Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Sep. 30, 2013 | Oct. 16, 2013 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | FALSE | |
Document Period End Date | 30-Sep-13 | |
Document Fiscal Year Focus | 2013 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | ATHN | |
Entity Registrant Name | ATHENAHEALTH INC | |
Entity Central Index Key | 1131096 | |
Current Fiscal Year End Date | -19 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 37,167,863 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Current assets: | ||
Cash and cash equivalents | $62,274 | $154,988 |
Short-term investments | 0 | 38,092 |
Accounts receivable - net | 97,417 | 61,916 |
Current portion of restricted cash | 0 | 1,357 |
Deferred tax assets - net | 2,134 | 6,907 |
Prepaid expenses and other current assets | 18,824 | 10,924 |
Total current assets | 180,649 | 274,184 |
Property and equipment - net | 203,638 | 54,035 |
Capitalized software costs - net | 26,912 | 16,050 |
Purchased intangible assets - net | 174,165 | 21,561 |
Goodwill | 196,183 | 48,090 |
Deferred tax assets - net | 0 | 11,759 |
Investments and other assets | 6,670 | 2,773 |
Total assets | 788,217 | 428,452 |
Current liabilities: | ||
Line of credit | 50,000 | 0 |
Current portion of long-term debt | 15,000 | 0 |
Accounts payable | 11,302 | 1,733 |
Accrued compensation | 40,364 | 36,393 |
Accrued expenses | 25,134 | 19,683 |
Current portion of deferred revenue | 33,623 | 8,209 |
Current portion of deferred rent | 100 | 799 |
Total current liabilities | 175,523 | 66,817 |
Deferred rent, net of current portion | 1,294 | 2,854 |
Long-term debt, net of current portion | 177,500 | 0 |
Deferred revenue, net of current portion | 52,631 | 45,515 |
Long-term deferred tax liability - net | 17,729 | 0 |
Other long-term liabilities | 5,181 | 1,618 |
Total liabilities | 429,858 | 116,804 |
Commitments and contingencies (note 7) | ||
Stockholders’ equity: | ||
Preferred stock, $0.01 par value: 5,000 shares authorized; no shares issued and outstanding at September 30, 2013 and December 31, 2012, respectively | 0 | 0 |
Common stock, $0.01 par value: 125,000 shares authorized; 38,422 shares issued and 37,144 shares outstanding at September 30, 2013; 37,572 shares issued and 36,294 shares outstanding at December 31, 2012 | 385 | 376 |
Additional paid-in capital | 360,869 | 303,547 |
Treasury stock, at cost, 1,278 shares | -1,200 | -1,200 |
Accumulated other comprehensive loss | -150 | -81 |
Retained (accumulated deficit) earnings | -1,545 | 9,006 |
Total stockholders’ equity | 358,359 | 311,648 |
Total liabilities and stockholders’ equity | $788,217 | $428,452 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Preferred stock, par value (dollars per share) | $0.01 | $0.01 |
Preferred stock, shares authorized (shares) | 5,000,000 | 5,000,000 |
Preferred stock, shares issued (shares) | 0 | 0 |
Preferred stock, shares outstanding (shares) | 0 | 0 |
Common stock, par value (dollars per share) | $0.01 | $0.01 |
Common stock, shares authorized (shares) | 125,000,000 | 125,000,000 |
Common stock, shares issued (shares) | 38,422,000 | 37,572,000 |
Common stock, shares outstanding (shares) | 37,144,000 | 36,294,000 |
Treasury stock, shares (shares) | 1,278,000 | 1,278,000 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Revenue: | ||||
Business services | $141,326 | $102,256 | $400,708 | $295,915 |
Implementation and other | 10,201 | 3,630 | 22,716 | 10,052 |
Total revenue | 151,527 | 105,886 | 423,424 | 305,967 |
Expense: | ||||
Direct operating | 63,245 | 41,866 | 175,820 | 121,678 |
Selling and marketing | 37,584 | 25,603 | 111,541 | 76,720 |
Research and development | 15,104 | 8,746 | 41,317 | 24,529 |
General and administrative | 21,690 | 11,913 | 77,437 | 42,073 |
Depreciation and amortization | 11,263 | 6,683 | 30,711 | 17,964 |
Total expense | 148,886 | 94,811 | 436,826 | 282,964 |
Operating income (loss) | 2,641 | 11,075 | -13,402 | 23,003 |
Other (expense) income: | ||||
Interest expense | -1,421 | -88 | -2,586 | -264 |
Other income | 30 | 176 | 147 | 498 |
Total other (expense) income | -1,391 | 88 | -2,439 | 234 |
Income (loss) before income tax (provision) benefit | 1,250 | 11,163 | -15,841 | 23,237 |
Income tax (provision) benefit | -80 | -4,953 | 5,290 | -10,445 |
Net income (loss) | $1,170 | $6,210 | ($10,551) | $12,792 |
Net income (loss) per share - Basic (in dollars per share) | $0.03 | $0.17 | ($0.29) | $0.36 |
Net income (loss) per share - Diluted (in dollars per share) | $0.03 | $0.17 | ($0.29) | $0.35 |
Weighted average shares used in computing net income (loss) per share: | ||||
Basic (shares) | 36,970 | 35,832 | 36,722 | 35,847 |
Diluted (shares) | 38,343 | 37,212 | 36,722 | 37,038 |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Income (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Net income (loss) | $1,170 | $6,210 | ($10,551) | $12,792 |
Other comprehensive income (loss): | ||||
Unrealized gain on securities, net of tax of $0 and $10 for the three and nine months ended September 30, 2013 and 2012, respectively | 0 | 9 | 20 | 47 |
Unrealized loss on change in fair value of interest rate swap, net of tax of $156 and $0 for the three and nine months ended September 30, 2013 and 2012, respectively | -234 | 0 | -234 | 0 |
Foreign currency translation adjustment | 292 | 79 | 147 | 58 |
Total other comprehensive income (loss) | 58 | 88 | -67 | 105 |
Comprehensive income (loss) | $1,228 | $6,298 | ($10,618) | $12,897 |
Consolidated_Statements_of_Com1
Consolidated Statements of Comprehensive Income (Parenthetical) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Unrealized gain (loss) on securities, tax | $0 | $10 | $0 | $10 |
Unrealized (loss) gain on change in fair value of interest rate swap, tax | $156 | $0 | $156 | $0 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income (loss) | ($10,551) | $12,792 |
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||
Depreciation and amortization | 43,674 | 20,341 |
Amortization of premium on investments | 84 | 1,011 |
Provision for uncollectible accounts | 771 | 188 |
Excess tax benefit from stock-based awards | 0 | -11,310 |
Deferred income tax | -5,395 | -1,263 |
Change in fair value of contingent considerations | -76 | 4,785 |
Stock-based compensation expense | 33,725 | 20,518 |
Other reconciling adjustments | 232 | -142 |
Changes in operating assets and liabilities: | ||
Accounts receivable | -13,128 | -4,462 |
Prepaid expenses and other current assets | -4,322 | 4,774 |
Other long-term assets | 600 | 206 |
Accounts payable | 7,401 | 1,625 |
Accrued expenses | 1,004 | 1,639 |
Accrued compensation | 1,949 | 3,373 |
Deferred revenue | 2,342 | 2,364 |
Deferred rent | -2,259 | -689 |
Net cash provided by operating activities | 56,203 | 46,180 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Capitalized software development costs | -21,320 | -10,658 |
Purchases of property and equipment | -21,405 | -19,126 |
Proceeds from sales and maturities of investments | 56,245 | 72,434 |
Purchases of investments | -2,000 | -62,689 |
Payments on acquisitions, net of cash acquired | -410,161 | 0 |
Decrease in restricted cash | 1,357 | 4,151 |
Other investing activities | 0 | 172 |
Net cash used in investing activities | -397,284 | -15,716 |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from issuance of common stock under stock plans and warrants | 25,139 | 17,969 |
Taxes paid related to net share settlement of restricted stock units | -11,093 | -3,686 |
Excess tax benefit from stock-based awards | 0 | 11,310 |
Payment of contingent consideration accrued at acquisition date | -525 | -1,550 |
Debt issuance costs | -1,699 | 0 |
Net settlement of acquired company’s board of directors equity shares | -5,806 | 0 |
Proceeds from long-term debt | 200,000 | 0 |
Proceeds from line of credit | 155,000 | 0 |
Payments on line of credit | 105,000 | 0 |
Payments on long-term debt | -7,500 | 0 |
Net cash provided by financing activities | 248,516 | 24,043 |
Effects of exchange rate changes on cash and cash equivalents | -149 | 26 |
Net (decrease) increase in cash and cash equivalents | -92,714 | 54,533 |
Cash and cash equivalents at beginning of period | 154,988 | 57,781 |
Cash and cash equivalents at end of period | 62,274 | 112,314 |
Non-cash transactions | ||
Property, equipment and purchased software recorded in accounts payable and accrued expenses | 1,196 | 2,908 |
Tax benefit recorded in prepaid expenses and other current assets | 11,247 | |
Fair value of equity awards assumed | 13,028 | 0 |
Additional disclosures | ||
Cash received for interest | 451 | 1,360 |
Cash paid for interest | 1,990 | 0 |
Cash paid for taxes | $1,273 | $3,869 |
BASIS_OF_PRESENTATION
BASIS OF PRESENTATION | 9 Months Ended |
Sep. 30, 2013 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BASIS OF PRESENTATION | BASIS OF PRESENTATION |
The accompanying unaudited condensed consolidated financial statements have been prepared by athenahealth, Inc. (“athenahealth” or “we”) in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial reporting and as required by Regulation S-X, Rule 10-01. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of our management, the accompanying unaudited condensed consolidated financial statements contain all adjustments (consisting of items of a normal and recurring nature) necessary to present fairly the financial position as of September 30, 2013, and the results of operations and cash flows for the nine month period ended September 30, 2013 and 2012. The results of operations for the nine month period ended September 30, 2013 are not necessarily indicative of the results to be expected for the full year. When preparing financial statements in conformity with GAAP, we must make estimates and assumptions that affect the reported amounts of assets and liabilities, 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. Actual results could differ from those estimates. | |
