Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
In Billions, except Share data, unless otherwise specified | Dec. 31, 2013 | Feb. 21, 2014 | Jun. 30, 2013 |
Document Documentand Entity Information [Abstract] | ' | ' | ' |
Document Type | '10-K | ' | ' |
Amendment Flag | 'false | ' | ' |
Document Period End Date | 31-Dec-13 | ' | ' |
Document Fiscal Year Focus | '2013 | ' | ' |
Document Fiscal Period Focus | 'FY | ' | ' |
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 Well-known Seasoned Issuer | 'Yes | ' | ' |
Entity Current Reporting Status | 'Yes | ' | ' |
Entity Voluntary Filers | 'No | ' | ' |
Entity Common Stock, Shares Outstanding | ' | 55,061,744 | ' |
Entity Public Float | ' | ' | $1.70 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Current Assets | ' | ' |
Cash and cash equivalents | $149,727 | $57,293 |
Accounts receivable, net | 33,067 | 33,294 |
Inventories | 9,464 | 14,867 |
Prepaid expenses and other current assets | 5,940 | 4,482 |
Total current assets | 198,198 | 109,936 |
Property and equipment, net | 32,356 | 25,422 |
Intangible assets, net | 18,040 | 22,963 |
Goodwill | 37,536 | 37,536 |
Other assets | 1,825 | 2,202 |
Total assets | 287,955 | 198,059 |
Current Liabilities | ' | ' |
Accounts payable | 19,359 | 9,361 |
Accrued expenses and other current liabilities | 19,478 | 19,051 |
Deferred revenue | 900 | 5,445 |
Current portion of capital lease obligations | 2,637 | 0 |
Current portion of long-term debt | 0 | 14,429 |
Total current liabilities | 42,374 | 48,286 |
Capital lease obligations | 5,390 | 0 |
Long-term debt | 113,651 | 103,730 |
Other long-term liabilities | 1,943 | 1,867 |
Total liabilities | 163,358 | 153,883 |
Commitments and contingencies (Note 12) | ' | ' |
Stockholders’ Equity | ' | ' |
Preferred stock, $.001 par value: Authorized: 5,000,000 shares at December 31, 2013 and 2012. Issued and outstanding: zero shares at December 31, 2013 and 2012. | 0 | 0 |
Common stock, $.001 par value: Authorized: 100,000,000 shares at December 31, 2013 and 2012. Issued and outstanding: 54,870,424 and 48,359,063 shares at December 31, 2013 and 2012. | 55 | 48 |
Additional paid-in capital | 651,067 | 525,679 |
Accumulated deficit | -526,525 | -481,551 |
Total stockholders’ equity | 124,597 | 44,176 |
Total liabilities and stockholders’ equity | $287,955 | $198,059 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
Statement of Financial Position [Abstract] | ' | ' |
Preferred stock, par value | $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 | $0.00 | $0.00 |
Common stock, Authorized | 100,000,000 | 100,000,000 |
Common stock, Issued | 54,870,424 | 48,359,063 |
Common stock, outstanding | 54,870,424 | 48,359,063 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 12 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Income Statement [Abstract] | ' | ' | ' |
Revenue | $247,084 | $211,369 | $152,255 |
Cost of revenue | 134,683 | 119,033 | 85,543 |
Gross profit | 112,401 | 92,336 | 66,712 |
Operating expenses: | ' | ' | ' |
Research and development | 21,765 | 24,359 | 21,863 |
General and administrative | 64,077 | 51,240 | 44,083 |
Sales and marketing | 55,694 | 52,708 | 43,233 |
Total operating expenses | 141,536 | 128,307 | 109,179 |
Operating loss | -29,135 | -35,971 | -42,467 |
Interest income | 124 | 110 | 139 |
Other income | 1,351 | 0 | 0 |
Interest and other expense | -17,214 | -15,794 | -14,715 |
Other expense, net | -15,739 | -15,684 | -14,576 |
Loss before income taxes | -44,874 | -51,655 | -57,043 |
Income tax benefit (expense) | -100 | -212 | 11,212 |
Net loss | ($44,974) | ($51,867) | ($45,831) |
Net loss per share basic and diluted | ($0.83) | ($1.08) | ($0.98) |
Weighted-average number of shares used in calculating net loss per share | 54,010,887 | 47,924,324 | 46,689,880 |
Consolidated_Statements_of_Sto
Consolidated Statements of Stockholder's Equity (USD $) | Total | Common Stock | Additional Paid-in Capital | Accumulated Deficit |
In Thousands, except Share data | ||||
Beginning Balance at Dec. 31, 2010 | $66,231 | $45 | $450,039 | ($383,853) |
Beginning Balance (in shares) at Dec. 31, 2010 | ' | 45,440,839 | ' | ' |
Exercise of options to purchase common stock (in shares) | ' | 743,341 | ' | ' |
Exercise of options to purchase common stock | 5,242 | 1 | 5,241 | ' |
Issuance for employee stock purchase plan (in shares) | ' | 12,429 | ' | ' |
Issuance for employee stock purchase plan | 253 | ' | 253 | ' |
Stock-based compensation expense | 7,683 | ' | 7,683 | ' |
Restricted Stock, Shares Issued Net of Shares for Tax Withholdings | ' | 109,891 | ' | ' |
Restricted Stock, Value, Shares Issued Net of Tax Withholdings | -946 | ' | -946 | ' |
Issuance of common stock for acquisition, net of transaction (in shares) | ' | 1,197,631 | ' | ' |
Issuance of common stock for acquisition, net of transaction | 24,188 | 2 | 24,186 | ' |
Allocation of fair value of convertible debt to equity | 25,915 | ' | 25,915 | ' |
Net loss | -45,831 | ' | ' | -45,831 |
Ending Balance at Dec. 31, 2011 | 82,735 | 48 | 512,371 | -429,684 |
Ending Balance (in shares) at Dec. 31, 2011 | ' | 47,504,131 | ' | ' |
Exercise of options to purchase common stock (in shares) | ' | 676,819 | ' | ' |
Exercise of options to purchase common stock | 4,592 | ' | 4,592 | ' |
Issuance for employee stock purchase plan (in shares) | ' | 18,346 | ' | ' |
Issuance for employee stock purchase plan | 392 | ' | 392 | ' |
Stock-based compensation expense | 9,862 | ' | 9,862 | ' |
Restricted Stock, Shares Issued Net of Shares for Tax Withholdings | ' | 159,767 | ' | ' |
Restricted Stock, Value, Shares Issued Net of Tax Withholdings | -1,538 | ' | -1,538 | ' |
Net loss | -51,867 | ' | ' | -51,867 |
Ending Balance at Dec. 31, 2012 | 44,176 | 48 | 525,679 | -481,551 |
Ending Balance (in shares) at Dec. 31, 2012 | 48,359,063 | 48,359,063 | ' | ' |
Stock Issued During Period, Shares, New Issues | ' | 4,715,000 | ' | ' |
Stock Issued During Period, Value, New Issues | 97,800 | ' | ' | ' |
Ending Balance at Jan. 31, 2013 | ' | ' | ' | ' |
Beginning Balance at Dec. 31, 2012 | 44,176 | 48 | 525,679 | -481,551 |
Beginning Balance (in shares) at Dec. 31, 2012 | 48,359,063 | 48,359,063 | ' | ' |
Exercise of options to purchase common stock (in shares) | 872,073 | 872,073 | ' | ' |
Exercise of options to purchase common stock | 9,461 | 1 | 9,460 | ' |
Issuance for employee stock purchase plan (in shares) | ' | 12,970 | ' | ' |
Issuance for employee stock purchase plan | 445 | ' | 445 | ' |
Stock-based compensation expense | 12,616 | ' | 12,616 | ' |
Restricted Stock, Shares Issued Net of Shares for Tax Withholdings | ' | 217,281 | ' | ' |
Restricted Stock, Value, Shares Issued Net of Tax Withholdings | -3,265 | ' | -3,265 | ' |
Stock Issued During Period, Shares, New Issues | ' | 4,715,000 | ' | ' |
Stock Issued During Period, Value, New Issues | 92,812 | 5 | 92,807 | ' |
Exercise of warrants to purchase common stock | ' | 47,392 | ' | ' |
Stock Issued During Period, Shares, Conversion of Convertible Securities | ' | 646,645 | ' | ' |
Common stock issued in exchange for 5.375% Convertible Senior Notes | 13,326 | 1 | 13,325 | ' |
Net loss | -44,974 | ' | ' | -44,974 |
Ending Balance at Dec. 31, 2013 | $124,597 | $55 | $651,067 | ($526,525) |
Ending Balance (in shares) at Dec. 31, 2013 | 54,870,424 | 54,870,424 | ' | ' |
Consolidated_Statements_of_Sto1
Consolidated Statements of Stockholder's Equity (Parenthetical) (USD $) | 12 Months Ended |
In Millions, unless otherwise specified | Dec. 31, 2013 |
Statement of Stockholders' Equity [Abstract] | ' |
Issuance of common stock, net of offering costs | $5 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Cash flows from operating activities | ' | ' | ' |
Net loss | ($44,974) | ($51,867) | ($45,831) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities | ' | ' | ' |
