0000875320-21-000006 | 10-K | XBRL Viewer | Vertex Pharmaceuticals INC MA

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Cover Page - USD ($) $ in Billions	12 Months Ended
Cover Page - USD ($) $ in Billions	Dec. 31, 2020	Jan. 31, 2021	Jun. 30, 2020
Cover [Abstract]
Document Type	10-K
Document Annual Report	true
Document Period End Date	Dec. 31, 2020
Document Transition Report	false
Entity File Number	000-19319
Entity Registrant Name	VERTEX PHARMACEUTICALS INC / MA
Entity Incorporation, State or Country Code	MA
Entity Tax Identification Number	04-3039129
Entity Address, Address Line One	50 Northern Avenue
Entity Address, City or Town	Boston
Entity Address, State or Province	MA
Entity Address, Postal Zip Code	02210
City Area Code	617
Local Phone Number	341-6100
Title of 12(b) Security	Common Stock, $0.01 Par Value Per Share
Trading Symbol	VRTX
Security Exchange Name	NASDAQ
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
ICFR Auditor Attestation Flag	true
Entity Shell Company	false
Entity Public Float			$ 74.8
Entity Common Stock, Shares Outstanding		259,960,062
Documents Incorporated by Reference	Portions of the definitive proxy statement for the 2021 Annual Meeting of Shareholders, which we expect to hold on May 19, 2021, are incorporated by reference into Part III of this Annual Report on Form 10-K.
Entity Central Index Key	0000875320
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	FY
Amendment Flag	false

Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Revenues:
Revenues	$ 6,205,683	$ 4,162,821	$ 3,047,597
Costs and expenses:
Cost of sales	736,300	547,758	409,539
Research and development expenses	1,829,537	1,754,540	1,416,476
Sales, general and administrative expenses	770,456	658,498	557,616
Change in fair value of contingent consideration	13,100	4,459	0
Restructuring income	0	0	(184)
Intangible asset impairment charge	0	0	29,000
Total costs and expenses	3,349,393	2,965,255	2,412,447
Income from operations	2,856,290	1,197,566	635,150
Interest income	22,239	63,678	38,352
Interest expense	(58,151)	(58,502)	(72,471)
Other income (expense), net	296,420	192,177	(790)
Income before provision for (benefit from) income taxes	3,116,798	1,394,919	600,241
Provision for (benefit from) income taxes	405,151	218,109	(1,486,862)
Net income	2,711,647	1,176,810	2,087,103
Loss attributable to noncontrolling interest	0	0	9,793
Net income attributable to Vertex	$ 2,711,647	$ 1,176,810	$ 2,096,896
Net income:
Basic ( in usd per share)	$ 10.44	$ 4.58	$ 8.24
Diluted (in usd per share)	$ 10.29	$ 4.51	$ 8.09
Shares used in per share calculations:
Basic (in shares)	259,841	256,728	254,292
Diluted (in shares)	263,396	260,673	259,185
Product revenues, net
Revenues:
Revenues	$ 6,202,783	$ 4,160,726	$ 3,038,325
Collaborative and royalty revenues
Revenues:
Revenues	$ 2,900	$ 2,095	$ 9,272

Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Statement of Comprehensive Income [Abstract]
Net income	$ 2,711,647	$ 1,176,810	$ 2,087,103
Changes in other comprehensive income:
Unrealized holding (losses) gains on marketable securities, net	(169)	1,039	58
Unrealized (losses) gains on foreign currency forward contracts, net of tax of $14.3 million, $7.0 million and $(7.1) million, respectively	(51,555)	(14,003)	27,438
Foreign currency translation adjustment	(14,783)	10,332	8,855
Total other comprehensive (loss) income	(66,507)	(2,632)	36,351
Comprehensive income	2,645,140	1,174,178	2,123,454
Comprehensive loss attributable to noncontrolling interest	0	0	9,793
Comprehensive income attributable to Vertex	$ 2,645,140	$ 1,174,178	$ 2,133,247

Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Statement of Comprehensive Income [Abstract]
Unrealized (losses) gains on foreign currency forward contracts, tax	$ 14,300	$ 7,000	$ (7,100)

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Current assets:
Cash and cash equivalents	$ 5,988,187	$ 3,109,322
Marketable securities	670,710	698,972
Accounts receivable, net	885,352	633,518
Inventories	280,777	167,502
Prepaid expenses and other current assets	308,353	213,515
Total current assets	8,133,379	4,822,829
Property and equipment, net	958,534	745,080
Goodwill	1,002,158	1,002,158
Intangible assets	400,000	400,000
Deferred tax assets	882,779	1,190,815
Operating lease assets	325,564	88,202
Other assets	49,394	69,381
Total assets	11,751,808	8,318,465
Current liabilities:
Accounts payable	155,139	87,610
Accrued expenses	1,404,971	1,116,912
Other current liabilities	317,423	130,305
Total current liabilities	1,877,533	1,334,827
Long-term finance lease liabilities	539,042	538,576
Long-term operating lease liabilities	350,463	84,292
Long-term contingent consideration	189,600	176,500
Other long-term liabilities	108,355	99,026
Total liabilities	3,064,993	2,233,221
Commitments and contingencies	0	0
Shareholders’ equity:
Preferred stock, $0.01 par value; 1,000 shares authorized; none issued and outstanding	0	0
Common stock, $0.01 par value; 500,000 shares authorized, 259,890 and 258,993 shares issued and outstanding, respectively	2,599	2,589
Additional paid-in capital	7,894,027	7,937,606
Accumulated other comprehensive loss	(68,480)	(1,973)
Retained earnings (accumulated deficit)	858,669	(1,852,978)
Total shareholders’ equity	8,686,815	6,085,244
Total liabilities and shareholders’ equity	$ 11,751,808	$ 8,318,465

Consolidated Balance Sheets (Parenthetical) - $ / shares	Dec. 31, 2020	Dec. 31, 2019
Statement of Financial Position [Abstract]
Preferred stock, par value ( in usd per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized (in shares)	1,000,000	1,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common stock, par value ( in usd per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	500,000,000	500,000,000
Common stock, shares issued (in shares)	259,890,000	258,993,000
Common stock, shares outstanding (in shares)	259,890,000	258,993,000

Consolidated Statements of Shareholders' Equity and Noncontrolling Interest - USD ($) shares in Thousands, $ in Thousands	Total	Cumulative Effect, Period of Adoption, Adjustment	Total Vertex Shareholders’ Equity	Total Vertex Shareholders’ Equity Cumulative Effect, Period of Adoption, Adjustment	Common Stock	Additional Paid-in Capital	Accumulated Other Comprehensive Income (Loss)	Accumulated Other Comprehensive Income (Loss) Cumulative Effect, Period of Adoption, Adjustment	Retained Earnings (Accumulated Deficit)	Retained Earnings (Accumulated Deficit) Cumulative Effect, Period of Adoption, Adjustment	Noncontrolling Interest
Beginning balance (in shares) at Dec. 31, 2017					253,253
Balance at Dec. 31, 2017	$ 2,042,306	$ 9,229	$ 2,028,579	$ 9,229	$ 2,512	$ 7,157,362	$ (11,572)	$ (24,120)	$ (5,119,723)	$ 33,349	$ 13,727
Increase (Decrease) in Stockholders' Equity
Other comprehensive (loss) income, net of tax	36,351		36,351				36,351
Net income (loss)	2,087,103		2,096,896						2,096,896		(9,793)
Repurchases of common stock (in shares)					(2,094)
Repurchases of common stock	(350,043)		(350,043)		$ (21)	(350,022)
Issuance of common stock under benefit plans (in shares)					4,013
Issuance of common stock under benefit plans	288,535		288,535		$ 55	288,480
Stock-based compensation expense	325,656		325,656			325,656
VIE noncontrolling interest upon deconsolidation	(3,540)										(3,540)
Other VIE activity	(394)										(394)
Ending balance (in shares) at Dec. 31, 2018					255,172
Balance at Dec. 31, 2018	4,435,203	$ (40,310)	4,435,203	$ (40,310)	$ 2,546	7,421,476	659	$ (24,120)	(2,989,478)	$ (40,310)	0
Increase (Decrease) in Stockholders' Equity
Other comprehensive (loss) income, net of tax	(2,632)		(2,632)				(2,632)
Net income (loss)	1,176,810		1,176,810						1,176,810
Repurchases of common stock (in shares)					(1,046)
Repurchases of common stock	(186,020)		(186,020)		$ (10)	(186,010)
Common stock withheld for employee tax obligations (in shares)					(28)
Common stock withheld for employee tax obligations	(5,995)		(5,995)			(5,995)
Issuance of common stock under benefit plans (in shares)					4,895
Issuance of common stock under benefit plans	345,979		345,979		$ 53	345,926
Stock-based compensation expense	362,209		362,209			362,209
Ending balance (in shares) at Dec. 31, 2019					258,993
Balance at Dec. 31, 2019	6,085,244		6,085,244		$ 2,589	7,937,606	(1,973)		(1,852,978)		0
Increase (Decrease) in Stockholders' Equity
Other comprehensive (loss) income, net of tax	(66,507)		(66,507)				(66,507)
Net income (loss)	2,711,647		2,711,647						2,711,647
Repurchases of common stock (in shares)					(2,405)
Repurchases of common stock	(539,136)		(539,136)		$ (24)	(539,112)
Common stock withheld for employee tax obligations (in shares)					(804)
Common stock withheld for employee tax obligations	(200,271)		(200,271)		$ (8)	(200,263)
Issuance of common stock under benefit plans (in shares)					4,106
Issuance of common stock under benefit plans	262,768		262,768		$ 42	262,726
Stock-based compensation expense	433,070		433,070			433,070
Ending balance (in shares) at Dec. 31, 2020					259,890
Balance at Dec. 31, 2020	$ 8,686,815		$ 8,686,815		$ 2,599	$ 7,894,027	$ (68,480)		$ 858,669		$ 0

Consolidated Statements of Cash Flows - USD ($)
$ in Thousands

12 Months Ended

Dec. 31, 2020

Dec. 31, 2019

Dec. 31, 2018

Cash flows from operating activities:

Net income

$ 2,711,647

$ 1,176,810

$ 2,087,103

Adjustments to reconcile net income to net cash provided by operating activities:

Stock-based compensation expense

429,461

360,489

325,047

Depreciation expense

109,515

106,941

72,420

Deferred income taxes (including benefit from valuation allowance release in 2018)

277,341

167,387

(1,512,325)

Gains on equity securities

(311,937)

(197,597)

(2,558)

Increase in fair value of contingent consideration

13,100

4,459

Intangible asset impairment charge

29,000

Other non-cash items, net

78,832

16,942

33,579

Changes in operating assets and liabilities:

Accounts receivable, net

(223,444)

(225,587)

(108,152)

Inventories

(132,014)

(64,047)

(31,965)

Prepaid expenses and other assets

(297,562)

35,440

16,684

Accounts payable

51,276

(22,785)

36,554

Accrued expenses

122,198

172,881

302,755

Other liabilities

425,092

37,997

22,144

Net cash provided by operating activities

3,253,505

1,569,330

1,270,286

Cash flows from investing activities:

Payments to acquire businesses, net of cash acquired

(1,154,212)

Purchases of available-for-sale debt securities

(431,396)

(537,196)

(431,918)

Maturities of available-for-sale debt securities

372,342

475,924

431,576

Sale of equity securities

437,567

94,936

Purchases of property and equipment

(259,798)

(75,451)

(95,449)

Investment in equity securities

(19,327)

(39,319)

(83,471)

Investment in note receivable

(15,000)

Decrease in restricted cash due to deconsolidation of VIE

(7,896)

Net cash provided by (used in) investing activities

99,388

(1,235,318)

(202,158)

Cash flows from financing activities:

Issuances of common stock under benefit plans

264,946

343,244

289,293

Repurchases of common stock

(539,136)

(186,020)

(350,043)

Payments in connection with common stock withheld for employee tax obligations

(200,271)

(5,995)

Payments on finance leases

^[1]

(42,275)

(39,185)

(33,388)

Proceeds from finance leases

^[1]

13,251

10,046

20,840

Other financing activities

(1,796)

4,683

2,079

Net cash (used in) provided by financing activities

(505,281)

126,773

(71,219)

Effect of changes in exchange rates on cash

20,552

1,643

(6,182)

Net increase in cash, cash equivalents and restricted cash

2,868,164

462,428

990,727

Cash, cash equivalents and restricted cash—beginning of period

3,120,681

2,658,253

1,667,526

Cash, cash equivalents and restricted cash—end of period

5,988,845

3,120,681

2,658,253

Supplemental disclosure of cash flow information:

Cash paid for interest

54,520

55,554

66,458

Cash paid for income taxes

191,776

24,730

12,402

Capitalization of costs related to construction financing lease obligation

^[1]

3,389

Issuances of common stock from employee benefit plans receivable

$ 642

$ 2,820

$ 86

[1]	* For the year ended December 31, 2018, amounts are related to the Company’s capital leases and construction financing lease obligations pursuant to ASC 840, Leases, which was applicable until December 31, 2018.

Nature of Business and Accounting Policies

12 Months Ended

Dec. 31, 2020

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 TRIKAFTA/KAFTRIO (elexacaftor/tezacaftor/ivacaftor and ivacaftor), SYMDEKO/SYMKEVI (tezacaftor in combination with ivacaftor), ORKAMBI (lumacaftor in combination with ivacaftor) and KALYDECO (ivacaftor), which are approved to treat people with CF who have specific mutations in their cystic fibrosis transmembrane conductance regulator (“CFTR”) gene.

As of December 31, 2020, the Company had cash, cash equivalents and marketable securities of $6.7 billion. The Company expects that cash flows from the sales of its products, together with its cash, cash equivalents and marketable securities, will be sufficient to fund its operations for at least the next twelve months.

The Company 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 accompanying consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), reflect the operations of (i) the Company, (ii) its wholly-owned subsidiaries and (iii) a consolidated variable interest entity (“VIE”). In 2018, the Company deconsolidated BioAxone Biosciences, Inc. (“BioAxone”), a VIE the Company had consolidated since 2014. As of December 31, 2020 and 2019, the Company did 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 Q, “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 U.S. 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 (i) determining the transaction price of revenues, (ii) accounting for acquisitions, including intangible assets, goodwill and contingent consideration and (iii) evaluating deferred tax asset valuation allowances and the provision for 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

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 Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers (“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 (“U.S.”), 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 U.S. subsequently resell the products to patients and health care providers. The Company recognizes net product revenues from 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 U.S. 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 recorded contract liabilities of $191.5 million and $62.3 million as of December 31, 2020 and 2019, respectively, related 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. These contracts include upfront payments and fees. The Company defers a portion of the consideration received for shipments made up to the annual reimbursement limit as a portion of “Other current liabilities.” 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 at the end of each fiscal year relate to contracts with annual reimbursement limits in international markets in which the annual period associated with the contract is not the same as the Company’s fiscal year. In these markets the Company recognizes revenues related to performance obligations satisfied in previous years; however, these revenues do not relate to any performance obligations that were satisfied more than 12 months prior to the beginning of the current year. During the years ended December 31, 2020, 2019 and 2018, the Company recorded $62.3 million, $24.9 million and $1.7 million, respectively, of revenues that were recorded as contract liabilities at the beginning of the year.

French Early Access Programs

In 2015, the Company began distributing ORKAMBI through early access programs in France and remained engaged in reimbursement discussions with the French government until November 2019, when the Company reached an agreement with the French government for ORKAMBI, including ORKAMBI distributed through early access programs. From the time the Company began distributing ORKAMBI through early access programs in France, it expected the difference between the amounts collected based on the invoiced amount and the final amount for ORKAMBI distributed through early access programs would be returned to the French government. As a result, the Company had classified a refund liability related to the early access programs in France within “Accrued expenses” on its consolidated balance sheets.

From the first quarter of 2018 through the third quarter of 2019, the Company recognized net product revenues for ORKAMBI sales in France under the early access programs based on a transaction price that reflected the Company’s estimate of consideration it expected to retain that would not be subject to a significant reversal in amounts recognized. When determining if variable consideration should be constrained, the Company considers whether there are factors outside its 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.

Upon reaching an agreement with the French government for ORKAMBI, including ORKAMBI distributed through early access programs in November 2019, the Company updated the transaction price to reflect the final amount for ORKAMBI distributed through early access programs. As a result, the Company recognized net product revenues of

$155.8 million related to prior period ORKAMBI early access program sales in the fourth quarter of 2019 because the updated transaction price for ORKAMBI distributed through these programs exceeded the Company’s previous estimate of the consideration it expected to retain that would not be subject to a significant reversal in amounts recognized. The Company paid the final amount due to the French government in 2020.

Collaborative and Royalty Revenues

The Company has not recorded significant collaborative and royalty revenues during the three years ended December 31, 2020; however, in future periods, it may recognize 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. This may result in revenues from certain milestones and a corresponding contract asset being recorded in a reporting period before the milestone is achieved. Milestone payments that have not been included in the transaction price to date are 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 believes that its allowances, which are not significant to its consolidated financial statements, are adequate at December 31, 2020. Please refer to Note Q, “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, 2020, the Company’s marketable securities consisted of investments in available-for-sale debt securities 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 loss,” which is a separate component of shareholders’ equity on its consolidated balance sheet, until such gains and losses are realized. Realized gains and losses, if any, are determined using the specific identification method.

The Company records changes in the fair value of its investments in corporate equity securities to “Other income (expense), net” in its consolidated statements of operations. Realized gains and losses, which are also included in “Other income (expense), net,” are determined on an original weighted-average cost basis.

The Company adopted Accounting Standards Update (“ASU”) 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”) as of January 1, 2020, which did not have a significant impact on its consolidated financial statements. For available-for-sale debt securities in unrealized loss positions, ASU 2016-13 requires the Company to record an allowance for credit losses using an expected loss model, which replaces the incurred loss model required under the previous guidance. A credit loss is limited to the amount by which the amortized cost of an investment exceeds its fair value. A previously recognized credit loss may be decreased in subsequent periods if the Company’s estimate of fair value for the investment increases. To determine whether to record a credit loss, the Company considers issuer specific credit ratings and historical losses as well as current economic conditions and its expectations for future economic conditions.

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 credit losses, which has not been significant to date, is determined based on existing contractual payment terms, historical payment patterns, current economic conditions and the Company’s expectation for future economic conditions.

Stock-based Compensation Expense

The Company expenses the fair value of employee restricted stock units 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.

The Company provides to employees who have rendered a certain number of years of service 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. Approximately 5% of the Company’s employees were eligible for partial or full acceleration of any of their equity awards as of December 31, 2020. 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; outsourced services and other direct expenses, including clinical trial and pharmaceutical development costs; collaborative payments; and infrastructure costs, including facilities costs and depreciation expense.

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, net of accumulated depreciation. Depreciation expense is recorded using the straight-line method over the estimated useful life of the related asset generally as follows:


Description						Estimated Useful Life
Buildings and improvements						15 to 40 years
Furniture and equipment						7 to 10 years
Leasehold improvements; assets under finance leases						The shorter of the useful life of the assets or the estimated remaining term of the associated lease
Computers and software						3 to 5 years

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.

Leases

The Company adopted ASU 2016-02, Leases (Topic 842) (“ASC 842”), as of January 1, 2019. Under ASC 842, the Company determines whether the arrangement contains a lease at the inception of an arrangement. If a lease is identified in an arrangement, the Company recognizes a right-of-use asset and liability on its consolidated balance sheet and determines whether the lease should be classified as a finance or operating lease. The Company does not recognize assets or liabilities for leases with lease terms of less than 12 months.

A lease qualifies as a finance lease if any of the following criteria are met at the inception of the lease: (i) there is a transfer of ownership of the leased asset to the Company by the end of the lease term, (ii) the Company holds an option to purchase the leased asset that it is reasonably certain to exercise, (iii) the lease term is for a major part of the remaining

economic life of the leased asset, (iv) the present value of the sum of lease payments equals or exceeds substantially all of the fair value of the leased asset, or (v) the nature of the leased asset is specialized to the point that it is expected to provide the lessor no alternative use at the end of the lease term. All other leases are recorded as operating leases.

Finance and operating lease assets and liabilities are recognized at the lease commencement date based on the present value of the lease payments over the lease term using the discount rate implicit in the lease. If the rate implicit is not readily determinable, the Company utilizes its incremental borrowing rate at the lease commencement date. Operating lease assets are further adjusted for prepaid or accrued lease payments. Operating lease payments are expensed using the straight-line method as an operating expense over the lease term. Finance lease assets are amortized to depreciation expense using the straight-line method over the shorter of the useful life of the related asset or the lease term. Finance lease payments are bifurcated into (i) a portion that is recorded as imputed interest expense and (ii) a portion that reduces the finance liability associated with the lease.

The Company does not separate lease and non-lease components when determining which lease payments to include in the calculation of its lease assets and liabilities. Variable lease payments are expensed as incurred. If a lease includes an option to extend or terminate the lease, the Company reflects the option in the lease term if it is reasonably certain it will exercise the option.

Finance leases are recorded in “Property and equipment, net,” “Other current liabilities” and “Long-term finance lease liabilities” and operating leases are recorded in “Operating lease assets,” “Other current liabilities” and “Long-term operating lease liabilities” on the Company’s consolidated balance sheet.

In 2018, prior to the adoption of ASC 842 on January 1, 2019, the Company applied build-to-suit accounting and was the deemed owner of its leased corporate headquarters in Boston and research site in San Diego, for which it was recognizing depreciation expense over the buildings’ useful lives and imputed interest on the corresponding construction financing lease obligations.

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.

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 and acquisitions 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 for a drug candidate; (ii) 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. 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. Please refer to Note D, “Fair Value Measurements,” for further information.

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 that is acquired in a transaction that does not qualify as a business combination under U.S. GAAP and that does not have an alternative future use is recorded to “Research and development expenses” in the period in which it is 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. As noted in Basis of Presentation above, the Company has one operating segment, pharmaceuticals, which is its only reporting unit.

Deconsolidation

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.

Discontinued Operations

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.

Embedded Derivatives

Embedded derivatives are required to be bifurcated from the host instruments and recorded at fair value if the derivatives are not clearly and closely related to the host instruments on the date of issuance. The Company did not have any material embedded derivatives that required bifurcation recorded on its consolidated balance sheets as of December 31, 2020 and 2019, respectively.

Hedging Activities

The Company recognizes the fair value of hedging instruments that are designated and qualify as hedging instruments pursuant to U.S. 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 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 current liabilities” or “Other long-term liabilities,” 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 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 U.S. GAAP. Realized gains and losses for such contracts are recognized in “Other income (expense), 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 expense (income)” on the Company’s consolidated statements of operations.

Comprehensive Income

Comprehensive income consists of net income 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 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. The assets and liabilities of the Company’s entities with functional currencies other than the U.S. dollar are translated into U.S. dollars at rates of exchange in effect at the end of the year. Revenue and expense amounts for these entities 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 loss.” Net foreign currency exchange transaction losses, which are included in “Other income (expense), net” on the Company’s consolidated statement of operations, were $16.1 million, $5.2 million and $1.1 million for 2020, 2019 and 2018, respectively. These net foreign currency exchange 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 Income Per Share Attributable to Vertex Common Shareholders

Basic and diluted net income per share attributable to Vertex common shareholders are presented in conformity with the two-class method required for participating securities. Shares of unvested restricted stock granted under the Company’s Amended and Restated 2006 Stock and Option Plan had 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 were considered participating securities under the two-class method. In 2020 and 2019, the Company did not have a significant amount of restricted stock outstanding under this plan: therefore, the two-class method did not impact its basic and diluted net income per share attributable to Vertex common shareholders for the years ended December 31, 2020 and 2019.