We consider events or transactions that occur after the balance sheet date but before the financial statements are issued to provide additional evidence relative to certain estimates or to identify matters that require additional disclosure. Subsequent events have been evaluated through the date of issuance of these financial statements. The accompanying unaudited condensed consolidated financial statements and notes thereto should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2012, included in our Annual Report on Form 10-K, which was filed with the Securities and Exchange Commission (“SEC”) on February 11, 2013. | |
Segment Reporting – We disclose information about our operating segments based on the way that management organizes the segments within athenahealth for making operating decisions and assessing financial performance. Operating segments are identified as components of an enterprise about which separate discrete financial information is evaluated by the chief operating decision-maker (“CODM”), or decision-making group, in making decisions regarding resource allocation and assessing performance. We are in the process of analyzing the information that will be prepared and presented to the CODM due to the acquisitions of Epocrates, Inc. (“Epocrates”) and the Arsenal on the Charles during the nine months ended September 30, 2013 (see Note 2 Acquisitions). We anticipate that we will have at least two operating segments – athenahealth and Epocrates. Historically, we have operated in one segment. | |
Interim Tax Estimate – Due to the fact that we are projecting a nominal pre-tax income (loss) for the year and have significant permanent differences, we cannot reasonably predict our estimated effective tax rate for the year; therefore, we have used a discrete tax approach in calculating the year-to-date provision for the period ended September 30, 2013. | |
Related Party Transaction – During the three months ended September 30, 2013, we made an investment in a vendor. The total expense for the three month period ended September 30, 2013, was $0.4 million and the total amount payable at September 30, 2013 was $0.1 million. |
ACQUISITIONS
ACQUISITIONS | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Business Combinations [Abstract] | ||||||||||||||||
ACQUISITIONS | ACQUISITIONS | |||||||||||||||
Watertown, MA Corporate Headquarters – the Arsenal on the Charles | ||||||||||||||||
On May 10, 2013, athenahealth, through its wholly-owned subsidiary Athena Arsenal, LLC, completed the acquisition of the real estate commonly known as the Arsenal on the Charles, located in Watertown, Massachusetts. The Arsenal on the Charles is an expansive 29-acre, multi-building, commercial property where we were leasing space for our headquarters and related operating activities prior to the transaction. The purpose of this acquisition is to allow for future expansion of the corporate headquarters to accommodate anticipated headcount growth. The purchase price was $168.5 million, subject to working capital adjustments. The fair value of the consideration paid was $167.3 million, all of which was paid in cash. | ||||||||||||||||
The following table summarizes the estimated fair values of assets acquired and liabilities assumed as of the date of acquisition: | ||||||||||||||||
Prepaid expenses and other current assets | $ | 685 | ||||||||||||||
Property, equipment and buildings | 144,071 | |||||||||||||||
Purchased intangible assets | 25,545 | |||||||||||||||
Accrued expenses | (271 | ) | ||||||||||||||
Deferred revenue | (789 | ) | ||||||||||||||
Other long-term liabilities | (1,916 | ) | ||||||||||||||
Total identifiable net assets | $ | 167,325 | ||||||||||||||
The fair values assigned to tangible and identifiable intangible assets acquired and liabilities assumed are based on management’s estimates and assumptions and are based on the information that was available as of the date of the acquisition. We believe that the information provides a reasonable basis for estimating the fair values of assets acquired and liabilities assumed, but certain items such as the value of the purchased tangible and intangible assets and certain working capital adjustments to the purchase price may be subject to change as additional information is received about facts and circumstances that existed at the date of acquisition. Thus, the provisional measurements of fair value set forth above are subject to change. We expect to finalize the valuation as soon as practicable, but not later than one year from the acquisition date. | ||||||||||||||||
The following table sets forth the fair value of the preliminary components of the identifiable intangible assets acquired by asset class: | ||||||||||||||||
Above market leases | $ | 3,298 | ||||||||||||||
In-place leases | 22,247 | |||||||||||||||
Total intangible assets subject to amortization | $ | 25,545 | ||||||||||||||
The value of any in-place lease is estimated to be equal to the property owners’ avoidance of costs necessary to release the property for a lease term equal to the remaining primary in-place lease term and the value of investment grade tenancy. The cost avoidance to the property owners of vacancy/leasing costs necessary to lease the property for a lease term equal to the remaining in-place lease term is derived first by determining the in-place lease term on the subject lease. Then, based on our review of the market, the cost to be borne by a property owner to replicate a market lease to the remaining in-place term was estimated. These costs consist of: (i) rent lost during downtime (e.g., assumed periods of vacancy), (ii) estimated expenses that would be incurred by the property owner during periods of vacancy, (iii) rent concessions (e.g., free rent), (iv) leasing commissions, and (v) tenant improvement allowances. We determine these values using our own estimates along with third-party appraisals. We amortize the capitalized value of in-place lease intangible assets to expense over the remaining initial term of each lease. We amortize the capitalized value of above market leases to expense over the initial and expected renewal terms of the leases. No amortization period for intangible assets will exceed the remaining depreciable life of the building. | ||||||||||||||||
The amounts of third-party tenant revenue (included in the line item "Implementation and other") and net loss from the Arsenal on the Charles included in our condensed consolidated statements of income from the acquisition date of May 10, 2013, through the period ended September 30, 2013, are $6.1 million and $0.2 million, respectively. Direct operating expense from the acquisition date of May 10, 2013, through the period ended September 30, 2013, includes $5.9 million of costs associated with third-party tenant revenue for the Arsenal on the Charles. | ||||||||||||||||
We incurred transaction costs in connection with the acquisition of $2.4 million during the nine months ended September 30, 2013, respectively, and $3.1 million in total. These costs are included in general and administrative expenses. | ||||||||||||||||
Epocrates, Inc. | ||||||||||||||||
On March 12, 2013, we acquired Epocrates, a leading provider of essential clinical content, practice tools, and health industry engagement via mobile devices at the point of care. We acquired Epocrates for the assembled workforce, expected synergies, and accelerated awareness of athenahealth’s services across the physician market and to deliver high-value information to the clinical community. The acquisition date fair value of the consideration transferred for Epocrates, less cash and short-term investments acquired was approximately $237.6 million, which consisted of the following: | ||||||||||||||||
Cash payments | $ | 294,632 | ||||||||||||||
Fair value of vested stock options and restricted stock units assumed | 13,028 | |||||||||||||||
Fair value of total consideration | 307,660 | |||||||||||||||
Less cash acquired | (51,796 | ) | ||||||||||||||
Less short-term investments acquired | (18,250 | ) | ||||||||||||||
Total | $ | 237,614 | ||||||||||||||
The value of the share consideration for Epocrates’ common stock was based on the average closing sales prices per share of athenahealth common stock for the ten trading days ending on the second trading day prior to the closing of the acquisition. The fair value of the stock options and restricted stock units assumed by us was determined using the Black-Scholes option pricing model. The share conversion ratio of 0.1239 was applied to convert Epocrates stock options and restricted stock units to athenahealth stock options and restricted stock units. | ||||||||||||||||
We assumed stock options and restricted stock units with a fair value of $22.6 million. Of the total consideration, $13.0 million was allocated to the purchase consideration and $9.6 million was allocated to future services and will be expensed over the remaining service periods on a straight-line basis over the remaining service period. In the nine months ended September 30, 2013, stock-based compensation expense recognized for stock options and restricted stock units assumed was $7.6 million. | ||||||||||||||||
