding, Inc. (now a subsidiary of Vectura Group plc), or Skyepharma, its California operating subsidiary named Pacira Pharmaceuticals, Inc. (the “Skyepharma Acquisition”). The Skyepharma Acquisition was accounted for under Statement of Financial Accounting Standards 141, Accounting for Business Combinations, which was the effective GAAP standard at the Skyepharma Acquisition date.

In connection with the Skyepharma Acquisition, the Company agreed to percentage and milestone payments for DepoBupivacaine products, including EXPAREL. The milestone payments are 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 the United Kingdom, France, Germany, Italy or 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.

As of March 31, 2020 the Company has recorded $62.0 million of goodwill related to the Skyepharma Acquisition The two unmet milestone payments totaling $36.0 million are the only remaining obligations to Skyepharma. Any remaining milestone payments will be treated as additional costs of the Skyepharma Acquisition and, therefore, recorded as goodwill if and when each contingency is resolved. For purposes of meeting future potential milestone payments, annual net sales are measured on a rolling quarterly basis.

MyoScience Acquisition

In connection with the MyoScience Acquisition, the Company recorded goodwill totaling $37.5 million. The Company subsequently made a tax election that allows the acquired goodwill and intangible assets to be tax deductible.

Intangible Assets

MyoScience Acquisition

Intangible assets, net, consist of the developed technology and customer relationships that were acquired in the MyoScience Acquisition and are summarized as follows (in thousands):


March 31, 2020	Gross Carrying Value		Accumulated Amortization		Intangible Assets, Net		Estimated Useful Life
Developed technology	$	110,000	$	(7,660)	$	102,340	14 years
Customer relationships	90		(9)		81		10 years
Total intangible assets	$	110,090	$	(7,669)	$	102,421


December 31, 2019	Gross Carrying Value		Accumulated Amortization		Intangible Assets, Net		Estimated Useful Life
Developed technology	$	110,000	$	(5,696)	$	104,304	14 years
Customer relationships	90		(7)		83		10 years
Total intangible assets	$	110,090	$	(5,703)	$	104,387

Amortization expense on intangible assets for the three months ended March 31, 2020 was $2.0 million. There was no amortization expense on intangible assets for the three months ended March 31, 2019.

Assuming no changes in the gross carrying amount of these intangible assets, amortization expense on intangible assets will be $5.9 million for the remaining nine months of 2020 and the future amortization expense on intangible assets will be $7.9 million annually through 2032 and $2.2 million in 2033.

DEBT

3 Months Ended

Mar. 31, 2020

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^st and October 1^st of each year. The 2022 Notes mature on April 1, 2022.

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


	March 31,		December 31,
	2020		2019
2.375% convertible senior notes due 2022	$	345,000	$	345,000
Deferred financing costs	(3,704)		(4,143)
Discount on debt	(31,218)		(34,812)
Total debt, net of debt discount and deferred financing costs	$	310,078	$	306,045

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 March 31, 2020, 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 March 31, 2020, the 2022 Notes had a market price of $960 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 settled, 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).

As of 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 March 31, 2020 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.

Interest Expense

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


	Three Months Ended March 31,
	2020			2019
Contractual interest expense	$	2,049		$	2,049
Amortization of debt issuance costs	439			420
Amortization of debt discount	3,594			3,345
Capitalized interest and other (Note 6)	(60)			—
Total	$	6,022		$	5,814

Effective interest rate on convertible senior notes	7.81		%	7.81		%

FINANCIAL INSTRUMENTS

3 Months Ended

Mar. 31, 2020

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 equity investment is calculated utilizing market quotations from a major American stock exchange (Level 1). The fair value of the Company’s convertible senior notes are calculated utilizing market quotations from an over-the-counter trading market for these notes (Level 2). The fair value of the Company’s acquisition-related contingent consideration is reported at fair value on a recurring basis (Level 3). The carrying values and fair values of the Company’s financial assets and liabilities at March 31, 2020 are as follows (in thousands):


	Carrying Value		Fair Value Measurements Using
					Level 1			Level 2			Level 3
Financial Assets:
Equity investment ⁽³⁾	$	6,053	$	6,053		$	—		$	—
Financial Liabilities:
2.375% convertible senior notes due 2022 ⁽¹⁾⁽²⁾	$	310,078	$	—		$	331,200		$	—
Acquisition-related contingent consideration ⁽³⁾	$	29,268	$	—		$	—		$	29,268

(1) The closing price of the Company’s common stock as reported on the Nasdaq Global Select Market was $33.53 per share on March 31, 2020 compared to a conversion price of $66.89 per share. Therefore, at March 31, 2020, the conversion price was 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) Reported at historical cost.

(3) Reported at fair value on a recurring basis.

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

Financial Liabilities Measured at Fair Value on a Recurring Basis

The Company has recognized contingent consideration related to the MyoScience Acquisition in the amount of $29.3 million as of March 31, 2020. Refer to Note 4, MyoScience Acquisition and Note 15, Acquisition-Related (Gains) Charges and Product Discontinuation, Net, for more information.

The Company’s contingent consideration obligations are recorded at their estimated fair values and are revalued each reporting period if and until the related contingencies are resolved. The Company has, as a result of downward revisions in its forecasted revenues (principally due to the impact of the COVID-19 pandemic), for the three months ended March 31, 2020, recognized $3.9 million of credits related to contingent consideration, which have been included in acquisition-related (gains) charges in the condensed consolidated statements of operations. The Company has measured the fair value of its contingent consideration using a probability-weighted discounted cash flow approach that is based on unobservable inputs and a Monte Carlo simulation. These inputs include, as applicable, estimated probabilities and the timing of achieving specified commercial and regulatory milestones, estimated forecasts of revenue and costs and discount rates used to calculate the present value of estimated future payments. Significant changes may increase or decrease the probabilities of achieving the related commercial and regulatory events, shorten or lengthen the time required to achieve such events, or increase or decrease estimated forecasts. At March 31, 2020, the weighted average discount rate was 9.7% and the weighted average probability of success for regulatory milestones was 44.6%.

The following table includes the key assumptions used in the valuation of the Company’s contingent consideration:


Assumption						Ranges Utilized as of March 31, 2020
Discount rates						9.55% to 9.82%
Probabilities of payment for regulatory milestones						3% to 100%
Projected years of payment for regulatory and commercial milestones						2020 to 2023

The maximum remaining potential payments related to the contingent consideration from the MyoScience Acquisition are $68.0 million, including a $10.0 million payment to be made in the second quarter of 2020.

The change in the Company’s contingent consideration recorded at fair value using Level 3 measurements is as follows (in thousands):


	Contingent Consideration Fair Value
Balance at December 31, 2019	$	38,142

Fair value adjustments and accretion	(3,874)
Payments made	(5,000)
Balance at March 31, 2020	$	29,268

Investments

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 but less than two years. Net unrealized gains and losses (excluding credit losses, if any) from the Company’s short-term and long-term investments are reported in other comprehensive income (loss). At March 31, 2020, 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 March 31, 2020, all short-term and long-term investments had an “A” or better rating by Standard & Poor’s.