Depreciation and amortization | 11,806 | 11,030 | 8,503 |
Non-cash interest and other expense | 10,056 | 10,212 | 9,736 |
Stock-based compensation expense | 12,683 | 9,920 | 7,734 |
Provision for bad debts | 4,741 | 3,409 | 3,165 |
Impairment and other charges | 2,511 | 0 | 0 |
Deferred tax provision | 0 | 0 | -11,289 |
Changes in operating assets and liabilities: | ' | ' | ' |
Accounts receivable | -4,514 | -13,513 | -3,617 |
Inventories | 5,403 | -3,029 | 1,879 |
Deferred revenue | -4,545 | 2,863 | -1,665 |
Prepaid expenses and other assets | -320 | -898 | 853 |
Accounts payable, accrued expenses and other current liabilities | 10,425 | 2,999 | 4,697 |
Other long-term liabilities | 76 | -185 | 383 |
Net cash provided by (used in) operating activities | 3,348 | -29,059 | -25,452 |
Cash flows from investing activities | ' | ' | ' |
Purchases of property and equipment | -7,307 | -10,991 | -11,114 |
Acquisition of Neighborhood Diabetes | 0 | 0 | -37,855 |
Net cash used in investing activities | -7,307 | -10,991 | -48,969 |
Cash flows from financing activities | ' | ' | ' |
Proceeds from issuance of long-term debt, net of issuance costs | 0 | 0 | 138,783 |
Principal payment of long-term debt | -2,000 | 0 | -88,195 |
Proceeds from issuance of common stock, net of offering costs | 102,652 | 4,927 | 5,460 |
Payment of withholding taxes in connection with vesting of restricted stock units | -3,265 | -1,539 | -946 |
Principal payments of capital lease obligations | -994 | 0 | 0 |
Net cash provided by financing activities | 96,393 | 3,388 | 55,102 |
Net increase (decrease) in cash and cash equivalents | 92,434 | -36,662 | -19,319 |
Cash and cash equivalents, beginning of year | 57,293 | 93,955 | 113,274 |
Cash and cash equivalents, end of year | 149,727 | 57,293 | 93,955 |
Supplemental disclosure of cash flow information | ' | ' | ' |
Cash paid for interest | 5,704 | 6,197 | 5,173 |
Cash paid for taxes | 321 | 11 | 263 |
Non-cash financing activities | ' | ' | ' |
Common stock issued in exchange for 5.375% Convertible Senior Notes | 13,000 | 0 | 0 |
Purchases of property and equipment under capital lease | 9,021 | 0 | 0 |
Issuance of common stock for the acquisition of Neighborhood Diabetes | $0 | $0 | $24,432 |
Nature_of_the_Business
Nature of the Business | 12 Months Ended |
Dec. 31, 2013 | |
Text Block [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 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 for the next generation OmniPod System from the FDA. 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 to new users in the first quarter of 2013 and began converting the existing customer base in the second quarter of 2013. At December 31, 2013, the Company completed the transition to the new OmniPod System. |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 12 Months Ended | |
Dec. 31, 2013 | ||
Text Block [Abstract] | ' | |
Summary of Significant Accounting Policies | ' | |
Summary of Significant Accounting Policies | ||
Use of Estimates in Preparation of Financial Statements | ||
The preparation of financial statements in conformity with generally accepted accounting principles in the United States 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 consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All material intercompany balances and transactions have been eliminated in consolidation. | ||
Certain Risks and Uncertainties | ||
The Company is subject to risks common to companies in the medical device industry, including, but not limited to, development by the Company or its competitors of new technological innovations, dependence on key personnel, reliance on third party manufacturers, protection of proprietary technology, and compliance with regulatory requirements. | ||
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. A single estimate of fair value results from a complex series of judgments about future events and uncertainties and relies heavily on estimates and assumptions. When estimating fair value, depending on the nature and complexity of the assets or liability, the Company may use one or all of the following approaches: | ||
• | Market approach, which is based on market prices and other information from market transactions involving identical or comparable assets or liabilities. | |
• | Cost approach, which is based on the cost to acquire or construct comparable assets less an allowance for functional and/or economic obsolescence. | |
• | Income approach, which is based on the present value of the future stream of net cash flows. | |
FASB 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 December 31, 2013 and 2012 are cash equivalents, consisting of money market accounts and long-term debt, which are based on Level 1 inputs and the June 2014 call feature on the modified portion of the 3.75% Notes which is based on Level 3 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. | ||
Cash and Cash Equivalents | ||
For the purposes of the financial statement classification, the Company considers all highly liquid investment instruments with original maturities of 90 days or less, when purchased, to be cash equivalents. Cash equivalents consist of money market accounts and are carried at cost which approximates their fair value. Outstanding letters of credit, principally relating to security deposits for lease obligations, totaled $0.1 million at December 31, 2013 and 2012. In January 2014, the Company obtained an additional $1.2 million letter of credit in connection with its new office lease in Billerica, Massachusetts. | ||
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 potential 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 at December 31, 2013 and 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 net realizable value 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 lives 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 and the amortization is included with depreciation expense. Maintenance and repair costs are expensed as incurred. | ||
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 finite-lived assets if the carrying amount of a long-lived 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 useful life of the acquired customer relationship asset is 10 years. Intangible assets with determinable estimated lives are amortized over these lives. | ||
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 follows the provisions of FASB ASC 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. 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. | ||
The Company continues to operate in one segment, which is considered to be the sole reporting unit and therefore, goodwill was tested for impairment at the enterprise level. To test for impairment, the Company has elected to first assess the qualitative factors to determine whether it is more likely than not that the fair value of its sole reporting unit is less than its carrying amount. This qualitative analysis is used as a basis for determining whether it is necessary to perform the two-step goodwill impairment analysis. If the Company determines that it is more likely than not that its fair value is less than its carrying amount, then the two-step goodwill impairment test will be performed. The first step, 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. No goodwill impairment was recorded in the year ended December 31, 2013. | ||
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 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 products and new versions of existing products, the Company also considers the anticipated performance of the product over its warranty period in estimating warranty reserves. | ||
Impairment of Assets | ||