The following table summarizes the estimated fair values of assets acquired and liabilities assumed as of the date of acquisition: | ||||||||||||||||
Accounts receivable | $ | 23,144 | ||||||||||||||
Other current and long-term assets | 3,833 | |||||||||||||||
Property, equipment and capitalized software costs | 4,168 | |||||||||||||||
Purchased intangible assets | 139,900 | |||||||||||||||
Current liabilities | (11,054 | ) | ||||||||||||||
Deferred tax liabilities, net | (39,811 | ) | ||||||||||||||
Deferred revenue | (29,400 | ) | ||||||||||||||
Other long-term liabilities | (1,259 | ) | ||||||||||||||
Total identifiable net assets | $ | 89,521 | ||||||||||||||
Goodwill | 148,093 | |||||||||||||||
$ | 237,614 | |||||||||||||||
The excess of purchase consideration over the fair value of net tangible and identifiable intangible assets acquired was recorded as goodwill. The fair values assigned to tangible and identifiable intangible assets acquired and liabilities assumed were based on management’s estimates and assumptions based on the information that was available as of the date of the acquisition. We believe that the information provides a reasonable basis for estimating the fair values of assets acquired and liabilities assumed, but certain items such as accounts receivable, purchased intangible assets, current and non-current income taxes payable, deferred taxes, deferred revenue and uncertain tax benefits may be subject to change as additional information is received about facts and circumstances that existed at the date of acquisition and certain tax returns are finalized. Thus, the provisional measurements of fair value set forth above are subject to change. We expect to finalize the valuation as soon as practicable, but not later than one year from the acquisition date. | ||||||||||||||||
The following table sets forth the preliminary components of the identifiable intangible assets acquired by asset class and their preliminary estimated useful lives as of the date of acquisition: | ||||||||||||||||
Fair Value | Useful Life | |||||||||||||||
Physician network | $ | 104,500 | 14 years | |||||||||||||
Drug information content | 10,000 | 5 years | ||||||||||||||
Trade name | 11,500 | 10 years | ||||||||||||||
Customer backlog | 2,900 | 1.5 years | ||||||||||||||
Epocrates non-compete agreement | 4,500 | 1.5 years | ||||||||||||||
Developed technology | 6,500 | 3 years | ||||||||||||||
Total intangible assets subject to amortization | $ | 139,900 | ||||||||||||||
We anticipate that we will allocate the acquired physician network among our operating segments once determined. The Epocrates segment will represent the fair values of the underlying relationships and agreements with Epocrates customers. The physician network related to the athenahealth segment will represent the fair values of the savings associated with future marketing spend for the athenahealth segment services to the acquired physician network. Drug information content represents the fair value of the cost to replace the drug information and interaction content used by the physician’s network. The trade name represents the fair value of the brand and name recognition associated with the marketing of Epocrates’ service offerings. Customer backlog represents the estimated fair value of existing contractual backlog orders as of the acquisition date. Epocrates non-compete agreement represents the estimated fair value of the contract between athenahealth and a former member of Epocrates management. Developed technology represents the estimated fair value of Epocrates’ mobile device platform. All of the purchased intangible assets related to the Epocrates transaction have finite lives. For those purchased intangible assets where an income approach was used, we considered the projected undiscounted cash flows as the best indication of the pattern of economic benefit expected from each asset. | ||||||||||||||||
The goodwill balance is primarily attributed to the assembled workforce and expanded market opportunities when integrating Epocrates’ mobile device platform with the athenahealth service offerings. We anticipate goodwill will be allocated among our reporting units and operating segments once determined. The goodwill balance is not deductible for U.S. income tax purposes. | ||||||||||||||||
The amounts of revenue and net loss of Epocrates included in our condensed consolidated statements of income from the acquisition date of March 12, 2013, through the period ended September 30, 2013, are $33.5 million and $17.6 million, respectively. The net loss includes $7.6 million in stock-based compensation expense primarily related to the acceleration of certain individuals’ stock awards upon termination. | ||||||||||||||||
We incurred transaction costs in connection with the acquisition of $0.0 million and $2.7 million during the three and nine months ended September 30, 2013, respectively, and $3.2 million in total. These costs are included in general and administrative expenses. | ||||||||||||||||
As part of the integration of Epocrates, we communicated to certain employees severance and retention bonuses which total $4.2 million to be paid through the end of 2013. The following table summarizes these amounts on the condensed consolidated statements of income for the nine months ended September 30, 2013: | ||||||||||||||||
Summary of roll forward of integration costs | ||||||||||||||||
Beginning balance, January 1, 2013 | $ | — | ||||||||||||||
Addition to provision | 2,209 | |||||||||||||||
Cash payments | (195 | ) | ||||||||||||||
Ending balance, March 31, 2013 | $ | 2,014 | ||||||||||||||
Addition to provision | 979 | |||||||||||||||
Change in estimate | (129 | ) | ||||||||||||||
Cash payments | (1,122 | ) | ||||||||||||||
Ending balance, June 30, 2013 | $ | 1,742 | ||||||||||||||
Addition to provision | 526 | |||||||||||||||
Change in estimate | (72 | ) | ||||||||||||||
Cash payments | (692 | ) | ||||||||||||||
Ending balance, September 30, 2013 | $ | 1,504 | ||||||||||||||
Pro Forma Presentation | ||||||||||||||||
The following pro forma financial information summarizes the combined results of operations for athenahealth as though the acquisitions of Epocrates and the Arsenal on the Charles occurred on January 1, 2012. The unaudited pro forma financial information is as follows: | ||||||||||||||||
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Revenue | $ | 151,527 | $ | 132,833 | $ | 443,196 | $ | 390,673 | ||||||||
Net income (loss) | $ | 1,170 | $ | 982 | $ | (14,953 | ) | $ | (9,101 | ) | ||||||
Net income (loss) per share – Basic | $ | 0.03 | $ | 0.03 | $ | (0.41 | ) | $ | (0.25 | ) | ||||||
Net income (loss) per share – Diluted | $ | 0.03 | $ | 0.03 | $ | (0.41 | ) | $ | (0.24 | ) | ||||||
The pro forma financial information for all periods presented has been calculated after adjusting the results of Epocrates and the Arsenal on the Charles to reflect the business combination accounting effects resulting from these acquisitions including the amortization expenses from acquired intangible assets, the deprecation expenses from acquired tangible assets, the stock-based compensation expense for unvested stock options and restricted stock units assumed and the related tax effects as though the acquisition occurred as of January 1, 2012. The pro forma financial information is for informational purposes only and is not indicative of the results of operations that would have been achieved if the acquisition had taken place at the beginning of our 2012 fiscal year. |
NET_INCOME_LOSS_PER_SHARE
NET INCOME (LOSS) PER SHARE | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||
NET INCOME (LOSS) PER SHARE | NET INCOME (LOSS) PER SHARE | ||||||||||||||||
Basic net income (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted net income (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding and potentially dilutive securities outstanding during the period under the treasury stock method. Potentially dilutive securities include stock options, restricted stock units, and shares to be purchased under the employee stock purchase plan. Under the treasury stock method, dilutive securities are assumed to be exercised at the beginning of the period and as if funds obtained thereby were used to purchase common stock at the average market price during the period. Securities are excluded from the computations of diluted net income per share if their effect would be anti-dilutive to earnings per share. | |||||||||||||||||
The following table reconciles the weighted average shares outstanding for basic and diluted net income (loss) per share for the periods indicated: | |||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
Net income (loss) | $ | 1,170 | $ | 6,210 | $ | (10,551 | ) | $ | 12,792 | ||||||||
Weighted average shares used in computing basic net income (loss) per share | 36,970 | 35,832 | 36,722 | 35,847 | |||||||||||||
Net income (loss) per share – Basic | $ | 0.03 | $ | 0.17 | $ | (0.29 | ) | $ | 0.36 | ||||||||
Net income (loss) | $ | 1,170 | $ | 6,210 | $ | (10,551 | ) | $ | 12,792 | ||||||||
Weighted average shares used in computing basic net income (loss) per share | 36,970 | 35,832 | 36,722 | 35,847 | |||||||||||||
Effect of dilutive securities | 1,373 | 1,380 | — | 1,191 | |||||||||||||
Weighted average shares used in computing diluted net income (loss) per share | 38,343 | 37,212 | 36,722 | 37,038 | |||||||||||||
Net income (loss) per share – Diluted | $ | 0.03 | $ | 0.17 | $ | (0.29 | ) | $ | 0.35 | ||||||||