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. 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 income 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 had been issued but had not yet vested, if any. Diluted net income 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 Standards

Internal-Use Software

In 2018, the Financial Accounting Standards Board (“FASB”) issued ASU 2018-15, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract (“ASU 2018-15”), which clarifies the accounting for implementation costs in cloud computing arrangements. ASU 2018-15 became effective on January 1, 2020. The adoption of ASU 2018-15 resulted in an insignificant amount of additional assets recorded on the Company’s consolidated balance sheet.

Fair Value Measurement

In 2018, the FASB issued ASU 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 became effective on January 1, 2020. The Company adoption of ASU 2018-13 resulted in additional disclosures related to the Company’s Level 3 inputs. Please refer to Note D, “Fair Value Measurements,” for further information.

Credit Losses

In 2016, the FASB issued ASU 2016-13, which requires entities to record expected credit losses for certain financial instruments, including trade receivables, as an allowance that reflects the entity's current estimate of credit losses expected to be incurred. For available-for-sale debt securities in unrealized loss positions, ASU 2016-13 requires allowances to be

recorded instead of reducing the amortized cost of the investment. ASU 2016-13 became effective on January 1, 2020. The adoption of ASU 2016-13 did not have a significant impact on the Company’s consolidated financial statements.

Leases

On January 1, 2019, the Company adopted ASC 842 using the modified-retrospective method. Until December 31, 2018, the Company applied build-to-suit accounting and was the deemed owner of its leased corporate headquarters in Boston and research site in San Diego, for which it was recognizing depreciation expense over the buildings’ useful lives and imputed interest on the corresponding construction financing lease obligations. Under the amended guidance that became effective January 1, 2019, the Company accounts for these buildings as finance leases, resulting in increased depreciation expense over the respective lease terms of approximately 15 years, which are significantly shorter than the buildings’ useful lives of 40 years. The amended guidance also results in a reduction in imputed interest expense in the initial years of each finance lease term. As of January 1, 2019, the Company recorded a cumulative effect adjustment to increase its “Accumulated deficit” by $40.3 million related to the adjustments to its build-to-suit leases. Please refer to “Leases” above for further information.

Revenue Recognition

On January 1, 2018, the Company adopted ASC 606, using the modified retrospective adoption method for all contracts that were not completed as of the date of adoption. Based on the Company’s review of existing customer contracts as of January 1, 2018, the Company concluded that the only significant impact that the adoption of ASC 606 had on its consolidated financial statements related 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 expected to retain related to these shipments that would not be subject to a significant reversal in amounts recognized, net of costs previously deferred related to these shipments.

Equity Investments

On January 1, 2018, the Company adopted ASU 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities (“ASU 2016-01”), using the required modified-retrospective adoption method. 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. 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 loss” as of December 31, 2017.

Recently Issued Accounting Standards

Income Taxes

In 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740) (“ASU 2019-12”), which simplifies the accounting for income taxes. ASU 2019-12 was effective on January 1, 2021. The Company does not expect the adoption of ASU 2019-12 to have a significant impact on its consolidated financial statements.

Collaborative Arrangements	12 Months Ended
Collaborative Arrangements	Dec. 31, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Collaborative Arrangements	Collaborative Arrangements 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. 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 typically 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. The Company typically can terminate its in-license agreements by providing advance notice to its 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 had the exclusive right to license certain targets. In the fourth quarter of 2019, the Company paid an aggregate of $30.0 million to exclusively license three CRISPR-Cas9-based targets, including CF, pursuant to the CRISPR Agreement. The Company recorded the $30.0 million total option payment to “Research and development expenses” in the fourth quarter of 2019. For each of the three targets that the Company elected to license, CRISPR has the potential to receive up to an additional $410.0 million in development, regulatory and commercial milestones as well as royalties on net product sales. 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 hemoglobinopathies, including treatments for sickle cell disease and beta thalassemia. As part of the collaboration, the Company and CRISPR share equally all development costs and potential worldwide revenues related to potential hemoglobinopathy treatments. 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 years ended December 31, 2020, 2019 and 2018, the net expense related to the CTX001 Co-Co Agreement was $50.6 million, $30.1 million and $19.7 million, respectively. In July 2019, the Company entered into a separate strategic collaboration and license agreement (the “CRISPR DMD/DM1 Agreement”) with CRISPR. Pursuant to this agreement, the Company received an exclusive worldwide license to CRISPR’s existing and future intellectual property for Duchenne muscular dystrophy (“DMD”) and myotonic dystrophy type 1 (“DM1”) and the Company made an upfront payment of $175.0 million to CRISPR. The Company concluded that it did not have any alternative future use for the acquired in-process research and development and recorded the upfront payment to “Research and development expenses” in the third quarter of 2019. In 2020, the Company recorded $25.0 million to “Research and development expenses” related to a pre-clinical milestone earned by CRISPR under the CRISPR DMD/DM1 Agreement. CRISPR has the potential to receive up to an additional $800.0 million in research, development, regulatory and commercial milestones for the DMD and DM1 programs as well as royalties on net product sales. CRISPR has the option to co-develop and co-commercialize all DM1 products globally and forego the milestones and royalties associated with the DM1 program. The Company funds all expenses associated with the collaboration except for research costs for specified guide RNA research conducted by CRISPR, which the Company and CRISPR share equally. Kymera Therapeutics Inc. In May 2019, the Company entered into a strategic research and development collaboration agreement with Kymera Therapeutics Inc. (“Kymera”) to advance small molecule protein degraders against multiple targets. Kymera’s proprietary platform technology is being applied in the collaboration activities in exchange for an upfront payment of $50.0 million. The Company has the exclusive right to license up to six protein targets, for each of which Kymera may receive up to $170.0 million in payments, including development, regulatory and commercial milestones as well as royalties on net product sales. In addition to the upfront payment, the Company purchased $20.0 million of Kymera’s preferred stock. The Company determined that the fair value of its investment in Kymera’s preferred stock, which did not have a readily determinable fair value, approximated $20.0 million. The preferred stock converted to common stock when Kymera became a publicly traded company in 2020. The Company determined that substantially all of the fair value of the Kymera collaboration agreement was attributable to in-process research and development 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 and recorded the $50.0 million upfront payment to “Research and development expenses” in 2019. Moderna, Inc. In 2016, the Company entered into a strategic collaboration and licensing agreement with Moderna, Inc. (“Moderna”), pursuant to which the parties are seeking to identify and develop messenger ribonucleic acid (“mRNA”) therapeutics for the treatment of CF. In September 2020, the Company entered into a new strategic collaboration and licensing agreement with Moderna (the “2020 Moderna Agreement”) aimed at the discovery and development of lipid nanoparticles and mRNAs that can deliver gene-editing therapies to lung cells for the treatment of CF. Pursuant to the 2020 Moderna Agreement, Moderna received an upfront payment of $75.0 million and is eligible to receive up to $380.0 million in development, regulatory and commercial milestones as well as royalties on net product sales. The Company determined that substantially all of the fair value of the 2020 Moderna Agreement was attributable to in-process research and development 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 and recorded the upfront payment to “Research and development expenses” in the third quarter of 2020. Other In-License Agreements In addition to the collaborative arrangements described above, the Company has entered into additional in-license agreements that it does not consider to be individually significant to its consolidated financial statements. In addition to the payments described above, the Company recorded upfront, option and milestone payments totaling $84.6 million in 2020, $63.3 million in 2019 and $46.9 million in 2018 to “Research and development expenses” which included a $40.0 million upfront payment to Skyhawk Therapeutics, Inc. (“Skyhawk”) in 2020. For Skyhawk and several other in-license agreements that are not individually significant to the Company’s consolidated financial statements, the Company determined that substantially all of the fair value of each individual agreement was attributable to in-process research and development 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 associated with the agreements and recorded the related portion of the upfront payments to “Research and development expenses.” Please refer to Note D, “Fair Value Measurements,” and Note E, “Marketable Securities and Equity Investments,” for further information regarding the Company’s investments in its collaborators. Variable Interest Entities (VIEs) The Company licensed rights to certain drug candidates from these third-party collaborators, which has resulted in the consolidation of the third-parties’ financial statements into the Company’s consolidated financial statements as VIEs for certain periods of time. Most recently, the Company deconsolidated the financial statements of BioAxone from its consolidated financial statements as of December 31, 2018. The Company has not consolidated a VIE into its financial statements since December 31, 2018. 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. 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 of this decision, the Company recorded a $29.0 million impairment charge related to VX-210 that was attributable to noncontrolling interest. 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’s net loss attributable to noncontrolling interest for the year ended December 31, 2018 was $9.8 million. 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, which was recorded as “Collaborative and royalty revenues,” under the multiple element arrangement accounting guidance that was applicable in 2017. All of the Company’s activities related to 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 and recorded the $65.0 million payment to “Research and development expenses” in 2018 accordingly. Janssen Pharmaceuticals, Inc. In 2014, the Company entered into an agreement with Janssen Pharmaceuticals, Inc. (“Janssen”). In the third quarter of 2020, Janssen exercised its right to terminate its exclusive worldwide license to develop and commercialize certain drug candidates for the treatment of influenza, based on Phase 3 clinical trial results for pimodivir. Cystic Fibrosis Foundation The Company has a research, development and commercialization agreement that was originally entered into in 2004 with the Cystic Fibrosis Foundation, as successor in interest to the Cystic Fibrosis Foundation Therapeutics, Inc. This agreement was most recently amended in 2016. 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 elexacaftor, and tiered royalties ranging from single digits to sub-teens on covered compounds 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, SYMDEKO/SYMKEVI and TRIKAFTA/KAFTRIO (elexacaftor/tezacaftor/ivacaftor and ivacaftor), sales are allocated equally to each of the active pharmaceutical ingredients in the combination product.

Earnings Per Share

12 Months Ended

Dec. 31, 2020

Earnings Per Share [Abstract]

Earnings Per Share

Earnings Per ShareBasic net income per share attributable to Vertex common shareholders is based upon the weighted-average number of common shares outstanding during the period. Diluted net income per share attributable to Vertex common shareholders utilizing the treasury-stock method 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 per share for the periods ended:


	2020		2019		2018
	(in thousands, except per share amounts)
Basic net income attributable to Vertex per common share calculation:
Net income attributable to Vertex common shareholders	$	2,711,647	$	1,176,810	$	2,096,896
Less: Undistributed earnings allocated to participating securities	—		—		(501)
Net income attributable to Vertex common shareholders—basic	$	2,711,647	$	1,176,810	$	2,096,395

Basic weighted-average common shares outstanding	259,841		256,728		254,292
Basic net income attributable to Vertex per common share	$	10.44	$	4.58	$	8.24

Diluted net income attributable to Vertex per common share calculation:
Net income attributable to Vertex common shareholders	$	2,711,647	$	1,176,810	$	2,096,896
Less: Undistributed earnings allocated to participating securities	—		—		(492)
Net income attributable to Vertex common shareholders—diluted	$	2,711,647	$	1,176,810	$	2,096,404

Weighted-average shares used to compute basic net income per common share	259,841		256,728		254,292
Effect of potentially dilutive securities:
Stock options	1,801		2,231		2,913
Restricted stock units (including PSUs) and restricted stock	1,741		1,700		1,963
Employee stock purchase program	13		14		17
Weighted-average shares used to compute diluted net income per common share	263,396		260,673		259,185
Diluted net income attributable to Vertex per common share	$	10.29	$	4.51	$	8.09

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


	2020	2019	2018
	(in thousands)
Stock options	312	2,833	2,217
Unvested restricted stock units (including PSUs) and restricted stock	257	6	5

Fair Value Measurements

12 Months Ended

Dec. 31, 2020

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 determine the fair value of the Company’s financial 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. The Company maintains strategic investments separately from the investment policy that governs its other cash, cash equivalents and marketable securities as described in Note E, “Marketable Securities and Equity Investments.” 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.

During the three years ended December 31, 2020, the Company did not record any other-than-temporary impairment charges related to its financial assets.

The following tables set forth the Company’s financial assets and liabilities subject to fair value measurements by level within the fair value hierarchy (and does not include $2.8 billion and $2.3 billion of cash as of December 31, 2020 and 2019, respectively):


	As of December 31, 2020								As of December 31, 2019
			Fair Value Hierarchy								Fair Value Hierarchy
	Total		Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3
	(in thousands)
Financial instruments carried at fair value (asset position):
Cash equivalents:
Money market funds	$	3,141,053	$	3,141,053	$	—	$	—	$	791,039	$	791,039	$	—	$	—
Corporate debt securities	—		—		—		—		6,070		—		6,070		—
Commercial paper	—		—		—		—		29,472		—		29,472		—
Marketable securities:
Corporate equity securities	195,781		15,650		180,131		—		282,084		261,797		20,287		—
Government-sponsored enterprise securities	80,063		80,063		—		—		12,733		12,733		—		—
Corporate debt securities	231,598		—		231,598		—		301,799		—		301,799		—
Commercial paper	163,268		—		163,268		—		102,356		—		102,356		—
Prepaid expenses and other current assets:
Foreign currency forward contracts	—		—		—		—		9,725		—		9,725		—
Total financial assets	$	3,811,763	$	3,236,766	$	574,997	$	—	$	1,535,278	$	1,065,569	$	469,709	$	—

Financial instruments carried at fair value (liability position):
Other current liabilities:
Foreign currency forward contracts	$	(59,184)	$	—	$	(59,184)	$	—	$	(5,533)	$	—	$	(5,533)	$	—
Long-term contingent consideration	(189,600)		—		—		(189,600)		(176,500)		—		—		(176,500)
Other long-term liabilities:
Foreign currency forward contracts	(4,283)		—		(4,283)		—		(1,821)		—		(1,821)		—
Total financial liabilities	$	(253,067)	$	—	$	(63,467)	$	(189,600)	$	(183,854)	$	—	$	(7,354)	$	(176,500)

Please refer to Note E, “Marketable Securities and Equity Investments,” for the carrying amount and related unrealized gains (losses) by type of investment.

Fair Value of Corporate Equity Securities

The Company maintains strategic investments in corporate equity securities separately from the investment policy that governs its other cash, cash equivalents and marketable securities. The Company classifies its investments in publicly traded companies as “Marketable securities” on its consolidated balance sheets. Generally, the Company’s investments in the common stock of these publicly traded companies are valued based on Level 1 inputs because they have readily determinable fair values. However, certain of the Company’s investments in publicly traded companies have been or continue to be valued based on Level 2 inputs due to transfer restrictions associated with these investments. During the year ended December 31, 2020, the Company transferred the fair value of one of its strategic investments in a publicly traded company from Level 2 to

Level 1 upon the expiration of transfer restrictions associated with this investment. Please refer to Note E, “Marketable Securities and Equity Investments,” for further information on these investments.

Fair Value of Contingent Consideration

In 2019, the Company acquired Exonics Therapeutics, Inc. (“Exonics”), a privately-held company focused on creating transformative gene-editing therapies to repair mutations that cause DMD and other severe neuromuscular diseases, including DM1. The Company’s Level 3 contingent consideration liabilities are related to $678.3 million of development and regulatory milestones potentially payable to Exonics’ former equity holders. The Company bases its estimates of the probability of achieving the milestones relevant to the fair value of contingent payments on industry data attributable to rare diseases. The discount rates used in the valuation model for contingent payments, which were between 0.4% and 1.9% as of December 31, 2020, 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. Due to the uncertainties associated with development and commercialization of drug candidates in the pharmaceutical industry and the effects of changes in other assumptions including discount rates, the Company expects its estimates regarding the fair value of contingent consideration to change in the future, resulting in adjustments to the fair value of the Company’s contingent consideration liabilities, and the effect of any such adjustments could be material.

The following table represents a rollforward of the fair value of the Company’s contingent consideration liabilities:


	Year Ended December 31, 2020
	(in thousands)
Balance at December 31, 2019	$	176,500
Increase in fair value of contingent payments	13,100
Balance at December 31, 2020	$	189,600

The “Increase in fair value of contingent payments” in the table above was primarily due to changes in market interest rates.

- 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, 2020

Investments, Debt and Equity Securities [Abstract]

Marketable Securities and Equity Investments

A summary of the Company’s cash equivalents and marketable securities, which are recorded at fair value (and do not include $2.8 billion and $2.3 billion of cash as of December 31, 2020 and 2019, respectively), is shown below:


	As of December 31, 2020								As of December 31, 2019
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
	(in thousands)
Cash equivalents:
Money market funds	$	3,141,053	$	—	$	—	$	3,141,053	$	791,039	$	—	$	—	$	791,039
Corporate debt securities	—		—		—		—		6,070		—		—		6,070
Commercial paper	—		—		—		—		29,470		3		(1)		29,472
Total cash equivalents	$	3,141,053	$	—	$	—	$	3,141,053	$	826,579	$	3	$	(1)	$	826,581
Marketable securities:
Government-sponsored enterprise securities	$	80,046	$	17	$	—	$	80,063	$	12,689	$	44	$	—	$	12,733
Corporate debt securities	231,263		377		(42)		231,598		301,458		391		(50)		301,799
Commercial paper	163,286		19		(37)		163,268		102,240		121		(5)		102,356
Total marketable debt securities	474,595		413		(79)		474,929		416,387		556		(55)		416,888
Corporate equity securities	51,427		144,354		—		195,781		113,829		168,255		—		282,084
Total marketable securities	$	526,022	$	144,767	$	(79)	$	670,710	$	530,216	$	168,811	$	(55)	$	698,972

Available-for-sale debt securities were classified on the Company’s consolidated balance sheets as follows at fair value:


	December 31,
	2020		2019
	(in thousands)
Cash and cash equivalents	$	3,141,053	$	826,581
Marketable securities	474,929		416,888
Total	$	3,615,982	$	1,243,469

Available-for-sale debt securities by contractual maturity were as follows:


	December 31,
	2020		2019
	(in thousands)
Matures within one year	$	3,526,185	$	1,137,942
Matures after one year through five years	89,797		105,527
Total	$	3,615,982	$	1,243,469

The Company has a limited number of available-for-sale debt securities in insignificant loss positions as of December 31, 2020, 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 2020, 2019 or 2018.

The Company records changes in the fair value of its investments in corporate equity securities to “Other income (expense), net” in the Company’s consolidated statements of operations. During the three years ended December 31, 2020, the Company’s net unrealized gains on corporate equity securities held at the conclusion of each period were as follows:


	2020		2019		2018
	(in thousands)
Net unrealized gains	$	136,167	$	143,175	$	2,558

During the years ended December 31, 2020 and 2019, the Company sold the common stock of publicly traded companies, which were primarily sales of its investment in CRISPR, resulting in the following:


	2020		2019
	(in thousands)
Proceeds received	$	437,567	$	94,936
Weighted-average cost basis	$	103,332	$	29,825

During the year ended December 31, 2018, the Company did not sell any common stock of publicly traded companies.

As of December 31, 2020, 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 $20.8 million.

Accumulated Other Comprehensive Income (Loss)

12 Months Ended

Dec. 31, 2020

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 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
Other comprehensive income before reclassifications	10,332		1,039		—		11,513		22,884
Amounts reclassified from accumulated other comprehensive income (loss)	—		—		—		(25,516)		(25,516)
Net current period other comprehensive income (loss)	10,332		1,039		—		(14,003)		(2,632)
Balance as of December 31, 2019	$	(895)	$	503	$	—	$	(1,581)	$	(1,973)
Other comprehensive loss before reclassifications	(14,783)		(169)		—		(54,467)		(69,419)
Amounts reclassified from accumulated other comprehensive income (loss)	—		—		—		2,912		2,912
Net current period other comprehensive loss	(14,783)		(169)		—		(51,555)		(66,507)
Balance as of December 31, 2020	$	(15,678)	$	334	$	—	$	(53,136)	$	(68,480)

Hedging

12 Months Ended

Dec. 31, 2020

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, 2020, all hedges were determined to be highly effective.

Prior to the adoption of ASU 2017-12 on January 1, 2019, the Company did not record any ineffectiveness related to its foreign currency forward contracts that were designated as hedging instruments in the year ended December 31, 2018. ASU 2017-12 eliminated the requirement to separately measure and report hedge ineffectiveness.

The Company considers the impact of its counterparties’ credit risk on the fair value of the foreign currency forward contracts. As of December 31, 2020 and December 31, 2019, credit risk did not change the fair value of the Company’s foreign currency forward contracts.

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


	As of December 31,
	2020		2019
Foreign Currency	(in thousands)
Euro	$	745,099	$	501,197
British pound sterling	160,427		87,032
Australian dollar	99,922		89,705
Canadian dollar	86,468		50,452
Total foreign currency forward contracts	$	1,091,916	$	728,386

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 that are 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 U.S. GAAP. The Company recognizes realized gains and losses for such contracts in “Other income (expense), net” in its consolidated statements of operations each period. As of December 31, 2020, the notional amount of the Company’s outstanding foreign currency forward contracts where hedge accounting under U.S. GAAP is not applied was $198.9 million.

During the three years ended December 31, 2020, the Company recognized the following related to foreign currency forward contacts in its consolidated statements of operations:


	December 31,
	2020		2019		2018
	(in thousands)
Designated as hedging instruments - Reclassified from AOCI
Product revenues, net	$	(3,714)	$	32,546	$	(1,252)
Not designated as hedging instruments
Other income (expense), net	$	22,113	$	(4,838)	$	(623)

Total reported in the Consolidated Statement of Operations
Product revenues, net	$	6,202,783	$	4,160,726	$	3,038,325
Other income (expense), net	$	296,420	$	192,177	$	(790)

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


As of December 31, 2020
Assets			Liabilities
Classification	Fair Value		Classification	Fair Value
(in thousands)
Prepaid expenses and other current assets	$	—	Other current liabilities	$	(59,184)
Other assets	—		Other long-term liabilities	(4,283)
Total assets	$	—	Total liabilities	$	(63,467)


As of December 31, 2019
Assets			Liabilities
Classification	Fair Value		Classification	Fair Value
(in thousands)
Prepaid expenses and other current assets	$	9,725	Other current liabilities	$	(5,533)
Other assets	—		Other long-term liabilities	(1,821)
Total assets	$	9,725	Total liabilities	$	(7,354)

As of December 31, 2020, the Company expects amounts that are related to foreign exchange forward contracts designated as cash flow hedges under U.S. GAAP recorded in “Prepaid expenses and other current assets” and “Other current liabilities” 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 U.S. GAAP on the Company’s consolidated balance sheets:


	As of December 31, 2020
	Gross Amounts Recognized		Gross Amounts Offset		Gross Amounts Presented		Gross Amounts Not Offset		Legal Offset
Foreign currency forward contracts	(in thousands)
Total assets	$	—	$	—	$	—	$	—	$	—
Total liabilities	(63,467)		—		(63,467)		—		(63,467)


	As of December 31, 2019
	Gross Amounts Recognized		Gross Amounts Offset		Gross Amounts Presented		Gross Amounts Not Offset		Legal Offset
Foreign currency forward contracts	(in thousands)
Total assets	$	9,725	$	—	$	9,725	$	(7,354)	$	2,371
Total liabilities	(7,354)		—		(7,354)		7,354		—

Inventories

12 Months Ended

Dec. 31, 2020

Inventory Disclosure [Abstract]

Inventories

Inventories consisted of the following:


	As of December 31,
	2020		2019
	(in thousands)
Raw materials	$	46,232	$	26,247
Work-in-process	161,324		107,021
Finished goods	73,221		34,234
Total	$	280,777	$	167,502

Property and Equipment

12 Months Ended

Dec. 31, 2020

Property, Plant and Equipment [Abstract]

Property and Equipment

Property and equipment, net consisted of the following:


	As of December 31,
	2020		2019
	(in thousands)
Buildings and improvements	$	876,091	$	713,412
Furniture and equipment	346,698		317,567
Leasehold improvements	234,585		175,769
Computers and software	258,612		230,872
Land	33,128		—
Total property and equipment, gross	1,749,114		1,437,620
Less: accumulated depreciation	(790,580)		(692,540)
Total property and equipment, net	$	958,534	$	745,080

The Company recorded depreciation expense of $109.5 million, $106.9 million and $72.4 million in 2020, 2019 and 2018, respectively. The Company’s finance lease amortization is included in depreciation expense.