In connection with its efforts to pursue improved gross margins, leverage operational efficiencies and better pursue opportunities for low-cost supplier sourcing, the Company periodically performs an evaluation of its manufacturing processes and reviews the carrying value of its property and equipment to assess the recoverability of these assets whenever events indicate that impairment may have occurred. As part of this assessment, the Company reviews the future undiscounted operating cash flows expected to be generated by those assets. If impairment is indicated through this review, the carrying amount of the asset would be reduced to its estimated fair value. This review of manufacturing processes and equipment can result in an impairment of assets based on current net book value and potential future use of the assets. In the year ended December 31, 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. | ||
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 collectibility 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 its 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 collectibility 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 was 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 invoiced amounts based upon meeting certain deliverable milestones. Revenue on 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 $0.9 million and $5.4 million as of December 31, 2013 and 2012, respectively. The deferred revenue recorded was primarily comprised of product-related revenue and unrecognized amounts related to the Development Agreement. | ||
Shipping and Handling Costs | ||
The Company does not typically charge its customers for shipping and handling costs associated with shipping its product to its customers. These shipping and handling costs are included in general and administrative expenses. | ||
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 December 31, 2013 and 2012, liabilities from one vendor represented approximately 36% and 19% of the combined balance of accounts payable, accrued expenses and other current liabilities, respectively. | ||
Research and Development Expenses | ||
The Company’s research and development expenses consist of engineering, product development, quality assurance, clinical and regulatory expenses. These expenses are primarily related to employee compensation, including salary, benefits and stock-based compensation. The Company also incurs expenses related to consulting fees, materials and supplies, and clinical studies, including data management and associated travel expenses. Research and development costs are expensed as incurred. | ||
General and Administrative Expenses | ||
General and administrative expenses are primarily comprised of salaries and benefits associated with finance, legal and other administrative personnel, overhead and occupancy costs, outside legal costs, and other general and administrative costs. | ||
Sales and Marketing Expenses | ||
Sales and marketing expenses are primarily comprised of salaries and benefits associated with sales and marketing personnel, outside marketing expenses including commercial product samples, tradeshows and advertising expenses. | ||
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. As the Company sells a single product type, management operates the business as a single entity. | ||
Income Taxes | ||
The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. 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 effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. | ||
The Company follows the provisions of FASB ASC 740-10, Income Taxes (“ASC 740-10”) on 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, disclosure and transition. The Company had no unrecognized tax benefits as of December 31, 2013 and $0.1 million of unrecognized tax benefits as of December 31, 2012. The Company recognizes estimated interest and penalties for uncertain tax positions in income tax expense. In the years ended December 31, 2012 and 2011, interest and tax penalties were immaterial to the 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 tax 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 and restricted stock units, 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 and 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 vesting period 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 the 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. | ||
In the years ended December 31, 2013, 2012, and 2011, the Company recorded $12.7 million, $9.9 million, and $7.7 million of stock-based compensation expense, respectively. | ||
See Footnote 13 for a summary of the stock option activity under the Company’s stock-based employee compensation plan. | ||
Recent Accounting Pronouncements | ||
In December 2011, the FASB issued ASU No. 2011-11, Disclosures about Offsetting Assets and Liabilities. ASU 2011-11 will require disclosure of information about offsetting and related arrangements to enable users of the Company’s financial statements to understand the effect of those arrangements on its financial position. The guidance is effective in fiscal years beginning after January 1, 2013. 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. | ||
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. |
Fair_Value_Measurements
Fair Value Measurements | 12 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Fair Value Disclosures [Abstract] | ' | |||||||||||||||
Fair Value Measurements | ' | |||||||||||||||
Fair Value Measurements | ||||||||||||||||
ASC 820, which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. ASC 820 defines fair value as the exit price that would be received to sell an asset or paid to transfer a liability. Fair value is market-based measurement that should be determined using assumptions that market participants would use in pricing an asset or liability. Valuation techniques used to measure fair value should maximize the use of observable inputs and minimize the use of unobservable inputs. To measure fair value, the Company uses the following fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable: | ||||||||||||||||
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 | ||||||||||||||||
Fair value under ASC 820 is principally applied to financial assets which consist of investments in money market funds and the call feature on the modified portion of the 3.75% Notes. The following table provides a summary of financial assets that are measured at fair value on a recurring basis as of December 31, 2013, aggregated by the level in the fair value hierarchy within which those measurements fall (in thousands): | ||||||||||||||||
Fair Value Measurements | ||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | |||||||||||||
Assets | ||||||||||||||||
Cash Equivalents - Money Market Funds | $ | 128,308 | $ | 128,308 | $ | — | $ | — | ||||||||
Other Asset - Call feature on 3.75% Notes | $ | 1,351 | $ | — | $ | — | $ | 1,351 | ||||||||
The following table provides a summary of financial assets that are measured at fair value on a recurring basis as of December 31, 2012, aggregated by the level in the fair value hierarchy within those those measurements fall (in thousands): | ||||||||||||||||
Fair Value Measurements | ||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | |||||||||||||
Assets | ||||||||||||||||
Cash Equivalents - Money Market Funds | $ | 50,251 | $ | 50,251 | $ | — | $ | — | ||||||||
Other Asset - Call feature on 3.75% Notes | $ | — | $ | — | $ | — | $ | — | ||||||||
Cash and Cash Equivalents | ||||||||||||||||
The fair value of cash and cash equivalents is estimated on the quoted market price of the investments. The carrying amount of the Company's cash equivalents approximate their fair value due to the short-term maturity of these instruments. | ||||||||||||||||
Other Asset | ||||||||||||||||