The following summarizes the Company’s investments at March 31, 2020 and December 31, 2019 (in thousands):


March 31, 2020 Investments	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value (Level 2)
Short-term:
Asset-backed securities	$	57,327	$	64	$	(130)	$	57,261
Commercial paper	28,878		26		—		28,904
Corporate bonds	178,374		54		(718)		177,710
Subtotal	264,579		144		(848)		263,875
Long-term:
Asset-backed securities	6,175		23		—		6,198
Corporate bonds	29,287		4		(369)		28,922
Subtotal	35,462		27		(369)		35,120
Total	$	300,041	$	171	$	(1,217)	$	298,995


December 31, 2019 Investments	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value (Level 2)
Short-term:
Asset-backed securities	$	43,166	$	54	$	—	$	43,220
Commercial paper	32,250		20		—		32,270
Corporate bonds	138,012		225		(5)		138,232
Subtotal	213,428		299		(5)		213,722
Long-term:
Asset-backed securities	28,064		10		(15)		28,059
Corporate bonds	36,706		37		(4)		36,739
Subtotal	64,770		47		(19)		64,798
Total	$	278,198	$	346	$	(24)	$	278,520

At March 31, 2020, the fair values of some of the investments held for sale were less than their amortized costs. These investments had been in unrealized loss positions for less than 12 months. The Company considered whether it intends to sell or is more likely than not to be required to sell those investments prior to the recovery of their amortized cost bases. In addition, the Company considered the present value of future cash flows of those investments and projects that these cash flows will be greater than the amortized costs. For the three months ended March 31, 2020, the Company concluded that the decline in fair value was not a result of credit losses and no credit impairments have been recognized in the condensed consolidated statements of operations.

The Company elects to recognize its interest receivable separate from its available for sale investments. At March 31, 2020 and December 31, 2019, the interest receivable recognized in prepaid expenses and other current assets was $1.6 million and $1.0 million, respectively.

Equity Investment

At March 31, 2020 and December 31, 2019, the Company held an equity investment in TELA Bio, Inc., or TELA Bio, in its condensed consolidated balance sheets in the amount of $6.1 million and $10.0 million, respectively. During the three months ended March 31, 2020, the Company recorded its investment in TELA Bio at fair value, based on a quoted market price, which resulted in an impairment loss in the amount of $4.0 million. There was no impairment loss in the three months ended March 31, 2019. The fair values at both March 31, 2020 and December 31, 2019 were based on Level 1 inputs.

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 March 31, 2020, three wholesalers each accounted for over 10% of the Company’s accounts receivable, at 32%, 29% and 28%, respectively. At December 31, 2019, three wholesalers each accounted for over 10% of the Company’s accounts receivable, at 37%, 29% and 26%, respectively. For additional information regarding the Company’s wholesalers, see Note 2, Summary of Significant Accounting Policies. EXPAREL revenues are primarily derived from major wholesalers and pharmaceutical companies which generally have significant cash resources. The Company performs ongoing credit evaluations of its customers as warranted and generally does not require collateral. Allowances for credit losses on the Company’s accounts receivable are maintained based on historical payment patterns, current and estimated future economic conditions, aging of accounts receivable and actual write-off history. As of March 31, 2020 and December 31, 2019, no allowances for credit losses were deemed necessary by the Company on its accounts receivable.

STOCK PLANS

3 Months Ended

Mar. 31, 2020

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 March 31,
	2020		2019
Cost of goods sold	$	1,219	$	1,091
Research and development	1,186		1,218
Selling, general and administrative	6,442		5,125
Total	$	8,847	$	7,434

Stock-based compensation from:
Stock options	$	6,225	$	5,121
Restricted stock units	2,402		2,107
Employee stock purchase plan	220		206
Total	$	8,847	$	7,434

Equity Awards

The following tables contain information about the Company’s stock option and restricted stock unit, or RSU, activity for the three months ended March 31, 2020:


Stock Options	Number of Options	Weighted Average Exercise Price (Per Share)
Outstanding at December 31, 2019	6,706,378	$	42.80
Granted	188,450	43.53
Exercised	(207,548)	16.64
Forfeited	(91,069)	41.66
Expired	(14,057)	63.34
Outstanding at March 31, 2020	6,582,154	43.62


Restricted Stock Units	Number of Units	Weighted Average Grant Date Fair Value (Per Share)
Unvested at December 31, 2019	631,141	$	41.87
Granted	350	43.27
Vested	(849)	48.16
Forfeited	(15,567)	41.89
Unvested at March 31, 2020	615,075	41.86

The weighted average fair value of stock options granted during the three months ended March 31, 2020 was $20.97 per share. The fair values of stock options granted were estimated using the Black-Scholes option valuation model with the following weighted average assumptions:


Black-Scholes Weighted Average Assumption						Three Months Ended March 31, 2020
Expected dividend yield						None
Risk-free interest rate						1.35%
Expected volatility						53.90%
Expected term of options						5.24 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 three months ended March 31, 2020, no shares were purchased and issued through the ESPP.

STOCKHOLDERS' EQUITY

3 Months Ended

Mar. 31, 2020

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):


	Three Months Ended March 31,
Net unrealized gains (losses) from available for sale investments:	2020		2019
Balance at beginning of period	$	322	$	(280)
Other comprehensive income (loss) before reclassifications	(1,368)		462
Amounts reclassified from accumulated other comprehensive income (loss)	—		—
Balance at end of period	$	(1,046)	$	182

NET INCOME (LOSS) PER SHARE

3 Months Ended

Mar. 31, 2020

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, the purchase of shares from the ESPP (using the treasury stock method) and the conversion of the excess conversion value on the 2022 Notes. As discussed in Note 9, 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.

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 March 31, 2019, no potentially dilutive securities have been included in the computation of diluted net loss per share for that period.

The following table sets forth the computation of basic and diluted net loss per share for the three months ended March 31, 2020 and 2019 (in thousands, except per share amounts):


	Three Months Ended March 31,
			2020			2019
Numerator:
Net income (loss)	$	8,159		$	(2,771)







Denominator:
Weighted average common shares outstanding—basic	42,032			41,240
Computation of diluted securities:
Dilutive effect of stock options	585			—
Dilutive effect of RSUs	168			—



Weighted average common shares outstanding—diluted	42,785			41,240
Net income (loss) per share:
Basic and diluted net income (loss) per common share	$	0.19		$	(0.07)

The following outstanding stock options, RSUs and ESPP purchase options are antidilutive in the periods presented (in thousands):


	Three Months Ended March 31,
	2020	2019
Weighted average number of stock options	5,343	5,792
Weighted average number of RSUs	2	559

Weighted average ESPP purchase options	40	37

Total	5,385	6,388

INCOME TAXES

3 Months Ended

Mar. 31, 2020

Income Tax Disclosure [Abstract]

TAXES

INCOME TAXES

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


	Three Months Ended March 31,
	2020		2019
Income (loss) before income taxes:
Domestic	$	13,046	$	1,819
Foreign	(4,489)		(4,337)
Total income (loss) before income taxes	$	8,557	$	(2,518)

For the three months ended March 31, 2020 and 2019, the Company recorded income tax expense of $0.4 million and $0.3 million, respectively. The tax provisions for 2020 and 2019 reflect current state income taxes. Due to net operating losses, or NOLs, carried forward, and the repeal of the corporate minimum tax, no current federal income tax expense was recorded for 2020 or 2019. The utilization of the Company’s NOLs has not resulted in any deferred federal tax expense because there was a full valuation allowance recorded with respect to the NOLs.

