Our manufacturing and operations expenses were as follows (in thousands):
Year Ended
December 31,
2014
2013
Manufacturing and operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $24,763 $20,509
Non-cash compensation expense related to equity awards. . . . . . . . . . . . . . . .
2,934 1,295
Total manufacturing and operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $27,697 $21,804
Manufacturing and operations expenses for the year ended December 31, 2014 were $24.8 million, and
increased compared to $20.5 million for 2013, primarily because we manufactured more drug product to support
the increase in our drug development activities. In 2014, our manufacturing expenses included drug product to
support the Phase 3 trial for ISIS-APOCIII
Rx
and additional costs associated with manufacturing drug product
using our LICA technology. All amounts exclude non-cash compensation expense related to equity awards.
R&D Support
In our research, development and patent expenses, we include support costs such as rent, repair and
maintenance for buildings and equipment, utilities, depreciation of laboratory equipment and facilities,
amortization of our intellectual property, information technology costs, procurement costs and waste disposal
costs. We call these costs R&D support costs.
The following table sets forth information on R&D support costs (in thousands):
Year Ended
December 31,
2014
2013
Personnel costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 9,875 $ 9,571
Occupancy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
7,357 6,897
Patent expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,933 10,321
Depreciation and amortization. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,243 2,464
Insurance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,197 1,108
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3,002 3,293
Total R&D support costs, excluding non-cash compensation expense
related to equity awards. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26,607 33,654
Non-cash compensation expense related to equity awards. . . . . . . . . . . . . . . .
5,979 2,298
Total R&D support costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $32,586 $35,952
R&D support costs for the year ended December 31, 2014 were $26.6 million compared to $33.7 million for
2013 and decreased primarily due to lower patent expenses in 2014. Patent expenses were higher in 2013
primarily due to non-cash charges for patents and patent applications that we wrote off in 2013 due to a careful
restructuring of our patent portfolio to focus our resources on patents and new patent applications that drive
value for our company. All amounts exclude non-cash compensation expense related to equity awards.
General and Administrative Expenses
General and administrative expenses include corporate costs required to support our company, our
employees and our stockholders. These costs include personnel and outside costs in the areas of legal, human
resources, investor relations, and finance. Additionally, we include in general and administrative expenses such
costs as rent, repair and maintenance of buildings and equipment, depreciation, utilities, information technology
and procurement costs that we need to support the corporate functions listed above.
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