In the third quarter of 2020, the Company purchased its continuous manufacturing facility located near its corporate headquarters in Boston, Massachusetts from its former landlord for $155.3 million in cash. The Company’s December 31, 2020 consolidated balance sheet reflects the following: (i) classification of the building within “Property and equipment, net” with a 40 year useful life, (ii) derecognition of the previously recorded insignificant right-of-use asset and operating lease liability for the facility and (iii) a finance lease for the land on which the facility is constructed.

Intangible Assets and Goodwill	12 Months Ended
Intangible Assets and Goodwill	Dec. 31, 2020
Goodwill and Intangible Assets Disclosure [Abstract]
Intangible Assets and Goodwill	Intangible Assets and Goodwill Intangible Assets As of December 31, 2020 and 2019, the Company had $400.0 million of in-process research and development intangible assets classified as “Intangible assets” on its consolidated balance sheet. In 2019, the Company recorded $387.0 million and $13.0 million of in-process research and development intangible assets related to its acquisitions of Semma Therapeutics, Inc. (“Semma”) and Exonics, respectively. In 2018, the Company recorded an intangible asset impairment charge of $29.0 million related to VX-210 that was licensed from BioAxone in 2014. Please refer to Note B, “Collaborative Arrangements,” for further information regarding the events and circumstances associated with this impairment charge. Goodwill As of December 31, 2020 and December 31, 2019, goodwill of $1.00 billion was recorded on the Company’s consolidated balance sheet. During 2019, the Company recorded goodwill of $554.6 million and $397.1 million related to its acquisitions of Semma and Exonics, respectively.

Additional Balance Sheet Detail

12 Months Ended

Dec. 31, 2020

Payables and Accruals [Abstract]

Additional Balance Sheet Detail

Accrued expenses consisted of the following:


	As of December 31,
	2020		2019
	(in thousands)
Product revenue accruals	$	781,903	$	641,368
Payroll and benefits	169,387		159,464
Research, development and commercial contract costs	136,704		105,663
Royalty payable	165,404		98,578
Tax related accruals	104,173		72,293
Other	47,400		39,546
Total	$	1,404,971	$	1,116,912

Other current liabilities consisted of the following:


	As of December 31,
	2020		2019
	(in thousands)
Contract liabilities	$	191,519	$	62,332
Fair value of cash flow hedges	59,184		5,533
Finance lease liabilities	42,434		38,794
Other	24,286		23,646
Total	$	317,423	$	130,305

The cash, cash equivalents and restricted cash balances at the beginning and ending of each period presented in the Company’s consolidated statements of cash flows consisted of the following:


	As of December 31,
	2020		2019		2018		2017
	(in thousands)
Cash and cash equivalents	$	5,988,187	$	3,109,322	$	2,650,134	$	1,665,412
Prepaid expenses and other current assets	658		8,004		4,910		2,114
Other assets	—		3,355		3,209		—
Cash, cash equivalents and restricted cash per consolidated statement of cash flows	$	5,988,845	$	3,120,681	$	2,658,253	$	1,667,526

The Company’s restricted cash, if any, is included in “Prepaid expenses and other current assets” and “Other assets” on its consolidated balance sheets.

Leases

12 Months Ended

Dec. 31, 2020

Leases [Abstract]

Leases

Finance Leases

The Company’s finance lease assets and liabilities primarily relate to its corporate headquarters in Boston and research site in San Diego (the “Buildings”). These Buildings are classified as finance leases because the present value of the sum of the lease payments associated with the Buildings exceeds substantially all of the fair value of the Buildings. The Company also has outstanding finance leases for equipment and land.

Pursuant to ASC 842, which was adopted on January 1, 2019, the Company’s finance lease assets are amortized to depreciation expense using the straight-line method over the remaining lease term; and the Company records imputed interest expense associated with its finance lease liabilities. In 2018, prior to the adoption of ASC 842, the Company applied build-to-

suit accounting and was deemed for accounting purposes to be the owner of the Buildings, for which it recognized depreciation expense over the Buildings 40 years useful lives and imputed interest expense on the corresponding financing lease obligations.

Corporate Headquarters

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 in Boston, Massachusetts for a term of 15 years. Base rent payments commenced in December 2013, and will continue through December 2028. The Company utilizes this initial period as its lease term. The Company has an option to extend the lease term for an additional ten years.

San Diego Lease

In 2015, the Company entered into a lease agreement pursuant to which the Company leases approximately 170,000 square feet of office and laboratory space in San Diego, California for a term of 16 years. Base rent payments commenced in the second quarter of 2019, and will continue through May 2034. The Company utilizes this initial period as its lease term. The Company has an option to extend the lease term for up to two additional five-year terms. The Company placed this building into service in the second quarter of 2018.

Operating Leases

The Company’s operating leases relate to its real estate leases that are not classified as finance leases.

Cell and Genetic Therapies Lease

In 2019, the Company entered into an agreement to lease approximately 269,000 square feet of office and laboratory space near its corporate headquarters in Boston, Massachusetts. The lease agreement includes an initial term of 15 years plus a period to install leasehold improvements, with an option to extend the lease term for up to two additional ten-year periods. Base rent payments will commence in the fourth quarter of 2021. The Company has utilized the initial period, which commenced in the third quarter of 2020 upon occupation of the building, as its lease term. As of December 31, 2020, the Company recorded a right-of-use asset of $253.5 million and an operating lease liability of $286.6 million related to the lease agreement on its consolidated balance sheet.

Please refer to the Company’s accounting policy, Leases, in Note A, “Nature of Business and Accounting Policies,” for further information on the accounting treatment for the Company’s finance and operating leases.

Aggregate Lease Information Related to the Application of ASC 842

The following information is disclosed in accordance with ASC 842, which became effective January 1, 2019. The components of lease cost recorded in the Company’s consolidated statement of operations were as follows:


	2020		2019

Operating lease cost	$	23,128	$	11,972
Finance lease cost
Amortization of leased assets	51,223		49,778
Interest on lease liabilities	50,188		52,839
Variable lease cost	30,776		27,997
Sublease income	(4,021)		(6,391)
Net lease cost	$	151,294	$	136,195

The Company’s variable lease cost during 2020 and 2019 primarily related to operating expenses, taxes and insurance associated with its finance leases. The Company’s sublease income during 2020 and 2019 primarily related to subleases for an insignificant portion of the Company’s corporate headquarters.

The Company’s leases are included on its consolidated balance sheets as follows:


	As of December 31,
	2020		2019
	(in thousands)
Finance leases
Property and equipment, net	$	431,193	$	445,336
Total finance lease assets	$	431,193	$	445,336

Other current liabilities	$	42,434	$	38,795
Long-term finance lease liabilities	539,042		538,576
Total finance lease liabilities	$	581,476	$	577,371

Operating leases
Operating lease assets	$	325,564	$	88,202
Total operating lease assets	$	325,564	$	88,202

Other current liabilities	$	10,521	$	11,504
Long-term operating lease liabilities	350,463		84,292
Total operating lease liabilities	$	360,984	$	95,796

Maturities of the Company’s finance and operating lease liabilities as of December 31, 2020 were as follows:


Year	Finance Leases		Operating Leases		Total
	(in thousands)
2021	$	85,470	$	15,266	$	100,736
2022	90,020		34,119		124,139
2023	88,185		34,663		122,848
2024	93,434		34,113		127,547
2025	93,421		31,564		124,985
Thereafter	416,455		320,684		737,139
Total lease payments	866,985		470,409		1,337,394
Less: tenant allowance	—		(36,051)		(36,051)
Less: amount representing interest	(285,509)		(73,374)		(358,883)
Present value of lease liabilities	$	581,476	$	360,984	$	942,460

The weighted-average remaining lease terms and discount rates related to the Company’s leases were as follows:


	As of December 31,
	2020		2019
Weighted-average remaining lease term (in years)
Finance leases	11.58		9.74
Operating leases	14.10		9.70

Weighted-average discount rate
Finance leases	8.36	%	9.04	%
Operating leases	2.28	%	3.75	%

Supplemental cash flow information related to the Company’s leases was as follows:


	2020		2019
	(in thousands)
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases	$	16,254	$	10,650
Operating cash flows from finance leases	$	48,908	$	50,527
Financing cash flows from finance leases	$	42,275	$	39,185

Right-of-use assets obtained in exchange for lease obligations
Operating leases *	$	293,604	$	34,605
Finance leases	$	33,128	$	—
* 2019 includes $33.7 million acquired in 2019 pursuant to the Company’s acquisitions of Semma and Exonics.

Additional Lease Information Related to the Application of ASC 840

Rental expense was $17.3 million during the year ended December 31, 2018, which is disclosed in accordance with ASC 840, Leases (Topic 840), which was applicable during the year ended December 31, 2018.

Leases

Finance Leases

Corporate Headquarters

San Diego Lease

Operating Leases

The Company’s operating leases relate to its real estate leases that are not classified as finance leases.

Cell and Genetic Therapies Lease

Aggregate Lease Information Related to the Application of ASC 842


	2020		2019

Operating lease cost	$	23,128	$	11,972
Finance lease cost
Amortization of leased assets	51,223		49,778
Interest on lease liabilities	50,188		52,839
Variable lease cost	30,776		27,997
Sublease income	(4,021)		(6,391)
Net lease cost	$	151,294	$	136,195

The Company’s leases are included on its consolidated balance sheets as follows:


	As of December 31,
	2020		2019
	(in thousands)
Finance leases
Property and equipment, net	$	431,193	$	445,336
Total finance lease assets	$	431,193	$	445,336

Other current liabilities	$	42,434	$	38,795
Long-term finance lease liabilities	539,042		538,576
Total finance lease liabilities	$	581,476	$	577,371

Operating leases
Operating lease assets	$	325,564	$	88,202
Total operating lease assets	$	325,564	$	88,202

Other current liabilities	$	10,521	$	11,504
Long-term operating lease liabilities	350,463		84,292
Total operating lease liabilities	$	360,984	$	95,796

Maturities of the Company’s finance and operating lease liabilities as of December 31, 2020 were as follows:


Year	Finance Leases		Operating Leases		Total
	(in thousands)
2021	$	85,470	$	15,266	$	100,736
2022	90,020		34,119		124,139
2023	88,185		34,663		122,848
2024	93,434		34,113		127,547
2025	93,421		31,564		124,985
Thereafter	416,455		320,684		737,139
Total lease payments	866,985		470,409		1,337,394
Less: tenant allowance	—		(36,051)		(36,051)
Less: amount representing interest	(285,509)		(73,374)		(358,883)
Present value of lease liabilities	$	581,476	$	360,984	$	942,460

The weighted-average remaining lease terms and discount rates related to the Company’s leases were as follows:


	As of December 31,
	2020		2019
Weighted-average remaining lease term (in years)
Finance leases	11.58		9.74
Operating leases	14.10		9.70

Weighted-average discount rate
Finance leases	8.36	%	9.04	%
Operating leases	2.28	%	3.75	%

Supplemental cash flow information related to the Company’s leases was as follows:


	2020		2019
	(in thousands)
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases	$	16,254	$	10,650
Operating cash flows from finance leases	$	48,908	$	50,527
Financing cash flows from finance leases	$	42,275	$	39,185

Right-of-use assets obtained in exchange for lease obligations
Operating leases *	$	293,604	$	34,605
Finance leases	$	33,128	$	—
* 2019 includes $33.7 million acquired in 2019 pursuant to the Company’s acquisitions of Semma and Exonics.

Additional Lease Information Related to the Application of ASC 840

Common Stock, Preferred Stock and Equity Plans

12 Months Ended

Dec. 31, 2020

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, 2020 and 2019, the Company had no shares of preferred stock issued or outstanding.

Share Repurchase Programs

During 2018, the Company’s Board of Directors approved a share repurchase program (the “2018 Share Repurchase Program”), pursuant to which the Company was authorized to repurchase up to $500.0 million of its common stock between February 1, 2018 and December 31, 2019. During the years ended December 31, 2019 and 2018, the Company repurchased 832,186 and 2,093,891 shares, respectively, of its common stock under the 2018 Share Repurchase Program for an aggregate of $150.0 million and $350.0 million, respectively, including commissions and fees. As of June 30, 2019, the Company had repurchased the entire $500.0 million it was authorized to repurchase of its common stock under the 2018 Share Repurchase Program.

In July 2019, the Company’s Board of Directors approved a second share repurchase program (the “2019 Share Repurchase Program”), pursuant to which the Company was authorized to repurchase up to $500.0 million of its common stock between August 1, 2019 and December 31, 2020. During the years ended December 31, 2020 and 2019, the Company repurchased 2,058,962 and 213,548 shares, respectively, of its common stock under the 2019 Share Repurchase Program for an aggregate of $464.0 million and $36.0 million, respectively, including commissions and fees. As of December 31, 2020, the Company had repurchased the entire $500.0 million it was authorized to repurchase of its common stock under the 2019 Share Repurchase Program.

In November 2020, the Company’s Board of Directors approved a third share repurchase program (the “2020 Share Repurchase Program”), pursuant to which the Company is authorized to repurchase up to $500.0 million of its common stock

by December 31, 2022. In the fourth quarter of 2020, the Company repurchased 345,897 shares of its common stock under the 2020 Share Repurchase Program for an aggregate of $75.1 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. As of December 31, 2020, there was a total of $424.9 million remaining for repurchases of its common stock under the 2020 Share Repurchase Program.

Under the 2020 Share Repurchase Program, the Company is authorized to purchase shares from time to time through open market or privately negotiated transactions. Such purchases are 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.

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 nonstatutory stock options (“NSOs”), incentive stock options (“ISOs”), restricted stock units (“RSUs”) including performance-based RSUs (“PSUs”), restricted stock (“RSs”), 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, 2020

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

7,231,859

13,385,321

2006 Stock and Option Plan

Employees, Non-employee Directors and Consultants

NSO,
RS and RSU

383,818

—

Total

7,615,677

13,385,321

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, 2020, 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 2019 and 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) 5,000,000 shares in 2019 and (ii) 8,000,000 shares in 2018.

During the three years ended December 31, 2020, 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, 2020, 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, 2020:


	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, 2019	6,272	$	134.92
Granted	23	$	286.27
Exercised	(1,883)	$	121.42
Forfeited	(174)	$	165.39
Expired	—	$	—
Outstanding at December 31, 2020	4,238	$	140.47	6.34	$	397,211
Exercisable at December 31, 2020	2,894	$	125.83	5.73	$	313,936

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 2020, which was $233.91 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 2020, 2019 and 2018 was $255.0 million, $325.9 million and $258.2 million, respectively. The total cash received by the Company as a result of employee stock option exercises during 2020, 2019 and 2018 was $228.2 million, $317.8 million and $263.4 million, respectively.

The following table summarizes information about stock options outstanding and exercisable at December 31, 2020:


	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)
$36.28–$40.00	60	0.85	$	38.06	60	$	38.06
$40.01–$60.00	154	1.73	$	47.07	154	$	47.07
$60.01–$80.00	97	3.25	$	74.53	97	$	74.54
$80.01–$100.00	991	5.34	$	88.93	937	$	89.07
$100.01–$120.00	127	4.07	$	109.24	127	$	109.22
$120.01–$140.00	271	4.71	$	129.49	270	$	129.50
$140.01–$160.00	715	7.05	$	155.49	415	$	155.42
$160.01–$180.00	578	7.47	$	168.40	312	$	166.01
$180.01–$200.00	1,222	7.85	$	185.31	499	$	184.92
$200.01–$286.27	23	9.42	$	286.27	23	$	286.27
Total	4,238	6.34	$	140.47	2,894	$	125.83

Restricted Stock Units (excluding PSUs) and Restricted Stock

The following table summarizes the restricted stock unit and restricted stock activity of the Company during the year ended December 31, 2020:


	Restricted Stock Units (excluding PSUs)			Restricted Stock
	Number of Shares	Weighted-average Grant-date Fair Value		Number of Units	Weighted-average Grant-date Fair Value
	(in thousands)	(per share)		(in thousands)	(per share)
Unvested at December 31, 2019	3,131	$	163.61	92	$	91.97
Granted	1,244	$	258.45	—	$	—
Vested	(1,443)	$	159.10	(92)	$	91.97
Cancelled	(210)	$	193.84	—	$	—
Unvested at December 31, 2020	2,722	$	206.99	—	$	—

The total fair value of restricted stock units that vested during 2020, 2019 and 2018 (measured on the date of vesting) was $370.3 million, $178.2 million and $104.8 million, respectively. The total fair value of restricted stock that vested during 2020, 2019 and 2018 (measured on the date of vesting) was $21.4 million, $70.7 million and $114.5 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, 2020:


	Performance-Based RSU
	Number of Units	Weighted-average Grant-date Fair Value
	(in thousands)	(per share)
Unvested at December 31, 2019 (1)	734	$	143.21
Granted (2)	547	$	241.38
Vested	(577)	$	114.11
Cancelled	(48)	$	194.46
Unvested at December 31, 2020	656	$	202.06

(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 2020 and (ii) any change in the number of shares issuable pursuant to outstanding PSUs based on performance certification during 2020.

The total fair value of PSUs that vested during 2020, 2019 and 2018 (measured on the date of vesting) was $138.5 million, $73.3 million and $23.2 million, respectively.

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, 2020, there were 1,996,321 shares of common stock authorized for issuance pursuant to the ESPP.

In 2020, the following shares were issued to employees under the ESPP:


	Year Ended December 31, 2020
	(in thousands, except per share amount)
Number of shares	203,055
Average price paid per share	$	167.93

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, 2020, 2019 and 2018, the Company contributed approximately $19.2 million, $15.8 million and $13.9 million to the plan, respectively.

Stock-based Compensation Expense

12 Months Ended

Dec. 31, 2020

Share-based Payment Arrangement [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 units, including PSUs, and restricted stock 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.

The effect of stock-based compensation expense during the three years ended December 31, 2020 was as follows:


	2020		2019		2018
	(in thousands)
Stock-based compensation expense by line item:
Cost of sales	$	5,579	$	5,575	$	4,543
Research and development expenses	262,690		224,558		203,112
Sales, general and administrative expenses	161,192		130,356		117,392
Total stock-based compensation expense included in costs and expenses	429,461		360,489		325,047
Income tax effect	(146,959)		(124,225)		—
Total stock-based compensation included in costs and expenses, net of tax	$	282,502	$	236,264	$	325,047

The Company maintained a valuation allowance on the majority of its NOLs and other deferred tax assets until December 31, 2018. Therefore, there was no “Income tax effect” of stock-based compensation expense for the year ended December 31, 2018.

The stock-based compensation expense by type of award during the three years ended December 31, 2020 was as follows:


	2020		2019		2018
	(in thousands)
Stock-based compensation expense by type of award:
Restricted stock units (including PSUs) and restricted stock	$	360,364	$	254,276	$	207,845
Stock options	59,722		96,737		107,854
ESPP share issuances	12,984		11,196		9,933
Stock-based compensation expense related to inventories	(3,609)		(1,720)		(585)
Total stock-based compensation expense included in costs and expenses	$	429,461	$	360,489	$	325,047

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, 2020, by type of award and the weighted-average period over which that expense is expected to be recognized:


	As of December 31, 2020
	Unrecognized Expense		Weighted-average Recognition Period
	(in thousands)		(in years)
Type of award:
Restricted stock units (including PSUs) and restricted stock	$	401,100	1.88
Stock options	$	62,392	1.77
ESPP share issuances	$	11,333	0.59

Stock Options

In each of the three years ended December 31, 2020, the Company issued stock options to its non-employee directors. In 2019 and 2018, the Company issued stock options with service conditions, which were generally the vesting periods of the awards, to its employees. 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 2020, 2019 and 2018 had a weighted-average grant-date fair value per share of $88.37, $61.32 and $60.83, respectively.

The fair value of each option granted during 2020, 2019 and 2018 was estimated on the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions:


	2020	2019	2018
Stock options granted	22,636	1,520,743	2,297,328

Expected stock price volatility	35.87%	36.99%	40.50%
Risk-free interest rate	0.43%	2.32%	2.61%
Expected term of options (in years)	4.67	4.27	4.55
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 Units and Performance-based Restricted Stock Units

The Company awards restricted stock units with service conditions, which are generally the vesting periods of the awards. As of December 31, 2020, the Company did not have any unvested restricted stock awards remaining, which it awarded until 2016.

The Company grants 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 is 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 2020, 2019 and 2018 was $65.88, $47.79 and $44.04, respectively. The following table reflects the weighted-average assumptions used in the Black-Scholes option pricing model for 2020, 2019 and 2018:


	2020	2019	2018
Expected stock price volatility	37.70%	33.43%	36.51%
Risk-free interest rate	0.11%	2.08%	2.36%
Expected term (in years)	0.71	0.74	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, 2020

Income Tax Disclosure [Abstract]

Income Taxes

The components of income before provision for (benefit from) income taxes during the three years ended December 31, 2020 consisted of the following:


	2020		2019		2018
	(in thousands)
United States	$	2,885,423	$	1,263,379	$	812,086
Foreign	231,375		131,540		(211,845)
Income before provision for (benefit from) income taxes	$	3,116,798	$	1,394,919	$	600,241

The components of the provision for (benefit from) income taxes during the three years ended December 31, 2020 consisted of the following:


	2020		2019		2018
	(in thousands)
Current taxes:
Federal	$	71,377	$	—	$	772
Foreign	37,582		37,194		15,600
State	18,851		13,528		9,018
Total current taxes	127,810		50,722		25,390
Deferred taxes:
Federal	510,220		184,312		(1,105,053)
Foreign	(239,579)		(24,797)		(364,919)
State	6,700		7,872		(42,280)
Total deferred taxes	277,341		167,387		(1,512,252)
Provision for (benefit from) income taxes	$	405,151	$	218,109	$	(1,486,862)

A reconciliation of the provision for (benefit from) income taxes as computed by applying the U.S. federal statutory rate of 21% for the three years ended December 31, 2020 to the provision for (benefit from) income taxes is as follows:


	2020		2019		2018
	(in thousands)
Income before provision for (benefit from) income taxes	$	3,116,798	$	1,394,919	$	600,241

Expected provision for income taxes	654,528		292,933		126,051
State taxes, net of federal benefit	18,596		8,478		8,680
Foreign income tax rate differential	5,433		6,178		23,427
Tax credits	(55,824)		(59,459)		(52,629)
Benefit from income taxes attributable to valuation allowances	17,384		(2,672)		(1,563,169)
Tax rate change	(37,688)		—		—
Stock compensation (benefit), shortfalls and cancellations	(70,628)		(56,324)		(49,044)
Officer’s compensation	13,079		10,666		8,310
Long-term intercompany receivable write-off	(53,821)		—		—
Deconsolidation of VIE	—		—		(9,390)
Uncertain tax positions	39,808		14,070		15,431
Inter-entity transfer of intellectual property rights	(209,000)		—		—
U.S. deemed dividend	71,727		79		64
Other	11,557		4,160		5,407
Provision for (benefit from) income taxes	$	405,151	$	218,109	$	(1,486,862)

The Company is subject to U.S. federal, state, and foreign income taxes. The Company’s provision for income taxes during the years ended December 31, 2020 and 2019, has increased compared to historical amounts due to the release of the Company’s valuation allowance on the majority of its net operating losses (“NOLs”) and other deferred tax assets as of December 31, 2018. Starting in 2019, the Company began recording a provision for income taxes approximating the statutory rates on its pre-tax income. The Company’s effective tax rate of 13% for 2020 was lower than the U.S. statutory rate primarily due to (i) discrete tax benefits associated with an intra-entity transfer of intellectual property rights to the United Kingdom (“U.K.”), the write-off of a long-term intercompany receivable, and an increase in the U.K.’s corporate tax rate; and (ii) excess tax benefits related to stock-based compensation. The impact of these items was partially offset by a U.S. deemed dividend. The Company’s effective tax rate of 16% for 2019 was lower than the U.S. statutory rate primarily due to excess tax benefits related to stock-based compensation and research and development tax credits. The Company utilized substantially all of its remaining previously benefited U.S. NOLs in 2020. As a result, a larger portion of the Company’s tax provision will represent a cash tax payable in future periods.