ACQUISITION–RELATED (GAINS) CHARGES AND PRODUCT DISCONTINUATION, NET

3 Months Ended

Mar. 31, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

MyoScience Acquisition

The Company recognized acquisition-related gains related to the MyoScience Acquisition in the amount of $3.7 million and acquisition-related charges of $1.2 million in the three months ended March 31, 2020 and 2019, respectively. The acquisition-related gains primarily reflect the decrease in the fair value of contingent consideration in the amount of $3.9 million for the three months ended March 31, 2020. See Note 10, Financial Instruments, for information regarding the method and key assumptions used in the fair value measurements of contingent consideration. In the three months ended March 31, 2020 and 2019, the remaining acquisition-related charges of $0.2 million and $1.2 million represented legal, accounting, and other related costs. See Note 4, MyoScience Acquisition, for more information.

DepoCyt(e) Discontinuation

The Company recorded costs related to its DepoCyt(e) discontinuation activities of less than $0.1 million in each of the three month periods ended March 31, 2020 and 2019. The Company ceased all production of DepoCyt(e) as of June 30, 2017. Cash payments for the DepoCyt(e) manufacturing facility are expected to continue through the end of its lease term in August 2020.

Summary of Acquisition-Related Restructuring Activities and DepoCyt(e) Discontinuation Costs

The Company’s acquisition-related restructuring and DepoCyt(e) discontinuation costs as of March 31, 2020 are summarized below (in thousands):


	Severance and Related Costs		Asset Retirement Obligations, Other Restructuring and Discontinuation Costs		Total
Balance at December 31, 2019	$	81	$558		$	639
Charges incurred	—		166		166
Cash payments made	—		(292)		(292)
Balance at March 31, 2020	$	81	$	432	$	513

COMMITMENTS AND CONTINGENCIES	3 Months Ended
COMMITMENTS AND CONTINGENCIES	Mar. 31, 2020
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	COMMITMENTS AND CONTINGENCIES 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. In December 2019, the Company reached an agreement in principle with the Department of Justice and more than one state Attorney General’s office (the “Plaintiffs”) on a proposal for a global civil settlement in the amount of $3.5 million, subject to accrual of interest on the settlement amount from the date of the agreement in principle, negotiation of a definitive settlement agreement and other contingencies. As part of the settlement, the Company will admit no wrongdoing and will explicitly deny the Plaintiffs’ allegations. The Company has been given assurances that, if the parties can agree to negotiation of the settlement, this will conclude the investigation that originated from the U.S. Department of Justice subpoena in April 2015. This settlement was recorded in acquisition-related charges, product discontinuation and other in the consolidated financial statements for the year ended December 31, 2019.

Subsequent Events (Notes)	3 Months Ended
Subsequent Events (Notes)	Mar. 31, 2020
Subsequent Events [Abstract]
Subsequent Events	NOTE 17—SUBSEQUENT EVENTS Novel Coronavirus (COVID-19) Pandemic The Company began experiencing the impact of the global pandemic caused by a novel strain of coronavirus (COVID-19) on its business in mid-March 2020, and has continued to experience sales disruptions into the second quarter of 2020. The principal impact of the COVID-19 pandemic on the Company’s business is that many hospitals, surgical centers and clinicians have suspended elective procedures per the recommendation of the Centers for Disease Control and Prevention (CDC), resulting in a decline in revenue for both EXPAREL and iovera°. The Company expects to continue to be impacted as long as elective surgical procedures are restricted by government action, or by patient or clinician behavior. Also, in response to the COVID-19 pandemic, many hospitals, ambulatory surgical centers and clinicians have restricted sales force access to their sites. While some states are starting to ease or lift elective surgery restrictions, the Company does not know how long other states will mandate stay at home orders or how long it will take the surgical community to return to normal operations. The Company’s manufacturing sites are operational and have implemented new safety protocols and guidelines as recommended by federal, state and local governments. To date, there have been no material impacts to the Company’s supply chain. The situation remains dynamic and subject to rapid and possibly material changes. Additional negative impacts may also arise from the COVID-19 pandemic that the Company is unable to foresee. The nature and extent of such impacts will depend on future developments, which are highly uncertain and cannot be predicted.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

3 Months Ended

Mar. 31, 2020

Accounting Policies [Abstract]

Basis of Presentation and Principles of Consolidation

The results of operations for these 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


	Three Months Ended March 31,
	2020	2019
Largest wholesaler	32%	36%
Second largest wholesaler	31%	29%
Third largest wholesaler	26%	26%
Total	89%	91%

Recent Accounting Pronouncements

Recently Adopted Accounting Pronouncements

Recent Accounting Pronouncements Not Adopted as of March 31, 2020

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

3 Months Ended

Mar. 31, 2020

Accounting Policies [Abstract]

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

three largest wholesalers in each period presented:


	Three Months Ended March 31,
	2020	2019
Largest wholesaler	32%	36%
Second largest wholesaler	31%	29%
Third largest wholesaler	26%	26%
Total	89%	91%

REVENUE (Tables)

3 Months Ended

Mar. 31, 2020

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 March 31,
	2020		2019
Net product sales:
EXPAREL / bupivacaine liposome injectable suspension	$	102,475	$	90,906
iovera°	2,270		—
Total net product sales	$	104,745	$	90,906

MYOSCIENCE ACQUISITION (Tables)

3 Months Ended

Mar. 31, 2020

Business Combinations [Abstract]

Unaudited Pro Forma Summary of Operations


	Three Months Ended March 31, 2019
Total revenues	$	93,453
Net loss	$	(8,102)
Pro forma basic and diluted net loss per share	$	(0.20)

INVENTORIES (Tables)

3 Months Ended

Mar. 31, 2020

Inventory Disclosure [Abstract]

Schedule of components of inventories

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


	March 31,		December 31,
	2020		2019
Raw materials	$	23,162	$	20,019
Work-in-process	7,757		14,407
Finished goods	28,747		23,870
Total	$	59,666	$	58,296

FIXED ASSETS (Tables)

3 Months Ended

Mar. 31, 2020

Property, Plant and Equipment [Abstract]

