Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Sep. 30, 2013 | Nov. 01, 2013 | |
Document Documentand 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 | 'PODD | ' |
Entity Registrant Name | 'INSULET CORP | ' |
Entity Central Index Key | '0001145197 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Large Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 54,539,340 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Current Assets | ' | ' |
Cash and cash equivalents | $153,905 | $57,293 |
Accounts receivable, net | 34,465 | 33,294 |
Inventories | 5,395 | 14,867 |
Prepaid expenses and other current assets | 5,921 | 4,482 |
Total current assets | 199,686 | 109,936 |
Property and equipment, net | 31,399 | 25,422 |
Intangible assets, net | 19,154 | 22,963 |
Goodwill | 37,536 | 37,536 |
Other assets | 1,721 | 2,202 |
Total assets | 289,496 | 198,059 |
Current Liabilities | ' | ' |
Accounts payable | 15,117 | 9,361 |
Accrued expenses and other current liabilities | 30,017 | 19,051 |
Deferred revenue | 567 | 5,445 |
Current portion of capital lease obligations | 2,593 | 0 |
Current portion of long-term debt | 0 | 14,429 |
Total current liabilities | 48,294 | 48,286 |
Capital lease obligations | 6,092 | 0 |
Long-term debt | 111,117 | 103,730 |
Other long-term liabilities | 2,567 | 1,867 |
Total liabilities | 168,070 | 153,883 |
Commitments and Contingencies (Note 11) | ' | ' |
Stockholders’ Equity | ' | ' |
Preferred stock, $.001 par value: Authorized: 5,000,000 shares at September 30, 2013 and December 31, 2012 Issued and outstanding: zero shares at Septemeber 30, 2013 and December 31, 2012 | 0 | 0 |
Common stock, $.001 par value: Authorized: 100,000,000 shares at September 30, 2013 and December 31, 2012. Issued and outstanding: 54,521,310 and 48,359,063 shares at September 30, 2013 and December 31, 2012, respectively | 55 | 48 |
Additional paid-in capital | 645,396 | 525,679 |
Accumulated deficit | -524,025 | -481,551 |
Total stockholders’ equity | 121,426 | 44,176 |
Total liabilities and stockholders’ equity | $289,496 | $198,059 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Statement of Financial Position [Abstract] | ' | ' |
Preferred stock, par value (in USD per share) | $0.00 | $0.00 |
Preferred stock, authorized | 5,000,000 | 5,000,000 |
Preferred stock, issued | 0 | 0 |
Preferred stock, outstanding | 0 | 0 |
Common stock, par value (in USD per share) | $0.00 | $0.00 |
Common stock, authorized | 100,000,000 | 100,000,000 |
Common stock, issued | 54,521,310 | 48,359,063 |
Common stock, outstanding | 54,521,310 | 48,359,063 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Income Statement [Abstract] | ' | ' | ' | ' |
Revenue | $61,103 | $54,752 | $178,551 | $153,541 |
Cost of revenue | 33,708 | 30,362 | 99,168 | 86,524 |
Gross profit | 27,395 | 24,390 | 79,383 | 67,017 |
Operating expenses: | ' | ' | ' | ' |
Research and development | 5,771 | 6,559 | 15,341 | 18,512 |
General and administrative | 23,530 | 12,731 | 50,525 | 38,416 |
Sales and marketing | 15,407 | 13,571 | 42,858 | 39,974 |
Total operating expenses | 44,708 | 32,861 | 108,724 | 96,902 |
Operating loss | -17,313 | -8,471 | -29,341 | -29,885 |
Interest income | 27 | 31 | 91 | 83 |
Interest and other expense | -3,999 | -3,949 | -12,970 | -11,728 |
Other expense, net | -3,972 | -3,918 | -12,879 | -11,645 |
Loss before income taxes | -21,285 | -12,389 | -42,220 | -41,530 |
Income tax expense | -5 | -28 | -254 | -143 |
Net loss | ($21,290) | ($12,417) | ($42,474) | ($41,673) |
Net loss per share basic and diluted | ($0.39) | ($0.26) | ($0.79) | ($0.87) |
Weighted-average number of shares used in calculating net loss per share | 54,458,364 | 48,041,392 | 53,786,974 | 47,825,136 |
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 loss | ($42,474) | ($41,673) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities | ' | ' |
Depreciation and amortization | 8,859 | 8,092 |
Non-cash interest and other expense | 8,726 | 7,556 |
Stock-based compensation expense | 9,800 | 7,500 |
Provision for bad debts | 3,942 | 2,321 |
Impairment and other charges | 2,511 | 0 |
Changes in operating assets and liabilities: | ' | ' |
Accounts receivable | -5,113 | -9,276 |
Inventories | 9,472 | -3,251 |
Deferred revenue | -4,878 | -1,444 |
Prepaid expenses and other assets | -1,401 | -1,966 |
Accounts payable, accrued expenses and other current liabilities | 16,722 | 8,657 |
Other long-term liabilities | 700 | 18 |
Net cash provided by (used in) operating activities | 6,866 | -23,466 |
Cash flows from investing activities | ' | ' |
Purchases of property and equipment | -4,517 | -8,936 |
Net cash used in investing activities | -4,517 | -8,936 |
Cash flows from financing activities | ' | ' |
Payments for capital lease obligations | -336 | 0 |
Repayment of debt | -2,000 | 0 |
Net proceeds from issuance of common stock | 99,164 | 3,142 |
Payment of withholding taxes in connection with vesting of restricted stock units | -2,565 | -1,252 |
Net cash provided by financing activities | 94,263 | 1,890 |
Net increase (decrease) in cash and cash equivalents | 96,612 | -30,512 |
Cash and cash equivalents, beginning of period | 57,293 | 93,955 |
Cash and cash equivalents, end of period | 153,905 | 63,443 |
Common stock issued in exchange for 5.375% Convertible Senior Notes | 13,000 | 0 |
Purchases of property and equipment under capital lease | $9,021 | $0 |
Nature_of_the_Business
Nature of the Business | 9 Months Ended |
Sep. 30, 2013 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' |
Nature of the Business | ' |
Nature of the Business | |
The Company is primarily engaged in the development, manufacturing and sale of its proprietary OmniPod Insulin Management System (the “OmniPod System”), an innovative, discreet and easy-to-use insulin infusion system for people with insulin-dependent diabetes. The OmniPod System is the only commercially-available insulin infusion system of its kind. The OmniPod System features a unique disposable tubeless OmniPod which is worn on the body for approximately three days at a time and the handheld, wireless Personal Diabetes Manager (“PDM”). Conventional insulin pumps require people with insulin-dependent diabetes to learn to use, manage and wear a number of cumbersome components, including up to 42 inches of tubing. In contrast, the OmniPod System features two discreet, easy-to-use devices that eliminate the need for a bulky pump, tubing and separate blood glucose meter, provides for virtually pain-free automated cannula insertion, communicates wirelessly and integrates a blood glucose meter. | |
In June 2011, the Company acquired Neighborhood Holdings, Inc. and its wholly-owned subsidiaries (collectively, “Neighborhood Diabetes”) in order to support the sales of the OmniPod System, expand the Company’s full suite diabetes management product offerings and obtain access to a larger number of insulin dependent patients. Through Neighborhood Diabetes, the Company is able to provide customers with blood glucose testing supplies, traditional insulin pumps, pump supplies and pharmaceuticals and has the ability to process claims as either durable medical equipment or through pharmacy benefits. | |
The Company began commercial sale of the OmniPod System in the United States in October 2005. The Company has also expanded the availability of the OmniPod System internationally through its partnership with Ypsomed Distribution AG (“Ypsomed”) and GlaxoSmithKline (“GSK”). In January 2010, the Company entered into a distribution agreement with Ypsomed pursuant to which Ypsomed became the exclusive distributor of the OmniPod System in multiple countries. In February 2011, the Company entered into a distribution agreement with GSK pursuant to which GSK became the exclusive distributor of the OmniPod System in Canada. | |
In August 2011, the Company received CE Mark approval, and in December 2012 the Company received 510(k) clearance by the FDA for its new OmniPod System. The new OmniPod System is more than one-third smaller and one-quarter lighter than the original model, while maintaining the same features and operating capabilities. The Company began selling the new OmniPod System in certain countries in Europe through Ypsomed in 2012. The Company began selling the new OmniPod System to new customers in the U.S. during the first quarter of 2013 and began converting the existing customer base in the second quarter of 2013. By the end of the third quarter, the Company completely transitioned its production to the new OmniPod System. |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 9 Months Ended | |
Sep. 30, 2013 | ||
Accounting Policies [Abstract] | ' | |
Summary of Significant Accounting Policies | ' | |
Summary of Significant Accounting Policies | ||
Basis of Presentation | ||
The unaudited consolidated financial statements in this Quarterly Report on Form 10-Q have been prepared in accordance with generally accepted accounting principles (“GAAP”) for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, these unaudited consolidated financial statements do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments, consisting of normal recurring adjustments, considered necessary for a fair presentation have been included. Operating results for the three and nine month periods ended September 30, 2013, are not necessarily indicative of the results that may be expected for the full year ending December 31, 2013, or for any other subsequent interim period. | ||
The unaudited consolidated financial statements in this Quarterly Report on Form 10-Q should be read in conjunction with the Company’s consolidated financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012. | ||
Use of Estimates in Preparation of Financial Statements | ||
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect 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 expense during the reporting periods. The most significant estimates used in these financial statements include the valuation of stock-based compensation expense, accounts receivable, inventories, goodwill, deferred revenue and equity instruments, the lives of property and equipment and intangible assets, as well as warranty and doubtful accounts allowance reserve calculations. Actual results may differ from those estimates. | ||
Principles of Consolidation | ||
The unaudited consolidated financial statements in this Quarterly Report on Form 10-Q include the accounts of the Company and its wholly-owned subsidiaries. All material intercompany balances and transactions have been eliminated in consolidation. | ||
Fair Value Measurements | ||
The Company adopted the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 820, Fair Value Measurements and Disclosures (“ASC 820”) related to the fair value measurement of certain of its assets and liabilities. ASC 820 defines fair value as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also describes three levels of inputs that may be used to measure the fair value: | ||
Level 1 — quoted prices in active markets for identical assets or liabilities | ||
Level 2 — observable inputs other than quoted prices in active markets for identical assets or liabilities | ||
Level 3 — unobservable inputs in which there is little or no market data available, which require the reporting entity to develop its own assumptions | ||
The only assets and liabilities subject to fair value measurement standards at September 30, 2013 and December 31, 2012 are cash equivalents, including money market accounts, and long-term obligations which are based on Level 1 inputs. | ||
Certain of the Company’s financial instruments, including cash and cash equivalents, accounts receivable, accounts payable, accrued expenses and other liabilities are carried at cost, which approximates their fair value because of the short-term maturity of these financial instruments. Based on the borrowing rates currently available to the Company for loans with similar terms, the carrying value of the Company’s long-term debt and capital lease obligations approximates their fair values. | ||
Accounts Receivable and Allowance for Doubtful Accounts | ||
Accounts receivable consist of amounts due from third-party payors, patients, third-party distributors, and government agencies. The allowance for doubtful accounts is recorded at the time collection risk is identified. The Company estimates its allowance based on historical experience, assessment of specific risk, discussions with individual customers and various assumptions and estimates that are believed to be reasonable under the circumstances. | ||
Inventories | ||
Inventories are held at the lower of cost or market, determined under the first-in, first-out method. Inventory has been recorded at cost as of September 30, 2013 and December 31, 2012. Work in process is calculated based upon a build up in the stage of completion using estimated labor inputs for each stage in production. The Company periodically reviews inventories for potential impairment based on quantities on hand and expectations of future use. | ||
Property and Equipment | ||
Property and equipment is stated at cost and depreciated using the straight-line method over the estimated useful life of the respective assets. Leasehold improvements are amortized over their useful life or the life of the lease, whichever is shorter. Assets acquired under capital leases are amortized in accordance with the respective class of owned assets or life of the lease and the amortization is included with depreciation expense. Maintenance and repair costs are expensed as incurred. In the three and nine month periods ended September 30, 2013 in connection with the transition to the new OmniPod System, the Company recorded a $2.5 million charge to expense the value of manufacturing equipment that was no longer expected to be used in its manufacturing process. | ||
Intangibles and Other Long-Lived Assets | ||
The Company’s finite-lived intangible assets are stated at cost less accumulated amortization. The Company assesses its intangible and other long-lived assets for impairment whenever events or changes in circumstances suggest that the carrying value of an asset may not be recoverable. The Company recognizes an impairment loss for intangibles and other long-lived assets if the carrying amount of the asset is not recoverable based on its undiscounted future cash flows. Any such impairment loss is measured as the difference between the carrying amount and the fair value of the asset. The estimation of useful lives and expected cash flows requires the Company to make significant judgments regarding future periods that are subject to some factors outside its control. Changes in these estimates can result in significant revisions to the carrying value of these assets and may result in material charges to the results of operations. The estimated life of the acquired tradename asset is 15 years. The estimated life of the acquired customer relationship asset is 10 years. Intangible assets with determinable estimated lives are amortized over these lives. At September 30, 2013, intangible assets consisted of $16.8 million of customer relationships and $2.4 million of tradenames. | ||
