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Document and Entity Information - USD ($) $ in Billions	12 Months Ended
Document and Entity Information - USD ($) $ in Billions	Dec. 31, 2018	Jan. 31, 2019	Jun. 29, 2018
Document and Entity Information [Abstract]
Entity Registrant Name	VERTEX PHARMACEUTICALS INC / MA
Entity Central Index Key	0000875320
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Document Type	10-K
Document Period End Date	Dec. 31, 2018
Document Fiscal Year Focus	2018
Document Fiscal Period Focus	FY
Amendment Flag	false
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Public Float			$ 42.5
Entity Common Stock, Shares Outstanding		255,656,889
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes

Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Revenues:
Revenues	$ 870,106	$ 784,535	$ 752,157	$ 640,799	$ 651,634	$ 578,165	$ 544,135	$ 714,718	$ 3,047,597	$ 2,488,652	$ 1,702,177
Costs and expenses:
Cost of sales	122,289	111,255	104,382	71,613	84,052	72,874	71,205	46,988	409,539	275,119	210,460
Research and development expenses	437,881	330,510	337,532	310,553	306,664	454,947	289,451	273,563	1,416,476	1,324,625	1,047,690
Sales, general and administrative expenses	153,210	137,295	137,303	129,808	134,794	120,710	127,249	113,326	557,616	496,079	432,829
Restructuring (income) expenses	4	(174)	62	(76)	387	337	3,523	9,999	(184)	14,246	1,262
Intangible asset impairment charges	29,000	0	0	0	0	255,340	0	0	29,000	255,340	0
Total costs and expenses	742,384	578,886	579,279	511,898	525,897	904,208	491,428	443,876	2,412,447	2,365,409	1,692,241
Income from operations	127,722	205,649	172,878	128,901	125,737	(326,043)	52,707	270,842	635,150	123,243	9,936
Interest expense, net	(4,773)	(8,143)	(10,106)	(11,097)	(12,547)	(13,574)	(14,664)	(16,765)	(34,119)	(57,550)	(81,432)
Other (expense) income, net	(90,452)	(60,995)	53,819	96,838	(748)	(77,553)	(2,537)	(544)	(790)	(81,382)	4,130
Income (loss) before (benefit from) provision for income taxes	32,497	136,511	216,591	214,642	112,442	(417,170)	35,506	253,533	600,241	(15,689)	(67,366)
(Benefit from) provision for income taxes	(1,492,599)	8,055	10,341	(12,659)	10,257	(125,903)	4,337	3,985	(1,486,862)	(107,324)	16,665
Net income (loss)	1,525,096	128,456	206,250	227,301	102,185	(291,267)	31,169	249,548	2,087,103	91,635	(84,031)
Loss (income) attributable to noncontrolling interest	25,431	290	1,110	(17,038)	(1,501)	188,315	(13,173)	(1,792)	9,793	171,849	(28,021)
Net income (loss) attributable to Vertex	$ 1,550,527	$ 128,746	$ 207,360	$ 210,263	$ 100,684	$ (102,952)	$ 17,996	$ 247,756	$ 2,096,896	$ 263,484	$ (112,052)
Net income (loss):
Basic (usd per share)	$ 6.08	$ 0.51	$ 0.82	$ 0.83	$ 0.40	$ (0.41)	$ 0.07	$ 1.01	$ 8.24	$ 1.06	$ (0.46)
Diluted (usd per share)	$ 5.97	$ 0.50	$ 0.80	$ 0.81	$ 0.39	$ (0.41)	$ 0.07	$ 0.99	$ 8.09	$ 1.04	$ (0.46)
Shares used in per share calculations:
Basic (in shares)	254,868	254,905	254,135	253,231	251,557	250,268	247,521	246,024	254,292	248,858	244,685
Diluted (in shares)	259,812	259,788	258,584	258,526	256,804	250,268	251,635	248,700	259,185	253,225	244,685
Product revenues, net
Revenues:
Revenues	$ 868,173	$ 782,511	$ 749,912	$ 637,729	$ 621,228	$ 549,642	$ 513,988	$ 480,622	$ 3,038,325	$ 2,165,480	$ 1,683,632
Collaborative and royalty revenues
Revenues:
Revenues	$ 1,933	$ 2,024	$ 2,245	$ 3,070	$ 30,406	$ 28,523	$ 30,147	$ 234,096	$ 9,272	$ 323,172	$ 18,545

Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Statement of Comprehensive Income [Abstract]
Net income (loss)	$ 2,087,103	$ 91,635	$ (84,031)
Changes in other comprehensive income (loss):
Unrealized holding gains on marketable securities, net of tax of zero, $(2.7) million and $(3.8) million, respectively	58	6,954	17,395
Unrealized gains (losses) on foreign currency forward contracts, net of tax of $(7.1) million, $3.4 million and $(3.9) million, respectively	27,438	(26,530)	7,736
Foreign currency translation adjustment	8,855	(13,169)	(5,782)
Total changes in other comprehensive income (loss)	36,351	(32,745)	19,349
Comprehensive income (loss)	2,123,454	58,890	(64,682)
Comprehensive loss (income) attributable to noncontrolling interest	9,793	171,849	(28,021)
Comprehensive income (loss) attributable to Vertex	$ 2,133,247	$ 230,739	$ (92,703)

Consolidated Statements of Comprehensive Income (Loss) (Parenthetical) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Statement of Comprehensive Income [Abstract]
Unrealized holding gains (losses) on marketable securities, tax	$ 0.0	$ (2.7)	$ (3.8)
Unrealized (losses) gains on foreign currency forward contracts, tax	$ (7.1)	$ 3.4	$ (3.9)

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Current assets:
Cash and cash equivalents	$ 2,650,134	$ 1,665,412
Marketable securities	518,108	423,254
Accounts receivable, net	409,688	281,343
Inventories	124,360	111,830
Prepaid expenses and other current assets	140,819	167,124
Total current assets	3,843,109	2,648,963
Property and equipment, net	812,005	789,437
Intangible assets	0	29,000
Goodwill	50,384	50,384
Deferred tax assets	1,499,672	834
Other assets	40,728	27,396
Total assets	6,245,898	3,546,014
Current liabilities:
Accounts payable	110,987	73,994
Accrued expenses	604,495	443,961
Capital lease obligations, current portion	9,817	22,531
Early access sales accrual	354,404	232,401
Other liabilities, current portion	40,589	34,373
Total current liabilities	1,120,292	807,260
Capital lease obligations, excluding current portion	19,658	20,496
Deferred tax liabilities	0	6,341
Construction financing lease obligation, excluding current portion	561,892	563,406
Advance from collaborator, excluding current portion	82,573	78,431
Other liabilities, excluding current portion	26,280	27,774
Total liabilities	1,810,695	1,503,708
Commitments and contingencies	0	0
Shareholders’ equity:
Preferred stock, $0.01 par value; 1,000,000 shares authorized; none issued and outstanding	0	0
Common stock, $0.01 par value; 500,000,000 shares authorized, 255,172,328 and 253,253,362 shares issued and outstanding, respectively	2,546	2,512
Additional paid-in capital	7,421,476	7,157,362
Accumulated other comprehensive income (loss)	659	(11,572)
Accumulated deficit	(2,989,478)	(5,119,723)
Total Vertex shareholders’ equity	4,435,203	2,028,579
Noncontrolling interest	0	13,727
Total shareholders’ equity	4,435,203	2,042,306
Total liabilities and shareholders’ equity	$ 6,245,898	$ 3,546,014

Consolidated Balance Sheets (Parenthetical) - $ / shares	Dec. 31, 2018	Dec. 31, 2017
Statement of Financial Position [Abstract]
Preferred stock, par value (usd per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized (shares)	1,000,000	1,000,000
Preferred stock, shares issued (shares)	0	0
Preferred stock, shares outstanding (shares)	0	0
Common stock, par value (usd per share)	$ 0.01	$ 0.01
Common stock, shares authorized (shares)	500,000,000	500,000,000
Common stock, shares issued (shares)	255,172,328	253,253,362
Common stock, shares outstanding (shares)	255,172,328	253,253,362

Consolidated Statements of Shareholders' Equity and Noncontrolling Interest - USD ($) $ in Thousands	Total	Total Vertex Shareholders' Equity	Common Stock	Additional Paid-in Capital	Accumulated Other Comprehensive Income (Loss)	Accumulated Deficit	Noncontrolling Interest
Balance (shares) at Dec. 31, 2015			246,307,000
Balance at Dec. 31, 2015	$ 1,093,628	$ 939,967	$ 2,427	$ 6,197,500	$ 1,824	$ (5,261,784)	$ 153,661
Increase (Decrease) in Stockholders' Equity
Other comprehensive income, net of tax	19,349	19,349			19,349
Net (loss) income	(84,031)	(112,052)				(112,052)	28,021
Issuance of common stock under benefit plans (shares)			1,994,000
Issuance of common stock under benefit plans	68,006	68,006	$ 23	67,983			0
Stock-based compensation expense	241,239	241,312		241,312			(73)
Balance (shares) at Dec. 31, 2016			248,301,000
Balance at Dec. 31, 2016	1,338,191	1,156,582	$ 2,450	6,506,795	21,173	(5,373,836)	181,609
Increase (Decrease) in Stockholders' Equity
Cumulative effect adjustment for adoption of new accounting guidance \| Accounting standards update 2016-09				9,371		(9,371)
Other comprehensive income, net of tax	(32,745)	(32,745)			(32,745)
Net (loss) income	91,635	263,484				263,484	(171,849)
Issuance of common stock under benefit plans (shares)			4,952,000
Issuance of common stock under benefit plans	345,673	345,616	$ 62	345,554			57
Stock-based compensation expense	295,642	295,642		295,642			0
VIE noncontrolling interest upon deconsolidation	3,910						3,910
Balance (shares) at Dec. 31, 2017			253,253,000
Balance at Dec. 31, 2017	2,042,306	2,028,579	$ 2,512	7,157,362	(11,572)	(5,119,723)	13,727
Increase (Decrease) in Stockholders' Equity
Cumulative effect adjustment for adoption of new accounting guidance \| Accounting standards update 2016-09	9,229	9,229			(24,120)	33,349
Other comprehensive income, net of tax	36,351	36,351			36,351
Net (loss) income	$ 2,087,103	2,096,896				2,096,896	(9,793)
Repurchase of common stock (shares)	(2,093,891)		(2,094,000)
Repurchases of common stock	$ (350,043)	(350,043)	$ (21)	(350,022)
Issuance of common stock under benefit plans (shares)			4,013,000
Issuance of common stock under benefit plans	288,535	288,535	$ 55	288,480
Stock-based compensation expense	325,656	325,656		325,656			0
VIE noncontrolling interest upon deconsolidation	(3,540)						(3,540)
Other VIE activity	(394)						(394)
Balance (shares) at Dec. 31, 2018			255,172,000
Balance at Dec. 31, 2018	$ 4,435,203	$ 4,435,203	$ 2,546	$ 7,421,476	$ 659	$ (2,989,478)	$ 0

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Cash flows from operating activities:
Net income (loss)	$ 2,087,103	$ 91,635	$ (84,031)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Stock-based compensation expense	325,047	293,236	240,623
Depreciation expense	72,420	61,397	61,398
Write-downs of inventories to net realizable value	20,413	15,292	0
Deferred income taxes (including benefit from valuation allowance release)	(1,512,325)	(120,513)	16,961
Unrealized gain on equity securities	(2,558)	0	0
Intangible asset impairment charges	29,000	255,340	0
Acquired in-process research and development	0	160,000	0
Deconsolidation of VIE	1,077	76,644	0
Other non-cash items, net	12,089	(853)	6,140
Changes in operating assets and liabilities:
Accounts receivable, net	(108,152)	(71,759)	(39,095)
Inventories	(31,965)	(47,484)	(19,368)
Prepaid expenses and other assets	16,684	(111,063)	(2,631)
Accounts payable	36,554	8,753	(11,745)
Accrued expenses and other liabilities	195,623	75,332	(5,565)
Early access sales accrual	129,276	158,985	73,416
Net cash provided by operating activities	1,270,286	844,942	236,103
Cash flows from investing activities:
Maturities of available-for-sale debt securities	431,576	369,214	757,562
Purchases of available-for-sale debt securities	(431,918)	(532,581)	(616,625)
Expenditures for property and equipment	(95,524)	(99,421)	(56,563)
Purchase of in-process research and development	0	(160,000)	0
Investment in note receivable	(15,000)	0	(20,000)
Investment in equity securities	(83,471)	0	(13,075)
Decrease in restricted cash due to deconsolidation of VIE	(7,896)	(61,602)	0
Other investing activities	75	1,061	(61)
Net cash used in (provided by) investing activities	(202,158)	(483,329)	51,238
Cash flows from financing activities:
Issuances of common stock under benefit plans	289,293	344,840	68,230
Repurchase of common stock	(350,043)	0	0
Payments on revolving credit facility	0	(300,000)	0
Advance from collaborator	7,500	12,500	75,000
Payments related to construction financing lease obligation	(5,462)	(541)	(432)
Proceeds related to construction financing lease obligation	9,566	27,182	0
Proceeds from capital lease financing	11,274	7,484	11,208
Payments on capital lease obligations	(27,926)	(18,795)	(17,597)
Repayments of advanced funding	(5,027)	(4,266)	0
Payments on senior secured term loan	0	0	(75,000)
Proceeds from revolving credit facility	0	0	74,965
Payments of debt issuance costs	0	0	(3,103)
Other financing activities	(394)	0	0
Net cash (used in) provided by financing activities	(71,219)	68,404	133,271
Effect of changes in exchange rates on cash	(6,182)	5,802	(4,666)
Net increase in cash, cash equivalents and restricted cash	990,727	435,819	415,946
Cash, cash equivalents and restricted cash—beginning of period	1,667,526	1,231,707	815,761
Cash, cash equivalents and restricted cash—end of period	2,658,253	1,667,526	1,231,707
Supplemental disclosure of cash flow information:
Cash paid for interest	66,458	68,696	83,656
Cash paid for (received from) income taxes	12,402	6,414	(2,579)
Non-cash investing and financing activities:
Capitalization of costs related to construction financing lease obligation	3,389	40,855	14,238
Issuances of common stock from employee benefit plans receivable	86	844	68
Proceeds from revolving credit facility directly paid to settle all outstanding obligations under the term loan	$ 0	$ 0	$ 225,000

Nature of Business and Accounting Policies

12 Months Ended

Dec. 31, 2018

Accounting Policies [Abstract]

Nature of Business and Accounting Policies

Business

Vertex Pharmaceuticals Incorporated (“Vertex” or the “Company”) invests in scientific innovation to create transformative medicines for serious diseases. The Company’s business is focused on developing and commercializing therapies for the treatment of cystic fibrosis (“CF”) and advancing research and development programs in other indications. The Company’s marketed products are SYMDEKO/SYMKEVI (tezacaftor in combination with ivacaftor), ORKAMBI (lumacaftor in combination with ivacaftor) and KALYDECO (ivacaftor), which are approved to treat patients with CF who have specific mutations in their cystic fibrosis transmembrane conductance regulator (“CFTR”) gene.

As of December 31, 2018, the Company had cash, cash equivalents and marketable securities of $3.2 billion. The Company expects that cash flows from the sales of its products, together with the Company’s cash, cash equivalents and marketable securities, will be sufficient to fund its operations for at least the next twelve months.

Vertex is subject to risks common to companies in its industry including, but not limited to, the dependence on revenues from its CF products, competition, uncertainty about clinical trial outcomes and regulatory approvals, uncertainties relating to pharmaceutical pricing and reimbursement, uncertainty related to international expansion, uncertain protection of proprietary technology, the need to comply with government regulations, share price volatility, dependence on collaborative relationships and potential product liability.

Basis of Presentation

The consolidated financial statements reflect the operations of (i) the Company, (ii) its wholly-owned subsidiaries and (iii) consolidated variable interest entities (“VIEs”). As of September 30, 2017, the Company deconsolidated Parion Sciences, Inc. (“Parion”), a VIE the Company had consolidated since 2015. As of December 31, 2018, the Company deconsolidated BioAxone Biosciences, Inc. (“BioAxone”), a VIE the Company had consolidated since 2014. As of December 31, 2018, the Company does not have any consolidated VIEs. All material intercompany balances and transactions have been eliminated. The Company operates in one segment, pharmaceuticals. Please refer to Note R, “Segment Information,” for enterprise-wide disclosures regarding the Company’s revenues, major customers and long-lived assets by geographic area. The Company has reclassified certain items from the prior year’s consolidated financial statements to conform to the current year’s presentation.

Use of Estimates

The preparation of consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the amounts of revenues and expenses during the reported periods. Significant estimates in these consolidated financial statements have been made in connection with the calculation of revenues, research and development expenses, the fair value of intangible assets, goodwill, noncontrolling interest, the consolidation and deconsolidation of VIEs, deferred tax asset valuation allowances and the provision for or benefit from income taxes. The Company bases its estimates on historical experience and various other assumptions, including in certain circumstances future projections, that management believes to be reasonable under the circumstances. Actual results could differ from those estimates. Changes in estimates are reflected in reported results in the period in which they become known.

Revenue Recognition

Pursuant to Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers (“ASC 606”), the Company recognizes revenue when a customer obtains control of promised goods or services. The Company records the amount of revenue that reflects the consideration that it expects to receive in exchange for those goods or services. The Company applies the following five-step model in order to determine this amount: (i) identification of the promised goods or services in the contract; (ii) determination of whether the promised goods or services are performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation.

The Company only applies the five-step model to contracts when it is probable that it will collect the consideration to which it is entitled in exchange for the goods or services that it transfers to the customer. Once a contract is determined to be within the scope of ASC 606 at contract inception, the Company reviews the contract to determine which performance obligations it must deliver and which of these performance obligations are distinct. The Company recognizes as revenue the amount of the transaction price that is allocated to each performance obligation when that performance obligation is satisfied or as it is satisfied. Generally, the Company's performance obligations are transferred to customers at a point in time, typically upon delivery.

Product Revenues, Net

The Company sells its products principally to a limited number of specialty pharmacy and specialty distributors in the United States, which account for the largest portion of its total revenues, and makes international sales primarily to specialty distributors and retail chains, as well as hospitals and clinics, many of which are government-owned or supported (collectively, its “Customers”). The Company’s Customers in the United States subsequently resell the products to patients and health care providers. In accordance with ASC 606, the Company recognizes net revenues from product sales when the Customers obtain control of the Company’s products, which typically occurs upon delivery to the Customer. The Company’s payment terms are approximately 30 days in the United States and consistent with prevailing practice in international markets.

Revenues from product sales are recorded at the net sales price, or “transaction price,” which includes estimates of variable consideration that result from (a) invoice discounts for prompt payment and distribution fees, (b) government and private payor rebates, chargebacks, discounts and fees and (c) costs of co-pay assistance programs for patients, as well as other incentives for certain indirect customers. Reserves are established for the estimates of variable consideration based on the amounts earned or to be claimed on the related sales. The reserves are classified as reductions to “Accounts receivable, net” if payable to a Customer or “Accrued expenses” if payable to a third-party. Where appropriate, the Company utilizes the expected value method to determine the appropriate amount for estimates of variable consideration based on factors such as the Company’s historical experience, current contractual and statutory requirements, specific known market events and trends, industry data and forecasted customer buying and payment patterns. The amount of variable consideration that is included in the transaction price may be constrained and is included in net product revenues only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period. Actual amounts of consideration ultimately received may differ from the Company’s estimates. If actual results vary from the Company’s estimates, the Company adjusts these estimates, which would affect net product revenue and earnings in the period such variances become known.

Invoice Discounts and Distribution Fees: The Company generally provides invoice discounts on product sales to its Customers for prompt payment and pays fees for distribution services, such as fees for certain data that Customers provide to the Company. The Company estimates that, based on its experience, its Customers will earn these discounts and fees, and deducts the full amount of these discounts and fees from its gross product revenues and accounts receivable at the time such revenues are recognized.

Rebates, Chargebacks, Discounts and Fees: The Company contracts with government agencies (its “Third-party Payors”) so that products will be eligible for purchase by, or partial or full reimbursement from, such Third-party Payors. The Company estimates the rebates, chargebacks, discounts and fees it will provide to Third-party Payors and deducts these estimated amounts from its gross product revenues at the time the revenues are recognized. For each product, the Company estimates the aggregate rebates, chargebacks and discounts that it will provide to Third-party Payors based upon (i) the Company’s contracts with these Third-party Payors, (ii) the government-mandated discounts and fees applicable to government-funded programs, (iii) information obtained from the Company’s Customers and other third-party data regarding the payor mix for such product and (iv) historical experience.

Other Incentives: Other incentives that the Company offers include co-pay mitigation rebates provided by the Company to commercially insured patients who have coverage and who reside in states that permit co-pay mitigation programs. Based upon the terms of the Company’s co-pay mitigation programs, the Company estimates average co-pay mitigation amounts for each of its products in order to establish appropriate accruals.

The Company makes significant estimates and judgments that materially affect its recognition of net product revenues. The Company adjusts its estimated rebates, chargebacks and discounts based on new information, including information regarding actual rebates, chargebacks and discounts for its products, as it becomes available. Claims by third-party payors for rebates, chargebacks and discounts frequently are submitted to the Company significantly after the related sales, potentially resulting in adjustments in the period in which the new information becomes known. The Company’s credits to product revenue related to prior period sales have not been significant and primarily related to rebates and discounts.

The Company excludes taxes collected from Customers relating to product sales and remitted to governmental authorities from revenues.

Contract Liabilities

The Company’s contract liabilities relate to annual contracts with government-owned and supported customers in international markets that limit the amount of annual reimbursement the Company can receive. Upon exceeding the annual reimbursement amount, products are provided free of charge, which is a material right pursuant to ASC 606. These contracts, which are classified as “Other liabilities, current portion,” include upfront payments and fees. The Company defers a portion of the consideration received for shipments made up to the annual reimbursement limit, and the deferred amount is recognized as revenue when the free products are shipped. The Company’s product revenue contracts include performance obligations that are one year or less.

The Company’s contract liabilities of $24.9 million and $1.7 million as of December 31, 2018 and 2017, respectively, represent balances related to contracts with annual reimbursement limits in several international markets in which the annual period associated with the contract is not the same as the Company’s fiscal year. In the majority of international markets in which the Company has a contract with an annual reimbursement limit, the annual period associated with the contract is the same as the Company’s fiscal year, resulting in no contract liability balance at the end of the year and no revenues recognized in the current year related to performance obligations satisfied in previous periods. For the international markets in which the periods associated with these annual contracts are not the same as the Company’s fiscal year, the Company recognizes revenues related to performance obligations satisfied in previous years; however, these amounts are not material to the Company’s financial statements and do not relate to any performance obligations that were satisfied more than 12 months prior to the beginning of the current year. The revenues recognized in the year ended December 31, 2018 related to performance obligations satisfied in the prior year were $1.7 million.

French Early Access Programs

Pursuant to ASC 605, Revenue Recognition (“ASC 605”), which was applicable until December 31, 2017, the Company only recognized revenues from product sales if it determined that the price was fixed or determinable at the time of delivery. If the Company determined that the price was not fixed or determinable, it deferred the recognition of revenues. If the Company was able to determine that the price was fixed or determinable, it recognized the net product revenues associated with the units.

The Company began distributing ORKAMBI through early access programs in France during the fourth quarter of 2015 and is engaged in ongoing pricing discussions regarding the final price for ORKAMBI in France. The Company’s ORKAMBI net product revenues for 2017, 2016 and 2015 did not include any net product revenues from sales of ORKAMBI in France because the price was not fixed or determinable. The Company expects that the difference between the amounts collected based on the invoiced price and the final price for ORKAMBI in France will be returned to the French government.

As of December 31, 2018 and 2017, the Company’s consolidated balance sheets included $354.4 million and $232.4 million, respectively, classified as “Early access sales accrual” related to amounts collected in France as payment for shipments of ORKAMBI under the early access programs, which is considered to be a refund liability pursuant to ASC 606.

Upon adopting ASC 606 in 2018, the Company recorded an $8.3 million cumulative effect adjustment to “Accumulated deficit” primarily related to shipments of ORKAMBI under the early access programs in France. The Company determined the amount of the adjustment based upon (i) the status of pricing discussions in France upon adoption, (ii) its estimate of the amount of consideration it expects to retain related to ORKAMBI sales in France that occurred on or prior to December 31, 2017 that will not be subject to a significant reversal in amounts recognized and (iii) recognition of costs previously deferred related to the ORKAMBI sales in France. For ORKAMBI sales in France that occurred after December 31, 2017 under the early access programs, the Company has recognized net product revenues based on the estimate of consideration it expects to retain that will not be subject to a significant reversal in amounts recognized. If the Company’s estimate regarding the amounts it will receive for ORKAMBI supplied pursuant to these early access programs changes, it will reflect the effect of the change in estimate in net product revenues in the period in which the change in estimate occurs and will include adjustments to all prior sales of ORKAMBI under the early access programs. Please refer to Recent Accounting Pronouncements included in this Note A, “Nature of Business and Accounting Policies,” below for more information regarding the revenue recognition guidance adopted as of January 1, 2018.

Collaborative and Royalty Revenues

The Company recognizes collaborative revenues generated through collaborative research, development and/or commercialization agreements. The terms of these agreements typically include payment to the Company related to one or more of the following: nonrefundable, upfront license fees; development and commercial milestones; funding of research and/or development activities; and royalties on net sales of licensed products. Revenue is recognized upon satisfaction of a performance obligation by transferring control of a good or service to the collaborator.

For each collaborative research, development and/or commercialization agreement that results in revenue, the Company identifies all material performance obligations, which may include a license to intellectual property and know-how, research and development activities and/or transition activities. In order to determine the transaction price, in addition to any upfront payment, the Company estimates the amount of variable consideration at the outset of the contract either utilizing the expected value or most likely amount method, depending on the facts and circumstances relative to the contract. The Company constrains (reduces) the estimate of variable consideration such that it is probable that a significant reversal of previously recognized revenue will not occur throughout the life of the contract. When determining if variable consideration should be constrained, management considers whether there are factors outside the Company’s control that could result in a significant reversal of revenue. In making these assessments, the Company considers the likelihood and magnitude of a potential reversal of revenue. These estimates are re-assessed each reporting period as required.

Once the estimated transaction price is established, amounts are allocated to the performance obligations that have been identified. The transaction price is generally allocated to each separate performance obligation on a relative standalone selling price basis. In order to account for these agreements, the Company must develop assumptions that require judgment to determine the standalone selling price, which may include (i) the probability of obtaining marketing approval for the drug candidate, (ii) estimates regarding the timing of and the expected costs to develop and commercialize the drug candidate, (iii) estimates of future cash flows from potential product sales with respect to the drug candidate and (iv) appropriate discount and tax rates. Standalone selling prices used to perform the initial allocation are not updated after contract inception. The Company does not include a financing component to its estimated transaction price at contract inception unless it estimates that certain performance obligations will not be satisfied within one year.

Upfront License Fees: If a license to the Company’s intellectual property is determined to be distinct from the other performance obligations identified in an arrangement, the Company recognizes revenue from the related nonrefundable, upfront license fees based on the relative standalone selling price prescribed to the license compared to the total selling price of the arrangement. The revenue is recognized when the license is transferred to the collaborator and the collaborator is able to use and benefit from the license. For licenses that are not distinct from other obligations identified in the arrangement, the Company utilizes judgment to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time. If the combined performance obligation is satisfied over time, the Company applies an appropriate method of measuring progress for purposes of recognizing revenue from nonrefundable, upfront license fees. The Company evaluates the measure of progress each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition.

Development and Regulatory Milestone Payments: Depending on facts and circumstances, the Company may conclude that it is appropriate to include certain milestones in the estimated transaction price or that it is appropriate to fully constrain the milestones. A milestone payment is included in the transaction price in the reporting period that the Company concludes that it is probable that recording revenue in the period will not result in a significant reversal in amounts recognized in future periods. The Company may record revenues from certain milestones in a reporting period before the milestone is achieved if the Company concludes that achievement of the milestone is probable and that recognition of revenue related to the milestone will not result in a significant reversal in amounts recognized in future periods. The Company records a corresponding contract asset when this conclusion is reached. Milestone payments that have not been included in the transaction price to date are fully constrained. These milestones remain fully constrained until the Company concludes that their achievement is probable and that recognition of the related revenue will not result in a significant reversal in amounts recognized in future periods. The Company re-evaluates the probability of achievement of such development milestones and any related constraint each reporting period and adjusts its estimate of the overall transaction price, including the amount of collaborative revenue that it has recorded, if necessary.

Research and Development Activities/Transition Services: If the Company is entitled to reimbursement from its collaborators for specified research and development expenses, it accounts for the related services that it provides as separate performance obligations if it determines that these services represent a material right. The Company also determines whether the reimbursement of research and development expenses should be accounted for as collaborative revenues or an offset to research and development expenses in accordance with the provisions of gross or net revenue presentation. The Company recognizes the corresponding revenues or records the corresponding offset to research and development expenses as it satisfies the related performance obligations.

Sales-based Milestone and Royalty Payments: The Company’s collaborators may be required to pay the Company sales-based milestones or royalties on future sales of commercial products. The Company recognizes revenues related to sales-based milestone and royalties upon the later to occur of (i) achievement of the collaborator’s underlying sales or (ii) satisfaction of any performance obligation(s) related to these sales, in each case assuming the license to the Company’s intellectual property is deemed to be the predominant item to which the sales-based milestones and/or royalties relate.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentration of credit risk consist principally of money market funds and marketable securities. The Company places these investments with highly rated financial institutions, and, by policy, limits the amounts of credit exposure to any one financial institution. These amounts at times may exceed federally insured limits. The Company also maintains a foreign currency hedging program that includes foreign currency forward contracts with several counterparties. The Company has not experienced any credit losses related to these financial instruments and does not believe it is exposed to any significant credit risk related to these instruments.

The Company also is subject to credit risk from its accounts receivable related to its product sales and collaborators. The Company evaluates the creditworthiness of each of its customers and has determined that all of its material customers are creditworthy. To date, the Company has not experienced significant losses with respect to the collection of its accounts receivable. The Company’s receivables from Greece, Italy, Portugal and Spain were not material as of December 31, 2018. The Company believes that its allowance for doubtful accounts was adequate at December 31, 2018. Please refer to Note R, “Segment Information,” for further information.

Cash and Cash Equivalents

The Company considers all highly liquid investments with original maturities of three months or less at the date of purchase to be cash equivalents.

Marketable Securities

As of December 31, 2018, the Company’s marketable securities consisted of investments in available-for-sale debt securities, including U.S. Treasury securities, government-sponsored enterprise securities, corporate debt securities and commercial paper, and corporate equity securities with readily determinable fair values. The Company classifies marketable securities available to fund current operations as current assets on its consolidated balance sheets. Marketable securities are classified as long-term assets on the consolidated balance sheets if (i) they have been in an unrealized loss position for longer than one year and (ii) the Company has the ability and intent to hold them (a) until the carrying value is recovered and (b) such holding period may be longer than one year. The Company’s marketable securities are stated at fair value. The fair value of these securities is based on quoted prices for identical or similar assets.

The Company records unrealized gains (losses) on available-for-sale debt securities as a component of “Accumulated other comprehensive income (loss),” which is a separate component of shareholders’ equity on its consolidated balance sheet, until such gains and losses are realized.

Pursuant to the adoption of Accounting Standards Update (“ASU”) No. 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities (“ASU 2016-01”) on January 1, 2018, the Company began recording changes in the fair value of its investments in corporate equity securities to “Other (expense) income, net” in the Company’s consolidated statements of operations. Prior to its adoption of ASU 2016-01 in 2018, the Company recorded changes in the fair value of its investments in corporate equity securities to “Accumulated other comprehensive income (loss).”

The Company reviews investments in marketable debt securities for other-than-temporary impairment whenever the fair value of an investment is less than the amortized cost and evidence indicates that an investment’s carrying amount is not recoverable within a reasonable period of time. To determine whether an impairment is other-than-temporary, the Company considers whether it has an intent to sell, or whether it is more likely than not that the Company will be required to sell, the investment before recovery of the investment’s amortized cost basis. Evidence considered in this assessment includes reasons for the impairment, compliance with the Company’s investment policy, the severity and the duration of the impairment and changes in value subsequent to year-end. If a decline in the fair value is considered other-than-temporary, based on available evidence, the unrealized loss is transferred from other comprehensive income (loss) to the consolidated statements of operations.

Realized gains and losses are determined using the specific identification method and are included in “Other (expense) income, net” in the consolidated statements of operations.

Accounts Receivable

The Company deducts invoice discounts for prompt payment and fees for distribution services from its accounts receivable based on its experience that the Company’s Customers will earn these discounts and fees. The Company’s estimates for its allowance for doubtful accounts, which have not been significant to date, are determined based on existing contractual payment terms and historical payment patterns.

Stock-based Compensation Expense

The Company expenses the fair value of employee stock options and other forms of stock-based employee compensation over the associated employee service period on a straight-line basis. Stock-based compensation expense is determined based on the fair value of the award at the grant date and is adjusted each period to reflect actual forfeitures and the outcomes of certain performance conditions.

For awards with performance conditions in which the award does not vest unless the performance condition is met, the Company recognizes expense if, and to the extent that, the Company estimates that achievement of the performance condition is probable. If the Company concludes that vesting is probable, it recognizes expense from the date it reaches this conclusion through the estimated vesting date. For awards with performance conditions that accelerate vesting of the award, the Company estimates the likelihood of satisfaction of the performance conditions, which affects the period over which the expense is recognized, and recognizes the expense using the accelerated attribution model.

The Company provides to employees who have rendered a certain number of years’ to the Company and meet certain age requirements, partial or full acceleration of vesting of these equity awards, subject to certain conditions including a notification period, upon a termination of employment other than for cause. Less than 5% of the Company’s employees were eligible for partial or full acceleration of any of their equity awards as of December 31, 2018. The Company recognizes stock-based compensation expense related to these awards over a service period reflecting qualified employees’ eligibility for partial or full acceleration of vesting.

