Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Sep. 30, 2014 | Oct. 31, 2014 | |
Document and Entity Information [Abstract] | ' | ' |
Entity Registrant Name | 'CYTORI THERAPEUTICS, INC. | ' |
Entity Central Index Key | '0001095981 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Well-known Seasoned Issuer | 'No | ' |
Entity Voluntary Filers | 'No | ' |
Entity Current Reporting Status | 'Yes | ' |
Entity Filer Category | 'Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 92,449,197 |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q3 | ' |
Document Type | '10-Q | ' |
Amendment Flag | 'false | ' |
Document Period End Date | 30-Sep-14 | ' |
CONSOLIDATED_CONDENSED_BALANCE
CONSOLIDATED CONDENSED BALANCE SHEETS (UNAUDITED) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
Current assets: | ' | ' |
Cash and cash equivalents | $7,849,000 | $15,506,000 |
Accounts receivable, net of reserves of $1,566,000 and of $1,445,000 in 2014 and 2013, respectively | 532,000 | 4,152,000 |
Inventories, net | 5,020,000 | 3,694,000 |
Other current assets | 1,245,000 | 1,225,000 |
Total current assets | 14,646,000 | 24,577,000 |
Property and equipment, net | 1,571,000 | 1,054,000 |
Restricted cash and cash equivalents | 350,000 | 350,000 |
Other assets | 2,291,000 | 2,812,000 |
Intangibles, net | 9,534,000 | 9,345,000 |
Goodwill | 3,922,000 | 3,922,000 |
Total assets | 32,314,000 | 42,060,000 |
Current liabilities: | ' | ' |
Accounts payable and accrued expenses | 5,739,000 | 6,077,000 |
Current portion of long-term obligations, net of discount | 5,477,000 | 3,191,000 |
Termination fee obligation | 0 | 400,000 |
Puregraft divestiture obligation | 158,000 | 547,000 |
Joint Venture purchase obligation | 2,817,000 | 4,691,000 |
Warrant liability | 287,000 | 0 |
Total current liabilities | 14,478,000 | 14,906,000 |
Deferred revenues | 168,000 | 212,000 |
Long-term deferred rent and other | 629,000 | 710,000 |
Long-term obligations, net of discount, less current portion | 20,332,000 | 23,100,000 |
Total liabilities | 35,607,000 | 38,928,000 |
Commitments and contingencies | ' | ' |
Stockholders' (deficit) equity: | ' | ' |
Preferred stock, $0.001 par value; 5,000,000 shares authorized; -0- shares issued and outstanding in 2014 and 2013 | 0 | 0 |
Common stock, $0.001 par value; 145,000,000 shares authorized; 83,574,164 and 71,305,375 shares issued and outstanding in 2014 and 2013, respectively | 83,000 | 71,000 |
Additional paid-in capital | 328,684,000 | 303,710,000 |
Accumulated other comprehensive income | 457,000 | 256,000 |
Accumulated deficit | -332,517,000 | -300,905,000 |
Total stockholders' (deficit) equity | -3,293,000 | 3,132,000 |
Total liabilities and stockholders' (deficit) equity | $32,314,000 | $42,060,000 |
CONSOLIDATED_CONDENSED_BALANCE1
CONSOLIDATED CONDENSED BALANCE SHEETS (UNAUDITED) (Parenthetical) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
Current assets: | ' | ' |
Accounts receivable, reserves | $1,566,000 | $1,445,000 |
Stockholders' (deficit) equity: | ' | ' |
Preferred stock, par value (in dollars per share) | $0.00 | $0.00 |
Preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $0.00 | $0.00 |
Common stock, shares authorized (in shares) | 145,000,000 | 145,000,000 |
Common stock, shares issued (in shares) | 83,574,164 | 71,305,375 |
Common stock, shares outstanding (in shares) | 83,574,164 | 71,305,375 |
CONSOLIDATED_CONDENSED_STATEME
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (UNAUDITED) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | |
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (UNAUDITED) [Abstract] | ' | ' | ' | ' |
Product revenues | $518,000 | $1,616,000 | $2,484,000 | $4,416,000 |
Cost of product revenues | 337,000 | 931,000 | 1,524,000 | 2,296,000 |
Gross profit | 181,000 | 685,000 | 960,000 | 2,120,000 |
Development revenues: | ' | ' | ' | ' |
Development, related party | 0 | 0 | 0 | 638,000 |
Development revenue | 0 | 0 | 0 | 1,179,000 |
Government contracts and other | 585,000 | 1,095,000 | 1,345,000 | 2,503,000 |
Total development revenues | 585,000 | 1,095,000 | 1,345,000 | 4,320,000 |
Operating expenses: | ' | ' | ' | ' |
Research and development | 3,140,000 | 4,123,000 | 12,106,000 | 11,992,000 |
Sales and marketing | 1,471,000 | 1,786,000 | 5,332,000 | 6,453,000 |
General and administrative | 4,179,000 | 4,332,000 | 13,121,000 | 12,225,000 |
Change in fair value of warrant liability | -134,000 | 0 | -134,000 | -418,000 |
Change in fair value of option liability | 0 | 0 | 0 | -2,250,000 |
Total operating expenses | 8,656,000 | 10,241,000 | 30,425,000 | 28,002,000 |
Operating loss | -7,890,000 | -8,461,000 | -28,120,000 | -21,562,000 |
Other income (expense): | ' | ' | ' | ' |
Loss on asset disposal | -14,000 | 0 | -15,000 | -257,000 |
Gain on Puregraft divestiture | 0 | 4,392,000 | 0 | 4,392,000 |
Gain on previously held equity interest in joint venture | 0 | 0 | 0 | 4,892,000 |
Loss on debt extinguishment | 0 | 0 | 0 | -708,000 |
Interest income | 1,000 | 1,000 | 4,000 | 2,000 |
Interest expense | -1,260,000 | -1,094,000 | -3,286,000 | -2,456,000 |
Other income (expense), net | -222,000 | -96,000 | -195,000 | -392,000 |
Equity loss from investment in joint venture | 0 | 0 | 0 | -48,000 |
Total other income (expense) | -1,495,000 | 3,203,000 | -3,492,000 | 5,425,000 |
Net loss | -9,385,000 | -5,258,000 | -31,612,000 | -16,137,000 |
Other comprehensive income (loss) foreign currency translation adjustments | 58,000 | -108,000 | 201,000 | -142,000 |
Net comprehensive loss | ($9,327,000) | ($5,366,000) | ($31,411,000) | ($16,279,000) |
Basic and diluted net loss per common share (in dollars per share) | ($0.12) | ($0.08) | ($0.41) | ($0.24) |
Basic and diluted weighted average common shares (in shares) | 80,430,061 | 67,248,384 | 77,091,624 | 67,147,584 |
CONSOLIDATED_CONDENSED_STATEME1
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED) (USD $) | 9 Months Ended | |
Sep. 30, 2014 | Sep. 30, 2013 | |
Cash flows from operating activities: | ' | ' |
Net loss | ($31,612,000) | ($16,137,000) |
Adjustments to reconcile net loss to net cash used in operating activities: | ' | ' |
Depreciation and amortization | 525,000 | 1,169,000 |
Amortization of deferred financing costs and debt discount | 961,000 | 605,000 |
Joint venture acquisition obligation accretion | 362,000 | 204,000 |
Provision for doubtful accounts | 1,126,000 | 938,000 |
Provision for expired enzyme | 313,000 | 0 |
Change in fair value of warrant liability | -134,000 | -418,000 |
Change in fair value of option liability | 0 | -2,250,000 |
Share-based compensation expense | 2,566,000 | 2,723,000 |
Equity loss from investment in joint venture | 0 | 48,000 |
Loss on asset disposal | 15,000 | 257,000 |
Gain on previously held equity interest in joint venture | 0 | -4,892,000 |
Gain on sale of assets | 0 | -4,392,000 |
Loss on debt extinguishment | 0 | 708,000 |
Increases (decreases) in cash caused by changes in operating assets and liabilities: | ' | ' |
Accounts receivable | 2,505,000 | 361,000 |
Inventories | -1,158,000 | -975,000 |
Other current assets | -19,000 | 69,000 |
Other assets | -124,000 | -117,000 |
Accounts payable and accrued expenses | -666,000 | -1,080,000 |
Deferred revenues, related party | 0 | -638,000 |
Deferred revenues | 47,000 | -1,245,000 |
Long-term deferred rent | -81,000 | -2,000 |
Net cash used in operating activities | -25,374,000 | -25,064,000 |
Cash flows from investing activities: | ' | ' |
Purchases of property and equipment | -792,000 | -536,000 |
Expenditures for intellectual property | -255,000 | 0 |
Proceeds from Puregraft divestiture | 0 | 5,000,000 |
License agreement termination fee | -400,000 | -600,000 |
Cash acquired in purchase of the joint venture | 0 | 5,000 |
Net cash (used in) provided by investing activities | -1,447,000 | 3,869,000 |
Cash flows from financing activities: | ' | ' |
Principal payments on long-term obligations | -1,303,000 | -22,292,000 |
Proceeds from long-term obligations | 0 | 27,000,000 |
Debt issuance costs and loan fees | 0 | -1,744,000 |
Joint venture purchase payments | -2,236,000 | -141,000 |
Proceeds from exercise of employee stock options and warrants | 4,066,000 | 147,000 |
Proceeds from sale of common stock | 19,075,000 | 3,001,000 |
Costs from sale of common stock | -425,000 | -184,000 |
Net cash provided by financing activities | 19,177,000 | 5,787,000 |
Effect of exchange rate changes on cash and cash equivalents | -13,000 | -104,000 |
Net decrease in cash and cash equivalents | -7,657,000 | -15,512,000 |
Cash and cash equivalents at beginning of period | 15,506,000 | 25,717,000 |
Cash and cash equivalents at end of period | 7,849,000 | 10,205,000 |
Cash paid during period for: | ' | ' |
Interest | 1,972,000 | 1,592,000 |
Supplemental schedule of non-cash investing and financing activities: | ' | ' |
Fair value of warrants allocated to (from) additional paid-in capital | -296,000 | 949,000 |
Fair value of intangible assets acquired | 0 | 9,394,000 |
Fair value of tangible assets acquired | 0 | 260,000 |
Joint venture purchase obligation | 0 | 4,709,000 |
Fair value of previously held equity interest at acquisition date | $0 | $4,928,000 |
Basis_of_Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2014 | |
Basis of Presentation [Abstract] | ' |
Basis of Presentation | ' |
1. Basis of Presentation | |
Our accompanying unaudited consolidated condensed financial statements as of September 30, 2014 and for the three and nine months ended September 30, 2014 and 2013 have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for annual financial statements. Our consolidated condensed balance sheet at September 30, 2014 has been derived from the audited financial statements at December 31, 2013, but does not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation of the financial position and results of operations of Cytori Therapeutics, Inc., and our subsidiaries (the Company) have been included. Operating results for the three and nine months ended September 30, 2014 are not necessarily indicative of the results that may be expected for the year ending December 31, 2014. These financial statements should be read in conjunction with the Consolidated Financial Statements and notes therein included in our annual report on Form 10-K for the year ended December 31, 2013. |
Use_of_Estimates
Use of Estimates | 9 Months Ended |
Sep. 30, 2014 | |
Use of Estimates [Abstract] | ' |
Use of Estimates | ' |
2. Use of Estimates | |
The preparation of Consolidated Condensed Financial Statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions affecting the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. Our most significant estimates and critical accounting policies involve recognizing revenue, valuing warrants, determining the assumptions used in measuring share-based compensation expense, measuring accretion expense related to our acquisition of the joint venture, and valuing allowances for doubtful accounts and inventories. | |
Actual results could differ from these estimates. Management’s estimates and assumptions are reviewed regularly, and the effects of revisions are reflected in the Consolidated Condensed Financial Statements in the periods they are determined to be necessary. |
Capital_Availability
Capital Availability | 9 Months Ended | |
Sep. 30, 2014 | ||
Capital Availability [Abstract] | ' | |
Capital Availability | ' | |
3 | Capital Availability | |
We incurred net losses of $9,385,000 and $31,612,000 for the three and nine months ended September 30, 2014 and $5,258,000 and $16,137,000 for the three and nine months ended September 30, 2013, respectively. We have an accumulated deficit of $332,517,000 as of September 30, 2014. Additionally, we have used net cash of $25,374,000 and $25,064,000 to fund our operating activities for the nine months ended September 30, 2014 and 2013, respectively. To date, these operating losses have been funded primarily from outside sources of invested capital and gross profits. On October 8, 2014, we entered into a Securities Purchase Agreement with certain institutional investors pursuant to which the Company raised net proceeds of approximately $12,500,000 through the sale of units consisting of Series A 3.6% convertible preferred stock and warrants to purchase common stock. | ||