Goodwill | ||
Goodwill represents the excess of the cost of the acquired Neighborhood Diabetes businesses over the fair value of identifiable net assets acquired. The Company performs an assessment of its goodwill for impairment on at least an annual basis or whenever events or changes in circumstances indicate there might be impairment. | ||
Goodwill is evaluated at the reporting unit level. To test for impairment, the Company compares the carrying value of the reporting unit to its fair value using a discounted cash flow analysis. If the reporting unit’s carrying value exceeds its fair value, the Company would record an impairment loss to the extent that the carrying value of goodwill exceeds its implied fair value. | ||
Warranty | ||
The Company provides a four-year warranty on its PDMs and may replace any OmniPods that do not function in accordance with product specifications. The Company estimates its warranty reserves at the time the product is shipped based on historical experience and the estimated cost to service the claims. Cost to service the claims reflects the current product cost, which has been decreasing over time. As these estimates are based on historical experience, and the Company continues to introduce new versions of existing products, the Company also considers the anticipated performance of the product over its warranty period in estimating warranty reserves. | ||
Revenue Recognition | ||
The Company generates nearly all of its revenue from sales of its OmniPod System and other diabetes related products including blood glucose testing supplies, traditional insulin pumps, pump supplies and pharmaceuticals to customers and third-party distributors who resell the products to patients with diabetes. | ||
Revenue recognition requires that persuasive evidence of a sales arrangement exists, delivery of goods occurs through transfer of title and risk and rewards of ownership, the selling price is fixed or determinable and collectability is reasonably assured. With respect to these criteria: | ||
• | The evidence of an arrangement generally consists of a physician order form, a patient information form and, if applicable, third-party insurance approval for sales directly to patients or a purchase order for sales to a third-party distributor. | |
• | Transfer of title and risk and rewards of ownership are passed to the patient or third-party distributor upon shipment of the products. | |
• | The selling prices for all sales are fixed and agreed with the patient or third-party distributor and, if applicable, the patient’s third-party insurance provider(s), prior to shipment and are based on established list prices or, in the case of certain third-party insurers, contractually agreed upon prices. Provisions for discounts and rebates to customers are established as a reduction to revenue in the same period the related sales are recorded. | |
The Company offers a 45-day right of return for its OmniPod System sales to new patients, and defers revenue to reflect estimated sales returns in the same period that the related product sales are recorded. Returns are estimated through a comparison of the Company’s historical return data to their related sales. Historical rates of return are adjusted for known or expected changes in the marketplace when appropriate. When doubt exists about reasonable assuredness of collectability from specific customers, the Company defers revenue from sales of products to those customers until payment is received. | ||
In June 2011, the Company entered into a development agreement with a U.S. based pharmaceutical company (the “Development Agreement”). Under the Development Agreement, the Company is required to perform design, development, regulatory and other services to support the pharmaceutical company as it works to obtain regulatory approval to use the Company’s drug delivery technology as a delivery method for its pharmaceutical. Over the term of the Development Agreement, the Company has and will continue to invoice amounts based upon meeting certain deliverable milestones. Revenue from the Development Agreement is recognized using a proportional performance methodology based on efforts incurred and total payments under the agreement. The impact of changes in the expected total effort or contract payments are recognized as a change in estimate using the cumulative catch-up method. | ||
The Company deferred revenue of $0.6 million and $5.4 million as of September 30, 2013 and December 31, 2012, respectively. The deferred revenue recorded was comprised of product-related revenue and unrecognized amounts related to the Development Agreement. | ||
Concentration of Credit Risk | ||
Financial instruments that subject the Company to credit risk primarily consist of cash and cash equivalents. The Company maintains the majority of its cash with two accredited financial institutions. | ||
The Company purchases complete OmniPods from Flextronics International Ltd., its single source supplier. As of September 30, 2013 and December 31, 2012, liabilities to one vendor represented approximately 26% and 19% of the combined balance of accounts payable, accrued expenses, and other current liabilities, respectively. | ||
Segment Reporting | ||
Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated on a regular basis by the chief operating decision-maker, or decision-making group, in deciding how to allocate resources to an individual segment and in assessing performance of the segment. The Company’s current product offering consists of diabetes supplies, including the OmniPod System as well as other diabetes related products and supplies such as blood glucose testing supplies, traditional insulin pumps, pump supplies and pharmaceuticals. The Company’s current product offering is marketed to a single customer type, people with diabetes. As the Company sells a single product type, management operates the business as a single entity. | ||
Income Taxes | ||
Deferred tax assets and liabilities are determined based on differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates that will be in effect in the years in which the differences are expected to reverse. A valuation allowance is required to reduce the deferred tax assets reported if, based on the weight of the evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The Company reviews its deferred tax assets for recoverability considering historical profitability, projected future taxable income, and the expected timing of the reversals of existing temporary differences and tax planning strategies. | ||
The Company follows the provisions of FASB ASC 740-10, Income Taxes (“ASC 740-10”) on the accounting for uncertainty in income taxes recognized in its financial statements. ASC 740-10 prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. In addition, ASC 740-10 provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, and disclosure and transition. The Company recognizes estimated interest and penalties for uncertain tax positions in income tax expense. As of September 30, 2013 interest and penalties were immaterial to the consolidated financial statements. | ||
The Company files federal, state and foreign tax returns. These returns are generally open to examination by the relevant tax authorities from three to four years from the date they are filed. The tax filings relating to the Company's federal and state returns are currently open to examination for tax years 2010 through 2012 and 2009 through 2012, respectively. In addition, the Company has generated tax losses since its inception in 2000. These years may be subject to examination if the losses are carried forward and utilized in future years. | ||
Stock-Based Compensation | ||
The Company accounts for stock-based compensation under the provisions of FASB ASC 718-10, Compensation — Stock Compensation (“ASC 718-10”), which requires all share-based payments to employees, including grants of employee stock options, to be recognized in the income statement based on their fair values. Share-based payments that contain performance conditions are recognized when such conditions are probable of being achieved. | ||
The Company uses the Black-Scholes option pricing model to determine the weighted average fair value of options granted. The Company determines the intrinsic value of restricted stock units based on the closing price of its common stock on the date of grant. The Company recognizes the compensation expense of share-based awards on a straight-line basis for awards with only service conditions and on an accelerated method for awards with performance conditions. Compensation expense is recognized over the respective vesting periods of the awards. | ||
The determination of the fair value of share-based payment awards utilizing the Black-Scholes model is affected by the stock price and a number of assumptions, including expected volatility, expected life, risk-free interest rate and expected dividends. The expected life of the awards is estimated based on the midpoint between the vesting date and the end of the contractual term. The risk-free interest rate assumption is based on observed interest rates appropriate for the terms of the awards. The dividend yield assumption is based on company history and expectation of paying no dividends. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. Stock-based compensation expense recognized in the financial statements is based on awards that are ultimately expected to vest. The Company evaluates the assumptions used to value the awards on a quarterly basis and, if factors change and different assumptions are utilized, stock-based compensation expense may differ significantly from what has been recorded in the past. If there are any modifications or cancellations of the underlying unvested securities, the Company may be required to accelerate, increase or cancel any remaining unearned stock-based compensation expense. | ||
See Footnote 12 for a summary of the stock activity under the Company’s stock-based employee compensation plan. | ||
Recent Accounting Pronouncements | ||
In July 2012, the FASB issued ASU No. 2012-2 Intangibles – Goodwill and Other (Topic 350): Testing Indefinite-Lived Intangible Assets for Impairment (“ASU No. 2012-2”). ASU No. 2012-2 gives a company the option to first assess qualitative factors to determine whether it is more-likely-than-not that the indefinite-lived intangible is impaired. Qualitative factors include related events and circumstances that could affect the significant inputs used in determining the fair value of the indefinite-lived intangible asset. The guidance is effective in fiscal years beginning after September 15, 2012. The Company adopted the guidance in the first quarter of 2013. The adoption of the guidance did not have a material impact on the Company's financial statements. |
Debt
Debt | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Debt Disclosure [Abstract] | ' | |||||||||||||||
Debt | ' | |||||||||||||||
Debt | ||||||||||||||||
The Company had outstanding convertible debt and related deferred financing costs on its consolidated balance sheet as follows (in thousands): | ||||||||||||||||
As of | ||||||||||||||||
September 30, | December 31, | |||||||||||||||
2013 | 2012 | |||||||||||||||
Principal amount of the 5.375% Convertible Senior Notes | $ | — | $ | 15,000 | ||||||||||||
Principal amount of the 3.75% Convertible Senior Notes | 143,750 | 143,750 | ||||||||||||||
Unamortized discount | (32,633 | ) | (40,591 | ) | ||||||||||||
Total long-term debt | 111,117 | 118,159 | ||||||||||||||
Current portion of debt | — | 14,429 | ||||||||||||||
Long-term debt | $ | 111,117 | $ | 103,730 | ||||||||||||
Deferred financing costs | $ | 1,560 | $ | 2,004 | ||||||||||||
Interest and other expense related to the 5.375% Notes (as defined below) and the 3.75% Notes (as defined below) was included in interest and other expense on the consolidated statements of operations as follows (in thousands): | ||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Contractual coupon interest | $ | 1,347 | $ | 1,549 | $ | 4,356 | $ | 4,647 | ||||||||
Accretion of debt discount | 2,447 | 2,420 | 7,958 | 7,111 | ||||||||||||
Loss on debt extinguishment | — | — | 325 | — | ||||||||||||
Amortization of debt issuance costs | 146 | 148 | 443 | 445 | ||||||||||||
Total interest and other expense | $ | 3,940 | $ | 4,117 | $ | 13,082 | $ | 12,203 | ||||||||
5.375% Convertible Senior Notes | ||||||||||||||||
In June 2008, the Company sold $85 million in principal amount of 5.375% Convertible Senior Notes due June 15, 2013 (the “5.375% Notes”) in a private placement to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended. The interest rate on the notes was 5.375% per annum on the principal amount from June 16, 2008, payable semi-annually in arrears in cash on December 15 and June 15 of each year. The 5.375% Notes were convertible into the Company’s common stock at an initial conversion rate of 46.8467 shares of common stock per $1,000 principal amount of the 5.375% Notes, which is equivalent to a conversion price of approximately $21.35 per share, representing a conversion premium of 34% to the last reported sale price of the Company’s common stock on the NASDAQ Global Market on June 10, 2008, subject to adjustment under certain circumstances, at any time beginning on March 15, 2013 or under certain other circumstances and prior to the close of business on the business day immediately preceding the final maturity date of the notes. The 5.375% Notes were convertible for cash up to their principal amount and shares of the Company’s common stock for the remainder of the conversion value in excess of the principal amount. | ||||||||||||||||
The Company recorded a debt discount of $26.9 million to equity to reflect the value of its nonconvertible debt borrowing rate of 14.5% per annum. This debt discount was amortized as non-cash interest expense over the five year term of the 5.375% Notes. The Company incurred deferred financing costs related to this offering of approximately $3.5 million, of which $1.1 million has been reclassified as an offset to the value of the amount allocated to equity. The remainder was recorded as other assets in the consolidated balance sheet and was amortized as non-cash interest expense over the five year term of the 5.375% Notes. | ||||||||||||||||
In June 2011, in connection with the issuance of $143.8 million in principal amount of 3.75% Convertible Notes due June 15, 2016 (the “3.75% Notes”), the Company repurchased $70 million in principal amount of the 5.375% Notes for $85.1 million, a 21.5% premium on the principal amount. The investors that held the $70 million in principal amount of repurchased 5.375% Notes purchased $59.5 million in principal amount of the 3.75% Notes and retained approximately $13.5 million in principal amount of the remaining 5.375% Notes. These investors’ combined $73.0 million in principal amount of convertible debt ($13.5 million of 5.375% Notes and $59.5 million of 3.75% Notes) was considered to be a modification of a portion of the 5.375% Notes. See “3.75% Convertible Senior Notes” below for additional detail on the modification accounting. | ||||||||||||||||
