Income Taxes

12 Months Ended

Dec. 31, 2020

The Company’s loss from operations before income tax expense by jurisdiction for the years ended December 31 are as follows (in thousands):


	2020		2019		2018
Domestic	$	(455,253)	$	(124,189)	$	(176,290)
Foreign	36,994		(8,505)		(8,458)
Total net loss	$	(418,259)	$	(132,694)	$	(184,748)

As a result of current and historical losses, there is no income tax provision for the years ended December 31, 2020, 2019 and 2018.

A reconciliation of the provision for income tax to the amount computed by applying the U.S. federal statutory tax rate to the Company’s effective tax rate is as follows:


	2020		2019		2018
Statutory federal tax rate	(21)	%	(21)	%	(21)	%
State income taxes, net of federal benefit	(3)	%	(2)	%	(3)	%
Research and development and other tax credits	—	%	(3)	%	(3)	%
Non-deductible expenses	4	%	—	%	—	%
Non-cash stock-based compensation	(7)	%	—	%	—	%
Other	1	%	1	%	1	%
Change in tax rate	(5)	%	3	%	5	%
Change in valuation allowance	31	%	22	%	21	%
Income tax provision	—	%	—	%	—	%

As of December 31, 2020, the Company has available federal, state, and foreign net operating losses of $1.3 billion, $756.0 million and $42.7 million, respectively, that may be applied against future taxable income. A significant portion of the federal net operating losses will begin to expire in 2037. A portion of the foreign net operating losses will begin to expire in 2023. The Company also has research tax credits of $35.1 million that begin to expire in 2020. Utilization of the net operating loss carryforwards and credits may be subject to an annual limitation due to ownership changes of the Company. As of December 31, 2020, the Company does not expect such limitation, if any, to impact the use of the net operating losses and business tax credits.

The Company files income tax returns in the U.S. federal jurisdiction and in various states, as well as in Sweden and the Czech Republic. The Company has U.S. tax net operating losses and credit carryforwards that are subject to examination from 2000 through 2020. The returns in Sweden are subject to examination from 2014 through 2020 and the returns for the Czech Republic are subject to examination from 2017 through 2020.

The significant components of the Company’s deferred tax assets and liabilities as of December 31 were as follows (in thousands):


	2020		2019
Deferred tax assets:
Federal and State net operating loss carryforward	$	325,655	$	293,736
Foreign net operating loss carryforward	8,620		13,520
Research tax credits	35,065		37,066
Lease liability	39,548		2,164
Deferred revenue	60,657		973
Non-cash stock-based compensation	22,577		13,679
Original discount interest	3,177		4,326
Other	12,019		2,820
Total deferred tax assets	507,318		368,284
Valuation allowance	(504,788)		(365,772)
Net deferred tax assets	$	2,530	$	2,512
Deferred tax liabilities:
ROU assets	(1,253)		(1,033)
Intangibles	(1,198)		(1,279)
Other	(79)		(200)
Total deferred tax liabilities	$	(2,530)	$	(2,512)
Net deferred tax assets	$	—	$	—

The valuation allowance increased by $139.0 million and $28.3 million for the years ended December 31, 2020 and 2019, respectively, due to increases in deferred tax assets. Realization of net deferred tax assets is dependent on the Company’s ability to generate future taxable income, which is uncertain. Accordingly, a full valuation allowance was recorded against these assets as of December 31, 2020 and 2019 as management believes it is more likely than not that the assets will not be realizable.

The Company recognizes the effect of a tax position when it is more likely than not, based on the technical merits, that the tax position will be sustained upon examination. A reconciliation of the beginning and ending amounts of unrecognized tax benefits in the year ended December 31, 2020, 2019 and 2018 is as follows (in thousands):


	2020		2019		2018
Unrecognized tax benefits balance at January 1,	$	—	$	—	$	—
Additions for tax positions of current year	1,413		—		—
Additions for tax positions of prior years	7,353		—		—
Reductions for tax positions of prior year	—		—		—
Settlements of tax positions of prior years	—		—		—
Unrecognized tax benefits balance at December 31,	$	8,766	$	—	$	—

The Company’s policy is to recognize interest and penalties related to income tax matters in income tax expense. As of December 31, 2020 and 2019, the Company had no accruals for interest or penalties related to income tax matters.