We have had, and we will likely continue to have, an ongoing need to raise additional cash from outside sources to fund our future operations. | ||
We believe our plans to raise additional cash from outside sources coupled with our cost reduction initiatives recently implemented and, if necessary, further cost containment efforts are sufficient to allow us to continue operations for the next twelve months. This includes minimum liquidity requirements of the Loan and Security Agreement, entered into on June 28, 2013 (as amended, the "Loan Agreement"), with Oxford Finance LLC and Silicon Valley Bank (the "Lenders") which requires the Company to make principal and interest payments of $1.0 million per month beginning in April 2015 and to maintain at least three months of cash on hand to avoid an event of default under the Loan Agreement. Our financing plans include pursuing additional cash through strategic corporate partnerships and future sales of equity, as well as our gross profits. While we have an established history of raising capital through these platforms, and we are currently involved in negotiations with multiple parties, there is no guarantee that adequate funds will be available when needed from additional debt or equity financing, development and commercialization partnerships, increased results of operations, or from other sources, or on terms acceptable to us. If our efforts to obtain sufficient additional funds are not successful, we would be required to delay, scale back, or eliminate some or all of our research or product development, manufacturing operations, administrative operations, including our employee base, and clinical or regulatory activities, which could negatively affect our ability to achieve certain corporate goals. | ||
The Company continues to seek additional capital through product revenues, strategic transactions, including extension opportunities under the awarded U.S. Department of Health and Human Service's Biomedical Advanced Research and Development Authority ("BARDA") contract, and from other financing alternatives. |
Transactions_with_Olympus_Corp
Transactions with Olympus Corporation | 9 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Transactions with Olympus Corporation [Abstract] | ' | ||||||||
Transactions with Olympus Corporation | ' | ||||||||
4 | Transactions with Olympus Corporation | ||||||||
In 2005, we entered into a joint venture and other related agreements (the “Joint Venture Agreements”) with Olympus. The Joint Venture was owned equally by Olympus and us. We had previously accounted for our interests in the Joint Venture using the equity method of accounting, since we could not exert significant influence over the Joint Venture’s operations. | |||||||||
On May 8, 2013, Cytori and Olympus agreed to terminate the Olympus-Cytori Joint Venture (The “Termination Agreement”), and Cytori acquired the remaining 50% equity interest in the Joint Venture from Olympus. The termination of the relationship and purchase of Olympus’ equity shares of the Joint Venture allows Cytori to regain full control of the manufacturing rights for the Celution ® system. The purpose of the acquisition is to gain more flexibility on the manufacturing process and associated costs, enable higher margins, and speed the transition to the critical next-generation systems. In connection with the Termination Agreement, the assets acquired, liabilities assumed, and the Company’s previously held equity interest were recorded at fair value. For valuation purposes Cytori determined the acquisition date (the date on which Cytori effectively gained full control of the equity interest previously held by Olympus) to be May 27, 2013. The remeasurement of the previously held equity interest at the acquisition date resulted in a net gain of $4,892,000 that was recorded in the accompanying Consolidated Condensed Statements of Operations. | |||||||||
As consideration for the Termination Agreement, Cytori can choose from alternative payment options as defined in the Termination Agreement. The payment options call for a minimum of $4,500,000 up to a maximum of $16,000,000 to be paid by Cytori to Olympus in installments over periods ranging from one year to six years depending on the option selected by the Company. Installment payments will be calculated quarterly based on 5% of Cytori’s gross sales receipts for all products sold. If Cytori received an aggregate $35,000,000 in cash through strategic or financing arrangements during the first year of the Termination Agreement, Cytori would have paid $4,500,000 upon request of Olympus as full and complete consideration under the Agreement. | |||||||||
The fair value of the Joint Venture, including the identified intangible assets acquired, consideration transferred, and Cytori’s previously held equity interest, was estimated from a market participant perspective, using valuation techniques based on the income approach for measuring fair value. Specifically, an excess earnings methodology was employed using primarily Level 3 fair value inputs. The intangible assets acquired consisted primarily of contractual license rights that had previously enabled the Joint Venture to conduct development and manufacturing activities pertaining to certain aspects of Cytori’s Celution ® technology. The useful life of the identifiable intangible assets was estimated based on the assumed future economic benefit expected to be received from the assets. Inputs used in the valuation included various market participant assumptions in order to project potential future cash flows, discounted at a rate commensurate with the risk involved. | |||||||||
Useful Life | Estimated | ||||||||
(in years) | Fair Value | ||||||||
Intangible assets: | |||||||||
Developed technology | 7 | $ | 9,394,000 | ||||||
The following table summarizes the fair value of the assets acquired and liabilities assumed at the date of acquisition (in thousands): | |||||||||
Estimated | |||||||||
Fair Value | |||||||||
Current assets | $ | 236 | |||||||
Property and equipment | 260 | ||||||||
Intangible assets | 9,394 | ||||||||
Total assets acquired | 9,890 | ||||||||
Accrued and other current liabilities | (33 | ) | |||||||
Total fair value of the Joint Venture | $ | 9,857 | |||||||
Acquisition-related transaction costs are not included as components of consideration transferred but have been accounted for as expenses in the period in which the costs are incurred. | |||||||||
Revenues and earnings from the Joint Venture were limited to royalties from sales of certain Cytori products, therefore, subsequent to the date of acquisition there was no revenue or earnings from the Joint Venture included in our consolidated results. Had the acquisition occurred on January 1, 2013, consolidated revenue would not have been affected, but our consolidated net loss would have been reduced by $48,000, the amount of our year-to-date equity loss from investment in Joint Venture. | |||||||||
The Company calculated the fair value of the purchase consideration on the acquisition date to be $4,928,000. This was determined using a weighted probability assessment of the payment options available to Cytori. Present value risk-adjusted discount rates applied to the purchase consideration ranged from 9.75% to 12.75%. The fair value calculation of the purchase consideration resulted in a discount of $1,072,000, which will be amortized to interest expense over a weighted average expected term of 1.8 years. On a quarterly basis, the Company will reassess the probabilities of the various payment options and expected term. Changes in the expected term and the remaining discount amount as a result of the reassessment will be recognized prospectively as an adjustment to interest expense. Upon final settlement of the purchase obligation, any difference between the amount paid and the carrying amount of the purchase obligation will be recorded as a gain or loss on extinguishment of the liability. As a result of this reassessment as of March 31, 2014 the Company believed it would settle the obligation for a total of $4.5 million (less any installment payments already made), which would have resulted in a gain of $0.6 million upon settlement. | |||||||||
As of May 8, 2014, the Company’s obligation to Olympus had not been settled, and accordingly, the obligation increased by $1.5 million under an alternative payment option. This option calls for $6.0 million in total payments to be made by May 8, 2015. Since we have made payments totaling $2.7 million through September 30, 2014 our remaining payment obligation under this option is now $3.3 million. | |||||||||
As a result of our quarterly reassessment, we have recorded additional interest expense of $217,000 and $362,000 during the three and nine months ended September 30, 2014, respectively, and have a remaining unrecognized future discount amount of approximately $506,000 as of September 30, 2014. | |||||||||
Partnership_Agreement_with_Lor
Partnership Agreement with Lorem Vascular | 9 Months Ended | |
Sep. 30, 2014 | ||
Partnership Agreement with Lorem Vascular [Abstract] | ' | |
Partnership Agreement with Lorem Vascular | ' | |
5 | Partnership Agreement with Lorem Vascular | |
On October 29, 2013, we entered into a partnership with Lorem Vascular Pty. Ltd (“Lorem Vascular”), to commercialize Cytori Cell Therapy for the cardiovascular, renal and diabetes markets, in China, Hong Kong, Malaysia, Singapore and Australia (the “License/Supply Agreement”), and a Common Stock Purchase Agreement. On January 30, 2014 we entered into the Amended and Restated License/Supply Agreement with Lorem Vascular (the “Restated Agreement”) which restated the License/Supply Agreement in its entirety and expanded the licensed field to all uses excepting alopecia (hair loss). Under the Restated Agreement, Lorem Vascular committed to pay up to $500 million in license fees in the form of revenue milestones. In addition, Lorem is required to pay us 30% of their gross profits in China, Hong Kong and Malaysia for the term of the agreement. In addition, Lorem Vascular has agreed to purchase the Cytori Celution® System and consumables under the Restated Agreement. Pursuant to the related Common Stock Purchase Agreement, Cytori sold Lorem Vascular 8 million shares of Cytori common stock at $3.00 per share for a total of $24 million. The Equity purchased was closed in two installments, the first half in November 2013, and the second half in January 2014. | ||
In addition, Lorem Vascular had initially committed to purchase approximately $7 million in Celution® devices and consumables, with an approximately $2 million order already completed in 2013, and an approximately $5 million order to be placed following regulatory approval in China. Lorem and Cytori have implemented a regulatory plan for China and anticipate approval in 2014. |
Longterm_Debt
Long-term Debt | 9 Months Ended | |
Sep. 30, 2014 | ||
Long-term Debt [Abstract] | ' | |
Long-term Debt | ' | |
6 | Long-term Debt | |
On June 28, 2013 we entered into the Loan Agreement with the Lenders, pursuant to which the Lenders funded an aggregate principal amount of $27.0 million (Term Loans), subject to the terms and conditions set forth in the loan agreement. The Term Loans accrue interest at a fixed rate of 9.75% per annum. Pursuant to the Loan Agreement, we are required to make interest only payments through July 1, 2014 and thereafter we are required to make payments of principal and accrued interest in equal monthly installments sufficient to amortize the Term Loans through July 1, 2017, the maturity date. All unpaid principal and interest with respect to the Term Loans is due and payable in full on July 1, 2017. At maturity of the Term Loans, or earlier repayment in full following voluntary prepayment or upon acceleration, the Company is required to make a final payment fee in an aggregate amount equal to $1,620,000. In connection with the Term Loans, on June 28, 2013, we issued to the Lenders warrants to purchase up to an aggregate of 596,553 shares of our common stock at an exercise price of $2.26 per share. These warrants are immediately exercisable and will expire on June 28, 2020. | ||