In May 2013, the Company entered into an Exchange Agreement with a holder of its 5.375% Notes. Under the Exchange Agreement, the Company purchased $13 million in principal amount of the 5.375% Notes in exchange for 620,122 shares of the Company's common stock and a cash payment of $0.3 million, representing the accrued and unpaid interest. Furthermore, the Company recorded a loss on extinguishment of debt of $0.3 million which was included in interest and other expense in the nine months ended September 30, 2013. | ||||||||||||||||
In June 2013, the Company repaid the remaining outstanding principal and accrued interest on the 5.375% Notes in accordance with the terms. In addition to a cash payment of $2.1 million, representing principal and accrued and unpaid interest, the Company issued 26,523 shares of its common stock to the holders, representing the conversion value in excess of the principal amount as per the original terms of the 5.375% Notes. | ||||||||||||||||
No cash interest expense was recorded related to the 5.375% Notes in the three month period ended September 30, 2013. Cash interest expense related to the 5.375% Notes was $0.2 million in the three month period ended September 30, 2012. Cash interest expense related to the 5.375% Notes was $0.3 million and $0.6 million in the nine month periods ended September 30, 2013 and 2012, respectively. | ||||||||||||||||
As of September 30, 2013, the 5.375% Notes were repaid in full and no amounts remain on the Company's balance sheet related to these notes. | ||||||||||||||||
3.75% Convertible Senior Notes | ||||||||||||||||
In June 2011, the Company sold $143.8 million in principal amount of the 3.75% Notes. The interest rate on the notes is 3.75% per annum, payable semi-annually in arrears in cash on December 15 and June 15 of each year. The 3.75% Notes are convertible into the Company’s common stock at an initial conversion rate of 38.1749 shares of common stock per $1,000 principal amount of the 3.75% Notes, which is equivalent to a conversion price of approximately $26.20 per share, subject to adjustment under certain circumstances. The 3.75% Notes are convertible prior to March 15, 2016 only upon the occurrence of certain circumstances. On and after March 15, 2016 and prior to the close of business on the second scheduled trading day immediately preceding the final maturity date of the 3.75% Notes, the notes may be converted without regard to the occurrence of any such circumstances. The 3.75% Notes and any unpaid interest will be convertible at the Company’s option for cash, shares of the Company’s common stock or a combination of cash and shares of the Company’s common stock for the principal amount. The Company intends to settle the principal in cash. | ||||||||||||||||
The Company may not redeem the 3.75% Notes prior to June 20, 2014. From June 20, 2014 to June 20, 2015 the Company may redeem the 3.75% Notes, at its option, in whole or in part, only if the last reported sale price per share of the Company’s common stock has been at least 130% of the conversion price then in effect for at least 20 trading days during a period of 30 consecutive trading days. On and after June 20, 2015, the Company may redeem the 3.75% Notes, at its option (without regard to such sale price condition), in whole or in part. If a fundamental change, as defined in the Indenture for the 3.75% Notes, occurs at any time prior to maturity, holders of the 3.75% Notes may require the Company to repurchase their notes in whole or in part, for cash equal to 100% of the principal amount of the 3.75% Notes to be repurchased, plus accrued and unpaid interest. If a holder elects to convert its 3.75% Notes upon the occurrence of a make-whole fundamental change, as defined in the Indenture for the 3.75% Notes, the holder may be entitled to receive an additional number of shares of common stock on the conversion date. These additional shares are intended to compensate the holders for the loss of the time value of the conversion option and are set forth in the Indenture to the 3.75% Notes. In no event will the number of shares issuable upon conversion of a note exceed 50.5816 per $1,000 principal amount (subject to adjustment as described in the Indenture for the 3.75% Notes). The 3.75% Notes are unsecured. | ||||||||||||||||
The Company identified certain features related to a portion of the 3.75% Notes, including the holders’ ability to require the Company to repurchase their notes and the higher interest payments required in an event of default, which are considered embedded derivatives and should be bifurcated and accounted for at fair value. The Company assesses the value of each of these embedded derivatives at each balance sheet date. At September 30, 2013, the Company separately accounted for and determined that these derivatives had de minimus value. | ||||||||||||||||
In connection with the issuance of the 3.75% Notes, the Company repurchased $70 million in principal amount of the 5.375% Notes for $85.1 million, a 21.5% premium on the principal amount. The investors that held the $70 million in principal amount of repurchased 5.375% Notes purchased $59.5 million in principal amount of the 3.75% Notes and retained approximately $13.5 million in principal amount of the remaining 5.375% Notes. This transaction was treated as a modification of a portion of the 5.375% Notes. The Company accounted for this modification of existing debt separately from the issuance of the remainder of the 3.75% Notes. | ||||||||||||||||
Prior to the transaction, the $70 million in principal amount of repurchased 5.375% Notes had a debt discount of $10.5 million. This amount remained in debt discount related to the $73 million in principal amount of modified debt. The Company recorded additional debt discount of $15.1 million related to the premium payment in connection with the repurchase and $0.2 million related to the increase in the value of the conversion feature. The portion of the debt discount related to the value of the conversion feature was recorded as additional paid-in capital. The total debt discount of $25.8 million related to the modified debt is being amortized as non-cash interest expense at the effective rate of 16.5% over the five year term of the modified debt. The Company paid transaction fees of approximately $2.0 million related to the modification, which were recorded as interest expense at the time of the modification. | ||||||||||||||||
Of the $143.8 million in principal amount of 3.75% Notes issued in June 2011, $84.3 million in principal amount was considered to be an issuance of new debt. The Company recorded a debt discount of $26.6 million related to the $84.3 million in principal amount of 3.75% Notes. The debt discount was recorded as additional paid-in capital to reflect the value of its nonconvertible debt borrowing rate of 12.4% per annum. This debt discount is being amortized as non-cash interest expense over the five year term of the 3.75% Notes. The Company incurred deferred financing costs related to this offering of approximately $2.8 million, of which $0.9 million has been reclassified as an offset to the value of the amount allocated to equity. The remainder is recorded as other assets in the consolidated balance sheet and is being amortized as non-cash interest expense over the five year term of the 3.75% Notes. | ||||||||||||||||
Cash interest expense related to the $143.8 million in principal amount of 3.75% Notes was $1.3 million in each of the three month periods ended September 30, 2013 and 2012. Cash interest expense related to the $143.8 million in principal amount of 3.75% Notes was $4.0 million in each of the nine month periods ended September 30, 2013 and 2012. | ||||||||||||||||
As of September 30, 2013 the Company included $111.1 million on its balance sheet in long-term debt related to the 3.75% Notes. The 3.75% Notes have a remaining term of 2.75 years. |
Capital_Lease_Obligations
Capital Lease Obligations | 9 Months Ended | |||
Sep. 30, 2013 | ||||
Capital Lease Obligation [Abstract] | ' | |||
Capital Leased Assets | ' | |||
Capital Lease Obligations | ||||
In the nine months ended September 30, 2013, the Company acquired $9.0 million of manufacturing equipment under capital leases. The $9.0 million obligation under the capital leases will be repaid in equal monthly installments over the 36 month terms of the leases and includes principal and interest payments with an effective interest rate of 17% . In the third quarter of 2013, the Company recorded a $2.5 million charge to expense the value of of equipment as it was no longer expected to be used in its manufacturing process. The underlying assets have been recorded at their fair value of $6.5 million and are included in property and equipment on the Company's balance sheet as of September 30, 2013. The assets acquired under capital leases are being amortized on a straight-line basis over 5 years in accordance with the Company's policy for depreciation of manufacturing equipment. Amortization expense on assets acquired under capital leases is included with depreciation expense. | ||||
The aggregate future minimum lease payments related to these capital leases as of September 30, 2013, are as follows (in thousands): | ||||
Year Ending | Minimum Lease | |||
December 31, | Payments | |||
2013 (remaining) | 954 | |||
2014 | 3,815 | |||
2015 | 3,815 | |||
2016 | 2,409 | |||
Total | $ | 10,993 | ||
The Company recorded $0.1 million of interest expense on the capital leases in the three and nine months ended September 30, 2013. |
Net_Loss_Per_Share
Net Loss Per Share | 9 Months Ended | |||||
Sep. 30, 2013 | ||||||
Disclosure Potential Common Shares Excluded From Computation Of Diluted Net Loss Per Share [Abstract] | ' | |||||
Net Loss Per Share | ' | |||||
Net Loss Per Share | ||||||
Basic net loss per share is computed by dividing net loss by the weighted average number of common shares outstanding for the period, excluding unvested restricted common shares. Diluted net loss per share is computed using the weighted average number of common shares outstanding and, when dilutive, potential common share equivalents from options, restricted stock units and warrants (using the treasury-stock method), and potential common shares from convertible securities (using the if-converted method). Because the Company reported a net loss for the three and nine months ended September 30, 2013 and 2012, all potential common shares have been excluded from the computation of the diluted net loss per share for all periods presented, as the effect would have been anti-dilutive. Such potentially dilutive common share equivalents consist of the following: | ||||||
Three and Nine Months Ended | ||||||
September 30, | ||||||
2013 | 2012 | |||||
5.375% Convertible Senior Notes | — | 702,701 | ||||
3.75% Convertible Senior Notes | 5,487,642 | 5,487,642 | ||||
Unvested restricted stock units | 1,034,277 | 863,651 | ||||
Outstanding options | 2,130,560 | 2,693,936 | ||||
Outstanding warrants | 62,752 | 62,752 | ||||
Total dilutive common shares | 8,715,231 | 9,810,682 | ||||
Accounts_Receivable
Accounts Receivable | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Receivables [Abstract] | ' | |||||||
Accounts Receivable | ' | |||||||
Accounts Receivable | ||||||||
Accounts receivable consist of amounts due from third-party payors, patients, third-party distributors and government agencies. The Company records an allowance for doubtful accounts at the time potential collection risk is identified. The Company estimates its allowance based on historical experience, assessment of specific risk, discussions with individual customers or various assumptions and estimates that are believed to be reasonable under the circumstances. The Company believes the reserve is adequate to mitigate current collection risk. | ||||||||
As of September 30, 2013 accounts receivable from two customers represented 11% and 10% of gross accounts receivable. As of December 31, 2012 accounts receivable from two customers represented approximately 18% and 11% of gross accounts receivable, respectively. | ||||||||
The components of accounts receivable are as follows: | ||||||||
As of | ||||||||
September 30, | 31-Dec-12 | |||||||
2013 | ||||||||
(In thousands) | ||||||||
Trade receivables | $ | 41,762 | $ | 39,921 | ||||
Allowance for doubtful accounts | (7,297 | ) | (6,627 | ) | ||||
Total accounts receivable | $ | 34,465 | $ | 33,294 | ||||
Inventories
Inventories | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Disclosure Components Of Inventories [Abstract] | ' | |||||||
Inventories | ' | |||||||
Inventories | ||||||||
Inventories consist of the following: | ||||||||
As of | ||||||||
September 30, | 31-Dec-12 | |||||||
2013 | ||||||||
(In thousands) | ||||||||
Raw materials | $ | 321 | $ | 1,487 | ||||
Work-in-process | 6 | 1,595 | ||||||
Finished goods | 5,068 | 11,785 | ||||||
Total inventories | $ | 5,395 | $ | 14,867 | ||||
Other_Intangible_Assets
Other Intangible Assets | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Disclosure Components Of Other Intangible Assets [Abstract] | ' | |||||||
Other Intangible Assets | ' | |||||||
Other Intangible Assets | ||||||||
Other intangible assets consist of the following: | ||||||||
As of | ||||||||
September 30, | December 31, | |||||||
2013 | 2012 | |||||||
(In thousands) | ||||||||
Customer relationships | $ | 30,100 | $ | 30,100 | ||||
Tradename | 2,800 | 2,800 | ||||||
Total intangible assets | 32,900 | 32,900 | ||||||
Less: accumulated amortization | (13,746 | ) | (9,937 | ) | ||||
Total | $ | 19,154 | $ | 22,963 | ||||
The Company recorded $32.9 million of other intangible assets in the year ended December 31, 2011 as a result of the acquisition of Neighborhood Diabetes. The Company determined that the estimated useful life of the customer relationships asset is 10 years and is amortizing the asset over that period using an estimated cash flow pattern. The Company determined that the useful life of the Neighborhood Diabetes tradename is 15 years and is amortizing the asset over that period on a straight-line basis. Accumulated amortization on the customer relationship asset was $13.3 million and $9.6 million as of September 30, 2013 and December 31, 2012, respectively. Accumulated amortization on the tradename asset was $0.4 million and $0.3 million as of September 30, 2013 and December 31, 2012, respectively. Amortization expense was approximately $1.1 million and $1.4 million for the three months ended September 30, 2013 and 2012, respectively. Amortization expense was approximately $3.8 million and $4.6 million for the nine months ended September 30, 2013 and 2012, respectively. Amortization expense for the year ending December 31, 2013 is expected to be approximately $4.9 million. As of September 30, 2013, the weighted average amortization period of the Company’s intangible assets is approximately 8 years. | ||||||||