Schedule of fixed assets summarized by major category

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


	March 31,		December 31,
	2020		2019
Machinery and equipment	$	70,061	$	70,078
Leasehold improvements	60,441		60,441
Computer equipment and software	9,003		8,942
Office furniture and equipment	1,882		1,882
Construction in progress	44,912		38,778
Total	186,299		180,121
Less: accumulated depreciation	(78,194)		(75,440)
Fixed assets, net	$	108,105	$	104,681

LEASES (Tables)

3 Months Ended

Mar. 31, 2020

Leases [Abstract]

Summary of operating lease cost and other operating lease information


	Three Months Ended
	March 31,
Operating Lease Costs	2020		2019
Fixed lease costs	$	1,564	$	1,443
Variable lease costs	448		381
Total	$	2,012	$	1,824

Supplemental cash flow information related to operating leases is as follows (in thousands):


	Three Months Ended
	March 31,
	2020		2019
Cash paid for operating lease liabilities	$	2,759	$	2,050
Right-of-use assets recorded in exchange for lease obligations	$	174	$	34,780


						March 31, 2020
Weighted average remaining lease term						9.23 years
Weighted average discount rate						7.55%

Schedule of maturities of operating lease liabilities

Maturities of the Company’s operating lease liabilities are as follows (in thousands):


Year	Aggregate Minimum Payments Due
2020 (remaining nine months)	$	6,116
2021	6,330
2022	5,875
2023	6,013
2024	6,155
2025 through 2030	32,830
Total lease payments	63,319

Less: imputed interest	(19,162)
Total operating lease liabilities	$	44,157

Schedule of maturities of operating lease liabilities

The Company has entered into one lease agreement (not included in the table above) for which there are future obligations but the lease has not yet commenced as of March 31, 2020 (in thousands):


Year	Aggregate Minimum Payments Due
2020 (remaining nine months)	$	7,124
2021	4,415
2022	4,548
2023	4,684
2024	4,825
2025 through 2030	29,242
Total future lease payments	$	54,838

DEBT (Tables)

3 Months Ended

Mar. 31, 2020

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):


	March 31,		December 31,
	2020		2019
2.375% convertible senior notes due 2022	$	345,000	$	345,000
Deferred financing costs	(3,704)		(4,143)
Discount on debt	(31,218)		(34,812)
Total debt, net of debt discount and deferred financing costs	$	310,078	$	306,045

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 March 31,
	2020			2019
Contractual interest expense	$	2,049		$	2,049
Amortization of debt issuance costs	439			420
Amortization of debt discount	3,594			3,345
Capitalized interest and other (Note 6)	(60)			—
Total	$	6,022		$	5,814

Effective interest rate on convertible senior notes	7.81		%	7.81		%

FINANCIAL INSTRUMENTS (Tables)

3 Months Ended

Mar. 31, 2020

Fair Value Disclosures [Abstract]

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

The carrying values and fair values of the Company’s financial assets and liabilities at March 31, 2020 are as follows (in thousands):


	Carrying Value		Fair Value Measurements Using
					Level 1			Level 2			Level 3
Financial Assets:
Equity investment ⁽³⁾	$	6,053	$	6,053		$	—		$	—
Financial Liabilities:
2.375% convertible senior notes due 2022 ⁽¹⁾⁽²⁾	$	310,078	$	—		$	331,200		$	—
Acquisition-related contingent consideration ⁽³⁾	$	29,268	$	—		$	—		$	29,268

(2) Reported at historical cost.

(3) Reported at fair value on a recurring basis.

Schedule of key assumptions used in the valuation of contingent consideration

The following table includes the key assumptions used in the valuation of the Company’s contingent consideration:


Assumption						Ranges Utilized as of March 31, 2020
Discount rates						9.55% to 9.82%
Probabilities of payment for regulatory milestones						3% to 100%
Projected years of payment for regulatory and commercial milestones						2020 to 2023

Schedule of change in contingent consideration recorded at fair value using Level 3 measurements

The change in the Company’s contingent consideration recorded at fair value using Level 3 measurements is as follows (in thousands):


	Contingent Consideration Fair Value
Balance at December 31, 2019	$	38,142

Fair value adjustments and accretion	(3,874)
Payments made	(5,000)
Balance at March 31, 2020	$	29,268

Schedule of short-term investments

The following summarizes the Company’s investments at March 31, 2020 and December 31, 2019 (in thousands):


March 31, 2020 Investments	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value (Level 2)
Short-term:
Asset-backed securities	$	57,327	$	64	$	(130)	$	57,261
Commercial paper	28,878		26		—		28,904
Corporate bonds	178,374		54		(718)		177,710
Subtotal	264,579		144		(848)		263,875
Long-term:
Asset-backed securities	6,175		23		—		6,198
Corporate bonds	29,287		4		(369)		28,922
Subtotal	35,462		27		(369)		35,120
Total	$	300,041	$	171	$	(1,217)	$	298,995


December 31, 2019 Investments	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value (Level 2)
Short-term:
Asset-backed securities	$	43,166	$	54	$	—	$	43,220
Commercial paper	32,250		20		—		32,270
Corporate bonds	138,012		225		(5)		138,232
Subtotal	213,428		299		(5)		213,722
Long-term:
Asset-backed securities	28,064		10		(15)		28,059
Corporate bonds	36,706		37		(4)		36,739
Subtotal	64,770		47		(19)		64,798
Total	$	278,198	$	346	$	(24)	$	278,520

STOCK PLANS (Tables)

3 Months Ended

Mar. 31, 2020

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 March 31,
	2020		2019
Cost of goods sold	$	1,219	$	1,091
Research and development	1,186		1,218
Selling, general and administrative	6,442		5,125
Total	$	8,847	$	7,434

Stock-based compensation from:
Stock options	$	6,225	$	5,121
Restricted stock units	2,402		2,107
Employee stock purchase plan	220		206
Total	$	8,847	$	7,434

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 three months ended March 31, 2020:


Stock Options	Number of Options	Weighted Average Exercise Price (Per Share)
Outstanding at December 31, 2019	6,706,378	$	42.80
Granted	188,450	43.53
Exercised	(207,548)	16.64
Forfeited	(91,069)	41.66
Expired	(14,057)	63.34
Outstanding at March 31, 2020	6,582,154	43.62


Restricted Stock Units	Number of Units	Weighted Average Grant Date Fair Value (Per Share)
Unvested at December 31, 2019	631,141	$	41.87
Granted	350	43.27
Vested	(849)	48.16
Forfeited	(15,567)	41.89
Unvested at March 31, 2020	615,075	41.86

STOCKHOLDERS' EQUITY (Tables)

3 Months Ended

Mar. 31, 2020

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):


	Three Months Ended March 31,
Net unrealized gains (losses) from available for sale investments:	2020		2019
Balance at beginning of period	$	322	$	(280)
Other comprehensive income (loss) before reclassifications	(1,368)		462
Amounts reclassified from accumulated other comprehensive income (loss)	—		—
Balance at end of period	$	(1,046)	$	182

NET INCOME (LOSS) PER SHARE (Tables)