In connection with the funding of the Loan Agreement, we prepaid all outstanding amounts under the prior loan agreement, at which time the Company’s obligations under the prior loan agreement immediately terminated. The Company paid to the prior agent and the prior lenders approximately $18,866,000, consisting of the then outstanding principal balance due of approximately $17,325,000, accrued but unpaid interest of approximately $119,000, a final payment fee (net of fees waived or refunded by the Lenders under the new loan agreement) of approximately $1,078,000, a prepayment fee (net of fees waived or refunded by the Lenders under the new loan agreement) of approximately $312,000 and other customary lender fees and expenses. | ||
The net proceeds of the Term Loan, after payment of lender fees and expenses and prepaying all the outstanding amounts relating to the prior loan agreement, were approximately $7.8 million. | ||
For the continuing Lenders, we accounted for this amendment as a debt modification. Accordingly, related fees of $1,942,000 were recorded as debt discount, and along with the unamortized debt discount will be amortized as an adjustment of interest expense using the effective interest method. For one existing lender that did not participate in the Term Loan, the payoff of their loan was accounted for as debt extinguishment. Accordingly, a loss on debt extinguishment of $708,000 was recorded, which includes that lender’s portion of unamortized fees and discounts along with prepayment and final payment fees. | ||
We allocated the aggregate proceeds of the Term Loan between the warrants and the debt obligations based on their relative fair values. The fair value of the warrants issued to the Lenders was calculated utilizing the Black-Scholes option pricing model. We are amortizing the resulting additional discount of $949,000 to interest expense over the term of the loan using the effective interest method. The overall effective interest rate for the Term Loan is 13.92%. The Term Loan is collateralized by the tangible assets of the company, including a security interest in substantially all of its existing and after-acquired assets. | ||
On September 19, 2014, we entered into a Letter Agreement with the Lenders waiving financial covenant compliance pursuant to the Loan Agreement through October 31, 2014. The Loan Agreement requires the Company to maintain certain minimum cash balances at all times during the term of the Loan Agreement. In exchange for the above waiver, the Company agreed to re-price all 596,553 outstanding warrants issued by the Company to Oxford Finance LLC and Silicon Valley Bank pursuant to the Loan Agreement, with an exercise price per share equal to the lower of (i) the closing price per share of the Company's common stock on September 30, 2014, or (ii) the average closing price per share of the Company's common stock for October 1, 2 and 3, 2014. Following the authoritative accounting guidance, warrants with variable exercise price features are accounted for as liabilities, with changes in the fair value included in operating expenses. The Company estimated the fair value of the warrants immediately before and after modification using an option pricing model to reclassify its fair value from additional paid-in capital to warrant liability and re-measured the warrant liability at September 30, 2014 with the change in fair value of $134,000 accounted for as operating expenses. | ||
The following key assumptions were used by the Company to estimate the fair value of the warrant liability. Expected volatility was based primarily on historical volatility. Historical volatility was computed using daily pricing observations for recent periods that corresponded to the expected term of the warrants. We believe this method produced an estimate that was representative of our expectations of future volatility over the expected term of these warrants. The expected life was based on the remaining contractual term of the warrants. The risk-free interest rate was the interest rate for treasury constant maturity instruments published by the Federal Reserve Board that was closest to the expected term of the warrants. | ||
On September 29, 2014 we entered into a 2nd Amendment to the Loan Agreement with the Lenders in which we were provided a conditional waiver of principal payments subject to meeting certain capital raise requirements, which we achieved in October. The waiver of principal payments continues through April 1, 2015 and we are then required to make payments of principal and accrued interest in equal monthly installments sufficient to amortize the Term Loans through the maturity date. | ||
Revenue_Recognition
Revenue Recognition | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Revenue Recognition [Abstract] | ' | ||||||||||||||||
Revenue Recognition | ' | ||||||||||||||||
7 | Revenue Recognition | ||||||||||||||||
Product Sales | |||||||||||||||||
We recognize revenue from product sales when the following fundamental criteria are met: (i) persuasive evidence of an arrangement exists, (ii) delivery has occurred, (iii) the price to the customer is fixed or determinable and (iv) collection of the resulting accounts receivable is reasonably assured. For customers that have not developed a sufficient payment history with us or for whom a letter of credit is not in place at the time of the transaction, we defer revenues until collectability is reasonably assured. | |||||||||||||||||
For all sales, we use a binding purchase order or a signed agreement as evidence of an arrangement. Revenue for these product sales is recognized upon delivery to the customer, as all risks and rewards of ownership have been substantively transferred to the customer at that point. For sales to customers who arrange for and manage the shipping process, we recognize revenue upon shipment from our facilities. Shipping and handling costs that are billed to our customers are classified as revenue. The customer’s obligation to pay and the payment terms are set at the time of delivery and are not dependent on the subsequent use or resale of our products. For sales where all revenue recognition criteria are not met, revenue is deferred and related inventory remains on our books. | |||||||||||||||||
For sales that include multiple deliverables, such as sales of our StemSource® Cell Bank (cell bank), we account for products or services (deliverables) separately rather than as a combined unit. Stem cell banks typically consist of a complex array of equipment, proprietary knowledge, license rights, and services, including one or more StemSource® devices, a cryogenic freezer, measuring and monitoring equipment, and a database patient tracking system. In addition, we typically provide consulting, installation, and training services. Web hosting, technical support and maintenance services are generally provided for a period of up to one year subsequent to the date of sale. FASB authoritative guidance requires an evaluation of these deliverables to determine the appropriate “units of accounting” for purposes of revenue recognition. Each cell bank is customized to provide the best solution for the customer. Depending on customers’ needs, all or a combination of the following units of accounting will apply to cell bank transactions: | |||||||||||||||||
· | initial consulting services; | ||||||||||||||||
· | license rights and standard operating procedures; | ||||||||||||||||
· | equipment and supplies; | ||||||||||||||||
· | installation services; | ||||||||||||||||
· | training services; | ||||||||||||||||
· | database hosting services; | ||||||||||||||||
· | technical support services; and | ||||||||||||||||
· | maintenance services. | ||||||||||||||||
FASB authoritative guidance establishes a selling price hierarchy for determining the selling price of a deliverable, which is based on: (a) vendor-specific objective evidence (“VSOE”); (b) third-party evidence (“TPE”); or (c) management estimates. This guidance requires arrangement consideration to be allocated at the inception of the arrangement to all deliverables using the relative selling price method. For our cell bank sales, we establish relative selling prices for all deliverables based on vendor-specific quotes for comparable services when available. In the absence of VSOE, we use competitors’ products or services considered largely interchangeable with our own or management’s best estimate. Revenue allocated to each unit of accounting is calculated and recognized based on the relative selling price of each deliverable. Future services such as web hosting and ongoing maintenance are deferred and recognized into income as the services are provided, generally over one year following the installation of the equipment. | |||||||||||||||||
Concentration of Significant Customers | |||||||||||||||||
Five distributors comprised 62% of our revenue recognized for the nine months ended September 30, 2014. One direct customer and two distributors accounted for 84% of total outstanding accounts receivable as of September 30, 2014. | |||||||||||||||||
Three direct customers comprised 39% of our revenue recognized for the nine months ended September 30, 2013. Three direct customers accounted for 54% of total outstanding accounts receivable as of September 30, 2013. | |||||||||||||||||
Product revenues, classified by geographic location, are as follows: | |||||||||||||||||
Nine months ended | |||||||||||||||||
30-Sep-14 | 30-Sep-13 | ||||||||||||||||
Product Revenues | % of Total | Product Revenues | % of Total | ||||||||||||||
North America | $ | 614,000 | 25 | % | $ | 822,000 | 19 | % | |||||||||
Japan | 1,323,000 | 53 | % | 1,892,000 | 43 | % | |||||||||||
Europe | 427,000 | 17 | % | 865,000 | 19 | % | |||||||||||
Other countries | 120,000 | 5 | % | 837,000 | 19 | % | |||||||||||
Total product revenues | $ | 2,484,000 | 100 | % | $ | 4,416,000 | 100 | % | |||||||||
Research and Development | |||||||||||||||||
We earn revenue for performing tasks under research and development agreements with both commercial enterprises, such as Olympus and Senko, and governmental agencies like the BARDA. Revenue earned under development agreements with commercial enterprises is classified as development revenues. Revenues derived from reimbursement of direct out-of-pocket expenses for research costs associated with government contracts are recorded as government contract and other within development revenues. Government contract revenue is recorded at the gross amount of the reimbursement. The costs associated with these reimbursements are reflected as a component of research and development expense in our statements of operations. | |||||||||||||||||
In the third quarter of 2012, we were awarded a contract to develop a new countermeasure for thermal burns valued at up to $106 million with BARDA. The initial base period includes $4.7 million over two years and covers preclinical research and continued development of Cytori's Celution® system to improve cell processing. The additional contract options, if fully executed, cover clinical development through FDA approval under a device-based PMA regulatory pathway. In August 2014, BARDA exercised Option 1 of the contract for Cytori to perform research, development, regulatory, clinical and other tasks required for initiation of a pilot clinical trial of the Celution System in thermal burn injury for a total cost-plus fixed fee of up to $12.1 million, amendments to the Statement of Work, and reorganization of the contract options. This is a cost reimbursement contract and related government contract revenue was recorded at the gross amount of reimbursement starting in the fourth quarter of 2012. | |||||||||||||||||