In April 2013, the Company was notified that Neighborhood Diabetes was not offered a contract under the Center for Medicare & Medicaid Services ("CMS") national mail-order competition of the Medicare Durable Medical Equipment, Prosthetics, Orthotics, and Supplies ("DMEPOS") Competitive Bidding Program. As of July 1, 2013, the program implementation date, the Company is no longer eligible to provide certain mail-order diabetic testing supplies such as blood glucose testing strips and lancets to Medicare beneficiaries. The Company performed an analysis of the future undiscounted cash flows of its customer relationship and tradename assets and determined that the carrying value of the assets is recoverable. No impairment of these intangible assets was recorded in the nine months ended September 30, 2013. |
Goodwill
Goodwill | 9 Months Ended |
Sep. 30, 2013 | |
Disclosure Goodwill Additional Information [Abstract] | ' |
Goodwill | ' |
Goodwill | |
The Company follows the provisions of FASB ASC Topic 350-20, Intangibles – Goodwill and Other (“ASC 350-20”). ASC 350-20 requires companies to use the purchase method of accounting for all business combinations initiated after June 30, 2001, and establishes specific criteria for the recognition of intangible assets separately from goodwill. Goodwill and indefinite-lived assets are tested for impairment at least annually. In accordance with ASC 350-20, the Company tests goodwill for impairment on an annual basis or whenever events and circumstances indicate there might be an impairment. The Company’s goodwill arose in connection with the acquisition of Neighborhood Diabetes in June 2011. No goodwill impairment was recorded in the nine months ended September 30, 2013. |
Product_Warranty_Costs
Product Warranty Costs | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Disclosure Product Warranty Liability [Abstract] | ' | |||||||||||||||
Product Warranty Costs | ' | |||||||||||||||
Product Warranty Costs | ||||||||||||||||
The Company provides a four-year warranty on its PDMs and may replace any OmniPods that do not function in accordance with product specifications. Warranty expense is estimated and recorded in the period that shipment occurs. The expense is based on the Company’s historical experience and the estimated cost to service the claims. A reconciliation of the changes in the Company’s product warranty liability is as follows: | ||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(In thousands) | ||||||||||||||||
Balance at the beginning of the period | $ | 2,401 | $ | 1,822 | $ | 1,992 | $ | 1,960 | ||||||||
Warranty expense | 1,110 | 645 | 2,771 | 1,867 | ||||||||||||
Warranty claims settled | (702 | ) | (661 | ) | (1,954 | ) | (2,021 | ) | ||||||||
Balance at the end of the period | $ | 2,809 | $ | 1,806 | $ | 2,809 | $ | 1,806 | ||||||||
As of | ||||||||||||||||
September 30, | December 31, | |||||||||||||||
2013 | 2012 | |||||||||||||||
(In thousands) | ||||||||||||||||
Composition of balance: | ||||||||||||||||
Short-term | $ | 1,047 | $ | 863 | ||||||||||||
Long-term | 1,762 | 1,129 | ||||||||||||||
$ | 2,809 | $ | 1,992 | |||||||||||||
Commitments_and_Contingencies
Commitments and Contingencies | 9 Months Ended | |||
Sep. 30, 2013 | ||||
Commitments and Contingencies Disclosure [Abstract] | ' | |||
Commitments and Contingencies | ' | |||
Commitments and Contingencies | ||||
Operating Leases | ||||
The Company leases its facilities in Massachusetts, New York, Florida, and Singapore. The Company’s leases are accounted for as operating leases. The leases generally provide for a base rent plus real estate taxes and certain operating expenses related to the leases. The Company has extended the leases of its facilities in Bedford and Billerica, Massachusetts. Following the extensions, these leases expire in September 2014. The leases for Bedford contain a five-year renewal option and escalating payments over the life of the lease. | ||||
During the year ended December 31, 2012, the Company terminated a lease for one of its corporate office spaces in Bedford, Massachusetts. The lease termination resulted in no material impact to the financial statements. During the same period, the Company entered into a new lease agreement for an additional 26,500 square feet in Bedford, Massachusetts. This lease expires in September 2014 and includes escalating payments over its term. During the nine months ended September 30, 2013, the Company extended the lease of its Woburn location. Following the extension, the lease expires in December 2014. The leases in Florida, and New York, and Singapore expire in December 2013, April 2015, and July 2015, respectively. | ||||
Certain of the Company’s operating lease agreements contain scheduled rent increases, which are being amortized over the terms of the agreements using the straight-line method and are included in other liabilities in the accompanying consolidated balance sheet. The aggregate future minimum lease payments related to these leases as of September 30, 2013, are as follows (in thousands): | ||||
Year Ending | Minimum Lease | |||
December 31, | Payments | |||
2013 (remaining) | 361 | |||
2014 | 1,134 | |||
2015 | 96 | |||
Total | $ | 1,591 | ||
Legal Proceedings | ||||
In August 2010, Becton, Dickinson and Company (“BD”), filed a lawsuit in the United States District Court in the State of New Jersey against the Company alleging that the OmniPod System infringes three of its patents. BD seeks a declaration that the Company has infringed its patents, equitable relief, including an injunction that would enjoin the Company from infringing these patents and an unspecified award for monetary damages. The Company believes that the OmniPod System does not infringe these patents. The Company expects that this litigation will not have a material adverse impact on its financial position or results of operations. The Company believes it has meritorious defenses to this lawsuit; however, litigation is inherently uncertain and there can be no assurance as to the ultimate outcome or effect of this action. The Company does not believe it has any material financial exposure with regard to this action at September 30, 2013. | ||||
In April 2013, Rydex Technologies LLC (“Rydex”), a non-practicing entity, filed a lawsuit in the United States District Court in the State of Delaware against the Company alleging that certain of its products, including the OmniPod System, infringe one of its patents. Rydex seeks a declaration that the Company has infringed its patent and an unspecified award for monetary damages. The Company believes that the OmniPod System does not infringe this patent. The Company expects that this litigation will not have a material adverse impact on its financial position or results of operations. The Company believes it has meritorious defenses to this lawsuit; however, litigation is inherently uncertain and there can be no assurance as to the ultimate outcome or effect of this action. The Company does not believe it has any material financial exposure with regard to this action at September 30, 2013. | ||||
In September 2013, the Company entered into a Settlement and Cross-License Agreement (the “Settlement Agreement”) with Medtronic MiniMed Inc., Medtronic Puerto Rico Operations Co. and MiniMed Distribution Corp. (collectively, “Medtronic”) of the lawsuit brought by Medtronic in United States District Court for the Central District of California alleging that the Company infringes certain Medtronic patents. The Settlement Agreement was entered into in full settlement of the patent infringement suit brought by Medtronic against the Company, which lawsuit was dismissed with prejudice on October 2, 2013. The Settlement Agreement provides for a one-time cash payment by the Company to Medtronic and a cross-license of certain patent claims. These licenses may generally not be assigned or sublicensed, but include “have made” licenses solely for each party's own sale of its products. Each license will terminate if the licensee is acquired by an entity in the business of manufacturing, marketing or distributing ambulatory external insulin pumps. In addition, each party agrees not to sue the other for patent infringement based on any existing product, or any feature, element or component, or any existing combination thereof, as exist in any currently existing commercially available products. The Company has recorded approximately $10 million of expense, included in general and administrative expenses on its consolidated statement of operations, related to the one-time cash payment and associated legal fees in connection with the lawsuit. | ||||
In October 2013, the Company received a letter from the Office of the Massachusetts Attorney General contending that prior to September 2012 Neighborhood Diabetes engaged in improper sales practices by automatically refilling certain prescriptions for MassHealth patients. The Company is in the process of responding to this letter, and believes that Neighborhood Diabetes’ refill practices during the period in question were appropriate and consistent with applicable laws. In light of the preliminary nature of this matter, the Company is unable to reasonably assess its ultimate outcome. However, the Company does not believe that a negative outcome is probable at September 30, 2013, nor could the Company estimate a range of possible loss. | ||||
Indemnifications | ||||
In the normal course of business, the Company enters into contracts and agreements that contain a variety of representations and warranties and provide for general indemnifications. The Company’s exposure under these agreements is unknown because it involves claims that may be made against the Company in the future, but have not yet been made. To date, the Company has not paid any claims or been required to defend any action related to its indemnification obligations. However, the Company may record charges in the future as a result of these indemnification obligations. | ||||
In accordance with its bylaws, the Company has indemnification obligations to its officers and directors for certain events or occurrences, subject to certain limits, while they are serving at the Company’s request in such capacity. There have been no claims to date, and the Company has a director and officer insurance policy that enables it to recover a portion of any amounts paid for future claims. | ||||
At September 30, 2013, the Company is subject to an on-going sales and use tax audit by the Massachusetts Department of Revenue related to Neighborhood Diabetes for a period prior to the acquisition. Under the Merger Agreement, the Company has been indemnified by the former Stockholders of Neighborhood Diabetes for any liability resulting from or related to any tax attributable to pre-acquisition periods. The Company has recorded a contingent liability in current liabilities and a corresponding indemnification asset in current assets related to the estimated sales tax payable to the state of Massachusetts for the period under audit. |
Equity
Equity | 9 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | ||||||||||||
Equity | ' | ||||||||||||
Equity | |||||||||||||
In January 2013, in a public offering, the Company issued and sold 4,715,000 shares of its common stock at a price of $20.75 per share. In connection with the offering, the Company received total gross proceeds of $97.8 million, or approximately $92.8 million in net proceeds after deducting underwriting discounts and offering expenses. | |||||||||||||
In May 2013, the Company entered into an Exchange Agreement with a holder of its 5.375% Notes. Under the Exchange Agreement, the Company issued 620,122 shares of its common stock to the holder in exchange for the extinguishment of $13 million in principal amount of the 5.375% Notes. In June 2013, in connection with the repayment of the remaining $2 million in principal amount of the 5.375% Notes, the Company issued 26,523 shares of its common stock to the holders representing the conversion value in excess of the principal amount as per the conversion terms of the 5.375% Notes. | |||||||||||||
The Company grants share-based awards to employees in the form of options to purchase the Company’s common stock, the ability to purchase stock at a discounted price under the employee stock purchase plan and restricted stock units. Stock-based compensation expense related to share-based awards recognized in the three month periods ended September 30, 2013 and 2012 was $3.0 million and $2.3 million, respectively, and was calculated based on awards ultimately expected to vest. Stock-based compensation expense related to share-based awards recognized in the nine month periods ended September 30, 2013 and 2012 was $9.8 million and $7.5 million, respectively, and was calculated based on awards ultimately expected to vest. At September 30, 2013, the Company had $26.6 million of total unrecognized compensation expense related to stock options and restricted stock units. | |||||||||||||
Stock Options | |||||||||||||
In May 2007, in conjunction with the Company's initial public offering, the Company adopted its 2007 Stock Option and Incentive Plan (the "2007 Plan"). The Company originally reserved 535,000 shares of common stock for issuance under the 2007 Plan in which the amount was increased on each January 1 through January 1, 2012 by 725,000 shares. The 2007 Plan was amended and restated in November 2008 and May 2012 to provide for the issuance of additional shares and to amend certain other provisions. In May 2012, shares available for grant under the 2007 Plan were increased by 3,775,000 shares. | |||||||||||||
The following summarizes the activity under the Company’s stock option plans: | |||||||||||||
Number of | Weighted | Aggregate | |||||||||||
Options (#) | Average | Intrinsic | |||||||||||
Exercise | Value ($) | ||||||||||||
Price ($) | |||||||||||||
(In thousands) | |||||||||||||
Balance, December 31, 2012 | 2,502,190 | $ | 13.51 | ||||||||||
Granted | 276,900 | 25.54 | |||||||||||
Exercised | (595,159 | ) | 10.3 | $ | 10,930 | (1 | ) | ||||||
Canceled | (53,371 | ) | 19.36 | ||||||||||
Balance, September 30, 2013 | 2,130,560 | $ | 15.82 | $ | 43,499 | ||||||||
Vested, September 30, 2013 | 1,302,995 | $ | 12.7 | $ | 30,676 | (2 | ) | ||||||
Vested and expected to vest, September 30, 2013 (3) | 1,827,646 | $ | 38,633 | (2 | ) | ||||||||
-1 | The aggregate intrinsic value was calculated based on the positive difference between the fair market value of the Company’s common stock as of the date of exercise and the exercise price of the underlying options. | ||||||||||||
-2 | The aggregate intrinsic value was calculated based on the positive difference between the fair market value of the Company’s common stock as of September 30, 2013 and the exercise price of the underlying options. | ||||||||||||