The Company's financial assets include a call feature on the $59.5 million of modified 3.75% Notes which was valued at December 31, 2013 using Level 3 inputs. The value of this feature was not material at December 31, 2012. Gains and losses recognized on changes in fair value of the asset are reported in other income (expense). The valuation of this feature was measured at fair value using a trinomial lattice model which incorporates the terms and conditions of the 3.75% Notes and estimates the fair value based on changes in the price of the underlying equity over successive periods of time. This lattice model is considered to be a single-factor model, in that it solely incorporates uncertainty related to the Company’s stock price and values the option to convert the note into common stock using a trinomial structure. This value was recorded as other income in the year ended December 31, 2013. The key assumptions used in the lattice model valuation for the call feature at December 31, 2013 were as follows: | ||||||||||||||||
Term to Maturity (years) | 2.46 | |||||||||||||||
Bond Inputs: | ||||||||||||||||
Bond Yield | 8.61% | |||||||||||||||
Coupon Rate | 3.75% | |||||||||||||||
Conversion Price | $26.20 | |||||||||||||||
Bond Call Strike Price | $100.00 | |||||||||||||||
Stock Inputs: | ||||||||||||||||
Stock Price | $37.10 | |||||||||||||||
Risk Free Rate | 0.56% | |||||||||||||||
Volatility | 38.00% | |||||||||||||||
Dividend Yield | —% | |||||||||||||||
The estimated yield is based on a trinomial single-factor convertible bond model which takes into account the conversion option and the call option. The risk free interest rate is based on United States Treasury rates with maturity dates approximating the expected term to maturity of the 3.75% Notes. The expected volatility considers the Company’s historical volatility with a lookback period commensurate with years to maturity of the notes and the implied volatility using call option contracts on the Company’s stock. The Company's stock price increased 75% from $21.22 at December 31, 2012 to $37.10 at December 31, 2013. The increase in the stock price is the principal driver of the increase in value of the call feature over the same period of time. | ||||||||||||||||
Debt | ||||||||||||||||
The estimated fair value of debt is based on the Level 1 quoted market prices for the same or similar issues. | ||||||||||||||||
The carrying amounts and the estimated fair values of financial instruments as of December 31, 2013 and 2012, are as follows (in thousands): | ||||||||||||||||
31-Dec-13 | 31-Dec-12 | |||||||||||||||
Carrying | Estimated Fair | Carrying | Estimated Fair | |||||||||||||
Value | Value | Value | Value | |||||||||||||
Debt | $ | 113,651 | $ | 211,370 | $ | 118,159 | $ | 174,428 | ||||||||
The carrying value of the notes at December 31, 2013 and 2012, includes a reclassification to equity of $52.4 million which is being amortized as non-cash interest expense over the term of the notes. The estimated fair values of these liabilities are based on quoted market prices. |
Debt
Debt | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Debt Disclosure [Abstract] | ' | |||||||||||
Debt | ' | |||||||||||
Debt | ||||||||||||
At December 31, 2013 and 2012, the Company had outstanding convertible debt and related deferred financing costs on its balance sheet as follows (in thousands): | ||||||||||||
As of 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 | (30,099 | ) | (40,591 | ) | ||||||||
Total long-term debt | 113,651 | 118,159 | ||||||||||
Current portion of long-term debt | — | 14,429 | ||||||||||
Long-term debt | $ | 113,651 | $ | 103,730 | ||||||||
Deferred financing costs | $ | 1,414 | $ | 2,004 | ||||||||
Interest expense related to the 5.375% Senior Notes (as defined below) and the 3.75% Senior Notes (as defined below) was included in interest expense on the consolidated statements of operations as follows (in thousands): | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Contractual coupon interest | $ | 5,704 | $ | 6,197 | $ | 5,383 | ||||||
Accretion of debt discount | 10,492 | 9,619 | 7,213 | |||||||||
Other interest payments | — | — | 1,991 | |||||||||
Loss on debt extinguishment | 325 | — | — | |||||||||
Amortization of debt issuance costs | 590 | 593 | 532 | |||||||||
Total interest expense | $ | 17,111 | $ | 16,409 | $ | 15,119 | ||||||
The Company expects to pay cash interest of $5.4 million in each of 2014 and 2015, and $2.5 million in 2016. Additionally, $143.8 million related to the 3.75% Notes is due to the holders in 2016. | ||||||||||||
5.375% Convertible Senior Notes | ||||||||||||
In June 2008, the Company sold $85.0 million 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 being amortized as 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 was 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. The 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 the section entitled “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 for the impact of the inducement which was included in interest and other expense in the year ended December 31, 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 in accordance with the terms of the 5.375% Notes. | ||||||||||||
Cash interest expense related to the 5.375% Notes was $0.3 million, $0.8 million, and $2.7 million for the years ended December 31, 2013, 2012, and 2011, respectively. | ||||||||||||
As of December 31, 2013, the 5.375% Notes were repaid in full and no amounts remained 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 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. For the quarter ending March 31, 2014, the 3.75% Notes are convertible at the option of the holder since the last reported sales price per share of the Company's common stock was equal to or greater than 130% of the conversion price for at least 20 of the 30 trading days ended on December 31, 2013. Based on the terms of the 3.75% Notes the Company has the ability to convert using 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. 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 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 25, 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 the Company’s 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 December 31, 2013, the Company separately accounted for the call feature related to the possibility that it can redeem the 3.75% Notes, at the Company's option, beginning June 20, 2014, for the modified portion of the 3.75% Notes. The Company determined that the fair value of this feature was approximately $1.4 million and was recorded as other income at December 31, 2013. The Company determined that the remaining 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 $5.4 million, in the years ended December 31, 2013 and 2012 and $2.7 million in the year ended December 31, 2011. | ||||||||||||
As of December 31, 2013, the Company included $113.7 million on its balance sheet in long-term debt related to the 3.75% Notes. As such instruments are convertible into stock and the Company does not plan to use working capital to satisfy the obligation, the notes remain classified as long-term. As of December 31, 2013, the 3.75% Notes have a remaining term of two and a half years. |
Capital_Lease_Obligations
Capital Lease Obligations | 12 Months Ended | ||||||
Dec. 31, 2013 | |||||||
Leases [Abstract] | ' | ||||||
Capital Lease Obligations | ' | ||||||
Capital Lease Obligations | |||||||
In the year ended December 31, 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 year ended December 31, 2013, the Company recorded a $2.5 million charge to expense the value of the 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 December 31, 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. Amortization expense related to these capital leased assets was $0.6 million in the year ended December 31, 2013. No amortization expense was recorded on the leased assets in the years ended December 31, 2012 and 2011. | |||||||