We received funds from Olympus and Olympus-Cytori, Inc. during 2005 and 2006. We recorded upfront fees totaling $28,311,000 as deferred revenues, related party. In exchange for these proceeds, we agreed to (a) provide Olympus-Cytori, Inc. an exclusive and perpetual license to our Celution® System device technology and certain related intellectual property, and (b) provide future development contributions related to commercializing the Celution® System platform. The license and development services were not separable and as a result the recognition of this deferred amount as revenue required achievement of service related milestones, under a proportional performance methodology. Revenue was recognized as the above mentioned R&D milestones were completed. Of the amounts received and deferred, we recognized the last remaining development revenue of $638,000 during the three months ended March 31, 2013 as a result of the United States Court of Appeals upholding the FDA’s previous determination that our cell processing devices were not substantially equivalent to the cited predicate devices. The recognition of revenue associated with this event reflects the completion of our efforts expended to use commercially reasonable efforts to obtain device regulatory approvals in the United States as it pertains to the 510(k) pathway. As of September 30, 2014, there are no deferred amounts under this contract. | |||||||||||||||||
Refer to note 14 for discussion about our arrangement with Senko. |
Inventories
Inventories | 9 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Inventories [Abstract] | ' | ||||||||
Inventories | ' | ||||||||
8 | Inventories | ||||||||
Inventories are carried at the lower of cost or market, determined on the first-in, first-out (FIFO) method. | |||||||||
Inventories consisted of the following: | |||||||||
September 30, | December 31, | ||||||||
2014 | 2013 | ||||||||
Raw materials | $ | 1,506,000 | $ | 1,315,000 | |||||
Work in process | 917,000 | 232,000 | |||||||
Finished goods | 2,597,000 | 2,147,000 | |||||||
$ | 5,020,000 | $ | 3,694,000 |
Equity_Incentive_Plan
Equity Incentive Plan | 9 Months Ended | |
Sep. 30, 2014 | ||
Equity Incentive Plan [Abstract] | ' | |
Share-Based Compensation | ' | |
9 | Equity Incentive Plan | |
During the third quarter of 2014, we adopted the 2014 Equity Incentive Plan (the "2014 Plan"), which provides our employees, directors and consultants the opportunity to purchase our common stock in the form of options, stock appreciation rights, restricted stock purchase rights, restricted stock bonuses, restricted stock units, performance shares, performance units, cash-based awards other stock-based awards, and deferred compensation awards. The 2014 Plan initially provides for issuance of 3,975,000 shares of our common stock. As of September 30, 2014, there are 3,717,500 securities remaining and available for future issuances under the 2014 Plan, which is exclusive of securities to be issued upon an exercise of outstanding options, warrants, and rights. |
Loss_per_Share
Loss per Share | 9 Months Ended | |
Sep. 30, 2014 | ||
Loss per Share [Abstract] | ' | |
Loss per Share | ' | |
10 | Loss per Share | |
Basic per share data is computed by dividing net income or loss applicable to common stockholders by the weighted average number of common shares outstanding during the period. Diluted per share data is computed by dividing net income or loss applicable to common stockholders by the weighted average number of common shares outstanding during the period increased to include, if dilutive, the number of additional common shares that would have been outstanding as calculated using the treasury stock method. Potential common shares were related entirely to outstanding but unexercised options and warrants for all periods presented. | ||
We have excluded all potentially dilutive securities, including unvested performance-based restricted stock, from the calculation of diluted loss per share attributable to common stockholders for the three and nine months ended September 30, 2014 and 2013, as their inclusion would be antidilutive. Potentially dilutive common shares excluded from the calculations of diluted loss per share were 18,748,777 for the three and nine month periods ended September 30, 2014 and 17,212,805 for the three and nine month periods ended September 30, 2013. |
Accumulated_Other_Comprehensiv
Accumulated Other Comprehensive Loss | 9 Months Ended | |
Sep. 30, 2014 | ||
Accumulated Other Comprehensive Loss [Abstract] | ' | |
Accumulated Other Comprehensive Loss | ' | |
11 | Accumulated Other Comprehensive Loss | |
During the first quarter of 2013, we determined that the functional currency of our Japanese subsidiary changed from the US Dollar to the Japanese Yen due to significant changes in economic facts and circumstances of our Japan subsidiary. As a result of this change, a portion of the foreign exchange gain or loss will be classified as foreign currency translation adjustments within other comprehensive income or loss. Our comprehensive loss includes net loss and foreign currency translation adjustments. See the unaudited Consolidated Condensed Statements of Operations and Comprehensive Loss for the effect of foreign currency translation adjustments. |
Commitments_and_Contingencies
Commitments and Contingencies | 9 Months Ended | |
Sep. 30, 2014 | ||
Commitments and Contingencies [Abstract] | ' | |
Commitments and Contingencies | ' | |
12 | Commitments and Contingencies | |
We have entered into agreements with various research organizations for pre-clinical and clinical development studies, which have provisions for cancellation. Under the terms of these agreements, the vendors provide a variety of services including conducting research, recruiting and enrolling patients, monitoring studies and data analysis. Payments under these agreements typically include fees for services and reimbursement of expenses. The timing of payments due under these agreements is estimated based on current study in progress. As of September 30, 2014, we have clinical research study obligations of $6,358,000 ($4,785,000 of which are expected to be complete within a year). Should the timing of the clinical trials change, the timing of the payment of these obligations would also change. | ||
We have entered into several lease agreements for our headquarters office location as well as international office locations. As of September 30, 2014, we have remaining lease obligations of $6,919,000 ($2,197,000 of which are expected to be completed within a year). | ||
We are subject to various claims and contingencies related to legal proceedings. Due to their nature, such legal proceedings involve inherent uncertainties including, but not limited to, court rulings, negotiations between affected parties and governmental actions. Management assesses the probability of loss for such contingencies and accrues a liability and/or discloses the relevant circumstances, as appropriate. Management believes that any liability to us that may arise as a result of currently pending legal proceedings will not have a material adverse effect on our financial condition, liquidity, or results of operations as a whole. | ||
Refer to note 6 for a discussion of our commitments and contingencies related to our long-term obligations. | ||
Refer to note 4 for a discussion of our commitments and contingencies related to our transactions with Olympus. | ||
Refer to note 14 for a discussion of our commitments and contingencies related to our arrangements with Senko. |
Sale_and_Exclusive_LicenseSupp
Sale and Exclusive License/Supply Agreement with Bimini Technologies LLC | 9 Months Ended | |
Sep. 30, 2014 | ||
Sale and Exclusive License/Supply Agreement with Bimini Technologies LLC [Abstract] | ' | |
Sale and Exclusive License/Supply Agreement with Bimini Technologies LLC | ' | |
13 | Sale and Exclusive License/Supply Agreement with Bimini Technologies LLC | |
On July 30, 2013, we entered into a Sale and Exclusive License/Supply Agreement with Bimini Technologies LLC (“Bimini”), pursuant to which we sold to Bimini substantially all of the assets (other than certain retained rights and licenses) of our Puregraft® product line, a series of standalone fat transplantation products that were developed to improve the predictability of outcomes for autologous fat grafting and aesthetic body contouring. The aggregate value of the consideration paid by Bimini at the execution of the agreement was $5.0 million. | ||
In connection with the sale, Bimini granted to the Company an exclusive, perpetual, royalty bearing license to market and sell the Puregraft products for use in combination with adipose derived regenerative cells, and non-exclusive rights for use in connection with the Company’s licensed cell and tissue banks. The Company will supply Puregraft products to Bimini on an interim basis until the Company transfers the manufacturing of the Puregraft products to Bimini. After the transfer, Bimini will supply the Puregraft products to the Company. | ||
Pursuant to the sale agreement, the Company has also granted to Bimini the global, exclusive, perpetual, irrevocable royalty bearing license to purchase from Cytori, use and sell the Celution® System products for Alopecia (hair loss). Cytori will supply Celution devices and consumable sets to Bimini, and Bimini will be responsible for all costs associated with commercial development in the Alopecia market. | ||
The agreement includes certain obligations to be performed by the Company on the behalf of Bimini, which includes transferring the manufacturing of Puregraft products to an agreed upon third party on or before December 31, 2014 and training. The Company recorded a gain on the Puregraft divestiture of $4.5 million in 2013, and has a remaining obligation of approximately $158,000 in future transfer and training obligations, as of September 30, 2014. Bimini is obligated to make certain additional milestone payments to the Company (in an aggregate amount of up to $10.0 million), contingent upon the achievement of certain milestones relating to Bimini’s gross profits from sales of the Puregraft products. |
Thin_Film_Japan_Distribution_A
Thin Film Japan Distribution Agreement | 9 Months Ended | |
Sep. 30, 2014 | ||
Thin Film Japan Distribution Agreement [Abstract] | ' | |
Thin Film Japan Distribution Agreement | ' | |
14 | Thin Film Japan Distribution Agreement | |
In 2004, the Company entered into a Distribution Agreement with Senko. Under this agreement, we granted to Senko an exclusive license to sell and distribute certain Thin Film products in Japan and are responsible for the completion of the initial regulatory application to the Ministry of Health, Labor and Welfare (MHLW) and commercialization of the Thin Film product line in Japan. The Distribution Agreement with Senko was to commence upon “commercialization.” Essentially, commercialization occurs when one or more Thin Film product registrations are completed with the MHLW. At the inception of this arrangement, we received a $1,500,000 license fee which was recorded as deferred revenues in 2004. Half of the license fee was refundable if the parties agree commercialization is not achievable and a proportional amount was refundable if we terminate the arrangement, other than for material breach by Senko, before three years post-commercialization. We have also received $1,250,000 in milestone payments from Senko. | ||