-3 | Represents the number of vested options as of September 30, 2013, plus the number of unvested options expected to vest as of September 30, 2013, based on the unvested options outstanding as of September 30, 2013, adjusted for the estimated forfeiture rate of 16%. | ||||||||||||
At September 30, 2013 there were 2,130,560 options outstanding with a weighted average exercise price of $15.82 per share and a weighted average remaining contractual life of 6.9 years. At September 30, 2013 there were 1,302,995 options exercisable with a weighted average exercise price of $12.70 per share and a weighted average remaining contractual life of 5.8 years. | |||||||||||||
Employee stock-based compensation expense related to stock options recognized in the three month periods ended September 30, 2013 and 2012 was $1.1 million and $1.2 million, respectively, and was based on awards ultimately expected to vest. Employee stock-based compensation expense related to stock options recognized in the nine month periods ended September 30, 2013 and 2012 was $3.6 million and $3.7 million, respectively, and was based on awards ultimately expected to vest. At September 30, 2013, the Company had $8.1 million of total unrecognized compensation expense related to stock options that will be recognized over a weighted average period of 1.2 years. | |||||||||||||
Employee Stock Purchase Plan | |||||||||||||
As of September 30, 2013 and 2012 the Company had zero shares contingently issued under the employee stock purchase plan (“ESPP”). In the three and nine months ended September 30, 2013 and 2012, the Company recorded no significant stock-based compensation charges related to the ESPP. | |||||||||||||
Restricted Stock Units | |||||||||||||
In the nine months ended September 30, 2013, the Company awarded 563,875 restricted stock units to certain employees and directors. The restricted stock units were granted under the 2007 Plan and vest annually over three to four years from the grant date. Of the 563,875 restricted stock units granted during the period, 142,000 restricted stock units were granted as performance-based awards that are probable of being achieved and vest over a three year period if certain performance criteria are met. The restricted stock units granted have a weighted average fair value of $23.93 per share based on the closing price of the Company’s common stock on the date of grant. The restricted stock units granted during the nine months ended September 30, 2013 were valued at approximately $13.5 million on their grant date, and the Company is recognizing the compensation expense over the vesting period. Approximately $1.9 million and $1.1 million of stock-based compensation expense related to the vesting of restricted stock units was recognized in the three months ended September 30, 2013 and 2012, respectively. Approximately $6.2 million and $3.8 million of stock-based compensation expense related to the vesting of restricted stock units was recognized in the nine months ended September 30, 2013 and 2012, respectively. Approximately $18.5 million of the fair value of the restricted stock units remained unrecognized as of September 30, 2013 and will be recognized over a weighted average period of 1.5 years. Under the terms of the awards, the Company will issue shares of common stock on each of the vesting dates. | |||||||||||||
The following table summarizes the status of the Company’s restricted stock units: | |||||||||||||
Number of | Weighted | ||||||||||||
Shares (#) | Average | ||||||||||||
Fair Value ($) | |||||||||||||
Balance, December 31, 2012 | 825,068 | $ | 18.4 | ||||||||||
Granted | 563,875 | 23.93 | |||||||||||
Vested | (301,241 | ) | 17.6 | ||||||||||
Forfeited | (53,425 | ) | 20.26 | ||||||||||
Balance, September 30, 2013 | 1,034,277 | $ | 21.55 | ||||||||||
Income_Taxes
Income Taxes | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Income Tax Disclosure [Abstract] | ' | |||||||||||||||
Income Taxes | ' | |||||||||||||||
Income Taxes | ||||||||||||||||
The Company accounts for income taxes under ASC 740-10. Deferred income tax assets and liabilities are determined based upon differences between financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reversed. A valuation allowance is required to reduce the deferred tax assets reported if, based on the weight of the evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. At September 30, 2013 and December 31, 2012, the Company provided a valuation allowance for the full amount of its net deferred tax asset because realization of any future tax benefit was not sufficiently assured. | ||||||||||||||||
Income tax expense (benefit) consists of the following (in thousands): | ||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Current | $ | (20 | ) | $ | 15 | $ | 171 | $ | 78 | |||||||
Deferred | 25 | 13 | 83 | 65 | ||||||||||||
Total | $ | 5 | $ | 28 | $ | 254 | $ | 143 | ||||||||
In the three and nine months ended September 30, 2013 and 2012, the current portion of income tax expense primarily relates to state, local and foreign taxes and the deferred portion primarily relates to federal and state tax amounts. | ||||||||||||||||
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes as well as federal and state net operating losses and tax credit carryforwards. At September 30, 2013 and December 31, 2012, the Company included $0.5 million of current deferred tax assets in prepaid expenses and other current assets. At September 30, 2013 and December 31, 2012, the Company included $0.8 million and $0.7 million, respectively of non-current deferred tax liabilities in other long-term liabilities on its balance sheet. | ||||||||||||||||
In the future, the Company will generate additional deferred tax assets and liabilities related to its amortization of acquired intangible assets for tax purposes because these long-lived intangible assets are not amortized for financial reporting purposes. The tax amortization in future years will give rise to a temporary difference and a tax liability, which will only reverse at the time of ultimate sale or further impairment of the underlying intangible assets. Due to the uncertain timing of this reversal, the temporary difference cannot be considered as a source of future taxable income for purposes of determining a valuation allowance; therefore, the tax liability cannot be used to offset the deferred tax asset related to the net operating loss carryforward for tax purposes that will be generated by the same amortization. | ||||||||||||||||
The Company had no unrecognized tax benefits at September 30, 2013. |
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policies) | 9 Months Ended | |
Sep. 30, 2013 | ||
Basis of Presentation | ' | |
Basis of Presentation | ||
The unaudited consolidated financial statements in this Quarterly Report on Form 10-Q have been prepared in accordance with generally accepted accounting principles (“GAAP”) for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, these unaudited consolidated financial statements do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments, consisting of normal recurring adjustments, considered necessary for a fair presentation have been included. Operating results for the three and nine month periods ended September 30, 2013, are not necessarily indicative of the results that may be expected for the full year ending December 31, 2013, or for any other subsequent interim period. | ||
The unaudited consolidated financial statements in this Quarterly Report on Form 10-Q should be read in conjunction with the Company’s consolidated financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012. | ||
Use of Estimates in Preparation of Financial Statements | ' | |
Use of Estimates in Preparation of Financial Statements | ||
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect 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 expense during the reporting periods. The most significant estimates used in these financial statements include the valuation of stock-based compensation expense, accounts receivable, inventories, goodwill, deferred revenue and equity instruments, the lives of property and equipment and intangible assets, as well as warranty and doubtful accounts allowance reserve calculations. Actual results may differ from those estimates. | ||
Principles of Consolidation | ' | |
Principles of Consolidation | ||
The unaudited consolidated financial statements in this Quarterly Report on Form 10-Q include the accounts of the Company and its wholly-owned subsidiaries. All material intercompany balances and transactions have been eliminated in consolidation. | ||
Fair Value of Financial Instruments | ' | |
Fair Value Measurements | ||
The Company adopted the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 820, Fair Value Measurements and Disclosures (“ASC 820”) related to the fair value measurement of certain of its assets and liabilities. ASC 820 defines fair value as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also describes three levels of inputs that may be used to measure the fair value: | ||
Level 1 — quoted prices in active markets for identical assets or liabilities | ||
Level 2 — observable inputs other than quoted prices in active markets for identical assets or liabilities | ||
Level 3 — unobservable inputs in which there is little or no market data available, which require the reporting entity to develop its own assumptions | ||
The only assets and liabilities subject to fair value measurement standards at September 30, 2013 and December 31, 2012 are cash equivalents, including money market accounts, and long-term obligations which are based on Level 1 inputs. | ||
Certain of the Company’s financial instruments, including cash and cash equivalents, accounts receivable, accounts payable, accrued expenses and other liabilities are carried at cost, which approximates their fair value because of the short-term maturity of these financial instruments. Based on the borrowing rates currently available to the Company for loans with similar terms, the carrying value of the Company’s long-term debt and capital lease obligations approximates their fair values. | ||
Accounts Receivable and Allowance for Doubtful Accounts | ' | |
Accounts Receivable and Allowance for Doubtful Accounts | ||
Accounts receivable consist of amounts due from third-party payors, patients, third-party distributors, and government agencies. The allowance for doubtful accounts is recorded at the time collection risk is identified. The Company estimates its allowance based on historical experience, assessment of specific risk, discussions with individual customers and various assumptions and estimates that are believed to be reasonable under the circumstances. | ||
Inventories | ' | |
Inventories | ||
Inventories are held at the lower of cost or market, determined under the first-in, first-out method. Inventory has been recorded at cost as of September 30, 2013 and December 31, 2012. Work in process is calculated based upon a build up in the stage of completion using estimated labor inputs for each stage in production. The Company periodically reviews inventories for potential impairment based on quantities on hand and expectations of future use. | ||
Property and Equipment | ' | |
Property and Equipment | ||
Property and equipment is stated at cost and depreciated using the straight-line method over the estimated useful life of the respective assets. Leasehold improvements are amortized over their useful life or the life of the lease, whichever is shorter. Assets acquired under capital leases are amortized in accordance with the respective class of owned assets or life of the lease and the amortization is included with depreciation expense. Maintenance and repair costs are expensed as incurred. In the three and nine month periods ended September 30, 2013 in connection with the transition to the new OmniPod System, the Company recorded a $2.5 million charge to expense the value of manufacturing equipment that was no longer expected to be used in its manufacturing process. | ||
Intangibles and Other Long-Lived Assets | ' | |
Intangibles and Other Long-Lived Assets | ||
The Company’s finite-lived intangible assets are stated at cost less accumulated amortization. The Company assesses its intangible and other long-lived assets for impairment whenever events or changes in circumstances suggest that the carrying value of an asset may not be recoverable. The Company recognizes an impairment loss for intangibles and other long-lived assets if the carrying amount of the asset is not recoverable based on its undiscounted future cash flows. Any such impairment loss is measured as the difference between the carrying amount and the fair value of the asset. The estimation of useful lives and expected cash flows requires the Company to make significant judgments regarding future periods that are subject to some factors outside its control. Changes in these estimates can result in significant revisions to the carrying value of these assets and may result in material charges to the results of operations. The estimated life of the acquired tradename asset is 15 years. The estimated life of the acquired customer relationship asset is 10 years. Intangible assets with determinable estimated lives are amortized over these lives. At September 30, 2013, intangible assets consisted of $16.8 million of customer relationships and $2.4 million of tradenames. | ||
Goodwill | ' | |
Goodwill | ||
Goodwill represents the excess of the cost of the acquired Neighborhood Diabetes businesses over the fair value of identifiable net assets acquired. The Company performs an assessment of its goodwill for impairment on at least an annual basis or whenever events or changes in circumstances indicate there might be impairment. | ||
Goodwill is evaluated at the reporting unit level. To test for impairment, the Company compares the carrying value of the reporting unit to its fair value using a discounted cash flow analysis. If the reporting unit’s carrying value exceeds its fair value, the Company would record an impairment loss to the extent that the carrying value of goodwill exceeds its implied fair value. | ||
Warranty | ' | |
Warranty | ||
The Company provides a four-year warranty on its PDMs and may replace any OmniPods that do not function in accordance with product specifications. The Company estimates its warranty reserves at the time the product is shipped based on historical experience and the estimated cost to service the claims. Cost to service the claims reflects the current product cost, which has been decreasing over time. As these estimates are based on historical experience, and the Company continues to introduce new versions of existing products, the Company also considers the anticipated performance of the product over its warranty period in estimating warranty reserves. | ||
Revenue Recognition | ' | |
Revenue Recognition | ||
The Company generates nearly all of its revenue from sales of its OmniPod System and other diabetes related products including blood glucose testing supplies, traditional insulin pumps, pump supplies and pharmaceuticals to customers and third-party distributors who resell the products to patients with diabetes. | ||