3 Months Ended

Mar. 31, 2020

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 loss per share for the three months ended March 31, 2020 and 2019 (in thousands, except per share amounts):


	Three Months Ended March 31,
			2020			2019
Numerator:
Net income (loss)	$	8,159		$	(2,771)







Denominator:
Weighted average common shares outstanding—basic	42,032			41,240
Computation of diluted securities:
Dilutive effect of stock options	585			—
Dilutive effect of RSUs	168			—



Weighted average common shares outstanding—diluted	42,785			41,240
Net income (loss) per share:
Basic and diluted net income (loss) per common share	$	0.19		$	(0.07)

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

The following outstanding stock options, RSUs and ESPP purchase options are antidilutive in the periods presented (in thousands):


	Three Months Ended March 31,
	2020	2019
Weighted average number of stock options	5,343	5,792
Weighted average number of RSUs	2	559

Weighted average ESPP purchase options	40	37

Total	5,385	6,388

INCOME TAXES (Tables)

3 Months Ended

Mar. 31, 2020

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 March 31,
	2020		2019
Income (loss) before income taxes:
Domestic	$	13,046	$	1,819
Foreign	(4,489)		(4,337)
Total income (loss) before income taxes	$	8,557	$	(2,518)

ACQUISITION–RELATED (GAINS) CHARGES AND PRODUCT DISCONTINUATION, NET (Tables)

3 Months Ended

Mar. 31, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]


	Severance and Related Costs		Asset Retirement Obligations, Other Restructuring and Discontinuation Costs		Total
Balance at December 31, 2019	$	81	$558		$	639
Charges incurred	—		166		166
Cash payments made	—		(292)		(292)
Balance at March 31, 2020	$	81	$	432	$	513

DESCRIPTION OF BUSINESS (Details)	3 Months Ended
DESCRIPTION OF BUSINESS (Details)	Mar. 31, 2020 product segment
Concentration Risk [Line Items]
Number of reportable segments \| segment	1
Sales Revenue, Net \| Product Concentration Risk
Concentration Risk [Line Items]
Concentration of products (in products) \| product	2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2020 USD ($) customer	Mar. 31, 2019
Concentration of Major Customers
Accounts Receivable, Allowance for Credit Loss \| $	$ 0
Concentration risk by major customer
Concentration of Major Customers
Number of major customers \| customer	3
Concentration risk by major customer \| Sales Revenue, Net
Concentration of Major Customers
Percentage of revenue from customers to total revenue	89.00%	91.00%
Concentration risk by major customer \| Sales Revenue, Net \| Largest wholesaler
Concentration of Major Customers
Percentage of revenue from customers to total revenue	32.00%	36.00%
Concentration risk by major customer \| Sales Revenue, Net \| Second largest wholesaler
Concentration of Major Customers
Percentage of revenue from customers to total revenue	31.00%	29.00%
Concentration risk by major customer \| Sales Revenue, Net \| Third largest wholesaler
Concentration of Major Customers
Percentage of revenue from customers to total revenue	26.00%	26.00%

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES New Accounting Pronouncements or change in Accounting Policy (Details) - USD ($) $ in Thousands	Jan. 01, 2019	Mar. 31, 2020	Dec. 31, 2019
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Total operating lease liabilities		$ 44,157
ROU asset		$ 37,613	$ 38,124
Accounting Standards Update 2016-02
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Total operating lease liabilities	$ 36,500
ROU asset	27,600
Cumulative-effect adjustment to retained earnings	$ 200

REVENUE (Details) - USD ($) $ in Thousands	3 Months Ended
REVENUE (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Mar. 31, 2019
Disaggregation of Revenue [Line Items]
Total net product sales	$ 104,745	$ 90,906
EXPAREL / bupivacaine liposome injectable suspension
Disaggregation of Revenue [Line Items]
Total net product sales	102,475	90,906
iovera°
Disaggregation of Revenue [Line Items]
Total net product sales	$ 2,270	$ 0
Minimum
Disaggregation of Revenue [Line Items]
Accounts receivable, payment terms	0 days
Maximum
Disaggregation of Revenue [Line Items]
Accounts receivable, payment terms	37 days

MYOSCIENCE ACQUISITION (Details) - USD ($) $ in Thousands		3 Months Ended
MYOSCIENCE ACQUISITION (Details) - USD ($) $ in Thousands	Apr. 09, 2019	Mar. 31, 2020	Jun. 30, 2020	Dec. 31, 2019
Business Acquisition [Line Items]
Contingent consideration, current		$ 14,041		$ 18,179
Acquisition-related contingent consideration		10,000
Achievement of Regulatory Milestone
Business Acquisition [Line Items]
Acquisition-related contingent consideration		5,000
Scenario, Forecast \| Achievement of Regulatory Milestone
Business Acquisition [Line Items]
Acquisition-related contingent consideration			$ 10,000
Myoscience Acquisition
Business Acquisition [Line Items]
Total consideration transferred		147,500
Initial cash payment		119,000
Fair value of contingent consideration	$ 28,500
Contingent consideration		100,000
Contingent consideration, current		68,000
Payment term	60 days
Acquisition-related contingent consideration		29,300
Contingent consideration maximum amount payable in shares		$ 5,000

MYOSCIENCE ACQUISITION - Unaudited Pro Forma Summary of Operations (Details) - Myoscience Acquisition $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2019 USD ($) $ / shares
Business Acquisition [Line Items]
Total revenues	$ 93,453
Net loss	$ (8,102)
Pro forma basic and diluted net loss per share \| $ / shares	$ (200)

INVENTORIES (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Inventory Disclosure [Abstract]
Raw materials	$ 23,162	$ 20,019
Work-in-process	7,757	14,407
Finished goods	28,747	23,870
Total	$ 59,666	$ 58,296

FIXED ASSETS (Details) - USD ($) $ in Thousands	3 Months Ended
FIXED ASSETS (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2019
FIXED ASSETS
Total	$ 186,299		$ 180,121
Less: accumulated depreciation	(78,194)		(75,440)
Fixed assets, net	108,105		104,681
Depreciation expense	2,900	$ 3,600
Foreign property, plant and equipment, net	64,000		64,800
Machinery and equipment
FIXED ASSETS
Total	70,061		70,078
Leasehold improvements
FIXED ASSETS
Total	60,441		60,441
Computer equipment and software
FIXED ASSETS
Total	9,003		8,942
Office furniture and equipment
FIXED ASSETS
Total	1,882		1,882
Construction in progress
FIXED ASSETS
Total	44,912		$ 38,778
Capitalized interest (Note 4)	$ 100	$ 0

LEASES -Narrative (Details)	Mar. 31, 2020
Minimum
Term of contract	5 months
Maximum
Term of contract	10 years 4 months 24 days