In February 2013, we entered into a mutual termination and release agreement with Senko, whereby the Distribution Agreement and all Senko rights, licenses and privileges granted under the Distribution Agreement terminated and reverted to the Company. As a result of this Termination Agreement, we were obligated to pay Senko $1,200,000 in six quarterly installment payments of $200,000 each through May 2014 (all of which has been paid). At the time of the Termination Agreement, we had a balance of $2,379,000 in deferred revenues on our balance sheet relating to the payments received from Senko in the past pursuant to the Distribution Agreement. At the time of the Termination Agreement we accrued $1,200,000 of the termination fee, and recognized the remaining $1,179,000 in development revenues which reflects the Company’s efforts towards commercialization under the agreement. As of September 30, 2014, we have no remaining termination fee obligation. |
Fair_Value_Measurements
Fair Value Measurements | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Fair Value Measurements [Abstract] | ' | ||||||||||||||||
Fair Value Measurements | ' | ||||||||||||||||
15 | Fair Value Measurements | ||||||||||||||||
Fair value measurements are market-based measurements, not entity-specific measurements. Therefore, fair value measurements are determined based on the assumptions that market participants would use in pricing the asset or liability. We follow a three-level hierarchy to prioritize the inputs used in the valuation techniques to derive fair values. The basis for fair value measurements for each level within the hierarchy is described below: | |||||||||||||||||
· Level 1: Quoted prices in active markets for identical assets or liabilities. | |||||||||||||||||
· Level 2: Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs are observable in active markets. | |||||||||||||||||
· Level 3: Valuations derived from valuation techniques in which one or more significant inputs are unobservable in active markets. | |||||||||||||||||
The following table provides a summary of the recognized assets and liabilities that we measure at fair value on a recurring basis: | |||||||||||||||||
Balance as of | Basis of Fair Value Measurements | ||||||||||||||||
30-Sep-14 | Level 1 | Level 2 | Level 3 | ||||||||||||||
Assets: | |||||||||||||||||
Cash equivalents | $ | 3,644,000 | $ | 3,644,000 | $ | — | $ | — | |||||||||
Liabilities: | |||||||||||||||||
Warrant liability | $ | 287,000 | $ | — | $ | — | $ | 287,000 | |||||||||
Balance as of | Basis of Fair Value Measurements | ||||||||||||||||
31-Dec-13 | Level 1 | Level 2 | Level 3 | ||||||||||||||
Assets: | |||||||||||||||||
Cash equivalents | $ | 4,644,000 | $ | 4,644,000 | $ | — | $ | — | |||||||||
We use quoted market prices to determine the fair value of our cash equivalents, which consist of money market funds that are classified in Level 1 of the fair value hierarchy. | |||||||||||||||||
Refer to note 6 for discussion about determining the fair value of our warrant liability. | |||||||||||||||||
Common stock purchase warrants issued in connection with our Letter Agreement with the Lenders do not trade in an active securities market, and as such, we estimated the fair value of these warrants using the option pricing model (see note 6). Some of the significant inputs are observable in active markets, such as common stock market price, volatility, and risk free rate. Because some of the inputs to our valuation model are either not observable quoted prices or are not derived principally from or corroborated by observable market data by correlation or other means, the warrant liability is classified as Level 3 in the fair value hierarchy. | |||||||||||||||||
The following table summarizes the change in our Level 3 warrant liability value: | |||||||||||||||||
Three months ended | Nine months ended | ||||||||||||||||
Warrant liability | 30-Sep-14 | 30-Sep-14 | |||||||||||||||
Beginning balance | $ | — | $ | — | |||||||||||||
Fair value of warrants allocated from additional paid in capital | 421,000 | 421,000 | |||||||||||||||
Decrease in fair value recognized in operating expenses | (134,000 | ) | (134,000 | ) | |||||||||||||
Ending balance | $ | 287,000 | $ | 287,000 |
Fair_Value
Fair Value | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Fair Value [Abstract] | ' | ||||||||||||||||
Fair Value | ' | ||||||||||||||||
16 | Fair Value | ||||||||||||||||
Financial Instruments | |||||||||||||||||
We disclose fair value information about all financial instruments, whether or not recognized in the balance sheet, for which it is practicable to estimate fair value. The disclosures of estimated fair value of financial instruments at September 30, 2014 and December 31, 2013, were determined using available market information and appropriate valuation methods. Considerable judgment is necessary to interpret market data and develop estimated fair value. The use of different market assumptions or estimation methods may have a material effect on the estimated fair value amounts. | |||||||||||||||||
The carrying amounts for cash and cash equivalents, accounts receivable, inventories, other current assets, accounts payable, accrued expenses and other liabilities approximate fair value due to the short-term nature of these instruments. | |||||||||||||||||
We utilize quoted market prices to estimate the fair value of our fixed rate debt, when available. If quoted market prices are not available, we calculate the fair value of our fixed rate debt based on a currently available market rate assuming the loans are outstanding through maturity and considering the collateral. In determining the current market rate for fixed rate debt, a market spread is added to the quoted yields on federal government treasury securities with similar terms to the debt. | |||||||||||||||||
At September 30, 2014 and December 31, 2013, the aggregate fair value and the carrying value of the Company’s fixed rate long-term debt were as follows: | |||||||||||||||||
30-Sep-14 | 31-Dec-13 | ||||||||||||||||
Fair Value | Carrying Value | Fair Value | Carrying Value | ||||||||||||||
Fixed rate long-term debt | $ | 25,328,000 | $ | 25,775,000 | $ | 26,207,000 | $ | 26,241,000 | |||||||||
Carrying value is net of debt discount of $1,631,000 and $2,379,000 as of September 30, 2014 and December 31, 2013, respectively. | |||||||||||||||||
The fair value of debt is classified as Level 3 in the fair value hierarchy as some of the inputs to our valuation model are either not observable quoted prices or are not derived principally from or corroborated by observable market data by correlation or other means. |
Stockholders_Equity
Stockholders' Equity | 9 Months Ended | |
Sep. 30, 2014 | ||
Stockholders' Equity [Abstract] | ' | |
Stockholders' Equity | ' | |
17 | Stockholders’ Equity | |
Common Stock | ||
In December 2012, we entered into an underwriting agreement with Lazard Capital Markets, LLC (underwriter), relating to the issuance and sale of 7,020,000 shares of our common stock. The price to the public in this offering was $2.85 per share and the underwriter purchased the shares from us at a price of $2.69 per share. The transaction was completed on December 19, 2012 raising approximately $20,007,000 in gross proceeds before deducting underwriting discounts and commissions and other offering expenses payable by us. Under the terms of the underwriting agreement, we granted the underwriter an option, exercisable for 30 days, to purchase up to an additional 1,053,000 shares. | ||
In January 2013, the underwriter exercised this option and as a result we sold an additional 1,053,000 shares raising approximately $3,001,000 in gross proceeds before deducting underwriting discounts and commissions and other offering expenses payable by us. | ||
In October 2013, we entered into a Common Stock Purchase Agreement with Lorem Vascular for the purchase of 8,000,000 shares at $3.00 per share. The transaction occurred in two separate closings of 4,000,000 shares each. The first closing occurred in November 2013, and the second closing occurred in January 2014. As of December 31, 2013, we received $15,000,000 of the gross proceeds, $12,000,000 for the first closing and $3,000,000 towards the second closing. The balance of $9,000,000 in gross proceeds required to complete the second closing was received in January 2014. | ||
In May 2014, we and 47 holders of warrants to purchase a total of 3,156,238 shares of the Company’s common stock, $0.001 par value per share, issued in a private offering in May 2009, agreed to extend the expiration date of the warrants from May 14, 2014 to May 14, 2015 and increase the exercise price of the warrants from $2.62 per share to $3.50 per share pursuant to an Amendment to Warrant to Purchase Common Stock. One holder of warrants did not agree to the Amendment, and their warrants, covering 38,500 shares of Common Stock, expired unexercised on May 14, 2014 in accordance with the original terms. | ||
In May 2014, we entered into subscription agreements with certain institutional investors pursuant to which we sold a total of 4,048,584 units, with each unit consisting of one share of common stock and one warrant to purchase one share of common stock at a purchase price of $2.47 per unit, in a registered direct offering. Each warrant will have an exercise price of $3.00 per share, will be exercisable immediately after issuance and will expire five years from the date of issuance. The transaction was completed on June 4, 2014 raising approximately $10,000,000 in gross proceeds before deducting any offering expenses or fees payable by us. Under the terms of our Placement Agent Agreement, we granted WBB Securities, LLC warrants to purchase 202,429 shares of common stock. The placement agent warrants will have the same terms as the warrants issued to the purchasers in the offering, except that such warrants will have an exercise price of $3.09. | ||
In September 2014, the Company and 13 holders of warrants dated June 4, 2014 to purchase a total of 4,032,389 shares of the Company's common stock, $0.001 par value per share, agreed to amend the warrants in order to reduce the exercise price from $3.00 per share to $1.00 per share and change the expiration date from June 4, 2019 to September 10, 2014 pursuant to an amendment to warrant to purchase common stock. The Company received proceeds of approximately $4,000,000 from exercise of the Warrants. In addition, pursuant to the terms of the amendment, upon each holder's exercise of all shares for cash prior to the amended expiration date, the Company issued a new warrant for the same number of shares to holder. The additional warrants have an exercise price of $2.00 per share, and are exercisable on the date that is six months and one day from the date of issuance and expire five years from the date of issuance. | ||
Related Party Transactions | ||
During the nine months ended September 30, 2013, we incurred approximately $46,000, in royalty costs in connection with our sales of our Celution® 800/CRS System products to the European and Asia-Pacific reconstructive surgery market, pursuant to our License and Royalty Agreement and the Amended License/Commercial Agreement with the Olympus-Cytori, Inc. joint venture. There were no comparable royalty costs during the nine months ended September 30, 2014. | ||
Additionally, refer to note 4 for a discussion of related party transactions with Olympus. |
Subsequent_Events
Subsequent Events | 9 Months Ended | |
Sep. 30, 2014 | ||
Subsequent Events [Abstract] | ' | |
Subsequent Events | ' | |
18 | Subsequent Events | |
On October 8, 2014, we entered into a Securities Purchase Agreement with certain institutional investors pursuant to which the Company sold a total of 13,500 units for a purchase price of $1,000 per unit, with each unit consisting of one share of the Company's Series A 3.6% convertible preferred stock, which are convertible into shares of the Company's common stock, par value of $0.001 per share, with a conversion price of $0.52, and warrants to purchase up to a number of shares of common stock equal to 100% of the conversion shares under the shares of preferred stock, in a registered direct offering. Each warrant has an exercise price of $0.5771 per share, is exercisable six months after the date of issuance and expires five years from the date on which it is initially exercisable. The preferred stock and the warrants were immediately separable and were issued separately. As of October 31, 2014, we have converted 4,615 units into 8,875,000 shares of common stock. | ||