The computation of diluted net income per share does not include 0.3 million of stock options and restricted stock units for the three months ended September 30, 2013, because their inclusion would have an anti-dilutive effect on net income per share. The computation of diluted net income per share does not include 0.4 million and 0.4 million of stock options and restricted stock units for the three and nine months ended September 30, 2012, respectively, because their inclusion would have an anti-dilutive effect on net income per share. For the nine months ended September 30, 2013, there were 3.5 million stock options and restricted stock units excluded from the calculation of the diluted net income (loss) per share, since to include them would be anti-dilutive. |
FAIR_VALUE_OF_FINANCIAL_INSTRU
FAIR VALUE OF FINANCIAL INSTRUMENTS | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||
FAIR VALUE OF FINANCIAL INSTRUMENTS | FAIR VALUE OF FINANCIAL INSTRUMENTS | ||||||||||||||||
As of September 30, 2013, and December 31, 2012, the carrying amounts of cash and cash equivalents, restricted cash, receivables, accounts payable and accrued expenses approximated their estimated fair values because of the short-term nature of these financial instruments. Included in cash and cash equivalents as of September 30, 2013 and December 31, 2012, are money market fund investments of less than $0.1 million and $59.4 million, respectively, which are reported at fair value. As of September 30, 2013, we had $192.5 million outstanding on its term loan facility and $50 million outstanding on its revolving credit facility (see Note 6. Debt) which approximate their fair values due to their variable rate nature at current market rates. As of December 31, 2012, we had no outstanding debt. | |||||||||||||||||
The following table presents information about our financial assets and liabilities that are measured at fair value on a recurring basis as of September 30, 2013, and December 31, 2012, and indicates the fair value hierarchy of the valuation techniques we utilized to determine such fair value. In general, fair values determined by Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities and fair values determined by Level 2 inputs utilize quoted prices (unadjusted) in active markets for similar assets or liabilities. The fair values determined by Level 3 inputs are unobservable values which are supported by little or no market activity. | |||||||||||||||||
Fair Value Measurements At September 30, 2013, Using | |||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Cash and cash equivalents: | |||||||||||||||||
Money market funds | $ | 37 | $ | — | $ | — | $ | 37 | |||||||||
Total assets | $ | 37 | $ | — | $ | — | $ | 37 | |||||||||
Interest rate swap liability | $ | — | $ | (390 | ) | $ | — | $ | (390 | ) | |||||||
Total liabilities | $ | — | $ | (390 | ) | $ | — | $ | (390 | ) | |||||||
Fair Value Measurements as of December 31, 2012, Using | |||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Cash and cash equivalents: | |||||||||||||||||
Money market funds | $ | 89,480 | $ | — | $ | — | $ | 89,480 | |||||||||
Available-for-sale investments: | |||||||||||||||||
Commercial paper | — | 11,748 | — | 11,748 | |||||||||||||
Corporate bonds | — | 20,334 | — | 20,334 | |||||||||||||
Certificate of deposit | — | 6,010 | — | 6,010 | |||||||||||||
Total assets | $ | 89,480 | $ | 38,092 | $ | — | $ | 127,572 | |||||||||
Accrued contingent consideration | $ | — | $ | — | $ | (448 | ) | $ | (448 | ) | |||||||
Total liabilities | $ | — | $ | — | $ | (448 | ) | $ | (448 | ) | |||||||
Money market funds, certificates of deposit, corporate bonds and commercial paper are valued using a market approach based upon the quoted market prices of identical instruments when available or other observable inputs such as trading prices of identical instruments in inactive markets or similar securities. It is our policy to recognize transfers between levels of the fair value hierarchy, if any, at the end of the reporting period; however, there have been no such transfers during any periods presented. The estimated fair value of our interest rate swap agreement with certain financial institutions at September 30, 2013, was $0.4 million, based on inputs other than quoted prices that are observable for the interest rate swap (Level 2). There was no interest rate swap agreement at December 31, 2012. | |||||||||||||||||
Contingent consideration is recorded at fair value as an element of consideration paid with subsequent adjustments recognized in the consolidated statement of income. At the acquisition date and through the end of the measurement period, the fair value of the accrued contingent consideration was determined using a probability-weighted income approach based on upside, downside and base case scenarios. This approach is based on significant inputs that are not observable in the market, which are referred to as Level 3 inputs. The contingent consideration related to our acquisition of Proxsys in 2011 ranged from zero to $5.0 million and was payable in quarterly installments based upon the cross-selling of our athenaCollector services into Proxsys’ new and acquired customer and physician sender base, from the acquisition date to the second year anniversary of the acquisition in the third quarter of 2013. As of December 31, 2012, we had a probability adjusted level of 60% for the base case and 20% for the upside and downside scenarios. We estimated the fair value of the contingent consideration at December 31, 2012, to be $0.4 million, primarily related to how much had been earned and the amount of time left to earn the additional consideration. We accrued an additional general and administrative expense of $0.1 million during the three and nine months ended September 30, 2013, for the final payment based on the final cross-selling results. We paid $0.5 million related to the second contingent consideration during September 2013. As of September 30, 2013, there are no contingent consideration arrangements owed or outstanding. | |||||||||||||||||
The reconciliations for the fair values of financial instruments determined by Level 3 inputs for the periods presented are as follows: | |||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
Balance, beginning of period | $ | 448 | $ | 6,259 | $ | 448 | $ | 8,176 | |||||||||
Payments | (524 | ) | (1,843 | ) | (524 | ) | (2,650 | ) | |||||||||
Change in fair value (included in general and administrative expenses) | 76 | (3,675 | ) | 76 | (4,785 | ) | |||||||||||
Balance, end of period | $ | — | $ | 741 | $ | — | $ | 741 | |||||||||
PROPERTY_AND_EQUIPMENT
PROPERTY AND EQUIPMENT | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Property, Plant and Equipment [Abstract] | |||||||||
PROPERTY AND EQUIPMENT | PROPERTY AND EQUIPMENT | ||||||||
The fair values of the property and equipment acquired as part of the purchase of the Arsenal on the Charles are allocated to buildings, land, and land improvements in the amounts of $121.3 million, $21.0 million, and $1.8 million, respectively. | |||||||||
Property and equipment consist of the following as of: | |||||||||
September 30, 2013 | December 31, 2012 | ||||||||
Equipment | $ | 74,358 | $ | 56,078 | |||||
Furniture and fixtures | 7,709 | 5,297 | |||||||
Leasehold improvements | 2,756 | 15,518 | |||||||
Airplane | 3,156 | 3,156 | |||||||
Building | 136,181 | 14,644 | |||||||
Building improvements | 18,281 | 3,500 | |||||||
Land | 23,059 | 2,035 | |||||||
Land improvements | 2,735 | 915 | |||||||
Total property and equipment, at cost | 268,235 | 101,143 | |||||||
Accumulated depreciation and amortization | (68,156 | ) | (49,902 | ) | |||||
Construction in progress | 3,559 | 2,794 | |||||||
Property and equipment, net | $ | 203,638 | $ | 54,035 | |||||
Depreciation expense on property and equipment was $6.6 million and $4.5 million for the three months ended September 30, 2013, and 2012, respectively. Depreciation expense on property and equipment was $18.3 million and $12.2 million for the nine months ended September 30, 2013, and 2012, respectively. |
DEBT
DEBT | 9 Months Ended | ||||||||||||||
Sep. 30, 2013 | |||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||
DEBT | DEBT | ||||||||||||||
2011 Line of Credit – On October 20, 2011, we entered into a $100.0 million revolving credit agreement (“Revolving Credit Agreement”) with a term of five years. The Revolving Credit Agreement contains certain covenants, including consolidated leverage and minimum fixed charge coverage ratios. The interest rates applicable to revolving loans under the Revolving Credit Agreement are at either (i) the British Bankers Association London Interbank Offered Rate (“LIBOR”) plus an interest margin based on our consolidated leverage ratio, or (ii) the base rate (which is the highest of (a) the bank’s prime rate, (b) the Federal Funds rate plus 0.50%, and (c) one month LIBOR plus 1.00%) plus an interest margin based on our consolidated leverage ratio. | |||||||||||||||
2013 Commitment Letter – On January 7, 2013, we entered into a commitment letter, pursuant to which Bank of America, N.A. committed to increase its commitment to provide revolving loans under the Revolving Credit Agreement by an amount up to $55 million as a source of funding for the Epocrates transaction (see Note 2 Acquisitions). We were required to pay financing fees of $0.3 million for this commitment. | |||||||||||||||