LEASES -Summary of operating lease cost and other operating lease information (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Operating lease costs:
Fixed lease costs	$ 1,564	$ 1,443
Variable lease costs	448	381
Total	2,012	1,824
Cash Flow, Operating Activities, Lessee [Abstract]
Cash paid for operating lease liabilities	2,759	2,050
Right-of-use assets recorded in exchange for lease obligations	$ 174	$ 34,780
Operating Lease, Weighted Average Remaining Lease Term	9 years 2 months 23 days
Operating Lease, Weighted Average Discount Rate, Percent	7.55%

LEASES -Schedule of maturities of operating lease liabilities (Details) $ in Thousands	Mar. 31, 2020 USD ($)
Leases [Abstract]
2020 (remaining nine months)	$ 6,116
2021	6,330
2022	5,875
2023	6,013
2024	6,155
2025 through 2030	32,830
Total lease payments	63,319
Less: imputed interest	(19,162)
Total operating lease liabilities	$ 44,157

LEASES -Schedule of maturities of operating lease liabilities (lease not yet commenced) (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2020 USD ($) contract
Leases [Abstract]
Number of leases not yet commenced \| contract	1
2020 (remaining nine months)	$ 7,124
2021	4,415
2022	4,548
2023	4,684
2024	4,825
2025 through 2030	29,242
Total future lease payments	$ 54,838

GOODWILL AND INTANGIBLE ASSETS (Details) - USD ($)	3 Months Ended
GOODWILL AND INTANGIBLE ASSETS (Details) - USD ($)	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2019	Apr. 09, 2019
Goodwill
Goodwill	$ 99,547,000		$ 99,547,000
Goodwill recorded in connection with the acquisition	99,547,000		99,547,000
Amortization of acquired intangible assets	1,967,000	$ 0
Amortization expense, remainder of fiscal year	5,900,000
Amortization expense, 2020-2032	7,900,000
Amortization expense, 2033	2,200,000
Myoscience Acquisition
Goodwill
Goodwill				$ 37,500,000
Goodwill recorded in connection with the acquisition				$ 37,500,000
Skye Pharma Holding Inc.
Goodwill
Goodwill	62,000,000.0
Goodwill recorded in connection with the acquisition	62,000,000.0
Skye Pharma Holding Inc.
Goodwill
Total Milestone Payments Yet to be Paid for Sale of Product in Connection with Acquisition			$ 36,000,000.0
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
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
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 - Schedule of Intangible Assets (Details) - USD ($)	3 Months Ended		12 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2019
Acquired Finite-Lived Intangible Assets [Line Items]
Gross Carrying Value	$ 110,090,000		$ 110,090,000
Accumulated Amortization	(7,669,000)		(5,703,000)
Intangible Assets, Net	102,421,000		104,387,000
Amortization of acquired intangible assets	1,967,000	$ 0
Developed technology
Acquired Finite-Lived Intangible Assets [Line Items]
Gross Carrying Value	110,000,000		110,000,000
Accumulated Amortization	(7,660,000)		(5,696,000)
Intangible Assets, Net	$ 102,340,000		$ 104,304,000
Estimated Useful Life	14 years		14 years
Customer relationships
Acquired Finite-Lived Intangible Assets [Line Items]
Gross Carrying Value	$ 90,000		$ 90,000
Accumulated Amortization	(9,000)		(7,000)
Intangible Assets, Net	$ 81,000		$ 83,000
Estimated Useful Life	10 years		10 years

DEBT - Schedule of Debt (Details) - Unsecured Debt - Convertible Senior Notes Due 2022 - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019	Mar. 13, 2017
Debt Instrument [Line Items]
Stated interest rate (as a percent)	2.375%		2.375%
Convertible senior notes, gross	$ 345,000	$ 345,000
Deferred financing costs	(3,704)	(4,143)
Discount on debt	(31,218)	(34,812)
Total debt, net of debt discount and deferred financing costs	$ 310,078	$ 306,045

DEBT - Narrative (Details 2) - USD ($)		3 Months Ended
DEBT - Narrative (Details 2) - USD ($)	Mar. 13, 2017	Mar. 31, 2020	Mar. 07, 2017
DEBT AND FINANCING OBLIGATIONS
Settlement period - convertible debt conversion request		40 days
Closing sale price (in dollars per share)		$ 33.53
Convertible Senior Notes Due 2022
DEBT AND FINANCING OBLIGATIONS
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
Convertible debt, premium on common stock	37.50%
Closing sale price (in dollars per share)			$ 48.65
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 as percentage of conversion price	130.00%
Convertible debt, common stock closing sales price minimum, number of trading days	20 days
Convertible debt, number of consecutive trading days	30 days
Principal amount used for debt instrument conversion ratio		$ 1,000
Market price per $1000 of principal amount of notes		960
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 as percentage of conversion price	130.00%
Convertible debt, common stock closing sales price minimum, number of trading days	20 days
Convertible debt, number of consecutive trading days	30 days
Debt Instrument Conversion Obligation 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
Principal amount used for debt instrument conversion ratio		$ 1,000
Unsecured Debt \| Convertible Senior Notes Due 2022
DEBT AND FINANCING OBLIGATIONS
Debt issued in private placement	$ 345,000,000.0
Stated interest rate (as a percent)	2.375%	2.375%

DEBT (Details 3) - USD ($) $ in Thousands	3 Months Ended
DEBT (Details 3) - USD ($) $ in Thousands	Mar. 31, 2020	Mar. 31, 2019
Amortization of debt discount	$ 3,594	$ 3,345
Effective interest rate on convertible senior notes	7.81%	7.81%
Convertible Senior Notes Due 2019
Contractual interest expense	$ 2,049	$ 2,049
Amortization of debt issuance costs	439	420
Amortization of debt discount	3,594	3,345
Capitalized interest and other (Note 6)	(60)	0
Total	$ 6,022	$ 5,814

FINANCIAL INSTRUMENTS (Details)	3 Months Ended		6 Months Ended
FINANCIAL INSTRUMENTS (Details)	Mar. 31, 2020 USD ($) customer	Mar. 31, 2019 USD ($)	Jun. 30, 2018 customer	Dec. 31, 2019 USD ($)
Concentration Risk [Line Items]
Acquisition-related contingent consideration	$ 10,000,000.0
Interest receivable	1,600,000			$ 1,000,000.0
Investment in convertible preferred B shares	6,100,000			$ 10,000,000.0
Unrealized Gain (Loss) on Investments	$ 4,000,000.0	$ 0
Number of major customers \| customer	3		3
Amount of allowance for doubtful accounts	$ 0
Accounts receivable \| Credit risk \| Major customer one
Concentration Risk [Line Items]
Concentration risk (as a percent)	32.00%		37.00%
Accounts receivable \| Credit risk \| Major customer two
Concentration Risk [Line Items]
Concentration risk (as a percent)	29.00%		29.00%
Accounts receivable \| Credit risk \| Major customer three
Concentration Risk [Line Items]
Concentration risk (as a percent)	28.00%		26.00%
Myoscience Acquisition
Concentration Risk [Line Items]
Acquisition-related contingent consideration	$ 29,300,000
Change in fair value of the contingent consideration since acquisition	3,900,000
Myoscience Acquisition \| Level 3
Concentration Risk [Line Items]
Acquisition-related contingent consideration	$ 29,268,000
Contingent Consideration \| Myoscience Acquisition \| Measurement Input, Discount Rate \| Level 3
Concentration Risk [Line Items]
Measurement input, contingent consideration	0.097
Contingent Consideration \| Myoscience Acquisition \| Measurement Input, Expected Milestone Payment \| Level 3
Concentration Risk [Line Items]
Measurement input, contingent consideration	0.446