Research and Development Expenses

The Company expenses as incurred all research and development expenses, including amounts funded by research and development collaborations. The Company capitalizes nonrefundable advance payments made by the Company for research and development activities and expenses the payments as the related goods are delivered or the related services are performed.

Research and development expenses are comprised of costs incurred by the Company in performing research and development activities, including salary and benefits; stock-based compensation expense; laboratory supplies and other direct expenses; outsourced services, including clinical trial and pharmaceutical development costs; collaboration and asset acquisition payments; expenses associated with drug supplies that are not being capitalized; and infrastructure costs, including facilities costs and depreciation expense.

Advertising Expenses

The Company expenses the costs of advertising, including promotional expenses, as incurred. Advertising expenses, recorded in sales, general and administrative expenses, were $43.5 million, $35.2 million and $31.4 million in 2018, 2017 and 2016, respectively.

Inventories

The Company values its inventories at the lower-of-cost or net realizable value. The Company determines the cost of its inventories, which includes amounts related to materials and manufacturing overhead, on a first-in, first-out basis. The Company performs an assessment of the recoverability of capitalized inventory during each reporting period, and writes down any excess and obsolete inventories to their net realizable value in the period in which the impairment is first identified. Shipping and handling costs incurred for inventory purchases are capitalized and recorded upon sale in “Cost of sales” in the consolidated statements of operations. Shipping and handling costs incurred for product shipments are recorded as incurred in “Cost of sales” in the consolidated statements of operations.

The Company capitalizes inventories produced in preparation for initiating sales of a drug candidate when the related drug candidate is considered to have a high likelihood of regulatory approval and the related costs are expected to be recoverable through sales of the inventories. In determining whether or not to capitalize such inventories, the Company evaluates, among other factors, information regarding the drug candidate’s safety and efficacy, the status of regulatory submissions and communications with regulatory authorities and the outlook for commercial sales, including the existence of current or anticipated competitive drugs and the availability of reimbursement. In addition, the Company evaluates risks associated with manufacturing the drug candidate and the remaining shelf-life of the inventories.

Property and Equipment

Property and equipment are recorded at cost. Depreciation expense is recorded using the straight-line method over the estimated useful life of the related asset, generally seven to ten years for furniture and equipment, three to five years for computers and software, 40 years for buildings and for leasehold improvements, the shorter of the useful life of the improvements or the estimated remaining life of the associated lease. Amortization expense of assets acquired under capital leases is included in depreciation expense. Maintenance and repairs to an asset that do not improve or extend its life are charged to operations. When assets are retired or otherwise disposed of, the assets and related accumulated depreciation are eliminated from the accounts and any resulting gain or loss is reflected in the Company’s consolidated statements of operations. The Company performs an assessment of the fair value of the assets if indicators of impairment are identified during a reporting period and records the assets at the lower of the net book value or the fair value of the assets.

The Company capitalizes internal costs incurred to develop software for internal use during the application development stage. Amortization of capitalized internally developed software costs is recorded in depreciation expense over the useful life of the related asset. The Company records certain construction costs incurred by a landlord as an asset and a corresponding financing obligation on the Company’s consolidated balance sheets when the Company is determined to be the owner of a building during construction for accounting purposes. Upon completion of the project, the Company performs a sale-leaseback analysis to determine if the Company can remove the assets and corresponding liability from its consolidated balance sheet.

Capital Leases

The assets and liabilities associated with capital lease agreements are recorded at the present value of the minimum lease payments at the inception of the lease agreement. The assets are depreciated using the straight-line method over the shorter of the useful life of the related asset or the remaining life of the associated lease. Amortization of assets that the Company leases pursuant to a capital lease is included in depreciation expense. The Company performs an assessment of the fair value of the assets if indicators of impairment are identified during a reporting period and records the assets at the lower of the net book value or the fair value of the assets. Assets recorded under capital leases are recorded in “Property and equipment, net” and liabilities related to those assets are recorded in “Capital lease obligations, current portion” and “Capital lease obligations, excluding current portion” on the Company’s consolidated balance sheets.

Income Taxes

Deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial statement carrying amounts and the income tax bases of assets and liabilities. A valuation allowance is applied against any net deferred tax asset if, based on the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. On a periodic basis, the Company reassesses the valuation allowance on its deferred income tax assets weighing positive and negative evidence to assess the recoverability of its deferred tax assets. The Company includes, among other things, its recent financial performance and its future projections in this periodic assessment.

The Company records liabilities related to uncertain tax positions by prescribing a minimum recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. The Company does not believe any such uncertain tax positions currently pending will have a material adverse effect on its consolidated financial statements.

Variable Interest Entities

The Company reviews each collaboration agreement pursuant to which it licenses assets owned by a collaborator in order to determine whether or not it has a variable interest via the license agreement with the collaborator and if the variable interest is a variable interest in the collaborator as a whole. In assessing whether the Company has a variable interest in the collaborator as a whole, the Company considers and makes judgments regarding the purpose and design of the entity, the value of the licensed assets to the collaborator, the value of the collaborator’s total assets and the significant activities of the collaborator. If the Company has a variable interest in the collaborator as a whole, the Company assesses whether or not the Company is the primary beneficiary of that VIE based on a number of factors, including (i) which party has the power to direct the activities that most significantly affect the VIE’s economic performance, (ii) the parties’ contractual rights and responsibilities pursuant to the collaboration agreement and (iii) which party has the obligation to absorb losses of or the right to receive benefits from the VIE that could be significant to the VIE. If the Company determines it is the primary beneficiary of a VIE at the onset of the collaboration agreement, the collaboration is treated as a business combination and the Company consolidates the financial statements of the VIE into the Company’s consolidated financial statements. On a quarterly basis, the Company evaluates whether it continues to be the primary beneficiary of any consolidated VIEs. If the Company determines that it is no longer the primary beneficiary of a consolidated VIE, or no longer has a variable interest in the VIE, it deconsolidates the VIE in the period that the determination is made.

Assets and liabilities recorded as a result of consolidating VIEs’ financial results into the Company’s consolidated balance sheet do not represent additional assets that could be used to satisfy claims against the Company’s general assets or liabilities for which creditors have recourse to the Company’s general assets.

Fair Value of In-process Research and Development Assets and Contingent Payments

The present-value models the Company uses to estimate the fair values of in-process research and development assets and contingent payments pursuant to collaborations incorporate significant assumptions.

The Company’s discounted cash flow models pertaining to in-process research and development assets include: (i) assumptions regarding the probability of obtaining marketing approval or a drug candidate; (ii) estimates regarding the timing of and the expected costs to develop and commercialize a drug candidate; (iii) estimates of future cash flows from potential product sales with respect to a drug candidate; and (iv) appropriate discount and tax rates.

The Company bases its estimates of the probability of achieving the milestones relevant to the fair value of contingent payments, which could include milestone, royalty and option payments, on industry data for similar assets and its own experience. Estimates included in the discounted cash flow models pertaining to contingent payments also include: (i) estimate regarding the timing of the relevant development and commercial milestones and royalties, (ii) and appropriate discount rates. The discount rates used in the valuation model for contingent payments represent a measure of credit risk and market risk associated with settling the liabilities. Significant judgment is used in determining the appropriateness of these assumptions at each reporting period. As of December 31, 2018, the Company does not have any in-process research and development assets recorded on its consolidated balance sheet and the fair value of contingent payments pursuant to its collaborations is zero due to the deconsolidation of BioAxone.

In-process Research and Development Assets

The Company records the fair value of in-process research and development assets as of the transaction date of a business combination. Each of these assets is accounted for as an indefinite-lived intangible asset and is maintained on the Company’s consolidated balance sheet until either the project underlying it is completed or the asset becomes impaired. If the asset becomes impaired or is abandoned, the carrying value of the related intangible asset is written down to its fair value, and an impairment charge is recorded in the period in which the impairment occurs. If a project is completed, the carrying value of the related intangible asset is amortized as a part of “Cost of sales” over the remaining estimated life of the asset beginning in the period in which the project is completed. In-process research and development assets are tested for impairment on an annual basis as of October 1, and more frequently if indicators are present or changes in circumstances suggest that impairment may exist.

In-process research and development assets that are acquired in a transaction that does not qualify as a business combination under GAAP and that do not have an alternative future use are expensed in the period in which the assets are acquired.

Goodwill

The difference between the purchase price and the fair value of assets acquired and liabilities assumed in a business combination is allocated to goodwill. Goodwill is evaluated for impairment on an annual basis as of October 1, and more frequently if indicators are present or changes in circumstances suggest that impairment may exist.

Noncontrolling Interest

The Company records “Noncontrolling interest,” which has historically related to consolidated VIEs, on its consolidated balance sheets. The Company records “Loss (income) attributable to noncontrolling interest” on its consolidated statements of operations, reflecting the VIEs’ net loss (income) for the reporting period, adjusted for changes in the noncontrolling interest holders’ claim to net assets, including contingent milestone, royalty and option payments, each of which is evaluated each reporting period.

Deconsolidation and Discontinued Operations

Upon the occurrence of certain events and on a regular basis, the Company evaluates whether it no longer has a controlling interest in its subsidiaries, including consolidated VIEs. If the Company determines it no longer has a controlling interest, the subsidiary is deconsolidated. The Company records a gain or loss on deconsolidation based on the difference on the deconsolidation date between (i) the aggregate of (a) the fair value of any consideration received, (b) the fair value of any retained noncontrolling investment in the former subsidiary and (c) the carrying amount of any noncontrolling interest in the subsidiary being deconsolidated, less (ii) the carrying amount of the former subsidiary’s assets and liabilities.

The Company assesses whether a deconsolidation is required to be presented as discontinued operations in its consolidated financial statements on the deconsolidation date. This assessment is based on whether or not the deconsolidation represents a strategic shift that has or will have a major effect on the Company’s operations or financial results. If the Company determines that a deconsolidation requires presentation as a discontinued operation on the deconsolidation date, or at any point during the one year period following such date, it will present the former subsidiary as a discontinued operation in current and comparative period financial statements.

Derivative Instruments and Embedded Derivatives

The Company has entered into financial transactions involving free-standing derivative instruments and embedded derivatives in the past. Embedded derivatives are required to be bifurcated from the host instruments if the derivatives are not clearly and closely related to the host instruments. The Company determines the fair value of each derivative instrument or embedded derivative that is identified on the date of issuance and at the end of each quarterly period. The estimates of the fair value of the derivatives include significant assumptions regarding the estimates market participants would make in order to evaluate these derivatives.

Hedging Activities

The Company recognizes the fair value of hedging instruments that are designated and qualify as hedging instruments pursuant to GAAP, foreign currency forward contracts, as either assets or liabilities on the consolidated balance sheets. Changes in the fair value of these instruments are recorded each period in “Accumulated other comprehensive income (loss)” as unrealized gains and losses until the forecasted underlying transaction occurs. Unrealized gains and losses on these foreign currency forward contracts are included in “Prepaid expenses and other current assets” or “Other assets,” and “Other liabilities, current portion” or “Other liabilities, excluding current portion,” respectively, on the Company’s consolidated balance sheets depending on the remaining period until their contractual maturity. Realized gains and losses for the effective portion of such contracts are recognized in “Product revenues, net” in the consolidated statement of operations in the same period that it recognizes the product revenues that were impacted by the hedged foreign exchange rate changes. The Company classifies the cash flows from hedging instruments in the same category as the cash flows from the hedged items.

Certain of the Company’s hedging instruments are subject to master netting arrangements to reduce the risk arising from such transactions with its counterparties. The Company presents unrealized gains and losses on its foreign currency forward contracts on a gross basis within its consolidated balance sheets.

The Company assesses, both at inception and on an ongoing basis, whether the foreign currency forward contracts used in hedging transactions are highly effective in offsetting the changes in cash flows of the hedged items. The Company also assesses hedge ineffectiveness quarterly and, if determined to be ineffective, records the gain or loss related to the ineffective portion to earnings in “Other (expense) income, net” in its consolidated statements of operations. The Company did not record any ineffectiveness related to these hedging transactions in the three years ended December 31, 2018.

The Company also enters into foreign currency forward contracts with contractual maturities of less than one month designed to mitigate the effect of changes in foreign exchange rates on monetary assets and liabilities including intercompany balances. These contracts are not designated as hedging instruments pursuant to GAAP. Realized gains and losses for such contracts are recognized in “Other (expense) income, net” in the consolidated statement of operations each period.

Restructuring Expenses

The Company records costs and liabilities associated with exit and disposal activities based on estimates of fair value in the period the liabilities are incurred. The Company’s exit and disposal activities have primarily been associated with the Company’s facilities, but also have included the termination of employees in some cases. The Company’s initial estimate of its liabilities for net ongoing costs associated with its facility obligations are recorded at fair value on the cease use date. On a quarterly basis, the Company evaluates and adjusts these liabilities as appropriate for changes in circumstances. Changes to the Company’s estimate of these liabilities are recorded as additional restructuring expenses (credits). These costs are included in “Restructuring (income) expenses” on the Company’s consolidated statements of operations.

The Company has adopted several plans to restructure its facilities and operations for which it has incurred restructuring expenses. The most significant restructuring event during the three years ended December 31, 2018 commenced in February 2017 upon the Company’s decision to consolidate its research activities into its Boston, Milton Park and San Diego locations. The Company closed its research site in Canada as a result of this decision affecting approximately 70 positions. The Company’s lease for its research site in Canada expired in October 2018. As of December 31, 2018, the Company has no restructuring liabilities recorded on its consolidated balance sheet and does not anticipate any additional charges related to this restructuring event in the future.

Comprehensive Income (Loss)

Comprehensive income (loss) consists of net income (loss) and other comprehensive income (loss), which includes foreign currency translation adjustments and unrealized gains and losses on foreign currency forward contracts and certain marketable securities. For purposes of comprehensive income (loss) disclosures, the Company records provisions for or benefits from income taxes related to the unrealized gains and losses on foreign currency forward contracts and certain marketable securities. The Company does not record provisions for or benefits from income taxes related to the cumulative translation adjustment, as the Company intends to permanently reinvest undistributed earnings in its foreign subsidiaries.

Foreign Currency Translation and Transactions

The majority of the Company’s operations occur in entities that have the U.S. dollar denominated as their functional currency. Non-U.S. dollar denominated functional currency subsidiaries have assets and liabilities translated into U.S. dollars at rates of exchange in effect at the end of the year. Revenue and expense amounts are translated using the average exchange rates for the period. Net unrealized gains and losses resulting from foreign currency translation are included in “Accumulated other comprehensive income (loss).” Net foreign currency exchange transaction gains or losses are included in “Other (expense) income, net” on the Company’s consolidated statement of operations. Net transaction losses were $1.1 million and $5.5 million for 2018 and 2017, respectively, and net transaction gains were $4.0 million for 2016. These net foreign currency exchange gains or losses are presented net of the impact of the foreign currency forward contracts designed to mitigate their effect on the Company’s consolidated statement of operations.

Net Loss Per Share Attributable to Vertex Common Shareholders

Basic and diluted net loss per share attributable to Vertex common shareholders are presented in conformity with the two-class method required for participating securities. Under the two-class method, earnings are allocated to (i) Vertex common shares, excluding unvested restricted stock, and (ii) participating securities, based on their respective weighted-average shares outstanding for the period. Shares of unvested restricted stock granted under the Company’s Amended and Restated 2006 Stock and Option Plan have the non-forfeitable right to receive dividends on an equal basis with other outstanding common stock. As a result, these unvested shares of restricted stock are considered participating securities under the two-class method. Potentially dilutive shares result from the assumed exercise of outstanding stock options (the proceeds of which are then assumed to have been used to repurchase outstanding stock using the treasury stock method).

Basic net loss per share attributable to Vertex common shareholders is based upon the weighted-average number of common shares outstanding during the period, excluding restricted stock that has been issued but is not yet vested. Diluted net loss per share attributable to Vertex common shareholders is based upon the weighted-average number of common shares outstanding during the period plus additional weighted-average common equivalent shares outstanding during the period when the effect is dilutive.

Recently Adopted Accounting Pronouncements

Revenue Recognition

In 2014, the Financial Accounting Standards Board (“FASB”) issued ASC 606. The new guidance became effective January 1, 2018. ASC 606 applies a more principles-based approach to recognizing revenue. Under ASC 606, revenue is recognized when a customer obtains control of promised goods or services in an amount that reflects the consideration that an entity expects to receive in exchange for those goods or services. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The Company adopted ASC 606 on January 1, 2018 using the modified-retrospective adoption method for all contracts that were not completed as of the date of adoption. Under the modified-retrospective method, the Company recognized the cumulative effect of applying the standard within “Accumulated deficit” on its consolidated balance sheet as of January 1, 2018.

For all reporting periods, the Company has not disclosed the value of unsatisfied performance obligations for all product revenue contracts with an original expected length of one year or less, which is an optional exemption that is permitted under the adoption rules.

Based on the Company’s review of existing customer contracts as of January 1, 2018, it concluded that the only significant impact that the adoption of ASC 606 had on its financial statements relates to shipments of ORKAMBI under early access programs in France. Prior to the adoption of ASC 606, the Company did not recognize revenue on the proceeds received from sales of ORKAMBI under early access programs in France because the price was not fixed or determinable based on the status of ongoing pricing discussions. As of January 1, 2018, the Company recorded a cumulative effect adjustment to its accumulated deficit of $8.3 million related to the adoption of ASC 606, which primarily represented the Company’s estimated amount of consideration it expects to retain related to these shipments that will not be subject to a significant reversal in amounts recognized, net of costs previously deferred related to these shipments. Please refer to “Product Revenues, Net” above for further information related to the impact of the new revenue recognition on these sales.

The Company concluded that the remaining $6.9 million that was recorded as deferred revenues as of December 31, 2017 related to the Company’s 2008 sale of its HIV protease inhibitor royalty stream is not subject to ASC 606 because it was initially accounted for pursuant to ASC 470, Debt, which is not under the scope of ASC 606. The Company has continued to recognize the payment received as royalty revenues over the expected life of the collaboration agreement with GlaxoSmithKline plc based on the units-of-revenue method.

The cumulative effect of applying ASC 606 to the Company’s contracts with customers that were not completed as of January 1, 2018 was as follows:



	Balance as of						Balance as of
	December 31, 2017			Adjustments			January 1, 2018
Assets	(in thousands)
Accounts receivable, net	$	281,343		$	29,881		$	311,224
Inventories	111,830			(90		)	111,740
Prepaid expenses and other current assets	167,124			(17,166		)	149,958
Total assets	$	3,546,014		$	12,625		$	3,558,639
Liabilities and Shareholders’ Equity
Accrued expenses	$	443,961		$	8,586		$	452,547
Early access sales accrual	232,401			(7,273		)	225,128
Other liabilities, current portion	34,373			2,083			36,456
Accumulated other comprehensive income (loss)	(11,572		)	949			(10,623		)
Accumulated deficit	(5,119,723		)	8,280			(5,111,443		)
Total liabilities and shareholders’ equity	$	3,546,014		$	12,625		$	3,558,639

The impact of adoption on the Company’s consolidated balance sheet as of December 31, 2018 was as follows:



	As of December 31, 2018
	As Reported under ASC 606			Balances without Adoption of ASC 606			Effect of Change Higher/(Lower)
Assets	(in thousands)
Accounts receivable, net	$	409,688		$	376,949		$	32,739
Inventories	124,360			124,506			(146		)
Prepaid expenses and other current assets	140,819			167,522			(26,703		)
Total assets	$	6,245,898		$	6,240,008		$	5,890
Liabilities and Shareholders’ Equity
Accrued expenses	$	604,495		$	618,873		$	(14,378	)
Early access sales accrual	354,404			380,609			(26,205		)
Other liabilities, current portion	40,589			14,355			26,234
Accumulated other comprehensive income (loss)	659			927			(268		)
Accumulated deficit	(2,989,478		)	(3,009,985		)	20,507
Total liabilities and shareholders’ equity	$	6,245,898		$	6,240,008		$	5,890

The impact of adoption on the Company’s consolidated statement of operations for the year ended December 31, 2018 was as follows:



	Year Ended December 31, 2018
	As Reported under ASC 606		Balances without Adoption of ASC 606		Effect of Change Higher/(Lower)
	(in thousands)
Product revenues, net	$	3,038,325	$	3,019,484	$	18,841
Cost of sales	409,539		402,925		6,614
Income from operations	635,150		622,923		12,227
Net income attributable to Vertex	$	2,096,896	$	2,084,669	$	12,227

Amounts per share attributable to Vertex common shareholders:
Net income:
Basic	$	8.24	$	8.20	$	0.04
Diluted	$	8.09	$	8.04	$	0.05

ASC 606 did not have an aggregate impact on the Company’s net cash provided by operating activities, but resulted in offsetting changes in certain assets and liabilities presented within net cash provided by operating activities in the Company’s consolidated statement of cash flows.

Equity Investments

In 2016, the FASB issued ASU 2016-01, which amended guidance related to the recording of financial assets and financial liabilities. Under ASU 2016-01, equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of an investee) are measured at fair value with changes in fair value recognized in net income (loss). However, an entity has the option to measure equity investments without readily determinable fair values at (i) fair value or (ii) cost adjusted for changes in observable prices minus impairment. Changes in measurement under either alternative are recognized in net income (loss). ASU 2016-01 became effective January 1, 2018 and required the modified-retrospective adoption method. As of January 1, 2018, the Company held publicly traded equity investments and equity investments accounted for under the cost method. As a result, in 2018, the Company recorded a $25.1 million cumulative effect adjustment to “Accumulated deficit” related to its publicly traded equity investments equal to the unrealized gain, net of tax, that was recorded in “Accumulated other comprehensive income (loss)” as of December 31, 2017. The adoption of ASU 2016-01 had no effect on the Company’s equity investments accounted for under the cost method because the original cost basis of these investments was recorded on the Company’s consolidated balance sheet as of December 31, 2017. The Company recorded net unrealized gains of $2.6 million to “Other (expense) income, net” in its consolidated statement of operations related to the change in fair value of its equity investments in the year ended December 31, 2018.

Intra-Entity Transfers

In 2016, the FASB issued ASU No. 2016-16, Intra-Entity Transfers of Assets Other Than Inventory (“ASU 2016-16”), which removes the previous exception in GAAP prohibiting an entity from recognizing current and deferred income tax expenses or benefits related to the transfer of assets, other than inventory, within the consolidated entity. The exception to defer the recognition of any tax impact on the transfer of inventory within the consolidated entity until it is sold to a third party remains unaffected. ASU 2016-16 became effective January 1, 2018. In 2018, upon adoption of ASU 2016-16, the Company recorded a deferred tax asset and corresponding full valuation allowance of $204.7 million equal to the unamortized cost of intellectual property rights transferred to the United Kingdom in 2014 multiplied by an appropriate statutory rate. There was no cumulative effect adjustment to “Accumulated deficit” using the modified-retrospective adoption method.

Goodwill

In 2017, the FASB issued ASU No. 2017-04, Intangibles - Goodwill and Other (Topic 350) (“ASU 2017-04”) related to measurements of goodwill. ASU 2017-04 modifies the concept of impairment from the condition that exists when the carrying amount of goodwill exceeds its implied fair value to the condition that exists when the carrying amount of a reporting unit exceeds its fair value, which eliminates Step 2 from the goodwill impairment test. An entity would recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to the related reporting unit. The Company early adopted ASU 2017-04 and utilized this approach for annual and interim goodwill impairment tests conducted after January 1, 2018. The adoption of ASU 2017-04 did not have a significant effect on the Company’s consolidated financial statements.

Stock-Based Compensation - Modifications

In 2017, the FASB issued ASU No. 2017-09, Compensation - Stock Compensation (Topic 718) (“ASU 2017-09”) related to the scope of stock option modification accounting, to reduce diversity in practice and provide clarity regarding existing guidance. ASU 2017-09 became effective January 1, 2018. The Company does not expect the adoption of ASU 2017-09 to have a significant effect on its consolidated financial statements in future periods and had no effect in the year ended December 31, 2018.

Cash Flows - Restricted Cash

In 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230) Restricted Cash (“ASU 2016-18”), which requires that a statement of cash flows explain the change during the period in the total of cash, cash equivalents and restricted cash. Therefore, amounts described as restricted cash should be included with cash and cash equivalents when reconciling the beginning of period and end of period amounts shown on the statement of cash flows. ASU 2016-18 became effective January 1, 2018 and is effective on a retrospective basis. The cash, cash equivalents and restricted cash balances for the years ended December 31, 2018 through 2015, which are presented in the Company’s consolidated statements of cash flows subsequent to the adoption of ASU 2016-18, consisted of the following:



	As of December 31,
	2018		2017		2016		2015
	(in thousands)
Cash and cash equivalents	$	2,650,134	$	1,665,412	$	1,183,945	$	714,768
Prepaid expenses and other current assets	4,910		2,114		47,762		78,910
Other assets	3,209		—		—		22,083
Cash, cash equivalents and restricted cash per statement of cash flows	$	2,658,253	$	1,667,526	$	1,231,707	$	815,761

The Company’s restricted cash is included in “Prepaid expenses and other current assets” and “Other assets,” if any, in its consolidated balance sheets. As of December 31, 2017, the Company recorded its VIE’s cash and cash equivalents, which were not material to the Company’s financial statements, as “Prepaid expenses and other current assets” because (i) the Company did not have any interest in or control over BioAxone’s cash and cash equivalents and (ii) the Company’s agreement with BioAxone did not provide for BioAxone’s cash and cash equivalents to be used for the development of the asset that the Company licensed from BioAxone. As of December 31, 2018, the Company does not have any consolidated VIEs.

Stock-Based Compensation - Improvements

In 2016, the FASB issued ASU No. 2016-09, Compensation—Stock Compensation (Topic 718) Improvements to Employee Share-Based Payment Accounting (“ASU 2016-09”), which simplifies the accounting for employee share-based payment transactions, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in the statement of cash flows. ASU 2016-09 became effective January 1, 2017. ASU 2016-09 eliminated the requirement that excess tax benefits were realized as a reduction in current taxes payable before the associated tax benefit could be recognized as an increase in additional paid-in capital. This created a deferred tax asset (“DTA”) of $410.8 million relating to federal and state net operating losses (“NOLs”) that were fully reserved by an equal increase in the Company’s valuation allowance as of January 1, 2017. The Company recorded DTAs of $404.7 million relating to federal NOLs and $6.1 million relating to state NOLs, both of which were offset by a full valuation allowance. Upon adoption, the Company also elected to change its accounting policy to account for forfeitures of options and awards as they occur. The change was applied on a modified-retrospective basis with a cumulative effect adjustment to increase “Accumulated deficit” by $9.4 million as of January 1, 2017. This change also resulted in an increase to the DTA of $3.4 million, which was offset by a full valuation allowance. As a result, there was no cumulative effect adjustment to accumulated deficit related to income taxes. The provisions related to the recognition of excess tax benefits in the Company’s consolidated statement of operations and classification in the consolidated statement of cash flows were adopted prospectively, and as such, the prior periods were not retrospectively adjusted.

Recently Issued Accounting Standards

Leases

In 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) (“ASC 842”), which amends a number of aspects of lease accounting and requires entities to recognize right-of-use assets and liabilities on the balance sheet for leases with lease terms of more than 12 months. ASC 842 is effective on January 1, 2019. The Company’s project team has substantially completed its review of its portfolio of existing leases and current accounting policies to identify and assess the potential differences that would result from applying the requirements of the new standard. The Company is also in the process of finalizing appropriate changes to its controls to support lease accounting and related disclosures under the new standard.

As discussed in Note L, “Long-term Obligations,” the Company currently applies build-to-suit accounting and is the deemed owner of its leased corporate headquarters in Boston and research site in San Diego, for which it is recognizing depreciation expense over the buildings’ useful lives and imputed interest on the corresponding construction financing lease obligations. Under ASC 842, the Company will account for these buildings as financing leases, resulting in increased depreciation expense over the respective lease terms, which are significantly shorter than the buildings’ useful lives. The Company also expects a reduction in its imputed interest expense in the initial years of each financing lease term. In 2019, the Company expects an increase in operating expenses of approximately $26 million and a decrease in interest expense of approximately $13 million due to this change.

In July 2018, the FASB issued ASU No. 2018-11, Leases (Topic 842): Targeted Improvements (“ASU 2018-11”), which offers a transition option to entities adopting ASC 842. Under ASU 2018-11 entities can elect to apply ASC 842 using a modified-retrospective adoption approach resulting in a cumulative effect adjustment to accumulated deficit at the beginning of the year in which the new lease standard is adopted, rather than adjustments to the earliest comparative period presented in their financial statements. The Company will adopt ASC 842 using the modified-retrospective method. In the first quarter of 2019, the Company expects to record a cumulative effect adjustment to increase its “Accumulated deficit” by approximately $50 million related to the adjustments to its build-to-suit leases described in the previous paragraph.

Additionally, the Company expects to record, upon adoption of ASC 842 on January 1, 2019, right-of-use assets of approximately $60 million and corresponding liabilities of approximately $70 million related to its real estate leases with terms of more than 12 months that are not treated as financing leases under ASC 842. The difference between these assets and liabilities will be primarily attributable to prepaid or accrued lease payments. The Company also anticipates reclassifying amounts recorded as “Capital lease obligations, current portion” and “Capital lease obligations, excluding current portion” as financing lease obligations on January 1, 2019. These adjustments will have no impact on the Company’s consolidated statement of operations and no impact on the Company’s accumulated deficit.

Derivatives and Hedging

In 2017, the FASB issued ASU No. 2017-12, Derivatives and Hedging (Topic 815) (“ASU 2017-12”), which helps simplify certain aspects of hedge accounting and enables entities to more accurately present their risk management activities in their financial statements. ASU 2017-12 is effective on January 1, 2019. The Company does not expect the adoption of ASU 2017-12 to have a significant effect on its consolidated financial statements.

Internal-Use Software

In 2018, the FASB issued ASU No. 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 (“ASU 2018-15”), which clarifies the accounting for implementation costs in cloud computing arrangements. ASU 2018-15 is effective on January 1, 2020. Early adoption is permitted. The Company currently is evaluating the impact the adoption of ASU 2018-15 may have on its consolidated financial statements.

Fair Value Measurement

In 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement (“ASU 2018-13”), which modifies the disclosure requirements for fair value measurements. ASU 2018-13 is effective on January 1, 2020. Early adoption is permitted. The Company currently is evaluating the impact the adoption of ASU 2018-13 may have on its disclosures.

Collaborative Arrangements

12 Months Ended

Dec. 31, 2018

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Collaborative Arrangements

Collaborative Arrangements and Acquisitions

The Company has entered into numerous agreements pursuant to which it collaborates with third parties on research, development and commercialization programs, including in-license and out-license agreements and asset acquisitions.

In-license Agreements

The Company has entered into a number of license agreements in order to advance and obtain access to technologies and services related to its research and early-development activities. The Company is generally required to make an upfront payment upon execution of the license agreement; development, regulatory and commercialization milestones payments upon the achievement of certain product research, development and commercialization objectives; and royalty payments on future sales, if any, of commercial products resulting from the collaboration.

Pursuant to the terms of its in-license agreements, the Company’s collaborators lead the discovery efforts and the Company leads all preclinical, development and commercialization activities associated with the advancement of any drug candidates and funds all expenses unless otherwise described below.

The Company typically can terminate its in-license agreements by providing advance notice to it collaborators; the required length of notice is dependent on whether any product developed under the license agreement has received marketing approval. The Company’s license agreements may be terminated by either party for a material breach by the other, subject to notice and cure provisions. Unless earlier terminated, these license agreements generally remain in effect until the date on which the royalty term and all payment obligations with respect to all products in all countries have expired.

CRISPR Therapeutics AG

In 2015, the Company entered into a strategic collaboration, option and license agreement (the “CRISPR Agreement”) with CRISPR Therapeutics AG and its affiliates (“CRISPR”) to collaborate on the discovery and development of potential new treatments aimed at the underlying genetic causes of human diseases using CRISPR-Cas9 gene editing technology. The Company has the exclusive right to license up to six CRISPR-Cas9-based targets, including targets for the potential treatment of sickle cell disease. In connection with the CRISPR Agreement, the Company made an upfront payment to CRISPR of $75.0 million and an investment in CRISPR’s stock. The Company has also made several subsequent investments in CRISPR’s common shares, which has resulted in CRISPR becoming a related party of the Company as of December 31, 2018. Please refer to Note E, “Marketable Securities and Equity Investments,” for further information regarding the Company’s investment in CRISPR’s common stock.

The Company funds all the discovery activities conducted pursuant to the CRISPR Agreement. For targets that the Company elects to license, other than hemoglobinopathy treatments, the Company would lead all development and global commercialization activities. For each target that the Company elects to license, other than hemoglobinopathy targets, CRISPR has the potential to receive up to $420.0 million in development, regulatory and commercial milestones as well as royalties on net product sales. As part of the collaboration, the Company and CRISPR share equally all development costs and potential worldwide revenues related to potential hemoglobinopathy treatments, including treatments for beta-thalassemia and sickle cell disease.

In 2017, the Company entered into a co-development and co-commercialization agreement with CRISPR pursuant to the terms of the CRISPR Agreement, under which the Company and CRISPR are co-developing and will co-commercialize CTX001 (the “CTX001 Co-Co Agreement”) for the treatment of hemoglobinopathy, including treatments for sickle cell disease and beta-thalassemia. The Company concluded that the CTX001 Co-Co Agreement is a cost-sharing arrangement, which results in the net impact of the arrangement being recorded in “Research and development expenses” in its consolidated statements of operations. During the year ended December 31, 2018, the net expense related to the CTX001 Co-Co Agreement was $19.7 million. Net expense related to the CTX001 Co-Co Agreement during the year ended December 31, 2017 was not significant.