Revenue recognition requires that persuasive evidence of a sales arrangement exists, delivery of goods occurs through transfer of title and risk and rewards of ownership, the selling price is fixed or determinable and collectability is reasonably assured. With respect to these criteria: | ||
• | The evidence of an arrangement generally consists of a physician order form, a patient information form and, if applicable, third-party insurance approval for sales directly to patients or a purchase order for sales to a third-party distributor. | |
• | Transfer of title and risk and rewards of ownership are passed to the patient or third-party distributor upon shipment of the products. | |
• | The selling prices for all sales are fixed and agreed with the patient or third-party distributor and, if applicable, the patient’s third-party insurance provider(s), prior to shipment and are based on established list prices or, in the case of certain third-party insurers, contractually agreed upon prices. Provisions for discounts and rebates to customers are established as a reduction to revenue in the same period the related sales are recorded. | |
The Company offers a 45-day right of return for its OmniPod System sales to new patients, and defers revenue to reflect estimated sales returns in the same period that the related product sales are recorded. Returns are estimated through a comparison of the Company’s historical return data to their related sales. Historical rates of return are adjusted for known or expected changes in the marketplace when appropriate. When doubt exists about reasonable assuredness of collectability from specific customers, the Company defers revenue from sales of products to those customers until payment is received. | ||
In June 2011, the Company entered into a development agreement with a U.S. based pharmaceutical company (the “Development Agreement”). Under the Development Agreement, the Company is required to perform design, development, regulatory and other services to support the pharmaceutical company as it works to obtain regulatory approval to use the Company’s drug delivery technology as a delivery method for its pharmaceutical. Over the term of the Development Agreement, the Company has and will continue to invoice amounts based upon meeting certain deliverable milestones. Revenue from the Development Agreement is recognized using a proportional performance methodology based on efforts incurred and total payments under the agreement. The impact of changes in the expected total effort or contract payments are recognized as a change in estimate using the cumulative catch-up method. | ||
The Company deferred revenue of $0.6 million and $5.4 million as of September 30, 2013 and December 31, 2012, respectively. The deferred revenue recorded was comprised of product-related revenue and unrecognized amounts related to the Development Agreement. | ||
Concentration of Credit Risk | ' | |
Concentration of Credit Risk | ||
Financial instruments that subject the Company to credit risk primarily consist of cash and cash equivalents. The Company maintains the majority of its cash with two accredited financial institutions. | ||
The Company purchases complete OmniPods from Flextronics International Ltd., its single source supplier. As of September 30, 2013 and December 31, 2012, liabilities to one vendor represented approximately 26% and 19% of the combined balance of accounts payable, accrued expenses, and other current liabilities, respectively. | ||
Segment Reporting | ' | |
Segment Reporting | ||
Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated on a regular basis by the chief operating decision-maker, or decision-making group, in deciding how to allocate resources to an individual segment and in assessing performance of the segment. The Company’s current product offering consists of diabetes supplies, including the OmniPod System as well as other diabetes related products and supplies such as blood glucose testing supplies, traditional insulin pumps, pump supplies and pharmaceuticals. The Company’s current product offering is marketed to a single customer type, people with diabetes. As the Company sells a single product type, management operates the business as a single entity. | ||
Income Taxes | ' | |
Income Taxes | ||
Deferred tax assets and liabilities are determined based on differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates that will be in effect in the years in which the differences are expected to reverse. A valuation allowance is required to reduce the deferred tax assets reported if, based on the weight of the evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The Company reviews its deferred tax assets for recoverability considering historical profitability, projected future taxable income, and the expected timing of the reversals of existing temporary differences and tax planning strategies. | ||
The Company follows the provisions of FASB ASC 740-10, Income Taxes (“ASC 740-10”) on the accounting for uncertainty in income taxes recognized in its financial statements. ASC 740-10 prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. In addition, ASC 740-10 provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, and disclosure and transition. The Company recognizes estimated interest and penalties for uncertain tax positions in income tax expense. As of September 30, 2013 interest and penalties were immaterial to the consolidated financial statements. | ||
The Company files federal, state and foreign tax returns. These returns are generally open to examination by the relevant tax authorities from three to four years from the date they are filed. The tax filings relating to the Company's federal and state returns are currently open to examination for tax years 2010 through 2012 and 2009 through 2012, respectively. In addition, the Company has generated tax losses since its inception in 2000. These years may be subject to examination if the losses are carried forward and utilized in future years. | ||
Stock Based Compensation | ' | |
Stock-Based Compensation | ||
The Company accounts for stock-based compensation under the provisions of FASB ASC 718-10, Compensation — Stock Compensation (“ASC 718-10”), which requires all share-based payments to employees, including grants of employee stock options, to be recognized in the income statement based on their fair values. Share-based payments that contain performance conditions are recognized when such conditions are probable of being achieved. | ||
The Company uses the Black-Scholes option pricing model to determine the weighted average fair value of options granted. The Company determines the intrinsic value of restricted stock units based on the closing price of its common stock on the date of grant. The Company recognizes the compensation expense of share-based awards on a straight-line basis for awards with only service conditions and on an accelerated method for awards with performance conditions. Compensation expense is recognized over the respective vesting periods of the awards. | ||
The determination of the fair value of share-based payment awards utilizing the Black-Scholes model is affected by the stock price and a number of assumptions, including expected volatility, expected life, risk-free interest rate and expected dividends. The expected life of the awards is estimated based on the midpoint between the vesting date and the end of the contractual term. The risk-free interest rate assumption is based on observed interest rates appropriate for the terms of the awards. The dividend yield assumption is based on company history and expectation of paying no dividends. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. Stock-based compensation expense recognized in the financial statements is based on awards that are ultimately expected to vest. The Company evaluates the assumptions used to value the awards on a quarterly basis and, if factors change and different assumptions are utilized, stock-based compensation expense may differ significantly from what has been recorded in the past. If there are any modifications or cancellations of the underlying unvested securities, the Company may be required to accelerate, increase or cancel any remaining unearned stock-based compensation expense. | ||
See Footnote 12 for a summary of the stock activity under the Company’s stock-based employee compensation plan. | ||
Recent Accounting Pronouncements | ' | |
Recent Accounting Pronouncements | ||
In July 2012, the FASB issued ASU No. 2012-2 Intangibles – Goodwill and Other (Topic 350): Testing Indefinite-Lived Intangible Assets for Impairment (“ASU No. 2012-2”). ASU No. 2012-2 gives a company the option to first assess qualitative factors to determine whether it is more-likely-than-not that the indefinite-lived intangible is impaired. Qualitative factors include related events and circumstances that could affect the significant inputs used in determining the fair value of the indefinite-lived intangible asset. The guidance is effective in fiscal years beginning after September 15, 2012. The Company adopted the guidance in the first quarter of 2013. The adoption of the guidance did not have a material impact on the Company's financial statements. |
Debt_Tables
Debt (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Outstanding Convertible Debt and Related Deferred Financing Costs | ' | |||||||||||||||
The Company had outstanding convertible debt and related deferred financing costs on its consolidated balance sheet as follows (in thousands): | ||||||||||||||||
As of | ||||||||||||||||
September 30, | December 31, | |||||||||||||||
2013 | 2012 | |||||||||||||||
Principal amount of the 5.375% Convertible Senior Notes | $ | — | $ | 15,000 | ||||||||||||
Principal amount of the 3.75% Convertible Senior Notes | 143,750 | 143,750 | ||||||||||||||
Unamortized discount | (32,633 | ) | (40,591 | ) | ||||||||||||
Total long-term debt | 111,117 | 118,159 | ||||||||||||||
Current portion of debt | — | 14,429 | ||||||||||||||
Long-term debt | $ | 111,117 | $ | 103,730 | ||||||||||||
Deferred financing costs | $ | 1,560 | $ | 2,004 | ||||||||||||
Interest and Other Expense | ' | |||||||||||||||
Interest and other expense related to the 5.375% Notes (as defined below) and the 3.75% Notes (as defined below) was included in interest and other expense on the consolidated statements of operations as follows (in thousands): | ||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Contractual coupon interest | $ | 1,347 | $ | 1,549 | $ | 4,356 | $ | 4,647 | ||||||||
Accretion of debt discount | 2,447 | 2,420 | 7,958 | 7,111 | ||||||||||||
Loss on debt extinguishment | — | — | 325 | — | ||||||||||||
Amortization of debt issuance costs | 146 | 148 | 443 | 445 | ||||||||||||
Total interest and other expense | $ | 3,940 | $ | 4,117 | $ | 13,082 | $ | 12,203 | ||||||||
Capital_Lease_Obligations_Tabl
Capital Lease Obligations (Tables) | 9 Months Ended | |||
Sep. 30, 2013 | ||||
Capital Lease Obligation [Abstract] | ' | |||
Schedule of Future Minimum Lease Payments for Capital Leases | ' | |||
The aggregate future minimum lease payments related to these capital leases as of September 30, 2013, are as follows (in thousands): | ||||
Year Ending | Minimum Lease | |||
December 31, | Payments | |||
2013 (remaining) | 954 | |||
2014 | 3,815 | |||
2015 | 3,815 | |||
2016 | 2,409 | |||
Total | $ | 10,993 | ||
Net_Loss_Per_Share_Tables
Net Loss Per Share (Tables) | 9 Months Ended | |||||
Sep. 30, 2013 | ||||||
Potential Common Shares Excluded from Computation of Diluted Net Loss per Share | ' | |||||
Such potentially dilutive common share equivalents consist of the following: | ||||||
Three and Nine Months Ended | ||||||
September 30, | ||||||
2013 | 2012 | |||||
5.375% Convertible Senior Notes | — | 702,701 | ||||
3.75% Convertible Senior Notes | 5,487,642 | 5,487,642 | ||||
Unvested restricted stock units | 1,034,277 | 863,651 | ||||
Outstanding options | 2,130,560 | 2,693,936 | ||||
Outstanding warrants | 62,752 | 62,752 | ||||
Total dilutive common shares | 8,715,231 | 9,810,682 | ||||
Accounts_Receivable_Tables
Accounts Receivable (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Receivables [Abstract] | ' | |||||||
Components of Accounts Receivable | ' | |||||||
The components of accounts receivable are as follows: | ||||||||
As of | ||||||||
September 30, | 31-Dec-12 | |||||||
2013 | ||||||||
(In thousands) | ||||||||
Trade receivables | $ | 41,762 | $ | 39,921 | ||||
Allowance for doubtful accounts | (7,297 | ) | (6,627 | ) | ||||
Total accounts receivable | $ | 34,465 | $ | 33,294 | ||||
Inventories_Tables
Inventories (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Components of Inventories | ' | |||||||
Inventories consist of the following: | ||||||||
As of | ||||||||
September 30, | 31-Dec-12 | |||||||
2013 | ||||||||
(In thousands) | ||||||||
Raw materials | $ | 321 | $ | 1,487 | ||||
Work-in-process | 6 | 1,595 | ||||||
Finished goods | 5,068 | 11,785 | ||||||
Total inventories | $ | 5,395 | $ | 14,867 | ||||
Other_Intangible_Assets_Tables
Other Intangible Assets (Tables) | 9 Months Ended | |||||||
Sep. 30, 2013 | ||||||||
Components of Other Intangible Assets | ' | |||||||
Other intangible assets consist of the following: | ||||||||
As of | ||||||||
September 30, | December 31, | |||||||
2013 | 2012 | |||||||
(In thousands) | ||||||||
Customer relationships | $ | 30,100 | $ | 30,100 | ||||
Tradename | 2,800 | 2,800 | ||||||
Total intangible assets | 32,900 | 32,900 | ||||||
Less: accumulated amortization | (13,746 | ) | (9,937 | ) | ||||
Total | $ | 19,154 | $ | 22,963 | ||||
Product_Warranty_Costs_Tables
Product Warranty Costs (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Reconciliation of Changes in Product Warranty Liability | ' | |||||||||||||||
A reconciliation of the changes in the Company’s product warranty liability is as follows: | ||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
(In thousands) | ||||||||||||||||
Balance at the beginning of the period | $ | 2,401 | $ | 1,822 | $ | 1,992 | $ | 1,960 | ||||||||
Warranty expense | 1,110 | 645 | 2,771 | 1,867 | ||||||||||||
Warranty claims settled | (702 | ) | (661 | ) | (1,954 | ) | (2,021 | ) | ||||||||
Balance at the end of the period | $ | 2,809 | $ | 1,806 | $ | 2,809 | $ | 1,806 | ||||||||
As of | ||||||||||||||||
September 30, | December 31, | |||||||||||||||
2013 | 2012 | |||||||||||||||
(In thousands) | ||||||||||||||||
Composition of balance: | ||||||||||||||||
Short-term | $ | 1,047 | $ | 863 | ||||||||||||
Long-term | 1,762 | 1,129 | ||||||||||||||
$ | 2,809 | $ | 1,992 | |||||||||||||
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 9 Months Ended | |||
Sep. 30, 2013 | ||||
Commitments and Contingencies Disclosure [Abstract] | ' | |||
Aggregate Future Minimum Lease Payments | ' | |||
The aggregate future minimum lease payments related to these leases as of September 30, 2013, are as follows (in thousands): | ||||
Year Ending | Minimum Lease | |||