Assets held under capital leases consist of the following (in thousands): | |||||||
As of December 31, | |||||||
2013 | 2012 | ||||||
Manufacturing equipment | $ | 6,510 | $ | — | |||
Less: Accumulated depreciation | (582 | ) | — | ||||
Total | $ | 5,928 | $ | — | |||
The aggregate future minimum lease payments related to these capital leases as of December 31, 2013, are as follows (in thousands): | |||||||
Year Ending | Minimum Lease Payments | ||||||
December 31, | |||||||
2014 | 3,815 | ||||||
2015 | 3,815 | ||||||
2016 | 2,409 | ||||||
Total future minimum lease payments | 10,039 | ||||||
Interest expense | (2,012 | ) | |||||
Total Capital lease obligation | 8,027 | ||||||
The Company recorded $0.4 million of interest expense on capital leases in the year ended December 31, 2013. No interest expense was recorded on capital leases in the years ended December 31, 2012 and 2011. |
Net_Loss_Per_Share
Net Loss Per Share | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Text Block [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 stock units. 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 years ended December 31, 2013, 2012 and 2011, all potential common shares have been excluded from the computation of the diluted net loss per share for all periods presented because the effect would have been anti-dilutive. Potential dilutive common share equivalents consist of the following: | |||||||||
Year Ended December 31, | |||||||||
2013 | 2012 | 2011 | |||||||
5.375% Convertible Senior Notes | — | 702,701 | 702,701 | ||||||
3.75% Convertible Senior Notes | 5,487,642 | 5,487,642 | 5,487,642 | ||||||
Unvested restricted stock units | 1,011,893 | 825,068 | 603,882 | ||||||
Outstanding options | 1,828,613 | 2,502,190 | 2,814,591 | ||||||
Outstanding warrants | — | 62,752 | 62,752 | ||||||
Total dilutive common shares | 8,328,148 | 9,580,353 | 9,671,568 | ||||||
Accounts_Receivable
Accounts Receivable | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Text Block [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 December 31, 2013, accounts receivable from two customers represented approximately 12% and 10% of gross accounts receivable, respectively. 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 (in thousands): | ||||||||
As of December 31, | ||||||||
2013 | 2012 | |||||||
Trade receivables | $ | 40,200 | $ | 39,921 | ||||
Allowance for doubtful accounts | (7,133 | ) | (6,627 | ) | ||||
Total accounts receivable | $ | 33,067 | $ | 33,294 | ||||
Bad debt expense for the years ended December 31, 2013, 2012 and 2011 amounted to $4.7 million, $3.4 million, and $3.2 million, respectively. |
Inventories
Inventories | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Text Block [Abstract] | ' | |||||||
Inventories | ' | |||||||
Inventories | ||||||||
Inventories consist of the following (in thousands): | ||||||||
As of December 31, | ||||||||
2013 | 2012 | |||||||
Raw materials | $ | 399 | $ | 1,487 | ||||
Work-in-process | 1,671 | 1,595 | ||||||
Finished goods | 7,394 | 11,785 | ||||||
Total inventories | $ | 9,464 | $ | 14,867 | ||||
Property_and_Equipment
Property and Equipment | 12 Months Ended | |||||||||
Dec. 31, 2013 | ||||||||||
Property, Plant and Equipment [Abstract] | ' | |||||||||
Property and Equipment | ' | |||||||||
Property and Equipment | ||||||||||
Property and equipment consist of the following (in thousands): | ||||||||||
Estimated | As of | |||||||||
Useful Life | December 31, | |||||||||
(Years) | 2013 | 2012 | ||||||||
Machinery and equipment | 5-Feb | $ | 48,814 | $ | 28,879 | |||||
Lab equipment | 2 | 1,481 | 1,481 | |||||||
Computers | 3 | 3,796 | 3,558 | |||||||
Software | 3 | 4,813 | 4,670 | |||||||
Office furniture and fixtures | 5-Mar | 2,048 | 2,045 | |||||||
Leasehold improvement | * | 2,971 | 2,899 | |||||||
Construction in process | — | 2,895 | 9,817 | |||||||
Total property and equipment | $ | 66,818 | $ | 53,349 | ||||||
Less: Accumulated depreciation | (34,462 | ) | (27,927 | ) | ||||||
Total property and equipment | $ | 32,356 | $ | 25,422 | ||||||
_________________________ | ||||||||||
* Lesser of lease term or useful life of asset | ||||||||||
Depreciation expense related to property and equipment was $6.9 million, $5.0 million, and $4.6 million for the years ended December 31, 2013, 2012 and 2011, respectively. The Company recorded $0.3 million, $0.6 million, and $0.4 million of capitalized interest for the years ended December 31, 2013, 2012 and 2011, respectively. | ||||||||||
Construction in process mainly consists of infrastructure improvements. Depreciation on the computer equipment and software does not begin until the assets are integrated into the current systems. | ||||||||||
As of December 31, 2013, machinery and equipment included $6.5 million of capital leases assets. |
Other_Intangible_Assets
Other Intangible Assets | 12 Months Ended | |||||||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | |||||||||||||||||||||||
Other Intangible Assets | ' | |||||||||||||||||||||||
Other Intangible Assets | ||||||||||||||||||||||||
Other intangible assets consist of the following (in thousands): | ||||||||||||||||||||||||
As of December 31, | ||||||||||||||||||||||||
2013 | 2012 | |||||||||||||||||||||||
Cost | Accumulated | NBV | Cost | Accumulated | NBV | |||||||||||||||||||
Amortization | Amortization | |||||||||||||||||||||||
Customer relationships | $ | 30,100 | $ | (14,378 | ) | $ | 15,722 | $ | 30,100 | $ | (9,641 | ) | $ | 20,459 | ||||||||||
Tradename | 2,800 | (482 | ) | 2,318 | 2,800 | (296 | ) | 2,504 | ||||||||||||||||
Total intangible assets | $ | 32,900 | $ | (14,860 | ) | $ | 18,040 | $ | 32,900 | $ | (9,937 | ) | $ | 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 ten years and is amortizing the asset over the period using an estimated cash flow pattern. The Company determined that the estimated useful life of the tradename is 15 years and is amortizing the asset over that period on a straight-line basis. The amortization expense related to other intangible assets was approximately $4.9 million, $6.0 million, and $3.9 million for the years ended December 31, 2013, 2012 and 2011, respectively. | ||||||||||||||||||||||||
Amortization expense expected for the next five years is as follows (in thousands): | ||||||||||||||||||||||||
Amortization Expense | ||||||||||||||||||||||||
Year Ending December 31, | Customer | Tradename | Total | |||||||||||||||||||||
Relationships | ||||||||||||||||||||||||
2014 | $ | 3,790 | $ | 187 | $ | 3,977 | ||||||||||||||||||
2015 | 3,064 | 187 | 3,251 | |||||||||||||||||||||
2016 | 2,478 | 187 | 2,665 | |||||||||||||||||||||
2017 | 2,003 | 187 | 2,190 | |||||||||||||||||||||
2018 | 1,619 | 187 | 1,806 | |||||||||||||||||||||
Thereafter | 2,768 | 1,383 | 4,151 | |||||||||||||||||||||
Total | 15,722 | 2,318 | 18,040 | |||||||||||||||||||||
As of December 31, 2013, the weighted average amortization period of the Company’s intangible assets is approximately eight years. |
Accrued_Expenses_and_Other_Cur
Accrued Expenses and Other Current Liabilities | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Accrued Liabilities and Other Liabilities [Abstract] | ' | |||||||
Accrued Expenses and Other Current Liabilities | ' | |||||||
Accrued Expenses and Other Current Liabilities | ||||||||
Accrued expenses and other current liabilities consist of the following (in thousands): | ||||||||
As of | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
Employee compensation and related items | $ | 6,887 | $ | 6,789 | ||||
Professional and consulting services | 2,437 | 2,069 | ||||||
Sales and use tax | 3,928 | 3,965 | ||||||
Supplier charges | 1,850 | 1,752 | ||||||
Interest expense | 225 | 258 | ||||||
Warranty reserve | 1,173 | 863 | ||||||
Training | 717 | 455 | ||||||