On March 11, 2013, we borrowed $155.0 million under the Revolving Credit Agreement as a source of funding for the Epocrates transaction. We repaid $50.0 million of the $155.0 million as of March 31, 2013. All amounts outstanding under the Revolving Credit Agreement were repaid on May 10, 2013, as discussed below. | |||||||||||||||
2013 Credit Agreement – On May 10, 2013, we entered into a $325 million senior credit facility consisting of a $200 million unsecured term loan facility and a $125 million unsecured revolving credit facility (the “Senior Credit Facility”). We may increase the Senior Credit Facility up to an additional $100 million, subject to certain conditions including obtaining lender commitments. The terms and conditions of the Senior Credit Facility are customary to facilities of this nature. The Senior Credit Facility expires on May 10, 2018, although we may prepay the Senior Credit Facility in whole or in part at any time without premium or penalty, and the unutilized portion of the commitments may be irrevocably reduced or terminated by us in whole or in part without penalty or premium. The Senior Credit Facility contains customary default provisions and certain financial and nonfinancial covenants including limitations on our consolidated leverage ratio and capital expenditures. | |||||||||||||||
On May 10, 2013, we borrowed $200 million under the unsecured term loan facility and $50 million under the unsecured revolving credit facility of the Senior Credit Facility to refinance existing indebtedness described above, to finance the Arsenal on the Charles acquisition as described in Note 2. Acquisitions, and for working capital and other general corporate purposes. The unsecured term loan facility was payable quarterly starting June 30, 2013, in the amount of $3.75 million each quarter. As of September 30, 2013, we had $192.5 million outstanding on the unsecured term loan facility and $50.0 million outstanding on the unsecured revolving credit facility. As of September 30, 2013, we had $75 million available on the unsecured revolving credit facility. | |||||||||||||||
Any loan under the Senior Credit Facility will bear interest at the same rates as in the Revolving Credit Agreement. The interest rate for the Senior Credit Facility as of September 30, 2013 was 1.93%. | |||||||||||||||
We were required to pay financing fees of $1.3 million for the Senior Credit Facility, which are being amortized as interest expense in the condensed consolidated statements of income over the five-year term of the agreement. | |||||||||||||||
Future principle payments of the unsecured term loan facility at September 30, 2013 are as follows: | |||||||||||||||
Amount | |||||||||||||||
Remaining 2013 | $ | 3,750 | |||||||||||||
2014 | 15,000 | ||||||||||||||
2015 | 15,000 | ||||||||||||||
2016 | 15,000 | ||||||||||||||
2017 | 15,000 | ||||||||||||||
Thereafter | 128,750 | ||||||||||||||
Total | 192,500 | ||||||||||||||
Less current portion | 15,000 | ||||||||||||||
Long-term portion | $ | 177,500 | |||||||||||||
During the quarter ended September 30, 2013, we entered into an interest rate swap agreement designed to fix the variable interest rate payable on $120 million of our outstanding borrowings under the Senior Credit Facility at 0.8396% exclusive of the credit spread under the Senior Credit Facility. | |||||||||||||||
The interest rate swap agreement was designed to manage exposure to interest rates on our variable rate indebtedness. We recognize all derivatives on our balance sheet at fair value. We have designated our interest rate swap agreement as a cash flow hedge. Changes in the fair value of the interest rate swap are recognized in other comprehensive income (loss) (“OCI”) until the hedged items are recognized in earnings. Hedge ineffectiveness, if any, associated with the interest rate swap will be reported by us in interest expense. There was no ineffectiveness associated with the interest rate swap during the quarter ended September 30, 2013, nor was any amount excluded from ineffectiveness testing. | |||||||||||||||
The fair value of the interest rate swap recognized in other long-term liabilities and in OCI is as follows (in thousands): | |||||||||||||||
Fair Value | |||||||||||||||
Effective Date | Notional Amount | Fixed Rate | Maturity | 30-Sep-13 | 31-Dec-12 | ||||||||||
August 31, 2013 | 120,000 | 0.8396 | % | August 31, 2016 | $ | (390 | ) | $ | — | ||||||
COMMITMENTS_AND_CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2013 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES |
On January 11, 2013, a complaint captioned Bushansky v. Epocrates, Inc., et al., Case No. 519078, was filed in San Mateo County Superior Court (the “Court”) on behalf of a putative class of Epocrates’ shareholders against Epocrates and each member of the Epocrates board of directors. This complaint challenged the proposed merger between Epocrates and one of our wholly owned subsidiaries. On January 25, 2013, a similar complaint was filed in the Court captioned DeJoice v. Epocrates, et al., Case No. 519461. This second complaint made similar allegations against Epocrates and each member of the Epocrates board of directors and included a claim against us for aiding and abetting a breach of fiduciary duty. On January 31, 2013, the Bushansky complaint was amended to include additional allegations. Plaintiffs allege, among other things, that the Epocrates directors breached their fiduciary duties by allegedly agreeing to sell Epocrates at an unfair and inadequate price, failing to take steps to maximize the sale price of Epocrates, and making material omissions to the preliminary proxy statement dated January 25, 2013. The complaints sought to enjoin the merger, other equitable relief, and monetary damages. On March 5, 2013, Epocrates and the plaintiffs signed a memorandum of understanding in which the parties agreed to enter into a stipulation of settlement whereby the plaintiffs and all class members would release all claims related to the merger in exchange for Epocrates filing a supplement to its definitive proxy statement regarding the merger with the SEC, which would include additional disclosures regarding the merger agreement, and an agreement to negotiate in good faith regarding the amount of attorneys’ fees and expenses for which plaintiffs may seek approval from the Court. On October 4, 2013, the Court granted final settlement approval including a grant of fees and expenses in the amount of $335,000 to plaintiffs’ counsel. The settlement has no material impact on the Company’s condensed consolidated financial statements. | |
In addition, we are engaged from time to time in certain legal disputes arising in the ordinary course of business, including employment discrimination claims and challenges to our intellectual property. We believe that we have adequate legal defenses and that the likelihood of a loss contingency relating to the ultimate dispositions of any of these disputes is remote. When the likelihood of a loss contingency becomes at least reasonably possible with respect to any of these disputes, or, as applicable in the future, if there is at least a reasonable possibility that a loss exceeding amounts already recognized may have been incurred, we will revise our disclosures in accordance with the relevant authoritative guidance. | |
Additionally, we will accrue liability for loss contingencies when we believe that it is both probable that a liability has been incurred and that we can reasonably estimate the amount of the loss. We will review these accruals and adjust them to reflect ongoing negotiations, settlements, rulings, advice of legal counsel, and other relevant information. To the extent new information is obtained, and our views on the probable outcomes of claims, suits, assessments, investigations, or legal proceedings change, changes in our accrued liabilities would be recorded in the period in which such determination is made. |
BASIS_OF_PRESENTATION_Policies
BASIS OF PRESENTATION (Policies) | 9 Months Ended |
Sep. 30, 2013 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Segment Reporting | Segment Reporting – We disclose information about our operating segments based on the way that management organizes the segments within athenahealth for making operating decisions and assessing financial performance. Operating segments are identified as components of an enterprise about which separate discrete financial information is evaluated by the chief operating decision-maker (“CODM”), or decision-making group, in making decisions regarding resource allocation and assessing performance. We are in the process of analyzing the information that will be prepared and presented to the CODM due to the acquisitions of Epocrates, Inc. (“Epocrates”) and the Arsenal on the Charles during the nine months ended September 30, 2013 (see Note 2 Acquisitions). We anticipate that we will have at least two operating segments – athenahealth and Epocrates. Historically, we have operated in one segment. |
Interim Tax Estimate | Interim Tax Estimate – Due to the fact that we are projecting a nominal pre-tax income (loss) for the year and have significant permanent differences, we cannot reasonably predict our estimated effective tax rate for the year; therefore, we have used a discrete tax approach in calculating the year-to-date provision for the period ended September 30, 2013. |
ACQUISITIONS_Tables