Other In-License Agreements

In 2016, the Company entered into a strategic collaboration and licensing agreement with Moderna Therapeutics, Inc. (“Moderna”), pursuant to which the parties are seeking to identify and develop messenger ribonucleic acid, or mRNA, therapeutics for the treatment of CF. The Company made an upfront payment to Moderna of $20.0 million, which was recorded to “Research and development expenses” and an investment in Moderna’s preferred stock, which converted to common stock when Moderna became a publicly traded company in December 2018. Moderna has the potential to receive future development and regulatory milestones of up to $275.0 million as well as royalties on net product sales. Please refer to Note E, “Marketable Securities and Equity Investments,” for further information regarding the Company’s investment in Moderna’s common stock.

In December 2018, the Company entered into a strategic collaboration and licensing agreement (the “Arbor Agreement”) with Arbor Biotechnologies, Inc. (“Arbor”) focused on the discovery of novel proteins, including DNA endonucleases, to advance the development of new gene-editing therapies. Pursuant to the Arbor Agreement, Arbor’s platform technology is being applied in the collaboration activities for up to five Vertex disease areas in exchange for an upfront payment of $30.0 million. In addition, the Company received a convertible promissory note that matures in 2023 for an additional $15.0 million payment. For the each product identified by the collaboration, Arbor has the potential to receive up to $337.5 million in development, regulatory and commercial milestones as well as royalties on net product sales.

The Company determined that the fair value of the convertible promissory note approximated its contractual value upon agreement execution and is accounting for the convertible note at amortized cost. The Company determined that substantially all of the fair value of the Arbor Agreement was attributable to an in-process research and development asset and no substantive processes were acquired that would constitute a business. The Company concluded that it did not have any alternative future use for the acquired in-process research and development asset and recorded the $30.0 million upfront payment to “Research and development expenses.”

Variable Interest Entities (VIEs)

The Company has license agreements with Parion and BioAxone, pursuant to which the Company licensed rights to certain drug candidates from these third-party collaborators that resulted in the consolidation of the third-parties’ financial statements into the Company’s consolidated financial statements as VIEs for portions or all of the three years ended December 31, 2018. The Company deconsolidated the financial statements of Parion as of September 30, 2017 and BioAxone as of December 31, 2018 from its consolidated financial statements. Please refer to Note J, “Intangible Assets and Goodwill,” for further information regarding the impairment of Parion’s pulmonary ENaC platform and BioAxone’s VX-210 program that were related to these collaborations.

Parion Sciences, Inc.

In 2015, the Company entered into a strategic collaboration and license agreement (the “Parion Agreement”) with Parion to collaborate with Parion to develop investigational epithelial sodium channel (“ENaC”) inhibitors for the potential treatment of CF and all other pulmonary diseases. The Company is responsible for all costs, subject to certain exceptions, related to development and commercialization of the compounds.

Pursuant to the Parion Agreement, the Company has worldwide development and commercial rights to Parion’s lead investigational ENaC inhibitors, VX-371 and VX-551, for the potential treatment of CF and all other pulmonary diseases. To date Parion has received $85.0 million in upfront and milestone payments under the Parion Agreement. Parion has the potential to receive additional development and regulatory milestones related to the ENaC inhibitors for the potential treatment of CF and all other pulmonary diseases.

Following execution of the Parion Agreement, the Company determined that it had a variable interest in Parion via the Parion Agreement, and that the variable interest represented a variable interest in Parion as a whole because the fair value of the ENaC inhibitors represented more than half of the total fair value of Parion’s assets. The Company also concluded that it was the primary beneficiary as it had the power to direct the activities that most significantly affect the economic performance of Parion and that it had the obligation to absorb losses and right to receive benefits that potentially could be significant to Parion. Accordingly, the Company consolidated Parion's financial statements beginning in June 2015.

In the second quarter of 2017, Parion signed a license agreement with an affiliate of Shire plc related to the development of a drug candidate for the potential treatment of dry eye disease; however, the Company continued to consolidate Parion as a variable interest entity because it determined that there was no substantive change in the design of Parion subsequent to Parion’s agreement with Shire. Based on the consolidation of Parion’s financial statements, during the year ended December 31, 2017, the Company recognized $40.0 million of collaborative revenues and (ii) a tax provision of $14.8 million, both of which were attributable to noncontrolling interest related to payments that Parion received from Shire in the year ended December 31, 2017.

As of September 30, 2017, the Company determined that the fair value of Parion’s pulmonary ENaC platform had declined significantly based on data received in September 2017 from a Phase 2 clinical trial of VX-371 that did not meet its primary efficacy endpoint. After evaluating the results of the clinical trial and based on the decrease in the fair value of Parion’s pulmonary ENaC platform relative to Parion’s other activities, the Company determined that it was no longer the primary beneficiary of Parion as it no longer had the power to direct the significant activities of Parion. Accordingly, the Company deconsolidated Parion as of September 30, 2017. The impairment charge of $255.3 million, the decrease in the fair value of the contingent payments payable by the Company to Parion of $69.6 million and the benefit from income taxes of $126.2 million resulting from these charges were recorded in the third quarter of 2017 and were attributable to noncontrolling interest. The benefit from income taxes consisted of benefits of $97.7 million attributable to the impairment charge and $28.5 million attributable to the decrease in the fair value of contingent payments. The net effect of these charges and impact of the deconsolidation was a loss of $7.1 million recorded in “Other (expense) income, net” attributable to Vertex in the consolidated statement of operations for the year ended December 31, 2017. The loss of $7.1 million was approximately the difference between (i) the aggregate of $85.0 million in upfront and milestone payments that the Company made to Parion pursuant to the Parion Agreement and (ii) losses the Company recorded in 2015, 2016 and the first half of 2017 based on increases in the fair value of contingent payments payable by the Company to Parion.

BioAxone Biosciences, Inc.

In 2014, the Company entered into a license and collaboration agreement (the “BioAxone Agreement”) with BioAxone, which resulted in the consolidation of BioAxone as a VIE beginning in October 2014. The Company made an initial payment to BioAxone of $10.0 million in 2014. In the first quarter of 2018, an option held by the Company to purchase BioAxone expired and the Company paid a $10.0 million license continuation fee to BioAxone.

In October 2018, the Company announced it would stop clinical development of VX-210 and terminate the Phase 2b clinical trial of VX-210 based on the recommendation of the clinical trial’s Data Safety Monitoring Board and the Company’s review of interim data. In December 2018, the Company notified BioAxone of its intent to terminate the BioAxone Agreement and executed a release that immediately allowed BioAxone to control development of its neurological programs other than VX-210 without the Company’s consent. As a result, the Company deconsolidated BioAxone as of December 31, 2018 because it determined that it no longer was the primary beneficiary of BioAxone as it no longer had the power to direct the significant activities of BioAxone. The net impact of the deconsolidation was not material to the Company’s consolidated statement of operations.

The Company concluded that the deconsolidations of Parion and BioAxone, based on clinical data that did not meet expectations, were not developments that represented a significant strategic shift or had a material impact on the Company’s overall operations and financial results or its plans to focus on developing and commercializing therapies for the treatment of CF and advancing its research and development programs in additional diseases. Therefore, the Company did not present the results related to Parion and BioAxone as discontinued operations in its consolidated statements of operations for the three years ended December 31, 2018.

Aggregate VIE Financial Information

An aggregate summary of net loss attributable to noncontrolling interest related to the Company’s VIEs for the three years ended December 31, 2018 was as follows:



	2018			2017			2016
	(in thousands)
Loss attributable to noncontrolling interest before (benefit from) provision for income taxes and changes in fair value of contingent payments	$	31,191		$	223,379		$	10,086
(Benefit from) provision for income taxes	(3,668		)	(114,090		)	16,743
(Increase) decrease in fair value of contingent payments	(17,730		)	62,560			(54,850		)
Net loss (income) attributable to noncontrolling interest	$	9,793		$	171,849		$	(28,021	)

The increase in the noncontrolling interest holders’ claim to net assets with respect to the fair value of the contingent payments for the year ended December 31, 2018 was primarily due to the expiration of the Company’s option to purchase BioAxone that increased the probability of the $10.0 million license continuation fee for VX-210 that was paid in 2018. The decrease in the noncontrolling interest holders’ claim to net assets with respect to the fair value of the contingent payments for the year ended December 31, 2017 was primarily due to the decrease in the fair value of Parion’s pulmonary ENaC platform described above. The increase in the fair value of the contingent payments for the year ended December 31, 2016 was primarily due to a separate Phase 2 clinical trial of VX-371 achieving its primary safety endpoint in 2016. The fair value of the contingent payments payable by the Company to BioAxone was zero, due to the deconsolidation of BioAxone, and $18.9 million as of December 31, 2018 and 2017, respectively. During three years ended December 31, 2018, the (increases) decreases in the fair value of the contingent payments related to the Company’s VIEs were as follows:



	2018			2017			2016
	(in thousands)
Parion	$	—		$	63,460		$	(64,800	)
BioAxone	(17,730		)	(900		)	9,950

As of December 31, 2018, the Company did not have any consolidated VIEs. As of December 31, 2017, the Company’s consolidated balance sheet included the following significant amounts related to its consolidation of BioAxone as a VIE:



	December 31, 2017
	(in thousands)
Intangible assets	$	29,000
Deferred tax liabilities	4,756
Noncontrolling interest	13,727

Asset Acquisition

Concert Pharmaceuticals

In 2017, the Company acquired certain CF assets including VX-561 (the “Concert Assets”) from Concert Pharmaceuticals Inc. (“Concert”) pursuant to an asset purchase agreement (the “Concert Agreement”). VX-561 is an investigational CFTR potentiator that has the potential to be used as part of combination regimens of CFTR modulators to treat CF. Pursuant to the Concert Agreement, Vertex paid Concert $160.0 million in cash for the Concert Assets. If VX-561 is approved as part of a combination regimen to treat CF, Concert could receive up to an additional $90.0 million in milestones based on regulatory approval in the United States and reimbursement in the United Kingdom, Germany or France. The Company determined that substantially all of the fair value of the Concert Agreement was attributable to a single in-process research and development asset, VX-561, which did not constitute a business. The Company concluded that it did not have any alternative future use for the acquired in-process research and development asset. Thus, the Company recorded the $160.0 million upfront payment to “Research and development expenses” in 2017. The total cost of the transaction was $165.1 million including $5.1 million of transaction costs that were recorded to “Sales, general and administrative expenses.”

Out-license Agreements

The Company has entered into licensing agreements pursuant to which it has out-licensed rights to certain drug candidates to third-party collaborators. Pursuant to these out-license agreements, the Company’s collaborators become responsible for all costs related to the continued development of such drug candidates and obtain development and commercialization rights to these drug candidates. Depending on the terms of the agreements, the Company’s collaborators may be required to make upfront payments, milestone payments upon the achievement of certain product research and development objectives and may also be required to pay royalties on future sales, if any, of commercial products resulting from the collaboration. The termination provisions associated with these collaborations are generally the same as those described above related to the Company’s in-license agreements.

Merck KGaA, Darmstadt, Germany

In January 2017, the Company entered into a strategic collaboration and license agreement (the “Oncology Agreement”) with Merck KGaA, Darmstadt, Germany (the “Licensee”). Pursuant to the Oncology Agreement, the Company granted the Licensee an exclusive worldwide license to research, develop and commercialize four oncology research and development programs including two clinical-stage programs targeting DNA damage repair: its ataxia telangiectasia and Rad3-related protein kinase inhibitor program, or ATR program, including VX-970 and VX-803, and its DNA-dependent protein kinase inhibitor program, or DNA-PK program, including VX-984. In addition, the Company granted the Licensee exclusive, worldwide rights to two pre-clinical programs.

The Oncology Agreement provided for an upfront payment from the Licensee to the Company of $230.0 million. The Company evaluated the deliverables, primarily consisting of a license to the four programs and the obligation to complete certain fully-reimbursable research and development and transition activities as directed by the Licensee, pursuant to the Oncology Agreement, under the multiple element arrangement accounting guidance that was applicable in 2017. The Company concluded that the license had stand-alone value from the research and development and transition activities based on the resources and know-how possessed by the Licensee, and thus concluded that there are two units of accounting in the arrangement. The Company determined the relative selling price of the units of accounting based on the Company’s best estimate of selling price. The Company utilized key assumptions to determine the best estimate of selling price for the license, which included future potential net sales of licensed products, development timelines, reimbursement rates for personnel costs, discount rates, and estimated third-party development costs. The Company utilized a discounted cash flow model to determine its best estimate of selling price for the license and determined the best estimate of selling price for the research and development and transition activities based on what it would sell the services for separately. Given the significance of the best estimate of selling price for the license as compared to the best estimate of selling price for the research and development and transition services, reasonable changes in the assumptions used in the discounted cash flow model would not have a significant impact on the relative selling price allocation. Based on this analysis, the Company recognized the $230.0 million upfront payment upon delivery of the license as well as research and development and transition activities during the year ended December 31, 2017. The Company records the reimbursement for the research and development and transition activities in its consolidated statements of operations as collaborative revenue primarily due to the fact that it is the primary obligor in the arrangement. The Company’s activities related to the research and development and transition activities under the Oncology Agreement were substantially complete as of December 31, 2017.

In December 2018, the Company entered into an agreement with Merck KGaA, Darmstadt, Germany (the “DNA-PK Agreement”) whereby the Company licensed the two lead Vertex DNA-PK compounds from its DNA-PK program for use in the field of gene integration for six specific indications. In exchange for this exclusive worldwide license to research, develop and commercialize the DNA-PK program for the specified indications within the field of gene integration, the Company made an upfront payment of $65.0 million. Merck KGaA, Darmstadt, Germany has the potential to receive additional milestones, primarily related to approval and reimbursement in various markets, as well as royalties on net product sales.

The Company evaluated the DNA-PK Agreement and concluded it represents a modification of the Oncology Agreement pursuant to ASC 606. As of December 2018, when the Company entered into the DNA-PK Agreement, the Company had completed its obligations under the Oncology Agreement, but the Oncology Agreement was an open contract pursuant to ASC 606 since the Company could receive future royalty payments from the commercialization of the licensed programs under the Oncology Agreement.

In applying ASC 606, the Company determined that the license granted under the DNA-PK Agreement is distinct from the license granted by the Company under the Oncology Agreement since the license to the two lead Vertex DNA-PK compounds is capable of being distinct as the Company is able to benefit from the license via its ability to internally develop and commercialize the two lead Vertex DNA-PK compounds in the six named indications in the field of gene-editing, and the license is not dependent on Merck KGaA, Darmstadt, Germany providing any specialized services to the Company. In addition, the license to the two lead Vertex DNA-PK compounds granted to the Company under the DNA-PK Agreement is distinct from the license granted by the Company under the Oncology Agreement as the rights conveyed in the licenses differ and both parties have the ability to commercially benefit from the licenses on their own. Furthermore, the consideration attributable to the license of the two lead Vertex DNA-PK compounds represents fair value. Therefore, the Company determined it should account for the DNA-PK Agreement as a separate agreement.

The Company determined that substantially all of the fair value of the DNA-PK Agreement was attributable to a single in-process research and development asset that did not constitute a business. The Company concluded that it did not have any alternative future use for the acquired in-process research and development asset and recorded the $65.0 million payment to “Research and development expenses” accordingly.

Janssen Pharmaceuticals, Inc.

In 2014, the Company entered into an agreement with Janssen Pharmaceuticals, Inc. (“Janssen”). Pursuant to the agreement, Janssen has an exclusive worldwide license to develop and commercialize certain drug candidates for the treatment of influenza, including pimodivir. The Company received non-refundable payments of $35.0 million from Janssen in 2014 and recognized a $25.0 million milestone in 2017, based on a Phase 3 clinical trial Janssen initiated in 2017, that was collected in 2018.

Cystic Fibrosis Foundation

The Company has a research, development and commercialization agreement that was originally entered into in 2004 with Cystic Fibrosis Foundation (“CFF”), as successor in interest to the Cystic Fibrosis Foundation Therapeutics, Inc. This agreement was most recently amended in 2016 (the “2016 Amendment”). Pursuant to the agreement, as amended, the Company agreed to pay royalties ranging from low-single digits to mid-single digits on potential sales of certain compounds first synthesized and/or tested between March 1, 2014 and August 31, 2016, including VX-659 and VX-445, and tiered royalties ranging from single digits to sub-teens on any approved drugs first synthesized and/or tested during a research term on or before February 28, 2014, including KALYDECO (ivacaftor), ORKAMBI (lumacaftor in combination with ivacaftor) and SYMDEKO/SYMKEVI (tezacaftor in combination with ivacaftor). For combination products, such as ORKAMBI and SYMDEKO, sales are allocated equally to each of the active pharmaceutical ingredients in the combination product.

In 2016, CFF earned the last commercial milestone payment of $13.9 million payable by the Company pursuant to the agreement upon achievement of certain sales levels of lumacaftor. Pursuant to the 2016 Amendment, the Company received an upfront payment of $75.0 million and is receiving development funding from CFF of up to $6.0 million annually. The Company concluded that the upfront payment plus any future development funding represent a form of financing pursuant to ASC 730 and thus records the amounts as a liability on the consolidated balance sheet, primarily reflected in “Advance from collaborator, excluding current portion.” The Company reduces this liability over the estimated royalty term of the agreement and reflects the reductions as an offset to “Cost of sales” and as “Interest expense, net.”

The Company has royalty obligations to CFF for ivacaftor, lumacaftor and tezacaftor until the expiration of patents covering those compounds. The Company has patents in the United States and European Union covering the composition-of-matter of ivacaftor that expire in 2027 and 2025, respectively, subject to potential patent extension. The Company has patents in the United States and European Union covering the composition-of-matter of lumacaftor that expire in 2030 and 2026, respectively, subject to potential extension. The Company has patents in the United States and European Union covering the composition-of-matter of tezacaftor that expire in 2027 and 2028, respectively, subject to potential extension.

Earnings Per Share

12 Months Ended

Dec. 31, 2018

Earnings Per Share [Abstract]

Earnings Per Share

Basic net income (loss) per share attributable to Vertex common shareholders is based upon the weighted-average number of common shares outstanding during the period, excluding restricted stock, restricted stock units and performance-based restricted stock units, or PSUs, which have been issued but are not yet vested. Diluted net income (loss) per share attributable to Vertex common shareholders is based upon the weighted-average number of common shares outstanding during the period plus additional weighted-average common equivalent shares outstanding during the period when the effect is dilutive.

The following table sets forth the computation of basic and diluted net income (loss) per share for three years ended December 31, 2018:



	2018			2017			2016
	(in thousands, except per share amounts)
Basic net income (loss) attributable to Vertex per common share calculation:
Net income (loss) attributable to Vertex common shareholders	$	2,096,896		$	263,484		$	(112,052	)
Less: Undistributed earnings allocated to participating securities	(501		)	(293		)	—
Net income (loss) attributable to Vertex common shareholders—basic	$	2,096,395		$	263,191		$	(112,052	)

Basic weighted-average common shares outstanding	254,292			248,858			244,685
Basic net income (loss) attributable to Vertex per common share	$	8.24		$	1.06		$	(0.46	)

Diluted net income (loss) attributable to Vertex per common share calculation:
Net income (loss) attributable to Vertex common shareholders	$	2,096,896		$	263,484		$	(112,052	)
Less: Undistributed earnings allocated to participating securities	(492		)	(288		)	—
Net income (loss) attributable to Vertex common shareholders—diluted	$	2,096,404		$	263,196		$	(112,052	)

Weighted-average shares used to compute basic net income (loss) per common share	254,292			248,858			244,685
Effect of potentially dilutive securities:
Stock options	2,913			2,797			—
Restricted stock and restricted stock units (including PSUs)	1,963			1,542			—
Employee stock purchase plan	17			28			—
Weighted-average shares used to compute diluted net income (loss) per common share	259,185			253,225			244,685
Diluted net income (loss) attributable to Vertex per common share	$	8.09		$	1.04		$	(0.46	)

The Company did not include the securities in the following table in the computation of the net income (loss) per share attributable to Vertex common shareholders calculations because the effect would have been anti-dilutive during each period.



	2018	2017	2016
	(in thousands)
Stock options	2,217	3,554	12,642
Unvested restricted stock and restricted stock units (including PSUs)	5	411	3,546

Fair Value Measurements

12 Months Ended

Dec. 31, 2018

Fair Value Disclosures [Abstract]

Fair Value Measurements

The fair value of the Company’s financial assets and liabilities reflects the Company’s estimate of amounts that it would have received in connection with the sale of the assets or paid in connection with the transfer of the liabilities in an orderly transaction between market participants at the measurement date. In connection with measuring the fair value of its assets and liabilities, the Company seeks to maximize the use of observable inputs (market data obtained from sources independent from the Company) and to minimize the use of unobservable inputs (the Company’s assumptions about how market participants would price assets and liabilities). The following fair value hierarchy is used to classify assets and liabilities based on the observable inputs and unobservable inputs used in order to value the assets and liabilities:



Level 1:	Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis.
Level 2:	Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active.
Level 3:	Unobservable inputs based on the Company’s assessment of the assumptions that market participants would use in pricing the asset or liability.

The Company’s investment strategy is focused on capital preservation. The Company invests in instruments that meet the credit quality standards outlined in the Company’s investment policy. This policy also limits the amount of credit exposure to any one issue or type of instrument. As of December 31, 2018, the Company’s investments were primarily in money market funds, U.S. Treasury securities, government-sponsored enterprise securities, corporate equity securities, corporate debt securities and commercial paper. Additionally, the Company utilizes foreign currency forward contracts intended to mitigate the effect of changes in foreign exchange rates on its consolidated statement of operations.

As of December 31, 2018, all of the Company’s financial assets and liabilities that were subject to fair value measurements were valued using observable inputs. The Company’s financial assets valued based on Level 1 inputs consisted of money market funds, U.S. Treasury securities, government-sponsored enterprise securities and corporate equity securities. The Company’s financial assets and liabilities valued based on Level 2 inputs consisted of certain corporate equity securities as described below, corporate debt securities and commercial paper, which consisted of investments in highly-rated investment-grade corporations and foreign currency forward contracts with reputable and creditworthy counterparties. In 2018, Moderna became a publicly traded company. The Company has valued its investment in Moderna based on Level 2 inputs due to transfer restrictions for a period of time subsequent to Moderna’s initial public offering. The reduction in fair value recorded on the Company’s consolidated balance sheet related to this transfer restriction is not material to its financial statements. During 2018, 2017 and 2016, the Company did not record any other-than-temporary impairment charges related to its financial assets.

The following table sets forth the Company’s financial assets and liabilities (excluding VIE cash and cash equivalents) subject to fair value measurements:



	Fair Value Measurements as of December 31, 2018
				Fair Value Hierarchy
	Total			Level 1		Level 2			Level 3
	(in thousands)
Financial instruments carried at fair value (asset position):
Cash equivalents:
Money market funds	$	1,226,603		$	1,226,603	$	—		$	—
U.S. Treasury securities	5,966			5,966		—			—
Government-sponsored enterprise securities	7,123			7,123		—			—
Commercial paper	58,268			—		58,268			—
Marketable securities:
Corporate equity securities	167,323			153,733		13,590			—
U.S. Treasury securities	6,026			6,026		—			—
Government-sponsored enterprise securities	10,704			10,704		—			—
Corporate debt securities	233,665			—		233,665			—
Commercial paper	100,390			—		100,390			—
Prepaid and other current assets:
Foreign currency forward contracts	19,023			—		19,023			—
Other assets:
Foreign currency forward contracts	1,514			—		1,514			—
Total financial assets	$	1,836,605		$	1,410,155	$	426,450		$	—
Financial instruments carried at fair value (liability position):
Other liabilities, current portion:
Foreign currency forward contracts	$	(340	)	$	—	$	(340	)	$	—
Other liabilities, excluding current portion:
Foreign currency forward contracts	(108		)	—		(108		)	—
Total financial liabilities	$	(448	)	$	—	$	(448	)	$	—



	Fair Value Measurements as of December 31, 2017
				Fair Value Hierarchy
	Total			Level 1		Level 2			Level 3
	(in thousands)
Financial instruments carried at fair value (asset position):
Cash equivalents:
Money market funds	$	614,951		$	614,951	$	—		$	—
Government-sponsored enterprise securities	12,678			12,678		—			—
Commercial paper	57,357			—		57,357			—
Marketable securities:
Corporate equity securities	74,821			74,821		—			—
Government-sponsored enterprise securities	2,303			2,303		—			—
Corporate debt securities	265,867			—		265,867			—
Commercial paper	80,263			—		80,263			—
Prepaid and other current assets:
Foreign currency forward contracts	13			—		13			—
Total financial assets	$	1,108,253		$	704,753	$	403,500		$	—
Financial instruments carried at fair value (liability position):
Other liabilities, current portion:
Foreign currency forward contracts	$	(13,642	)	$	—	$	(13,642	)	$	—
Other liabilities, excluding current portion:
Foreign currency forward contracts	(866		)	—		(866		)	—
Total financial liabilities	$	(14,508	)	$	—	$	(14,508	)	$	—

Please refer to Note E, “Marketable Securities and Equity Investments,” for the carrying amount and related unrealized gains (losses) by type of the Company’s financial assets and liabilities.

As of December 31, 2018, the Company did not have any noncontrolling interest. As of December 31, 2017, the Company’s noncontrolling interest related to the Company’s VIE included the fair value of the contingent payments, which could consist of milestone, royalty and option payments, which were valued based on Level 3 inputs. Please refer to Note B, “Collaborative Arrangements and Acquisitions,” for further information regarding the fair value of the contingent payments.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Marketable Securities and Equity Investments

12 Months Ended

Dec. 31, 2018

Cash and Cash Equivalents [Abstract]

Marketable Securities and Equity Investments

Pursuant to the adoption of ASU 2016-01 on January 1, 2018, the Company began recording changes in the fair value of its investments in corporate equity securities (except those accounted for under the equity method of accounting or those that result in consolidation of an investee) to “Other (expense) income, net” in the Company’s consolidated statements of operations. Prior to its adoption of ASU 2016-01, the Company recorded changes in the fair value of its investments in corporate equity securities to “Accumulated other comprehensive income (loss)” on its consolidated balance sheet until the related gains or losses were realized. The Company continues to record unrealized gains (losses) on available-for-sale debt securities as a component of accumulated other comprehensive income (loss) until such gains and losses are realized.

A summary of the Company’s cash equivalents and marketable securities is shown below:



	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
	(in thousands)
As of December 31, 2018
Cash equivalents:
Money market funds	$	1,226,603	$	—	$	—		$	1,226,603
U.S. Treasury securities	5,967		—		(1		)	5,966
Government-sponsored enterprise securities	7,124		—		(1		)	7,123
Commercial paper	58,271		—		(3		)	58,268
Total cash equivalents	1,297,965		—		(5		)	1,297,960
Marketable securities:
U.S Treasury securities (matures within 1 year)	6,026		—		—			6,026
Government-sponsored enterprise securities (matures within 1 year)	10,704		—		—			10,704
Corporate debt securities (matures within 1 year)	232,845		25		(450		)	232,420
Corporate debt securities (matures after 1 year through 5 years)	1,243		2		—			1,245
Commercial paper (matures within 1 year)	100,498		—		(108		)	100,390
Total marketable debt securities	351,316		27		(558		)	350,785
Corporate equity securities	133,157		40,619		(6,453		)	167,323
Total marketable securities	$	484,473	$	40,646	$	(7,011	)	$	518,108

As of December 31, 2017
Cash equivalents:
Money market funds	$	614,951	$	—	$	—		$	614,951
Government-sponsored enterprise securities	12,679		—		(1		)	12,678
Commercial paper	57,371		—		(14		)	57,357
Total cash equivalents	685,001		—		(15		)	684,986
Marketable securities:
Government-sponsored enterprise securities (matures within 1 year)	2,304		—		(1		)	2,303
Corporate debt securities (matures within 1 year)	215,639		—		(363		)	215,276
Corporate debt securities (matures after 1 year through 5 years)	50,697		—		(106		)	50,591
Commercial paper (matures within 1 year)	80,372		—		(109		)	80,263
Total marketable debt securities	349,012		—		(579		)	348,433
Available-for-sale corporate equity securities	43,213		31,608		—			74,821
Total marketable securities	$	392,225	$	31,608	$	(579	)	$	423,254

Available-for-sale debt securities were recorded in the Company's consolidated balance sheets as follows:



	As of December 31,
	2018		2017
	(in thousands)
Cash and cash equivalents	$	1,297,960	$	684,986
Marketable securities	350,785		348,433
Total	$	1,648,745	$	1,033,419

The Company has a limited number of available-for-sale debt securities in insignificant loss positions as of December 31, 2018, which it does not intend to sell and has concluded it will not be required to sell before recovery of the amortized costs for the investments at maturity. The Company did not record any charges for other-than-temporary declines in the fair value of available-for-sale debt securities or gross realized gains or losses in 2018, 2017 or 2016.

The Company maintains strategic investments separately from the investment policy that governs its other cash, cash equivalents and marketable securities. The Company’s investments in the common stock of publicly traded companies have readily determinable fair values and are recorded in “Marketable securities” on its consolidated balance sheets. As of December 31, 2018, the fair value of the Company’s investments in the common stock of CRISPR, a publicly traded company and a related party, and Moderna, which became a publicly traded company in December 2018, were $153.7 million and $13.6 million, respectively. During the year ended December 31, 2018, the Company recorded unrealized gains of $2.6 million related to its investment in corporate equity securities, which included an unrealized gain of $9.0 million related to its investment in CRISPR offset by an unrealized loss of $6.5 million related to its investment in Moderna. In 2018, the Company invested $69.9 million in additional shares of CRISPR’s common stock.

As of December 31, 2018, the carrying value of the Company’s equity investments without readily determinable fair values, which are recorded in “Other assets” on its consolidated balance sheets, was $13.6 million.

Accumulated Other Comprehensive Income (Loss)

12 Months Ended

Dec. 31, 2018

Equity [Abstract]

Accumulated Other Comprehensive Income (Loss)

The following table summarizes the changes in accumulated other comprehensive income (loss) by component:



				Unrealized Holding Gains (Losses), Net of Tax
	Foreign Currency Translation Adjustment			On Available-For-Sale Debt Securities			On Equity Securities			On Foreign Currency Forward Contracts			Total
	(in thousands)
Balance at December 31, 2015	$	(2,080	)	$	126		$	—		$	3,778		$	1,824
Other comprehensive (loss) income before reclassifications	(5,782		)	(136		)	17,531			17,383			28,996
Amounts reclassified from accumulated other comprehensive income (loss)	—			—			—			(9,647		)	(9,647		)
Net current period other comprehensive (loss) income	(5,782		)	(136		)	17,531			7,736			19,349
Balance at December 31, 2016	$	(7,862	)	$	(10	)	$	17,531		$	11,514		$	21,173
Other comprehensive (loss) income before reclassifications	(13,169		)	(584		)	7,538			(29,175		)	(35,390		)
Amounts reclassified from accumulated other comprehensive income (loss)	—			—			—			2,645			2,645
Net current period other comprehensive (loss) income	(13,169		)	(584		)	7,538			(26,530		)	(32,745		)
Balance as of December 31, 2017	$	(21,031	)	$	(594	)	$	25,069		$	(15,016	)	$	(11,572	)
Other comprehensive income before reclassifications	8,855			58			—			25,664			34,577
Amounts reclassified from accumulated other comprehensive income (loss)	—			—			—			1,774			1,774
Net current period other comprehensive income	8,855			58			—			27,438			36,351
Amounts reclassified to accumulated deficit pursuant to adoption of new accounting standard	949			—			(25,069		)	—			(24,120		)
Balance as of December 31, 2018	$	(11,227	)	$	(536	)	$	—		$	12,422		$	659

Hedging

12 Months Ended

Dec. 31, 2018

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Hedging

Foreign currency forward contracts - Designated as hedging instruments

The Company maintains a hedging program intended to mitigate the effect of changes in foreign exchange rates for a portion of the Company’s forecasted product revenues denominated in certain foreign currencies. The program includes foreign currency forward contracts that are designated as cash flow hedges under GAAP having contractual durations from one to eighteen months. The Company recognizes realized gains and losses for the effective portion of such contracts in “Product revenues, net” in its consolidated statements of operations in the same period that it recognizes the product revenues that were impacted by the hedged foreign exchange rate changes.

The Company formally documents the relationship between foreign currency forward contracts (hedging instruments) and forecasted product revenues (hedged items), as well as the Company’s risk management objective and strategy for undertaking various hedging activities, which includes matching all foreign currency forward contracts that are designated as cash flow hedges to forecasted transactions. The Company also formally assesses, both at the hedge’s inception and on an ongoing basis, whether the foreign currency forward contracts are highly effective in offsetting changes in cash flows of hedged items on a prospective and retrospective basis. If the Company were to determine that a (i) foreign currency forward contract is not highly effective as a cash flow hedge, (ii) foreign currency forward contract has ceased to be a highly effective hedge or (iii) forecasted transaction is no longer probable of occurring, the Company would discontinue hedge accounting treatment prospectively. The Company measures effectiveness based on the change in fair value of the forward contracts and the fair value of the hypothetical foreign currency forward contracts with terms that match the critical terms of the risk being hedged. As of December 31, 2018, all hedges were determined to be highly effective and the Company has not recorded any ineffectiveness related to its hedging program since inception.

The Company considers the impact of its counterparties’ credit risk on the fair value of the foreign currency forward contracts. As of December 31, 2018 and December 31, 2017, credit risk did not change the fair value of the Company’s foreign currency forward contracts.