Other | 2,261 | 2,900 | ||||||
Total accrued expenses and other current liabilities | $ | 19,478 | $ | 19,051 | ||||
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 recorded in the period that shipment occurs. The expense is based on 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 (in thousands): | ||||||||
Year Ended | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
Balance at the beginning of year | $ | 1,992 | $ | 1,960 | ||||
Warranty expense | 4,065 | 2,666 | ||||||
Warranty claims settled | (2,967 | ) | (2,634 | ) | ||||
Balance at the end of the year | $ | 3,090 | $ | 1,992 | ||||
Composition of balance: | ||||||||
Short-term | $ | 1,173 | $ | 863 | ||||
Long-term | 1,917 | 1,129 | ||||||
Total warranty balance | $ | 3,090 | $ | 1,992 | ||||
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended | |||
Dec. 31, 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 leases for the Company's facilities in Bedford and Billerica, Massachusetts expire in September 2014. The leases for Bedford contain 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 offices spaces in Bedford, Massachusetts. The lease termination resulted in no material impact to the financial statements for the year ended December 31, 2012. During the same period, the Company entered into a new lease agreement for an additional 26,500 square feet in Bedford, Massachusetts. The lease expires in September 2014 and includes escalating rent payments over its term. During the year ended December 31, 2013, the Company extended the lease of its Woburn, Florida, and Singapore locations. Following the extensions, both the Woburn and Florida leases expire in December 2014 and the Singapore lease expires in July 2015. The lease in New York expires in April 2015. During the year ended December 31, 2013, the Company entered into a new lease agreement for approximately 90,000 square feet of laboratory and office space in Billerica, Massachusetts. The lease term is expected to begin in August 2014 and is expected to expire in October 2022. The execution of this lease did not result in any material impact to the financial statements for the year ended December 31, 2013. | ||||
Certain of the Company’s operating lease agreements contain scheduled rent increases, which are being amortized over the terms of the agreement using the straight-line method and are included in other liabilities in the accompanying balance sheet. The Company has considered FASB ASC 840-20, Leases in accounting for these lease provisions. | ||||
The aggregate future minimum lease payments of these leases as of December 31, 2013, are as follows (in thousands): | ||||
Year Ending December 31, | Minimum | |||
Lease Payments | ||||
2014 | $ | 1,433 | ||
2015 | 1,974 | |||
2016 | 1,934 | |||
2017 | 2,012 | |||
2018 | 2,012 | |||
Thereafter | 8,150 | |||
Total | $ | 17,515 | ||
Rent expense of approximately $1.6 million, $1.7 million, and $1.3 million was charged to operations in the years ended December 31, 2013, 2012 and 2011, respectively. | ||||
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 subsequently withdrew its claims with respect to one of those patents. With respect to the remaining two patents, which expire on March 9, 2014, BD seeks a declaration that the Company has infringed certain claims of those patents and an award for monetary damages based upon a reasonable royalty. 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 at December 31, 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 sought 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. In December 2013, the Company entered into a Settlement and Patent License Agreement with Rydex and paid an immaterial amount to Rydex. The settlement granted the Company a fully paid license to use the patents included in the lawsuit and released it from any future claims related to the patents. | ||||
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 responded to this letter, stating 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 December 31, 2013. | ||||
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 under such indemnification obligations 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 December 31, 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 | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
Equity [Abstract] | ' | |||||||||||||
Equity | ' | |||||||||||||
Equity | ||||||||||||||
In June 2011, in connection with the acquisition of Neighborhood Diabetes, the Company issued 1,197,631 shares of its common stock at a price of $20.40 per share, as partial consideration for the acquisition. | ||||||||||||||
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 in accordance with the terms of the 5.375% Notes. | ||||||||||||||
In November 2013, the Company issued 47,392 shares of its common stock as a result of the exercise of warrants. | ||||||||||||||
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 years ended December 31, 2013, 2012, and 2011 was $12.7 million, $9.9 million, and $7.7 million, respectively, and was calculated based on awards ultimately expected to vest. At December 31, 2013, the Company had $25.2 million of total unrecognized compensation expense related to unvested stock options and restricted stock units. | ||||||||||||||
Stock Options | ||||||||||||||
In May 2007, upon the closing of the Company’s initial public offering, the Company’s 2007 Stock Option and Incentive Plan (the “2007 Plan”) became effective and the Company’s Board of Directors determined not to make any further grants under the Company’s 2000 Stock Option and Incentive Plan. Under the 2007 Plan, awards may be granted to persons who are, at the time of grant, employees, officers, non-employee directors or key persons (including consultants and prospective employees) of the Company. The 2007 Plan provides for the granting of stock options, restricted stock units, stock appreciation rights, deferred stock awards, restricted stock, unrestricted stock, cash-based awards, performance share awards or dividend equivalent rights. Options granted under the 2007 Plan generally vest over a period of four years and expire ten years from the date of grant. The Company had 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 changes to certain other provisions. In May 2012, shares available for grant under the 2007 Plan were increased by 3,775,000 shares. At December 31, 2013, 3,203,111 shares remain available for future issuance under the 2007 Plan. | ||||||||||||||
Under the Company’s 2000 Stock Option and Incentive Plan (the “2000 Plan”), options could be granted to persons who were, at the time of grant, employees, officers, or directors of, or consultants or advisors to, the Company. The 2000 Plan provided for the granting of non-statutory stock options, incentive stock options, stock bonuses, and rights to acquire restricted stock. The option price at the date of grant was determined by the Board of Directors and, in the case of incentive stock options, could not be less than the fair market value of the common stock at the date of grant, as determined by the Board of Directors. Options granted under the 2000 Plan generally vest over a period of four years and expire ten years from the date of grant. The provisions of the 2000 Plan limit the exercise of incentive stock options. At the time of grant, options are typically immediately exercisable, but subject to restrictions. The restrictions generally lapse over a period of four years. | ||||||||||||||
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 | 282,400 | 25.79 | ||||||||||||
Exercised | (872,073 | ) | 10.67 | $ | 17,820 | (1 | ) | |||||||
Canceled | (83,904 | ) | 19.94 | |||||||||||
Balance, December 31, 2013 | 1,828,613 | $ | 16.46 | $ | 37,742 | |||||||||
Vested, December 31, 2013 | 1,115,339 | $ | 13.42 | $ | 26,413 | (2 | ) | |||||||