ACQUISITIONS (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Business Acquisition, Pro Forma Information | The following pro forma financial information summarizes the combined results of operations for athenahealth as though the acquisitions of Epocrates and the Arsenal on the Charles occurred on January 1, 2012. The unaudited pro forma financial information is as follows: | |||||||||||||||
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Revenue | $ | 151,527 | $ | 132,833 | $ | 443,196 | $ | 390,673 | ||||||||
Net income (loss) | $ | 1,170 | $ | 982 | $ | (14,953 | ) | $ | (9,101 | ) | ||||||
Net income (loss) per share – Basic | $ | 0.03 | $ | 0.03 | $ | (0.41 | ) | $ | (0.25 | ) | ||||||
Net income (loss) per share – Diluted | $ | 0.03 | $ | 0.03 | $ | (0.41 | ) | $ | (0.24 | ) | ||||||
Arsenal on the Charles | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following table summarizes the estimated fair values of assets acquired and liabilities assumed as of the date of acquisition: | |||||||||||||||
Prepaid expenses and other current assets | $ | 685 | ||||||||||||||
Property, equipment and buildings | 144,071 | |||||||||||||||
Purchased intangible assets | 25,545 | |||||||||||||||
Accrued expenses | (271 | ) | ||||||||||||||
Deferred revenue | (789 | ) | ||||||||||||||
Other long-term liabilities | (1,916 | ) | ||||||||||||||
Total identifiable net assets | $ | 167,325 | ||||||||||||||
Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination | The following table sets forth the fair value of the preliminary components of the identifiable intangible assets acquired by asset class: | |||||||||||||||
Above market leases | $ | 3,298 | ||||||||||||||
In-place leases | 22,247 | |||||||||||||||
Total intangible assets subject to amortization | $ | 25,545 | ||||||||||||||
Epocrates Inc | ||||||||||||||||
Business Acquisition [Line Items] | ||||||||||||||||
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following table summarizes the estimated fair values of assets acquired and liabilities assumed as of the date of acquisition: | |||||||||||||||
Accounts receivable | $ | 23,144 | ||||||||||||||
Other current and long-term assets | 3,833 | |||||||||||||||
Property, equipment and capitalized software costs | 4,168 | |||||||||||||||
Purchased intangible assets | 139,900 | |||||||||||||||
Current liabilities | (11,054 | ) | ||||||||||||||
Deferred tax liabilities, net | (39,811 | ) | ||||||||||||||
Deferred revenue | (29,400 | ) | ||||||||||||||
Other long-term liabilities | (1,259 | ) | ||||||||||||||
Total identifiable net assets | $ | 89,521 | ||||||||||||||
Goodwill | 148,093 | |||||||||||||||
$ | 237,614 | |||||||||||||||
Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination | The following table sets forth the preliminary components of the identifiable intangible assets acquired by asset class and their preliminary estimated useful lives as of the date of acquisition: | |||||||||||||||
Fair Value | Useful Life | |||||||||||||||
Physician network | $ | 104,500 | 14 years | |||||||||||||
Drug information content | 10,000 | 5 years | ||||||||||||||
Trade name | 11,500 | 10 years | ||||||||||||||
Customer backlog | 2,900 | 1.5 years | ||||||||||||||
Epocrates non-compete agreement | 4,500 | 1.5 years | ||||||||||||||
Developed technology | 6,500 | 3 years | ||||||||||||||
Total intangible assets subject to amortization | $ | 139,900 | ||||||||||||||
Schedule of Business Acquisitions, by Acquisition | The acquisition date fair value of the consideration transferred for Epocrates, less cash and short-term investments acquired was approximately $237.6 million, which consisted of the following: | |||||||||||||||
Cash payments | $ | 294,632 | ||||||||||||||
Fair value of vested stock options and restricted stock units assumed | 13,028 | |||||||||||||||
Fair value of total consideration | 307,660 | |||||||||||||||
Less cash acquired | (51,796 | ) | ||||||||||||||
Less short-term investments acquired | (18,250 | ) | ||||||||||||||
Total | $ | 237,614 | ||||||||||||||
Business Acquisition, Schedule of Integration Costs | The following table summarizes these amounts on the condensed consolidated statements of income for the nine months ended September 30, 2013: | |||||||||||||||
Summary of roll forward of integration costs | ||||||||||||||||
Beginning balance, January 1, 2013 | $ | — | ||||||||||||||
Addition to provision | 2,209 | |||||||||||||||
Cash payments | (195 | ) | ||||||||||||||
Ending balance, March 31, 2013 | $ | 2,014 | ||||||||||||||
Addition to provision | 979 | |||||||||||||||
Change in estimate | (129 | ) | ||||||||||||||
Cash payments | (1,122 | ) | ||||||||||||||
Ending balance, June 30, 2013 | $ | 1,742 | ||||||||||||||
Addition to provision | 526 | |||||||||||||||
Change in estimate | (72 | ) | ||||||||||||||
Cash payments | (692 | ) | ||||||||||||||
Ending balance, September 30, 2013 | $ | 1,504 | ||||||||||||||
NET_INCOME_LOSS_PER_SHARE_Tabl
NET INCOME (LOSS) PER SHARE (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||
Schedule of Earnings Per Share, Basic and Diluted | The following table reconciles the weighted average shares outstanding for basic and diluted net income (loss) per share for the periods indicated: | ||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
Net income (loss) | $ | 1,170 | $ | 6,210 | $ | (10,551 | ) | $ | 12,792 | ||||||||
Weighted average shares used in computing basic net income (loss) per share | 36,970 | 35,832 | 36,722 | 35,847 | |||||||||||||
Net income (loss) per share – Basic | $ | 0.03 | $ | 0.17 | $ | (0.29 | ) | $ | 0.36 | ||||||||
Net income (loss) | $ | 1,170 | $ | 6,210 | $ | (10,551 | ) | $ | 12,792 | ||||||||
Weighted average shares used in computing basic net income (loss) per share | 36,970 | 35,832 | 36,722 | 35,847 | |||||||||||||
Effect of dilutive securities | 1,373 | 1,380 | — | 1,191 | |||||||||||||
Weighted average shares used in computing diluted net income (loss) per share | 38,343 | 37,212 | 36,722 | 37,038 | |||||||||||||
Net income (loss) per share – Diluted | $ | 0.03 | $ | 0.17 | $ | (0.29 | ) | $ | 0.35 | ||||||||
FAIR_VALUE_OF_FINANCIAL_INSTRU1
FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following table presents information about our financial assets and liabilities that are measured at fair value on a recurring basis as of September 30, 2013, and December 31, 2012, and indicates the fair value hierarchy of the valuation techniques we utilized to determine such fair value. In general, fair values determined by Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities and fair values determined by Level 2 inputs utilize quoted prices (unadjusted) in active markets for similar assets or liabilities. The fair values determined by Level 3 inputs are unobservable values which are supported by little or no market activity. | ||||||||||||||||
Fair Value Measurements At September 30, 2013, Using | |||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Cash and cash equivalents: | |||||||||||||||||
Money market funds | $ | 37 | $ | — | $ | — | $ | 37 | |||||||||
Total assets | $ | 37 | $ | — | $ | — | $ | 37 | |||||||||
Interest rate swap liability | $ | — | $ | (390 | ) | $ | — | $ | (390 | ) | |||||||
Total liabilities | $ | — | $ | (390 | ) | $ | — | $ | (390 | ) | |||||||
Fair Value Measurements as of December 31, 2012, Using | |||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Cash and cash equivalents: | |||||||||||||||||
Money market funds | $ | 89,480 | $ | — | $ | — | $ | 89,480 | |||||||||
Available-for-sale investments: | |||||||||||||||||
Commercial paper | — | 11,748 | — | 11,748 | |||||||||||||
Corporate bonds | — | 20,334 | — | 20,334 | |||||||||||||
Certificate of deposit | — | 6,010 | — | 6,010 | |||||||||||||
Total assets | $ | 89,480 | $ | 38,092 | $ | — | $ | 127,572 | |||||||||
Accrued contingent consideration | $ | — | $ | — | $ | (448 | ) | $ | (448 | ) | |||||||
Total liabilities | $ | — | $ | — | $ | (448 | ) | $ | (448 | ) | |||||||
Reconciliations for Fair Values of Financial Instruments Determined by Level 3 | The reconciliations for the fair values of financial instruments determined by Level 3 inputs for the periods presented are as follows: | ||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
Balance, beginning of period | $ | 448 | $ | 6,259 | $ | 448 | $ | 8,176 | |||||||||
Payments | (524 | ) | (1,843 | ) | (524 | ) | (2,650 | ) | |||||||||
Change in fair value (included in general and administrative expenses) | 76 | (3,675 | ) | 76 | (4,785 | ) | |||||||||||
Balance, end of period | $ | — | $ | 741 | $ | — | $ | 741 | |||||||||
PROPERTY_AND_EQUIPMENT_Tables
PROPERTY AND EQUIPMENT (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Property, Plant and Equipment [Abstract] | |||||||||
Property, and Equipment | Property and equipment consist of the following as of: | ||||||||
September 30, 2013 | December 31, 2012 | ||||||||
Equipment | $ | 74,358 | $ | 56,078 | |||||
Furniture and fixtures | 7,709 | 5,297 | |||||||
Leasehold improvements | 2,756 | 15,518 | |||||||
Airplane | 3,156 | 3,156 | |||||||
Building | 136,181 | 14,644 | |||||||
Building improvements | 18,281 | 3,500 | |||||||
Land | 23,059 | 2,035 | |||||||
Land improvements | 2,735 | 915 | |||||||
Total property and equipment, at cost | 268,235 | 101,143 | |||||||
Accumulated depreciation and amortization | (68,156 | ) | (49,902 | ) | |||||
Construction in progress | 3,559 | 2,794 | |||||||
Property and equipment, net | $ | 203,638 | $ | 54,035 | |||||
DEBT_Tables
DEBT (Tables) | 9 Months Ended | ||||||||||||||
Sep. 30, 2013 | |||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||
Schedule of Maturities of Long-term Debt | Future principle payments of the unsecured term loan facility at September 30, 2013 are as follows: | ||||||||||||||