The following table summarizes the notional amount of the Company’s outstanding foreign currency forward contracts designated as cash flow hedges under GAAP:



	As of December 31,
	2018		2017
Foreign Currency	(in thousands)
Euro	$	335,179	$	257,230
British pound sterling	73,460		77,481
Australian dollar	52,820		30,501
Canadian dollar	43,759		—
Total foreign currency forward contracts	$	505,218	$	365,212

Foreign currency forward contracts - Not designated as hedging instruments

The Company also enters into foreign currency forward contracts with contractual maturities of less than one month designed to mitigate the effect of changes in foreign exchange rates on monetary assets and liabilities, including intercompany balances. These contracts are not designated as hedging instruments under GAAP. The Company recognizes realized gains and losses for such contracts in “Other (expense) income, net” in its consolidated statements of operations each period. As of December 31, 2018, the notional amount of the Company’s outstanding foreign currency forward contracts where hedge accounting under GAAP is not applied was $251.4 million.

During the three years ended December 31, 2018, the Company recognized the following related to foreign currency forward contacts in its consolidated statements of operations:



	December 31,
	2018			2017		2016
	(in thousands)
Designated as hedging instruments - Reclassified from AOCI
Product revenues, net	$	(1,252	)	$	768	$	10,543
Not designated as hedging instruments
Other (expense) income, net	$	623		$	14,129	$	(6,917	)

The following table summarizes the fair value of the Company’s outstanding foreign currency forward contracts designated as cash flow hedges under GAAP included on its consolidated balance sheets:



As of December 31, 2018
Assets			Liabilities
Classification	Fair Value		Classification	Fair Value
(in thousands)
Prepaid and other current assets	$	19,023	Other liabilities, current portion	$	(340	)
Other assets	1,514		Other liabilities, excluding current portion	(108		)
Total assets	$	20,537	Total liabilities	$	(448	)



As of December 31, 2017
Assets			Liabilities
Classification	Fair Value		Classification	Fair Value
(in thousands)
Prepaid and other current assets	$	13	Other liabilities, current portion	$	(13,642	)
Other assets	—		Other liabilities, excluding current portion	(866		)
Total assets	$	13	Total liabilities	$	(14,508	)

As of December 31, 2018, the Company expects amounts that are related to foreign exchange forward contracts designated as cash flow hedges under GAAP recorded in “Prepaid expenses and other current assets” and “Other liabilities, current portion” to be reclassified to earnings within twelve months.

The following table summarizes the potential effect of offsetting derivatives by type of financial instrument designated as cash flow hedges under GAAP on the Company’s consolidated balance sheets:



	As of December 31, 2018
	Gross Amounts Recognized			Gross Amounts Offset		Gross Amounts Presented			Gross Amounts Not Offset			Legal Offset
Foreign currency forward contracts	(in thousands)
Total assets	$	20,537		$	—	$	20,537		$	(448	)	$	20,089
Total liabilities	(448		)	—		(448		)	448			—



	As of December 31, 2017
	Gross Amounts Recognized			Gross Amounts Offset		Gross Amounts Presented			Gross Amounts Not Offset			Legal Offset
Foreign currency forward contracts	(in thousands)
Total assets	$	13		$	—	$	13		$	(13	)	$	—
Total liabilities	(14,508		)	—		(14,508		)	13			(14,495		)

Inventories

12 Months Ended

Dec. 31, 2018

Inventory Disclosure [Abstract]

Inventories

Inventories consisted of the following:



	As of December 31,
	2018		2017
	(in thousands)
Raw materials	$	9,677	$	20,924
Work-in-process	87,944		74,237
Finished goods	26,739		16,669
Total	$	124,360	$	111,830

Property and Equipment

12 Months Ended

Dec. 31, 2018

Property, Plant and Equipment [Abstract]

Property and Equipment

Property and equipment, net consisted of the following:



	As of December 31,
	2018			2017
	(in thousands)
Buildings	$	657,438		$	634,061
Furniture and equipment	280,908			256,509
Software	162,601			151,890
Leasehold improvements	103,428			117,806
Computers	59,073			61,294
Total property and equipment, gross	1,263,448			1,221,560
Less: accumulated depreciation	(451,443		)	(432,123		)
Total property and equipment, net	$	812,005		$	789,437

Total property and equipment, gross, as of December 31, 2018 and 2017, included $94.8 million and $100.9 million, respectively, for property and equipment recorded under capital leases. Accumulated depreciation, as of December 31, 2018 and 2017, included $34.0 million and $43.4 million, respectively, for property and equipment recorded under capital leases.

The Company recorded depreciation expense of $72.4 million, $61.4 million and $60.8 million in 2018, 2017 and 2016, respectively. The Company’s capital lease amortization is included in depreciation expense.

Intangible Assets and Goodwill	12 Months Ended
Intangible Assets and Goodwill	Dec. 31, 2018
Goodwill and Intangible Assets Disclosure [Abstract]
Intangible Assets and Goodwill	Intangible Assets and Goodwill Intangible Assets As of December 31, 2018, the Company had no in-process research and development intangible assets recorded on its consolidated balance sheet. As of December 31, 2017, the Company had a $29.0 million in-process research and development intangible asset related to VX-210 that was licensed from BioAxone in 2014 recorded on its consolidated balance sheet. In October 2018, the Company announced it would stop clinical development of VX-210 and terminate the Phase 2b clinical trial of VX-210 based on the recommendation of the clinical trial’s Data Safety Monitoring Board and the Company’s review of interim data the Company received in October 2018. As a result of this decision, the Company recorded a $29.0 million impairment charge and a benefit from income taxes of $7.9 million in 2018 attributable to noncontrolling interest. In 2017, the Company determined that there were indicators that the value of the Parion’s pulmonary ENaC platform intangible asset had become impaired. Prior to this determination, the Company reflected a $255.3 million in-process research and development intangible asset on its consolidated balance sheet related to Parion’s pulmonary ENaC platform, which included the intellectual property related to VX-371 and VX-551 that are licensed by Parion to the Company. The Company determined that the fair value of the intangible asset had decreased significantly based on data from a Phase 2 clinical trial of VX-371 that did not meet its primary efficacy endpoint. Based on this data, the Company evaluated the fair value of Parion’s pulmonary ENaC platform using the discounted cash flow approach from the perspective of a market participant and determined that the fair value of the intangible asset was zero as of September 30, 2017. The Company recorded a $255.3 million impairment charge and a benefit from income taxes of $97.7 million in 2017 attributable to noncontrolling interest. Goodwill As of each of December 31, 2018 and December 31, 2017, goodwill of $50.4 million was recorded on the Company’s consolidated balance sheet.

Additional Balance Sheet Detail

12 Months Ended

Dec. 31, 2018

Payables and Accruals [Abstract]

Additional Balance Sheet Detail

Prepaid and other current assets consisted of the following:



	As of December 31,
	2018		2017
	(in thousands)
Prepaid expenses	$	74,045	$	62,475
Collaborative accounts receivable	5,182		28,907
Other receivables and assets	61,592		75,742
Total	$	140,819	$	167,124

Accrued expenses consisted of the following:



	As of December 31,
	2018		2017
	(in thousands)
Payroll and benefits	$	124,753	$	113,026
Research, development and commercial contract costs	115,300		98,411
Product revenue allowances	195,598		119,919
Royalty payable	101,108		73,044
Other	67,736		39,561
Total	$	604,495	$	443,961

Long Term Obligations

12 Months Ended

Dec. 31, 2018

Debt Disclosure [Abstract]

Long Term Obligations

Long-term Obligations

Construction Financing Lease Obligation

As a result of the Company being involved in the construction of several of its leased buildings in Boston and San Diego, the Company was deemed for accounting purposes to be the owner of these buildings during their construction periods and recorded project construction costs incurred by its landlords. Upon completion of these buildings, the Company determined that the underlying leases did not meet the criteria for “sale-leaseback” treatment. Accordingly, the Company depreciates the lease assets and records interest expense associated with the financing obligations for these buildings. The Company bifurcates the lease payments pursuant to these leases into (i) a portion that is allocated to the buildings and (ii) a portion that is allocated to the land on which the buildings were constructed. The portion of the lease obligations allocated to the land is treated as an operating lease.

Fan Pier Leases

In 2011, the Company entered into two lease agreements, pursuant to which the Company leases approximately 1.1 million square feet of office and laboratory space in two buildings (the “Fan Pier Buildings”) at Fan Pier in Boston, Massachusetts (the “Fan Pier Leases”). The Company commenced lease payments in December 2013, and will make lease payments pursuant to the Fan Pier Leases through December 2028. The Company has an option to extend the term of the Fan Pier Leases for an additional ten years.

San Diego Lease

In 2015, the Company entered into a lease agreement for a facility in San Diego, California (the “San Diego Building”), pursuant to which it leases approximately 170,000 square feet of office and laboratory space in San Diego, California (“San Diego Lease”) for a term of 16 years. Base rent payments will commence in the second quarter of 2019. Pursuant to the San Diego Lease, during the initial 16-year term, the Company will pay an average of approximately $10.2 million per year in aggregate rent, excluding operating expenses. The Company has the option to extend the lease term for up to two additional five-year terms.

Property and equipment, net and the carrying value of the Company’s construction financing lease obligation (including current and non-current portions and excluding interest that will be imputed over the course of the Company’s underlying lease agreements for these buildings) related to the Fan Pier Buildings and the San Diego Building were as follows:



	As of December 31,
	2018		2017
	(in thousands)
Property and equipment, net
Fan Pier Buildings	$	462,863	$	475,725
San Diego Building	$	113,296	$	94,602

Construction financing lease obligation
Fan Pier Buildings	$	471,058	$	472,070
San Diego Building	$	96,105	$	87,392

Revolving Credit Facility

In October 2016, the Company entered into a Credit Agreement (the “Credit Agreement”) with Bank of America, N.A., as administrative agent and the lenders referred to therein. The Credit Agreement provides for a $500.0 million revolving facility, $300.0 million of which was drawn at closing (the “Loans”) and was repaid in February 2017. The Credit Agreement also provides that, subject to satisfaction of certain conditions, the Company may request that the borrowing capacity under the Credit Agreement be increased by an additional $300.0 million. The Credit Agreement matures on October 13, 2021.

The proceeds of the borrowing under the Credit Agreement were used primarily to terminate and repay all outstanding obligations under the Company’s senior secured term loan with Macquarie US Trading LLC, as administrative agent, that had been outstanding since 2014. The Loans will bear interest, at the Company's option, at either a base rate or a Eurodollar rate, in each case plus an applicable margin. Under the Credit Agreement, the applicable margins on base rate loans range from 0.75% to 1.50% and the applicable margins on Eurodollar loans range from 1.75% to 2.50%, in each case based on the Company's consolidated leverage ratio (the ratio of the Company's total consolidated debt to the Company's trailing twelve-month EBITDA).

The Loans are guaranteed by certain of the Company's domestic subsidiaries and secured by substantially all of the Company's assets and the assets of the Company's domestic subsidiaries (excluding intellectual property, owned and leased real property and certain other excluded property) and by the equity interests of the Company's subsidiaries, subject to certain exceptions. Under the terms of the Credit Agreement, the Company must maintain, subject to certain limited exceptions, a consolidated leverage ratio of 3.00 to 1.00 and consolidated EBITDA of at least $200.0 million, in each case measured on a quarterly basis.

The Credit Agreement contains customary representations and warranties and usual and customary affirmative and negative covenants. The Credit Agreement also contains customary events of default. In the case of a continuing event of default, the administrative agent would be entitled to exercise various remedies, including the acceleration of amounts due under outstanding loans.

Common Stock, Preferred Stock and Equity Plans

12 Months Ended

Dec. 31, 2018

Equity [Abstract]

Common Stock, Preferred Stock and Equity Plans

Common Stock and Preferred Stock

The Company is authorized to issue 500,000,000 shares of common stock. Holders of common stock are entitled to one vote per share. Holders of common stock are entitled to receive dividends, if and when declared by the Company’s Board of Directors, and to share ratably in the Company’s assets legally available for distribution to the Company’s shareholders in the event of liquidation. Holders of common stock have no preemptive, subscription, redemption or conversion rights. The holders of common stock do not have cumulative voting rights.

The Company is authorized to issue 1,000,000 shares of preferred stock in one or more series and to fix the powers, designations, preferences and relative participating, option or other rights thereof, including dividend rights, conversion rights, voting rights, redemption terms, liquidation preferences and the number of shares constituting any series, without any further vote or action by the Company’s shareholders. As of December 31, 2018 and 2017, the Company had no shares of preferred stock issued or outstanding.

Share Repurchase Program

The Company’s Board of Directors approved a share repurchase program, pursuant to which the Company is authorized to repurchase up to $500.0 million of its common stock between February 1, 2018 and December 31, 2019. Under the share repurchase program, the Company is authorized to purchase shares from time to time through open market or privately negotiated transactions. Such purchases may be made pursuant to Rule 10b5-1 plans or other means as determined by the Company’s management and in accordance with the requirements of the SEC.

During the year ended December 31, 2018, the Company repurchased 2,093,891 shares of its common stock under the share repurchase program for an aggregate of $350.0 million, including commissions and fees. The Company expects to fund further repurchases of its common stock through a combination of cash on hand and cash generated by operations.

Stock and Option Plans

The purpose of each of the Company’s stock and option plans is to attract, retain and motivate its employees, consultants and directors. Awards granted under these plans can be incentive stock options (“ISOs”), nonstatutory stock options (“NSOs”), restricted stock (“RSs”), restricted stock units (“RSUs”) including performance-based RSUs (“PSUs”) or other equity-based awards, as specified in the individual plans.

Shares issued under all of the Company’s plans are funded through the issuance of new shares. The following table contains information about the Company’s equity plans:



			As of December 31, 2018
Title of Plan	Group Eligible	Type of Award Granted	Awards Outstanding	Additional Awards Authorized for Grant
2013 Stock and Option Plan	Employees, Non-employee Directors and Consultants	NSO, RS, RSU and PSU	10,735,107	14,737,360
2006 Stock and Option Plan	Employees, Non-employee Directors and Consultants	NSO, RS and RSU	1,770,994	—
		Total	12,506,101	14,737,360

All options granted under the Company’s 2013 Stock and Option Plan (“2013 Plan”) and 2006 Stock and Option Plan (“2006 Plan”) were granted with an exercise price equal to the fair value of the underlying common stock on the date of grant. As of December 31, 2018, the stock and option plan under which the Company is authorized to make new equity awards is the Company’s 2013 Plan. Under the 2013 Plan, no stock options can be awarded with an exercise price less than the fair market value on the date of grant. In the three years ended December 31, 2018, the Company’s shareholders approved increases in the number of shares authorized for issuance pursuant to the 2013 Stock and Option Plan of (i) 8,000,000 shares in 2018, and (ii) 6,750,000 shares in 2017.

During the three years ended December 31, 2018, grants to current employees and directors primarily had a grant date that was the same as the date the award was approved by the Company’s Board of Directors. During the three years ended December 31, 2018, for grants to new employees and directors, the date of grant for awards was the employee’s first day of employment or the date the director was elected to the Company’s Board of Directors. All options awarded under the Company’s stock and option plans expire not more than 10 years from the grant date.

Stock Options

The following table summarizes information related to the outstanding and exercisable options during the year ended December 31, 2018:



	Stock Options		Weighted-average Exercise Price		Weighted-average Remaining Contractual Life	Aggregate Intrinsic Value
	(in thousands)		(per share)		(in years)	(in thousands)
Outstanding at December 31, 2017	9,767		$	91.57
Granted	2,297		$	164.11
Exercised	(3,076	)	$	85.66
Forfeited	(431	)	$	125.37
Expired	(6	)	$	98.30
Outstanding at December 31, 2018	8,551		$	111.46	6.92	$	462,563
Exercisable at December 31, 2018	4,577		$	93.21	5.63	$	325,382

The aggregate intrinsic value in the table above represents the total pre-tax amount, net of exercise price, that would have been received by option holders if all option holders had exercised all options with an exercise price lower than the market price on the last business day of 2018, which was $164.11 based on the average of the high and low price of the Company’s common stock on that date.

The total intrinsic value (the amount by which the fair market value exceeded the exercise price) of stock options exercised during 2018, 2017 and 2016 was $258.2 million, $302.8 million and $48.6 million, respectively. The total cash received by the Company as a result of employee stock option exercises during 2018, 2017 and 2016 was $263.4 million, $323.3 million and $48.5 million, respectively.

The following table summarizes information about stock options outstanding and exercisable at December 31, 2018:



	Options Outstanding				Options Exercisable
Range of Exercise Prices	Number Outstanding	Weighted-average Remaining Contractual Life	Weighted-average Exercise Price		Number Exercisable	Weighted-average Exercise Price
	(in thousands)	(in years)	(per share)		(in thousands)	(per share)
$29.07–$40.00	532	1.08	$	34.89	532	$	35.89
$40.01–$60.00	470	3.51	$	50.04	470	$	50.04
$60.01–$80.00	543	5.25	$	74.90	533	$	74.89
$80.01–$100.00	2,839	7.18	$	89.19	1320	$	89.85
$100.01–$120.00	693	6.09	$	109.30	603	$	109.22
$120.01–$140.00	839	6.62	$	130.27	642	$	130.24
$140.01–$160.00	1,400	9.06	$	155.52	271	$	155.30
$160.01–$180.00	526	8.50	$	162.94	156	$	162.94
$180.01–$181.60	709	9.53	$	181.60	50	$	181.60
Total	8,551	6.92	$	111.46	4,577	$	93.21

Restricted Stock and Restricted Stock Units (excluding PSUs)

The following table summarizes the restricted stock and restricted stock unit activity of the Company during the year ended December 31, 2018:



	Restricted Stock				Restricted Stock Units (excluding PSUs)
	Number of Units		Weighted-average Grant-date Fair Value		Number of Shares		Weighted-average Grant-date Fair Value
	(in thousands)		(per share)		(in thousands)		(per share)
Unvested at December 31, 2017	1,229		$	102.12	2,011		$	109.27
Granted	—		$	—	1,600		$	164.70
Vested	(690	)	$	100.07	(629	)	$	108.02
Cancelled	(59	)	$	101.55	(265	)	$	132.26
Unvested at December 31, 2018	480		$	104.91	2,717		$	140.10

The total fair value of restricted stock that vested during 2018, 2017 and 2016 (measured on the date of vesting) was $114.5 million, $157.0 million and $74.1 million, respectively. The total fair value of restricted stock units that vested during 2018, 2017 and 2016 (measured on the date of vesting) was $104.8 million, $33.2 million and $5.3 million, respectively.

Performance-based RSUs (PSUs)

The potential range of shares issuable pursuant to the Company’s PSU awards range from 0% to 200% of the target shares based on financial and non-financial measures. Fifty percent of PSUs that could be earned have a one-year performance period with the amount actually earned dependent upon the Company’s financial performance and with vesting of the earned shares in three equal installments over a three-year period. The remaining 50% of PSUs that could be earned have a three-year performance period with the amount actually earned dependent upon the achievement of multiple clinical development milestones and with the earned shares cliff vesting at the end of the three-year performance period.

The following table summarizes the PSU activity of the Company during the year ended December 31, 2018:



	Performance-Based RSU
	Number of Units		Weighted-average Grant-date Fair Value
	(in thousands)		(per share)
Unvested at December 31, 2017 (1)	484		$	87.59
Granted (2)	494		$	152.40
Vested	(154	)	$	87.13
Cancelled	(65	)	$	99.34
Unvested at December 31, 2018	759		$	110.50

(1) “Unvested” represents the Company’s PSUs at target to the extent performance has not been certified plus the actual number of shares that continue to be subject to service conditions for which the performance has been achieved and certified.
(2) “Granted” represents (i) the target number of shares issuable for grants during 2018 and (ii) any change in the number of shares issuable pursuant to outstanding PSUs based on performance certification during 2018.

The total fair value of PSUs that vested during 2018 and 2017 (measured on the date of vesting) was $23.2 million and $1.3 million, respectively. There were no PSUs that vested during 2016, which was the first year that the Company granted PSUs.

Employee Stock Purchase Plan

The Company has an employee stock purchase plan (the “ESPP”). The ESPP permits eligible employees to enroll in a twelve-month offering period comprising two six-month purchase periods. Participants may purchase shares of the Company’s common stock, through payroll deductions, at a price equal to 85% of the fair market value of the common stock on the first day of the applicable twelve-month offering period, or the last day of the applicable six-month purchase period, whichever is lower. Purchase dates under the ESPP occur on or about May 14 and November 14 of each year. As of December 31, 2018, there were 402,602 shares of common stock authorized for issuance pursuant to the ESPP.

In 2018, the following shares were issued to employees under the ESPP:



	Year Ended December 31, 2018
	(in thousands, except per share amount)
Number of shares	213,654
Average price paid per share	$	117.52

Stock-based Compensation Expense

12 Months Ended

Dec. 31, 2018

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock-based Compensation Expense

The Company recognizes share-based payments to employees as compensation expense using the fair value method. The fair value of stock options and shares purchased pursuant to the ESPP is calculated using the Black-Scholes option pricing model. The fair value of restricted stock and restricted stock units, including PSUs, is based on the intrinsic value on the date of grant. Stock-based compensation, measured at the grant date based on the fair value of the award, is typically recognized as expense ratably over the requisite service period. In 2017 and 2018, the expense recognized over the requisite service period was recorded net of the impact for actual awards that were forfeited prior to vesting in accordance with accounting guidance that became effective in January 1, 2017. Prior to adoption of this guidance, the expense recognized included an estimate of awards that would be forfeited prior to vesting.

The effect of stock-based compensation expense during the three years ended December 31, 2018 was as follows:



	2018		2017		2016
	(in thousands)
Stock-based compensation expense by line item:
Cost of sales	$	4,543	$	2,500	$	2,918
Research and development expenses	203,112		181,900		153,451
Sales, general and administrative expenses	117,392		108,836		84,254
Total stock-based compensation expense included in costs and expenses	$	325,047	$	293,236	$	240,623

The stock-based compensation expense by type of award during the three years ended December 31, 2018 was as follows:



	2018			2017			2016
	(in thousands)
Stock-based compensation expense by type of award:
Stock options	$	107,854		$	105,367		$	114,768
Restricted stock and restricted stock units (including PSUs)	207,845			181,258			118,709
ESPP share issuances	9,933			9,017			7,835
Stock-based compensation expense related to inventories	(585		)	(2,406		)	(689		)
Total stock-based compensation expense included in costs and expenses	$	325,047		$	293,236		$	240,623

The Company capitalizes stock-based compensation expense to inventories, all of which is attributable to employees who support the Company’s manufacturing operations for the Company’s products.

The following table sets forth the Company’s unrecognized stock-based compensation expense as of December 31, 2018, by type of award and the weighted-average period over which that expense is expected to be recognized:



	As of December 31, 2018
	Unrecognized Expense		Weighted-average Recognition Period
	(in thousands)		(in years)
Type of award:
Stock options	$	155,465	2.64
Restricted stock and restricted stock units (including PSUs)	$	321,683	2.58
ESPP share issuances	$	5,132	0.58

Stock Options

The Company issues stock options with service conditions, which are generally the vesting periods of the awards. The Company uses the Black-Scholes option pricing model to estimate the fair value of stock options at the grant date. The Black-Scholes option pricing model uses the option exercise price as well as estimates and assumptions related to the expected price volatility of the Company’s stock, the rate of return on risk-free investments, the expected period during which the options will be outstanding, and the expected dividend yield for the Company’s stock to estimate the fair value of a stock option on the grant date. The options granted during 2018, 2017 and 2016 had a weighted-average grant-date fair value per share of $60.83, $43.27 and $37.93, respectively.

The fair value of each option granted during 2018, 2017 and 2016 was estimated on the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions:



	2018		2017		2016
Expected stock price volatility	40.50	%	45.31	%	46.77	%
Risk-free interest rate	2.61	%	1.94	%	1.32	%
Expected term of options (in years)	4.55		4.68		4.91
Expected annual dividends	—		—		—

The weighted-average valuation assumptions were determined as follows:


•	Expected stock price volatility: Expected stock price volatility is calculated using the trailing one month average of daily implied volatilities prior to the grant date. Implied volatility is based on options to purchase the Company’s stock with remaining terms of greater than one year that are regularly traded in the market.


•	Risk-free interest rate: The Company bases the risk-free interest rate on the interest rate payable on U.S. Treasury securities in effect at the time of grant for a period that is commensurate with the assumed expected option term.

•

Expected term of options: The expected term of options represents the period of time options are expected to be outstanding. The Company uses historical data to estimate employee exercise and post-vest termination behavior. The Company believes that all groups of employees exhibit similar exercise and post-vest termination behavior and therefore does not stratify employees into multiple groups in determining the expected term of options.


•	Expected annual dividends: The estimate for annual dividends is $0.00 because the Company has not historically paid, and does not intend for the foreseeable future to pay, a dividend.

Restricted Stock, Restricted Stock Units and Performance-based Restricted Stock Units

The Company awards restricted stock and restricted stock units with service conditions, which are generally the vesting periods of the awards. Prior to 2017, the Company also awarded, to certain members of senior management, on an annual basis restricted stock and restricted stock units that vest upon the earlier of the satisfaction of (i) a performance condition or (ii) a service condition.

In February 2016, the Company began granting PSUs to certain members of senior management. Half of the PSUs contain financial goals as the performance metric and the other half contain non-financial goals. A target number of shares was established for each award, however the actual number of shares that are issued when an award vests may range from zero to 200% of the target amount depending upon the level of achievement of the applicable performance metric. The financial-based PSUs vest in three equal installments over a three-year period and are expensed ratably over that same period based upon an assessment of the likely level of achievement. The non-financial based PSUs cliff vest at the end of the three-year performance period and are expensed on a straight-line basis over that same period based upon an assessment of the likely level of achievement.

Employee Stock Purchase Plan

The weighted-average fair value of each purchase right granted during 2018, 2017 and 2016 was $44.04, $35.90 and $26.86, respectively. The following table reflects the weighted-average assumptions used in the Black-Scholes option pricing model for 2018, 2017 and 2016:



	2018		2017		2016
Expected stock price volatility	36.51	%	39.09	%	48.22	%
Risk-free interest rate	2.36	%	1.24	%	0.56	%
Expected term (in years)	0.75		0.75		0.75
Expected annual dividends	—		—		—

The expected stock price volatility for ESPP offerings is based on implied volatility. The Company bases the risk-free interest rate on the interest rate payable on U.S. Treasury securities in effect at the time of grant for a period that is commensurate with the assumed expected term. The expected term represents purchases and purchase periods that take place within the offering period. The expected annual dividends estimate is $0.00 because the Company has not historically paid, and does not for the foreseeable future intend to pay, a dividend.

Income Taxes

12 Months Ended

Dec. 31, 2018

Income Tax Disclosure [Abstract]

Income Taxes

The components of income (loss) before (benefit from) provision for income taxes during the three years ended December 31, 2018 consisted of the following:



	2018			2017			2016
	(in thousands)
United States	$	812,086		$	330,340		$	(147,860	)
Foreign	(211,845		)	(346,029		)	80,494
Income (loss) before (benefit from) provision for income taxes	$	600,241		$	(15,689	)	$	(67,366	)

On a periodic basis, the Company reassesses the valuation allowance on its deferred income tax assets weighing positive and negative evidence to assess the recoverability of the deferred tax assets. In the fourth quarter of 2018, the Company assessed the valuation allowance and considered positive evidence, including significant cumulative consolidated and U.S. income over the three years ended December 31, 2018, revenue growth, clinical trial data from the Company’s triple combination regimens, competitor clinical progress and expectations regarding future profitability, and negative evidence, including the potential impact of competition on the Company’s projections and cumulative losses in one of the jurisdictions. After assessing both the positive evidence and the negative evidence, the Company determined it was more likely than not that its deferred tax assets would be realized in the future and released the valuation allowance on the majority of its NOLs and other deferred tax assets as of December 31, 2018, resulting in a benefit from income taxes of $1.56 billion. As of December 31, 2018, the Company maintained a valuation allowance of $168.5 million related primarily to U.S. state and foreign tax attributes.

The components of the (benefit from) provision for income taxes during the three years ended December 31, 2018 consisted of the following:



	2018			2017			2016
	(in thousands)
Current taxes:
United States	$	772		$	11,559		$	(3,821	)
Foreign	15,600			3,576			1,794
State	9,018			5,025			1,836
Total current taxes	25,390			20,160			(191		)
Deferred taxes:
United States	(1,105,053		)	(113,805		)	18,659
Foreign	(364,919		)	(3,222		)	(3,359		)
State	(42,280		)	(10,457		)	1,556
Total deferred taxes	(1,512,252		)	(127,484		)	16,856
(Benefit from) provision for income taxes	$	(1,486,862	)	$	(107,324	)	$	16,665

A reconciliation of the (benefit from) provision for income taxes as computed by applying the U.S. federal statutory rate of 21% for the year ended December 31, 2018 and 35% for the years ended December 31, 2017 and 2016 to the (benefit from) provision for income taxes is as follows:



	2018			2017			2016
	(in thousands)
Income (loss) before (benefit from) provision for income taxes	$	600,241		$	(15,689	)	$	(67,366	)

Expected provision for (benefit from) income taxes	126,051			(5,491		)	(23,578		)
State taxes, net of federal benefit	8,680			4,742			3,621
Foreign income tax rate differential	23,427			77,801			21,346
Tax credits	(52,629		)	(58,204		)	(47,773		)
(Benefit from) provision for income taxes attributable to valuation allowances	(1,563,169		)	(575,801		)	14,837
Permanent items	1,421			15,324			24,663
Rate change	—			575,192			12,836
Stock compensation (benefit) shortfalls and cancellations	(49,044		)	(21,453		)	4,162
Officer’s compensation	8,310			6,501			86
Tax attribute expiration	—			—			9,947
Deconsolidation of VIE	(9,390		)	(126,183		)	—
Uncertain tax positions	15,431			—			—
Other	4,050			248			(3,482		)
(Benefit from) provision for income taxes	$	(1,486,862	)	$	(107,324	)	$	16,665

In 2018, the change in the “(Benefit from) provision for income taxes attributable to valuation allowances” on deferred tax assets in the tax rate reconciliation table above was primarily related to the release of the Company’s valuation allowances on the majority of its NOLs and other deferred tax assets related to the United States and the United Kingdom. In 2017, the valuation allowance decreased by $178.2 million primarily due to the utilization of NOLs in the United States and a decrease in the U.S. federal corporate tax rate from 35% to 21% partially offset by the adoption of ASU 2016-09. In 2016, the valuation allowance increased by $14.8 million primarily due to an increase in tax credits in the U.S. and an increase in the NOL in the United Kingdom.

On December 22, 2017, H.R.1., known as the Tax Cuts and Jobs Act, was signed into law. The new law did not have a significant impact on the Company’s consolidated financial statements for the year ended December 31, 2017. However, the reduction of the U.S. federal corporate tax rate from 35% to 21% resulted in increases to the amounts reflected in “(Benefit from) provision for income taxes attributable to valuation allowances” and “Rate change” in the Company’s tax reconciliation table above for the year ended December 31, 2017 compared to the year ended December 31, 2016. The change in the U.S. federal corporate tax rate, which was effective January 1, 2018, is also reflected in the Company’s deferred tax table below. Staff Accounting Bulletin No. 118’s (“SAB 118”) impact on the Company’s consolidated financial statements is discussed below.

In 2018 and 2017, “Deconsolidation of VIE” in the Company’s tax rate reconciliation above related to the impairments of VX-210 and Parion’s pulmonary ENaC platform, respectively, and the decreases in the Company’s fair value of the contingent payments to BioAxone and Parion associated with these deconsolidations, respectively. Please refer to Note J, “Intangible Assets and Goodwill,” for further information regarding these impairments.

The Company operates in foreign tax jurisdictions, which impose income taxes at different rates than the United States. The impact of these rate differences, which are primarily related to the Company’s operations in the United Kingdom, is included in the “Foreign income tax rate differential” in the Company’s tax rate reconciliation above. Other items that affected the Company’s tax rate reconciliation table were related to equity and executive compensation, research and development credits, Orphan Drug Credits and foreign amortization during the three years ended December 31, 2018.

Deferred tax assets and liabilities are determined based on the difference between financial statement and tax bases using enacted tax rates in effect for the year in which the differences are expected to reverse. The components of the deferred taxes were as follows:



	As of December 31,
	2018			2017
	(in thousands)
Deferred tax assets:
Net operating loss	$	882,014		$	1,004,404
Tax credit carryforwards	487,635			440,429
Intangible assets	241,775			54,091
Deferred revenues	19,311			19,593
Stock-based compensation	93,915			83,196
Accrued expenses	17,795			17,808
Construction financing lease obligation	130,849			109,354
Other	6,831			5,667
Gross deferred tax assets	1,880,125			1,734,542
Valuation allowance	(168,491		)	(1,552,942		)
Total deferred tax assets	1,711,634			181,600
Deferred tax liabilities:
Property and equipment	(128,407		)	(101,019		)
Acquired intangibles	—			(6,341		)
Deferred revenue	(73,357		)	(73,357		)
Unrealized gain	(10,198		)	(6,401		)
Net deferred tax assets (liabilities)	$	1,499,672		$	(5,518	)

The Company presents its deferred tax assets and deferred tax liabilities gross on its consolidated balance sheets. As of December 31, 2018, the majority of the Company’s net deferred tax assets were related to NOLs and tax credit carryforwards. As of December 31, 2017, the Company’s net deferred tax liability, which was primarily attributable to the Company’s collaboration with BioAxone, was not material to the Company’s consolidated financial statements.

As of December 31, 2018, the Company had NOL carryforwards of $2.9 billion and tax credits of $350.7 million for U.S. federal income tax purposes and had NOL carryforwards of $775.5 million and tax credits of $134.9 million for U.S. state income tax purposes. These U.S. federal and state NOL carryforwards and tax credits expire at various dates through 2038 and may be used to offset future federal and state income tax liabilities, respectively. As of December 31, 2018, the Company had foreign net operating loss carryforwards of $942.0 million, including $7.6 million that were subject to expiration and $934.4 million that had an indefinite carryforward period.