Basis_of_Presentation_Policies
Basis of Presentation (Policies) | 9 Months Ended |
Sep. 30, 2014 | |
Basis of Presentation [Abstract] | ' |
Basis of Presentation | ' |
Basis of Presentation | |
Our accompanying unaudited consolidated condensed financial statements as of September 30, 2014 and for the three and nine months ended September 30, 2014 and 2013 have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for annual financial statements. Our consolidated condensed balance sheet at September 30, 2014 has been derived from the audited financial statements at December 31, 2013, but does not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation of the financial position and results of operations of Cytori Therapeutics, Inc., and our subsidiaries (the Company) have been included. Operating results for the three and nine months ended September 30, 2014 are not necessarily indicative of the results that may be expected for the year ending December 31, 2014. These financial statements should be read in conjunction with the Consolidated Financial Statements and notes therein included in our annual report on Form 10-K for the year ended December 31, 2013. |
Use_of_Estimates_Policies
Use of Estimates (Policies) | 9 Months Ended |
Sep. 30, 2014 | |
Use of Estimates [Abstract] | ' |
Use of Estimates | ' |
Use of Estimates | |
The preparation of Consolidated Condensed Financial Statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions affecting the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. Our most significant estimates and critical accounting policies involve recognizing revenue, valuing warrants, determining the assumptions used in measuring share-based compensation expense, measuring accretion expense related to our acquisition of the joint venture, and valuing allowances for doubtful accounts and inventories. | |
Actual results could differ from these estimates. Management’s estimates and assumptions are reviewed regularly, and the effects of revisions are reflected in the Consolidated Condensed Financial Statements in the periods they are determined to be necessary. |
Revenue_Recognition_Policies
Revenue Recognition (Policies) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Revenue Recognition [Abstract] | ' | ||||||||||||||||
Revenue Recognition | ' | ||||||||||||||||
7 | Revenue Recognition | ||||||||||||||||
Product Sales | |||||||||||||||||
We recognize revenue from product sales when the following fundamental criteria are met: (i) persuasive evidence of an arrangement exists, (ii) delivery has occurred, (iii) the price to the customer is fixed or determinable and (iv) collection of the resulting accounts receivable is reasonably assured. For customers that have not developed a sufficient payment history with us or for whom a letter of credit is not in place at the time of the transaction, we defer revenues until collectability is reasonably assured. | |||||||||||||||||
For all sales, we use a binding purchase order or a signed agreement as evidence of an arrangement. Revenue for these product sales is recognized upon delivery to the customer, as all risks and rewards of ownership have been substantively transferred to the customer at that point. For sales to customers who arrange for and manage the shipping process, we recognize revenue upon shipment from our facilities. Shipping and handling costs that are billed to our customers are classified as revenue. The customer’s obligation to pay and the payment terms are set at the time of delivery and are not dependent on the subsequent use or resale of our products. For sales where all revenue recognition criteria are not met, revenue is deferred and related inventory remains on our books. | |||||||||||||||||
For sales that include multiple deliverables, such as sales of our StemSource® Cell Bank (cell bank), we account for products or services (deliverables) separately rather than as a combined unit. Stem cell banks typically consist of a complex array of equipment, proprietary knowledge, license rights, and services, including one or more StemSource® devices, a cryogenic freezer, measuring and monitoring equipment, and a database patient tracking system. In addition, we typically provide consulting, installation, and training services. Web hosting, technical support and maintenance services are generally provided for a period of up to one year subsequent to the date of sale. FASB authoritative guidance requires an evaluation of these deliverables to determine the appropriate “units of accounting” for purposes of revenue recognition. Each cell bank is customized to provide the best solution for the customer. Depending on customers’ needs, all or a combination of the following units of accounting will apply to cell bank transactions: | |||||||||||||||||
· | initial consulting services; | ||||||||||||||||
· | license rights and standard operating procedures; | ||||||||||||||||
· | equipment and supplies; | ||||||||||||||||
· | installation services; | ||||||||||||||||
· | training services; | ||||||||||||||||
· | database hosting services; | ||||||||||||||||
· | technical support services; and | ||||||||||||||||
· | maintenance services. | ||||||||||||||||
FASB authoritative guidance establishes a selling price hierarchy for determining the selling price of a deliverable, which is based on: (a) vendor-specific objective evidence (“VSOE”); (b) third-party evidence (“TPE”); or (c) management estimates. This guidance requires arrangement consideration to be allocated at the inception of the arrangement to all deliverables using the relative selling price method. For our cell bank sales, we establish relative selling prices for all deliverables based on vendor-specific quotes for comparable services when available. In the absence of VSOE, we use competitors’ products or services considered largely interchangeable with our own or management’s best estimate. Revenue allocated to each unit of accounting is calculated and recognized based on the relative selling price of each deliverable. Future services such as web hosting and ongoing maintenance are deferred and recognized into income as the services are provided, generally over one year following the installation of the equipment. | |||||||||||||||||
Concentration of Significant Customers | |||||||||||||||||
Five distributors comprised 62% of our revenue recognized for the nine months ended September 30, 2014. One direct customer and two distributors accounted for 84% of total outstanding accounts receivable as of September 30, 2014. | |||||||||||||||||
Three direct customers comprised 39% of our revenue recognized for the nine months ended September 30, 2013. Three direct customers accounted for 54% of total outstanding accounts receivable as of September 30, 2013. | |||||||||||||||||
Product revenues, classified by geographic location, are as follows: | |||||||||||||||||
Nine months ended | |||||||||||||||||
30-Sep-14 | 30-Sep-13 | ||||||||||||||||
Product Revenues | % of Total | Product Revenues | % of Total | ||||||||||||||
North America | $ | 614,000 | 25 | % | $ | 822,000 | 19 | % | |||||||||
Japan | 1,323,000 | 53 | % | 1,892,000 | 43 | % | |||||||||||
Europe | 427,000 | 17 | % | 865,000 | 19 | % | |||||||||||
Other countries | 120,000 | 5 | % | 837,000 | 19 | % | |||||||||||
Total product revenues | $ | 2,484,000 | 100 | % | $ | 4,416,000 | 100 | % | |||||||||
Research and Development | |||||||||||||||||
We earn revenue for performing tasks under research and development agreements with both commercial enterprises, such as Olympus and Senko, and governmental agencies like the BARDA. Revenue earned under development agreements with commercial enterprises is classified as development revenues. Revenues derived from reimbursement of direct out-of-pocket expenses for research costs associated with government contracts are recorded as government contract and other within development revenues. Government contract revenue is recorded at the gross amount of the reimbursement. The costs associated with these reimbursements are reflected as a component of research and development expense in our statements of operations. | |||||||||||||||||
In the third quarter of 2012, we were awarded a contract to develop a new countermeasure for thermal burns valued at up to $106 million with BARDA. The initial base period includes $4.7 million over two years and covers preclinical research and continued development of Cytori's Celution® system to improve cell processing. The additional contract options, if fully executed, cover clinical development through FDA approval under a device-based PMA regulatory pathway. In August 2014, BARDA exercised Option 1 of the contract for Cytori to perform research, development, regulatory, clinical and other tasks required for initiation of a pilot clinical trial of the Celution System in thermal burn injury for a total cost-plus fixed fee of up to $12.1 million, amendments to the Statement of Work, and reorganization of the contract options. This is a cost reimbursement contract and related government contract revenue was recorded at the gross amount of reimbursement starting in the fourth quarter of 2012. | |||||||||||||||||
We received funds from Olympus and Olympus-Cytori, Inc. during 2005 and 2006. We recorded upfront fees totaling $28,311,000 as deferred revenues, related party. In exchange for these proceeds, we agreed to (a) provide Olympus-Cytori, Inc. an exclusive and perpetual license to our Celution® System device technology and certain related intellectual property, and (b) provide future development contributions related to commercializing the Celution® System platform. The license and development services were not separable and as a result the recognition of this deferred amount as revenue required achievement of service related milestones, under a proportional performance methodology. Revenue was recognized as the above mentioned R&D milestones were completed. Of the amounts received and deferred, we recognized the last remaining development revenue of $638,000 during the three months ended March 31, 2013 as a result of the United States Court of Appeals upholding the FDA’s previous determination that our cell processing devices were not substantially equivalent to the cited predicate devices. The recognition of revenue associated with this event reflects the completion of our efforts expended to use commercially reasonable efforts to obtain device regulatory approvals in the United States as it pertains to the 510(k) pathway. As of September 30, 2014, there are no deferred amounts under this contract. | |||||||||||||||||
Refer to note 14 for discussion about our arrangement with Senko. |
Transactions_with_Olympus_Corp1
Transactions with Olympus Corporation (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Transactions with Olympus Corporation [Abstract] | ' | ||||||||
Schedule of Acquired Intangible Assets | ' | ||||||||
Inputs used in the valuation included various market participant assumptions in order to project potential future cash flows, discounted at a rate commensurate with the risk involved. | |||||||||
Useful Life | Estimated | ||||||||
(in years) | Fair Value | ||||||||
Intangible assets: | |||||||||
Developed technology | 7 | $ | 9,394,000 | ||||||
Schedule of Assets Acquired and Liabilities Assumed | ' | ||||||||
The following table summarizes the fair value of the assets acquired and liabilities assumed at the date of acquisition (in thousands): | |||||||||
Estimated | |||||||||
Fair Value | |||||||||
Current assets | $ | 236 | |||||||
Property and equipment | 260 | ||||||||
Intangible assets | 9,394 | ||||||||
Total assets acquired | 9,890 | ||||||||
Accrued and other current liabilities | (33 | ) | |||||||
Total fair value of the Joint Venture | $ | 9,857 |
Revenue_Recognition_Tables