Amount | |||||||||||||||
Remaining 2013 | $ | 3,750 | |||||||||||||
2014 | 15,000 | ||||||||||||||
2015 | 15,000 | ||||||||||||||
2016 | 15,000 | ||||||||||||||
2017 | 15,000 | ||||||||||||||
Thereafter | 128,750 | ||||||||||||||
Total | 192,500 | ||||||||||||||
Less current portion | 15,000 | ||||||||||||||
Long-term portion | $ | 177,500 | |||||||||||||
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | The fair value of the interest rate swap recognized in other long-term liabilities and in OCI is as follows (in thousands): | ||||||||||||||
Fair Value | |||||||||||||||
Effective Date | Notional Amount | Fixed Rate | Maturity | 30-Sep-13 | 31-Dec-12 | ||||||||||
August 31, 2013 | 120,000 | 0.8396 | % | August 31, 2016 | $ | (390 | ) | $ | — | ||||||
BASIS_OF_PRESENTATION_Addition
BASIS OF PRESENTATION (Additional Information) (Detail) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended |
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 |
Segment | Segment | ||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Number of operating segments | 2 | 1 | |
Total related party expense | $0.40 | ||
Total amount payable to related parties | $0.10 | $0.10 |
ACQUISITIONS_Additional_Inform
ACQUISITIONS (Additional Information) (Details) (USD $) | 0 Months Ended | 5 Months Ended | 9 Months Ended | 33 Months Ended | 0 Months Ended | 2 Months Ended | 5 Months Ended | 7 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 33 Months Ended | |
10-May-13 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Mar. 12, 2013 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | |
Arsenal on the Charles | Arsenal on the Charles | Arsenal on the Charles | Arsenal on the Charles | Arsenal on the Charles | Epocrates Inc | Epocrates Inc | Epocrates Inc | Epocrates Inc | Epocrates Inc | Epocrates Inc | Epocrates Inc | Epocrates Inc | |
acre | Direct operating expense | General and administrative | General and administrative | General and administrative | General and administrative | General and administrative | |||||||
Business Acquisition [Line Items] | |||||||||||||
Number of acres | 29 | ||||||||||||
Total | $168,500,000 | $237,614,000 | |||||||||||
Cash paid for property | 167,300,000 | 294,632,000 | |||||||||||
Revenue | 6,100,000 | 33,500,000 | |||||||||||
Net loss | -200,000 | -17,600,000 | |||||||||||
Costs associated with third party tenant revenue | 5,900,000 | ||||||||||||
Transaction costs in connection with acquisition | 2,400,000 | 3,100,000 | 0 | 2,700,000 | 3,200,000 | ||||||||
Share conversion ratio | 0.1239 | ||||||||||||
Fair value of unvested options and restricted stock awards assumed | 22,600,000 | ||||||||||||
Fair value of vested stock options and restricted stock units assumed | 13,028,000 | ||||||||||||
Unrecognized stock-based compensation expense | 9,600,000 | ||||||||||||
Stock-based compensation expense | 7,600,000 | ||||||||||||
Stock-based compensation expense related to acceleration of stock awards upon termination | 7,600,000 | ||||||||||||
Severance and retention bonuses | $4,200,000 |
ACQUISITIONS_Summary_of_Recogn
ACQUISITIONS (Summary of Recognized Amounts of Identifiable Assets Acquired and Liabilities Assumed) (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | 10-May-13 | Mar. 12, 2013 |
In Thousands, unless otherwise specified | Arsenal on the Charles | Epocrates Inc | ||
Business Acquisition [Line Items] | ||||
Prepaid expenses and other current assets | $685 | |||
Accounts receivable | 23,144 | |||
Other current and long-term assets | 3,833 | |||
Other current and long-term assets | 144,071 | 4,168 | ||
Purchased intangible assets | 25,545 | 139,900 | ||
Accrued expenses | -271 | -11,054 | ||
Deferred tax liabilities, net | -39,811 | |||
Deferred revenue | -789 | -29,400 | ||
Other long-term liabilities | -1,916 | -1,259 | ||
Total identifiable net assets | 167,325 | 89,521 | ||
Goodwill | 196,183 | 48,090 | 148,093 | |
Identifiable assets acquired and liabilities assumed, net | $237,614 |
ACQUISITIONS_Schedule_of_Ident
ACQUISITIONS (Schedule of Identifiable Intangible Assets Acquired) (Details) (USD $) | 0 Months Ended | 7 Months Ended | 0 Months Ended | 7 Months Ended | 0 Months Ended | 7 Months Ended | 0 Months Ended | 7 Months Ended | 0 Months Ended | 7 Months Ended | 0 Months Ended | 7 Months Ended | ||||
In Thousands, unless otherwise specified | 10-May-13 | 10-May-13 | 10-May-13 | Mar. 12, 2013 | Mar. 12, 2013 | Sep. 30, 2013 | Mar. 12, 2013 | Sep. 30, 2013 | Mar. 12, 2013 | Sep. 30, 2013 | Mar. 12, 2013 | Sep. 30, 2013 | Mar. 12, 2013 | Sep. 30, 2013 | Mar. 12, 2013 | Sep. 30, 2013 |
Arsenal on the Charles | Arsenal on the Charles | Arsenal on the Charles | Epocrates Inc | Epocrates Inc | Epocrates Inc | Epocrates Inc | Epocrates Inc | Epocrates Inc | Epocrates Inc | Epocrates Inc | Epocrates Inc | Epocrates Inc | Epocrates Inc | Epocrates Inc | Epocrates Inc | |
Above market leases | In-place leases | Physician network | Physician network | Drug information content | Drug information content | Trade name | Trade name | Customer backlog | Customer backlog | Epocrates non-compete agreement | Epocrates non-compete agreement | Developed technology | Developed technology | |||
Acquired Finite-Lived Intangible Assets [Line Items] | ||||||||||||||||
Purchased intangible assets - net | $25,545 | $3,298 | $22,247 | $139,900 | $104,500 | $10,000 | $11,500 | $2,900 | $4,500 | $6,500 | ||||||
Weighted Average Remaining Useful Life (years) | 14 years | 5 years | 10 years | 1 year 6 months | 1 year 6 months | 3 years |
ACQUISITIONS_Total_Considerati
ACQUISITIONS (Total Consideration on Acquisition Date) (Details) (Epocrates Inc, USD $) | 0 Months Ended |
In Thousands, unless otherwise specified | Mar. 12, 2013 |
Epocrates Inc | |
Business Acquisition [Line Items] | |
Cash payments | $294,632 |
Fair value of vested stock options and restricted stock units assumed | 13,028 |
Fair value of total consideration | 307,660 |
Less cash acquired | -51,796 |
Less short-term investments acquired | -18,250 |
Total | $237,614 |
ACQUISITIONS_Schedule_of_Integ
ACQUISITIONS (Schedule of Integration Costs) (Details) (Epocrates Inc, USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 |
Epocrates Inc | |||
Integration Costs [Roll Forward] | |||
Beginning balance | $1,742 | $2,014 | $0 |
Addition to provision | 526 | 979 | 2,209 |
Cash payments | -692 | -1,122 | -195 |
Change in estimate | -72 | -129 | |
Ending balance | $1,504 | $1,742 | $2,014 |
ACQUISITIONS_Schedule_of_Pro_F
ACQUISITIONS (Schedule of Pro Forma Information) (Details) (Epocrates and the Arsenal on the Charles, USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Epocrates and the Arsenal on the Charles | ||||
Business Acquisition [Line Items] | ||||
Revenue | $151,527 | $132,833 | $443,196 | $390,673 |
Net income (loss) | $1,170 | $982 | ($14,953) | ($9,101) |
Net income (loss) per share – Basic | $0.03 | $0.03 | ($0.41) | ($0.25) |
Net income (loss) per share – Diluted | $0.03 | $0.03 | ($0.41) | ($0.24) |
NET_INCOME_LOSS_PER_SHARE_Reco
NET INCOME (LOSS) PER SHARE (Reconciliation of Weighted Average Shares Outstanding for Basic and Diluted Net Income Per Share) (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Earnings Per Share [Abstract] | ||||
Net income (loss) | $1,170 | $6,210 | ($10,551) | $12,792 |
Weighted average shares used in computing basic net income per share (shares) | 36,970 | 35,832 | 36,722 | 35,847 |
Net income (loss) per share - basic (in dollars per share) | $0.03 | $0.17 | ($0.29) | $0.36 |
Effect of dilutive securities (shares) | 1,373 | 1,380 | 0 | 1,191 |
Weighted average shares used in computing diluted net income per share (shares) | 38,343 | 37,212 | 36,722 | 37,038 |
Net income (loss) per share - diluted (in dollars per share) | $0.03 | $0.17 | ($0.29) | $0.35 |
NET_INCOME_LOSS_PER_SHARE_Net_
NET INCOME (LOSS) PER SHARE (Net Income Per Share - Additional Information) (Detail) | 3 Months Ended | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Earnings Per Share [Abstract] | ||||
Options and restricted stock units which have an antidilutive effect (shares) | 0.3 | 0.4 | 3.5 | 0.4 |
FAIR_VALUE_OF_FINANCIAL_INSTRU2
FAIR VALUE OF FINANCIAL INSTRUMENTS (Fair Value of Financial Instruments - Additional Information) (Detail) (USD $) | 9 Months Ended | 1 Months Ended | 3 Months Ended | 3 Months Ended | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Dec. 31, 2011 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | 10-May-13 | Sep. 30, 2013 | 10-May-13 | |
Level 2 | Level 2 | Proxsys LLC | Proxsys LLC | Proxsys LLC | Proxsys LLC | Proxsys LLC | Proxsys LLC | Proxsys LLC | Proxsys LLC | Proxsys LLC | Money market funds | Money market funds | Unsecured Debt | Unsecured Debt | Revolving Credit Facility | Revolving Credit Facility | |||||
Interest Rate Swap | Interest Rate Swap | Contingent Consideration | Second Potential Contingent Consideration | Second Potential Contingent Consideration | Second Potential Contingent Consideration | Second Potential Contingent Consideration | Second Potential Contingent Consideration | Second Potential Contingent Consideration | Final Potential Contingent Consideration | Final Potential Contingent Consideration | Senior Credit Facility | Senior Credit Facility | Senior Credit Facility | Senior Credit Facility | |||||||
Fair Value, Measurements, Recurring | Fair Value, Measurements, Recurring | Level 3 | Base Case Scenario | Base Case Scenario | Upside and Downside Senario | Upside and Downside Senario | General and administrative | General and administrative | |||||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||||||||||||||||||||