Unrecognized tax benefits during the three years ended December 31, 2018 were as follows:



	2018		2017		2016
	(in thousands)
Balance at beginning of the period	$	3,814	$	—	$	425
Increases related to current period tax positions	9,704		3,814		—
Increases related to prior period tax positions	6,031		—		—
Decrease due to statute limitations	—		—		(425		)
Balance at end of period	$	19,549	$	3,814	$	—

As of December 31, 2018, the Company has classified $7.6 million and $11.9 million of its unrecognized tax benefits as credits to “Deferred tax assets” and “Accrued expenses”, respectively on its consolidated balance sheet.

The Company has reviewed the tax positions taken, or to be taken, in its tax returns for all tax years currently open to examination by a taxing authority. Unrecognized tax benefits represent the aggregate tax effect of differences between tax return positions and the benefits recognized in the financial statements. As of December 31, 2018, the Company had $19.5 million of gross unrecognized tax benefits, which would affect the Company's tax rate if recognized. As of December 31, 2017, the Company had $3.8 million of gross unrecognized tax benefits, which would not affect the Company's tax rate if recognized. The Company does not expect that its unrecognized tax benefits will materially increase within the next twelve months. The Company recognizes interest and penalties related to income taxes as a component of its “(Benefit from) provision for income taxes.” As of December 31, 2018, no interest and penalties have been accrued. The Company did not recognize any material interest or penalties related to uncertain tax positions during the three years ended December 31, 2018.

In December 2017, the SEC staff issued SAB 118 to address the application of GAAP in situations when a registrant does not have the necessary information available, prepared, or analyzed (including computations) in reasonable detail to complete the accounting for certain income tax effects of H.R.1. The Company recognized the provisional tax impacts related to deemed repatriated earnings and the revaluation of deferred tax assets and liabilities and included these amounts in its consolidated financial statements for the year ended December 31, 2017. The Company did not record any adjustments in the year ended December 31, 2018 to these provisional amounts that were material to its financial statements. As of December 31, 2018, the Company’s accounting treatment is complete.

As of December 31, 2018, unremitted foreign earnings, which were not significant, have been retained by the Company’s foreign subsidiaries for indefinite reinvestment. Upon repatriation of those earnings, in the form of dividends or otherwise, the Company could be subject to immaterial withholding taxes payable to the various foreign countries.

The Company files U.S. federal income tax returns and income tax returns in various state, local and foreign jurisdictions. The Company is no longer subject to any tax assessment from an income tax examination in the United States or any other major taxing jurisdiction for years before 2011, except where the Company has NOLs or tax credit carryforwards that originate before 2011. The Company currently is under examination in Canada for 2011 through 2013, Germany for 2012 through 2015, Italy for 2015 and 2016 and the United Kingdom for 2015 and 2016. No adjustments have been reported. The Company is not under examination by any other jurisdictions for any tax year.

Employee Benefits	12 Months Ended
Employee Benefits	Dec. 31, 2018
Retirement Benefits [Abstract]
Employee Benefits	Employee Benefits The Company has a 401(k) retirement plan (the “Vertex 401(k) Plan”) in which substantially all of its permanent U.S. employees are eligible to participate. Participants may contribute up to 60% of their annual compensation to the Vertex 401(k) Plan, subject to statutory limitations. The Company may declare discretionary matching contributions to the Vertex 401(k) Plan. The Company pays matching contributions in the form of cash. For the years ended December 31, 2018, 2017 and 2016, the Company contributed approximately $13.9 million, $12.3 million and $11.8 million to the plan, respectively.

Commitments and Contingencies

12 Months Ended

Dec. 31, 2018

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Lease Obligations

For information regarding the Company’s lease commitments for its corporate headquarters in Boston, Massachusetts and its location in San Diego, California please refer to Note L, “Long-term Obligations.”

As of December 31, 2018, future minimum commitments under the facility leases with initial terms of more than one year were as follows:



Year	Fan Pier Leases		San Diego Lease		Other Leases		Total Lease Commitments
	(in thousands)
2019	$	66,540	$	5,324	$	13,207	$	85,071
2020	72,589		9,127		14,270		95,986
2021	72,589		9,127		12,529		94,245
2022	72,589		9,127		12,045		93,761
2023	72,589		9,530		11,952		94,071
Thereafter	389,855		119,864		65,472		575,191
Total minimum lease payments	$	746,751	$	162,099	$	129,475	$	1,038,325

As of December 31, 2018, the Company’s total sublease income to be received related to its facility leases was $6.2 million.

During 2018, 2017 and 2016, rental expense was $17.3 million, $19.2 million and $19.1 million, respectively. The majority of the Company’s lease payments related to the Fan Pier Leases are recorded as interest expense because the Company is deemed for accounting purposes to be the owner of the Buildings. Please refer to Note L, “Long-term Obligations,” for further information.

The Company has outstanding leases, which are accounted for as capital leases, for equipment and leasehold improvements. The capital leases bear interest at rates ranging from less than 1% to 6% per year. The following table sets forth the Company’s future minimum payments due under capital leases as of December 31, 2018:



Year	(in thousands)
2019	$	10,770
2020	7,282
2021	5,649
2022	3,300
2023	1,974
Thereafter	3,085
Total payments	32,060
Less: amount representing interest	(2,585		)
Present value of payments	$	29,475

In addition, the Company has committed to make potential future milestone and royalty payments pursuant to certain collaboration agreements and an asset acquisition agreement. Payments generally become due and payable upon the achievement of certain developmental, regulatory and/or commercial milestones. Please refer to Note B, “Collaborative Arrangements and Acquisitions,” for further information.

Guaranties and Indemnifications

As permitted under Massachusetts law, the Company’s Articles of Organization and By-laws provide that the Company will indemnify certain of its officers and directors for certain claims asserted against them in connection with their service as an officer or director. The maximum potential amount of future payments that the Company could be required to make under these indemnification provisions is unlimited. However, the Company has purchased directors’ and officers’ liability insurance policies that could reduce its monetary exposure and enable it to recover a portion of any future amounts paid. No indemnification claims currently are outstanding, and the Company believes the estimated fair value of these indemnification arrangements is minimal.

The Company customarily agrees in the ordinary course of its business to indemnification provisions in agreements with clinical trial investigators and sites in its drug development programs, sponsored research agreements with academic and not-for-profit institutions, various comparable agreements involving parties performing services for the Company, and its real estate leases. The Company also customarily agrees to certain indemnification provisions in its drug discovery, development and commercialization collaboration agreements. With respect to the Company’s clinical trials and sponsored research agreements, these indemnification provisions typically apply to any claim asserted against the investigator or the investigator’s institution relating to personal injury or property damage, violations of law or certain breaches of the Company’s contractual obligations arising out of the research or clinical testing of the Company’s compounds or drug candidates. With respect to lease agreements, the indemnification provisions typically apply to claims asserted against the landlord relating to personal injury or property damage caused by the Company, to violations of law by the Company or to certain breaches of the Company’s contractual obligations. The indemnification provisions appearing in the Company’s collaboration agreements are similar to those for the other agreements discussed above, but in addition provide some limited indemnification for its collaborator in the event of third-party claims alleging infringement of intellectual property rights. In each of the cases above, the indemnification obligation generally survives the termination of the agreement for some extended period, although the Company believes the obligation typically has the most relevance during the contract term and for a short period of time thereafter. The maximum potential amount of future payments that the Company could be required to make under these provisions is generally unlimited. The Company has purchased insurance policies covering personal injury, property damage and general liability that reduce its exposure for indemnification and would enable it in many cases to recover all or a portion of any future amounts paid. The Company has never paid any material amounts to defend lawsuits or settle claims related to these indemnification provisions. Accordingly, the Company believes the estimated fair value of these indemnification arrangements is minimal.

Other Contingencies

The Company has certain contingent liabilities that arise in the ordinary course of its business activities. The Company accrues a reserve for contingent liabilities when it is probable that future expenditures will be made and such expenditures can be reasonably estimated. There were no material contingent liabilities accrued as of December 31, 2018 or 2017.

Segment Information

12 Months Ended

Dec. 31, 2018

Segment Reporting [Abstract]

Segment Information

Segment reporting is prepared on the same basis that the Company’s chief executive officer, who is the Company’s chief operating decision maker, manages the business, makes operating decisions and assesses performance. The Company operates in one segment, pharmaceuticals. Enterprise-wide disclosures about revenues, significant customers, and property and equipment, net by location are presented below.

Revenues by Product

Product revenues, net consisted of the following:



	2018 (as reported under ASC 606)		2017 (as reported under ASC 605)		2016 (as reported under ASC 605)
	(in thousands)
SYMDEKO/SYMKEVI	$	768,657	$	—	$	—
ORKAMBI	1,262,166		1,320,850		979,590
KALYDECO	1,007,502		844,630		703,432
Other	—		—		610
Total product revenues, net	$	3,038,325	$	2,165,480	$	1,683,632

Revenues by Geographic Location

Net product revenues are attributed to countries based on the location of the customer. Collaborative and royalty revenues are attributed to countries based on the location of the Company’s subsidiary associated with the collaborative arrangement related to such revenues. Total revenues from external customers and collaborators by geographic region consisted of the following:



	2018 (as reported under ASC 606)		2017 (as reported under ASC 605)		2016 (as reported under ASC 605)
	(in thousands)
United States	$	2,365,079	$	1,986,786	$	1,321,807
Outside of the United States
Europe	543,179		420,317		320,456
Other	139,339		81,549		59,914
Total revenues outside of the United States	682,518		501,866		380,370
Total revenues	$	3,047,597	$	2,488,652	$	1,702,177

In 2018, 2017 and 2016, revenues attributable to Germany and the United Kingdom contributed the largest amounts to the Company’s European revenues.

Significant Customers

Gross revenues and accounts receivable from each of the Company’s customers who individually accounted for 10% or more of total gross revenues and/or 10% or more of total gross accounts receivable consisted of the following:



	Percent of Total Gross Revenues						Percent of Gross Accounts Receivable
	Year Ended December 31,						As of December 31,
	2018 (as reported under ASC 606)		2017 (as reported under ASC 605)		2016 (as reported under ASC 605)		2018		2017
Walgreen Co.	20	%	17	%	19	%	16	%	20	%
Accredo/Curascript	14	%	14	%	15	%	10	%	12	%
McKesson Corporation	14	%	<10	%	<10	%	16	%	<10	%
CVS/Caremark	n/a		<10	%	19	%	n/a		n/a

Property and Equipment, Net by Location

Property and equipment, net by location consisted of the following:



	As of December 31,
	2018		2017
	(in thousands)
United States	$	778,157	$	753,128
Outside of the United States
United Kingdom	30,496		31,279
Other	3,352		5,030
Total property and equipment, net outside of the United States	33,848		36,309
Total property and equipment, net	$	812,005	$	789,437

Quarterly Financial Data (unaudited)

12 Months Ended

Dec. 31, 2018

Quarterly Financial Information Disclosure [Abstract]

Quarterly Financial Data (unaudited)

The following table sets forth the Company’s quarterly financial data for the two years ended December 31, 2018.



	Three Months Ended
	March 31, 2018			June 30, 2018			September 30, 2018			December 31, 2018
	(in thousands, except per share amounts)
Revenues:
Product revenues, net	$	637,729		$	749,912		$	782,511		$	868,173
Collaborative and royalty revenues	3,070			2,245			2,024			1,933
Total revenues	640,799			752,157			784,535			870,106
Costs and expenses:
Cost of sales	71,613			104,382			111,255			122,289
Research and development expenses (1)	310,553			337,532			330,510			437,881
Sales, general and administrative expenses	129,808			137,303			137,295			153,210
Restructuring (income) expenses	(76		)	62			(174		)	4
Intangible asset impairment charge (2)	—			—			—			29,000
Total costs and expenses	511,898			579,279			578,886			742,384
Income from operations	128,901			172,878			205,649			127,722
Interest expense, net	(11,097		)	(10,106		)	(8,143		)	(4,773		)
Other income (expense), net (3)	96,838			53,819			(60,995		)	(90,452		)
Income before (benefit from) provision for income taxes	214,642			216,591			136,511			32,497
(Benefit from) provision for income taxes (4)	(12,659		)	10,341			8,055			(1,492,599		)
Net income	227,301			206,250			128,456			1,525,096
(Income) loss attributable to noncontrolling interest	(17,038		)	1,110			290			25,431
Net income attributable to Vertex	$	210,263		$	207,360		$	128,746		$	1,550,527

Amounts per share attributable to Vertex common shareholders:
Net income:
Basic	$	0.83		$	0.82		$	0.51		$	6.08
Diluted	$	0.81		$	0.80		$	0.50		$	5.97
Shares used in per share calculations:
Basic	253,231			254,135			254,905			254,868
Diluted	258,526			258,584			259,788			259,812



	Three Months Ended
	March 31, 2017			June 30, 2017			September 30, 2017			December 31, 2017
	(in thousands, except per share amounts)
Revenues:
Product revenues, net	$	480,622		$	513,988		$	549,642		$	621,228
Collaborative and royalty revenues (5)	234,096			30,147			28,523			30,406
Total revenues	714,718			544,135			578,165			651,634
Costs and expenses:
Cost of sales	46,988			71,205			72,874			84,052
Research and development expenses (6)	273,563			289,451			454,947			306,664
Sales, general and administrative expenses	113,326			127,249			120,710			134,794
Restructuring expenses	9,999			3,523			337			387
Intangible asset impairment charge (7)	—			—			255,340			—
Total costs and expenses	443,876			491,428			904,208			525,897
Income (loss) from operations	270,842			52,707			(326,043		)	125,737
Interest expense, net	(16,765		)	(14,664		)	(13,574		)	(12,547		)
Other expense, net (7)	(544		)	(2,537		)	(77,553		)	(748		)
Income (loss) before provision for (benefit from) income taxes	253,533			35,506			(417,170		)	112,442
Provision for (benefit from) income taxes (7)	3,985			4,337			(125,903		)	10,257
Net income (loss)	249,548			31,169			(291,267		)	102,185
(Income) loss attributable to noncontrolling interest (7)	(1,792		)	(13,173		)	188,315			(1,501		)
Net income (loss) attributable to Vertex	$	247,756		$	17,996		$	(102,952	)	$	100,684

Amounts per share attributable to Vertex common shareholders:
Net income (loss):
Basic	$	1.01		$	0.07		$	(0.41	)	$	0.40
Diluted	$	0.99		$	0.07		$	(0.41	)	$	0.39
Shares used in per share calculations:
Basic	246,024			247,521			250,268			251,557
Diluted	248,700			251,635			250,268			256,804


1.	In the fourth quarter of 2018, the Company incurred research and development expenses of $95.0 million to related license agreements with Merck KGaA, Darmstadt, Germany, and Arbor. See Note B, “Collaborative Arrangements and Acquisitions.”


2.	In the fourth quarter of 2018, the Company recorded a $29.0 million intangible asset impairment charge related to its VX-210 indefinite-lived in-process research and development asset. See Note J, “Intangible Assets and Goodwill.”


3.	In 2018, other income (expense), net was primarily related to changes in the fair value of the Company’s equity investment in CRISPR. See Note E, “Marketable Securities and Equity Investments.”


4.	In the fourth quarter of 2018, the Company released the valuation allowance on the majority of its net operating losses and other deferred tax assets as of December 31, 2018 resulting in a benefit from income taxes of $1.56 billion. See Note O, “Income Taxes.”

In the first quarter of 2017, the Company recognized $230.0 million of collaborative revenues related to an upfront payment from Merck KGaA, Darmstadt, Germany, pursuant to a collaboration. In each of the second and third quarters of 2017, the Company recognized $20.0 million of collaborative revenues related to payments that Parion, which was a variable interest entity during these periods, received from Shire pursuant to a license agreement. In the fourth quarter of 2017, the Company recognized $25.0 million of collaborative revenues related to a milestone achieved pursuant to its license agreement with Janssen pursuant to which Janssen is developing pimodivir for the treatment of influenza. See Note B, “Collaborative Arrangements and Acquisitions.”


6.	In the third quarter of 2017, the Company incurred research and development expenses of $160.0 million to acquire certain CF assets including VX-561 from Concert. See Note B, “Collaborative Arrangements and Acquisitions.”

In the third quarter of 2017, the Company recorded a $255.3 million intangible asset impairment charge related to Parion’s pulmonary ENaC platform indefinite-lived in-process research and development asset, a decrease in the fair value of the contingent payments payable by the Company to Parion of $69.6 million and benefit from income taxes of $126.2 million resulting from these charges. These charges and benefit from income taxes were attributable to noncontrolling interest. See Note B, “Collaborative Arrangements and Acquisitions,” and Note J, “Intangible Assets and Goodwill.”

Nature of Business and Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2018

Accounting Policies [Abstract]

Basis of Presentation

Use of Estimates

Revenue Recognition

Product Revenues, Net

The Company excludes taxes collected from Customers relating to product sales and remitted to governmental authorities from revenues.

Contract Liabilities

French Early Access Programs

Collaborative and Royalty Revenues

Concentration of Credit Risk

Cash and Cash Equivalents

The Company considers all highly liquid investments with original maturities of three months or less at the date of purchase to be cash equivalents.

Marketable Securities

Realized gains and losses are determined using the specific identification method and are included in “Other (expense) income, net” in the consolidated statements of operations.

Accounts Receivable

Stock-based Compensation Expense

Research and Development Expenses

Advertising Expenses

The Company expenses the costs of advertising, including promotional expenses, as incurred.

Inventories

Property and Equipment

Capital Leases

Income Taxes

Variable Interest Entities

Fair Value of In-process Research and Development Assets and Contingent Payments

In-process Research and Development Assets

Goodwill

Noncontrolling Interest

Deconsolidation and Discounted Operations

Deconsolidation and Discontinued Operations

Derivative Instruments, Embedded Derivatives and Hedging Activities

Derivative Instruments and Embedded Derivatives

Hedging Activities

Restructuring Expenses

Comprehensive Income (Loss)

Foreign Currency Translation and Transactions

Net Loss Per Share Attributable to Vertex Common Stockholders

Net Loss Per Share Attributable to Vertex Common Shareholders

Recent Accounting Pronouncements

Recently Adopted Accounting Pronouncements

Revenue Recognition

The cumulative effect of applying ASC 606 to the Company’s contracts with customers that were not completed as of January 1, 2018 was as follows:



	Balance as of						Balance as of
	December 31, 2017			Adjustments			January 1, 2018
Assets	(in thousands)
Accounts receivable, net	$	281,343		$	29,881		$	311,224
Inventories	111,830			(90		)	111,740
Prepaid expenses and other current assets	167,124			(17,166		)	149,958
Total assets	$	3,546,014		$	12,625		$	3,558,639
Liabilities and Shareholders’ Equity
Accrued expenses	$	443,961		$	8,586		$	452,547
Early access sales accrual	232,401			(7,273		)	225,128
Other liabilities, current portion	34,373			2,083			36,456
Accumulated other comprehensive income (loss)	(11,572		)	949			(10,623		)
Accumulated deficit	(5,119,723		)	8,280			(5,111,443		)
Total liabilities and shareholders’ equity	$	3,546,014		$	12,625		$	3,558,639

The impact of adoption on the Company’s consolidated balance sheet as of December 31, 2018 was as follows:



	As of December 31, 2018
	As Reported under ASC 606			Balances without Adoption of ASC 606			Effect of Change Higher/(Lower)
Assets	(in thousands)
Accounts receivable, net	$	409,688		$	376,949		$	32,739
Inventories	124,360			124,506			(146		)
Prepaid expenses and other current assets	140,819			167,522			(26,703		)
Total assets	$	6,245,898		$	6,240,008		$	5,890
Liabilities and Shareholders’ Equity
Accrued expenses	$	604,495		$	618,873		$	(14,378	)
Early access sales accrual	354,404			380,609			(26,205		)
Other liabilities, current portion	40,589			14,355			26,234
Accumulated other comprehensive income (loss)	659			927			(268		)
Accumulated deficit	(2,989,478		)	(3,009,985		)	20,507
Total liabilities and shareholders’ equity	$	6,245,898		$	6,240,008		$	5,890

The impact of adoption on the Company’s consolidated statement of operations for the year ended December 31, 2018 was as follows:



	Year Ended December 31, 2018
	As Reported under ASC 606		Balances without Adoption of ASC 606		Effect of Change Higher/(Lower)
	(in thousands)
Product revenues, net	$	3,038,325	$	3,019,484	$	18,841
Cost of sales	409,539		402,925		6,614
Income from operations	635,150		622,923		12,227
Net income attributable to Vertex	$	2,096,896	$	2,084,669	$	12,227

Amounts per share attributable to Vertex common shareholders:
Net income:
Basic	$	8.24	$	8.20	$	0.04
Diluted	$	8.09	$	8.04	$	0.05

Equity Investments

Intra-Entity Transfers

Goodwill

Stock-Based Compensation - Modifications

Cash Flows - Restricted Cash



	As of December 31,
	2018		2017		2016		2015
	(in thousands)
Cash and cash equivalents	$	2,650,134	$	1,665,412	$	1,183,945	$	714,768
Prepaid expenses and other current assets	4,910		2,114		47,762		78,910
Other assets	3,209		—		—		22,083
Cash, cash equivalents and restricted cash per statement of cash flows	$	2,658,253	$	1,667,526	$	1,231,707	$	815,761

Stock-Based Compensation - Improvements

Recently Issued Accounting Standards

Leases

Derivatives and Hedging

Internal-Use Software

Fair Value Measurement

Nature of Business and Accounting Policies Nature of Business and Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2018

Accounting Policies [Abstract]

Schedule of New Accounting Pronouncements and Changes in Accounting Principles

The cumulative effect of applying ASC 606 to the Company’s contracts with customers that were not completed as of January 1, 2018 was as follows:



	Balance as of						Balance as of
	December 31, 2017			Adjustments			January 1, 2018
Assets	(in thousands)
Accounts receivable, net	$	281,343		$	29,881		$	311,224
Inventories	111,830			(90		)	111,740
Prepaid expenses and other current assets	167,124			(17,166		)	149,958
Total assets	$	3,546,014		$	12,625		$	3,558,639
Liabilities and Shareholders’ Equity
Accrued expenses	$	443,961		$	8,586		$	452,547
Early access sales accrual	232,401			(7,273		)	225,128
Other liabilities, current portion	34,373			2,083			36,456
Accumulated other comprehensive income (loss)	(11,572		)	949			(10,623		)
Accumulated deficit	(5,119,723		)	8,280			(5,111,443		)
Total liabilities and shareholders’ equity	$	3,546,014		$	12,625		$	3,558,639

The impact of adoption on the Company’s consolidated balance sheet as of December 31, 2018 was as follows:



	As of December 31, 2018
	As Reported under ASC 606			Balances without Adoption of ASC 606			Effect of Change Higher/(Lower)
Assets	(in thousands)
Accounts receivable, net	$	409,688		$	376,949		$	32,739
Inventories	124,360			124,506			(146		)
Prepaid expenses and other current assets	140,819			167,522			(26,703		)
Total assets	$	6,245,898		$	6,240,008		$	5,890
Liabilities and Shareholders’ Equity
Accrued expenses	$	604,495		$	618,873		$	(14,378	)
Early access sales accrual	354,404			380,609			(26,205		)
Other liabilities, current portion	40,589			14,355			26,234
Accumulated other comprehensive income (loss)	659			927			(268		)
Accumulated deficit	(2,989,478		)	(3,009,985		)	20,507
Total liabilities and shareholders’ equity	$	6,245,898		$	6,240,008		$	5,890

The impact of adoption on the Company’s consolidated statement of operations for the year ended December 31, 2018 was as follows:



	Year Ended December 31, 2018
	As Reported under ASC 606		Balances without Adoption of ASC 606		Effect of Change Higher/(Lower)
	(in thousands)
Product revenues, net	$	3,038,325	$	3,019,484	$	18,841
Cost of sales	409,539		402,925		6,614
Income from operations	635,150		622,923		12,227
Net income attributable to Vertex	$	2,096,896	$	2,084,669	$	12,227

Amounts per share attributable to Vertex common shareholders:
Net income:
Basic	$	8.24	$	8.20	$	0.04
Diluted	$	8.09	$	8.04	$	0.05

Schedule of Cash and Cash Equivalents

The cash, cash equivalents and restricted cash balances for the years ended December 31, 2018 through 2015, which are presented in the Company’s consolidated statements of cash flows subsequent to the adoption of ASU 2016-18, consisted of the following:



	As of December 31,
	2018		2017		2016		2015
	(in thousands)
Cash and cash equivalents	$	2,650,134	$	1,665,412	$	1,183,945	$	714,768
Prepaid expenses and other current assets	4,910		2,114		47,762		78,910
Other assets	3,209		—		—		22,083
Cash, cash equivalents and restricted cash per statement of cash flows	$	2,658,253	$	1,667,526	$	1,231,707	$	815,761

Collaborative Arrangements (Tables)

12 Months Ended

Dec. 31, 2018

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of collaborative arrangement activity net loss attributable to noncontrolling interest

An aggregate summary of net loss attributable to noncontrolling interest related to the Company’s VIEs for the three years ended December 31, 2018 was as follows:



	2018			2017			2016
	(in thousands)
Loss attributable to noncontrolling interest before (benefit from) provision for income taxes and changes in fair value of contingent payments	$	31,191		$	223,379		$	10,086
(Benefit from) provision for income taxes	(3,668		)	(114,090		)	16,743
(Increase) decrease in fair value of contingent payments	(17,730		)	62,560			(54,850		)
Net loss (income) attributable to noncontrolling interest	$	9,793		$	171,849		$	(28,021	)

Schedule of changes in fair value of contingent payments

During three years ended December 31, 2018, the (increases) decreases in the fair value of the contingent payments related to the Company’s VIEs were as follows:



	2018			2017			2016
	(in thousands)
Parion	$	—		$	63,460		$	(64,800	)
BioAxone	(17,730		)	(900		)	9,950

Schedule of collaborative arrangement summary of items related to variable interest entities



	December 31, 2017
	(in thousands)
Intangible assets	$	29,000
Deferred tax liabilities	4,756
Noncontrolling interest	13,727

Earnings Per Share (Tables)

12 Months Ended

Dec. 31, 2018

Earnings Per Share [Abstract]

Schedule of earning per share, basic and diluted, by common shares

The following table sets forth the computation of basic and diluted net income (loss) per share for three years ended December 31, 2018:



	2018			2017			2016
	(in thousands, except per share amounts)
Basic net income (loss) attributable to Vertex per common share calculation:
Net income (loss) attributable to Vertex common shareholders	$	2,096,896		$	263,484		$	(112,052	)
Less: Undistributed earnings allocated to participating securities	(501		)	(293		)	—
Net income (loss) attributable to Vertex common shareholders—basic	$	2,096,395		$	263,191		$	(112,052	)

Basic weighted-average common shares outstanding	254,292			248,858			244,685
Basic net income (loss) attributable to Vertex per common share	$	8.24		$	1.06		$	(0.46	)

Diluted net income (loss) attributable to Vertex per common share calculation:
Net income (loss) attributable to Vertex common shareholders	$	2,096,896		$	263,484		$	(112,052	)
Less: Undistributed earnings allocated to participating securities	(492		)	(288		)	—
Net income (loss) attributable to Vertex common shareholders—diluted	$	2,096,404		$	263,196		$	(112,052	)

Weighted-average shares used to compute basic net income (loss) per common share	254,292			248,858			244,685
Effect of potentially dilutive securities:
Stock options	2,913			2,797			—
Restricted stock and restricted stock units (including PSUs)	1,963			1,542			—
Employee stock purchase plan	17			28			—
Weighted-average shares used to compute diluted net income (loss) per common share	259,185			253,225			244,685
Diluted net income (loss) attributable to Vertex per common share	$	8.09		$	1.04		$	(0.46	)

Schedule of antidilutive securities excluded from computation of earnings per share



	2018	2017	2016
	(in thousands)
Stock options	2,217	3,554	12,642
Unvested restricted stock and restricted stock units (including PSUs)	5	411	3,546

Fair Value Measurements (Tables)

12 Months Ended

Dec. 31, 2018

Fair Value Disclosures [Abstract]

Financial assets and liabilities subject to fair value measurements (excluding restricted cash and cash equivalents (VIE))

The following table sets forth the Company’s financial assets and liabilities (excluding VIE cash and cash equivalents) subject to fair value measurements:



	Fair Value Measurements as of December 31, 2018
				Fair Value Hierarchy
	Total			Level 1		Level 2			Level 3
	(in thousands)
Financial instruments carried at fair value (asset position):
Cash equivalents:
Money market funds	$	1,226,603		$	1,226,603	$	—		$	—
U.S. Treasury securities	5,966			5,966		—			—
Government-sponsored enterprise securities	7,123			7,123		—			—
Commercial paper	58,268			—		58,268			—
Marketable securities:
Corporate equity securities	167,323			153,733		13,590			—
U.S. Treasury securities	6,026			6,026		—			—
Government-sponsored enterprise securities	10,704			10,704		—			—
Corporate debt securities	233,665			—		233,665			—
Commercial paper	100,390			—		100,390			—
Prepaid and other current assets:
Foreign currency forward contracts	19,023			—		19,023			—
Other assets:
Foreign currency forward contracts	1,514			—		1,514			—
Total financial assets	$	1,836,605		$	1,410,155	$	426,450		$	—
Financial instruments carried at fair value (liability position):
Other liabilities, current portion:
Foreign currency forward contracts	$	(340	)	$	—	$	(340	)	$	—
Other liabilities, excluding current portion:
Foreign currency forward contracts	(108		)	—		(108		)	—
Total financial liabilities	$	(448	)	$	—	$	(448	)	$	—



	Fair Value Measurements as of December 31, 2017
				Fair Value Hierarchy
	Total			Level 1		Level 2			Level 3
	(in thousands)
Financial instruments carried at fair value (asset position):
Cash equivalents:
Money market funds	$	614,951		$	614,951	$	—		$	—
Government-sponsored enterprise securities	12,678			12,678		—			—
Commercial paper	57,357			—		57,357			—
Marketable securities:
Corporate equity securities	74,821			74,821		—			—
Government-sponsored enterprise securities	2,303			2,303		—			—
Corporate debt securities	265,867			—		265,867			—
Commercial paper	80,263			—		80,263			—
Prepaid and other current assets:
Foreign currency forward contracts	13			—		13			—
Total financial assets	$	1,108,253		$	704,753	$	403,500		$	—
Financial instruments carried at fair value (liability position):
Other liabilities, current portion:
Foreign currency forward contracts	$	(13,642	)	$	—	$	(13,642	)	$	—
Other liabilities, excluding current portion:
Foreign currency forward contracts	(866		)	—		(866		)	—
Total financial liabilities	$	(14,508	)	$	—	$	(14,508	)	$	—

Marketable Securities and Equity Investments (Tables)

12 Months Ended

Dec. 31, 2018

Cash and Cash Equivalents [Abstract]

Summary of cash, cash equivalents and marketable securities

A summary of the Company’s cash equivalents and marketable securities is shown below:



	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
	(in thousands)
As of December 31, 2018
Cash equivalents:
Money market funds	$	1,226,603	$	—	$	—		$	1,226,603
U.S. Treasury securities	5,967		—		(1		)	5,966
Government-sponsored enterprise securities	7,124		—		(1		)	7,123
Commercial paper	58,271		—		(3		)	58,268
Total cash equivalents	1,297,965		—		(5		)	1,297,960
Marketable securities:
U.S Treasury securities (matures within 1 year)	6,026		—		—			6,026
Government-sponsored enterprise securities (matures within 1 year)	10,704		—		—			10,704
Corporate debt securities (matures within 1 year)	232,845		25		(450		)	232,420
Corporate debt securities (matures after 1 year through 5 years)	1,243		2		—			1,245
Commercial paper (matures within 1 year)	100,498		—		(108		)	100,390
Total marketable debt securities	351,316		27		(558		)	350,785
Corporate equity securities	133,157		40,619		(6,453		)	167,323
Total marketable securities	$	484,473	$	40,646	$	(7,011	)	$	518,108

As of December 31, 2017
Cash equivalents:
Money market funds	$	614,951	$	—	$	—		$	614,951
Government-sponsored enterprise securities	12,679		—		(1		)	12,678
Commercial paper	57,371		—		(14		)	57,357
Total cash equivalents	685,001		—		(15		)	684,986
Marketable securities:
Government-sponsored enterprise securities (matures within 1 year)	2,304		—		(1		)	2,303
Corporate debt securities (matures within 1 year)	215,639		—		(363		)	215,276
Corporate debt securities (matures after 1 year through 5 years)	50,697		—		(106		)	50,591
Commercial paper (matures within 1 year)	80,372		—		(109		)	80,263
Total marketable debt securities	349,012		—		(579		)	348,433
Available-for-sale corporate equity securities	43,213		31,608		—			74,821
Total marketable securities	$	392,225	$	31,608	$	(579	)	$	423,254

Available-for-sale debt securities were recorded in the Company's consolidated balance sheets as follows:



	As of December 31,
	2018		2017
	(in thousands)
Cash and cash equivalents	$	1,297,960	$	684,986
Marketable securities	350,785		348,433
Total	$	1,648,745	$	1,033,419

Accumulated Other Comprehensive Income (Loss) (Tables)

12 Months Ended

Dec. 31, 2018

Equity [Abstract]

Schedule of Reclassifications out of Accumulated Other Comprehensive Income (Loss)

The following table summarizes the changes in accumulated other comprehensive income (loss) by component:



				Unrealized Holding Gains (Losses), Net of Tax
	Foreign Currency Translation Adjustment			On Available-For-Sale Debt Securities			On Equity Securities			On Foreign Currency Forward Contracts			Total
	(in thousands)
Balance at December 31, 2015	$	(2,080	)	$	126		$	—		$	3,778		$	1,824
Other comprehensive (loss) income before reclassifications	(5,782		)	(136		)	17,531			17,383			28,996
Amounts reclassified from accumulated other comprehensive income (loss)	—			—			—			(9,647		)	(9,647		)
Net current period other comprehensive (loss) income	(5,782		)	(136		)	17,531			7,736			19,349
Balance at December 31, 2016	$	(7,862	)	$	(10	)	$	17,531		$	11,514		$	21,173
Other comprehensive (loss) income before reclassifications	(13,169		)	(584		)	7,538			(29,175		)	(35,390		)
Amounts reclassified from accumulated other comprehensive income (loss)	—			—			—			2,645			2,645
Net current period other comprehensive (loss) income	(13,169		)	(584		)	7,538			(26,530		)	(32,745		)
Balance as of December 31, 2017	$	(21,031	)	$	(594	)	$	25,069		$	(15,016	)	$	(11,572	)
Other comprehensive income before reclassifications	8,855			58			—			25,664			34,577
Amounts reclassified from accumulated other comprehensive income (loss)	—			—			—			1,774			1,774
Net current period other comprehensive income	8,855			58			—			27,438			36,351
Amounts reclassified to accumulated deficit pursuant to adoption of new accounting standard	949			—			(25,069		)	—			(24,120		)
Balance as of December 31, 2018	$	(11,227	)	$	(536	)	$	—		$	12,422		$	659

Hedging (Tables)

12 Months Ended

Dec. 31, 2018

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Cash Flow Hedging Instruments

The following table summarizes the notional amount of the Company’s outstanding foreign currency forward contracts designated as cash flow hedges under GAAP:



	As of December 31,
	2018		2017
Foreign Currency	(in thousands)
Euro	$	335,179	$	257,230
British pound sterling	73,460		77,481
Australian dollar	52,820		30,501
Canadian dollar	43,759		—
Total foreign currency forward contracts	$	505,218	$	365,212

Derivative Instruments, Gain (Loss)

During the three years ended December 31, 2018, the Company recognized the following related to foreign currency forward contacts in its consolidated statements of operations:



	December 31,
	2018			2017		2016
	(in thousands)
Designated as hedging instruments - Reclassified from AOCI
Product revenues, net	$	(1,252	)	$	768	$	10,543
Not designated as hedging instruments
Other (expense) income, net	$	623		$	14,129	$	(6,917	)

Schedule of Foreign Exchange Contracts

The following table summarizes the fair value of the Company’s outstanding foreign currency forward contracts designated as cash flow hedges under GAAP included on its consolidated balance sheets:



As of December 31, 2018
Assets			Liabilities
Classification	Fair Value		Classification	Fair Value
(in thousands)
Prepaid and other current assets	$	19,023	Other liabilities, current portion	$	(340	)
Other assets	1,514		Other liabilities, excluding current portion	(108		)
Total assets	$	20,537	Total liabilities	$	(448	)



As of December 31, 2017
Assets			Liabilities
Classification	Fair Value		Classification	Fair Value
(in thousands)
Prepaid and other current assets	$	13	Other liabilities, current portion	$	(13,642	)
Other assets	—		Other liabilities, excluding current portion	(866		)
Total assets	$	13	Total liabilities	$	(14,508	)

Derivatives Offsetting

The following table summarizes the potential effect of offsetting derivatives by type of financial instrument designated as cash flow hedges under GAAP on the Company’s consolidated balance sheets:



	As of December 31, 2018
	Gross Amounts Recognized			Gross Amounts Offset		Gross Amounts Presented			Gross Amounts Not Offset			Legal Offset
Foreign currency forward contracts	(in thousands)
Total assets	$	20,537		$	—	$	20,537		$	(448	)	$	20,089
Total liabilities	(448		)	—		(448		)	448			—



	As of December 31, 2017
	Gross Amounts Recognized			Gross Amounts Offset		Gross Amounts Presented			Gross Amounts Not Offset			Legal Offset
Foreign currency forward contracts	(in thousands)
Total assets	$	13		$	—	$	13		$	(13	)	$	—
Total liabilities	(14,508		)	—		(14,508		)	13			(14,495		)

Inventories (Tables)

12 Months Ended

Dec. 31, 2018

Inventory Disclosure [Abstract]

Schedule of Inventories by Type

Inventories consisted of the following:



	As of December 31,
	2018		2017
	(in thousands)
Raw materials	$	9,677	$	20,924
Work-in-process	87,944		74,237
Finished goods	26,739		16,669
Total	$	124,360	$	111,830

Property and Equipment (Tables)

12 Months Ended

Dec. 31, 2018

Property, Plant and Equipment [Abstract]

Schedule of Property and equipment

Property and equipment, net consisted of the following:



	As of December 31,
	2018			2017
	(in thousands)
Buildings	$	657,438		$	634,061
Furniture and equipment	280,908			256,509
Software	162,601			151,890
Leasehold improvements	103,428			117,806
Computers	59,073			61,294
Total property and equipment, gross	1,263,448			1,221,560
Less: accumulated depreciation	(451,443		)	(432,123		)
Total property and equipment, net	$	812,005		$	789,437

Additional Balance Sheet Detail (Tables)

12 Months Ended

Dec. 31, 2018

Payables and Accruals [Abstract]

Summary of Prepaid and other current assets

Prepaid and other current assets consisted of the following:



	As of December 31,
	2018		2017
	(in thousands)
Prepaid expenses	$	74,045	$	62,475
Collaborative accounts receivable	5,182		28,907
Other receivables and assets	61,592		75,742
Total	$	140,819	$	167,124

Summary of Accrued expenses and other current liabilities

Accrued expenses consisted of the following:



	As of December 31,
	2018		2017
	(in thousands)
Payroll and benefits	$	124,753	$	113,026
Research, development and commercial contract costs	115,300		98,411
Product revenue allowances	195,598		119,919
Royalty payable	101,108		73,044
Other	67,736		39,561
Total	$	604,495	$	443,961

Long Term Obligations Long Term Obligations (Tables)

12 Months Ended

Dec. 31, 2018

Debt Disclosure [Abstract]

Financing Lease Obligations



	As of December 31,
	2018		2017
	(in thousands)
Property and equipment, net
Fan Pier Buildings	$	462,863	$	475,725
San Diego Building	$	113,296	$	94,602

Construction financing lease obligation
Fan Pier Buildings	$	471,058	$	472,070
San Diego Building	$	96,105	$	87,392

Common Stock, Preferred Stock and Equity Plans (Tables)

12 Months Ended

Dec. 31, 2018

Equity [Abstract]

Schedule of stock and stock equity plans

The following table contains information about the Company’s equity plans:



			As of December 31, 2018
Title of Plan	Group Eligible	Type of Award Granted	Awards Outstanding	Additional Awards Authorized for Grant
2013 Stock and Option Plan	Employees, Non-employee Directors and Consultants	NSO, RS, RSU and PSU	10,735,107	14,737,360
2006 Stock and Option Plan	Employees, Non-employee Directors and Consultants	NSO, RS and RSU	1,770,994	—
		Total	12,506,101	14,737,360

Outstanding and vested options

The following table summarizes information related to the outstanding and exercisable options during the year ended December 31, 2018:



	Stock Options		Weighted-average Exercise Price		Weighted-average Remaining Contractual Life	Aggregate Intrinsic Value
	(in thousands)		(per share)		(in years)	(in thousands)
Outstanding at December 31, 2017	9,767		$	91.57
Granted	2,297		$	164.11
Exercised	(3,076	)	$	85.66
Forfeited	(431	)	$	125.37
Expired	(6	)	$	98.30
Outstanding at December 31, 2018	8,551		$	111.46	6.92	$	462,563
Exercisable at December 31, 2018	4,577		$	93.21	5.63	$	325,382

Stock options outstanding and exercisable

The following table summarizes information about stock options outstanding and exercisable at December 31, 2018:



	Options Outstanding				Options Exercisable
Range of Exercise Prices	Number Outstanding	Weighted-average Remaining Contractual Life	Weighted-average Exercise Price		Number Exercisable	Weighted-average Exercise Price
	(in thousands)	(in years)	(per share)		(in thousands)	(per share)
$29.07–$40.00	532	1.08	$	34.89	532	$	35.89
$40.01–$60.00	470	3.51	$	50.04	470	$	50.04
$60.01–$80.00	543	5.25	$	74.90	533	$	74.89
$80.01–$100.00	2,839	7.18	$	89.19	1320	$	89.85
$100.01–$120.00	693	6.09	$	109.30	603	$	109.22
$120.01–$140.00	839	6.62	$	130.27	642	$	130.24
$140.01–$160.00	1,400	9.06	$	155.52	271	$	155.30
$160.01–$180.00	526	8.50	$	162.94	156	$	162.94
$180.01–$181.60	709	9.53	$	181.60	50	$	181.60
Total	8,551	6.92	$	111.46	4,577	$	93.21

Restricted stock and restricted stock units activity

The following table summarizes the restricted stock and restricted stock unit activity of the Company during the year ended December 31, 2018:



	Restricted Stock				Restricted Stock Units (excluding PSUs)
	Number of Units		Weighted-average Grant-date Fair Value		Number of Shares		Weighted-average Grant-date Fair Value
	(in thousands)		(per share)		(in thousands)		(per share)
Unvested at December 31, 2017	1,229		$	102.12	2,011		$	109.27
Granted	—		$	—	1,600		$	164.70
Vested	(690	)	$	100.07	(629	)	$	108.02
Cancelled	(59	)	$	101.55	(265	)	$	132.26
Unvested at December 31, 2018	480		$	104.91	2,717		$	140.10

PSU activity

The following table summarizes the PSU activity of the Company during the year ended December 31, 2018:



	Performance-Based RSU
	Number of Units		Weighted-average Grant-date Fair Value
	(in thousands)		(per share)
Unvested at December 31, 2017 (1)	484		$	87.59
Granted (2)	494		$	152.40
Vested	(154	)	$	87.13
Cancelled	(65	)	$	99.34
Unvested at December 31, 2018	759		$	110.50

(1) “Unvested” represents the Company’s PSUs at target to the extent performance has not been certified plus the actual number of shares that continue to be subject to service conditions for which the performance has been achieved and certified.
(2) “Granted” represents (i) the target number of shares issuable for grants during 2018 and (ii) any change in the number of shares issuable pursuant to outstanding PSUs based on performance certification during 2018.

Shares issued under Employee Stock Purchase Plan

In 2018, the following shares were issued to employees under the ESPP:



	Year Ended December 31, 2018
	(in thousands, except per share amount)
Number of shares	213,654
Average price paid per share	$	117.52

Stock-based Compensation Expense (Tables)

12 Months Ended

Dec. 31, 2018

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock-based compensation expense by line item

The effect of stock-based compensation expense during the three years ended December 31, 2018 was as follows:



	2018		2017		2016
	(in thousands)
Stock-based compensation expense by line item:
Cost of sales	$	4,543	$	2,500	$	2,918
Research and development expenses	203,112		181,900		153,451
Sales, general and administrative expenses	117,392		108,836		84,254
Total stock-based compensation expense included in costs and expenses	$	325,047	$	293,236	$	240,623

Stock-based compensation expense by type of award

The stock-based compensation expense by type of award during the three years ended December 31, 2018 was as follows:



	2018			2017			2016
	(in thousands)
Stock-based compensation expense by type of award:
Stock options	$	107,854		$	105,367		$	114,768
Restricted stock and restricted stock units (including PSUs)	207,845			181,258			118,709
ESPP share issuances	9,933			9,017			7,835
Stock-based compensation expense related to inventories	(585		)	(2,406		)	(689		)
Total stock-based compensation expense included in costs and expenses	$	325,047		$	293,236		$	240,623

Unrecognized stock-based compensation expense, net of estimated forfeitures



	As of December 31, 2018
	Unrecognized Expense		Weighted-average Recognition Period
	(in thousands)		(in years)
Type of award:
Stock options	$	155,465	2.64
Restricted stock and restricted stock units (including PSUs)	$	321,683	2.58
ESPP share issuances	$	5,132	0.58

Schedule of assumptions used to estimate the grant date fair value of options

The fair value of each option granted during 2018, 2017 and 2016 was estimated on the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions:



	2018		2017		2016
Expected stock price volatility	40.50	%	45.31	%	46.77	%
Risk-free interest rate	2.61	%	1.94	%	1.32	%
Expected term of options (in years)	4.55		4.68		4.91
Expected annual dividends	—		—		—

Schedule of assumptions used to estimate the grant date fair value employee stock purchase plan

The following table reflects the weighted-average assumptions used in the Black-Scholes option pricing model for 2018, 2017 and 2016:



	2018		2017		2016
Expected stock price volatility	36.51	%	39.09	%	48.22	%
Risk-free interest rate	2.36	%	1.24	%	0.56	%
Expected term (in years)	0.75		0.75		0.75
Expected annual dividends	—		—		—

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2018

Income Tax Disclosure [Abstract]

Schedule of components of income (loss) before provision for (benefit from) income taxes

The components of income (loss) before (benefit from) provision for income taxes during the three years ended December 31, 2018 consisted of the following:



	2018			2017			2016
	(in thousands)
United States	$	812,086		$	330,340		$	(147,860	)
Foreign	(211,845		)	(346,029		)	80,494
Income (loss) before (benefit from) provision for income taxes	$	600,241		$	(15,689	)	$	(67,366	)

Schedule of components of provision for (benefit from) income taxes

The components of the (benefit from) provision for income taxes during the three years ended December 31, 2018 consisted of the following:



	2018			2017			2016
	(in thousands)
Current taxes:
United States	$	772		$	11,559		$	(3,821	)
Foreign	15,600			3,576			1,794
State	9,018			5,025			1,836
Total current taxes	25,390			20,160			(191		)
Deferred taxes:
United States	(1,105,053		)	(113,805		)	18,659
Foreign	(364,919		)	(3,222		)	(3,359		)
State	(42,280		)	(10,457		)	1,556
Total deferred taxes	(1,512,252		)	(127,484		)	16,856
(Benefit from) provision for income taxes	$	(1,486,862	)	$	(107,324	)	$	16,665

Reconciliation of the provision for (benefit from) income taxes



	2018			2017			2016
	(in thousands)
Income (loss) before (benefit from) provision for income taxes	$	600,241		$	(15,689	)	$	(67,366	)

Expected provision for (benefit from) income taxes	126,051			(5,491		)	(23,578		)
State taxes, net of federal benefit	8,680			4,742			3,621
Foreign income tax rate differential	23,427			77,801			21,346
Tax credits	(52,629		)	(58,204		)	(47,773		)
(Benefit from) provision for income taxes attributable to valuation allowances	(1,563,169		)	(575,801		)	14,837
Permanent items	1,421			15,324			24,663
Rate change	—			575,192			12,836
Stock compensation (benefit) shortfalls and cancellations	(49,044		)	(21,453		)	4,162
Officer’s compensation	8,310			6,501			86
Tax attribute expiration	—			—			9,947
Deconsolidation of VIE	(9,390		)	(126,183		)	—
Uncertain tax positions	15,431			—			—
Other	4,050			248			(3,482		)
(Benefit from) provision for income taxes	$	(1,486,862	)	$	(107,324	)	$	16,665

Schedule of deferred tax assets and liabilities

The components of the deferred taxes were as follows:



	As of December 31,
	2018			2017
	(in thousands)
Deferred tax assets:
Net operating loss	$	882,014		$	1,004,404
Tax credit carryforwards	487,635			440,429
Intangible assets	241,775			54,091
Deferred revenues	19,311			19,593
Stock-based compensation	93,915			83,196
Accrued expenses	17,795			17,808
Construction financing lease obligation	130,849			109,354
Other	6,831			5,667
Gross deferred tax assets	1,880,125			1,734,542
Valuation allowance	(168,491		)	(1,552,942		)
Total deferred tax assets	1,711,634			181,600
Deferred tax liabilities:
Property and equipment	(128,407		)	(101,019		)
Acquired intangibles	—			(6,341		)
Deferred revenue	(73,357		)	(73,357		)
Unrealized gain	(10,198		)	(6,401		)
Net deferred tax assets (liabilities)	$	1,499,672		$	(5,518	)

Summary of income tax contingencies

Unrecognized tax benefits during the three years ended December 31, 2018 were as follows:



	2018		2017		2016
	(in thousands)
Balance at beginning of the period	$	3,814	$	—	$	425
Increases related to current period tax positions	9,704		3,814		—
Increases related to prior period tax positions	6,031		—		—
Decrease due to statute limitations	—		—		(425		)
Balance at end of period	$	19,549	$	3,814	$	—

Commitments and Contingencies (Tables)

12 Months Ended

Dec. 31, 2018

Commitments and Contingencies Disclosure [Abstract]

Future minimum commitments under Fan Pier Leases and facility operating leases with terms of more than one year, net of estimated sublease income

As of December 31, 2018, future minimum commitments under the facility leases with initial terms of more than one year were as follows:



Year	Fan Pier Leases		San Diego Lease		Other Leases		Total Lease Commitments
	(in thousands)
2019	$	66,540	$	5,324	$	13,207	$	85,071
2020	72,589		9,127		14,270		95,986
2021	72,589		9,127		12,529		94,245
2022	72,589		9,127		12,045		93,761
2023	72,589		9,530		11,952		94,071
Thereafter	389,855		119,864		65,472		575,191
Total minimum lease payments	$	746,751	$	162,099	$	129,475	$	1,038,325

Schedule of future minimum lease payments for capital leases

The following table sets forth the Company’s future minimum payments due under capital leases as of December 31, 2018:



Year	(in thousands)
2019	$	10,770
2020	7,282
2021	5,649
2022	3,300
2023	1,974
Thereafter	3,085
Total payments	32,060
Less: amount representing interest	(2,585		)
Present value of payments	$	29,475

Segment Information (Tables)

12 Months Ended

Dec. 31, 2018

Segment Reporting [Abstract]

Revenues by Product

Product revenues, net consisted of the following:



	2018 (as reported under ASC 606)		2017 (as reported under ASC 605)		2016 (as reported under ASC 605)
	(in thousands)
SYMDEKO/SYMKEVI	$	768,657	$	—	$	—
ORKAMBI	1,262,166		1,320,850		979,590
KALYDECO	1,007,502		844,630		703,432
Other	—		—		610
Total product revenues, net	$	3,038,325	$	2,165,480	$	1,683,632

Revenues and Property and Equipment by Location

Property and equipment, net by location consisted of the following:



	As of December 31,
	2018		2017
	(in thousands)
United States	$	778,157	$	753,128
Outside of the United States
United Kingdom	30,496		31,279
Other	3,352		5,030
Total property and equipment, net outside of the United States	33,848		36,309
Total property and equipment, net	$	812,005	$	789,437

Total revenues from external customers and collaborators by geographic region consisted of the following:



	2018 (as reported under ASC 606)		2017 (as reported under ASC 605)		2016 (as reported under ASC 605)
	(in thousands)
United States	$	2,365,079	$	1,986,786	$	1,321,807
Outside of the United States
Europe	543,179		420,317		320,456
Other	139,339		81,549		59,914
Total revenues outside of the United States	682,518		501,866		380,370
Total revenues	$	3,047,597	$	2,488,652	$	1,702,177

Significant Customers



	Percent of Total Gross Revenues						Percent of Gross Accounts Receivable
	Year Ended December 31,						As of December 31,
	2018 (as reported under ASC 606)		2017 (as reported under ASC 605)		2016 (as reported under ASC 605)		2018		2017
Walgreen Co.	20	%	17	%	19	%	16	%	20	%
Accredo/Curascript	14	%	14	%	15	%	10	%	12	%
McKesson Corporation	14	%	<10	%	<10	%	16	%	<10	%
CVS/Caremark	n/a		<10	%	19	%	n/a		n/a

Quarterly Financial Data (unaudited) (Tables)

12 Months Ended

Dec. 31, 2018

Quarterly Financial Information Disclosure [Abstract]

Schedule of quarterly financial data

The following table sets forth the Company’s quarterly financial data for the two years ended December 31, 2018.



	Three Months Ended
	March 31, 2018			June 30, 2018			September 30, 2018			December 31, 2018
	(in thousands, except per share amounts)
Revenues:
Product revenues, net	$	637,729		$	749,912		$	782,511		$	868,173
Collaborative and royalty revenues	3,070			2,245			2,024			1,933
Total revenues	640,799			752,157			784,535			870,106
Costs and expenses:
Cost of sales	71,613			104,382			111,255			122,289
Research and development expenses (1)	310,553			337,532			330,510			437,881
Sales, general and administrative expenses	129,808			137,303			137,295			153,210
Restructuring (income) expenses	(76		)	62			(174		)	4
Intangible asset impairment charge (2)	—			—			—			29,000
Total costs and expenses	511,898			579,279			578,886			742,384
Income from operations	128,901			172,878			205,649			127,722
Interest expense, net	(11,097		)	(10,106		)	(8,143		)	(4,773		)
Other income (expense), net (3)	96,838			53,819			(60,995		)	(90,452		)
Income before (benefit from) provision for income taxes	214,642			216,591			136,511			32,497
(Benefit from) provision for income taxes (4)	(12,659		)	10,341			8,055			(1,492,599		)
Net income	227,301			206,250			128,456			1,525,096
(Income) loss attributable to noncontrolling interest	(17,038		)	1,110			290			25,431
Net income attributable to Vertex	$	210,263		$	207,360		$	128,746		$	1,550,527

Amounts per share attributable to Vertex common shareholders:
Net income:
Basic	$	0.83		$	0.82		$	0.51		$	6.08
Diluted	$	0.81		$	0.80		$	0.50		$	5.97
Shares used in per share calculations:
Basic	253,231			254,135			254,905			254,868
Diluted	258,526			258,584			259,788			259,812



	Three Months Ended
	March 31, 2017			June 30, 2017			September 30, 2017			December 31, 2017
	(in thousands, except per share amounts)
Revenues:
Product revenues, net	$	480,622		$	513,988		$	549,642		$	621,228
Collaborative and royalty revenues (5)	234,096			30,147			28,523			30,406
Total revenues	714,718			544,135			578,165			651,634
Costs and expenses:
Cost of sales	46,988			71,205			72,874			84,052
Research and development expenses (6)	273,563			289,451			454,947			306,664
Sales, general and administrative expenses	113,326			127,249			120,710			134,794
Restructuring expenses	9,999			3,523			337			387
Intangible asset impairment charge (7)	—			—			255,340			—
Total costs and expenses	443,876			491,428			904,208			525,897
Income (loss) from operations	270,842			52,707			(326,043		)	125,737
Interest expense, net	(16,765		)	(14,664		)	(13,574		)	(12,547		)
Other expense, net (7)	(544		)	(2,537		)	(77,553		)	(748		)
Income (loss) before provision for (benefit from) income taxes	253,533			35,506			(417,170		)	112,442
Provision for (benefit from) income taxes (7)	3,985			4,337			(125,903		)	10,257
Net income (loss)	249,548			31,169			(291,267		)	102,185
(Income) loss attributable to noncontrolling interest (7)	(1,792		)	(13,173		)	188,315			(1,501		)
Net income (loss) attributable to Vertex	$	247,756		$	17,996		$	(102,952	)	$	100,684

Amounts per share attributable to Vertex common shareholders:
Net income (loss):
Basic	$	1.01		$	0.07		$	(0.41	)	$	0.40
Diluted	$	0.99		$	0.07		$	(0.41	)	$	0.39
Shares used in per share calculations:
Basic	246,024			247,521			250,268			251,557
Diluted	248,700			251,635			250,268			256,804


1.	In the fourth quarter of 2018, the Company incurred research and development expenses of $95.0 million to related license agreements with Merck KGaA, Darmstadt, Germany, and Arbor. See Note B, “Collaborative Arrangements and Acquisitions.”


2.	In the fourth quarter of 2018, the Company recorded a $29.0 million intangible asset impairment charge related to its VX-210 indefinite-lived in-process research and development asset. See Note J, “Intangible Assets and Goodwill.”


3.	In 2018, other income (expense), net was primarily related to changes in the fair value of the Company’s equity investment in CRISPR. See Note E, “Marketable Securities and Equity Investments.”


4.	In the fourth quarter of 2018, the Company released the valuation allowance on the majority of its net operating losses and other deferred tax assets as of December 31, 2018 resulting in a benefit from income taxes of $1.56 billion. See Note O, “Income Taxes.”


6.	In the third quarter of 2017, the Company incurred research and development expenses of $160.0 million to acquire certain CF assets including VX-561 from Concert. See Note B, “Collaborative Arrangements and Acquisitions.”

Nature of Business and Accounting Policies - Business Narrative (Details) $ in Billions	12 Months Ended
	Dec. 31, 2018 USD ($) segment
Accounting Policies [Abstract]
Cash, cash equivalents and marketable securities \| $	$ 3.2
Number of operating segments \| segment	1

Nature of Business and Accounting Policies - Revenue Recognition (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Jan. 01, 2018	Dec. 31, 2017
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Contract liabilites	$ 24,900		$ 1,700
Early access sales accrual	354,404	$ 225,128	232,401
Accounting Standards Update 2014-09
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative effect adjustment for adoption of new accounting guidance	(24,120)
Accounting Standards Update 2014-09 \| Accumulated Deficit
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative effect adjustment for adoption of new accounting guidance	$ 8,300	$ 8,300
HIV Protease Inhibitor Royalty
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Deferred Revenue			$ 6,900

Nature of Business and Accounting Policies - Share-Based Compensation (Details)	12 Months Ended
	Dec. 31, 2018
Accounting Policies [Abstract]
Percentage of employees eligible for acceleration of equity awards (less than) (percent)	5.00%

Nature of Business and Accounting Policies - Advertising Expenses (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Accounting Policies [Abstract]
Advertising expense	$ 43.5	$ 35.2	$ 31.4

Nature of Business and Accounting Policies - Property and Equipment (Details)	12 Months Ended
	Dec. 31, 2018
Furniture and equipment \| Minimum
Property, Plant and Equipment [Line Items]
Property and equipment useful life	7 years
Furniture and equipment \| Maximum
Property, Plant and Equipment [Line Items]
Property and equipment useful life	10 years
Computers and software \| Minimum
Property, Plant and Equipment [Line Items]
Property and equipment useful life	3 years
Computers and software \| Maximum
Property, Plant and Equipment [Line Items]
Property and equipment useful life	5 years
Buildings and leasehold improvements
Property, Plant and Equipment [Line Items]
Property and equipment useful life	40 years

Nature of Business and Accounting Policies - Foreign Currency Gain (Loss) (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Accounting Policies [Abstract]
Derivative term (less than)	1 month
Foreign Currency Translation
Net foreign currency transaction gain (loss)	$ (1.1)	$ (5.5)	$ 4.0

Nature of Business and Accounting Policies - Cumulative Effect of applying ASC 606 to the Condensed Consolidated Balance Sheet (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Jan. 01, 2018	Dec. 31, 2017
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Accounts receivable, net	$ 409,688	$ 311,224	$ 281,343
Inventories	124,360	111,740	111,830
Prepaid expenses and other current assets	140,819	149,958	167,124
Total assets	6,245,898	3,558,639	3,546,014
Accrued expenses	604,495	452,547	443,961
Early access sales accrual	354,404	225,128	232,401
Other liabilities, current portion	40,589	36,456	34,373
Accumulated other comprehensive income (loss)	659	(10,623)	(11,572)
Accumulated deficit	(2,989,478)	(5,111,443)	(5,119,723)
Total liabilities and shareholders’ equity	6,245,898	3,558,639	$ 3,546,014
Balances without Adoption of ASC 606
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Accounts receivable, net	376,949
Inventories	124,506
Prepaid expenses and other current assets	167,522
Total assets	6,240,008
Accrued expenses	618,873
Early access sales accrual	380,609
Other liabilities, current portion	14,355
Accumulated other comprehensive income (loss)	927
Accumulated deficit	(3,009,985)
Total liabilities and shareholders’ equity	6,240,008
Effect of Change Higher/(Lower) \| Accounting Standards Update 2014-09
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Accounts receivable, net	32,739	29,881
Inventories	(146)	(90)
Prepaid expenses and other current assets	(26,703)	(17,166)
Total assets	5,890	12,625
Accrued expenses	(14,378)	8,586
Early access sales accrual	(26,205)	(7,273)
Other liabilities, current portion	26,234	2,083
Accumulated other comprehensive income (loss)	(268)	949
Accumulated deficit	20,507	8,280
Total liabilities and shareholders’ equity	$ 5,890	$ 12,625

Nature of Business and Accounting Policies - Impact of Adopted to the Condensed Consolidated Balance Sheet (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Product revenues, net	$ 870,106	$ 784,535	$ 752,157	$ 640,799	$ 651,634	$ 578,165	$ 544,135	$ 714,718	$ 3,047,597	$ 2,488,652	$ 1,702,177
Cost of sales	122,289	111,255	104,382	71,613	84,052	72,874	71,205	46,988	409,539	275,119	210,460
Income from operations	127,722	205,649	172,878	128,901	125,737	(326,043)	52,707	270,842	635,150	123,243	9,936
Net income (loss) attributable to Vertex	$ 1,550,527	$ 128,746	$ 207,360	$ 210,263	$ 100,684	$ (102,952)	$ 17,996	$ 247,756	$ 2,096,896	$ 263,484	$ (112,052)
Basic (usd per share)	$ 6.08	$ 0.51	$ 0.82	$ 0.83	$ 0.40	$ (0.41)	$ 0.07	$ 1.01	$ 8.24	$ 1.06	$ (0.46)
Diluted (usd per share)	$ 5.97	$ 0.50	$ 0.80	$ 0.81	$ 0.39	$ (0.41)	$ 0.07	$ 0.99	$ 8.09	$ 1.04	$ (0.46)
Product
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Product revenues, net	$ 868,173	$ 782,511	$ 749,912	$ 637,729	$ 621,228	$ 549,642	$ 513,988	$ 480,622	$ 3,038,325	$ 2,165,480	$ 1,683,632
Balances without Adoption of ASC 606
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Cost of sales									402,925
Income from operations									622,923
Net income (loss) attributable to Vertex									$ 2,084,669
Basic (usd per share)									$ 8.20
Diluted (usd per share)									$ 8.04
Balances without Adoption of ASC 606 \| Product
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Product revenues, net									$ 3,019,484
Effect of Change Higher/(Lower) \| Accounting Standards Update 2014-09
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Cost of sales									6,614
Income from operations									12,227
Net income (loss) attributable to Vertex									$ 12,227
Basic (usd per share)									$ 0.04
Diluted (usd per share)									$ 0.05
Effect of Change Higher/(Lower) \| Accounting Standards Update 2014-09 \| Product
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Product revenues, net									$ 18,841

Nature of Business and Accounting Policies Nature of Business and Accounting Policies - Equity Investments (Details) $ in Millions	12 Months Ended
	Dec. 31, 2018 USD ($)
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Unrealized gains to other (expense) income, net	$ 2.6
Accounting standards update 2016-01, financial instruments \| Accumulated Deficit
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative effect adjustment for adoption of new accounting guidance	$ 25.1

Nature of Business and Accounting Policies Nature of Business and Accounting Policies - Intra-Equity Transfers (Details) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Deferred tax assets	$ 1,880,125,000	$ 1,734,542,000
Accounting Standards Update 2016-16
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Deferred tax assets	204,700,000
Accumulated Deficit \| Accounting standards update 2016-01
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative effect adjustment for adoption of new accounting guidance	$ 0

Nature of Business and Accounting Policies - Schedule of Cash, Cash Equivalents, and Restricted Cash (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Cash and Cash Equivalents [Line Items]
Cash and cash equivalents	$ 2,650,134	$ 1,665,412	$ 1,183,945	$ 714,768
Cash, cash equivalents and restricted cash per statement of cash flows	2,658,253	1,667,526	1,231,707	815,761
Prepaid and other current assets
Cash and Cash Equivalents [Line Items]
Restricted cash and cash equivalents	4,910	2,114	47,762	78,910
Other assets
Cash and Cash Equivalents [Line Items]
Restricted cash and cash equivalents	$ 3,209	$ 0	$ 0	$ 22,083

Nature of Business and Accounting Policies - Stock-Based Compensation - Improvement (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017	Jan. 01, 2017	Dec. 31, 2016
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Operating loss carryforwards	$ 2,900,000	$ 775,500
Accounting standards update 2016-09, excess tax benefit
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Operating loss carryforwards			$ 410,800
Deferred income tax assets, net			3,400
Accounting standards update 2016-09, forfeiture rate component
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative effect adjustment for adoption of new accounting guidance		9,229
Domestic Tax Authority \| Accounting standards update 2016-09, excess tax benefit
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Operating loss carryforwards			404,700
State and Local Jurisdiction \| Accounting standards update 2016-09, excess tax benefit
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Operating loss carryforwards			6,100
Accumulated Deficit \| Accounting standards update 2016-09, forfeiture rate component
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative effect adjustment for adoption of new accounting guidance		$ 33,349	$ 9,400	$ (9,371)

Nature of Business and Accounting Policies Nature of Business and Accounting Policies - Leases (Details) - Accounting Standards Update 2016-02 $ in Millions	12 Months Ended
	Dec. 31, 2018 USD ($)
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Expected future increase (decrease) in operating expenses	$ 26
Expected future increase (decrease) in interest expense	(13)
Expected right-of-use assets	60
Expected right-of-use liabilities	70
Accumulated Deficit
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Expected cumulative effect of new accounting principle in period of adoption	$ 50

Collaborative Arrangements - CRISPR Therapeutics AG (Details)	12 Months Ended
	Dec. 31, 2018 USD ($)	Dec. 31, 2015 USD ($) target
CRISPR Therapeutics
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Right to license, number of targets (up to) \| target		6
Collaborative funding		$ 75,000,000.0
Collaborative arrangement development and regulatory potential milestone payments maximum		$ 420,000,000
CTX001 Co-Co Agreement
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Collaborative Arrangement Research and Development Expenses	$ 19,700,000

Collaborative Arrangements Collaborative Arrangements - Other In-License Agreements (Details) - USD ($)	1 Months Ended
	Dec. 31, 2018	Jul. 31, 2016
Moderna Therapeutics, Inc.
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Up-front payment		$ 20,000,000
Collaborative arrangement development and regulatory potential milestone payments maximum		$ 275,000,000
Arbor
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Up-front payment	$ 30,000,000
Collaborative arrangement development and regulatory potential milestone payments maximum	337,500,000.0
Investment in collaborative partner, pursuant to convertible loan agreement	$ 15,000,000