Vested and expected to vest, December 31, 2013(3) | 1,562,587 | $ | 33,349 | (2 | ) | |||||||||
_________________________ | ||||||||||||||
-1 | The aggregate intrinsic value was calculated based on the positive difference between the estimated fair value of the Company’s common stock as of the date of exercise and the exercise price of the underlying options. The aggregate intrinsic value of options exercised in the years ended December 31, 2013, 2012 and 2011, was $17.8 million, $9.0 million and $8.8 million, respectively. | |||||||||||||
-2 | The aggregate intrinsic value was calculated based on the positive difference between the estimated fair value of the Company’s common stock as of December 31, 2013, and the exercise price of the underlying options. | |||||||||||||
-3 | Represents the number of vested options as of December 31, 2013, plus the number of unvested options expected to vest as of December 31, 2013, based on the unvested options outstanding at December 31, 2013, adjusted for the estimated forfeiture rate of 16%. | |||||||||||||
At December 31, 2013, there were 1,828,613 options outstanding with a weighted average exercise price of $16.46 and a weighted average remaining contractual life of 6.8 years. At December 31, 2013, there were 1,115,339 options exercisable with a weighted average exercise price of $13.42 and a weighted average remaining contractual life of 5.7 years. | ||||||||||||||
The Company recognizes compensation expense for all share-based payment awards made to its employees, directors and consultants. Stock-based compensation expense recognized is based on the value of the portion of stock-based awards that is ultimately expected to vest. The Company recognizes the value of stock-based compensation in operating expense using the straight-line method. | ||||||||||||||
The Company uses the Black-Scholes option pricing model to determine the fair value of stock options. The determination of the fair value of stock-based payment awards on the date of grant using a pricing model is affected by the Company’s stock price as well as assumptions regarding a number of complex and subjective variables. The estimated grant date fair values of the employee stock options were calculated using the Black-Scholes option pricing model, based on the following assumptions: | ||||||||||||||
Year Ended December 31, | ||||||||||||||
2013 | 2012 | 2011 | ||||||||||||
Risk-free interest rate | 0.93% - 1.91% | 0.80% - 1.16% | 1.16% - 2.61% | |||||||||||
Expected term (in years) | 6.25 | 6.25 | 6.25 | |||||||||||
Dividend yield | — | — | — | |||||||||||
Expected volatility | 63% - 66% | 67% - 71% | 72% - 76% | |||||||||||
Risk-free interest rate. The risk-free interest rate is based on U.S. Treasury zero-coupon issues with remaining terms similar to the expected term on the options. | ||||||||||||||
Expected volatility. Expected volatility measures the amount that a stock price has fluctuated or is expected to fluctuate during a period. | ||||||||||||||
Expected term. The expected term of stock options represents the period the stock options are expected to remain outstanding and is based on the midpoint between the vesting date and the end of the contractual term. | ||||||||||||||
Dividend yield. The Company has never declared or paid any cash dividends and does not plan to pay cash dividends in the foreseeable future, and, therefore, used an expected dividend yield of zero in the valuation model. | ||||||||||||||
Forfeitures. Forfeitures are estimated at the time of grant and revised in subsequent periods if actual forfeitures differ from those estimates. The Company uses historical data to estimate pre-vesting option forfeitures and record stock-based compensation expense only for those awards that are expected to vest. If the Company’s actual forfeiture rate is materially different from its estimate, the stock-based compensation expense could be significantly different from what the Company has recorded in the current period. | ||||||||||||||
The weighted average grant date fair value of options granted for the years ended December 31, 2013, 2012 and 2011 was $15.42, $12.04, and $11.75, respectively. Stock-based compensation expense related to stock options recognized in the years ended December 31, 2013, 2012 and 2011 was $4.6 million, $4.8 million, and $4.4 million, respectively, and was calculated based on awards ultimately expected to vest. | ||||||||||||||
At December 31, 2013, the Company had $7.9 million of total unrecognized compensation expense related to stock options under FASB ASC 718-10 that will be recognized over a weighted-average period of 1.0 years. | ||||||||||||||
2007 Employee Stock Purchase Plan | ||||||||||||||
The 2007 Employee Stock Purchase Plan (“2007 ESPP”) was adopted by the Board of Directors and approved by stockholders in April 2007 and became effective upon the closing of the initial public offering in May 2007. The 2007 ESPP authorizes the issuance of up to a total of 380,000 shares of common stock to participating employees. | ||||||||||||||
All employees who have been employed by the Company for at least six months and whose customary employment is for more than 20 hours a week are eligible to participate in the 2007 ESPP. Any employee who owns 5% or more of the voting power or value of shares of the Company’s common stock is not eligible to purchase shares under the 2007 ESPP. | ||||||||||||||
The Company will make one or more offerings each year to employees to purchase stock under the 2007 ESPP. Offerings usually begin on each January 1 and July 1 and continue for six-month periods, referred to as offering periods. Each employee eligible to participate on the date of the closing of the initial public offering was automatically deemed to be a participant in the initial offering period. | ||||||||||||||
Each employee who is a participant in the Company’s 2007 ESPP may purchase shares by authorizing payroll deductions of up to 10% of his or her cash compensation during an offering period. Unless the participating employee has previously withdrawn from the offering, his or her accumulated payroll deductions will be used to purchase common stock on the last business day of the offering period at a price equal to 85% of the fair market value of the common stock on the last day of the offering period. Under applicable tax rules, an employee may purchase no more than $25,000 worth of common stock, valued at the start of the purchase period, under the 2007 ESPP in any calendar year. | ||||||||||||||
The accumulated payroll deductions of any employee who is not a participant on the last day of an offering period will be refunded. An employee’s rights under the 2007 ESPP terminate upon voluntary withdrawal from the plan or when the employee ceases employment with the Company for any reason. | ||||||||||||||
The 2007 ESPP may be terminated or amended by the Board of Directors at any time. An amendment to increase the number of shares of common stock that is authorized under the 2007 ESPP and certain other amendments require the approval of stockholders. | ||||||||||||||
The Company issued 12,970 shares of common stock in 2013, 18,346 shares of common stock in 2012, and 12,429 shares of common stock in 2011 to employees participating in the 2007 ESPP. The Company recorded $67,000, $59,000 and $38,000 of stock-based compensation expense related to the 2007 ESPP for the years ended December 31, 2013, 2012 and 2011, respectively. | ||||||||||||||
Restricted Stock Units | ||||||||||||||