In the second quarter of 2020, the Company completed an intra-entity transfer of intellectual property rights to the U.K., resulting in a deferred tax benefit of $209.0 million. The Company expects to be able to utilize the deferred tax asset resulting from the intra-entity transfer.

In 2018, the change in the “Benefit from income taxes attributable to valuation allowances” 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 U.S. and the U.K. The Company released these valuation allowances after determining it was more likely than not that its deferred tax assets would be realized in the future based on 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.

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,
	2020		2019
	(in thousands)
Deferred tax assets:
Net operating loss	$	140,563	$	512,256
Tax credit carryforwards	406,120		549,543
Intangible assets	507,484		275,290
Deferred revenues	20,962		18,833
Stock-based compensation	89,203		85,199
Accrued expenses	47,326		44,367
Finance lease liabilities	118,749		119,160
Operating lease assets	65,046		13,114
Other	987		8,596
Gross deferred tax assets	1,396,440		1,626,358
Valuation allowance	(213,750)		(205,192)
Total deferred tax assets	1,182,690		1,421,166
Deferred tax liabilities:
Property and equipment	(116,955)		(101,235)
Acquired intangibles	(87,025)		(87,160)
Unrealized gain	(17,553)		(28,838)
Operating lease liabilities	(63,310)		(13,118)
Other	(15,068)		—
Net deferred tax assets	$	882,779	$	1,190,815

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. As of December 31, 2020, the Company maintained a valuation allowance of $213.8 million related primarily to U.S. state and foreign tax attributes.

As of December 31, 2020, the Company had NOL carryforwards of $97.4 million, which are subject to annual utilization limitations, and tax credits of $249.2 million for U.S. federal income tax purposes. As of December 31, 2020, the Company had NOL carryforwards of $708.2 million and tax credits of $179.1 million for U.S. state income tax purposes. The U.S. federal NOLs may be carried forward indefinitely, with the exception of $29.1 million that will begin to expire in 2030. The state NOL carryforwards and tax credits expire at various dates through 2040 and may be used to offset future state income tax liabilities. As of December 31, 2020, the Company had foreign net operating loss carryforwards of $521.6 million, including $10.6 million that were subject to expiration at various dates through 2040 and $511.0 million that had an indefinite carryforward period.

Unrecognized tax benefits during the three years ended December 31, 2020 were as follows:


	2020		2019		2018
	(in thousands)
Balance at beginning of the period	$	33,920	$	19,549	$	3,814
Increases related to current period tax positions	26,653		14,407		9,704
Increases related to prior period tax positions	26,732		598		6,031
Decreases related to prior period tax positions	—		(156)		—
Settlement with tax authorities	—		(478)		—
Statute of limitations expiration	(657)		—		—
Balance at end of period	$	86,648	$	33,920	$	19,549

As of December 31, 2020, the Company has classified $48.1 million and $38.5 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 consolidated financial statements. As of December 31, 2020, 2019 and 2018, the Company had $75.8 million, $33.9 million and $19.5 million, respectively, of net unrecognized tax benefits, which would affect the Company’s tax rate if recognized. The Company does not expect that its unrecognized tax benefits will materially change within the next twelve months. The Company accrues interest and penalties related to unrecognized tax benefits as a component of its “Provision for (benefit from) income taxes.” The Company did not recognize any material interest or penalties related to uncertain tax positions during the three years ended December 31, 2020.

In March 2020, the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) was signed into law. The CARES Act includes provisions relating to several aspects of corporate income taxes. The CARES Act did not have a significant impact on the Company’s provision for income taxes.

As of December 31, 2020, 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 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 U.S. 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 has various income tax audits ongoing at any time throughout the world.

- Definition

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

+ References + Details

Commitments and Contingencies	12 Months Ended
Commitments and Contingencies	Dec. 31, 2020
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies Revolving Credit Facilities The Company and certain of its subsidiaries have entered into two credit agreements (the “Credit Agreements”) with Bank of America, N.A., as administrative agent and the lenders referred to therein (the “Lenders”). The Credit Agreements were not drawn upon at closing and the Company has not drawn upon them to date. Amounts drawn pursuant to the Credit Agreements, if any, will be used for general corporate purposes. Any amounts borrowed under the Credit Agreements will bear interest, at the Company’s option, at either a base rate or a Eurocurrency rate, in each case plus an applicable margin based on the Company’s consolidated leverage ratio (the ratio of the Company’s total consolidated funded indebtedness to the Company’s consolidated EBITDA for the most recently completed four fiscal quarter period). In September 2019, the Company and certain of its subsidiaries entered into a $500.0 million unsecured revolving facility (the “2019 Credit Agreement”) with the Lenders, which matures on September 17, 2024. The 2019 Credit Agreement superseded the Company’s credit agreement entered into in 2016 with Bank of America, N.A serving in the same capacity. Under the 2019 Credit Agreement, the applicable margins on base rate loans range from 0.125% to 0.500% and the applicable margins on Eurocurrency loans range from 1.125% to 1.500%. The 2019 Credit Agreement provides a sublimit of $50.0 million for letters of credit. In September 2020, the Company and certain of its subsidiaries entered into a $2.0 billion unsecured revolving facility (the “2020 Credit Agreement”) with the Lenders, which matures on September 18, 2022. Under the 2020 Credit Agreement, the applicable margins on base rate loans range from 0.500% to 0.875% and the applicable margins on Eurocurrency loans range from 1.500% to 1.875%. The 2020 Credit Agreement does not support the issuance of letters of credit. Subject to satisfaction of certain conditions, the Company may request that the borrowing capacity for each of the Credit Agreements be increased by an additional $500.0 million. Any amounts borrowed pursuant to the Credit Agreements are guaranteed by certain of the Company’s existing and future domestic subsidiaries, subject to certain exceptions. The Credit Agreements contain customary representations and warranties and affirmative and negative covenants, including financial covenants to maintain (x) subject to certain limited exceptions, a consolidated leverage ratio of 3.50 to 1.00, subject to an increase to 4.00 to 1.00 following a material acquisition and (y) a consolidated interest coverage ratio of 2.50 to 1.00, in each case measured on a quarterly basis. As of December 31, 2020, the Company was in compliance with the covenants described above. The Credit Agreements also contain 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. Direct costs related to the Credit Agreements, which were not material to the Company’s financial statements, were deferred and recorded over the term of the Credit Agreements. 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, 2020 or 2019.

Segment Information

12 Months Ended

Dec. 31, 2020

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:


	2020		2019		2018
	(in thousands)
TRIKAFTA/KAFTRIO	$	3,863,824	$	420,105	$	—
SYMDEKO/SYMKEVI	628,577		1,417,668		768,657
ORKAMBI	907,512		1,331,891		1,262,166
KALYDECO	802,870		991,062		1,007,502
Total product revenues, net	$	6,202,783	$	4,160,726	$	3,038,325

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:


	2020		2019		2018
	(in thousands)
United States	$	4,829,282	$	3,062,555	$	2,365,079
Outside of the United States
Europe	1,126,460		885,762		543,179
Other	249,941		214,504		139,339
Total revenues outside of the United States	1,376,401		1,100,266		682,518
Total revenues	$	6,205,683	$	4,162,821	$	3,047,597

Significant Customers

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


	Percent of Total Gross Product Revenues						Percent of Accounts Receivable
	Year Ended December 31,						As of December 31,
	2020		2019		2018		2020		2019
McKesson Corporation	20	%	17	%	14	%	14	%	22	%
Accredo/Curascript	15	%	14	%	14	%	10	%	15	%
Walgreen Co.	14	%	15	%	20	%	10	%	14	%
Lloyds Pharmacy*	<10%		<10%		<10%		19	%	<10%
*A wholly-owned subsidiary of McKesson Corporation in the U.K.

Long-lived Assets by Location

Long-lived assets by location consisted of the following:


	As of December 31,
	2020		2019
	(in thousands)
United States	$	1,207,748	$	768,572
Outside of the United States
United Kingdom	61,462		57,383
Other	14,888		7,327
Total long-lived assets outside of the United States	76,350		64,710
Total long-lived assets	$	1,284,098	$	833,282

- Definition

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

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 31
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8924-108599

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 34
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8981-108599

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 21
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8721-108599

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 40
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9031-108599

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (f)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (e)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 26
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8844-108599

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 41
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9038-108599

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8736-108599

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 42
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9054-108599

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 15
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8657-108599

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 21
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8721-108599

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-URI http://asc.fasb.org/topic&trid=2134510

+ Details

Quarterly Financial Data (unaudited)

12 Months Ended

Dec. 31, 2020

Quarterly Financial Information Disclosure [Abstract]

Quarterly Financial Data (unaudited)

The following tables set forth the Company’s quarterly financial data for the two years ended December 31, 2020:


	Three Months Ended
	March 31, 2020		June 30, 2020		September 30, 2020		December 31, 2020
	(in thousands, except per share amounts)
Revenues:
Product revenues, net	$	1,515,107	$	1,524,485	$	1,536,271	$	1,626,920
Collaborative and royalty revenues	—		—		2,000		900
Total revenues	1,515,107		1,524,485		1,538,271		1,627,820
Costs and expenses:
Cost of sales	162,497		184,520		186,182		203,101
Research and development expenses (1)	448,528		420,928		493,497		466,584
Sales, general and administrative expenses	182,258		191,804		184,551		211,843
Change in fair value of contingent consideration	1,600		9,200		1,800		500
Total costs and expenses	794,883		806,452		866,030		882,028
Income from operations	720,224		718,033		672,241		745,792
Interest income	12,576		4,243		3,100		2,320
Interest expense	(14,136)		(13,871)		(13,856)		(16,288)
Other (expense) income, net (2)	(61,130)		116,365		84,386		156,799
Income before provision for income taxes	657,534		824,770		745,871		888,623
Provision for (benefit from) income taxes (3)	54,781		(12,500)		78,437		284,433
Net income attributable to Vertex	$	602,753	$	837,270	$	667,434	$	604,190

Amounts per share attributable to Vertex common shareholders:
Net income:
Basic	$	2.32	$	3.22	$	2.56	$	2.32
Diluted	$	2.29	$	3.18	$	2.53	$	2.30
Shares used in per share calculations:
Basic	259,815		259,637		260,392		260,038
Diluted	263,515		263,403		264,079		263,106


	Three Months Ended
	March 31, 2019		June 30, 2019		September 30, 2019		December 31, 2019
	(in thousands, except per share amounts)
Revenues:
Product revenues, net (4)	$	857,253	$	940,380	$	949,828	$	1,413,265
Collaborative and royalty revenues	1,182		913		—		—
Total revenues	858,435		941,293		949,828		1,413,265
Costs and expenses:
Cost of sales	95,092		135,740		131,914		185,012
Research and development expenses (1)	339,490		379,091		555,948		480,011
Sales, general and administrative expenses	147,045		156,502		159,674		195,277
Change in fair value of contingent consideration	—		—		2,959		1,500
Total costs and expenses	581,627		671,333		850,495		861,800
Income from operations	276,808		269,960		99,333		551,465
Interest income	15,615		18,076		17,628		12,359
Interest expense	(14,868)		(14,837)		(14,548)		(14,249)
Other income (expense), net (2)	42,610		53,939		(31,747)		127,375
Income before provision for income taxes	320,165		327,138		70,666		676,950
Provision for income taxes	51,534		59,711		13,148		93,716
Net income attributable to Vertex	$	268,631	$	267,427	$	57,518	$	583,234

Amounts per share attributable to Vertex common shareholders:
Net income:
Basic	$	1.05	$	1.04	$	0.22	$	2.26
Diluted	$	1.03	$	1.03	$	0.22	$	2.23
Shares used in per share calculations:
Basic	255,695		256,154		256,946		258,003
Diluted	260,175		259,822		260,473		262,108

1.The Company incurred research and development expenses of $75.0 million related to its 2020 Moderna Agreement in the third quarter of 2020 and $175.0 million related to its CRISPR DMD/DM1 Agreement in the third quarter of 2019. See Note B, “Collaborative Arrangements.”

2.In 2020 and 2019, “Other income (expense), net” was primarily related to changes in the fair value of the Company’s investments in corporate equity securities, and from sales of certain corporate equity securities. See Note E, “Marketable Securities and Equity Investments.”

3.In the second quarter of 2020, the Company completed an intra-entity transfer of intellectual property rights to the U.K., resulting in a deferred tax benefit of $209.0 million. See Note O, “Income Taxes.”

4.In the fourth quarter of 2019, the Company updated its transaction price and recognized net product revenues of $155.8 million related to prior period ORKAMBI sales upon reaching a reimbursement agreement with the French government for ORKAMBI, including ORKAMBI distributed through early access programs. See Note A, “Nature of Business and Accounting Policies.”

Nature of Business and Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2020

Accounting Policies [Abstract]

Basis of Presentation

Basis of PresentationThe accompanying consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), reflect the operations of (i) the Company, (ii) its wholly-owned subsidiaries and (iii) a consolidated variable interest entity (“VIE”). In 2018, the Company deconsolidated BioAxone Biosciences, Inc. (“BioAxone”), a VIE the Company had consolidated since 2014. As of December 31, 2020 and 2019, the Company did 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 Q, “Segment Information,” for enterprise-wide disclosures regarding the Company’s revenues, major customers and long-lived assets by geographic area.

Use of Estimates

Revenue Recognition

Product Revenues, Net

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.

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

Cash and Cash EquivalentsThe 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

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.

Accounts Receivable

Accounts ReceivableThe 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 credit losses, which has not been significant to date, is determined based on existing contractual payment terms, historical payment patterns, current economic conditions and the Company’s expectation for future economic conditions.

Stock-based Compensation Expense

Research and Development Expenses

Inventories

Property and Equipment


Description						Estimated Useful Life
Buildings and improvements						15 to 40 years
Furniture and equipment						7 to 10 years
Leasehold improvements; assets under finance leases						The shorter of the useful life of the assets or the estimated remaining term of the associated lease
Computers and software						3 to 5 years

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

GoodwillThe 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.

Deconsolidation and Discontinued Operations

Deconsolidation

Discontinued Operations

Embedded Derivatives and Hedging Activities

Embedded Derivatives

Hedging Activities

Restructuring Expenses

Comprehensive Income

Foreign Currency Translation and Transactions

Foreign Currency Translation and TransactionsThe majority of the Company’s operations occur in entities that have the U.S. dollar denominated as their functional currency. The assets and liabilities of the Company’s entities with functional currencies other than the U.S. dollar are translated into U.S. dollars at rates of exchange in effect at the end of the year. Revenue and expense amounts for these entities 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 loss.”

Net Income Per Share Attributable to Vertex Common Shareholders

Recently Adopted Accounting Standards and Recently Issued Accounting Standards

Recently Adopted Accounting Standards

Internal-Use Software

Fair Value Measurement

Credit Losses

Leases

Revenue Recognition

Equity Investments

Recently Issued Accounting Standards

Income Taxes

Nature of Business and Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2020

Accounting Policies [Abstract]

Schedule of Property and Equipment


Description						Estimated Useful Life
Buildings and improvements						15 to 40 years
Furniture and equipment						7 to 10 years
Leasehold improvements; assets under finance leases						The shorter of the useful life of the assets or the estimated remaining term of the associated lease
Computers and software						3 to 5 years

Property and equipment, net consisted of the following:


	As of December 31,
	2020		2019
	(in thousands)
Buildings and improvements	$	876,091	$	713,412
Furniture and equipment	346,698		317,567
Leasehold improvements	234,585		175,769
Computers and software	258,612		230,872
Land	33,128		—
Total property and equipment, gross	1,749,114		1,437,620
Less: accumulated depreciation	(790,580)		(692,540)
Total property and equipment, net	$	958,534	$	745,080

Earnings Per Share (Tables)

12 Months Ended

Dec. 31, 2020

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 per share for the periods ended:


	2020		2019		2018
	(in thousands, except per share amounts)
Basic net income attributable to Vertex per common share calculation:
Net income attributable to Vertex common shareholders	$	2,711,647	$	1,176,810	$	2,096,896
Less: Undistributed earnings allocated to participating securities	—		—		(501)
Net income attributable to Vertex common shareholders—basic	$	2,711,647	$	1,176,810	$	2,096,395

Basic weighted-average common shares outstanding	259,841		256,728		254,292
Basic net income attributable to Vertex per common share	$	10.44	$	4.58	$	8.24

Diluted net income attributable to Vertex per common share calculation:
Net income attributable to Vertex common shareholders	$	2,711,647	$	1,176,810	$	2,096,896
Less: Undistributed earnings allocated to participating securities	—		—		(492)
Net income attributable to Vertex common shareholders—diluted	$	2,711,647	$	1,176,810	$	2,096,404

Weighted-average shares used to compute basic net income per common share	259,841		256,728		254,292
Effect of potentially dilutive securities:
Stock options	1,801		2,231		2,913
Restricted stock units (including PSUs) and restricted stock	1,741		1,700		1,963
Employee stock purchase program	13		14		17
Weighted-average shares used to compute diluted net income per common share	263,396		260,673		259,185
Diluted net income attributable to Vertex per common share	$	10.29	$	4.51	$	8.09

Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share


	2020	2019	2018
	(in thousands)
Stock options	312	2,833	2,217
Unvested restricted stock units (including PSUs) and restricted stock	257	6	5

Fair Value Measurements (Tables)

12 Months Ended

Dec. 31, 2020

Fair Value Disclosures [Abstract]

Financial Assets and Liabilities Subject to Fair Value Measurements


	As of December 31, 2020								As of December 31, 2019
			Fair Value Hierarchy								Fair Value Hierarchy
	Total		Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3
	(in thousands)
Financial instruments carried at fair value (asset position):
Cash equivalents:
Money market funds	$	3,141,053	$	3,141,053	$	—	$	—	$	791,039	$	791,039	$	—	$	—
Corporate debt securities	—		—		—		—		6,070		—		6,070		—
Commercial paper	—		—		—		—		29,472		—		29,472		—
Marketable securities:
Corporate equity securities	195,781		15,650		180,131		—		282,084		261,797		20,287		—
Government-sponsored enterprise securities	80,063		80,063		—		—		12,733		12,733		—		—
Corporate debt securities	231,598		—		231,598		—		301,799		—		301,799		—
Commercial paper	163,268		—		163,268		—		102,356		—		102,356		—
Prepaid expenses and other current assets:
Foreign currency forward contracts	—		—		—		—		9,725		—		9,725		—
Total financial assets	$	3,811,763	$	3,236,766	$	574,997	$	—	$	1,535,278	$	1,065,569	$	469,709	$	—

Financial instruments carried at fair value (liability position):
Other current liabilities:
Foreign currency forward contracts	$	(59,184)	$	—	$	(59,184)	$	—	$	(5,533)	$	—	$	(5,533)	$	—
Long-term contingent consideration	(189,600)		—		—		(189,600)		(176,500)		—		—		(176,500)
Other long-term liabilities:
Foreign currency forward contracts	(4,283)		—		(4,283)		—		(1,821)		—		(1,821)		—
Total financial liabilities	$	(253,067)	$	—	$	(63,467)	$	(189,600)	$	(183,854)	$	—	$	(7,354)	$	(176,500)

Schedule of Fair Value of Our Contingent Consideration Liabilities

The following table represents a rollforward of the fair value of the Company’s contingent consideration liabilities:


	Year Ended December 31, 2020
	(in thousands)
Balance at December 31, 2019	$	176,500
Increase in fair value of contingent payments	13,100
Balance at December 31, 2020	$	189,600

Marketable Securities and Equity Investments (Tables)

12 Months Ended

Dec. 31, 2020

Investments, Debt and Equity Securities [Abstract]

Summary of Cash, Cash Equivalents and Marketable Securities


	As of December 31, 2020								As of December 31, 2019
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
	(in thousands)
Cash equivalents:
Money market funds	$	3,141,053	$	—	$	—	$	3,141,053	$	791,039	$	—	$	—	$	791,039
Corporate debt securities	—		—		—		—		6,070		—		—		6,070
Commercial paper	—		—		—		—		29,470		3		(1)		29,472
Total cash equivalents	$	3,141,053	$	—	$	—	$	3,141,053	$	826,579	$	3	$	(1)	$	826,581
Marketable securities:
Government-sponsored enterprise securities	$	80,046	$	17	$	—	$	80,063	$	12,689	$	44	$	—	$	12,733
Corporate debt securities	231,263		377		(42)		231,598		301,458		391		(50)		301,799
Commercial paper	163,286		19		(37)		163,268		102,240		121		(5)		102,356
Total marketable debt securities	474,595		413		(79)		474,929		416,387		556		(55)		416,888
Corporate equity securities	51,427		144,354		—		195,781		113,829		168,255		—		282,084
Total marketable securities	$	526,022	$	144,767	$	(79)	$	670,710	$	530,216	$	168,811	$	(55)	$	698,972

Available-for-sale debt securities were classified on the Company’s consolidated balance sheets as follows at fair value:


	December 31,
	2020		2019
	(in thousands)
Cash and cash equivalents	$	3,141,053	$	826,581
Marketable securities	474,929		416,888
Total	$	3,615,982	$	1,243,469

Available-for-sale debt securities by contractual maturity were as follows:


	December 31,
	2020		2019
	(in thousands)
Matures within one year	$	3,526,185	$	1,137,942
Matures after one year through five years	89,797		105,527
Total	$	3,615,982	$	1,243,469

Schedule of Company’s Net Unrealized Gains on Corporate Equity Securities

During the three years ended December 31, 2020, the Company’s net unrealized gains on corporate equity securities held at the conclusion of each period were as follows:


	2020		2019		2018
	(in thousands)
Net unrealized gains	$	136,167	$	143,175	$	2,558

Schedule of Sale of Equity Investments

During the years ended December 31, 2020 and 2019, the Company sold the common stock of publicly traded companies, which were primarily sales of its investment in CRISPR, resulting in the following:


	2020		2019
	(in thousands)
Proceeds received	$	437,567	$	94,936
Weighted-average cost basis	$	103,332	$	29,825

Accumulated Other Comprehensive Income (Loss) (Tables)

12 Months Ended

Dec. 31, 2020

Equity [Abstract]