Revenue Recognition (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Revenue Recognition [Abstract] | ' | ||||||||||||||||
Product Revenues by Geographic Location | ' | ||||||||||||||||
Product revenues, classified by geographic location, are as follows: | |||||||||||||||||
Nine months ended | |||||||||||||||||
30-Sep-14 | 30-Sep-13 | ||||||||||||||||
Product Revenues | % of Total | Product Revenues | % of Total | ||||||||||||||
North America | $ | 614,000 | 25 | % | $ | 822,000 | 19 | % | |||||||||
Japan | 1,323,000 | 53 | % | 1,892,000 | 43 | % | |||||||||||
Europe | 427,000 | 17 | % | 865,000 | 19 | % | |||||||||||
Other countries | 120,000 | 5 | % | 837,000 | 19 | % | |||||||||||
Total product revenues | $ | 2,484,000 | 100 | % | $ | 4,416,000 | 100 | % |
Inventories_Tables
Inventories (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Inventories [Abstract] | ' | ||||||||
Inventory | ' | ||||||||
Inventories consisted of the following: | |||||||||
September 30, | December 31, | ||||||||
2014 | 2013 | ||||||||
Raw materials | $ | 1,506,000 | $ | 1,315,000 | |||||
Work in process | 917,000 | 232,000 | |||||||
Finished goods | 2,597,000 | 2,147,000 | |||||||
$ | 5,020,000 | $ | 3,694,000 |
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Fair Value Measurements [Abstract] | ' | ||||||||||||||||
Assets and Liabilities Measured at Fair Value | ' | ||||||||||||||||
The following table provides a summary of the recognized assets and liabilities that we measure at fair value on a recurring basis: | |||||||||||||||||
Balance as of | Basis of Fair Value Measurements | ||||||||||||||||
30-Sep-14 | Level 1 | Level 2 | Level 3 | ||||||||||||||
Assets: | |||||||||||||||||
Cash equivalents | $ | 3,644,000 | $ | 3,644,000 | $ | — | $ | — | |||||||||
Liabilities: | |||||||||||||||||
Warrant liability | $ | 287,000 | $ | — | $ | — | $ | 287,000 | |||||||||
Balance as of | Basis of Fair Value Measurements | ||||||||||||||||
31-Dec-13 | Level 1 | Level 2 | Level 3 | ||||||||||||||
Assets: | |||||||||||||||||
Cash equivalents | $ | 4,644,000 | $ | 4,644,000 | $ | — | $ | — | |||||||||
Change in Level 3 Warrant Liability Value | ' | ||||||||||||||||
The following table summarizes the change in our Level 3 warrant liability value: | |||||||||||||||||
Three months ended | Nine months ended | ||||||||||||||||
Warrant liability | 30-Sep-14 | 30-Sep-14 | |||||||||||||||
Beginning balance | $ | — | $ | — | |||||||||||||
Fair value of warrants allocated from additional paid in capital | 421,000 | 421,000 | |||||||||||||||
Decrease in fair value recognized in operating expenses | (134,000 | ) | (134,000 | ) | |||||||||||||
Ending balance | $ | 287,000 | $ | 287,000 |
Fair_Value_Tables
Fair Value (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Fair Value [Abstract] | ' | ||||||||||||||||
Fair Value and Carrying Value of Long-term Debt | ' | ||||||||||||||||
At September 30, 2014 and December 31, 2013, the aggregate fair value and the carrying value of the Company’s fixed rate long-term debt were as follows: | |||||||||||||||||
30-Sep-14 | 31-Dec-13 | ||||||||||||||||
Fair Value | Carrying Value | Fair Value | Carrying Value | ||||||||||||||
Fixed rate long-term debt | $ | 25,328,000 | $ | 25,775,000 | $ | 26,207,000 | $ | 26,241,000 |
Capital_Availability_Details
Capital Availability (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | |
Capital Availability [Abstract] | ' | ' | ' | ' | ' |
Net loss | ($9,385,000) | ($5,258,000) | ($31,612,000) | ($16,137,000) | ' |
Accumulated deficit | -332,517,000 | ' | -332,517,000 | ' | -300,905,000 |
Net cash used | ' | ' | 25,374,000 | 25,064,000 | ' |
Proceeds from sale of Series A 3.6% convertible preferred stock and warrants to purchase common stock | 12,500,000 | ' | ' | ' | ' |
Periodic payments beginning August 2014 | ' | ' | $1,000,000 | ' | ' |
Transactions_with_Olympus_Corp2
Transactions with Olympus Corporation (Details) (USD $) | 3 Months Ended | 9 Months Ended | 0 Months Ended | 3 Months Ended | 0 Months Ended | 9 Months Ended | |||||||||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | 31-May-13 | 8-May-14 | 27-May-13 | Mar. 31, 2014 | Sep. 30, 2014 | 8-May-13 | Sep. 30, 2014 | 8-May-14 | 27-May-13 | 27-May-13 | Sep. 30, 2014 | |
Acquired Olympus Ownership [Member] | Acquired Olympus Ownership [Member] | Acquired Olympus Ownership [Member] | Acquired Olympus Ownership [Member] | Acquired Olympus Ownership [Member] | Acquired Olympus Ownership [Member] | Acquired Olympus Ownership [Member] | Acquired Olympus Ownership [Member] | Acquired Olympus Ownership [Member] | Acquired Olympus Ownership [Member] | ||||||
Alternative Payment Option One [Member] | Alternative Payment Option Two [Member] | Minimum [Member] | Maximum [Member] | Developed Technology [Member] | |||||||||||
Acquisition of Olympus' Interest in the Joint Venture [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Equity interest acquired (in hundredths) | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50.00% | ' | ' | ' | ' | ' |
Acquisition agreement date | ' | ' | ' | ' | ' | ' | 27-May-13 | ' | ' | ' | ' | ' | ' | ' | ' |
Remeasurement gain | $0 | $0 | $0 | $4,892,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Payment obligation under termination agreement | ' | ' | ' | ' | ' | ' | ' | ' | 2,700,000 | ' | ' | ' | 4,500,000 | 16,000,000 | ' |
Payment installment period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '1 year | '6 years | ' |
Installment payment amount description | ' | ' | ' | ' | ' | ' | 'Installment payments will be calculated quarterly based on 5% of Cytoribs gross sales receipts for all products sold. If Cytori receives an aggregate $35,000,000 in cash through strategic or financing arrangements during the first year of the Termination Agreement, Cytori will pay $4,500,000 upon request of Olympus as full and complete consideration under the Agreement. | ' | ' | ' | ' | ' | ' | ' | ' |
Gross sales receipts (in hundredths) | ' | ' | ' | ' | ' | ' | 5.00% | ' | ' | ' | ' | ' | ' | ' | ' |
Limit for cash through strategic or financing arrangements | ' | ' | ' | ' | ' | ' | 35,000,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Required payment for acquisition | ' | ' | ' | ' | ' | ' | 4,500,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Inputs used in valuation of acquired intangible assets [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Useful life (in years) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '7 years |
Estimated fair value | ' | ' | ' | ' | ' | ' | ' | ' | ' | 9,394,000 | ' | ' | ' | ' | 9,394,000 |
Fair value of purchase consideration | ' | ' | ' | ' | ' | ' | 4,928,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Present value risk-adjusted discount rates (in hundredths) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 9.75% | 12.75% | ' |
Unamortized discount resulting from fair value calculation of purchase obligations | ' | ' | ' | ' | ' | ' | 1,072,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted average expected term for amortization of purchase obligation | ' | ' | ' | ' | ' | ' | '1 year 9 months 18 days | ' | ' | ' | ' | ' | ' | ' | ' |
Year-to-date equity loss from investment in Joint Venture | ' | ' | ' | ' | ' | ' | 48,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Additional interest expense | 217,000 | ' | 362,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Remaining Unrecognized Future Discount | 506,000 | ' | 506,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gain on remeasurement of purchase obligation | ' | ' | ' | ' | ' | ' | ' | 600,000 | ' | ' | ' | ' | ' | ' | ' |
Increase in settlement obligation | ' | ' | ' | ' | ' | 1,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Fair value of the assets acquired and liabilities assumed at the date of acquisition [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Current assets | ' | ' | ' | ' | ' | ' | ' | ' | ' | 236,000 | ' | ' | ' | ' | ' |
Property and equipment | ' | ' | ' | ' | ' | ' | ' | ' | ' | 260,000 | ' | ' | ' | ' | ' |
Intangible assets | ' | ' | ' | ' | ' | ' | ' | ' | ' | 9,394,000 | ' | ' | ' | ' | 9,394,000 |
Total assets acquired | ' | ' | ' | ' | ' | ' | ' | ' | ' | 9,890,000 | ' | ' | ' | ' | ' |
Accrued and other current liabilities | ' | ' | ' | ' | ' | ' | ' | ' | ' | -33,000 | ' | ' | ' | ' | ' |
Total fair value of the Joint Venture | ' | ' | ' | ' | ' | ' | ' | ' | ' | 9,857,000 | ' | ' | ' | ' | ' |
Option liability | ' | ' | ' | ' | $0 | ' | ' | ' | ' | ' | $3,300,000 | $6,000,000 | ' | ' | ' |
Partnership_Agreement_with_Lor1
Partnership Agreement with Lorem Vascular (Details) (USD $) | 9 Months Ended |
In Millions, except Per Share data, unless otherwise specified | Sep. 30, 2014 |
Product Purchase Commitment [Member] | ' |
Partnership Agreement [Line Items] | ' |
Second purchase commitment | $5 |
Lorem Vascular [Member] | Equity Purchases [Member] | ' |
Partnership Agreement [Line Items] | ' |
Shares of unregistered stock purchased (in shares) | 8 |
Equity purchase price (in dollars per share) | $3 |
Proceeds from sale of shares | 24 |
Number of installments in equity purchases | 2 |
Lorem Vascular [Member] | Product Purchase Commitment [Member] | ' |
Partnership Agreement [Line Items] | ' |
Total commitment | 500 |
Gross profits percentage (in hundredths) | 30.00% |
First purchase commitment | 7 |
Order already placed | $2 |
Longterm_Debt_Details
Long-term Debt (Details) (USD $) | 3 Months Ended | 9 Months Ended | 0 Months Ended | |||||||||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 10, 2014 | Jun. 30, 2014 | Jun. 04, 2014 | 31-May-14 | Jun. 28, 2013 | Jun. 28, 2013 | Sep. 19, 2014 | Jun. 28, 2013 | |
Term Loan [Member] | Term Loan [Member] | Term Loan [Member] | ||||||||||
Final Payment [Member] | ||||||||||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Origination date | ' | ' | ' | ' | ' | ' | ' | ' | ' | 28-Jun-13 | ' | ' |
Original loan amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | $27,000,000 | ' | ' |
Interest rate (in hundredths) | ' | ' | ' | ' | ' | ' | ' | ' | ' | 9.75% | ' | ' |
Maturity date | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1-Jul-17 | ' | ' |
Fees amount associated with loan | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,620,000 | ' | 1,942,000 |
Date from which warrants are exercisable | ' | ' | ' | ' | ' | ' | ' | ' | ' | 28-Jun-13 | ' | ' |
Warrants issued to lenders (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | 596,553 | 596,553 | ' |
Warrant exercise price (in dollars per share) | $2 | ' | $2 | ' | $1 | $3.50 | $3 | $2.62 | ' | $2.26 | $2 | ' |
Warrant expiration date | ' | ' | ' | ' | ' | ' | ' | ' | ' | 28-Jun-20 | ' | ' |
Repayment of long term debt | ' | ' | 1,303,000 | 22,292,000 | ' | ' | ' | ' | ' | 18,866,000 | ' | ' |
Term Loan remaining balance at date of Amendment | ' | ' | ' | ' | ' | ' | ' | ' | ' | 17,325,000 | ' | ' |
Accrued but unpaid interest | ' | ' | ' | ' | ' | ' | ' | ' | ' | 119,000 | ' | ' |
Final payment fee | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,078,000 | ' | ' |
Prepayment fee | ' | ' | ' | ' | ' | ' | ' | ' | ' | 312,000 | ' | ' |
Net proceeds of the Term Loan, after payment of lender fees and expenses | ' | ' | 0 | 27,000,000 | ' | ' | ' | ' | ' | 7,800,000 | ' | ' |
Unamortized debt discount | ' | ' | ' | ' | ' | ' | ' | ' | ' | 949,000 | ' | ' |
Outstanding warrants issued and re-priced (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | 596,553 | ' | ' | ' |
Change in fair value of warrant liability | 134,000 | 0 | 134,000 | 418,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Effective interest rate (in hundredths) | ' | ' | ' | ' | ' | ' | ' | ' | ' | 13.92% | ' | ' |
Loss on debt extinguishment | $0 | $0 | $0 | $708,000 | ' | ' | ' | ' | ' | $708,000 | ' | ' |
Revenue_Recognition_Details
Revenue Recognition (Details) (USD $) | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | |||||||||||||||
Sep. 30, 2014 | Sep. 30, 2013 | Mar. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2012 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | |
Olympus and Olympus-Cytori [Member] | BARDA Contract [Member] | Customer Concentration Risk [Member] | Customer Concentration Risk [Member] | Customer Concentration Risk [Member] | Customer Concentration Risk [Member] | North America [Member] | North America [Member] | Japan [Member] | Japan [Member] | Europe [Member] | Europe [Member] | Other countries [Member] | Other countries [Member] | ||||||
Revenue Recognized [Member] | Revenue Recognized [Member] | Accounts Receivable [Member] | Accounts Receivable [Member] | ||||||||||||||||
Distributor | Customer | Customer | Customer | ||||||||||||||||
Distributor | |||||||||||||||||||
Revenue Recognition [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Period of services provided subsequent to date of sale | ' | ' | ' | '1 year | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of distributors | ' | ' | ' | ' | ' | ' | ' | 5 | ' | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of customers | ' | ' | ' | ' | ' | ' | ' | ' | 3 | 1 | 3 | ' | ' | ' | ' | ' | ' | ' | ' |
Product revenues | $518,000 | $1,616,000 | ' | $2,484,000 | $4,416,000 | ' | ' | ' | ' | ' | ' | $614,000 | $822,000 | $1,323,000 | $1,892,000 | $427,000 | $865,000 | $120,000 | $837,000 |
Concentration risk percentage (in hundredths) | ' | ' | ' | 100.00% | 100.00% | ' | ' | 62.00% | 39.00% | 84.00% | 54.00% | 25.00% | 19.00% | 53.00% | 43.00% | 17.00% | 19.00% | 5.00% | 19.00% |
Research and Development Arrangements [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Deferred revenues, related party | ' | ' | ' | ' | ' | 28,311,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Deferred revenue, related party, revenue recognized | ' | ' | 638,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Costs associated with the development device | 3,140,000 | 4,123,000 | ' | 12,106,000 | 11,992,000 | ' | 106,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Research and development arrangement with federal government, customer funding to offset costs incurred | ' | ' | ' | ' | ' | ' | 4,700,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum total cost-plus fixed fee | $12,100,000 | ' | ' | $12,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Research and development arrangement, initial base period | ' | ' | ' | ' | ' | ' | '2 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Inventories_Details
Inventories (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
Inventories [Abstract] | ' | ' |
Raw materials | $1,506,000 | $1,315,000 |
Work in process | 917,000 | 232,000 |
Finished goods | 2,597,000 | 2,147,000 |
Inventory, net | $5,020,000 | $3,694,000 |
Equity_Incentive_Plan_Details
Equity Incentive Plan (Details) | 9 Months Ended |
Sep. 30, 2014 | |
Equity Incentive Plan [Abstract] | ' |
Common stock shares to be issued | 3,975,000 |
Common stock shares remaining and available fo future issuances | 3,717,500 |
Loss_per_Share_Details
Loss per Share (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | |
Loss per Share [Abstract] | ' | ' | ' | ' |
Antidilutive securities excluded from computation of earnings per share (in shares) | 18,748,777 | 17,212,805 | 18,597,735 | 17,212,805 |
Commitments_and_Contingencies_
Commitments and Contingencies (Details) (USD $) | Sep. 30, 2014 |
Clinical Research Study Obligations [Member] | ' |
Recorded Unconditional Purchase Obligation [Line Items] | ' |
Purchase obligation, due in next twelve months | $4,785,000 |
Purchase obligation | 6,358,000 |
Operating Lease Obligations [Member] | ' |
Recorded Unconditional Purchase Obligation [Line Items] | ' |
Contractual Obligation, due in next twelve months | 2,197,000 |
Contractual obligation | $6,919,000 |
Sale_and_Exclusive_LicenseSupp1
Sale and Exclusive License/Supply Agreement with Bimini Technologies LLC (Details) (USD $) | 0 Months Ended | |
Jul. 30, 2013 | Sep. 30, 2014 | |
Sale and Exclusive License/Supply Agreement with Bimini Technologies LLC [Abstract] | ' | ' |
Aggregate value of consideration paid by Bimini | $5,000,000 | ' |
Gain (Loss) on Sale of Business | 4,500,000 | ' |
Estimated future transfer and training obligations | ' | 158,000 |
Milestone payments, maximum | ' | $10,000,000 |
Thin_Film_Japan_Distribution_A1
Thin Film Japan Distribution Agreement (Details) (USD $) | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||||
Feb. 28, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Jun. 30, 2014 | Dec. 31, 2013 | Dec. 31, 2004 | |
Installment | ||||||||
Thin Film Japan Distribution Agreement [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' |
License fee recorded as deferred revenue | $2,379,000 | $168,000 | ' | $168,000 | ' | ' | $212,000 | $1,500,000 |
Period before post commercialization in case of termination for proportional refund | ' | ' | ' | '3 years | ' | ' | ' | ' |
Milestone payments received | ' | ' | ' | 1,250,000 | ' | ' | ' | ' |
Number of installment payments | ' | ' | ' | 6 | ' | ' | ' | ' |
Periodic payment under termination agreement | ' | ' | ' | 200,000 | ' | ' | ' | ' |
Deferred revenues | 2,379,000 | 168,000 | ' | 168,000 | ' | ' | 212,000 | 1,500,000 |
Termination fee obligation | 1,200,000 | ' | ' | ' | ' | 0 | ' | ' |
Development revenue | $1,179,000 | $0 | $0 | $0 | $1,179,000 | ' | ' | ' |
Fair_Value_Measurements_Detail
Fair Value Measurements (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2014 |
Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Measurements, Nonrecurring [Member] | |
Level 1 [Member] | Level 1 [Member] | Level 2 [Member] | Level 2 [Member] | Level 3 [Member] | Level 3 [Member] | |||||
Assets [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash equivalents | $3,644,000 | $4,644,000 | $3,644,000 | $4,644,000 | $0 | $0 | $0 | $0 | ' | ' |
Liabilities: | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Warrant liability | 287,000 | ' | 0 | ' | 0 | ' | 287,000 | ' | ' | ' |
Fair Value, Instruments Classified in Shareholders' Equity Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Beginning balance | ' | ' | ' | ' | ' | ' | ' | ' | 0 | 0 |
Fair value of warrants allocated from additional paid in capital | ' | ' | ' | ' | ' | ' | ' | ' | 421,000 | 421,000 |
Decrease in fair value recognized in operating expenses | ' | ' | ' | ' | ' | ' | ' | ' | -134,000 | -134,000 |
Ending balance | ' | ' | ' | ' | ' | ' | ' | ' | $287,000 | $287,000 |
Fair_Value_Details
Fair Value (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
Fair Value [Member] | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Fixed rate long-term debt | $25,328,000 | $26,207,000 |
Carrying Value [Member] | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Fixed rate long-term debt | 25,775,000 | 26,241,000 |
Debt discount | $1,631,000 | $2,379,000 |
Stockholders_Equity_Details
Stockholders' Equity (Details) (USD $) | 1 Months Ended | 9 Months Ended | 1 Months Ended | 12 Months Ended | 1 Months Ended | ||||||||||
Sep. 30, 2014 | 31-May-14 | Sep. 10, 2014 | Jun. 30, 2014 | Jun. 04, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Jan. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | 31-May-14 | 31-May-14 | |
WarrantHolder | WarrantHolder | Olympus-Cytori, Inc. Joint Venture [Member] | Olympus-Cytori, Inc. Joint Venture [Member] | Lazard Capital Markets, LLC [Member] | Lazard Capital Markets, LLC [Member] | Lorem Vascular [Member] | Lorem Vascular [Member] | Lorem Vascular [Member] | WBB Securities, LLC [Member] | Institutional Investors [Member] | |||||
Closing | First Closing of Stock sale [Member] | Second Closing of Stock sale [Member] | |||||||||||||
Common Stock [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Proceeds from private placement of stock | $4,000,000 | ' | ' | ' | ' | ' | ' | ' | $3,001,000 | $20,007,000 | $15,000,000 | $12,000,000 | $3,000,000 | ' | $10,000,000 |
Convertible Preferred Stock (in units) | ' | ' | ' | ' | ' | ' | ' | ' | 1,053,000 | 7,020,000 | 8,000,000 | 4,000,000 | 4,000,000 | ' | 4,048,584 |
Common stock at a purchase price (in dollars per unit) | ' | ' | ' | ' | ' | ' | ' | ' | ' | $2.85 | ' | ' | ' | ' | ' |
Sale of stock, price per share (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | $2.69 | $3 | ' | ' | ' | $2.47 |
Purchase period of common stock | ' | ' | ' | ' | ' | ' | ' | ' | ' | '30 days | ' | ' | ' | ' | ' |
Period exercisable from the date of issuance | 'six months and one day | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of closings | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2 | ' | ' | ' | ' |
Receivables from sale of stock | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 9,000,000 | ' | ' | ' | ' |
Number of warrant holders | 13 | 47 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of shares called by warrants (in shares) | 4,032,389 | 3,156,238 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 202,429 | ' |
Common stock, par value (in dollars per share) | $0.00 | $0.00 | ' | ' | ' | $0.00 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Exercise price of warrants (in dollars per share) | $2 | $2.62 | $1 | $3.50 | $3 | ' | ' | ' | ' | ' | ' | ' | ' | $3.09 | $3 |
Number of holders who did not agree to Amendment | ' | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of shares called by warrants that expired unexercised (in shares) | ' | 38,500 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Period in which warrants will expire | ' | '5 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '5 years |
Number of common stock available in each unit of subscription agreement (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1 |
Number of warrants available in each unit of subscription agreement (in shares) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1 |
Related Party Transaction [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Royalty costs in connection with sales | ' | ' | ' | ' | ' | ' | $0 | $46,000 | ' | ' | ' | ' | ' | ' | ' |
Subsequent_Events_Details
Subsequent Events (Details) (USD $) | 1 Months Ended | 1 Months Ended | 0 Months Ended | 0 Months Ended | 0 Months Ended | 0 Months Ended | ||||||||||
Sep. 30, 2014 | 31-May-14 | Sep. 10, 2014 | Jun. 30, 2014 | Jun. 04, 2014 | Dec. 31, 2013 | 31-May-14 | Oct. 31, 2014 | Oct. 08, 2014 | Oct. 08, 2014 | Oct. 08, 2014 | Oct. 08, 2014 | Oct. 31, 2014 | Oct. 08, 2014 | Oct. 08, 2014 | Oct. 08, 2014 | |
Institutional Investors [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] | |||||||
Institutional Investors [Member] | Institutional Investors [Member] | Common Stock [Member] | Common Stock [Member] | Series A Preferred Stock [Member] | Series A Preferred Stock [Member] | |||||||||||
Subsequent Event [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Convertible Preferred Stock (in units) | ' | ' | ' | ' | ' | ' | 4,048,584 | ' | ' | ' | 13,500 | ' | ' | ' | ' | ' |
Common stock at a purchase price (in dollars per unit) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $1,000 | ' | ' | ' | ' |
Each unit consist of number of common stock (in shares) | ' | ' | ' | ' | ' | ' | 1 | ' | ' | ' | ' | ' | ' | ' | ' | 1 |
Convertible preferred stock (in hundredths) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3.60% | ' |
Par value per share (in dollars per share) | $0.00 | $0.00 | ' | ' | ' | $0.00 | ' | ' | ' | ' | ' | ' | ' | $0.00 | ' | ' |
Conversion Price (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0.52 |
Convertible Preferred Stock, Terms of Conversion | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 'number of shares of common stock equal to 100% of the conversion shares under the shares of preferred stock | ' |
Exercise price of warrants (in dollars per share) | $2 | $2.62 | $1 | $3.50 | $3 | ' | $3 | ' | ' | $0.58 | ' | ' | ' | ' | ' | ' |
Period exercisable from the date of issuance | 'six months and one day | ' | ' | ' | ' | ' | ' | ' | 'Six Months | ' | ' | ' | ' | ' | ' | ' |
Period in which warrants will expire | ' | '5 years | ' | ' | ' | ' | '5 years | ' | '5 years | ' | ' | ' | ' | ' | ' | ' |
Units Converted (in shares) | ' | ' | ' | ' | ' | ' | ' | 4,615 | ' | ' | ' | ' | 8,875,000 | ' | ' | ' |