FINANCIAL INSTRUMENTS - Fair Value of Liabilities Measured on a Recurring Basis (Details 1) - USD ($) $ / shares in Units, $ in Thousands, shares in Millions	Mar. 13, 2017	Mar. 31, 2020	Mar. 07, 2017
Fair Value Measurements
Acquisition-related contingent consideration		$ 10,000
Closing sale price (in dollars per share)		$ 33.53
Myoscience Acquisition
Fair Value Measurements
Acquisition-related contingent consideration		$ 29,300
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
Convertible Senior Notes Due 2022 \| Maximum
Fair Value Measurements
Debt Instrument, Convertible, Conversion Premium, Shares	5.2
Level 1
Fair Value Measurements
Equity Investments		6,053
Level 1 \| Myoscience Acquisition
Fair Value Measurements
Acquisition-related contingent consideration		0
Level 1 \| Convertible Senior Notes Due 2022
Fair Value Measurements
Convertible senior notes		0
Level 2
Fair Value Measurements
Equity Investments		0
Level 2 \| Myoscience Acquisition
Fair Value Measurements
Acquisition-related contingent consideration		0
Level 2 \| Convertible Senior Notes Due 2022
Fair Value Measurements
Convertible senior notes		331,200
Level 3
Fair Value Measurements
Equity Investments		0
Level 3 \| Myoscience Acquisition
Fair Value Measurements
Acquisition-related contingent consideration		29,268
Level 3 \| Convertible Senior Notes Due 2022
Fair Value Measurements
Convertible senior notes		0
Carrying Value
Fair Value Measurements
Equity Investments		6,053
Carrying Value \| Myoscience Acquisition
Fair Value Measurements
Acquisition-related contingent consideration		29,268
Carrying Value \| Convertible Senior Notes Due 2022
Fair Value Measurements
Convertible senior notes		$ 310,078
Unsecured Debt \| Convertible Senior Notes Due 2022
Fair Value Measurements
Stated interest rate (as a percent)	2.375%	2.375%

FINANICIAL INSTRUMENTS - Fair Value Measurement Inputs and Valuation (Details 2) $ in Thousands	Mar. 31, 2020 USD ($)
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Total Milestone Payments Yet To Be Paid in Connection with MyoScience Acquisition	$ 68,000
Acquisition-related contingent consideration	10,000
Myoscience Acquisition
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Acquisition-related contingent consideration	29,300
Myoscience Acquisition \| Fair Value, Inputs, Level 3
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Acquisition-related contingent consideration	$ 29,268
Myoscience Acquisition \| Contingent Consideration \| Fair Value, Inputs, Level 3 \| Measurement Input, Discount Rate
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Measurement input, contingent consideration	0.097
Myoscience Acquisition \| Contingent Consideration \| Fair Value, Inputs, Level 3 \| Measurement Input, Expected Milestone Payment
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Measurement input, contingent consideration	0.446
Myoscience Acquisition \| Contingent Consideration \| Minimum \| Fair Value, Inputs, Level 3 \| Measurement Input, Discount Rate
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Measurement input, contingent consideration	0.0955
Myoscience Acquisition \| Contingent Consideration \| Minimum \| Fair Value, Inputs, Level 3 \| Measurement Input, Expected Milestone Payment
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Measurement input, contingent consideration	0.03
Myoscience Acquisition \| Contingent Consideration \| Maximum \| Fair Value, Inputs, Level 3 \| Measurement Input, Discount Rate
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Measurement input, contingent consideration	0.0982
Myoscience Acquisition \| Contingent Consideration \| Maximum \| Fair Value, Inputs, Level 3 \| Measurement Input, Expected Milestone Payment
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Measurement input, contingent consideration	1

FINANCIAL INSTRUMENTS - Fair Value of Liabilities Measured on a Recurring Basis (Details 3) - Contingent Consideration $ in Thousands	3 Months Ended
	Mar. 31, 2020 USD ($)
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance at December 31, 2019	$ 38,142
Fair value adjustments and accretion	(3,874)
Payments made	(5,000)
Balance at March 31, 2020	$ 29,268

FINANCIAL INSTRUMENTS - Schedule of Available For Sale Securities (Details 4) - USD ($)	3 Months Ended		12 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2019
Fair Value Measurements
Unrealized Gain (Loss) on Investments	$ 4,000,000.0	$ 0
Level 2
Fair Value Measurements
Cost	300,041,000		$ 278,198,000
Gross Unrealized Gains	171,000		346,000
Gross Unrealized Losses	(1,217,000)		(24,000)
Fair Value	298,995,000		278,520,000
Level 2 \| Short-term Investments
Fair Value Measurements
Cost	264,579,000		213,428,000
Gross Unrealized Gains	144,000		299,000
Gross Unrealized Losses	(848,000)		(5,000)
Fair Value	263,875,000		213,722,000
Level 2 \| Long-Term Investments
Fair Value Measurements
Cost	35,462,000		64,770,000
Gross Unrealized Gains	27,000		47,000
Gross Unrealized Losses	(369,000)		(19,000)
Fair Value	35,120,000		64,798,000
Level 2 \| Asset-backed securities \| Short-term Investments
Fair Value Measurements
Cost	57,327,000		43,166,000
Gross Unrealized Gains	64,000		54,000
Gross Unrealized Losses	(130,000)		0
Fair Value	57,261,000		43,220,000
Level 2 \| Asset-backed securities \| Long-Term Investments
Fair Value Measurements
Cost	6,175,000		28,064,000
Gross Unrealized Gains	23,000		10,000
Gross Unrealized Losses	0		(15,000)
Fair Value	6,198,000		28,059,000
Level 2 \| Commercial paper \| Short-term Investments
Fair Value Measurements
Cost	28,878,000		32,250,000
Gross Unrealized Gains	26,000		20,000
Gross Unrealized Losses	0		0
Fair Value	28,904,000		32,270,000
Level 2 \| Corporate bonds \| Short-term Investments
Fair Value Measurements
Cost	178,374,000		138,012,000
Gross Unrealized Gains	54,000		225,000
Gross Unrealized Losses	(718,000)		(5,000)
Fair Value	177,710,000		138,232,000
Level 2 \| Corporate bonds \| Long-Term Investments
Fair Value Measurements
Cost	29,287,000		36,706,000
Gross Unrealized Gains	4,000		37,000
Gross Unrealized Losses	(369,000)		(4,000)
Fair Value	$ 28,922,000		$ 36,739,000