Schedule 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 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
Other comprehensive income before reclassifications	10,332		1,039		—		11,513		22,884
Amounts reclassified from accumulated other comprehensive income (loss)	—		—		—		(25,516)		(25,516)
Net current period other comprehensive income (loss)	10,332		1,039		—		(14,003)		(2,632)
Balance as of December 31, 2019	$	(895)	$	503	$	—	$	(1,581)	$	(1,973)
Other comprehensive loss before reclassifications	(14,783)		(169)		—		(54,467)		(69,419)
Amounts reclassified from accumulated other comprehensive income (loss)	—		—		—		2,912		2,912
Net current period other comprehensive loss	(14,783)		(169)		—		(51,555)		(66,507)
Balance as of December 31, 2020	$	(15,678)	$	334	$	—	$	(53,136)	$	(68,480)

Hedging (Tables)

12 Months Ended

Dec. 31, 2020

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Cash Flow Hedging Instruments

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


	As of December 31,
	2020		2019
Foreign Currency	(in thousands)
Euro	$	745,099	$	501,197
British pound sterling	160,427		87,032
Australian dollar	99,922		89,705
Canadian dollar	86,468		50,452
Total foreign currency forward contracts	$	1,091,916	$	728,386

Derivative Instruments, Gain (Loss)

During the three years ended December 31, 2020, the Company recognized the following related to foreign currency forward contacts in its consolidated statements of operations:


	December 31,
	2020		2019		2018
	(in thousands)
Designated as hedging instruments - Reclassified from AOCI
Product revenues, net	$	(3,714)	$	32,546	$	(1,252)
Not designated as hedging instruments
Other income (expense), net	$	22,113	$	(4,838)	$	(623)

Total reported in the Consolidated Statement of Operations
Product revenues, net	$	6,202,783	$	4,160,726	$	3,038,325
Other income (expense), net	$	296,420	$	192,177	$	(790)

Schedule of Foreign Exchange Contracts


As of December 31, 2020
Assets			Liabilities
Classification	Fair Value		Classification	Fair Value
(in thousands)
Prepaid expenses and other current assets	$	—	Other current liabilities	$	(59,184)
Other assets	—		Other long-term liabilities	(4,283)
Total assets	$	—	Total liabilities	$	(63,467)


As of December 31, 2019
Assets			Liabilities
Classification	Fair Value		Classification	Fair Value
(in thousands)
Prepaid expenses and other current assets	$	9,725	Other current liabilities	$	(5,533)
Other assets	—		Other long-term liabilities	(1,821)
Total assets	$	9,725	Total liabilities	$	(7,354)

Derivatives Offsetting


	As of December 31, 2020
	Gross Amounts Recognized		Gross Amounts Offset		Gross Amounts Presented		Gross Amounts Not Offset		Legal Offset
Foreign currency forward contracts	(in thousands)
Total assets	$	—	$	—	$	—	$	—	$	—
Total liabilities	(63,467)		—		(63,467)		—		(63,467)


	As of December 31, 2019
	Gross Amounts Recognized		Gross Amounts Offset		Gross Amounts Presented		Gross Amounts Not Offset		Legal Offset
Foreign currency forward contracts	(in thousands)
Total assets	$	9,725	$	—	$	9,725	$	(7,354)	$	2,371
Total liabilities	(7,354)		—		(7,354)		7,354		—

Derivatives Offsetting


	As of December 31, 2020
	Gross Amounts Recognized		Gross Amounts Offset		Gross Amounts Presented		Gross Amounts Not Offset		Legal Offset
Foreign currency forward contracts	(in thousands)
Total assets	$	—	$	—	$	—	$	—	$	—
Total liabilities	(63,467)		—		(63,467)		—		(63,467)


	As of December 31, 2019
	Gross Amounts Recognized		Gross Amounts Offset		Gross Amounts Presented		Gross Amounts Not Offset		Legal Offset
Foreign currency forward contracts	(in thousands)
Total assets	$	9,725	$	—	$	9,725	$	(7,354)	$	2,371
Total liabilities	(7,354)		—		(7,354)		7,354		—

Inventories (Tables)

12 Months Ended

Dec. 31, 2020

Inventory Disclosure [Abstract]

Schedule of Inventories by Type

Inventories consisted of the following:


	As of December 31,
	2020		2019
	(in thousands)
Raw materials	$	46,232	$	26,247
Work-in-process	161,324		107,021
Finished goods	73,221		34,234
Total	$	280,777	$	167,502

Property and Equipment (Tables)

12 Months Ended

Dec. 31, 2020

Property, Plant and Equipment [Abstract]

Schedule of Property and Equipment


Description						Estimated Useful Life
Buildings and improvements						15 to 40 years
Furniture and equipment						7 to 10 years
Leasehold improvements; assets under finance leases						The shorter of the useful life of the assets or the estimated remaining term of the associated lease
Computers and software						3 to 5 years

Property and equipment, net consisted of the following:


	As of December 31,
	2020		2019
	(in thousands)
Buildings and improvements	$	876,091	$	713,412
Furniture and equipment	346,698		317,567
Leasehold improvements	234,585		175,769
Computers and software	258,612		230,872
Land	33,128		—
Total property and equipment, gross	1,749,114		1,437,620
Less: accumulated depreciation	(790,580)		(692,540)
Total property and equipment, net	$	958,534	$	745,080

Additional Balance Sheet Detail (Tables)

12 Months Ended

Dec. 31, 2020

Payables and Accruals [Abstract]

Summary of Accrued Expenses

Accrued expenses consisted of the following:


	As of December 31,
	2020		2019
	(in thousands)
Product revenue accruals	$	781,903	$	641,368
Payroll and benefits	169,387		159,464
Research, development and commercial contract costs	136,704		105,663
Royalty payable	165,404		98,578
Tax related accruals	104,173		72,293
Other	47,400		39,546
Total	$	1,404,971	$	1,116,912

Summary Other Current Liabilities

Other current liabilities consisted of the following:


	As of December 31,
	2020		2019
	(in thousands)
Contract liabilities	$	191,519	$	62,332
Fair value of cash flow hedges	59,184		5,533
Finance lease liabilities	42,434		38,794
Other	24,286		23,646
Total	$	317,423	$	130,305

Additional Cash Flow Information

The cash, cash equivalents and restricted cash balances at the beginning and ending of each period presented in the Company’s consolidated statements of cash flows consisted of the following:


	As of December 31,
	2020		2019		2018		2017
	(in thousands)
Cash and cash equivalents	$	5,988,187	$	3,109,322	$	2,650,134	$	1,665,412
Prepaid expenses and other current assets	658		8,004		4,910		2,114
Other assets	—		3,355		3,209		—
Cash, cash equivalents and restricted cash per consolidated statement of cash flows	$	5,988,845	$	3,120,681	$	2,658,253	$	1,667,526

Leases (Tables)

12 Months Ended

Dec. 31, 2020

Leases [Abstract]

Lease Cost

The components of lease cost recorded in the Company’s consolidated statement of operations were as follows:


	2020		2019

Operating lease cost	$	23,128	$	11,972
Finance lease cost
Amortization of leased assets	51,223		49,778
Interest on lease liabilities	50,188		52,839
Variable lease cost	30,776		27,997
Sublease income	(4,021)		(6,391)
Net lease cost	$	151,294	$	136,195

Components of Lease in Balance Sheets

The Company’s leases are included on its consolidated balance sheets as follows:


	As of December 31,
	2020		2019
	(in thousands)
Finance leases
Property and equipment, net	$	431,193	$	445,336
Total finance lease assets	$	431,193	$	445,336

Other current liabilities	$	42,434	$	38,795
Long-term finance lease liabilities	539,042		538,576
Total finance lease liabilities	$	581,476	$	577,371

Operating leases
Operating lease assets	$	325,564	$	88,202
Total operating lease assets	$	325,564	$	88,202

Other current liabilities	$	10,521	$	11,504
Long-term operating lease liabilities	350,463		84,292
Total operating lease liabilities	$	360,984	$	95,796

Finance Lease, Liability, Maturity

Maturities of the Company’s finance and operating lease liabilities as of December 31, 2020 were as follows:


Year	Finance Leases		Operating Leases		Total
	(in thousands)
2021	$	85,470	$	15,266	$	100,736
2022	90,020		34,119		124,139
2023	88,185		34,663		122,848
2024	93,434		34,113		127,547
2025	93,421		31,564		124,985
Thereafter	416,455		320,684		737,139
Total lease payments	866,985		470,409		1,337,394
Less: tenant allowance	—		(36,051)		(36,051)
Less: amount representing interest	(285,509)		(73,374)		(358,883)
Present value of lease liabilities	$	581,476	$	360,984	$	942,460

Operating Lease, Liability, Maturity

Maturities of the Company’s finance and operating lease liabilities as of December 31, 2020 were as follows:


Year	Finance Leases		Operating Leases		Total
	(in thousands)
2021	$	85,470	$	15,266	$	100,736
2022	90,020		34,119		124,139
2023	88,185		34,663		122,848
2024	93,434		34,113		127,547
2025	93,421		31,564		124,985
Thereafter	416,455		320,684		737,139
Total lease payments	866,985		470,409		1,337,394
Less: tenant allowance	—		(36,051)		(36,051)
Less: amount representing interest	(285,509)		(73,374)		(358,883)
Present value of lease liabilities	$	581,476	$	360,984	$	942,460

Weighted-Average Remaining Lease Terms and Discount Rates

The weighted-average remaining lease terms and discount rates related to the Company’s leases were as follows:


	As of December 31,
	2020		2019
Weighted-average remaining lease term (in years)
Finance leases	11.58		9.74
Operating leases	14.10		9.70

Weighted-average discount rate
Finance leases	8.36	%	9.04	%
Operating leases	2.28	%	3.75	%

Supplemental Cash Flow Information

Supplemental cash flow information related to the Company’s leases was as follows:


	2020		2019
	(in thousands)
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases	$	16,254	$	10,650
Operating cash flows from finance leases	$	48,908	$	50,527
Financing cash flows from finance leases	$	42,275	$	39,185

Right-of-use assets obtained in exchange for lease obligations
Operating leases *	$	293,604	$	34,605
Finance leases	$	33,128	$	—
* 2019 includes $33.7 million acquired in 2019 pursuant to the Company’s acquisitions of Semma and Exonics.

Common Stock, Preferred Stock and Equity Plans (Tables)

12 Months Ended

Dec. 31, 2020

Equity [Abstract]

Schedule of Stock and Stock Equity Plans

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

As of December 31, 2020

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

7,231,859

13,385,321

2006 Stock and Option Plan

Employees, Non-employee Directors and Consultants

NSO,
RS and RSU

383,818

—

Total

7,615,677

13,385,321

Outstanding and Vested Options

The following table summarizes information related to the outstanding and exercisable options during the year ended December 31, 2020:


	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, 2019	6,272	$	134.92
Granted	23	$	286.27
Exercised	(1,883)	$	121.42
Forfeited	(174)	$	165.39
Expired	—	$	—
Outstanding at December 31, 2020	4,238	$	140.47	6.34	$	397,211
Exercisable at December 31, 2020	2,894	$	125.83	5.73	$	313,936

Stock Options Outstanding and Exercisable

The following table summarizes information about stock options outstanding and exercisable at December 31, 2020:


	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)
$36.28–$40.00	60	0.85	$	38.06	60	$	38.06
$40.01–$60.00	154	1.73	$	47.07	154	$	47.07
$60.01–$80.00	97	3.25	$	74.53	97	$	74.54
$80.01–$100.00	991	5.34	$	88.93	937	$	89.07
$100.01–$120.00	127	4.07	$	109.24	127	$	109.22
$120.01–$140.00	271	4.71	$	129.49	270	$	129.50
$140.01–$160.00	715	7.05	$	155.49	415	$	155.42
$160.01–$180.00	578	7.47	$	168.40	312	$	166.01
$180.01–$200.00	1,222	7.85	$	185.31	499	$	184.92
$200.01–$286.27	23	9.42	$	286.27	23	$	286.27
Total	4,238	6.34	$	140.47	2,894	$	125.83

Restricted Stock and Restricted Stock Units Activity

The following table summarizes the restricted stock unit and restricted stock activity of the Company during the year ended December 31, 2020:


	Restricted Stock Units (excluding PSUs)			Restricted Stock
	Number of Shares	Weighted-average Grant-date Fair Value		Number of Units	Weighted-average Grant-date Fair Value
	(in thousands)	(per share)		(in thousands)	(per share)
Unvested at December 31, 2019	3,131	$	163.61	92	$	91.97
Granted	1,244	$	258.45	—	$	—
Vested	(1,443)	$	159.10	(92)	$	91.97
Cancelled	(210)	$	193.84	—	$	—
Unvested at December 31, 2020	2,722	$	206.99	—	$	—

PSU Activity

The following table summarizes the PSU activity of the Company during the year ended December 31, 2020:


	Performance-Based RSU
	Number of Units	Weighted-average Grant-date Fair Value
	(in thousands)	(per share)
Unvested at December 31, 2019 (1)	734	$	143.21
Granted (2)	547	$	241.38
Vested	(577)	$	114.11
Cancelled	(48)	$	194.46
Unvested at December 31, 2020	656	$	202.06

(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 2020 and (ii) any change in the number of shares issuable pursuant to outstanding PSUs based on performance certification during 2020.

Shares Issued Under Employee Stock Purchase Plan

In 2020, the following shares were issued to employees under the ESPP:


	Year Ended December 31, 2020
	(in thousands, except per share amount)
Number of shares	203,055
Average price paid per share	$	167.93

Stock-based Compensation Expense (Tables)

12 Months Ended

Dec. 31, 2020

Share-based Payment Arrangement [Abstract]

Stock-Based Compensation Expense

The effect of stock-based compensation expense during the three years ended December 31, 2020 was as follows:


	2020		2019		2018
	(in thousands)
Stock-based compensation expense by line item:
Cost of sales	$	5,579	$	5,575	$	4,543
Research and development expenses	262,690		224,558		203,112
Sales, general and administrative expenses	161,192		130,356		117,392
Total stock-based compensation expense included in costs and expenses	429,461		360,489		325,047
Income tax effect	(146,959)		(124,225)		—
Total stock-based compensation included in costs and expenses, net of tax	$	282,502	$	236,264	$	325,047

Stock-Based Compensation Expense by Type of Award

The stock-based compensation expense by type of award during the three years ended December 31, 2020 was as follows:


	2020		2019		2018
	(in thousands)
Stock-based compensation expense by type of award:
Restricted stock units (including PSUs) and restricted stock	$	360,364	$	254,276	$	207,845
Stock options	59,722		96,737		107,854
ESPP share issuances	12,984		11,196		9,933
Stock-based compensation expense related to inventories	(3,609)		(1,720)		(585)
Total stock-based compensation expense included in costs and expenses	$	429,461	$	360,489	$	325,047

Unrecognized Stock-Based Compensation Expense


	As of December 31, 2020
	Unrecognized Expense		Weighted-average Recognition Period
	(in thousands)		(in years)
Type of award:
Restricted stock units (including PSUs) and restricted stock	$	401,100	1.88
Stock options	$	62,392	1.77
ESPP share issuances	$	11,333	0.59

Schedule of Assumptions Used to Estimate the Grant Date Fair Value of Options

The fair value of each option granted during 2020, 2019 and 2018 was estimated on the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions:


	2020	2019	2018
Stock options granted	22,636	1,520,743	2,297,328

Expected stock price volatility	35.87%	36.99%	40.50%
Risk-free interest rate	0.43%	2.32%	2.61%
Expected term of options (in years)	4.67	4.27	4.55
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 2020, 2019 and 2018:


	2020	2019	2018
Expected stock price volatility	37.70%	33.43%	36.51%
Risk-free interest rate	0.11%	2.08%	2.36%
Expected term (in years)	0.71	0.74	0.75
Expected annual dividends	—	—	—

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2020

Income Tax Disclosure [Abstract]

Schedule of Components of Income Before Provision for (Benefit From) Income Taxes

The components of income before provision for (benefit from) income taxes during the three years ended December 31, 2020 consisted of the following:


	2020		2019		2018
	(in thousands)
United States	$	2,885,423	$	1,263,379	$	812,086
Foreign	231,375		131,540		(211,845)
Income before provision for (benefit from) income taxes	$	3,116,798	$	1,394,919	$	600,241

Schedule of Components of Provision for (Benefit From) Income Taxes

The components of the provision for (benefit from) income taxes during the three years ended December 31, 2020 consisted of the following:


	2020		2019		2018
	(in thousands)
Current taxes:
Federal	$	71,377	$	—	$	772
Foreign	37,582		37,194		15,600
State	18,851		13,528		9,018
Total current taxes	127,810		50,722		25,390
Deferred taxes:
Federal	510,220		184,312		(1,105,053)
Foreign	(239,579)		(24,797)		(364,919)
State	6,700		7,872		(42,280)
Total deferred taxes	277,341		167,387		(1,512,252)
Provision for (benefit from) income taxes	$	405,151	$	218,109	$	(1,486,862)

Reconciliation of the Provision for (Benefit From) Income Taxes


	2020		2019		2018
	(in thousands)
Income before provision for (benefit from) income taxes	$	3,116,798	$	1,394,919	$	600,241

Expected provision for income taxes	654,528		292,933		126,051
State taxes, net of federal benefit	18,596		8,478		8,680
Foreign income tax rate differential	5,433		6,178		23,427
Tax credits	(55,824)		(59,459)		(52,629)
Benefit from income taxes attributable to valuation allowances	17,384		(2,672)		(1,563,169)
Tax rate change	(37,688)		—		—
Stock compensation (benefit), shortfalls and cancellations	(70,628)		(56,324)		(49,044)
Officer’s compensation	13,079		10,666		8,310
Long-term intercompany receivable write-off	(53,821)		—		—
Deconsolidation of VIE	—		—		(9,390)
Uncertain tax positions	39,808		14,070		15,431
Inter-entity transfer of intellectual property rights	(209,000)		—		—
U.S. deemed dividend	71,727		79		64
Other	11,557		4,160		5,407
Provision for (benefit from) income taxes	$	405,151	$	218,109	$	(1,486,862)

Schedule of Deferred Tax Assets and Liabilities

The components of the deferred taxes were as follows:


	As of December 31,
	2020		2019
	(in thousands)
Deferred tax assets:
Net operating loss	$	140,563	$	512,256
Tax credit carryforwards	406,120		549,543
Intangible assets	507,484		275,290
Deferred revenues	20,962		18,833
Stock-based compensation	89,203		85,199
Accrued expenses	47,326		44,367
Finance lease liabilities	118,749		119,160
Operating lease assets	65,046		13,114
Other	987		8,596
Gross deferred tax assets	1,396,440		1,626,358
Valuation allowance	(213,750)		(205,192)
Total deferred tax assets	1,182,690		1,421,166
Deferred tax liabilities:
Property and equipment	(116,955)		(101,235)
Acquired intangibles	(87,025)		(87,160)
Unrealized gain	(17,553)		(28,838)
Operating lease liabilities	(63,310)		(13,118)
Other	(15,068)		—
Net deferred tax assets	$	882,779	$	1,190,815

Summary of Unrecognized Tax Benefits

Unrecognized tax benefits during the three years ended December 31, 2020 were as follows:


	2020		2019		2018
	(in thousands)
Balance at beginning of the period	$	33,920	$	19,549	$	3,814
Increases related to current period tax positions	26,653		14,407		9,704
Increases related to prior period tax positions	26,732		598		6,031
Decreases related to prior period tax positions	—		(156)		—
Settlement with tax authorities	—		(478)		—
Statute of limitations expiration	(657)		—		—
Balance at end of period	$	86,648	$	33,920	$	19,549

Segment Information (Tables)

12 Months Ended

Dec. 31, 2020

Segment Reporting [Abstract]

Revenues by Product

Product revenues, net consisted of the following:


	2020		2019		2018
	(in thousands)
TRIKAFTA/KAFTRIO	$	3,863,824	$	420,105	$	—
SYMDEKO/SYMKEVI	628,577		1,417,668		768,657
ORKAMBI	907,512		1,331,891		1,262,166
KALYDECO	802,870		991,062		1,007,502
Total product revenues, net	$	6,202,783	$	4,160,726	$	3,038,325

Revenues and Property and Equipment by Location

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


	2020		2019		2018
	(in thousands)
United States	$	4,829,282	$	3,062,555	$	2,365,079
Outside of the United States
Europe	1,126,460		885,762		543,179
Other	249,941		214,504		139,339
Total revenues outside of the United States	1,376,401		1,100,266		682,518
Total revenues	$	6,205,683	$	4,162,821	$	3,047,597

Long-lived assets by location consisted of the following:


	As of December 31,
	2020		2019
	(in thousands)
United States	$	1,207,748	$	768,572
Outside of the United States
United Kingdom	61,462		57,383
Other	14,888		7,327
Total long-lived assets outside of the United States	76,350		64,710
Total long-lived assets	$	1,284,098	$	833,282

Significant Customers


	Percent of Total Gross Product Revenues						Percent of Accounts Receivable
	Year Ended December 31,						As of December 31,
	2020		2019		2018		2020		2019
McKesson Corporation	20	%	17	%	14	%	14	%	22	%
Accredo/Curascript	15	%	14	%	14	%	10	%	15	%
Walgreen Co.	14	%	15	%	20	%	10	%	14	%
Lloyds Pharmacy*	<10%		<10%		<10%		19	%	<10%
*A wholly-owned subsidiary of McKesson Corporation in the U.K.