December 31, | Payments | |||
2013 (remaining) | 361 | |||
2014 | 1,134 | |||
2015 | 96 | |||
Total | $ | 1,591 | ||
Equity_Tables
Equity (Tables) | 9 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Stock Option Activity | ' | ||||||||||||
The following summarizes the activity under the Company’s stock option plans: | |||||||||||||
Number of | Weighted | Aggregate | |||||||||||
Options (#) | Average | Intrinsic | |||||||||||
Exercise | Value ($) | ||||||||||||
Price ($) | |||||||||||||
(In thousands) | |||||||||||||
Balance, December 31, 2012 | 2,502,190 | $ | 13.51 | ||||||||||
Granted | 276,900 | 25.54 | |||||||||||
Exercised | (595,159 | ) | 10.3 | $ | 10,930 | (1 | ) | ||||||
Canceled | (53,371 | ) | 19.36 | ||||||||||
Balance, September 30, 2013 | 2,130,560 | $ | 15.82 | $ | 43,499 | ||||||||
Vested, September 30, 2013 | 1,302,995 | $ | 12.7 | $ | 30,676 | (2 | ) | ||||||
Vested and expected to vest, September 30, 2013 (3) | 1,827,646 | $ | 38,633 | (2 | ) | ||||||||
-1 | The aggregate intrinsic value was calculated based on the positive difference between the fair market value of the Company’s common stock as of the date of exercise and the exercise price of the underlying options. | ||||||||||||
-2 | The aggregate intrinsic value was calculated based on the positive difference between the fair market value of the Company’s common stock as of September 30, 2013 and the exercise price of the underlying options. | ||||||||||||
-3 | Represents the number of vested options as of September 30, 2013, plus the number of unvested options expected to vest as of September 30, 2013, based on the unvested options outstanding as of September 30, 2013, adjusted for the estimated forfeiture rate of 16%. | ||||||||||||
Summary of Restricted Stock Units | ' | ||||||||||||
The following table summarizes the status of the Company’s restricted stock units: | |||||||||||||
Number of | Weighted | ||||||||||||
Shares (#) | Average | ||||||||||||
Fair Value ($) | |||||||||||||
Balance, December 31, 2012 | 825,068 | $ | 18.4 | ||||||||||
Granted | 563,875 | 23.93 | |||||||||||
Vested | (301,241 | ) | 17.6 | ||||||||||
Forfeited | (53,425 | ) | 20.26 | ||||||||||
Balance, September 30, 2013 | 1,034,277 | $ | 21.55 | ||||||||||
Income_Taxes_Tables
Income Taxes (Tables) | 9 Months Ended | |||||||||||||||
Sep. 30, 2013 | ||||||||||||||||
Income Tax Disclosure [Abstract] | ' | |||||||||||||||
Income Tax expense | ' | |||||||||||||||
Income tax expense (benefit) consists of the following (in thousands): | ||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Current | $ | (20 | ) | $ | 15 | $ | 171 | $ | 78 | |||||||
Deferred | 25 | 13 | 83 | 65 | ||||||||||||
Total | $ | 5 | $ | 28 | $ | 254 | $ | 143 | ||||||||
Nature_of_the_Business_Nature_
Nature of the Business Nature of Business (Details) | Sep. 30, 2013 |
in | |
Nature of Business [Line Items] | ' |
Number of Inches of Tubing in conventional insulin pump | 42 |
Summary_of_Significant_Account2
Summary of Significant Accounting Policies (Detail) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | |
location | segment | customer | ||
customer | location | |||
customer | ||||
Significant Accounting Policies [Line Items] | ' | ' | ' | ' |
Impairment and other charges | $2,511,000 | $2,511,000 | $0 | ' |
Intangible assets | 19,154,000 | 19,154,000 | ' | 22,963,000 |
Product warranty term for PDMs | ' | '4 years | ' | ' |
Right of return period for Starter Kits sales | ' | '45 days | ' | ' |
Deferred revenue | 600,000 | 600,000 | ' | 5,400,000 |
Number of accredited financial institutions which the Company maintains the majority of its cash | 2 | 2 | ' | ' |
Number of Single Source Suppliers | 1 | 1 | ' | 1 |
Number of operating segment | ' | 1 | ' | ' |
Concentration Risk, Percentage | ' | 26.00% | ' | 19.00% |
Maximum | ' | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' | ' |
Number of Open Tax Years | ' | '4 years | ' | ' |
Minimum | ' | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' | ' |
Number of Open Tax Years | ' | '3 years | ' | ' |
Neighborhood Diabetes | Tradename | ' | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' | ' |
Intangible assets | 2,400,000 | 2,400,000 | ' | ' |
Neighborhood Diabetes | Tradename | Maximum | ' | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' | ' |
Estimated useful life | ' | '15 years | ' | ' |
Neighborhood Diabetes | Customer relationships | ' | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' | ' |
Intangible assets | $16,800,000 | $16,800,000 | ' | ' |
Neighborhood Diabetes | Customer relationships | Maximum | ' | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' | ' |
Estimated useful life | ' | '10 years | ' | ' |
Debt_Outstanding_Convertible_D
Debt - Outstanding Convertible Debt and Related Deferred Financing Costs (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | Jun. 30, 2011 | Jun. 30, 2008 |
In Thousands, unless otherwise specified | ||||
Debt Instrument [Line Items] | ' | ' | ' | ' |
Unamortized discount | ($32,633) | ($40,591) | ' | ' |
Total debt | 111,117 | 118,159 | ' | ' |
Current portion of long-term debt | 0 | 14,429 | ' | ' |
Long-term debt | 111,117 | 103,730 | ' | ' |
Deferred financing costs | 1,560 | 2,004 | ' | ' |
5.375% Convertible Notes | ' | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' | ' |
Principal amount of Senior Notes | 0 | 15,000 | ' | 85,000 |
Unamortized discount | ' | ' | -10,500 | -26,900 |
3.75% Convertible Notes | ' | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' | ' |
Principal amount of Senior Notes | $143,750 | $143,750 | $143,800 | ' |
Debt_Interest_Expense_Detail
Debt - Interest Expense (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Debt Instrument [Line Items] | ' | ' | ' | ' |
Contractual coupon interest | $1,347 | $1,549 | $4,356 | $4,647 |
Accretion of debt discount | 2,447 | 2,420 | 7,958 | 7,111 |
Loss on debt extinguishment | 0 | 0 | 325 | 0 |
Amortization of debt issuance costs | 146 | 148 | 443 | 445 |
Total interest and other expense | $3,940 | $4,117 | $13,082 | $12,203 |
Debt_Narrative_Detail
Debt - Narrative (Detail) (USD $) | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||||||
Jun. 30, 2013 | 31-May-13 | Jun. 30, 2011 | Jun. 30, 2008 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | |
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Shares Issued with debt conversion | 26,523 | 620,122 | ' | ' | ' | ' | ' | ' | ' |
Debt discount | ' | ' | ' | ' | $32,633,000 | ' | $32,633,000 | ' | $40,591,000 |
Loss on debt extinguishment | ' | ' | ' | ' | 0 | 0 | 325,000 | 0 | ' |
Short-term portion of long-term debt | ' | ' | ' | ' | 0 | ' | 0 | ' | 14,429,000 |
Long-term debt | ' | ' | ' | ' | 111,117,000 | ' | 111,117,000 | ' | 103,730,000 |
Investor | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Modified debt held by investors in the Notes | ' | ' | 73,000,000 | ' | ' | ' | ' | ' | ' |
5.375% Convertible Notes | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Principal amount of Senior Notes | ' | ' | ' | 85,000,000 | 0 | ' | 0 | ' | 15,000,000 |
Interest Paid | ' | 300,000 | ' | ' | ' | ' | ' | ' | ' |
Debt, interest rate | ' | ' | ' | 5.38% | ' | ' | ' | ' | ' |
Debt, maturity date | ' | ' | ' | 15-Jun-13 | ' | ' | ' | ' | ' |
Frequency of interest payment | ' | ' | ' | 'semi-annually | ' | ' | ' | ' | ' |
Debt conversion rate | ' | ' | ' | 46.8467 | ' | ' | ' | ' | ' |
Principal amount per note used in conversion rate | ' | ' | ' | 1,000 | ' | ' | ' | ' | ' |
Conversion price, per share | ' | ' | ' | $21.35 | ' | ' | ' | ' | ' |
Debt instrument convertible premium | ' | ' | ' | 34.00% | ' | ' | ' | ' | ' |
Debt discount | ' | ' | 10,500,000 | 26,900,000 | ' | ' | ' | ' | ' |
Nonconvertible debt borrowing rate | ' | ' | ' | 14.50% | ' | ' | ' | ' | ' |
Debt discount amortization period | ' | ' | ' | '5 years | ' | ' | ' | ' | ' |
Deferred financing costs | ' | ' | ' | 3,500,000 | ' | ' | ' | ' | ' |
Finance costs reclassified against equity | ' | ' | ' | 1,100,000 | ' | ' | ' | ' | ' |
Deferred financing costs, amortization period | ' | ' | ' | '5 years | ' | ' | ' | ' | ' |
Principal payments of long term debt | ' | ' | 85,100,000 | ' | ' | ' | ' | ' | ' |
Repurchase premium | ' | ' | 21.50% | ' | ' | ' | ' | ' | ' |
Prinicpal amount of debt converted | ' | 13,000,000 | ' | ' | ' | ' | ' | ' | ' |
Loss on debt extinguishment | ' | ' | ' | ' | ' | ' | 300,000 | ' | ' |
Repayment of remaining prinicpal amount including interest | 2,100,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Interest expense related to Notes | ' | ' | ' | ' | 0 | 200,000 | 300,000 | 600,000 | ' |
5.375% Convertible Notes | Investor | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Principal amount of Senior Notes | ' | ' | 70,000,000 | ' | ' | ' | ' | ' | ' |
Modified debt held by investors in the Notes | ' | ' | 13,500,000 | ' | ' | ' | ' | ' | ' |
5.375% Convertible Notes | Semi Annual Payment, First Payment | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest payment date | ' | ' | 'December 15 | ' | ' | ' | ' | ' | ' |
5.375% Convertible Notes | Semi Annual Payment, Second Payment | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest payment date | ' | ' | 'June 15 | ' | ' | ' | ' | ' | ' |
3.75% Convertible Notes | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Principal amount of Senior Notes | ' | ' | 143,800,000 | ' | 143,750,000 | ' | 143,750,000 | ' | 143,750,000 |
Debt, interest rate | ' | ' | 3.75% | ' | ' | ' | ' | ' | ' |
Debt, maturity date | ' | ' | 15-Jun-16 | ' | ' | ' | ' | ' | ' |
Frequency of interest payment | ' | ' | 'semi-annually | ' | ' | ' | ' | ' | ' |
Debt conversion rate | ' | ' | 38.1749 | ' | ' | ' | ' | ' | ' |
Principal amount per note used in conversion rate | ' | ' | 1,000 | ' | ' | ' | ' | ' | ' |
Conversion price, per share | ' | ' | $26.20 | ' | ' | ' | ' | ' | ' |
Percentage of the principal amount of the notes to be repurchased, if a fundamental change occurs | ' | ' | 100.00% | ' | ' | ' | ' | ' | ' |
Deferred financing costs, amortization period | ' | ' | '5 years | ' | ' | ' | ' | ' | ' |
Interest expense related to Notes | ' | ' | ' | ' | 1,300,000 | 1,300,000 | 4,000,000 | 4,000,000 | ' |
Remaining term of debt | ' | ' | ' | ' | ' | ' | '2 years 9 months | ' | ' |
Percentage required of the last reported sale price per share of the Company's common stock for redemption | ' | ' | 130.00% | ' | ' | ' | ' | ' | ' |
Number of trading days | ' | ' | '20 days | ' | ' | ' | ' | ' | ' |
Number of consecutive trading days | ' | ' | '30 days | ' | ' | ' | ' | ' | ' |
3.75% Convertible Notes | Maximum | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt conversion rate | ' | ' | 50.5816 | ' | ' | ' | ' | ' | ' |
Principal amount per note used in conversion rate | ' | ' | 1,000 | ' | ' | ' | ' | ' | ' |
3.75% Convertible Notes | Investor | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Modified debt held by investors in the Notes | ' | ' | 59,500,000 | ' | ' | ' | ' | ' | ' |
3.75% Convertible Notes | Debt discount related to premium payment in connection with the purchase | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt discount | ' | ' | 15,100,000 | ' | ' | ' | ' | ' | ' |
3.75% Convertible Notes | Debt discount related to the increase in the value of the conversion feature. | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt discount | ' | ' | 200,000 | ' | ' | ' | ' | ' | ' |
3.75% Convertible Notes | Modified Debt | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt discount | ' | ' | 25,800,000 | ' | ' | ' | ' | ' | ' |
Nonconvertible debt borrowing rate | ' | ' | 16.50% | ' | ' | ' | ' | ' | ' |
Debt discount amortization period | ' | ' | '5 years | ' | ' | ' | ' | ' | ' |
Transaction fees | ' | ' | 2,000,000 | ' | ' | ' | ' | ' | ' |
3.75% Convertible Notes | New Debt | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt discount | ' | ' | 26,600,000 | ' | ' | ' | ' | ' | ' |
Nonconvertible debt borrowing rate | ' | ' | 12.40% | ' | ' | ' | ' | ' | ' |
Debt discount amortization period | ' | ' | '5 years | ' | ' | ' | ' | ' | ' |
Deferred financing costs | ' | ' | 2,800,000 | ' | ' | ' | ' | ' | ' |
Finance costs reclassified against equity | ' | ' | 900,000 | ' | ' | ' | ' | ' | ' |
Principal debt amount issued to new investors | ' | ' | $84,300,000 | ' | ' | ' | ' | ' | ' |
3.75% Convertible Notes | Semi Annual Payment, First Payment | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest payment date | ' | ' | 'December 15 | ' | ' | ' | ' | ' | ' |
3.75% Convertible Notes | Semi Annual Payment, Second Payment | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest payment date | ' | ' | 'June 15 | ' | ' | ' | ' | ' | ' |
Capital_Lease_Obligations_Deta
Capital Lease Obligations (Details) (USD $) | 3 Months Ended | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 |
Capital Leased Assets [Line Items] | ' | ' | ' |
Purchases of property and equipment under capital lease | ' | $9,021 | $0 |
Interest expense on capital lease obiligation | 100 | 100 | ' |
2013 (remaining) | 954 | 954 | ' |
2014 | 3,815 | 3,815 | ' |
2015 | 3,815 | 3,815 | ' |
2016 | 2,409 | 2,409 | ' |
Total | 10,993 | 10,993 | ' |
Capital Lease Term | ' | '36 months | ' |
Capital Lease Effective Interest Rate | ' | 17.00% | ' |
Impairment and other charges | 2,511 | 2,511 | 0 |
Capital Leased Assets, Gross | $6,500 | $6,500 | ' |
Property, Plant and Equipment, Useful Life | ' | '5 years | ' |
Net_Loss_Per_Share_Potential_C
Net Loss Per Share - Potential Common Shares Excluded from Computation of Diluted Net Loss Per Share (Detail) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Antidilutive securities excluded from computation of earnings per share, amount | 8,715,231 | 9,810,682 | 8,715,231 | 9,810,682 |
5.375% Convertible Notes | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Antidilutive securities excluded from computation of earnings per share, amount | 0 | 702,701 | 0 | 702,701 |
3.75% Convertible Notes | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Antidilutive securities excluded from computation of earnings per share, amount | 5,487,642 | 5,487,642 | 5,487,642 | 5,487,642 |
Restricted Stock Units | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Antidilutive securities excluded from computation of earnings per share, amount | 1,034,277 | 863,651 | 1,034,277 | 863,651 |
Outstanding options | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Antidilutive securities excluded from computation of earnings per share, amount | 2,130,560 | 2,693,936 | 2,130,560 | 2,693,936 |
Outstanding warrants | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Antidilutive securities excluded from computation of earnings per share, amount | 62,752 | 62,752 | 62,752 | 62,752 |
Accounts_Receivable_Components
Accounts Receivable - Components of Accounts Receivable (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Receivables [Abstract] | ' | ' |
Trade receivables | $41,762 | $39,921 |
Allowance for doubtful accounts | -7,297 | -6,627 |
Accounts receivable, net | $34,465 | $33,294 |
Accounts_Receivable_Narrative_