Collaborative Arrangements - Parion Sciences, Inc. (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
(Benefit from) provision for income taxes	$ (1,492,599)	$ 8,055	$ 10,341	$ (12,659)	$ 10,257	$ (125,903)	$ 4,337	$ 3,985	$ (1,486,862)	$ (107,324)	$ 16,665
Intangible asset impairment charges	$ 29,000	$ 0	$ 0	$ 0	$ 0	255,340	0	$ 0	29,000	255,340	0
Parion Sciences, Inc
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Up-front payment									85,000			$ 85,000
Collaborative and royalty revenues						20,000	$ 20,000
(Benefit from) provision for income taxes						(126,200)
Intangible asset impairment charges						255,300
Business combination, contingent consideration arrangements, change in amount of contingent consideration, liability						(69,600)
Income tax expense (benefit), attributable to intangible asset impairment						(97,700)
Income tax expense (benefit), attributable to decrease in the fair value of contingent consideration liability						$ (28,500)
Deconsolidation, gain (loss), amount									(7,100)	(7,100)
Variable Interest Entity, Primary Beneficiary
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
(Benefit from) provision for income taxes									(3,668)	(114,090)	16,743
Business combination, contingent consideration arrangements, change in amount of contingent consideration, liability									17,730	(62,560)	54,850
Variable Interest Entity, Primary Beneficiary \| Parion Sciences, Inc
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Collaborative and royalty revenues										40,000
(Benefit from) provision for income taxes										14,800
Business combination, contingent consideration arrangements, change in amount of contingent consideration, liability									$ 0	$ (63,460)	$ 64,800

Collaborative Arrangements - BioAxone Biosciences, Inc. (Details) - USD ($)	3 Months Ended	12 Months Ended
	Mar. 31, 2018	Dec. 31, 2018	Dec. 31, 2014	Dec. 31, 2017
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Contingent liabilities		$ 0		$ 0
BioAxone Biosciences, Inc
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Up-front payment	$ 10,000,000	$ 10,000,000	$ 10,000,000

Collaborative Arrangements - Aggregate VIE Financial Information (Details) - USD ($)	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Variable Interest Entity, Primary Beneficiary, Does Not Hold Majority Voting Interest, Disclosures [Abstract]
(Benefit from) provision for income taxes	$ (1,492,599,000)	$ 8,055,000	$ 10,341,000	$ (12,659,000)	$ 10,257,000	$ (125,903,000)	$ 4,337,000	$ 3,985,000	$ (1,486,862,000)	$ (107,324,000)	$ 16,665,000
Net loss (income) attributable to noncontrolling interest	25,431,000	$ 290,000	$ 1,110,000	(17,038,000)	(1,501,000)	188,315,000	$ (13,173,000)	$ (1,792,000)	9,793,000	171,849,000	(28,021,000)
Variable Interest Entity, Consolidated, Carrying Amount, Assets and Liabilities, Net:
Intangible assets	0				29,000,000				0	29,000,000
Deferred tax liabilities	0				6,341,000				0	6,341,000
Noncontrolling interest	0				13,727,000				0	13,727,000
Parion Sciences, Inc
Schedule of Collaborative Arrangement Agreements [Line Items]
Up-front payment									85,000,000			$ 85,000,000
Variable Interest Entity, Primary Beneficiary, Does Not Hold Majority Voting Interest, Disclosures [Abstract]
(Benefit from) provision for income taxes						(126,200,000)
(Increase) decrease in fair value of contingent payments						$ 69,600,000
BioAxone Biosciences, Inc
Schedule of Collaborative Arrangement Agreements [Line Items]
Up-front payment				$ 10,000,000					10,000,000				$ 10,000,000
Fair value of the contingent payments payable	0								0
Variable Interest Entity, Primary Beneficiary, Does Not Hold Majority Voting Interest, Disclosures [Abstract]
Contingent consideration liability	$ 18,900,000				18,900,000				18,900,000	18,900,000
Variable Interest Entity, Primary Beneficiary
Variable Interest Entity, Primary Beneficiary, Does Not Hold Majority Voting Interest, Disclosures [Abstract]
Loss attributable to noncontrolling interest before (benefit from) provision for income taxes and changes in fair value of contingent payments									31,191,000	223,379,000	10,086,000
(Benefit from) provision for income taxes									(3,668,000)	(114,090,000)	16,743,000
(Increase) decrease in fair value of contingent payments									(17,730,000)	62,560,000	(54,850,000)
Net loss (income) attributable to noncontrolling interest									9,793,000	171,849,000	(28,021,000)
Variable Interest Entity, Consolidated, Carrying Amount, Assets and Liabilities, Net:
Deferred tax liabilities					4,756,000					4,756,000
Noncontrolling interest					$ 13,727,000					13,727,000
Variable Interest Entity, Primary Beneficiary \| Parion Sciences, Inc
Variable Interest Entity, Primary Beneficiary, Does Not Hold Majority Voting Interest, Disclosures [Abstract]
(Benefit from) provision for income taxes										14,800,000
(Increase) decrease in fair value of contingent payments									$ 0	63,460,000	(64,800,000)
Variable Interest Entity, Consolidated, Carrying Amount, Assets and Liabilities, Net:
Intangible assets											255,300,000
Variable Interest Entity, Primary Beneficiary \| BioAxone Biosciences, Inc
Variable Interest Entity, Primary Beneficiary, Does Not Hold Majority Voting Interest, Disclosures [Abstract]
(Increase) decrease in fair value of contingent payments										$ (900,000)	$ 9,950,000

Collaborative Arrangements - Concert Pharmaceuticals (Details) - Concert Pharmaceuticals - USD ($) $ in Millions	1 Months Ended		3 Months Ended	12 Months Ended
	Jul. 31, 2017	Jul. 30, 2017	Sep. 30, 2017	Dec. 31, 2017
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Collaborative arrangement, development and commercialization rights potential maximum milestone payments		$ 160.0	$ 160.0
Collaborative arrangement, additional maximum milestone payments based on regulatory approval		$ 90.0
Collaborative funding				$ 160.0
Collaborative arrangement, purchase price	$ 165.1
Collaborative arrangement, transaction costs	$ 5.1

Collaborative Arrangements - Merck KGaA (Details) - Merck KGaA	1 Months Ended		3 Months Ended
	Dec. 31, 2018 USD ($)	Jan. 31, 2017 USD ($) pre-clinical_stage_program clinical-stage_program development_program	Mar. 31, 2017 USD ($)
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Right to license, number of development programs \| development_program		4
Right to license, number of clinical stage programs \| clinical-stage_program		2
Number of pre-clinical stage programs \| pre-clinical_stage_program		2
Up-front payment	$ 65,000,000		$ 230,000,000.0
Collaborative arrangement development and regulatory potential milestone payments maximum		$ 230,000,000

Collaborative Arrangements - Janssen Pharmaceuticals, Inc. (Details) - Janssen - USD ($) $ in Millions	3 Months Ended	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2014
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Collaborative arrangement, up-front payment		$ 35.0
Collaborative and royalty revenues	$ 25.0

Collaborative Arrangements - Cystic Fibrosis Foundation Therapeutics Incorporated (Details) - Cystic Fibrosis Foundation Therapeutics Incorporated	12 Months Ended
	Dec. 31, 2016 USD ($)
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Milestone payments	$ 13,900,000
Collaborative funding	75,000,000.0
Additional collaborative funding	$ 6,000,000.0

Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Basic net income (loss) attributable to Vertex per common share calculation:
Net income (loss) attributable to Vertex common shareholders	$ 1,550,527	$ 128,746	$ 207,360	$ 210,263	$ 100,684	$ (102,952)	$ 17,996	$ 247,756	$ 2,096,896	$ 263,484	$ (112,052)
Less: Undistributed earnings allocated to participating securities									(501)	(293)	0
Net income (loss) attributable to Vertex common shareholders—basic									$ 2,096,395	$ 263,191	$ (112,052)
Basic weighted-average common shares outstanding	254,868	254,905	254,135	253,231	251,557	250,268	247,521	246,024	254,292	248,858	244,685
Basic net income (loss) attributable to Vertex per common share (usd per share)	$ 6.08	$ 0.51	$ 0.82	$ 0.83	$ 0.40	$ (0.41)	$ 0.07	$ 1.01	$ 8.24	$ 1.06	$ (0.46)
Diluted net income (loss) attributable to Vertex per common share calculation:
Net income (loss) attributable to Vertex common shareholders—diluted									$ 2,096,404	$ 263,196	$ (112,052)
Less: Undistributed earnings allocated to participating securities									$ (492)	$ (288)	$ 0
Employee stock purchase plan (in shares)									17	28	0
Weighted-average shares used to compute diluted net income (loss) per common share	259,812	259,788	258,584	258,526	256,804	250,268	251,635	248,700	259,185	253,225	244,685
Diluted net income (loss) attributable to Vertex per common share (usd per share)	$ 5.97	$ 0.50	$ 0.80	$ 0.81	$ 0.39	$ (0.41)	$ 0.07	$ 0.99	$ 8.09	$ 1.04	$ (0.46)
Stock options
Diluted net income (loss) attributable to Vertex per common share calculation:
Share-based payment arrangements (in shares)									2,913	2,797	0
Antidilutive securities excluded from computation of earnings per share (in shares)									2,217	3,554	12,642
Unvested restricted stock and restricted stock units (including PSUs)
Diluted net income (loss) attributable to Vertex per common share calculation:
Antidilutive securities excluded from computation of earnings per share (in shares)									5	411	3,546
Restricted stock and restricted stock units (including PSUs)
Diluted net income (loss) attributable to Vertex per common share calculation:
Share-based payment arrangements (in shares)									1,963	1,542	0

Fair Value Measurements (Details) - Recurring basis - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Financial instruments carried at fair value (asset position):
Total financial assets	$ 1,836,605	$ 1,108,253
Total financial liabilities	(448)	(14,508)
Money market funds
Financial instruments carried at fair value (asset position):
Cash equivalents	1,226,603	614,951
U.S. Treasury securities
Financial instruments carried at fair value (asset position):
Cash equivalents	5,966
Marketable securities	6,026
Government-sponsored enterprise securities
Financial instruments carried at fair value (asset position):
Cash equivalents	7,123	12,678
Marketable securities	10,704	2,303
Commercial paper
Financial instruments carried at fair value (asset position):
Cash equivalents	58,268	57,357
Marketable securities	100,390	80,263
Corporate equity securities
Financial instruments carried at fair value (asset position):
Marketable securities	167,323	74,821
Corporate debt securities
Financial instruments carried at fair value (asset position):
Marketable securities	233,665	265,867
Prepaid and other current assets \| Foreign currency forward contracts
Financial instruments carried at fair value (asset position):
Prepaid and other current assets	19,023	13
Other assets \| Foreign currency forward contracts
Financial instruments carried at fair value (asset position):
Other assets	1,514
Other liabilities, current portion \| Foreign currency forward contracts
Financial instruments carried at fair value (asset position):
Foreign currency forward contracts	(340)	(13,642)
Other liabilities, excluding current portion \| Foreign currency forward contracts
Financial instruments carried at fair value (asset position):
Other liabilities, excluding current portion	(108)	(866)
Level 1
Financial instruments carried at fair value (asset position):
Total financial assets	1,410,155	704,753
Total financial liabilities	0	0
Level 1 \| Money market funds
Financial instruments carried at fair value (asset position):
Cash equivalents	1,226,603	614,951
Level 1 \| U.S. Treasury securities
Financial instruments carried at fair value (asset position):
Cash equivalents	5,966
Marketable securities	6,026
Level 1 \| Government-sponsored enterprise securities
Financial instruments carried at fair value (asset position):
Cash equivalents	7,123	12,678
Marketable securities	10,704	2,303
Level 1 \| Commercial paper
Financial instruments carried at fair value (asset position):
Cash equivalents	0	0
Marketable securities	0	0
Level 1 \| Corporate equity securities
Financial instruments carried at fair value (asset position):
Marketable securities	153,733	74,821
Level 1 \| Corporate debt securities
Financial instruments carried at fair value (asset position):
Marketable securities	0	0
Level 1 \| Prepaid and other current assets \| Foreign currency forward contracts
Financial instruments carried at fair value (asset position):
Prepaid and other current assets	0	0
Level 1 \| Other assets \| Foreign currency forward contracts
Financial instruments carried at fair value (asset position):
Other assets	0
Level 1 \| Other liabilities, current portion \| Foreign currency forward contracts
Financial instruments carried at fair value (asset position):
Foreign currency forward contracts	0	0
Level 1 \| Other liabilities, excluding current portion \| Foreign currency forward contracts
Financial instruments carried at fair value (asset position):
Other liabilities, excluding current portion	0	0
Level 2
Financial instruments carried at fair value (asset position):
Total financial assets	426,450	403,500
Total financial liabilities	(448)	(14,508)
Level 2 \| Money market funds
Financial instruments carried at fair value (asset position):
Cash equivalents	0	0
Level 2 \| U.S. Treasury securities
Financial instruments carried at fair value (asset position):
Cash equivalents	0
Marketable securities	0
Level 2 \| Government-sponsored enterprise securities
Financial instruments carried at fair value (asset position):
Cash equivalents	0	0
Marketable securities	0	0
Level 2 \| Commercial paper
Financial instruments carried at fair value (asset position):
Cash equivalents	58,268	57,357
Marketable securities	100,390	80,263
Level 2 \| Corporate equity securities
Financial instruments carried at fair value (asset position):
Marketable securities	13,590	0
Level 2 \| Corporate debt securities
Financial instruments carried at fair value (asset position):
Marketable securities	233,665	265,867
Level 2 \| Prepaid and other current assets \| Foreign currency forward contracts
Financial instruments carried at fair value (asset position):
Prepaid and other current assets	19,023	13
Level 2 \| Other assets \| Foreign currency forward contracts
Financial instruments carried at fair value (asset position):
Other assets	1,514
Level 2 \| Other liabilities, current portion \| Foreign currency forward contracts
Financial instruments carried at fair value (asset position):
Foreign currency forward contracts	(340)	(13,642)
Level 2 \| Other liabilities, excluding current portion \| Foreign currency forward contracts
Financial instruments carried at fair value (asset position):
Other liabilities, excluding current portion	(108)	(866)
Level 3
Financial instruments carried at fair value (asset position):
Total financial assets	0	0
Total financial liabilities	0	0
Level 3 \| Money market funds
Financial instruments carried at fair value (asset position):
Cash equivalents	0	0
Level 3 \| U.S. Treasury securities
Financial instruments carried at fair value (asset position):
Cash equivalents	0
Marketable securities	0
Level 3 \| Government-sponsored enterprise securities
Financial instruments carried at fair value (asset position):
Cash equivalents	0	0
Marketable securities	0	0
Level 3 \| Commercial paper
Financial instruments carried at fair value (asset position):
Cash equivalents	0	0
Marketable securities	0	0
Level 3 \| Corporate equity securities
Financial instruments carried at fair value (asset position):
Marketable securities	0	0
Level 3 \| Corporate debt securities
Financial instruments carried at fair value (asset position):
Marketable securities	0	0
Level 3 \| Prepaid and other current assets \| Foreign currency forward contracts
Financial instruments carried at fair value (asset position):
Prepaid and other current assets	0	0
Level 3 \| Other assets \| Foreign currency forward contracts
Financial instruments carried at fair value (asset position):
Other assets	0
Level 3 \| Other liabilities, current portion \| Foreign currency forward contracts
Financial instruments carried at fair value (asset position):
Foreign currency forward contracts	0	0
Level 3 \| Other liabilities, excluding current portion \| Foreign currency forward contracts
Financial instruments carried at fair value (asset position):
Other liabilities, excluding current portion	$ 0	$ 0

Marketable Securities and Equity Investments (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Available-for-sale Debt Securities
Fair Value	$ 1,648,745	$ 1,033,419
Equity Securities, FV-NI and without Readily Determinable Fair Value [Abstract]
Amortized Cost	484,473
Gross Unrealized Gains	40,646
Gross Unrealized Losses	7,011
Fair Value	518,108
Amortized Cost		392,225
Gross Unrealized Gains		31,608
Gross Unrealized Losses		(579)
Fair Value		423,254
Money market funds
Summary of cash, cash equivalents and marketable securities
Amortized Cost	1,226,603	614,951
Gross Unrealized Gains	0	0
Gross Unrealized Losses	0	0
Fair Value	1,226,603	614,951
U.S. Treasury securities
Summary of cash, cash equivalents and marketable securities
Amortized Cost	5,967
Gross Unrealized Gains	0
Gross Unrealized Losses	1
Fair Value	5,966
Government-sponsored enterprise securities
Summary of cash, cash equivalents and marketable securities
Amortized Cost	7,124	12,679
Gross Unrealized Gains	0	0
Gross Unrealized Losses	1	1
Fair Value	7,123	12,678
Commercial paper
Summary of cash, cash equivalents and marketable securities
Amortized Cost	58,271	57,371
Gross Unrealized Gains	0	0
Gross Unrealized Losses	3	14
Fair Value	58,268	57,357
Cash Equivalents
Summary of cash, cash equivalents and marketable securities
Amortized Cost	1,297,965	685,001
Gross Unrealized Gains	0	0
Gross Unrealized Losses	5	15
Fair Value	1,297,960	684,986
Total marketable debt securities
Available-for-sale Debt Securities
Amortized Cost	351,316	349,012
Gross Unrealized Gains	27	0
Gross Unrealized Losses	(558)	(579)
Fair Value	350,785	348,433
US Treasury securities (matures within 1 year)
Available-for-sale Debt Securities
Amortized Cost	6,026
Gross Unrealized Gains	0
Gross Unrealized Losses	0
Fair Value	6,026
Government-sponsored enterprise securities (matures within 1 year)
Available-for-sale Debt Securities
Amortized Cost	10,704	2,304
Gross Unrealized Gains	0	0
Gross Unrealized Losses	0	(1)
Fair Value	10,704	2,303
Corporate debt securities (matures within 1 year)
Available-for-sale Debt Securities
Amortized Cost	232,845	215,639
Gross Unrealized Gains	25	0
Gross Unrealized Losses	(450)	(363)
Fair Value	232,420	215,276
Corporate debt securities (matures after 1 year through 5 years)
Available-for-sale Debt Securities
Amortized Cost	1,243	50,697
Gross Unrealized Gains	2	0
Gross Unrealized Losses	0	(106)
Fair Value	1,245	50,591
Commercial Paper (matures within 1 year)
Available-for-sale Debt Securities
Amortized Cost	100,498	80,372
Gross Unrealized Gains	0	0
Gross Unrealized Losses	(108)	(109)
Fair Value	100,390	80,263
Corporate equity securities
Equity Securities, FV-NI and without Readily Determinable Fair Value [Abstract]
Amortized Cost	133,157
Gross Unrealized Gains	40,619
Gross Unrealized Losses	6,453
Fair Value	$ 167,323
Amortized Cost		43,213
Gross Unrealized Gains		31,608
Gross Unrealized Losses		0
Fair Value		$ 74,821

Marketable Securities and Equity Investments Marketable Securities and Equity Investments - Narrative (Details) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Summary of cash, cash equivalents and marketable securities
Other-than-temporary declines in fair value of available-for-sale debt securities	$ 0	$ 0	$ 0
Gross realized gains or losses	0	$ 0	$ 0
Unrealized gains to other (expense) income, net	2,600,000
Other assets
Summary of cash, cash equivalents and marketable securities
Equity securities without readily determinable fair value, amount	13,600,000
CRISPR Therapeutics
Summary of cash, cash equivalents and marketable securities
Marketable securities, fair value, investment in common stock	153,700,000
Unrealized gains to other (expense) income, net	9,000,000
Payments to acquire investment	69,900,000
Moderna Therapeutics, Inc.
Summary of cash, cash equivalents and marketable securities
Marketable securities, fair value, investment in common stock	13,600,000
Unrealized gains to other (expense) income, net	$ 6,500,000

Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance	$ 2,042,306	$ 1,338,191	$ 1,093,628
Other comprehensive income before reclassifications	34,577	(35,390)	28,996
Amounts reclassified from accumulated other comprehensive income (loss)	1,774	2,645	(9,647)
Total changes in other comprehensive income (loss)	36,351	(32,745)	19,349
Balance	4,435,203	2,042,306	1,338,191
Foreign Currency Translation Adjustment
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance	(21,031)	(7,862)	(2,080)
Other comprehensive income before reclassifications	8,855	(13,169)	(5,782)
Amounts reclassified from accumulated other comprehensive income (loss)	0	0	0
Total changes in other comprehensive income (loss)	8,855	(13,169)	(5,782)
Balance	(11,227)	(21,031)	(7,862)
On Available-For-Sale Debt Securities
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance	(594)	(10)	126
Other comprehensive income before reclassifications	58	(584)	(136)
Amounts reclassified from accumulated other comprehensive income (loss)	0	0	0
Total changes in other comprehensive income (loss)	58	(584)	(136)
Balance	(536)	(594)	(10)
On Equity Securities
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance	25,069	17,531	0
Other comprehensive income before reclassifications	0	7,538	17,531
Amounts reclassified from accumulated other comprehensive income (loss)	0	0	0
Total changes in other comprehensive income (loss)	0	7,538	17,531
Balance	0	25,069	17,531
On Foreign Currency Forward Contracts
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance	(15,016)	11,514	3,778
Other comprehensive income before reclassifications	25,664	(29,175)	17,383
Amounts reclassified from accumulated other comprehensive income (loss)	1,774	2,645	(9,647)
Total changes in other comprehensive income (loss)	27,438	(26,530)	7,736
Balance	12,422	(15,016)	11,514
AOCI Attributable to Parent
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Balance	(11,572)	21,173	1,824
Total changes in other comprehensive income (loss)	36,351	(32,745)	19,349
Balance	659	$ (11,572)	$ 21,173
Accounting Standards Update 2014-09
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Cumulative effect adjustment for adoption of new accounting guidance	(24,120)
Accounting Standards Update 2014-09 \| Foreign Currency Translation Adjustment
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Cumulative effect adjustment for adoption of new accounting guidance	949
Accounting Standards Update 2014-09 \| On Available-For-Sale Debt Securities
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Cumulative effect adjustment for adoption of new accounting guidance	0
Accounting Standards Update 2014-09 \| On Equity Securities
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Cumulative effect adjustment for adoption of new accounting guidance	(25,069)
Accounting Standards Update 2014-09 \| On Foreign Currency Forward Contracts
AOCI Attributable to Parent, Net of Tax [Roll Forward]
Cumulative effect adjustment for adoption of new accounting guidance	$ 0

Hedging - Narrative (Details) $ in Millions	12 Months Ended
Hedging - Narrative (Details) $ in Millions	Dec. 31, 2018 USD ($)
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative term	1 month
Foreign currency forward contracts \| Not designated as hedging instrument
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative term	1 year
Foreign currency forward contracts \| Not designated as hedging instrument \| Cash Flow Hedging
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Notional amount of foreign currency forward contract	$ 251.4

Hedging - Notional Amount (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Derivative [Line Items]
Derivative term	1 month
Designated as hedging instruments \| Cash Flow Hedging \| Foreign currency forward contracts
Derivative [Line Items]
Notional amount of foreign currency forward contract	$ 505,218	$ 365,212
Designated as hedging instruments \| Cash Flow Hedging \| Foreign currency forward contracts \| Euro
Derivative [Line Items]
Notional amount of foreign currency forward contract	335,179	257,230
Designated as hedging instruments \| Cash Flow Hedging \| Foreign currency forward contracts \| British pound sterling
Derivative [Line Items]
Notional amount of foreign currency forward contract	73,460	77,481
Designated as hedging instruments \| Cash Flow Hedging \| Foreign currency forward contracts \| Australian dollar
Derivative [Line Items]
Notional amount of foreign currency forward contract	52,820	30,501
Designated as hedging instruments \| Cash Flow Hedging \| Foreign currency forward contracts \| Canadian dollar
Derivative [Line Items]
Notional amount of foreign currency forward contract	$ 43,759	$ 0
Minimum \| Cash Flow Hedging \| Foreign currency forward contracts
Derivative [Line Items]
Derivative term	1 month
Maximum \| Cash Flow Hedging \| Foreign currency forward contracts
Derivative [Line Items]
Derivative term	18 months

Hedging Hedging - Cash Flow Hedging Instruments (Details) - Foreign currency forward contracts - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Product revenues, net \| Designated as hedging instruments
Derivative Instruments, Gain (Loss) [Line Items]
Gain (loss) on cash flow hedging instruments	$ (1,252)	$ 768	$ 10,543
Other (expense) income, net \| Not designated as hedging instrument
Derivative Instruments, Gain (Loss) [Line Items]
Gain (loss) on cash flow hedging instruments	$ 623	$ 14,129	$ (6,917)

Hedging - Derivative Fair Value (Details) - Foreign currency forward contracts - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Foreign Currency Cash Flow Hedge Derivative at Fair Value [Abstract]
Total assets	$ 20,537	$ 13
Total liabilities	(448)	(14,508)
Designated as hedging instruments
Foreign Currency Cash Flow Hedge Derivative at Fair Value [Abstract]
Total assets	20,537	13
Total liabilities	(448)	(14,508)
Prepaid and other current assets \| Designated as hedging instruments
Foreign Currency Cash Flow Hedge Derivative at Fair Value [Abstract]
Fair value - assets	19,023	13
Other liabilities, current portion \| Designated as hedging instruments
Foreign Currency Cash Flow Hedge Derivative at Fair Value [Abstract]
Fair value - liabilities	(340)	(13,642)
Other assets \| Designated as hedging instruments
Foreign Currency Cash Flow Hedge Derivative at Fair Value [Abstract]
Fair value - assets	1,514	0
Other liabilities, excluding current portion \| Designated as hedging instruments
Foreign Currency Cash Flow Hedge Derivative at Fair Value [Abstract]
Fair value - liabilities	$ (108)	$ (866)

Hedging - Offsetting Derivatives (Details) - Foreign currency forward contracts - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Offsetting Derivative Assets [Abstract]
Gross Amounts Recognized	$ 20,537	$ 13
Gross Amounts Offset	0	0
Gross Amounts Presented	20,537	13
Gross Amounts Not Offset	(448)	(13)
Legal Offset	20,089	0
Offsetting Derivative Liabilities [Abstract]
Gross Amounts Recognized	(448)	(14,508)
Gross Amounts Offset	0	0
Gross Amounts Presented	(448)	(14,508)
Gross Amounts Not Offset	448	13
Legal Offset	$ 0	$ (14,495)

Inventories (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Jan. 01, 2018	Dec. 31, 2017
Inventory Disclosure [Abstract]
Raw materials	$ 9,677		$ 20,924
Work-in-process	87,944		74,237
Finished goods	26,739		16,669
Total	$ 124,360	$ 111,740	$ 111,830

Property and Equipment (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Property, Plant and Equipment [Line Items]
Total property and equipment, gross	$ 1,263,448	$ 1,221,560
Less: accumulated depreciation	(451,443)	(432,123)
Total property and equipment, net	812,005	789,437
Buildings
Property, Plant and Equipment [Line Items]
Total property and equipment, gross	657,438	634,061
Furniture and equipment
Property, Plant and Equipment [Line Items]
Total property and equipment, gross	280,908	256,509
Software
Property, Plant and Equipment [Line Items]
Total property and equipment, gross	162,601	151,890
Leasehold improvements
Property, Plant and Equipment [Line Items]
Total property and equipment, gross	103,428	117,806
Computers
Property, Plant and Equipment [Line Items]
Total property and equipment, gross	$ 59,073	$ 61,294

Property and Equipment - Narrative (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Property, Plant and Equipment [Abstract]
Total capital leased assets, gross	$ 94.8	$ 100.9
Capital leases accumulated depreciation	34.0	43.4
Depreciation expense	$ 72.4	$ 61.4	$ 60.8

Intangible Assets and Goodwill (Details) - USD ($)	3 Months Ended								12 Months Ended
Intangible Assets and Goodwill (Details) - USD ($)	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Indefinite-Lived Intangible Assets [Line Items]
Intangible assets	$ 0				$ 29,000,000				$ 0	$ 29,000,000
Intangible asset impairment charges	29,000,000	$ 0	$ 0	$ 0	0	$ 255,340,000	$ 0	$ 0	29,000,000	255,340,000	$ 0
(Benefit from) provision for income taxes	(1,492,599,000)	$ 8,055,000	$ 10,341,000	$ (12,659,000)	10,257,000	(125,903,000)	$ 4,337,000	$ 3,985,000	(1,486,862,000)	(107,324,000)	16,665,000
Goodwill	$ 50,384,000				$ 50,384,000				50,384,000	50,384,000
Parion Sciences, Inc
Indefinite-Lived Intangible Assets [Line Items]
Intangible asset impairment charges						255,300,000
(Benefit from) provision for income taxes						(126,200,000)
Variable Interest Entity, Primary Beneficiary
Indefinite-Lived Intangible Assets [Line Items]
(Benefit from) provision for income taxes									(3,668,000)	(114,090,000)	16,743,000
Variable Interest Entity, Primary Beneficiary \| Parion Sciences, Inc
Indefinite-Lived Intangible Assets [Line Items]
Intangible assets											$ 255,300,000
Fair value of intangible asset						0
(Benefit from) provision for income taxes										14,800,000
Other Intangible Assets \| Variable Interest Entity, Primary Beneficiary \| Parion Sciences, Inc
Indefinite-Lived Intangible Assets [Line Items]
Intangible asset impairment charges						255,300,000				255,300,000
(Benefit from) provision for income taxes										$ (97,700,000)
Other Intangible Assets \| Variable Interest Entity, Primary Beneficiary \| BioAxone Biosciences, Inc
Indefinite-Lived Intangible Assets [Line Items]
Intangible asset impairment charges						$ 29,000,000
(Benefit from) provision for income taxes									$ (7,900,000)

Additional Balance Sheet Detail (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Jan. 01, 2018	Dec. 31, 2017
Prepaid and other current assets
Prepaid expenses	$ 74,045		$ 62,475
Collaborative accounts receivable	5,182		28,907
Other receivables and assets	61,592		75,742
Total	140,819	$ 149,958	167,124
Accrued expenses
Payroll and benefits	124,753		113,026
Research, development and commercial contract costs	115,300		98,411
Product revenue allowances	195,598		119,919
Royalty payable	101,108		73,044
Other	67,736		39,561
Total	$ 604,495	$ 452,547	$ 443,961

Long Term Obligations - Fan Pier Leases (Details) - Fan Pier Leases ft² in Millions	12 Months Ended
	Dec. 31, 2011 ft² lease building
Lessee, Lease, Description [Line Items]
Number of leases \| lease	2
Area of real estate property (in square feet) \| ft²	1.1
Lease agreements number of buildings \| building	2
Optional term of lease agreement (in years)	10 years

Long Term Obligations - San Diego Lease (Details) - San Diego Lease ft² in Thousands, $ in Millions	12 Months Ended
	Dec. 31, 2015 USD ($) ft² term
Property, Plant and Equipment [Line Items]
Area of real estate property (in square feet) \| ft²	170
Length of lease	16 years
Average yearly aggregate rent \| $	$ 10.2
Amount of optional renewal terms \| term	2
Optional renewal term length	5 years

Long Term Obligations Long Term Obligations - Lease Obligations (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Property, Plant and Equipment [Line Items]
Property and equipment, net	$ 812,005	$ 789,437
Fan Pier Leases \| Buildings
Property, Plant and Equipment [Line Items]
Property and equipment, net	462,863	475,725
Construction financing lease obligation	471,058	472,070
San Diego Lease \| Buildings
Property, Plant and Equipment [Line Items]
Property and equipment, net	113,296	94,602
Construction financing lease obligation	$ 96,105	$ 87,392

Long Term Obligations - Revolving Credit Facility (Details)	1 Months Ended
	Feb. 28, 2017 USD ($)	Oct. 31, 2016 USD ($)
Line of Credit Facility [Line Items]
Line of of credit facility, fair value of amount outstanding	$ 300,000,000
Line of credit facility, additional borrowing capacity		$ 300,000,000.0
Line of Credit
Line of Credit Facility [Line Items]
Line of credit facility, current borrowing capacity		$ 500,000,000.0
Debt covenant, consolidated leverage ratio		3.00
Debt covenant, minimum consolidated EBITDA		$ 200,000,000.0
Line of Credit \| Minimum \| Base Rate
Line of Credit Facility [Line Items]
Interest rate (percent)		0.75%
Line of Credit \| Minimum \| Eurodollar
Line of Credit Facility [Line Items]
Interest rate (percent)		1.75%
Line of Credit \| Maximum \| Base Rate
Line of Credit Facility [Line Items]
Interest rate (percent)		1.50%
Line of Credit \| Maximum \| Eurodollar
Line of Credit Facility [Line Items]
Interest rate (percent)		2.50%

Common Stock, Preferred Stock and Equity Plans - Stock and Option Plans (Details)	12 Months Ended
	Dec. 31, 2018 vote shares	Dec. 31, 2017 shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock, shares authorized (shares)	500,000,000	500,000,000
Common stock, number of votes per share \| vote	1
Preferred stock, shares authorized (shares)	1,000,000	1,000,000
Preferred stock, shares issued (shares)	0	0
Preferred stock, shares outstanding (shares)	0	0
Awards outstanding (shares)	12,506,101
Additional awards authorized for grant (shares)	14,737,360
2013 Stock and Option Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Awards outstanding (shares)	10,735,107
Additional awards authorized for grant (shares)	14,737,360
Additional shares authorized (shares)	8,000,000	6,750,000
2006 Stock and Option Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Awards outstanding (shares)	1,770,994
Additional awards authorized for grant (shares)	0
Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expiration period	10 years

Common Stock, Preferred Stock and Equity Plans - Share Repurchase Program (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2018 USD ($) shares
Equity [Abstract]
Number of shares authorized to be repurchased	500,000,000.0
Repurchase of common stock (shares)	2,093,891
Repurchases of common stock \| $	$ 350,043