Quarterly Financial Data (unaudited) (Tables)

12 Months Ended

Dec. 31, 2020

Quarterly Financial Information Disclosure [Abstract]

Schedule of Quarterly Financial Data

The following tables set forth the Company’s quarterly financial data for the two years ended December 31, 2020:


	Three Months Ended
	March 31, 2020		June 30, 2020		September 30, 2020		December 31, 2020
	(in thousands, except per share amounts)
Revenues:
Product revenues, net	$	1,515,107	$	1,524,485	$	1,536,271	$	1,626,920
Collaborative and royalty revenues	—		—		2,000		900
Total revenues	1,515,107		1,524,485		1,538,271		1,627,820
Costs and expenses:
Cost of sales	162,497		184,520		186,182		203,101
Research and development expenses (1)	448,528		420,928		493,497		466,584
Sales, general and administrative expenses	182,258		191,804		184,551		211,843
Change in fair value of contingent consideration	1,600		9,200		1,800		500
Total costs and expenses	794,883		806,452		866,030		882,028
Income from operations	720,224		718,033		672,241		745,792
Interest income	12,576		4,243		3,100		2,320
Interest expense	(14,136)		(13,871)		(13,856)		(16,288)
Other (expense) income, net (2)	(61,130)		116,365		84,386		156,799
Income before provision for income taxes	657,534		824,770		745,871		888,623
Provision for (benefit from) income taxes (3)	54,781		(12,500)		78,437		284,433
Net income attributable to Vertex	$	602,753	$	837,270	$	667,434	$	604,190

Amounts per share attributable to Vertex common shareholders:
Net income:
Basic	$	2.32	$	3.22	$	2.56	$	2.32
Diluted	$	2.29	$	3.18	$	2.53	$	2.30
Shares used in per share calculations:
Basic	259,815		259,637		260,392		260,038
Diluted	263,515		263,403		264,079		263,106


	Three Months Ended
	March 31, 2019		June 30, 2019		September 30, 2019		December 31, 2019
	(in thousands, except per share amounts)
Revenues:
Product revenues, net (4)	$	857,253	$	940,380	$	949,828	$	1,413,265
Collaborative and royalty revenues	1,182		913		—		—
Total revenues	858,435		941,293		949,828		1,413,265
Costs and expenses:
Cost of sales	95,092		135,740		131,914		185,012
Research and development expenses (1)	339,490		379,091		555,948		480,011
Sales, general and administrative expenses	147,045		156,502		159,674		195,277
Change in fair value of contingent consideration	—		—		2,959		1,500
Total costs and expenses	581,627		671,333		850,495		861,800
Income from operations	276,808		269,960		99,333		551,465
Interest income	15,615		18,076		17,628		12,359
Interest expense	(14,868)		(14,837)		(14,548)		(14,249)
Other income (expense), net (2)	42,610		53,939		(31,747)		127,375
Income before provision for income taxes	320,165		327,138		70,666		676,950
Provision for income taxes	51,534		59,711		13,148		93,716
Net income attributable to Vertex	$	268,631	$	267,427	$	57,518	$	583,234

Amounts per share attributable to Vertex common shareholders:
Net income:
Basic	$	1.05	$	1.04	$	0.22	$	2.26
Diluted	$	1.03	$	1.03	$	0.22	$	2.23
Shares used in per share calculations:
Basic	255,695		256,154		256,946		258,003
Diluted	260,175		259,822		260,473		262,108

Nature of Business and Accounting Policies - Business Narrative (Details) $ in Billions	12 Months Ended
	Dec. 31, 2020 USD ($) segment
Accounting Policies [Abstract]
Cash, cash equivalents and marketable securities \| $	$ 6.7
Number of operating segments \| segment	1

Nature of Business and Accounting Policies - Revenue Recognition (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2020	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Contract liabilities	$ 191,500				$ 62,300				$ 191,500	$ 62,300
Revenues related to performance obligations									62,300	24,900	$ 1,700
Revenues	$ 1,627,820	$ 1,538,271	$ 1,524,485	$ 1,515,107	1,413,265	$ 949,828	$ 941,293	$ 858,435	$ 6,205,683	$ 4,162,821	$ 3,047,597
ORKAMBI
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Revenues					$ 155,800

- Definition

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

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 30
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8906-108599

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 40
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9031-108599

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 41
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9038-108599

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8933-108599

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 4
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130543-203045

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8736-108599

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e8736-108599

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 42
-URI http://asc.fasb.org/extlink&oid=120311839&loc=d3e9054-108599

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 5
-URI http://asc.fasb.org/extlink&oid=121604090&loc=SL49130545-203045

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 924
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SAB Topic 11.L)
-URI http://asc.fasb.org/extlink&oid=6472922&loc=d3e499488-122856

+ Details

Nature of Business and Accounting Policies - Share-Based Compensation (Details)	12 Months Ended
	Dec. 31, 2020
Accounting Policies [Abstract]
Percentage of employees eligible for acceleration of equity awards (less than) (percent)	5.00%

Nature of Business and Accounting Policies - Property and Equipment (Details)	12 Months Ended
	Dec. 31, 2020
Buildings and Improvements \| Minimum
Property, Plant and Equipment [Line Items]
Property and equipment useful life	15 years
Buildings and Improvements \| Maximum
Property, Plant and Equipment [Line Items]
Property and equipment useful life	40 years
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
Technology Equipment \| Minimum
Property, Plant and Equipment [Line Items]
Property and equipment useful life	3 years
Technology Equipment \| Maximum
Property, Plant and Equipment [Line Items]
Property and equipment useful life	5 years

Nature of Business and Accounting Policies - Goodwill Hedging Activities Foreign Currency Gain (Loss) (Details) $ in Millions	12 Months Ended
	Dec. 31, 2020 USD ($) segment	Dec. 31, 2019 USD ($)	Dec. 31, 2018 USD ($)
Derivative [Line Items]
Number of operating segments \| segment	1
Net foreign currency transaction loss \| $	$ 16.1	$ 5.2	$ 1.1
Foreign currency forward contracts \| Not designated as hedging instrument
Derivative [Line Items]
Derivative term	1 month

Nature of Business and Accounting Policies - Leases (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019	Jan. 01, 2019	Jan. 01, 2018
Lessee, Lease, Description [Line Items]
Accumulated deficit	$ (858,669)	$ 1,852,978
Accounting Standards Update 2016-02 \| Cumulative Effect, Period of Adoption, Adjustment
Lessee, Lease, Description [Line Items]
Accumulated deficit			$ 40,300
Accounting Standards Update 2014-09 \| Cumulative Effect, Period of Adoption, Adjustment
Lessee, Lease, Description [Line Items]
Accumulated deficit				$ 8,300

Nature of Business and Accounting Policies - Equity Investments (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019	Jan. 01, 2018
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Accumulated deficit	$ (858,669)	$ 1,852,978
Accounting standards update 2016-01, financial instruments \| Cumulative Effect, Period of Adoption, Adjustment
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Accumulated deficit			$ 25,100

Collaborative Arrangements - CRISPR Therapeutics AG (Details)	3 Months Ended		12 Months Ended
	Dec. 31, 2019 USD ($) target	Sep. 30, 2019 USD ($)	Dec. 31, 2020 USD ($)	Dec. 31, 2019 USD ($)	Dec. 31, 2018 USD ($)
CRISPR Therapeutics
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Collaborative funding	$ 30,000,000.0
Right to license, number of targets (up to) \| target	3
Collaborative arrangement development and regulatory potential milestone payments maximum	$ 410,000,000.0
CTX001 Co-Co Agreement
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Collaborative arrangement research and development expenses			$ 50,600,000	$ 30,100,000	$ 19,700,000
CRISPR DMD/DM1
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Collaborative arrangement development and regulatory potential milestone payments maximum			800,000,000.0
Collaborative arrangement research and development expenses			$ 25,000,000.0
Collaborative arrangement, development and commercialization rights potential maximum milestone payments		$ 175,000,000.0

Collaborative Arrangements - Kymera, Moderna and Other In-License Agreements (Details)	1 Months Ended		12 Months Ended
	Sep. 30, 2020 USD ($)	May 31, 2019 USD ($) target	Dec. 31, 2020 USD ($)	Dec. 31, 2019 USD ($)	Dec. 31, 2018 USD ($)
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Investment in collaborative partner, pursuant to convertible loan agreement			$ 84,600,000	$ 63,300,000	$ 46,900,000
Kymera Therapeutics
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Up-front payment		$ 50,000,000.0		$ 50,000,000.0
Right to license, number of targets (up to) \| target		6
Collaborative arrangement development and regulatory potential milestone payments maximum		$ 170,000,000.0
Investment in collaborative partner, pursuant to convertible loan agreement		$ 20,000,000.0
Moderna Agreement
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Collaborative arrangement development and regulatory potential milestone payments maximum	$ 380,000,000.0
Collaborative arrangement, up-front payment paid	$ 75,000,000.0
Skyhawk Therapeutics Inc
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Up-front payment			$ 40,000,000.0

Collaborative Arrangements - BioAxone Biosciences, Inc. (Details) - USD ($) $ in Thousands	1 Months Ended	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Intangible asset impairment charge		$ 0	$ 0	$ 29,000
Loss attributable to noncontrolling interest		$ 0	$ 0	9,793
Other Intangible Assets \| BioAxone Biosciences, Inc \| Variable Interest Entity, Primary Beneficiary
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Intangible asset impairment charge	$ 29,000			29,000
Loss attributable to noncontrolling interest				$ 9,800

Collaborative Arrangements - Merck KGaA (Details) - Merck KGaA $ in Millions	1 Months Ended	12 Months Ended
	Jan. 31, 2017 developmentProgram clinical-stage_program	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Right to license, number of development programs \| developmentProgram	4
Right to license, number of clinical stage programs \| clinical-stage_program	2
Number of pre-clinical stage programs \| developmentProgram	2
Collaborative arrangement development and regulatory potential milestone payments maximum \| $			$ 230.0
Up-front payment \| $		$ 65.0

Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2020	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Basic net income attributable to Vertex per common share calculation:
Net income attributable to Vertex common shareholders	$ 604,190	$ 667,434	$ 837,270	$ 602,753	$ 583,234	$ 57,518	$ 267,427	$ 268,631	$ 2,711,647	$ 1,176,810	$ 2,096,896
Less: Undistributed earnings allocated to participating securities									0	0	(501)
Net income attributable to Vertex common shareholders—basic									$ 2,711,647	$ 1,176,810	$ 2,096,395
Basic weighted-average common shares outstanding (in shares)	260,038	260,392	259,637	259,815	258,003	256,946	256,154	255,695	259,841	256,728	254,292
Basic net income attributable to Vertex per common share ( in usd per share)	$ 2.32	$ 2.56	$ 3.22	$ 2.32	$ 2.26	$ 0.22	$ 1.04	$ 1.05	$ 10.44	$ 4.58	$ 8.24
Diluted net income attributable to Vertex per common share calculation:
Less: Undistributed earnings allocated to participating securities									$ 0	$ 0	$ (492)
Net income attributable to Vertex common shareholders—diluted									$ 2,711,647	$ 1,176,810	$ 2,096,404
Employee stock purchase plan (in shares)									13	14	17
Weighted-average shares used to compute diluted net income per common share (in shares)	263,106	264,079	263,403	263,515	262,108	260,473	259,822	260,175	263,396	260,673	259,185
Diluted net income attributable to Vertex per common share ( in usd per share)	$ 2.30	$ 2.53	$ 3.18	$ 2.29	$ 2.23	$ 0.22	$ 1.03	$ 1.03	$ 10.29	$ 4.51	$ 8.09
Stock options
Diluted net income attributable to Vertex per common share calculation:
Share-based payment arrangements (in shares)									1,801	2,231	2,913
Antidilutive securities excluded from computation of earnings per share (in shares)									312	2,833	2,217
Restricted stock units (including PSUs) and restricted stock
Diluted net income attributable to Vertex per common share calculation:
Share-based payment arrangements (in shares)									1,741	1,700	1,963
Unvested restricted stock units (including PSUs) and restricted stock
Diluted net income attributable to Vertex per common share calculation:
Antidilutive securities excluded from computation of earnings per share (in shares)									257	6	5

Fair Value Measurements - Additional Information (Details) $ in Millions	Dec. 31, 2020 USD ($)	Dec. 31, 2019 USD ($)
Fair value of financial assets and liabilities
Cash	$ 2,800.0	$ 2,300.0
Level 3
Fair value of financial assets and liabilities
Remaining milestone payment	$ 678.3
Level 3 \| Minimum \| Discount Rate
Fair value of financial assets and liabilities
Contingent consideration, measurement input (percent)	0.004
Level 3 \| Maximum \| Discount Rate
Fair value of financial assets and liabilities
Contingent consideration, measurement input (percent)	0.019

Fair Value Measurements - Financial Assets and Liabilities Subject to Fair Value Measurements (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Financial instruments carried at fair value (asset position):
Marketable securities:	$ 3,615,982	$ 1,243,469
Financial instruments carried at fair value (liability position):
Long-term contingent consideration	(189,600)	(176,500)
Recurring basis
Financial instruments carried at fair value (asset position):
Total financial assets	3,811,763	1,535,278
Financial instruments carried at fair value (liability position):
Total financial liabilities	(253,067)	(183,854)
Recurring basis \| Level 1
Financial instruments carried at fair value (asset position):
Total financial assets	3,236,766	1,065,569
Financial instruments carried at fair value (liability position):
Total financial liabilities	0	0
Recurring basis \| Level 2
Financial instruments carried at fair value (asset position):
Total financial assets	574,997	469,709
Financial instruments carried at fair value (liability position):
Total financial liabilities	(63,467)	(7,354)
Recurring basis \| Level 3
Financial instruments carried at fair value (asset position):
Total financial assets	0	0
Financial instruments carried at fair value (liability position):
Total financial liabilities	(189,600)	(176,500)
Corporate equity securities \| Recurring basis
Financial instruments carried at fair value (asset position):
Marketable securities:	195,781	282,084
Corporate equity securities \| Recurring basis \| Level 1
Financial instruments carried at fair value (asset position):
Marketable securities:	15,650	261,797
Corporate equity securities \| Recurring basis \| Level 2
Financial instruments carried at fair value (asset position):
Marketable securities:	180,131	20,287
Corporate equity securities \| Recurring basis \| Level 3
Financial instruments carried at fair value (asset position):
Marketable securities:	0	0
Government-sponsored enterprise securities \| Recurring basis
Financial instruments carried at fair value (asset position):
Marketable securities:	80,063	12,733
Government-sponsored enterprise securities \| Recurring basis \| Level 1
Financial instruments carried at fair value (asset position):
Marketable securities:	80,063	12,733
Government-sponsored enterprise securities \| Recurring basis \| Level 2
Financial instruments carried at fair value (asset position):
Marketable securities:	0	0
Government-sponsored enterprise securities \| Recurring basis \| Level 3
Financial instruments carried at fair value (asset position):
Marketable securities:	0	0
Corporate debt securities \| Recurring basis
Financial instruments carried at fair value (asset position):
Marketable securities:	231,598	301,799
Corporate debt securities \| Recurring basis \| Level 1
Financial instruments carried at fair value (asset position):
Marketable securities:	0	0
Corporate debt securities \| Recurring basis \| Level 2
Financial instruments carried at fair value (asset position):
Marketable securities:	231,598	301,799
Corporate debt securities \| Recurring basis \| Level 3
Financial instruments carried at fair value (asset position):
Marketable securities:	0	0
Commercial paper \| Recurring basis
Financial instruments carried at fair value (asset position):
Marketable securities:	163,268	102,356
Commercial paper \| Recurring basis \| Level 1
Financial instruments carried at fair value (asset position):
Marketable securities:	0	0
Commercial paper \| Recurring basis \| Level 2
Financial instruments carried at fair value (asset position):
Marketable securities:	163,268	102,356
Commercial paper \| Recurring basis \| Level 3
Financial instruments carried at fair value (asset position):
Marketable securities:	0	0
Money market funds \| Recurring basis
Financial instruments carried at fair value (asset position):
Cash equivalents:	3,141,053	791,039
Money market funds \| Recurring basis \| Level 1
Financial instruments carried at fair value (asset position):
Cash equivalents:	3,141,053	791,039
Money market funds \| Recurring basis \| Level 2
Financial instruments carried at fair value (asset position):
Cash equivalents:	0	0
Money market funds \| Recurring basis \| Level 3
Financial instruments carried at fair value (asset position):
Cash equivalents:	0	0
Corporate debt securities \| Recurring basis
Financial instruments carried at fair value (asset position):
Cash equivalents:	0	6,070
Corporate debt securities \| Recurring basis \| Level 1
Financial instruments carried at fair value (asset position):
Cash equivalents:	0	0
Corporate debt securities \| Recurring basis \| Level 2
Financial instruments carried at fair value (asset position):
Cash equivalents:	0	6,070
Corporate debt securities \| Recurring basis \| Level 3
Financial instruments carried at fair value (asset position):
Cash equivalents:	0	0
Commercial paper \| Recurring basis
Financial instruments carried at fair value (asset position):
Cash equivalents:	0	29,472
Commercial paper \| Recurring basis \| Level 1
Financial instruments carried at fair value (asset position):
Cash equivalents:	0	0
Commercial paper \| Recurring basis \| Level 2
Financial instruments carried at fair value (asset position):
Cash equivalents:	0	29,472
Commercial paper \| Recurring basis \| Level 3
Financial instruments carried at fair value (asset position):
Cash equivalents:	0	0
Prepaid expenses and other current assets \| Foreign currency forward contracts \| Recurring basis
Financial instruments carried at fair value (asset position):
Derivative Asset	0	9,725
Prepaid expenses and other current assets \| Foreign currency forward contracts \| Recurring basis \| Level 1
Financial instruments carried at fair value (asset position):
Derivative Asset	0	0
Prepaid expenses and other current assets \| Foreign currency forward contracts \| Recurring basis \| Level 2
Financial instruments carried at fair value (asset position):
Derivative Asset	0	9,725
Prepaid expenses and other current assets \| Foreign currency forward contracts \| Recurring basis \| Level 3
Financial instruments carried at fair value (asset position):
Derivative Asset	0	0
Other current liabilities \| Recurring basis
Financial instruments carried at fair value (liability position):
Long-term contingent consideration	(189,600)	(176,500)
Other current liabilities \| Recurring basis \| Level 1
Financial instruments carried at fair value (liability position):
Long-term contingent consideration	0	0
Other current liabilities \| Recurring basis \| Level 2
Financial instruments carried at fair value (liability position):
Long-term contingent consideration	0	0
Other current liabilities \| Recurring basis \| Level 3
Financial instruments carried at fair value (liability position):
Long-term contingent consideration	(189,600)	(176,500)
Other current liabilities \| Foreign currency forward contracts \| Recurring basis
Financial instruments carried at fair value (liability position):
Derivative Liability	(59,184)	(5,533)
Other current liabilities \| Foreign currency forward contracts \| Recurring basis \| Level 1
Financial instruments carried at fair value (liability position):
Derivative Liability	0	0
Other current liabilities \| Foreign currency forward contracts \| Recurring basis \| Level 2
Financial instruments carried at fair value (liability position):
Derivative Liability	(59,184)	(5,533)
Other current liabilities \| Foreign currency forward contracts \| Recurring basis \| Level 3
Financial instruments carried at fair value (liability position):
Derivative Liability	0	0
Other long-term liabilities \| Foreign currency forward contracts \| Recurring basis
Financial instruments carried at fair value (liability position):
Derivative Liability	(4,283)	(1,821)
Other long-term liabilities \| Foreign currency forward contracts \| Recurring basis \| Level 1
Financial instruments carried at fair value (liability position):
Derivative Liability	0	0
Other long-term liabilities \| Foreign currency forward contracts \| Recurring basis \| Level 2
Financial instruments carried at fair value (liability position):
Derivative Liability	(4,283)	(1,821)
Other long-term liabilities \| Foreign currency forward contracts \| Recurring basis \| Level 3
Financial instruments carried at fair value (liability position):
Derivative Liability	$ 0	$ 0

Fair Value Measurements - Fair Value of Contingent Consideration Liabilities (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2020	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance at December 31, 2019				$ 176,500					$ 176,500
Increase in fair value of contingent consideration	$ 500	$ 1,800	$ 9,200	$ 1,600	$ 1,500	$ 2,959	$ 0	$ 0	13,100	$ 4,459	$ 0
Balance at December 31, 2020	$ 189,600				$ 176,500				$ 189,600	$ 176,500

Marketable Securities and Equity Investments - Additional Information (Details) - USD ($)	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Summary of cash equivalents and marketable securities
Cash	$ 2,800,000,000	$ 2,300,000,000
Other-than-temporary declines in fair value of available-for-sale debt securities	0	0	$ 0
Net unrealized gains	136,167,000	143,175,000	2,558,000
Weighted-average cost basis	51,427,000	113,829,000
Publicly Traded Companies Sale
Summary of cash equivalents and marketable securities
Proceeds received	437,567,000	94,936,000	$ 0
Weighted-average cost basis	103,332,000	$ 29,825,000
Other assets
Summary of cash equivalents and marketable securities
Equity securities without readily determinable fair value, amount	$ 20,800,000

Marketable Securities and Equity Investments - Summary of Cash Equivalents and Marketable Securities (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Total marketable debt securities
Fair Value	$ 3,615,982	$ 1,243,469
Corporate equity securities
Amortized Cost	51,427	113,829
Gross Unrealized Gains	144,354	168,255
Gross Unrealized Losses	0	0
Fair Value	195,781	282,084
Amortized Cost	526,022	530,216
Gross Unrealized Gains	144,767	168,811
Gross Unrealized Losses	(79)	(55)
Fair Value	670,710	698,972
Cash equivalents:
Total marketable debt securities
Amortized Cost	3,141,053	826,579
Gross Unrealized Gains	0	3
Gross Unrealized Losses	0	(1)
Fair Value	3,141,053	826,581
Marketable securities:
Total marketable debt securities
Amortized Cost	474,595	416,387
Gross Unrealized Gains	413	556
Gross Unrealized Losses	(79)	(55)
Fair Value	474,929	416,888
Money market funds \| Cash equivalents:
Total marketable debt securities
Amortized Cost	3,141,053	791,039
Gross Unrealized Gains	0	0
Gross Unrealized Losses	0	0
Fair Value	3,141,053	791,039
Government-sponsored enterprise securities \| Marketable securities:
Total marketable debt securities
Amortized Cost	80,046	12,689
Gross Unrealized Gains	17	44
Gross Unrealized Losses	0	0
Fair Value	80,063	12,733
Corporate debt securities \| Cash equivalents:
Total marketable debt securities
Amortized Cost	0	6,070
Gross Unrealized Gains	0	0
Gross Unrealized Losses	0	0
Fair Value	0	6,070
Corporate debt securities \| Marketable securities:
Total marketable debt securities
Amortized Cost	231,263	301,458
Gross Unrealized Gains	377	391
Gross Unrealized Losses	(42)	(50)
Fair Value	231,598	301,799
Commercial paper \| Cash equivalents:
Total marketable debt securities
Amortized Cost	0	29,470
Gross Unrealized Gains	0	3
Gross Unrealized Losses	0	(1)
Fair Value	0	29,472
Commercial paper \| Marketable securities:
Total marketable debt securities
Amortized Cost	163,286	102,240
Gross Unrealized Gains	19	121
Gross Unrealized Losses	(37)	(5)
Fair Value	$ 163,268	$ 102,356

Marketable Securities and Equity Investments - Available-for-Sale Debt Securities at Fair Value (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Debt Securities, Available-for-sale [Line Items]
Debt Securities	$ 3,615,982	$ 1,243,469
Cash and cash equivalents
Debt Securities, Available-for-sale [Line Items]
Debt Securities	3,141,053	826,581
Marketable securities
Debt Securities, Available-for-sale [Line Items]
Debt Securities	$ 474,929	$ 416,888

Marketable Securities and Equity Investments - Available-for-Sale Debt Securities by Contractual Maturity (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Investments, Debt and Equity Securities [Abstract]
Matures within one year	$ 3,526,185	$ 1,137,942
Matures after one year through five years	89,797	105,527
Total	$ 3,615,982	$ 1,243,469

Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
AOCI, Net of Tax [Roll Forward]
Balance	$ 6,085,244	$ 4,435,203	$ 2,042,306
Other comprehensive income before reclassifications	(69,419)	22,884	34,577
Amounts reclassified from accumulated other comprehensive income (loss)	2,912	(25,516)	1,774
Total other comprehensive (loss) income	(66,507)	(2,632)	36,351
Balance	8,686,815	6,085,244	4,435,203
Cumulative Effect, Period of Adoption, Adjustment
AOCI, Net of Tax [Roll Forward]
Balance		(40,310)	9,229
Balance			(40,310)
Foreign Currency Translation Adjustment
AOCI, Net of Tax [Roll Forward]
Balance	(895)	(11,227)	(21,031)
Other comprehensive income before reclassifications	(14,783)	10,332	8,855
Amounts reclassified from accumulated other comprehensive income (loss)	0	0	0
Total other comprehensive (loss) income	(14,783)	10,332	8,855
Balance	(15,678)	(895)	(11,227)
Foreign Currency Translation Adjustment \| Cumulative Effect, Period of Adoption, Adjustment
AOCI, Net of Tax [Roll Forward]
Balance		949
Balance			949
On Available-For-Sale Debt Securities
AOCI, Net of Tax [Roll Forward]
Balance	503	(536)	(594)
Other comprehensive income before reclassifications	(169)	1,039	58
Amounts reclassified from accumulated other comprehensive income (loss)	0	0	0
Total other comprehensive (loss) income	(169)	1,039	58
Balance	334	503	(536)
On Available-For-Sale Debt Securities \| Cumulative Effect, Period of Adoption, Adjustment
AOCI, Net of Tax [Roll Forward]
Balance		0
Balance			0
On Equity Securities
AOCI, Net of Tax [Roll Forward]
Balance	0	0	25,069
Other comprehensive income before reclassifications	0	0	0
Amounts reclassified from accumulated other comprehensive income (loss)	0	0	0
Total other comprehensive (loss) income	0	0	0
Balance	0	0	0
On Equity Securities \| Cumulative Effect, Period of Adoption, Adjustment
AOCI, Net of Tax [Roll Forward]
Balance		(25,069)
Balance			(25,069)
On Foreign Currency Forward Contracts
AOCI, Net of Tax [Roll Forward]
Balance	(1,581)	12,422	(15,016)
Other comprehensive income before reclassifications	(54,467)	11,513	25,664
Amounts reclassified from accumulated other comprehensive income (loss)	2,912	(25,516)	1,774
Total other comprehensive (loss) income	(51,555)	(14,003)	27,438
Balance	(53,136)	(1,581)	12,422
On Foreign Currency Forward Contracts \| Cumulative Effect, Period of Adoption, Adjustment
AOCI, Net of Tax [Roll Forward]
Balance		0
Balance			0
Total
AOCI, Net of Tax [Roll Forward]
Balance	(1,973)	659	(11,572)
Total other comprehensive (loss) income	(66,507)	(2,632)	36,351
Balance	$ (68,480)	(1,973)	659
Total \| Cumulative Effect, Period of Adoption, Adjustment
AOCI, Net of Tax [Roll Forward]
Balance		$ (24,120)	(24,120)
Balance			$ (24,120)

Hedging - Narrative (Details) - Foreign currency forward contracts	12 Months Ended
	Dec. 31, 2020 USD ($)
Not designated as hedging instrument
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative term	1 month
Not designated as hedging instrument \| Cash Flow Hedging
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Notional amount of foreign currency forward contract	$ 198,900,000
Minimum \| Cash Flow Hedging
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative term	1 month
Maximum \| Cash Flow Hedging
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative term	18 months

Hedging - Notional Amount (Details) - Designated as hedging instruments - Cash Flow Hedging - Foreign currency forward contracts - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Derivative [Line Items]
Derivative, Notional Amount	$ 1,091,916	$ 728,386
Euro
Derivative [Line Items]
Derivative, Notional Amount	745,099	501,197
British pound sterling
Derivative [Line Items]
Derivative, Notional Amount	160,427	87,032
Australian dollar
Derivative [Line Items]
Derivative, Notional Amount	99,922	89,705
Canadian dollar
Derivative [Line Items]
Derivative, Notional Amount	$ 86,468	$ 50,452

Hedging - Cash Flow Hedging Instruments (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2020	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Derivative Instruments, Gain (Loss) [Line Items]
Revenues	$ 1,627,820	$ 1,538,271	$ 1,524,485	$ 1,515,107	$ 1,413,265	$ 949,828	$ 941,293	$ 858,435	$ 6,205,683	$ 4,162,821	$ 3,047,597
Other income (expense), net	156,799	84,386	116,365	(61,130)	127,375	(31,747)	53,939	42,610	296,420	192,177	(790)
Foreign currency forward contracts \| Not designated as hedging instrument \| Reclassification out of Accumulated Other Comprehensive Income \| On Foreign Currency Forward Contracts
Derivative Instruments, Gain (Loss) [Line Items]
Other income (expense), net									22,113	(4,838)	(623)
Product revenues, net
Derivative Instruments, Gain (Loss) [Line Items]
Revenues	$ 1,626,920	$ 1,536,271	$ 1,524,485	$ 1,515,107	$ 1,413,265	$ 949,828	$ 940,380	$ 857,253	6,202,783	4,160,726	3,038,325
Product revenues, net \| Foreign currency forward contracts \| Designated as hedging instruments \| Reclassification out of Accumulated Other Comprehensive Income \| On Foreign Currency Forward Contracts
Derivative Instruments, Gain (Loss) [Line Items]
Revenues									$ (3,714)	$ 32,546	$ (1,252)

- Definition

+ References

+ Details

Hedging - Derivative Fair Value (Details) - Foreign currency forward contracts - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Derivative [Line Items]
Total assets	$ 0	$ 9,725
Total liabilities	(63,467)	(7,354)
Designated as hedging instruments
Derivative [Line Items]
Total assets	0	9,725
Total liabilities	(63,467)	(7,354)
Prepaid expenses and other current assets \| Designated as hedging instruments
Derivative [Line Items]
Fair value - assets	0	9,725
Other current liabilities \| Designated as hedging instruments
Derivative [Line Items]
Fair value - liabilities	(59,184)	(5,533)
Other assets \| Designated as hedging instruments
Derivative [Line Items]
Fair value - assets	0	0
Other long-term liabilities \| Designated as hedging instruments
Derivative [Line Items]
Fair value - liabilities	$ (4,283)	$ (1,821)

Hedging - Offsetting Derivatives (Details) - Foreign currency forward contracts - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Total assets
Gross Amounts Recognized	$ 0	$ 9,725
Gross Amounts Offset	0	0
Gross Amounts Presented	0	9,725
Gross Amounts Not Offset	0	(7,354)
Legal Offset	0	2,371
Total liabilities
Gross Amounts Recognized	(63,467)	(7,354)
Gross Amounts Offset	0	0
Gross Amounts Presented	(63,467)	(7,354)
Gross Amounts Not Offset	0	7,354
Legal Offset	$ (63,467)	$ 0

Inventories (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Inventory Disclosure [Abstract]
Raw materials	$ 46,232	$ 26,247
Work-in-process	161,324	107,021
Finished goods	73,221	34,234
Total	$ 280,777	$ 167,502

Property and Equipment - Property and Equipment, Net (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Property, Plant and Equipment [Line Items]
Total property and equipment, gross	$ 1,749,114	$ 1,437,620
Less: accumulated depreciation	(790,580)	(692,540)
Total property and equipment, net	958,534	745,080
Buildings and improvements
Property, Plant and Equipment [Line Items]
Total property and equipment, gross	876,091	713,412
Furniture and equipment
Property, Plant and Equipment [Line Items]
Total property and equipment, gross	346,698	317,567
Leasehold improvements
Property, Plant and Equipment [Line Items]
Total property and equipment, gross	234,585	175,769
Computers and software
Property, Plant and Equipment [Line Items]
Total property and equipment, gross	258,612	230,872
Land
Property, Plant and Equipment [Line Items]
Total property and equipment, gross	$ 33,128	$ 0

Property and Equipment - Narrative (Details) - USD ($) $ in Millions	3 Months Ended	12 Months Ended
	Sep. 30, 2020	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Property, Plant and Equipment [Line Items]
Depreciation expense		$ 109.5	$ 106.9	$ 72.4
Boston Continuous Manufacturing Facility
Property, Plant and Equipment [Line Items]
Payments to purchase buildings in cash	$ 155.3
Property and equipment useful life		40 years

Intangible Assets and Goodwill (Details) - USD ($) $ in Thousands	1 Months Ended	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Indefinite-Lived Intangible Assets [Line Items]
Other Indefinite-lived Intangible Assets		$ 400,000	$ 400,000
Intangible asset impairment charge		0	0	$ 29,000
Goodwill		$ 1,002,158	1,002,158
Semma Therapeutics, Inc.
Indefinite-Lived Intangible Assets [Line Items]
Other Indefinite-lived Intangible Assets			387,000
Goodwill			554,600
Exonics Therapeutics
Indefinite-Lived Intangible Assets [Line Items]
Other Indefinite-lived Intangible Assets			13,000
Goodwill			$ 397,100
Other Intangible Assets \| BioAxone Biosciences, Inc \| Variable Interest Entity, Primary Beneficiary
Indefinite-Lived Intangible Assets [Line Items]
Intangible asset impairment charge	$ 29,000			$ 29,000

- Details

Name:	vrtx_CollaborativeArrangementsByAgreementAxis=vrtx_SemmaTherapeuticsInc.Member
Namespace Prefix:
Data Type:	na
Balance Type:
Period Type:

Additional Balance Sheet Detail (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Accrued expenses
Product revenue accruals	$ 781,903	$ 641,368
Payroll and benefits	169,387	159,464
Research, development and commercial contract costs	136,704	105,663
Royalty payable	165,404	98,578
Tax related accruals	104,173	72,293
Other	47,400	39,546
Total	1,404,971	1,116,912
Other current liabilities
Contract liabilities	191,519	62,332
Fair value of cash flow hedges	59,184	5,533
Finance lease liabilities	42,434	38,794
Other	24,286	23,646
Total	$ 317,423	$ 130,305

Additional Cash Flow Information - Additional Cash Flow (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Restricted Cash and Cash Equivalents Items [Line Items]
Cash and cash equivalents	$ 5,988,187	$ 3,109,322	$ 2,650,134	$ 1,665,412
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Total	5,988,845	3,120,681	2,658,253	1,667,526
Prepaid expenses and other current assets
Restricted Cash and Cash Equivalents Items [Line Items]
Restricted cash and cash equivalents	658	8,004	4,910	2,114
Other assets
Restricted Cash and Cash Equivalents Items [Line Items]
Restricted cash and cash equivalents	$ 0	$ 3,355	$ 3,209	$ 0

Leases - Additional Information (Details) $ in Thousands	12 Months Ended
Leases - Additional Information (Details) $ in Thousands	Dec. 31, 2019 USD ($) ft² renewal_option	Dec. 31, 2018 USD ($)	Dec. 31, 2015 ft² term	Dec. 31, 2011 ft² lease building	Dec. 31, 2020 USD ($)
Lessee, Lease, Description [Line Items]
Operating lease assets	$ 88,202				$ 325,564
Present value of lease liabilities	$ 95,796				360,984
Rental expense		$ 17,300
Corporate Headquarters
Lessee, Lease, Description [Line Items]
Number of leases \| lease				2
Area of real estate property (in square feet) \| ft²				1,100,000
Lease agreements number of buildings \| building				2
Option to extend lease term				15 years
Optional term of lease agreement (in years)				10 years
San Diego Lease
Lessee, Lease, Description [Line Items]
Area of real estate property (in square feet) \| ft²			170,000
Length of lease			16 years
Amount of optional renewal terms \| term			2
Optional renewal term length			5 years
Cell and Genetic Therapies Lease
Lessee, Lease, Description [Line Items]
Area of real estate property (in square feet) \| ft²	269,000
Optional term of lease agreement (in years)	10 years
Lease agreement initial term	15 years
Number of optional renewal terms \| renewal_option	2
Operating lease assets					253,500
Present value of lease liabilities					$ 286,600
Buildings and improvements
Lessee, Lease, Description [Line Items]
Property and equipment useful life		40 years

Leases - Components of Lease Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019
Leases [Abstract]
Operating lease cost	$ 23,128	$ 11,972
Finance lease cost
Amortization of leased assets	51,223	49,778
Interest on lease liabilities	50,188	52,839
Variable lease cost	30,776	27,997
Sublease income	(4,021)	(6,391)
Net lease cost	$ 151,294	$ 136,195

Leases - Balance Sheet Classification of Lease Assets and Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Finance leases
Property and equipment, net	$ 431,193	$ 445,336
Total finance lease assets	431,193	445,336
Other current liabilities	42,434	38,795
Long-term finance lease liabilities	539,042	538,576
Present value of lease liabilities	581,476	577,371
Total operating lease assets	325,564	88,202
Other current liabilities	10,521	11,504
Long-term operating lease liabilities	350,463	84,292
Present value of lease liabilities	$ 360,984	$ 95,796
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List]	us-gaap:PropertyPlantAndEquipmentAndFinanceLeaseRightOfUseAssetAfterAccumulatedDepreciationAndAmortization	us-gaap:PropertyPlantAndEquipmentAndFinanceLeaseRightOfUseAssetAfterAccumulatedDepreciationAndAmortization
Finance Lease, Liability, Current, Statement of Financial Position [Extensible List]	us-gaap:OtherLiabilitiesCurrent	us-gaap:OtherLiabilitiesCurrent
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List]	us-gaap:OtherLiabilitiesCurrent	us-gaap:OtherLiabilitiesCurrent

Leases - Maturities of Operating and Financing Lease Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Finance Leases
2021	$ 85,470
2022	90,020
2023	88,185
2024	93,434
2025	93,421
Thereafter	416,455
Total lease payments	866,985
Less: tenant allowance	0
Less: amount representing interest	(285,509)
Present value of lease liabilities	581,476	$ 577,371
Operating Leases
2021	15,266
2022	34,119
2023	34,663
2024	34,113
2025	31,564
Thereafter	320,684
Total lease payments	470,409
Less: tenant allowance	(36,051)
Less: amount representing interest	(73,374)
Present value of lease liabilities	360,984	$ 95,796
Total
2021	100,736
2022	124,139
2023	122,848
2024	127,547
2025	124,985
Thereafter	737,139
Total lease payments	1,337,394
Less: tenant allowance	(36,051)
Less: amount representing interest	(358,883)
Present value of lease liabilities	$ 942,460

Leases - Weighted-Average Remaining Lease Terms and Discount Rates (Details)	Dec. 31, 2020	Dec. 31, 2019
Weighted-average remaining lease term (in years)
Finance leases	11 years 6 months 29 days	9 years 8 months 26 days
Operating leases	14 years 1 month 6 days	9 years 8 months 12 days
Weighted-average discount rate
Finance leases	8.36%	9.04%
Operating leases	2.28%	3.75%

Leases - Supplemental Cash Flow Information (Details) - USD ($)
$ in Thousands

12 Months Ended

Dec. 31, 2020

Dec. 31, 2019

Dec. 31, 2018

Cash paid for amounts included in the measurement of lease liabilities

Operating cash flows from operating leases

$ 16,254

$ 10,650

Operating cash flows from finance leases

48,908

50,527

Financing cash flows from finance leases

^[1]

42,275

39,185

$ 33,388

Right-of-use assets obtained in exchange for lease obligations

Operating leases

293,604

34,605

Finance leases

$ 33,128

Semma and Exonics Therapeutics

Right-of-use assets obtained in exchange for lease obligations

Operating leases

$ 33,700

[1]	* For the year ended December 31, 2018, amounts are related to the Company’s capital leases and construction financing lease obligations pursuant to ASC 840, Leases, which was applicable until December 31, 2018.

Common Stock, Preferred Stock and Equity Plans - Common Stock and Preferred Stock (Details)	12 Months Ended
	Dec. 31, 2020 vote shares	Dec. 31, 2019 shares
Equity [Abstract]
Common stock, shares authorized (in shares)	500,000,000	500,000,000
Common stock, number of votes per share \| vote	1
Preferred stock, shares authorized (in shares)	1,000,000	1,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0

Common Stock, Preferred Stock and Equity Plans - Share Repurchase Program (Details) - USD ($)	3 Months Ended	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	Nov. 30, 2020	Jul. 31, 2019	Jun. 30, 2019
Equity, Class of Treasury Stock [Line Items]
Repurchases of common stock		$ 539,136,000	$ 186,020,000	$ 350,043,000
Share Repurchase Program 2018
Equity, Class of Treasury Stock [Line Items]
Number of shares authorized to be repurchased				$ 500,000,000.0			$ 500,000,000.0
Repurchases of common stock (in shares)			832,186	2,093,891
Repurchases of common stock			$ 150,000,000.0	$ 350,000,000.0
Share Repurchase Program 2019
Equity, Class of Treasury Stock [Line Items]
Number of shares authorized to be repurchased						$ 500,000,000.0
Repurchases of common stock (in shares)		2,058,962	213,548
Repurchases of common stock		$ 464,000,000.0	$ 36,000,000.0
Number of shares remaining for repurchases	$ 500,000,000.0	500,000,000.0
Share Repurchase Program 2020
Equity, Class of Treasury Stock [Line Items]
Number of shares authorized to be repurchased					$ 500,000,000.0
Repurchases of common stock (in shares)	345,897
Repurchases of common stock	$ 75,100,000
Number of shares remaining for repurchases	$ 424,900,000	$ 424,900,000

Common Stock, Preferred Stock and Equity Plans - Stock and Option Plans (Details) - shares	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Awards outstanding (in shares)	7,615,677
Additional awards authorized for grant (in shares)	13,385,321
2013 Stock and Option Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Awards outstanding (in shares)	7,231,859
Additional awards authorized for grant (in shares)	13,385,321
Additional shares authorized (in shares)		5,000,000	8,000,000
2006 Stock and Option Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Awards outstanding (in shares)	383,818
Additional awards authorized for grant (in 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 - Outstanding and Vested Stock Options (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Stock Options
Outstanding at beginning of period (in shares)	6,272,000
Granted (in shares)	22,636	1,520,743	2,297,328
Exercised (in shares)	(1,883,000)
Forfeited (in shares)	(174,000)
Expired (in shares)	0
Outstanding at end of period (in shares)	4,238,000	6,272,000
Stock options exercisable at end of period (in shares)	2,894,000
Weighted-average Exercise Price
Outstanding at beginning of period ( in usd per share)	$ 134.92
Granted ( in usd per share)	286.27
Exercised ( in usd per share)	121.42
Forfeited ( in usd per share)	165.39
Expired ( in usd per share)	0
Outstanding at end of period ( in usd per share)	140.47	$ 134.92
Weighted average exercise price exercisable at the end of the period ( in usd per share)	$ 125.83
Weighted-average Remaining Contractual Life
Outstanding (in years)	6 years 4 months 2 days
Exercisable (in years)	5 years 8 months 23 days
Aggregate Intrinsic Value
Outstanding	$ 397,211
Exercisable	313,936
Total intrinsic value of stock options exercised	255,000	$ 325,900	$ 258,200
Total cash received from employees as a result of employee stock option exercises	$ 228,200	$ 317,800	$ 263,400
Weighted Average
Aggregate Intrinsic Value
Market share price ( in usd per share)	$ 233.91

Common Stock, Preferred Stock and Equity Plans - Stock Options Outstanding and Exercisable (Details) shares in Thousands	12 Months Ended
	Dec. 31, 2020 $ / shares shares
Stock options outstanding and exercisable
Options outstanding (in shares) \| shares	4,238
Options outstanding, weighted-average remaining contractual life	6 years 4 months 2 days
Options outstanding, weighted-average exercise price ( in usd per share)	$ 140.47
Options exercisable (in shares) \| shares	2,894
Options exercisable, weighted-average exercise price ( in usd per share)	$ 125.83
$36.28–$40.00
Stock options outstanding and exercisable
Exercise price, low end of range ( in usd per share)	36.28
Exercise price, high end of range ( in usd per share)	$ 40.00
Options outstanding (in shares) \| shares	60
Options outstanding, weighted-average remaining contractual life	10 months 6 days
Options outstanding, weighted-average exercise price ( in usd per share)	$ 38.06
Options exercisable (in shares) \| shares	60
Options exercisable, weighted-average exercise price ( in usd per share)	$ 38.06
$40.01–$60.00
Stock options outstanding and exercisable
Exercise price, low end of range ( in usd per share)	40.01
Exercise price, high end of range ( in usd per share)	$ 60.00
Options outstanding (in shares) \| shares	154
Options outstanding, weighted-average remaining contractual life	1 year 8 months 23 days
Options outstanding, weighted-average exercise price ( in usd per share)	$ 47.07
Options exercisable (in shares) \| shares	154
Options exercisable, weighted-average exercise price ( in usd per share)	$ 47.07
$60.01–$80.00
Stock options outstanding and exercisable
Exercise price, low end of range ( in usd per share)	60.01
Exercise price, high end of range ( in usd per share)	$ 80.00
Options outstanding (in shares) \| shares	97
Options outstanding, weighted-average remaining contractual life	3 years 3 months
Options outstanding, weighted-average exercise price ( in usd per share)	$ 74.53
Options exercisable (in shares) \| shares	97
Options exercisable, weighted-average exercise price ( in usd per share)	$ 74.54
$80.01–$100.00
Stock options outstanding and exercisable
Exercise price, low end of range ( in usd per share)	80.01
Exercise price, high end of range ( in usd per share)	$ 100.00
Options outstanding (in shares) \| shares	991
Options outstanding, weighted-average remaining contractual life	5 years 4 months 2 days
Options outstanding, weighted-average exercise price ( in usd per share)	$ 88.93
Options exercisable (in shares) \| shares	937
Options exercisable, weighted-average exercise price ( in usd per share)	$ 89.07
$100.01–$120.00
Stock options outstanding and exercisable
Exercise price, low end of range ( in usd per share)	100.01
Exercise price, high end of range ( in usd per share)	$ 120.00
Options outstanding (in shares) \| shares	127
Options outstanding, weighted-average remaining contractual life	4 years 25 days
Options outstanding, weighted-average exercise price ( in usd per share)	$ 109.24
Options exercisable (in shares) \| shares	127
Options exercisable, weighted-average exercise price ( in usd per share)	$ 109.22
$120.01–$140.00
Stock options outstanding and exercisable
Exercise price, low end of range ( in usd per share)	120.01
Exercise price, high end of range ( in usd per share)	$ 140.00
Options outstanding (in shares) \| shares	271
Options outstanding, weighted-average remaining contractual life	4 years 8 months 15 days
Options outstanding, weighted-average exercise price ( in usd per share)	$ 129.49
Options exercisable (in shares) \| shares	270
Options exercisable, weighted-average exercise price ( in usd per share)	$ 129.50
$140.01–$160.00
Stock options outstanding and exercisable
Exercise price, low end of range ( in usd per share)	140.01
Exercise price, high end of range ( in usd per share)	$ 160.00
Options outstanding (in shares) \| shares	715
Options outstanding, weighted-average remaining contractual life	7 years 18 days
Options outstanding, weighted-average exercise price ( in usd per share)	$ 155.49
Options exercisable (in shares) \| shares	415
Options exercisable, weighted-average exercise price ( in usd per share)	$ 155.42
$160.01–$180.00
Stock options outstanding and exercisable
Exercise price, low end of range ( in usd per share)	160.01
Exercise price, high end of range ( in usd per share)	$ 180.00
Options outstanding (in shares) \| shares	578
Options outstanding, weighted-average remaining contractual life	7 years 5 months 19 days
Options outstanding, weighted-average exercise price ( in usd per share)	$ 168.40
Options exercisable (in shares) \| shares	312
Options exercisable, weighted-average exercise price ( in usd per share)	$ 166.01
$180.01–$200.00
Stock options outstanding and exercisable
Exercise price, low end of range ( in usd per share)	180.01
Exercise price, high end of range ( in usd per share)	$ 200.00
Options outstanding (in shares) \| shares	1,222
Options outstanding, weighted-average remaining contractual life	7 years 10 months 6 days
Options outstanding, weighted-average exercise price ( in usd per share)	$ 185.31
Options exercisable (in shares) \| shares	499
Options exercisable, weighted-average exercise price ( in usd per share)	$ 184.92
$200.01–$286.27
Stock options outstanding and exercisable
Exercise price, low end of range ( in usd per share)	200.01
Exercise price, high end of range ( in usd per share)	$ 286.27
Options outstanding (in shares) \| shares	23
Options outstanding, weighted-average remaining contractual life	9 years 5 months 1 day
Options outstanding, weighted-average exercise price ( in usd per share)	$ 286.27
Options exercisable (in shares) \| shares	23
Options exercisable, weighted-average exercise price ( in usd per share)	$ 286.27