Accounts Receivable Narrative (Details) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2013 | Dec. 31, 2012 | |
customer | customer | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ' | ' |
Number Of Customers With Greater Than Ten Percent Accounts Receivable Balance | 2 | 2 |
Concentration Risk, Percentage | 26.00% | 19.00% |
Customer One | ' | ' |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ' | ' |
Concentration Risk, Percentage | 11.00% | 18.00% |
Customer Two | ' | ' |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ' | ' |
Concentration Risk, Percentage | 10.00% | 11.00% |
Inventories_Components_of_Inve
Inventories - Components of Inventories (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Schedule of Inventory [Line Items] | ' | ' |
Raw materials | $321 | $1,487 |
Work-in-process | 6 | 1,595 |
Finished goods | 5,068 | 11,785 |
Total inventories | $5,395 | $14,867 |
Other_Intangible_Assets_Compon
Other Intangible Assets - Components of Other Intangible Assets (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ' | ' |
Finite-Lived Intangible Assets, Gross | $32,900 | $32,900 |
Less: Accumulated amortization | -13,746 | -9,937 |
Total | 19,154 | 22,963 |
Customer relationships | ' | ' |
Acquired Finite-Lived Intangible Assets [Line Items] | ' | ' |
Finite-Lived Intangible Assets, Gross | 30,100 | 30,100 |
Less: Accumulated amortization | -13,300 | -9,600 |
Tradename | ' | ' |
Acquired Finite-Lived Intangible Assets [Line Items] | ' | ' |
Finite-Lived Intangible Assets, Gross | 2,800 | 2,800 |
Less: Accumulated amortization | ($400) | ($300) |
Other_Intangible_Assets_Narrat
Other Intangible Assets - Narrative (Detail) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | 12 Months Ended | 9 Months Ended | 9 Months Ended | |||||||||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2011 | Dec. 31, 2012 | Dec. 31, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | |
Scenario, Forecast | Customer relationships | Customer relationships | Tradename | Tradename | Neighborhood Diabetes | Neighborhood Diabetes | Neighborhood Diabetes | Neighborhood Diabetes | |||||||
Customer relationships | Customer relationships | Tradename | Tradename | ||||||||||||
Maximum | Maximum | ||||||||||||||
Acquired Finite-Lived Intangible Assets [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Other intangible assets cost | ' | ' | ' | ' | $32,900,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated useful life | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '10 years | ' | '15 years |
Finite-Lived Intangible Assets, Accumulated Amortization | 13,746,000 | ' | 13,746,000 | ' | ' | 9,937,000 | ' | 13,300,000 | 9,600,000 | 400,000 | 300,000 | ' | ' | ' | ' |
Amortization of other intangible assets | 1,100,000 | 1,400,000 | 3,800,000 | 4,600,000 | ' | ' | 4,900,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Intangible asset, weighted average amortization period | ' | ' | '8 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Intangible assets | 19,154,000 | ' | 19,154,000 | ' | ' | 22,963,000 | ' | ' | ' | ' | ' | 16,800,000 | ' | 2,400,000 | ' |
Impairment of Intangible Assets, Finite-lived | ' | ' | $0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Goodwill_Additional_Informatio
Goodwill - Additional Information (Detail) (USD $) | 9 Months Ended |
Sep. 30, 2013 | |
Goodwill [Line Items] | ' |
Goodwill impairment loss | $0 |
Product_Warranty_Costs_Narrati
Product Warranty Costs - Narrative (Detail) | 9 Months Ended |
Sep. 30, 2013 | |
Schedule of Accrued Liabilities [Line Items] | ' |
Product warranty term for PDMs | '4 years |
Product_Warranty_Costs_Reconci
Product Warranty Costs - Reconciliation of Changes in Product Warranty Liability (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Movement in Standard and Extended Product Warranty, Increase (Decrease) [Roll Forward] | ' | ' | ' | ' |
Balance at the beginning of the period | $2,401 | $1,822 | $1,992 | $1,960 |
Warranty expense | 1,110 | 645 | 2,771 | 1,867 |
Warranty claims settled | -702 | -661 | -1,954 | -2,021 |
Balance at the end of the period | $2,809 | $1,806 | $2,809 | $1,806 |
Product_Warranty_Costs_Product
Product Warranty Costs - Product Warranty Liability (Detail) (USD $) | Sep. 30, 2013 | Jun. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Dec. 31, 2011 |
In Thousands, unless otherwise specified | ||||||
Composition of balance: | ' | ' | ' | ' | ' | ' |
Short-term | $1,047 | ' | $863 | ' | ' | ' |
Long-term | 1,762 | ' | 1,129 | ' | ' | ' |
Total warranty balance | $2,809 | $2,401 | $1,992 | $1,806 | $1,822 | $1,960 |
Commitments_and_Contingencies_1
Commitments and Contingencies - Operating Leases (Detail) | 9 Months Ended | |
Sep. 30, 2013 | Dec. 31, 2012 | |
sqft | ||
Operating Leased Assets [Line Items] | ' | ' |
Renewal Option Terms Additional Period | '5 years | ' |
Bedford, Massachusetts | ' | ' |
Operating Leased Assets [Line Items] | ' | ' |
Lease expiration date | '2014-09 | ' |
Lease facility area | ' | 26,500 |
Billerica, Massachusetts | ' | ' |
Operating Leased Assets [Line Items] | ' | ' |
Lease expiration date | '2014-09 | ' |
Woburn, Massachusetts | ' | ' |
Operating Leased Assets [Line Items] | ' | ' |
Lease expiration date | '2014-12 | ' |
Singapore | ' | ' |
Operating Leased Assets [Line Items] | ' | ' |
Lease expiration date | '2015-07 | ' |
FLORIDA | ' | ' |
Operating Leased Assets [Line Items] | ' | ' |
Lease expiration date | '2013-12 | ' |
New York State | ' | ' |
Operating Leased Assets [Line Items] | ' | ' |
Lease expiration date | '2015-04 | ' |
Commitments_and_Contingencies_2
Commitments and Contingencies - Legal Proceedings (Details) (USD $) | 9 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2013 | Aug. 31, 2010 | Apr. 30, 2013 |
Medtronic Inc [Member] | Patents | Patents | |
Becton Dickinson and Company | Rydex Technologies LLC | ||
patent | patent | ||
Loss Contingencies [Line Items] | ' | ' | ' |
Number Of Patents Allegedly Infringed On | ' | 3 | 1 |
Litigation Settlement, Expense | $10 | ' | ' |
Commitments_and_Contingencies_3
Commitments and Contingencies - Aggregate Future Minimum Lease Payments (Detail) (USD $) | Sep. 30, 2013 |
In Thousands, unless otherwise specified | |
Minimum Lease Payments | ' |
2013 (remaining) | $361 |
2014 | 1,134 |
2015 | 96 |
Total | $1,591 |
Equity_Additional_Information_
Equity - Additional Information (Detail) (USD $) | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||||
Jun. 30, 2013 | 31-May-13 | Jan. 31, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Shares of common stock issued and sold | ' | ' | 4,715,000 | ' | ' | ' | ' |
Common stock price per share | ' | ' | $20.75 | ' | ' | ' | ' |
Proceeds from Issuance of Common Stock | ' | ' | $97,800,000 | ' | ' | $99,164,000 | $3,142,000 |
Proceeds of Issuance of Common Stock Net of Expenses | ' | ' | 92,800,000 | ' | ' | ' | ' |
Shares Issued with debt conversion | 26,523 | 620,122 | ' | ' | ' | ' | ' |
Stock-based compensation expense | ' | ' | ' | 3,000,000 | 2,300,000 | 9,800,000 | 7,500,000 |
Total unrecognized compensation expense | ' | ' | ' | 26,600,000 | ' | 26,600,000 | ' |
Employee Stock Option | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Stock-based compensation expense | ' | ' | ' | 1,100,000 | 1,200,000 | 3,600,000 | 3,700,000 |
Total unrecognized compensation expense | ' | ' | ' | 8,100,000 | ' | 8,100,000 | ' |
5.375% Convertible Notes | ' | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Prinicpal amount of debt converted | ' | 13,000,000 | ' | ' | ' | ' | ' |
Repayment of remaining principal of 5.375% Notse | 2,000,000 | ' | ' | ' | ' | ' | ' |
Equity_Stock_Option_Activity_D
Equity - Stock Option Activity (Detail) (USD $) | 9 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2013 | |
Number of Options | ' | |
Beginning balance (in shares) | 2,502,190 | |
Granted (in shares) | 276,900 | |
Exercised (in shares) | -595,159 | |
Canceled (in shares) | -53,371 | |
Ending balance (in shares) | 2,130,560 | |
Vested, at end of period (in shares) | 1,302,995 | |
Vested and expected to vest, at end of period (in shares) | 1,827,646 | [1] |
Weighted Average Exercise Price | ' | |
Beginning balance (in USD per share) | $13.51 | |
Granted (in USD per share) | $25.54 | |
Exercised (in USD per share) | $10.30 | |
Canceled (in USD per share) | $19.36 | |
Ending balance (in USD per share) | $15.82 | |
Vested, at end of period (in USD per share) | $12.70 | |
Aggregate Intrinsic Value | ' | |
Exercised | $10,930 | [2] |
Ending balance | 43,499 | |
Vested, at end of period | 30,676 | [3] |
Vested and expected to vest, at end of period | $38,633 | [3] |
Estimated forfeiture rate | 16.00% | |
[1] | Represents the number of vested options as of September 30, 2013, plus the number of unvested options expected to vest as of September 30, 2013, based on the unvested options outstanding as of September 30, 2013, adjusted for the estimated forfeiture rate of 16%. | |
[2] | The aggregate intrinsic value was calculated based on the positive difference between the fair market value of the Company’s common stock as of the date of exercise and the exercise price of the underlying options. | |
[3] | The aggregate intrinsic value was calculated based on the positive difference between the fair market value of the Company’s common stock as of September 30, 2013 and the exercise price of the underlying options. |
Equity_Stock_Options_Narrative
Equity - Stock Options Narrative (Details) (USD $) | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||||||||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Jan. 31, 2012 | 31-May-07 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | 31-May-12 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Employee Stock Purchase Plans | Employee Stock Purchase Plans | Employee Stock Purchase Plans | Employee Stock Purchase Plans | Stock Options and Restricted Stock Units | Employee Stock Option | Employee Stock Option | Employee Stock Option | Employee Stock Option | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Options outstanding, shares | 2,130,560 | ' | 2,130,560 | ' | 2,502,190 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Options outstanding, weighted average exercise price | $15.82 | ' | $15.82 | ' | $13.51 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Options outstanding, weighted average remaining contractual life | ' | ' | '6 years 9 months 50 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Options exercisable, shares | 1,302,995 | ' | 1,302,995 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Options exercisable, weighted average exercise price | $12.70 | ' | $12.70 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Options exercisable, weighted average remaining contractual life | ' | ' | '5 years 9 months 15 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock-based compensation expense | $3,000,000 | $2,300,000 | $9,800,000 | $7,500,000 | ' | ' | ' | $0 | $0 | $0 | $0 | ' | $1,100,000 | $1,200,000 | $3,600,000 | $3,700,000 |
Total unrecognized compensation expense | $26,600,000 | ' | $26,600,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | $8,100,000 | ' | $8,100,000 | ' |
Shares reserved for issuance under the plan | ' | ' | ' | ' | ' | ' | 535,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum annual increase in shares of common stock reserved for issuance on January 1, 2012 | ' | ' | ' | ' | ' | 725,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total unrecognized compensation expense weighted-average period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '1 year 2 months 18 days | ' |
Number Of Additional Shares Available For Grant | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,775,000 | ' | ' | ' | ' |
Equity_Employee_Stock_Purchase
Equity - Employee Stock Purchase Plan Narrative (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' |
Stock-based compensation expense | $3,000,000 | $2,300,000 | $9,800,000 | $7,500,000 |
Employee Stock Purchase Plans | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' |
Stock-based compensation expense | 0 | 0 | 0 | 0 |
Shares contingently issued under employee stock purchase plan | ' | ' | 0 | ' |
Employee Stock Option | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' |
Stock-based compensation expense | $1,100,000 | $1,200,000 | $3,600,000 | $3,700,000 |
Equity_Restricted_Stock_Units_
Equity - Restricted Stock Units Narrative (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' |
Stock-based compensation expense | $3,000,000 | $2,300,000 | $9,800,000 | $7,500,000 |
Total unrecognized compensation expense | 26,600,000 | ' | 26,600,000 | ' |
Restricted Stock Units | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' |
Shares granted during the period | ' | ' | 563,875 | ' |
Other than options - granted in period, weighted average fair value | ' | ' | $23.93 | ' |
Other than options - grant date fair value | ' | ' | 13,500,000 | ' |
Stock-based compensation expense | 1,900,000 | 1,100,000 | 6,200,000 | 3,800,000 |
Total unrecognized compensation expense | 18,500,000 | ' | 18,500,000 | ' |
Total unrecognized compensation expense weighted-average period | ' | ' | '1 year 6 months 15 days | ' |
Restricted Stock Units | Minimum | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' |
Vesting period | ' | ' | '3 years | ' |
Restricted Stock Units | Maximum | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' |
Vesting period | ' | ' | '4 years | ' |
Performance Shares | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' |
Shares granted during the period | ' | ' | 142,000 | ' |
Employee Stock Option | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' |
Stock-based compensation expense | 1,100,000 | 1,200,000 | 3,600,000 | 3,700,000 |
Total unrecognized compensation expense | $8,100,000 | ' | $8,100,000 | ' |
Total unrecognized compensation expense weighted-average period | ' | ' | '1 year 2 months 18 days | ' |
Equity_Summary_of_Restricted_S
Equity - Summary of Restricted Stock Units (Detail) (Restricted Stock Units, USD $) | 9 Months Ended |
Sep. 30, 2013 | |
Restricted Stock Units | ' |
Number of Shares | ' |
Beginning balance (in shares) | 825,068 |
Granted (in shares) | 563,875 |
Vested (in shares) | -301,241 |
Forfeited (in shares) | -53,425 |
Ending balance (in shares) | 1,034,277 |
Weighted Average Fair Value | ' |
Beginning balance (in USD per share) | $18.40 |
Granted (in USD per share) | $23.93 |
Vested (in USD per share) | $17.60 |
Forfeited (in USD per share) | $20.26 |
Ending balance (in USD per share) | $21.55 |
Income_Taxes_Income_Tax_Benefi
Income Taxes - Income Tax Benefit (Expense) (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Income Tax Expenses [Line Items] | ' | ' | ' | ' |
Current | ($20) | $15 | $171 | $78 |
Deferred | 25 | 13 | 83 | 65 |
Total | $5 | $28 | $254 | $143 |
Income_Taxes_Narrative_Detail
Income Taxes - Narrative (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
Income Taxes [Line Items] | ' | ' |
Deferred tax assets | $500,000 | $500,000 |
Deferred tax liabilities | 800,000 | 700,000 |
Unrecognized Tax Benefits | $0 | ' |