STOCK PLANS (Details) $ in Thousands	3 Months Ended
STOCK PLANS (Details) $ in Thousands	Mar. 31, 2020 USD ($) numberOfOfferingPeriods shares	Mar. 31, 2019 USD ($)
Share-Based Compensation
Stock-based compensation expense	$ 8,847	$ 7,434
Compensation expense from stock options, employees	6,225	5,121
Restricted Stock or Unit Expense	2,402	2,107
Compensation expense from employee stock purchase plan	220	206
Stock-based compensation	$ 8,847	7,434
Purchase price of common stock, ESPP (as a percent)	85.00%
Shares issued under employee stock purchase plan (shares) \| shares	0
Employee Stock
Share-Based Compensation
Number of offering periods for ESPP \| numberOfOfferingPeriods	2
ESPP purchasing period	6 months
Cost of goods sold
Share-Based Compensation
Stock-based compensation expense	$ 1,219	1,091
Research and development
Share-Based Compensation
Stock-based compensation expense	1,186	1,218
Selling, general and administrative
Share-Based Compensation
Stock-based compensation expense	$ 6,442	$ 5,125

STOCK PLANS (Details 2)	3 Months Ended
STOCK PLANS (Details 2)	Mar. 31, 2020 $ / shares shares
Weighted Average Exercise Price
Weighted average fair value (in dollars per share)	$ 20.97
Employee Stock Option
Number of Options
Outstanding beginning of period (in shares) \| shares	6,706,378
Granted (in shares) \| shares	188,450
Exercised (in shares) \| shares	(207,548)
Forfeited (in shares) \| shares	(91,069)
Expired (in shares) \| shares	(14,057)
Outstanding end of period (in shares) \| shares	6,582,154
Weighted Average Exercise Price
Outstanding beginning of period (in dollars per share)	$ 42.80
Granted (in dollars per share)	43.53
Exercised (in dollars per share)	16.64
Forfeited (in dollars per share)	41.66
Expired (in dollars per share)	63.34
Outstanding at end of period (in dollars per share)	$ 43.62

STOCK PLANS (Details 3)	3 Months Ended
STOCK PLANS (Details 3)	Mar. 31, 2020 $ / shares shares
Restricted Stock Units (RSUs)
Number of Units
Unvested at beginning of period (shares) \| shares	631,141
Granted (shares) \| shares	350
Vested (shares) \| shares	(849)
Forfeited (shares) \| shares	(15,567)
Unvested at end of period (shares) \| shares	615,075
Weighted Average Grant Date Fair Value
Unvested at beginning of period (usd per share) \| $ / shares	$ 41.87
Granted (usd per share) \| $ / shares	43.27
Vested (usd per share) \| $ / shares	48.16
Forfeited (usd per share) \| $ / shares	41.89
Unvested at end of period (usd per share) \| $ / shares	$ 41.86
Employee Stock Option
Weighted Average Grant Date Fair Value
Risk free interest rate (as a percent)	1.35%
Expected volatility (as a percent)	53.90%
Expected term of options	5 years 2 months 26 days

STOCKHOLDERS' EQUITY (Details) - USD ($) $ in Thousands	3 Months Ended
STOCKHOLDERS' EQUITY (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Mar. 31, 2019
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance at beginning of period	$ 322
Balance at end of period	(1,046)
Accumulated Net Unrealized Investment Gain (Loss)
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance at beginning of period	322	$ (280)
Other comprehensive income (loss) before reclassifications	(1,368)	462
Amounts reclassified from accumulated other comprehensive income (loss)	0	0
Balance at end of period	$ (1,046)	$ 182

NET INCOME (LOSS) PER SHARE (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Numerator:
Net income (loss)	$ 8,159	$ (2,771)
Denominator:
Weighted average common shares outstanding - basic (in shares)	42,032	41,240
Computation of diluted securities:
Dilutive effect of stock options	585	0
Dilutive effect of RSUs	168	0
Weighted average number of shares outstanding - diluted (in shares)	42,785	41,240
Net income (loss) per share:
Basic and diluted net income (loss) per common share (in USD per share)	$ 0.19	$ (0.07)

NET INCOME (LOSS) PER SHARE (Details 2) - shares shares in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
EARNINGS PER SHARE
Total	5,385	6,388
Employee Stock Option
EARNINGS PER SHARE
Total	5,343	5,792
Restricted Stock Units (RSUs)
EARNINGS PER SHARE
Total	2	559
Employee Stock
EARNINGS PER SHARE
Total	40	37

INCOME TAXES INCOME TAXES (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Income Tax Disclosure [Abstract]
Domestic	$ 13,046	$ 1,819
Foreign	(4,489)	(4,337)
Income (loss) before income taxes	8,557	(2,518)
Income Tax Expense (Benefit)	$ 398	253
Income tax expense (less than)		$ 300

ACQUISITION–RELATED (GAINS) CHARGES AND PRODUCT DISCONTINUATION, NET (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Business Acquisition [Line Items]
Non-recurring charge related to discontinuation	$ 100	$ 100
Contingent Consideration
Business Acquisition [Line Items]
Fair value adjustments to contingent consideration	3,874
Myoscience Acquisition
Business Acquisition [Line Items]
Acquisition-related costs	3,700	1,200
Myoscience Acquisition \| Advisory Costs
Business Acquisition [Line Items]
Acquisition-related costs	$ 200	$ 1,200

ACQUISITION–RELATED (GAINS) CHARGES AND PRODUCT DISCONTINUATION, NET- DepoCyte Product Discontinuance (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
DepoCyte Discontinuation [Line Items]
Discontinued Operation, Tax Effect of Gain (Loss) from Disposal of Discontinued Operation	$ 100	$ 100
DepoCyte Discontinuation [Roll Forward]
Acquisition-Related Separation Costs, Beginning Balance	81
Acquisition-Related Separation Costs, Charges Incurred	0
Acquisition-Related Separation Costs, Cash Payments Made	0
Acquisition-Related Separation Costs, Ending Balance	81
Asset Retirement Obligations, Other Restructuring and Discontinuation Costs, Beginning Balance	558
Asset Retirement Obligations, Other Restructuring and Discontinuation Costs, Charges Incurred	166
Asset Retirement Obligations, Other Restructuring and Discontinuation Costs, Cash Payments Made	(292)
Asset Retirement Obligations, Other Restructuring and Discontinuation Costs, Ending Balance	432
Total, Beginning Balance	639
Total, Charges Incurred	3,708	$ (1,242)
Total, Cash Payments Made	(292)
Total, Ending Balance	513
DepoCyte
DepoCyte Discontinuation [Roll Forward]
Total, Charges Incurred	$ 166

COMMITMENTS AND CONTINGENCIES - Narrative (Details) $ in Millions	1 Months Ended
	Dec. 31, 2019 USD ($)
Commitments and Contingencies Disclosure [Abstract]
Litigation settlement, amount awarded to other party	$ 3.5