Common Stock, Preferred Stock and Equity Plans - Restricted Stock and Restricted Stock Units (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Restricted Stock Units (excluding PSUs)
Number of Shares
Beginning of the period (in shares)	3,131
Granted (in shares)	1,244
Vested (in shares)	(1,443)
Cancelled (in shares)	(210)
End of the period (in shares)	2,722	3,131
Weighted-average  Grant-date Fair Value
Beginning of the period ( in usd per share)	$ 163.61
Granted ( in usd per share)	258.45
Vested ( in usd per share)	159.10
Cancelled ( in usd per share)	193.84
End of the period ( in usd per share)	$ 206.99	$ 163.61
Restricted stock vested in period, total fair value	$ 370.3	$ 178.2	$ 104.8
Restricted Stock
Number of Shares
Beginning of the period (in shares)	92
Granted (in shares)	0
Vested (in shares)	(92)
Cancelled (in shares)	0
End of the period (in shares)	0	92
Weighted-average  Grant-date Fair Value
Beginning of the period ( in usd per share)	$ 91.97
Granted ( in usd per share)	0
Vested ( in usd per share)	91.97
Cancelled ( in usd per share)	0
End of the period ( in usd per share)	$ 0	$ 91.97
Restricted stock vested in period, total fair value	$ 21.4	$ 70.7	$ 114.5

Common Stock, Preferred Stock and Equity Plans - Performance-based RSUs (PSUs) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Performance-based RSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Potential awards, percent of target shares, minimum	0.00%
Potential awards, percent of target shares, maximum	200.00%
Number of Units
Beginning of the period (in shares)	734
Granted (in shares)	547
Vested (in shares)	(577)
Cancelled (in shares)	(48)
End of the period (in shares)	656	734
Weighted-average  Grant-date Fair Value
Beginning of the period ( in usd per share)	$ 143.21
Weighted average fair value ( in usd per share)	241.38
Vested ( in usd per share)	114.11
Cancelled ( in usd per share)	194.46
End of the period ( in usd per share)	$ 202.06	$ 143.21
Restricted stock vested in period, total fair value	$ 138.5	$ 73.3	$ 23.2
Financial performance shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period	3 years
Tranche one \| Performance-based RSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percent of awards in tranche	50.00%
Performance period	1 year
Vesting period	3 years
Tranche one \| Financial performance shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted-average  Grant-date Fair Value	33.30%
Tranche two \| Performance-based RSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percent of awards in tranche	50.00%
Performance period	3 years
Vesting period	3 years
Tranche two \| Financial performance shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted-average  Grant-date Fair Value	33.30%
Tranche three \| Financial performance shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted-average  Grant-date Fair Value	33.30%

Common Stock, Preferred Stock and Equity Plans - Employee Stock Purchase Plan (Details) - ESPP share issuances	12 Months Ended
	Dec. 31, 2020 period $ / shares shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Offering period (in months)	12 months
Number of purchase periods \| period	2
Duration of purchase period	6 months
Eligible employee purchase price percentage of fair value	85.00%
Number of shares authorized (in shares)	1,996,321
Number of shares (in shares)	203,055,000
Average price paid per share ( in usd per share) \| $ / shares	$ 167.93

Common Stock, Preferred Stock and Equity Plans - Employee Benefits (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Equity [Abstract]
Maximum percentage of annual compensation contributed by the participant (percent)	60.00%
Defined contribution plan, cost	$ 19.2	$ 15.8	$ 13.9

Stock-based Compensation Expense (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Stock-based compensation expense:
Stock-based compensation expense	$ 429,461	$ 360,489	$ 325,047
Income tax effect	(146,959)	(124,225)	0
Total stock-based compensation included in costs and expenses, net of tax	282,502	236,264	325,047
Stock-based compensation expense related to inventories	(3,609)	(1,720)	(585)
Stock-based compensation expense related to inventories	$ 429,461	$ 360,489	$ 325,047
Weighted-average assumptions for options and ESPP subscriptions granted
Stock options granted (in shares)	22,636	1,520,743	2,297,328
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)	37.70%	33.43%	36.51%
Risk-free interest rate (percent)	0.11%	2.08%	2.36%
Expected term of options (in years)	8 months 15 days	8 months 26 days	9 months
Expected annual dividends	$ 0	$ 0	$ 0
Weighted average fair value ( in usd per share)	$ 65.88	$ 47.79	$ 44.04
Restricted stock units (including PSUs) and restricted stock
Stock-based compensation expense:
Stock-based compensation expense	$ 360,364	$ 254,276	$ 207,845
Share-based Payment Arrangement, Additional Disclosure [Abstract]
Unrecognized Expense	$ 401,100
Weighted-average Recognition Period	1 year 10 months 17 days
Weighted-average assumptions for options and ESPP subscriptions granted
Weighted average fair value ( in usd per share)	$ 0
Stock options
Stock-based compensation expense:
Stock-based compensation expense	$ 59,722	$ 96,737	$ 107,854
Share-based Payment Arrangement, Additional Disclosure [Abstract]
Unrecognized Expense	$ 62,392
Weighted-average Recognition Period	1 year 9 months 7 days
Weighted-average grant-date fair value, granted ( in usd per share)	$ 88.37	$ 61.32	$ 60.83
Weighted-average assumptions for options and ESPP subscriptions granted
Expected stock price volatility (percent)	35.87%	36.99%	40.50%
Risk-free interest rate (percent)	0.43%	2.32%	2.61%
Expected term of options (in years)	4 years 8 months 1 day	4 years 3 months 7 days	4 years 6 months 18 days
Expected annual dividends	$ 0	$ 0	$ 0
ESPP share issuances
Stock-based compensation expense:
Stock-based compensation expense	12,984	11,196	9,933
Share-based Payment Arrangement, Additional Disclosure [Abstract]
Unrecognized Expense	$ 11,333
Weighted-average Recognition Period	7 months 2 days
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 ( in usd per share)	$ 241.38
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
Financial performance shares \| Tranche one
Weighted-average assumptions for options and ESPP subscriptions granted
Weighted-average  Grant-date Fair Value	33.30%
Financial performance shares \| Tranche two
Weighted-average assumptions for options and ESPP subscriptions granted
Weighted-average  Grant-date Fair Value	33.30%
Financial performance shares \| Tranche three
Weighted-average assumptions for options and ESPP subscriptions granted
Weighted-average  Grant-date Fair Value	33.30%
Non-financial performance shares
Weighted-average assumptions for options and ESPP subscriptions granted
Vesting period	3 years
Cost of sales
Stock-based compensation expense:
Stock-based compensation expense	$ 5,579	5,575	4,543
Research and development expenses
Stock-based compensation expense:
Stock-based compensation expense	262,690	224,558	203,112
Sales, general and administrative expenses
Stock-based compensation expense:
Stock-based compensation expense	$ 161,192	$ 130,356	$ 117,392

Income Taxes - Components of Income and Provision for (Benefit from) Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2020	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Components of income (loss) before provision for (benefit from) income taxes
United States									$ 2,885,423	$ 1,263,379	$ 812,086
Foreign									231,375	131,540	(211,845)
Income before provision for (benefit from) income taxes	$ 888,623	$ 745,871	$ 824,770	$ 657,534	$ 676,950	$ 70,666	$ 327,138	$ 320,165	3,116,798	1,394,919	600,241
Current taxes:
Federal									71,377	0	772
Foreign									37,582	37,194	15,600
State									18,851	13,528	9,018
Total current taxes									127,810	50,722	25,390
Deferred taxes:
Federal									510,220	184,312	(1,105,053)
Foreign									(239,579)	(24,797)	(364,919)
State									6,700	7,872	(42,280)
Total deferred taxes			(209,000)						277,341	167,387	(1,512,252)
Provision for (benefit from) income taxes	$ 284,433	$ 78,437	$ (12,500)	$ 54,781	$ 93,716	$ 13,148	$ 59,711	$ 51,534	$ 405,151	$ 218,109	$ (1,486,862)

Income Taxes - Effective Income Tax Reconciliation (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2020	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Income Tax Disclosure [Abstract]
Income before provision for (benefit from) income taxes	$ 888,623	$ 745,871	$ 824,770	$ 657,534	$ 676,950	$ 70,666	$ 327,138	$ 320,165	$ 3,116,798	$ 1,394,919	$ 600,241
Expected provision for income taxes									654,528	292,933	126,051
State taxes, net of federal benefit									18,596	8,478	8,680
Foreign income tax rate differential									5,433	6,178	23,427
Tax credits									(55,824)	(59,459)	(52,629)
Benefit from income taxes attributable to valuation allowances									17,384	(2,672)	(1,563,169)
Tax rate change									(37,688)	0	0
Stock compensation (benefit), shortfalls and cancellations									(70,628)	(56,324)	(49,044)
Officer’s compensation									13,079	10,666	8,310
Long-term intercompany receivable write-off									(53,821)	0	0
Deconsolidation of VIE									0	0	(9,390)
Uncertain tax positions									39,808	14,070	15,431
Inter-entity transfer of intellectual property rights									(209,000)	0	0
U.S. deemed dividend									71,727	79	64
Other									11,557	4,160	5,407
Provision for (benefit from) income taxes	$ 284,433	$ 78,437	$ (12,500)	$ 54,781	$ 93,716	$ 13,148	$ 59,711	$ 51,534	$ 405,151	$ 218,109	$ (1,486,862)

Income Taxes - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
Income Taxes - Narrative (Details) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Tax Carryforwards [Line Items]
Effective tax rate		13.00%	16.00%
Deferred tax benefit	$ 209,000	$ (277,341)	$ (167,387)	$ 1,512,252
Valuation allowance		213,750	205,192
Unrecognized tax benefits		86,648	33,920	19,549	$ 3,814
Net unrecognized tax benefits which would affect the tax rate if recognized		75,800	$ 33,900	$ 19,500
Deferred Tax Assets
Tax Carryforwards [Line Items]
Unrecognized tax benefits		48,100
Accounts Payable and Accrued Liabilities
Tax Carryforwards [Line Items]
Unrecognized tax benefits		38,500
Domestic and Foreign Tax Authority
Tax Carryforwards [Line Items]
Valuation allowance		213,800
Domestic Tax Authority
Tax Carryforwards [Line Items]
Operating loss carryforwards		97,400
Tax credit carryforwards		249,200
Operating loss carryforwards, subject to expiration		29,100
State and Local Jurisdiction
Tax Carryforwards [Line Items]
Operating loss carryforwards		708,200
Tax credit carryforwards		179,100
Foreign Tax Authority
Tax Carryforwards [Line Items]
Operating loss carryforwards		521,600
Operating loss carryforwards, subject to expiration		10,600
Operating loss carryforwards, not subject to expiration		$ 511,000

Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Deferred tax assets:
Net operating loss	$ 140,563	$ 512,256
Tax credit carryforwards	406,120	549,543
Intangible assets	507,484	275,290
Deferred revenues	20,962	18,833
Stock-based compensation	89,203	85,199
Accrued expenses	47,326	44,367
Finance lease liabilities	118,749	119,160
Operating lease assets	65,046	13,114
Other	987	8,596
Gross deferred tax assets	1,396,440	1,626,358
Valuation allowance	(213,750)	(205,192)
Total deferred tax assets	1,182,690	1,421,166
Deferred tax liabilities:
Property and equipment	(116,955)	(101,235)
Acquired intangibles	(87,025)	(87,160)
Unrealized gain	(17,553)	(28,838)
Operating lease liabilities	(63,310)	(13,118)
Other	(15,068)	0
Net deferred tax assets	$ 882,779	$ 1,190,815

Income Taxes - Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward]
Balance at beginning of the period	$ 33,920	$ 19,549	$ 3,814
Increases related to current period tax positions	26,653	14,407	9,704
Increases related to prior period tax positions	26,732	598	6,031
Decreases related to prior period tax positions	0	(156)	0
Settlement with tax authorities	0	(478)	0
Statute of limitations expiration	(657)	0	0
Balance at end of period	$ 86,648	$ 33,920	$ 19,549

Commitments and Contingencies - Revolving Credit Facility (Details)	1 Months Ended		12 Months Ended
	Sep. 30, 2020 USD ($)	Sep. 30, 2019 USD ($)	Dec. 31, 2020 USD ($) credit_agreement	Dec. 31, 2019 USD ($)
Line of Credit Facility [Line Items]
Number of credit agreements \| credit_agreement			2
Indemnification claims			$ 0
Revolving Credit Facility
Line of Credit Facility [Line Items]
Line of credit facility, current borrowing capacity		$ 500,000,000.0
Line of credit facility, maximum borrowing capacity	$ 2,000,000,000.0
Line of credit facility, additional borrowing capacity	500,000,000.0	500,000,000.0
Letter of Credit
Line of Credit Facility [Line Items]
Line of credit facility, maximum borrowing capacity				$ 50,000,000.0
Line of Credit
Line of Credit Facility [Line Items]
Debt covenant, minimum consolidated EBITDA	$ 2.50	$ 2.50
Minimum \| Line of Credit
Line of Credit Facility [Line Items]
Debt covenant, consolidated leverage ratio	3.50	3.50
Minimum \| Base Rate \| Revolving Credit Facility
Line of Credit Facility [Line Items]
Interest rate (percent)		0.125%
Basis spread on variable rate (percent)	0.50%
Minimum \| Eurodollar \| Revolving Credit Facility
Line of Credit Facility [Line Items]
Interest rate (percent)		1.125%
Basis spread on variable rate (percent)	1.50%
Maximum \| Line of Credit
Line of Credit Facility [Line Items]
Debt covenant, consolidated leverage ratio	4.00	4.00
Maximum \| Base Rate \| Revolving Credit Facility
Line of Credit Facility [Line Items]
Interest rate (percent)		0.50%
Basis spread on variable rate (percent)	0.875%
Maximum \| Eurodollar \| Revolving Credit Facility
Line of Credit Facility [Line Items]
Interest rate (percent)		1.50%
Basis spread on variable rate (percent)	1.875%

Commitments and Contingencies - Contingencies (Details) - USD ($) $ in Millions	Dec. 31, 2020	Dec. 31, 2019
Commitments and Contingencies Disclosure [Abstract]
Contingent liabilities	$ 0.0	$ 0.0

Segment Information - Revenues by Product (Details) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2020 USD ($)	Sep. 30, 2020 USD ($)	Jun. 30, 2020 USD ($)	Mar. 31, 2020 USD ($)	Dec. 31, 2019 USD ($)	Sep. 30, 2019 USD ($)	Jun. 30, 2019 USD ($)	Mar. 31, 2019 USD ($)	Dec. 31, 2020 USD ($) segment	Dec. 31, 2019 USD ($)	Dec. 31, 2018 USD ($)
Revenue from External Customer [Line Items]
Number of operating segments \| segment									1
Product revenues, net	$ 1,627,820	$ 1,538,271	$ 1,524,485	$ 1,515,107	$ 1,413,265	$ 949,828	$ 941,293	$ 858,435	$ 6,205,683	$ 4,162,821	$ 3,047,597
TRIKAFTA/KAFTRIO
Revenue from External Customer [Line Items]
Product revenues, net									3,863,824	420,105	0
SYMDEKO/SYMKEVI
Revenue from External Customer [Line Items]
Product revenues, net									628,577	1,417,668	768,657
ORKAMBI
Revenue from External Customer [Line Items]
Product revenues, net									907,512	1,331,891	1,262,166
KALYDECO
Revenue from External Customer [Line Items]
Product revenues, net									802,870	991,062	1,007,502
Product revenues, net
Revenue from External Customer [Line Items]
Product revenues, net	$ 1,626,920	$ 1,536,271	$ 1,524,485	$ 1,515,107	$ 1,413,265	$ 949,828	$ 940,380	$ 857,253	$ 6,202,783	$ 4,160,726	$ 3,038,325

- Definition

+ References

+ Details

Segment Information - Revenue by Geographic Location (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2020	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues	$ 1,627,820	$ 1,538,271	$ 1,524,485	$ 1,515,107	$ 1,413,265	$ 949,828	$ 941,293	$ 858,435	$ 6,205,683	$ 4,162,821	$ 3,047,597
United States
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues									4,829,282	3,062,555	2,365,079
Europe
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues									1,126,460	885,762	543,179
Other
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues									249,941	214,504	139,339
Total revenues outside of the United States
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenues									$ 1,376,401	$ 1,100,266	$ 682,518

- Definition

+ References

+ Details

Segment Information - Significant Customers (Details) - Credit Concentration Risk	12 Months Ended
	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Percent of Total Gross Product Revenues \| McKesson Corporation
Concentration Risk [Line Items]
Concentration risk percentage	20.00%	17.00%	14.00%
Percent of Total Gross Product Revenues \| Accredo/Curascript
Concentration Risk [Line Items]
Concentration risk percentage	15.00%	14.00%	14.00%
Percent of Total Gross Product Revenues \| Walgreen Co.
Concentration Risk [Line Items]
Concentration risk percentage	14.00%	15.00%	20.00%
Percent of Total Gross Product Revenues \| Lloyds Pharmacy
Concentration Risk [Line Items]
Concentration risk percentage	10.00%	10.00%	10.00%
Percent of Accounts Receivable \| McKesson Corporation
Concentration Risk [Line Items]
Concentration risk percentage	14.00%	22.00%
Percent of Accounts Receivable \| Accredo/Curascript
Concentration Risk [Line Items]
Concentration risk percentage	10.00%	15.00%
Percent of Accounts Receivable \| Walgreen Co.
Concentration Risk [Line Items]
Concentration risk percentage	10.00%	14.00%
Percent of Accounts Receivable \| Lloyds Pharmacy
Concentration Risk [Line Items]
Concentration risk percentage	19.00%	10.00%

Segment Information - Property and Equipment, Net by Location (Details) - USD ($) $ in Thousands	Dec. 31, 2020	Dec. 31, 2019
Revenues from External Customers and Long-Lived Assets [Line Items]
Total long-lived assets	$ 1,284,098	$ 833,282
United States
Revenues from External Customers and Long-Lived Assets [Line Items]
Total long-lived assets	1,207,748	768,572
United Kingdom
Revenues from External Customers and Long-Lived Assets [Line Items]
Total long-lived assets	61,462	57,383
Other
Revenues from External Customers and Long-Lived Assets [Line Items]
Total long-lived assets	14,888	7,327
Total long-lived assets outside of the United States
Revenues from External Customers and Long-Lived Assets [Line Items]
Total long-lived assets	$ 76,350	$ 64,710

Quarterly Financial Data (unaudited) - Quarterly Financial Data (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2020	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Revenues:
Revenues	$ 1,627,820	$ 1,538,271	$ 1,524,485	$ 1,515,107	$ 1,413,265	$ 949,828	$ 941,293	$ 858,435	$ 6,205,683	$ 4,162,821	$ 3,047,597
Costs and expenses:
Cost of sales	203,101	186,182	184,520	162,497	185,012	131,914	135,740	95,092	736,300	547,758	409,539
Research and development expenses	466,584	493,497	420,928	448,528	480,011	555,948	379,091	339,490	1,829,537	1,754,540	1,416,476
Sales, general and administrative expenses	211,843	184,551	191,804	182,258	195,277	159,674	156,502	147,045	770,456	658,498	557,616
Change in fair value of contingent consideration	500	1,800	9,200	1,600	1,500	2,959	0	0	13,100	4,459	0
Total costs and expenses	882,028	866,030	806,452	794,883	861,800	850,495	671,333	581,627	3,349,393	2,965,255	2,412,447
Income from operations	745,792	672,241	718,033	720,224	551,465	99,333	269,960	276,808	2,856,290	1,197,566	635,150
Interest income	2,320	3,100	4,243	12,576	12,359	17,628	18,076	15,615	22,239	63,678	38,352
Interest expense	(16,288)	(13,856)	(13,871)	(14,136)	(14,249)	(14,548)	(14,837)	(14,868)	(58,151)	(58,502)	(72,471)
Other income (expense), net	156,799	84,386	116,365	(61,130)	127,375	(31,747)	53,939	42,610	296,420	192,177	(790)
Income before provision for (benefit from) income taxes	888,623	745,871	824,770	657,534	676,950	70,666	327,138	320,165	3,116,798	1,394,919	600,241
Provision for income taxes	284,433	78,437	(12,500)	54,781	93,716	13,148	59,711	51,534	405,151	218,109	(1,486,862)
Net income attributable to Vertex	$ 604,190	$ 667,434	$ 837,270	$ 602,753	$ 583,234	$ 57,518	$ 267,427	$ 268,631	$ 2,711,647	$ 1,176,810	$ 2,096,896
Net income:
Basic ( in usd per share)	$ 2.32	$ 2.56	$ 3.22	$ 2.32	$ 2.26	$ 0.22	$ 1.04	$ 1.05	$ 10.44	$ 4.58	$ 8.24
Diluted (in usd per share)	$ 2.30	$ 2.53	$ 3.18	$ 2.29	$ 2.23	$ 0.22	$ 1.03	$ 1.03	$ 10.29	$ 4.51	$ 8.09
Shares used in per share calculations:
Basic (in shares)	260,038	260,392	259,637	259,815	258,003	256,946	256,154	255,695	259,841	256,728	254,292
Diluted (in shares)	263,106	264,079	263,403	263,515	262,108	260,473	259,822	260,175	263,396	260,673	259,185
Product revenues, net
Revenues:
Revenues	$ 1,626,920	$ 1,536,271	$ 1,524,485	$ 1,515,107	$ 1,413,265	$ 949,828	$ 940,380	$ 857,253	$ 6,202,783	$ 4,160,726	$ 3,038,325
Collaborative and royalty revenues
Revenues:
Revenues	$ 900	$ 2,000	$ 0	$ 0	$ 0	$ 0	$ 913	$ 1,182	$ 2,900	$ 2,095	$ 9,272

Quarterly Financial Data (unaudited) - Additional Information (Details) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended								12 Months Ended
	Sep. 30, 2020	Dec. 31, 2020	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2019	Sep. 30, 2019	Jun. 30, 2019	Mar. 31, 2019	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Schedule of Collaborative Arrangement Agreements [Line Items]
Deferred tax benefit				$ 209,000						$ (277,341)	$ (167,387)	$ 1,512,252
Product revenues, net		$ 1,627,820	$ 1,538,271	$ 1,524,485	$ 1,515,107	$ 1,413,265	$ 949,828	$ 941,293	$ 858,435	$ 6,205,683	$ 4,162,821	$ 3,047,597
Moderna Agreement
Schedule of Collaborative Arrangement Agreements [Line Items]
Collaborative arrangement, development and commercialization rights potential maximum milestone payments	$ 75,000
CRISPR DMD/DM1
Schedule of Collaborative Arrangement Agreements [Line Items]
Collaborative arrangement, development and commercialization rights potential maximum milestone payments							$ 175,000
ORKAMBI
Schedule of Collaborative Arrangement Agreements [Line Items]
Product revenues, net						$ 155,800

- Definition

+ References

+ Details

Label	Element	Value
Accounting Standards Update [Extensible List]	us-gaap_AccountingStandardsUpdateExtensibleList	Accounting Standards Update 2016-02 [Member]

- Definition

Indicates amendment to accounting standards.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 944
-SubTopic 40
-Section 65
-Paragraph 2
-Subparagraph (f)(2)
-URI http://asc.fasb.org/extlink&oid=121370832&loc=SL117420844-207641

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 944
-SubTopic 40
-Section 65
-Paragraph 2
-Subparagraph (g)(1)
-URI http://asc.fasb.org/extlink&oid=121370832&loc=SL117420844-207641

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 718
-SubTopic 10
-Section 65
-Paragraph 15
-Subparagraph (f)(2)
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+ Details