Common Stock, Preferred Stock and Equity Plans - Outstanding and Vested Stock Options (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Stock Options
Stock options outstanding at beginning of period (in shares)	9,767
Stock options granted (in shares)	2,297
Stock options exercised (in shares)	(3,076)
Stock options forfeited (in shares)	(431)
Stock options expired (in shares)	(6)
Stock options outstanding at end of period (in shares)	8,551	9,767
Stock options exercisable at end of period (in shares)	4,577
Weighted-average Exercise Price
Weighted-average exercise price outstanding at beginning of period (usd per share)	$ 91.57
Weighted average exercise price, granted (usd per share)	164.11
Weighted average exercise price, exercised (usd per share)	85.66
Weighted average exercise price, forfeited (usd per share)	125.37
Weighted average exercise price, expired (usd per share)	98.30
Weighted-average exercise price outstanding at end of period (usd per share)	111.46	$ 91.57
Weighted average exercise price exercisable at the end of the period (usd per share)	$ 93.21
Weighted-average Remaining Contractual Life
Weighted-average Remaining Contractual Life, outstanding (in years)	6 years 11 months 1 day
Weighted-average Remaining Contractual Life, exercisable (in years)	5 years 7 months 17 days
Aggregate Intrinsic Value
Aggregate intrinsic value, outstanding	$ 462,563
Aggregate intrinsic value, exercisable	325,382
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total intrinsic value of stock options exercised	258,200	$ 302,800	$ 48,600
Total cash received from employees as a result of employee stock option exercises	$ 263,400	$ 323,300	$ 48,500
Weighted Average
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Market share price (usd per share)	$ 164.11

Common Stock, Preferred Stock and Equity Plans - Stock Options Outstanding and Exercisable (Details) shares in Thousands	12 Months Ended
	Dec. 31, 2018 $ / shares shares
Stock options outstanding and exercisable
Options outstanding (in shares) \| shares	8,551
Options outstanding, weighted-average remaining contractual life	6 years 11 months 1 day
Options outstanding, weighted-average exercise price (usd per share)	$ 111.46
Options exercisable (in shares) \| shares	4,577
Options exercisable, weighted-average exercise price (usd per share)	$ 93.21
$29.07–$40.00
Stock options outstanding and exercisable
Exercise price, low end of range (usd per share)	29.07
Exercise price, high end of range (usd per share)	$ 40
Options outstanding (in shares) \| shares	532
Options outstanding, weighted-average remaining contractual life	1 year 29 days
Options outstanding, weighted-average exercise price (usd per share)	$ 34.89
Options exercisable (in shares) \| shares	532
Options exercisable, weighted-average exercise price (usd per share)	$ 35.89
$40.01–$60.00
Stock options outstanding and exercisable
Exercise price, low end of range (usd per share)	40.01
Exercise price, high end of range (usd per share)	$ 60
Options outstanding (in shares) \| shares	470
Options outstanding, weighted-average remaining contractual life	3 years 6 months 4 days
Options outstanding, weighted-average exercise price (usd per share)	$ 50.04
Options exercisable (in shares) \| shares	470
Options exercisable, weighted-average exercise price (usd per share)	$ 50.04
$60.01–$80.00
Stock options outstanding and exercisable
Exercise price, low end of range (usd per share)	60.01
Exercise price, high end of range (usd per share)	$ 80
Options outstanding (in shares) \| shares	543
Options outstanding, weighted-average remaining contractual life	5 years 3 months
Options outstanding, weighted-average exercise price (usd per share)	$ 74.90
Options exercisable (in shares) \| shares	533
Options exercisable, weighted-average exercise price (usd per share)	$ 74.89
$80.01–$100.00
Stock options outstanding and exercisable
Exercise price, low end of range (usd per share)	80.01
Exercise price, high end of range (usd per share)	$ 100
Options outstanding (in shares) \| shares	2,839
Options outstanding, weighted-average remaining contractual life	7 years 2 months 5 days
Options outstanding, weighted-average exercise price (usd per share)	$ 89.19
Options exercisable (in shares) \| shares	1,320
Options exercisable, weighted-average exercise price (usd per share)	$ 89.85
$100.01–$120.00
Stock options outstanding and exercisable
Exercise price, low end of range (usd per share)	100.01
Exercise price, high end of range (usd per share)	$ 120.00
Options outstanding (in shares) \| shares	693
Options outstanding, weighted-average remaining contractual life	6 years 1 month 2 days
Options outstanding, weighted-average exercise price (usd per share)	$ 109.30
Options exercisable (in shares) \| shares	603
Options exercisable, weighted-average exercise price (usd per share)	$ 109.22
$120.01–$140.00
Stock options outstanding and exercisable
Exercise price, low end of range (usd per share)	120.01
Exercise price, high end of range (usd per share)	$ 140.00
Options outstanding (in shares) \| shares	839
Options outstanding, weighted-average remaining contractual life	6 years 7 months 13 days
Options outstanding, weighted-average exercise price (usd per share)	$ 130.27
Options exercisable (in shares) \| shares	642
Options exercisable, weighted-average exercise price (usd per share)	$ 130.24
$140.01–$160.00
Stock options outstanding and exercisable
Exercise price, low end of range (usd per share)	140.01
Exercise price, high end of range (usd per share)	$ 160.00
Options outstanding (in shares) \| shares	1,400
Options outstanding, weighted-average remaining contractual life	9 years 22 days
Options outstanding, weighted-average exercise price (usd per share)	$ 155.52
Options exercisable (in shares) \| shares	271
Options exercisable, weighted-average exercise price (usd per share)	$ 155.30
$160.01–$180.00
Stock options outstanding and exercisable
Exercise price, low end of range (usd per share)	160.01
Exercise price, high end of range (usd per share)	$ 160.00
Options outstanding (in shares) \| shares	526
Options outstanding, weighted-average remaining contractual life	8 years 6 months
Options outstanding, weighted-average exercise price (usd per share)	$ 162.94
Options exercisable (in shares) \| shares	156
Options exercisable, weighted-average exercise price (usd per share)	$ 162.94
$180.01–$181.60
Stock options outstanding and exercisable
Exercise price, low end of range (usd per share)	180.01
Exercise price, high end of range (usd per share)	$ 181.6
Options outstanding (in shares) \| shares	709
Options outstanding, weighted-average remaining contractual life	9 years 6 months 11 days
Options outstanding, weighted-average exercise price (usd per share)	$ 181.60
Options exercisable (in shares) \| shares	50
Options exercisable, weighted-average exercise price (usd per share)	$ 181.60

Common Stock, Preferred Stock and Equity Plans - Restricted Stock and Restricted Stock Units and PSUs (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Restricted Stock
Restricted stock and Restricted Stock Units
Beginning of the period (in shares)	1,229
Granted (in shares)	0
Vested (in shares)	(690)
Cancelled (in shares)	(59)
End of the period (in shares)	480	1,229
Restricted stock and Restricted Stock Units, weighted-average grant-date fair value
Weighted-average grant-date fair value, as of the beginning of the period (usd per share)	$ 102.12
Weighted-average grant-date fair value, granted (usd per share)	0.00
Weighted-average grant-date fair value, vested (usd per share)	100.07
Weighted-average grant-date fair value, cancelled (usd per share)	101.55
Weighted-average grant-date fair value, as of the end of the period (usd per share)	$ 104.91	$ 102.12
Restricted stock vested in period, total fair value	$ 114.5	$ 157.0	$ 74.1
Restricted Stock Units (excluding PSUs)
Restricted stock and Restricted Stock Units
Beginning of the period (in shares)	2,011
Granted (in shares)	1,600
Vested (in shares)	(629)
Cancelled (in shares)	(265)
End of the period (in shares)	2,717	2,011
Restricted stock and Restricted Stock Units, weighted-average grant-date fair value
Weighted-average grant-date fair value, as of the beginning of the period (usd per share)	$ 109.27
Weighted-average grant-date fair value, granted (usd per share)	164.70
Weighted-average grant-date fair value, vested (usd per share)	108.02
Weighted-average grant-date fair value, cancelled (usd per share)	132.26
Weighted-average grant-date fair value, as of the end of the period (usd per share)	$ 140.10	$ 109.27
Restricted stock vested in period, total fair value	$ 104.8	$ 33.2	$ 5.3
Performance-based RSUs
Restricted stock and Restricted Stock Units
Beginning of the period (in shares)	484
Granted (in shares)	494
Vested (in shares)	(154)
Cancelled (in shares)	(65)
End of the period (in shares)	759	484
Restricted stock and Restricted Stock Units, weighted-average grant-date fair value
Weighted-average grant-date fair value, as of the beginning of the period (usd per share)	$ 87.59
Weighted-average grant-date fair value, granted (usd per share)	152.40
Weighted-average grant-date fair value, vested (usd per share)	87.13
Weighted-average grant-date fair value, cancelled (usd per share)	99.34
Weighted-average grant-date fair value, as of the end of the period (usd per share)	$ 110.50	$ 87.59
Restricted stock vested in period, total fair value	$ 23.2	$ 1.3
Potential awards, percent of target shares, minimum	0.00%
Potential awards, percent of target shares, maximum	200.00%
Performance-based RSUs \| Tranche one
Restricted stock and Restricted Stock Units, weighted-average grant-date fair value
Percent of awards in tranche	50.00%
Performance period	1 year
Vesting period	3 years
Performance-based RSUs \| Tranche two
Restricted stock and Restricted Stock Units, weighted-average grant-date fair value
Percent of awards in tranche	50.00%
Performance period	3 years
Vesting period	3 years

Common Stock, Preferred Stock and Equity Plans - Performance-based RSUs (PSUs) (Details) - Performance-based RSUs - USD ($) $ / shares in Units, shares in Thousands, $ in Millions	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Restricted stock and Restricted Stock Units
Beginning of the period (in shares)	484
Granted (in shares)	494
Vested (in shares)	(154)
Cancelled (in shares)	(65)
End of the period (in shares)	759	484
Restricted stock and Restricted Stock Units, weighted-average grant-date fair value
Weighted-average grant-date fair value, as of the beginning of the period (usd per share)	$ 87.59
Weighted average fair value (usd per share)	152.40
Weighted-average grant-date fair value, vested (usd per share)	87.13
Weighted-average grant-date fair value, cancelled (usd per share)	99.34
Weighted-average grant-date fair value, as of the end of the period (usd per share)	$ 110.50	$ 87.59
Potential awards, percent of target shares, minimum	0.00%
Potential awards, percent of target shares, maximum	200.00%
Restricted stock vested in period, total fair value	$ 23.2	$ 1.3
Tranche one
Restricted stock and Restricted Stock Units, weighted-average grant-date fair value
Percent of awards in tranche	50.00%
Performance period	1 year
Vesting period	3 years
Tranche two
Restricted stock and Restricted Stock Units, weighted-average grant-date fair value
Percent of awards in tranche	50.00%
Performance period	3 years
Vesting period	3 years

Common Stock, Preferred Stock and Equity Plans - Employee Stock Purchase Plan (Details) - ESPP share issuances	12 Months Ended
	Dec. 31, 2018 period $ / shares shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of purchase periods \| period	2
Duration of purchase period	6 months
Offering period (in months)	12 months
Eligible employee purchase price percentage of fair value	85.00%
Number of shares authorized (shares)	402,602
Number of shares (shares)	213,654,000
Average price paid per share (usd per share) \| $ / shares	$ 117.52

Stock-based Compensation Expense (Details) - USD ($)	12 Months Ended
Stock-based Compensation Expense (Details) - USD ($)	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Stock-based compensation expense:
Stock-based compensation expense	$ 325,047,000	$ 293,236,000	$ 240,623,000
Stock-based compensation expense related to inventories	(585,000)	(2,406,000)	(689,000)
Allocated stock-based compensation expense	325,047,000	$ 293,236,000	$ 240,623,000
Stock Options
Weighted-average assumptions for options and ESPP subscriptions granted
Expected annual dividends	$ 0
Employee stock purchase plan
Weighted-average assumptions for options and ESPP subscriptions granted
Expected stock price volatility (percent)	36.51%	39.09%	48.22%
Risk-free interest rate (percent)	2.36%	1.24%	0.56%
Expected term of options (in years)	9 months	9 months	9 months
Expected annual dividends	$ 0	$ 0	$ 0
Weighted average fair value (usd per share)	$ 44.04	$ 35.90	$ 26.86
Tranche one
Weighted-average assumptions for options and ESPP subscriptions granted
Vesting rights percentage	33.30%
Tranche two
Weighted-average assumptions for options and ESPP subscriptions granted
Vesting rights percentage	33.30%
Tranche three
Weighted-average assumptions for options and ESPP subscriptions granted
Vesting rights percentage	33.30%
Performance-based RSUs
Weighted-average assumptions for options and ESPP subscriptions granted
Potential awards, percent of target shares, minimum	0.00%
Potential awards, percent of target shares, maximum	200.00%
Weighted average fair value (usd per share)	$ 152.40
Performance-based RSUs \| Tranche one
Weighted-average assumptions for options and ESPP subscriptions granted
Vesting period	3 years
Performance-based RSUs \| Tranche two
Weighted-average assumptions for options and ESPP subscriptions granted
Vesting period	3 years
Financial performance shares
Weighted-average assumptions for options and ESPP subscriptions granted
Vesting period	3 years
Non-financial performance shares
Weighted-average assumptions for options and ESPP subscriptions granted
Vesting period	3 years
Stock options
Stock-based compensation expense:
Stock-based compensation expense	$ 107,854,000	$ 105,367,000	$ 114,768,000
Type of award:
Unrecognized Expense	$ 155,465,000
Weighted-average Recognition Period	2 years 7 months 21 days
Weighted-average grant-date fair value, granted (usd per share)	$ 60.83	$ 43.27	$ 37.93
Weighted-average assumptions for options and ESPP subscriptions granted
Expected stock price volatility (percent)	40.50%	45.31%	46.77%
Risk-free interest rate (percent)	2.61%	1.94%	1.32%
Expected term of options (in years)	4 years 6 months 18 days	4 years 8 months 5 days	4 years 10 months 28 days
Expected annual dividends	$ 0	$ 0	$ 0
Restricted stock and restricted stock units (including PSUs)
Stock-based compensation expense:
Stock-based compensation expense	207,845,000	181,258,000	118,709,000
Type of award:
Unrecognized Expense	$ 321,683,000
Weighted-average Recognition Period	2 years 6 months 29 days
ESPP share issuances
Stock-based compensation expense:
Stock-based compensation expense	$ 9,933,000	9,017,000	7,835,000
Type of award:
Unrecognized Expense	$ 5,132,000
Weighted-average Recognition Period	6 months 29 days
Cost of sales
Stock-based compensation expense:
Stock-based compensation expense	$ 4,543,000	2,500,000	2,918,000
Research and development expenses
Stock-based compensation expense:
Stock-based compensation expense	203,112,000	181,900,000	153,451,000
Sales, general and administrative expenses
Stock-based compensation expense:
Stock-based compensation expense	$ 117,392,000	$ 108,836,000	$ 84,254,000

Income Taxes - Components of Income and Provision for (Benefit from) Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Components of income (loss) before provision for (benefit from) income taxes
United States									$ 812,086	$ 330,340	$ (147,860)
Foreign									(211,845)	(346,029)	80,494
Income (loss) before (benefit from) provision for income taxes	$ 32,497	$ 136,511	$ 216,591	$ 214,642	$ 112,442	$ (417,170)	$ 35,506	$ 253,533	600,241	(15,689)	(67,366)
Current taxes:
United States									772	11,559	(3,821)
Foreign									15,600	3,576	1,794
State									9,018	5,025	1,836
Total current taxes									25,390	20,160	(191)
Deferred taxes:
United States									(1,105,053)	(113,805)	18,659
Foreign									(364,919)	(3,222)	(3,359)
State									(42,280)	(10,457)	1,556
Total deferred taxes									(1,512,252)	(127,484)	16,856
(Benefit from) provision for income taxes	$ (1,492,599)	$ 8,055	$ 10,341	$ (12,659)	$ 10,257	$ (125,903)	$ 4,337	$ 3,985	$ (1,486,862)	$ (107,324)	$ 16,665

Income Taxes - Narrative (Details) - USD ($)	3 Months Ended								12 Months Ended
Income Taxes - Narrative (Details) - USD ($)	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Tax Carryforwards
Income tax (benefit) resulting in the release of valuation allowance	$ (1,560,000,000)
(Benefit from) provision for income taxes	(1,492,599,000)	$ 8,055,000	$ 10,341,000	$ (12,659,000)	$ 10,257,000	$ (125,903,000)	$ 4,337,000	$ 3,985,000	$ (1,486,862,000)	$ (107,324,000)	$ 16,665,000
Increase (decrease) in valuation allowance										(178,200,000)	14,800,000
Deferred tax liabilities recognized in other liabilities, excluding current portion	0				6,341,000				0	6,341,000
Operating loss carryforwards	2,900,000,000				775,500,000				2,900,000,000	775,500,000
Tax credit carryforwards	350,700,000				134,900,000				350,700,000	134,900,000
Valuation allowance	168,491,000				1,552,942,000				168,491,000	1,552,942,000
Unrecognized tax benefits	19,549,000				3,814,000				19,549,000	3,814,000	0	$ 425,000
Income tax penalties and interest accrued	0								0
Variable Interest Entity, Primary Beneficiary
Tax Carryforwards
(Benefit from) provision for income taxes									(3,668,000)	(114,090,000)	$ 16,743,000
Deferred tax liabilities recognized in other liabilities, excluding current portion					$ 4,756,000					$ 4,756,000
Domestic and Foreign Tax Authority
Tax Carryforwards
Valuation allowance	168,500,000								168,500,000
Foreign Tax Authority
Tax Carryforwards
Operating loss carryforwards	942,000,000								942,000,000
Operating loss carryforwards, subject to expiration	7,600,000								7,600,000
Operating loss carryforwards, not subject to expiration	934,400,000								934,400,000
Deferred Tax Assets
Tax Carryforwards
Unrecognized tax benefits	7,600,000								7,600,000
Accrued Expenses
Tax Carryforwards
Unrecognized tax benefits	$ 11,900,000								$ 11,900,000

Income Taxes - Effective Income Tax Reconciliation (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Reconciliation of Income Tax Expense:
Income (loss) before (benefit from) provision for income taxes	$ 32,497	$ 136,511	$ 216,591	$ 214,642	$ 112,442	$ (417,170)	$ 35,506	$ 253,533	$ 600,241	$ (15,689)	$ (67,366)
Expected provision for (benefit from) income taxes									126,051	(5,491)	(23,578)
State taxes, net of federal benefit									8,680	4,742	3,621
Foreign income tax rate differential									23,427	77,801	21,346
Tax credits									(52,629)	(58,204)	(47,773)
(Benefit from) provision for income taxes attributable to valuation allowances									(1,563,169)	(575,801)	14,837
Permanent items									1,421	15,324	24,663
Rate change									0	575,192	12,836
Stock compensation (benefit) shortfalls and cancellations									(49,044)	(21,453)	4,162
Officer’s compensation									8,310	6,501	86
Tax attribute expiration									0	0	9,947
Deconsolidation of VIE									(9,390)	(126,183)	0
Uncertain tax positions									15,431	0	0
Other									4,050	248	(3,482)
(Benefit from) provision for income taxes	$ (1,492,599)	$ 8,055	$ 10,341	$ (12,659)	$ 10,257	$ (125,903)	$ 4,337	$ 3,985	$ (1,486,862)	$ (107,324)	$ 16,665

Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Deferred tax assets:
Net operating loss	$ 882,014	$ 1,004,404
Tax credit carryforwards	487,635	440,429
Intangible assets	241,775	54,091
Deferred revenues	19,311	19,593
Stock-based compensation	93,915	83,196
Accrued expenses	17,795	17,808
Construction financing lease obligation	130,849	109,354
Other	6,831	5,667
Gross deferred tax assets	1,880,125	1,734,542
Valuation allowance	(168,491)	(1,552,942)
Total deferred tax assets	1,711,634	181,600
Deferred tax liabilities:
Property and equipment	(128,407)	(101,019)
Acquired intangibles	0	(6,341)
Deferred revenue	(73,357)	(73,357)
Unrealized gain	(10,198)	(6,401)
Net deferred tax assets	$ 1,499,672	834
Net deferred tax liabilities		$ (5,518)

Income Taxes - Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward]
Balance at beginning of the period	$ 3,814	$ 0	$ 425
Increases related to current period tax positions	9,704	3,814	0
Increases related to prior period tax positions	6,031	0	0
Decrease due to statute limitations	0	0	(425)
Balance at end of period	$ 19,549	$ 3,814	$ 0

Employee Benefits (Details) - USD ($) $ in Millions	12 Months Ended
Employee Benefits (Details) - USD ($) $ in Millions	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Retirement Benefits [Abstract]
Maximum percentage of annual compensation contributed by the participant (percent)	60.00%
Company contribution	$ 13.9	$ 12.3	$ 11.8

Commitments and Contingencies - Lease Commitments (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Future minimum commitments under facility leases commitments with terms of more than one year
2019	$ 85,071
2020	95,986
2021	94,245
2022	93,761
2023	94,071
Thereafter	575,191
Total minimum lease payments	1,038,325
Sublease income 2018	6,200
Rental expense	17,300	$ 19,200	$ 19,100
Fan Pier Leases
Future minimum commitments under facility leases commitments with terms of more than one year
2019	66,540
2020	72,589
2021	72,589
2022	72,589
2023	72,589
Thereafter	389,855
Total minimum lease payments	746,751
San Diego Lease
Future minimum commitments under facility leases commitments with terms of more than one year
2019	5,324
2020	9,127
2021	9,127
2022	9,127
2023	9,530
Thereafter	119,864
Total minimum lease payments	162,099
Other Leases
Future minimum commitments under facility leases commitments with terms of more than one year
2019	13,207
2020	14,270
2021	12,529
2022	12,045
2023	11,952
Thereafter	65,472
Total minimum lease payments	$ 129,475

Commitments and Contingencies - Capital Lease Financing Obligations (Details) $ in Thousands	Dec. 31, 2018 USD ($)
Capital Leases, Future Minimum Payments Due [Abstract]
2019	$ 10,770
2020	7,282
2021	5,649
2022	3,300
2023	1,974
Thereafter	3,085
Total payments	32,060
Less: amount representing interest	(2,585)
Present value of payments	$ 29,475
Minimum
Capital Leased Assets
Effective interest rate (less than for minimum)	1.00%
Maximum
Capital Leased Assets
Effective interest rate (less than for minimum)	6.00%

Commitments and Contingencies - Contingencies (Details) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Commitments and Contingencies Disclosure [Abstract]
Indemnification claims	$ 0
Contingent liabilities	$ 0	$ 0

Segment Information - Revenues by Product (Details) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2018 USD ($)	Sep. 30, 2018 USD ($)	Jun. 30, 2018 USD ($)	Mar. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)	Sep. 30, 2017 USD ($)	Jun. 30, 2017 USD ($)	Mar. 31, 2017 USD ($)	Dec. 31, 2018 USD ($) segment	Dec. 31, 2017 USD ($)	Dec. 31, 2016 USD ($)
Segment Reporting [Abstract]
Number of operating segments \| segment									1
Revenue from External Customer [Line Items]
Product revenues, net	$ 870,106	$ 784,535	$ 752,157	$ 640,799	$ 651,634	$ 578,165	$ 544,135	$ 714,718	$ 3,047,597	$ 2,488,652	$ 1,702,177
SYMDEKO/SYMKEVI
Revenue from External Customer [Line Items]
Product revenues, net									768,657	0	0
ORKAMBI
Revenue from External Customer [Line Items]
Product revenues, net									1,262,166	1,320,850	979,590
KALYDECO
Revenue from External Customer [Line Items]
Product revenues, net									1,007,502	844,630	703,432
Other
Revenue from External Customer [Line Items]
Product revenues, net									0	0	610
Product
Revenue from External Customer [Line Items]
Product revenues, net	$ 868,173	$ 782,511	$ 749,912	$ 637,729	$ 621,228	$ 549,642	$ 513,988	$ 480,622	$ 3,038,325	$ 2,165,480	$ 1,683,632

Segment Information - Revenue by Geographic Location (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	$ 870,106	$ 784,535	$ 752,157	$ 640,799	$ 651,634	$ 578,165	$ 544,135	$ 714,718	$ 3,047,597	$ 2,488,652	$ 1,702,177
United States
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues									2,365,079	1,986,786	1,321,807
Europe
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues									543,179	420,317	320,456
Other
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues									139,339	81,549	59,914
Total revenues outside of the United States
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues									$ 682,518	$ 501,866	$ 380,370

Segment Information - Significant Customers (Details) - Credit Concentration Risk	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Revenues, Net \| Walgreen Co.
Concentration Risk [Line Items]
Concentration risk percentage (less than for CVS/Caremark 2017 revenue)	20.00%	17.00%	19.00%
Revenues, Net \| Accredo/Curascript
Concentration Risk [Line Items]
Concentration risk percentage (less than for CVS/Caremark 2017 revenue)	14.00%	14.00%	15.00%
Revenues, Net \| McKesson Corporation
Concentration Risk [Line Items]
Concentration risk percentage (less than for CVS/Caremark 2017 revenue)	14.00%	10.00%	10.00%
Revenues, Net \| CVS/Caremark
Concentration Risk [Line Items]
Concentration risk percentage (less than for CVS/Caremark 2017 revenue)		10.00%	19.00%
Accounts Receivable \| Walgreen Co.
Concentration Risk [Line Items]
Concentration risk percentage (less than for CVS/Caremark 2017 revenue)	16.00%	20.00%
Accounts Receivable \| Accredo/Curascript
Concentration Risk [Line Items]
Concentration risk percentage (less than for CVS/Caremark 2017 revenue)	10.00%	12.00%
Accounts Receivable \| McKesson Corporation
Concentration Risk [Line Items]
Concentration risk percentage (less than for CVS/Caremark 2017 revenue)	16.00%	10.00%

Segment Information - Property and Equipment, Net by Location (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Revenues from External Customers and Long-Lived Assets [Line Items]
Property and equipment, net	$ 812,005	$ 789,437
United States
Revenues from External Customers and Long-Lived Assets [Line Items]
Property and equipment, net	778,157	753,128
United Kingdom
Revenues from External Customers and Long-Lived Assets [Line Items]
Property and equipment, net	30,496	31,279
Other
Revenues from External Customers and Long-Lived Assets [Line Items]
Property and equipment, net	3,352	5,030
Total revenues outside of the United States
Revenues from External Customers and Long-Lived Assets [Line Items]
Property and equipment, net	$ 33,848	$ 36,309

Quarterly Financial Data (unaudited) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Revenues:
Product revenues, net	$ 870,106	$ 784,535	$ 752,157	$ 640,799	$ 651,634	$ 578,165	$ 544,135	$ 714,718	$ 3,047,597	$ 2,488,652	$ 1,702,177
Costs and expenses:
Cost of sales	122,289	111,255	104,382	71,613	84,052	72,874	71,205	46,988	409,539	275,119	210,460
Research and development expenses	437,881	330,510	337,532	310,553	306,664	454,947	289,451	273,563	1,416,476	1,324,625	1,047,690
Sales, general and administrative expenses	153,210	137,295	137,303	129,808	134,794	120,710	127,249	113,326	557,616	496,079	432,829
Restructuring (income) expenses	4	(174)	62	(76)	387	337	3,523	9,999	(184)	14,246	1,262
Intangible asset impairment charges	29,000	0	0	0	0	255,340	0	0	29,000	255,340	0
Total costs and expenses	742,384	578,886	579,279	511,898	525,897	904,208	491,428	443,876	2,412,447	2,365,409	1,692,241
Income from operations	127,722	205,649	172,878	128,901	125,737	(326,043)	52,707	270,842	635,150	123,243	9,936
Interest expense, net	(4,773)	(8,143)	(10,106)	(11,097)	(12,547)	(13,574)	(14,664)	(16,765)	(34,119)	(57,550)	(81,432)
Other (expense) income, net	(90,452)	(60,995)	53,819	96,838	(748)	(77,553)	(2,537)	(544)	(790)	(81,382)	4,130
Income (loss) before (benefit from) provision for income taxes	32,497	136,511	216,591	214,642	112,442	(417,170)	35,506	253,533	600,241	(15,689)	(67,366)
Provision for (benefit from) income taxes	(1,492,599)	8,055	10,341	(12,659)	10,257	(125,903)	4,337	3,985	(1,486,862)	(107,324)	16,665
Net income (loss)	1,525,096	128,456	206,250	227,301	102,185	(291,267)	31,169	249,548	2,087,103	91,635	(84,031)
Loss (income) attributable to noncontrolling interest	25,431	290	1,110	(17,038)	(1,501)	188,315	(13,173)	(1,792)	9,793	171,849	(28,021)
Net income (loss) attributable to Vertex common shareholders	$ 1,550,527	$ 128,746	$ 207,360	$ 210,263	$ 100,684	$ (102,952)	$ 17,996	$ 247,756	$ 2,096,896	$ 263,484	$ (112,052)
Net income:
Basic (usd per share)	$ 6.08	$ 0.51	$ 0.82	$ 0.83	$ 0.40	$ (0.41)	$ 0.07	$ 1.01	$ 8.24	$ 1.06	$ (0.46)
Diluted (usd per share)	$ 5.97	$ 0.50	$ 0.80	$ 0.81	$ 0.39	$ (0.41)	$ 0.07	$ 0.99	$ 8.09	$ 1.04	$ (0.46)
Shares used in per share calculations:
Basic (in shares)	254,868	254,905	254,135	253,231	251,557	250,268	247,521	246,024	254,292	248,858	244,685
Diluted (in shares)	259,812	259,788	258,584	258,526	256,804	250,268	251,635	248,700	259,185	253,225	244,685
Product revenues, net
Revenues:
Product revenues, net	$ 868,173	$ 782,511	$ 749,912	$ 637,729	$ 621,228	$ 549,642	$ 513,988	$ 480,622	$ 3,038,325	$ 2,165,480	$ 1,683,632
Collaborative and royalty revenues
Revenues:
Product revenues, net	$ 1,933	$ 2,024	$ 2,245	$ 3,070	$ 30,406	$ 28,523	$ 30,147	$ 234,096	$ 9,272	$ 323,172	$ 18,545

Quarterly Financial Data (unaudited) Quarterly Financial Data (unaudited) Additional Information (Details) - USD ($)	1 Months Ended		3 Months Ended								12 Months Ended
	Dec. 31, 2018	Jul. 30, 2017	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Schedule of Collaborative Arrangement Agreements [Line Items]
Intangible asset impairment charges			$ 29,000,000	$ 0	$ 0	$ 0	$ 0	$ 255,340,000	$ 0	$ 0	$ 29,000,000	$ 255,340,000	$ 0
Income tax (benefit) resulting in the release of valuation allowance			(1,560,000,000)
Provision for (benefit from) income taxes			$ (1,492,599,000)	$ 8,055,000	$ 10,341,000	(12,659,000)	10,257,000	(125,903,000)	4,337,000	3,985,000	(1,486,862,000)	(107,324,000)	16,665,000
Merck KGaA and Arbor
Schedule of Collaborative Arrangement Agreements [Line Items]
Collaborative arrangement, development and commercialization rights potential maximum milestone payments								95,000,000
BioAxone Biosciences, Inc
Schedule of Collaborative Arrangement Agreements [Line Items]
Up-front payment						$ 10,000,000					10,000,000				$ 10,000,000
Merck KGaA
Schedule of Collaborative Arrangement Agreements [Line Items]
Up-front payment	$ 65,000,000									$ 230,000,000.0
Parion Sciences, Inc
Schedule of Collaborative Arrangement Agreements [Line Items]
Up-front payment											85,000,000			$ 85,000,000
Collaborative revenues								20,000,000	$ 20,000,000
Intangible asset impairment charges								255,300,000
Business combination, contingent consideration arrangements, change in amount of contingent consideration, liability								(69,600,000)
Provision for (benefit from) income taxes								(126,200,000)
Janssen
Schedule of Collaborative Arrangement Agreements [Line Items]
Up-front payment															$ 35,000,000
Collaborative revenues							$ 25,000,000
Concert Pharmaceuticals
Schedule of Collaborative Arrangement Agreements [Line Items]
Collaborative arrangement, development and commercialization rights potential maximum milestone payments		$ 160,000,000						160,000,000
Variable Interest Entity, Primary Beneficiary
Schedule of Collaborative Arrangement Agreements [Line Items]
Business combination, contingent consideration arrangements, change in amount of contingent consideration, liability											17,730,000	(62,560,000)	54,850,000
Provision for (benefit from) income taxes											(3,668,000)	(114,090,000)	16,743,000
Variable Interest Entity, Primary Beneficiary \| BioAxone Biosciences, Inc
Schedule of Collaborative Arrangement Agreements [Line Items]
Business combination, contingent consideration arrangements, change in amount of contingent consideration, liability												900,000	(9,950,000)
Variable Interest Entity, Primary Beneficiary \| Parion Sciences, Inc
Schedule of Collaborative Arrangement Agreements [Line Items]
Collaborative revenues												40,000,000
Business combination, contingent consideration arrangements, change in amount of contingent consideration, liability											0	(63,460,000)	$ 64,800,000
Provision for (benefit from) income taxes												14,800,000
Other Intangible Assets \| Variable Interest Entity, Primary Beneficiary \| BioAxone Biosciences, Inc
Schedule of Collaborative Arrangement Agreements [Line Items]
Intangible asset impairment charges								29,000,000
Provision for (benefit from) income taxes											$ (7,900,000)
Other Intangible Assets \| Variable Interest Entity, Primary Beneficiary \| Parion Sciences, Inc
Schedule of Collaborative Arrangement Agreements [Line Items]
Intangible asset impairment charges								$ 255,300,000				255,300,000
Provision for (benefit from) income taxes												$ (97,700,000)