Cash and cash equivalents | $62,274,000 | $112,314,000 | $154,988,000 | $57,781,000 | $100,000 | $59,400,000 | |||||||||||||||
Amount outstanding for debt obligations | 192,500,000 | 200,000,000 | 50,000,000 | 50,000,000 | |||||||||||||||||
Amount outstanding for debt obligations | 0 | ||||||||||||||||||||
Long-term U.S. government backed securities | 0 | ||||||||||||||||||||
Fair value of swap recognized | 400,000 | 0 | |||||||||||||||||||
Outstanding potential contingent consideration, lower range | 0 | 0 | |||||||||||||||||||
Outstanding potential contigent consideration, higher range | 5,000,000 | 5,000,000 | |||||||||||||||||||
Contingent consideration, payment date | Third quarter of 2013 | ||||||||||||||||||||
Contingent consideration, assumptions, probability adjusted level | 60.00% | 60.00% | 20.00% | 20.00% | |||||||||||||||||
Accrued liability for the estimated fair value of contingent considerations | 400,000 | ||||||||||||||||||||
Contingent consideration, payment based on final selling results | 76,000 | -4,785,000 | 100,000 | 100,000 | |||||||||||||||||
Contingent consideration, amount paid | $500,000 |
FAIR_VALUE_OF_FINANCIAL_INSTRU3
FAIR VALUE OF FINANCIAL INSTRUMENTS (Financial Assets and Liabilities that Are Measured at Fair Value on Recurring Basis) (Detail) (Fair Value, Measurements, Recurring, USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets | $37 | $127,572 |
Interest rate swap liability | -390 | |
Total liabilities | -390 | -448 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets | 37 | 89,480 |
Interest rate swap liability | ||
Total liabilities | ||
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets | 38,092 | |
Interest rate swap liability | -390 | |
Total liabilities | -390 | |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets | ||
Interest rate swap liability | ||
Total liabilities | -448 | |
Contingent Consideration | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Accrued contingent consideration | -448 | |
Contingent Consideration | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Accrued contingent consideration | ||
Contingent Consideration | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Accrued contingent consideration | ||
Contingent Consideration | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Accrued contingent consideration | -448 | |
Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and cash equivalents: | 37 | 89,480 |
Money market funds | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and cash equivalents: | 37 | 89,480 |
Money market funds | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and cash equivalents: | ||
Money market funds | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and cash equivalents: | ||
Commercial paper | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale investments: | 11,748 | |
Commercial paper | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale investments: | ||
Commercial paper | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale investments: | 11,748 | |
Commercial paper | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale investments: | ||
Corporate bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale investments: | 20,334 | |
Corporate bonds | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale investments: | ||
Corporate bonds | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale investments: | 20,334 | |
Corporate bonds | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale investments: | ||
Certificate of deposit | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale investments: | 6,010 | |
Certificate of deposit | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale investments: | ||
Certificate of deposit | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale investments: | 6,010 | |
Certificate of deposit | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale investments: |
FAIR_VALUE_OF_FINANCIAL_INSTRU4
FAIR VALUE OF FINANCIAL INSTRUMENTS (Reconciliations for Fair Values of Financial Instruments Determined by Level 3) (Detail) (Contingent Consideration, USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Contingent Consideration | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Balance beginning of period | $448 | $6,259 | $448 | $8,176 |
Payments | -524 | -1,843 | -524 | -2,650 |
Change in fair value (included in general and administrative expenses) | 76 | -3,675 | 76 | -4,785 |
Balance end of period | $0 | $741 | $0 | $741 |
PROPERTY_AND_EQUIPMENT_Details
PROPERTY AND EQUIPMENT (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | |
Property, Plant and Equipment [Line Items] | |||||
Total property and equipment, at cost | $268,235,000 | $268,235,000 | $101,143,000 | ||
Accumulated depreciation and amortization | -68,156,000 | -68,156,000 | -49,902,000 | ||
Construction in progress | 3,559,000 | 3,559,000 | 2,794,000 | ||
Property and equipment - net | 203,638,000 | 203,638,000 | 54,035,000 | ||
Depreciation expense | 6,600,000 | 4,500,000 | 18,300,000 | 12,200,000 | |
Equipment | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property and equipment, at cost | 74,358,000 | 74,358,000 | 56,078,000 | ||
Furniture and fixtures | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property and equipment, at cost | 7,709,000 | 7,709,000 | 5,297,000 | ||
Leasehold improvements | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property and equipment, at cost | 2,756,000 | 2,756,000 | 15,518,000 | ||
Airplane | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property and equipment, at cost | 3,156,000 | 3,156,000 | 3,156,000 | ||
Building | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property and equipment, at cost | 136,181,000 | 136,181,000 | 14,644,000 | ||
Building improvements | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property and equipment, at cost | 18,281,000 | 18,281,000 | 3,500,000 | ||
Land | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property and equipment, at cost | 23,059,000 | 23,059,000 | 2,035,000 | ||
Land improvements | |||||
Property, Plant and Equipment [Line Items] | |||||
Total property and equipment, at cost | 2,735,000 | 2,735,000 | 915,000 | ||
Arsenal on the Charles | |||||
Property, Plant and Equipment [Line Items] | |||||
Fair value of buildings acquired | 121,300,000 | 121,300,000 | |||
Fair value of land acquired | 21,000,000 | 21,000,000 | |||
Fair value of land improvements acquired | $1,800,000 | $1,800,000 |
DEBT_Additional_Information_De
DEBT (Additional Information) (Detail) (USD $) | 9 Months Ended | 0 Months Ended | 0 Months Ended | 9 Months Ended | 0 Months Ended | 3 Months Ended | ||||||
Sep. 30, 2013 | Sep. 30, 2012 | 10-May-13 | 10-May-13 | Sep. 30, 2013 | 10-May-13 | Sep. 30, 2013 | Sep. 30, 2013 | Jan. 07, 2013 | Oct. 20, 2011 | Sep. 30, 2013 | Mar. 10, 2013 | |
Senior Credit Facility | Senior Credit Facility | Senior Credit Facility | Senior Credit Facility | Senior Credit Facility | Senior Credit Facility | Revolving Credit Agreement | Revolving Credit Agreement | Revolving Credit Agreement | Revolving Credit Agreement | |||
Unsecured Debt | Unsecured Debt | Revolving Credit Facility | Revolving Credit Facility | Senior Notes | ||||||||
Debt Instrument [Line Items] | ||||||||||||
Revolving credit agreement | $100,000,000 | |||||||||||
Line of credit, term | 5 years | |||||||||||
Interest rate plus Federal Funds rate | 0.50% | |||||||||||
Interest rate plus one month LIBOR | 1.00% | |||||||||||
Amount of additional borrowing capacity for credit facility | 100,000,000 | 55,000,000 | ||||||||||
Financing fees | 1,300,000 | 0 | ||||||||||
Amount outstanding for debt obligations | 200,000,000 | 192,500,000 | 50,000,000 | 50,000,000 | 155,000,000 | |||||||
Payments on line of credit | 105,000,000 | 0 | 50,000,000 | |||||||||
Credit Agreement, amount | 325,000,000 | 200,000,000 | 125,000,000 | |||||||||
Amount payable each quarter | 3,750,000 | |||||||||||
Available on unsecured revolving credit facility | $75,000,000 | |||||||||||
Interest rate for Credit Facility | 1.93% |
DEBT_Schedule_of_Future_Paymen
DEBT (Schedule of Future Payments of Long Term Debt) (Details) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Line of Credit Facility [Line Items] | ||
Current portion of long-term debt | $15,000 | $0 |
Long-term debt, net of current portion | 177,500 | 0 |
Senior Credit Facility | Unsecured Debt | ||
Line of Credit Facility [Line Items] | ||
Remaining 2013 | 3,750 | |
2014 | 15,000 | |
2015 | 15,000 | |
2016 | 15,000 | |
2017 | 15,000 | |
Thereafter | 128,750 | |
Total | 192,500 | |
Current portion of long-term debt | 15,000 | |
Long-term debt, net of current portion | $177,500 |
DEBT_Interest_Rate_Swap_Agreem
DEBT (Interest Rate Swap Agreement) (Details) (Interest Rate Swap, Designated as Hedging Instrument, USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Derivatives, Fair Value [Line Items] | ||
Notional Amount | $120,000,000 | |
Fixed Rate | 0.84% | |
Other Long Term Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Fair value of swap recognized | ($390,000) | $0 |
COMMITMENTS_AND_CONTINGENCIES_
COMMITMENTS AND CONTINGENCIES (Additional Information) (Detail) (Bushansky v Epocrates Inc, et al, USD $) | 0 Months Ended |
In Thousands, unless otherwise specified | Oct. 04, 2013 |
Bushansky v Epocrates Inc, et al | |
Loss Contingencies [Line Items] | |
Amount of final settlement approval | $335 |