INTREXON CORPORATION
20374 Seneca Meadows Parkway
Germantown, Maryland 20876
Telephone: (301) 556-9900
April 19, 2018
VIA EDGAR
Mr. Joel Parker
Senior Assistant Chief Accountant
Office of Beverages, Apparel and Mining
Division of Corporation Finance
Securities and Exchange Commission
100 F Street, NE
Washington, DC 20549
| Re: | Intrexon Corporation |
| Form 10-K for the Fiscal Year Ended December 31, 2017 |
| Filed March 1, 2018 |
| File Number 001-36042 |
Dear Mr. Parker:
We have reviewed the comments of the staff (the “Staff”) of the Securities and Exchange Commission, as set forth in its letter dated April 9, 2018, with respect to the above-referenced filing. Enclosed herewith are the Staff’s comments followed by responses on behalf of Intrexon Corporation (the “Company”).
Form 10-K for the Fiscal Year Ended December 31, 2017
Financial Statements
Consolidated Balance Sheets, page F-5
Comment:
| 1. | Please disclose your deferred revenue from related parties on the face of the balance sheet. Refer to Rule 4-08(k) of Regulation S-X. |
Response:
The Company confirms that in future quarterly and annual filings, starting with the Company’s Form 10-Q for the period ended March 31, 2018 (the “March 31, 2018 10-Q”), it will disclose deferred revenue from related parties on the face of the balance sheet,
Mr. Joel Parker
April 19, 2018
Page 2 of 4
consistent with the Staff’s comment. Below, using the balance sheet at December 31, 2017 and 2016 disclosed in the Company’s Form 10-K for the fiscal year ended December 31, 2017 (the “2017 10-K”), is an illustrative example of the disclosure the Company will include in future filings (new language is underlined):
Intrexon Corporation and Subsidiaries
Consolidated Balance Sheets
December 31, 2017 and 2016
| (Amounts in thousands, except share data) | 2017 | 2016 | ||||||
| Liabilities and Total Equity |
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| Current liabilities |
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| Accounts payable |
$ | 8,701 | $ | 8,478 | ||||
| Accrued compensation and benefits |
6,474 | 6,540 | ||||||
| Other accrued liabilities |
21,080 | 15,776 | ||||||
| Deferred revenue, including $29,155 and $33,802 from related parties as of December 31, 2017 and 2016, respectively |
42,870 | 53,364 | ||||||
| Lines of credit |
233 | 820 | ||||||
| Current portion of long term debt |
502 | 386 | ||||||
| Deferred consideration |
— | 8,801 | ||||||
| Related party payables |
313 | 440 | ||||||
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| Total current liabilities |
80,173 | 94,605 | ||||||
| Long term debt, net of current portion |
7,535 | 7,562 | ||||||
| Deferred revenue, net of current portion, including $157,628 and $214,301 from related parties as of December 31, 2017 and 2016, respectively |
193,527 | 256,778 | ||||||
| Deferred tax liabilities, net |
15,620 | 17,007 | ||||||
| Other long term liabilities |
3,451 | 3,868 | ||||||
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| Total liabilities |
300,306 | 379,820 | ||||||
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| Commitments and contingencies (Note 17) |
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| Total equity |
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| Common stock, no par value, 200,000,000 shares authorized as of December 31, 2017 and 2016; and 122,087,040 shares and 118,688,770 shares issued and outstanding as of December 31, 2017 and 2016, respectively |
— | — | ||||||
| Additional paid-in capital |
1,397,005 | 1,325,780 | ||||||
| Accumulated deficit |
(847,820 | ) | (729,341 | ) | ||||
| Accumulated other comprehensive loss |
(15,554 | ) | (36,202 | ) | ||||
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| Total Intrexon shareholders’ equity |
533,631 | 560,237 | ||||||
| Noncontrolling interests |
12,914 | 9,011 | ||||||
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| Total equity |
546,545 | 569,248 | ||||||
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| Total liabilities and total equity |
$ | 846,851 | $ | 949,068 | ||||
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Mr. Joel Parker
April 19, 2018
Page 3 of 4
Notes to Consolidated Financial Statements
5. Collaboration and Licensing Revenue, page F-32
Comment:
| 2. | Please disclose the estimated remaining performance period for your significant collaboration agreements. |
Response:
The Company confirms that in future quarterly and annual filings, starting with the March 31, 2018 Form 10-Q, it will disclose the estimated remaining performance period for its significant collaboration agreements, consistent with the Staff’s comment. Below, using disclosure from the 2017 10-K, is an illustrative example of the disclosure the Company will include in future filings (new language is underlined):
The following table summarizes the remaining balance of deferred revenue associated with upfront and milestone payments for each significant collaboration and licensing agreement as of December 31, 2017 and 2016, including the estimated, average remaining performance period as of December 31, 2017.
| Average Remaining Performance Period (Years) |
December 31, | |||||||||||
| 2017 | 2016 | |||||||||||
| ZIOPHARM Oncology, Inc. |
6.0 | $ | 90,496 | $ | 138,809 | |||||||
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| Oragenics, Inc. |
6.4 | 6,719 | 7,766 | |||||||||
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| Fibrocell Science, Inc. |
6.9 | 16,607 | 19,026 | |||||||||
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| Genopaver, LLC |
6.3 | 1,704 | 1,977 | |||||||||
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| Intrexon Energy Partners, LLC |
6.3 | 15,625 | 18,125 | |||||||||
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| Persea Bio, LLC |
7.0 | 3,500 | 4,000 | |||||||||
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| Ares Trading S.A. |
6.4 | 40,789 | 47,178 | |||||||||
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| Intrexon Energy Partners II, LLC |
6.9 | 13,833 | 15,833 | |||||||||
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| Intrexon T1D Partners, LLC |
7.2 | 8,435 | 8,653 | |||||||||
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| Harvest start-up entities (1) |
7.4 | 18,400 | 20,208 | |||||||||
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| Other |
4.3 | 14,423 | 16,292 | |||||||||
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| Total |
$ | 230,531 | $ | 297,867 | ||||||||
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| (1) | As of December 31, 2017 and December 31, 2016, the balance of deferred revenue for collaborations with Harvest start-up entities includes Thrive Agrobiotics, Inc.; Exotech Bio, Inc.; Relieve Genetics, Inc.; AD Skincare, Inc.; Genten Therapeutics, Inc.; and CRS Bio, Inc. |
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Mr. Joel Parker
April 19, 2018
Page 4 of 4
If you have any questions concerning this letter or if you would like any additional information, please do not hesitate to call me at (301) 556-9900.
Very truly yours,
/s/ Rick L. Sterling
Rick L. Sterling
Chief Financial Officer
| cc: | Donald P. Lehr, Intrexon Corporation |
Matthew Keffer, PricewaterhouseCoopers LLP
William I. Intner, Hogan Lovells US LLP