In the year ended December 31, 2013, the Company awarded 588,875 restricted stock units to certain employees. The restricted stock units were granted under the 2007 Plan and vest annually over three to four years from the grant date. Included within the 588,875 awarded were 142,000 restricted stock units which vest based on the achievement of performance conditions through December 31, 2013 and service conditions through fiscal 2016. The restricted stock units granted have a weighted average fair value of $24.49 per share based on the closing price of the Company’s common stock on the date of grant. The restricted stock units were valued at approximately $14.4 million at their grant dates, and the Company recognizes the compensation expense of the restricted stock units expected to vest over the three to four year vesting period. The Company recognizes the value of stock-based compensation in operating expense using the straight-line method for awards with only service conditions and on an accelerated method for awards with performance conditions. Approximately $8.0 million, $5.1 million and $3.3 million of stock-based compensation expense related to the vesting of restricted stock units was recognized in the years ended December 31, 2013, 2012 and 2011, respectively. Approximately $17.3 million of the fair value of the restricted stock units remained unrecognized as of December 31, 2013, and will be recognized over a weighted average period of 1.3 years. Under the terms of the award, the Company will issue shares of common stock on each of the vesting dates. The following table summarizes the status of the Company’s restricted stock units: | ||||||||||||||
Number of | Weighted | |||||||||||||
Shares (#) | Average | |||||||||||||
Fair Value ($) | ||||||||||||||
Balance, December 31, 2012 | 825,068 | $ | 18.4 | |||||||||||
Granted | 588,875 | 24.49 | ||||||||||||
Vested | (338,325 | ) | 17.43 | |||||||||||
Forfeited | (63,725 | ) | 20.94 | |||||||||||
Balance, December 31, 2013 | 1,011,893 | $ | 22.11 | |||||||||||
Stock-based Compensation Associated with Awards for Non-Employees | ||||||||||||||
Shareholder Rights Plan | ||||||||||||||
In November 2008, the Board of Directors of the Company adopted a shareholder rights plan (the "Shareholder Rights Plan”), as set forth in the Shareholder Rights Agreement between the Company and the rights agent, the purpose of which is, among other things, to enhance the ability of the Board of Directors to protect shareholder interests and to ensure that shareholders receive fair treatment in the event any coercive takeover attempt of the Company is made in the future. The Shareholder Rights Plan could make it more difficult for a third party to acquire, or could discourage a third party from acquiring, the Company or a large block of the Company’s common stock. | ||||||||||||||
In connection with the adoption of the Shareholder Rights Plan, the Board of Directors of the Company declared a dividend distribution of one preferred stock purchase right (a “Right”) for each outstanding share of common stock to stockholders of record as of the close of business on November 15, 2008. In addition, one Right will automatically attach to each share of common stock issued between November 15, 2008 and the distribution date. The Rights currently are not exercisable and are attached to and trade with the outstanding shares of common stock. Under the Shareholder Rights Plan, the Rights become exercisable if a person or group becomes an “acquiring person” by acquiring 15% or more of the outstanding shares of common stock or if a person or group commences a tender offer that would result in that person or group owning 15% or more of the common stock. If a person or group becomes an “acquiring person,” each holder of a Right (other than the acquiring person) would be entitled to purchase, at the then-current exercise price, such number of shares of the Company’s preferred stock which are equivalent to shares of common stock having a value of twice the exercise price of the Right. If the Company is acquired in a merger or other business combination transaction after any such event, each holder of a Right would then be entitled to purchase, at the then-current exercise price, shares of the acquiring company’s common stock having a value of twice the exercise price of the Right. |
Defined_Contribution_Plan
Defined Contribution Plan | 12 Months Ended |
Dec. 31, 2013 | |
Compensation and Retirement Disclosure [Abstract] | ' |
Defined Contribution Plan | ' |
Defined Contribution Plan | |
The Insulet 401(k) Retirement Plan (the “401(k) Plan”) is a defined contribution plan in the form of a qualified 401(k) plan, in which substantially all employees are eligible to participate upon the first day of the month following 30 days of service. Eligible employees may elect to contribute, subject to certain IRS limits, up to 20% of their compensation. The Company has the option of making both matching contributions and discretionary profit-sharing contributions to the 401(k) Plan. Since 2011, the Company has offered a discretionary match of 50% for the first 6% of an employee’s salary that was contributed to the 401(k) Plan. The Company match vests over a four-year period (25% per year). The total amount contributed by the Company under the 401(k) Plan was $1.0 million, $1.0 million, and $0.7 million for the years ended December 31, 2013, 2012 and 2011, respectively. |
Income_Taxes
Income Taxes | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Income Tax Disclosure [Abstract] | ' | |||||||||||
Income Taxes | ' | |||||||||||
Income Taxes | ||||||||||||
The Company accounts for income taxes under ASC 740. 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 reverse. | ||||||||||||
Income tax benefit (expense) consists of the following (in thousands): | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Current | $ | (16 | ) | $ | (121 | ) | $ | (77 | ) | |||
Deferred | (84 | ) | (91 | ) | 11,289 | |||||||
Total income tax benefit (expense) | $ | (100 | ) | $ | (212 | ) | $ | 11,212 | ||||
For the year ended December 31, 2013, the current portion of income tax expense is primarily related to federal, state, and foreign taxes. For the years ended December 31, 2012 and 2011 the current portion of income tax expense primarily related to state and foreign taxes. For the years ended December 31, 2013 and 2012, the deferred portion of tax expense primarily related to the U.S. Federal and State amounts. For the year ended December 31, 2011, income tax benefit resulted from a change in the valuation allowance for preexisting deferred tax assets as a result of the Neighborhood Diabetes acquisition and current tax expense primarily related to state and local taxes. | ||||||||||||
The following table reconciles the federal statutory income rate to the Company's effective income tax rate: | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Tax at U.S. statutory rate | 34 | % | 34 | % | 34 | % | ||||||
State taxes, net of federal benefit | (4.21 | ) | (1.18 | ) | (1.88 | ) | ||||||
Tax credits | 4.98 | 0.5 | 2.07 | |||||||||
Non-deductible expenses | (5.49 | ) | (1.37 | ) | (1.96 | ) | ||||||
Change in valuation allowance | (29.32 | ) | (32.34 | ) | (11.65 | ) | ||||||
Other | (0.18 | ) | (0.01 | ) | (0.92 | ) | ||||||
Effective income tax rate | (0.22 | )% | (0.40 | )% | 19.66 | % | ||||||
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amount of assets and liabilities for financial reporting and the amounts used for income tax purposes as well as federal and state net operating losses and tax credit carryforwards. Significant components of the Company’s deferred tax assets (liabilities) consists of the following (in thousands): | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | |||||||||||
Deferred tax assets: | ||||||||||||
Net operating loss carryforwards | $ | 154,872 | $ | 151,818 | ||||||||
Start up expenditures | 1,672 | 2,020 | ||||||||||
Tax credits | 9,841 | 7,608 | ||||||||||
Bad debt | 2,679 | 2,602 | ||||||||||
Depreciation & amortization | 1,675 | 2,357 | ||||||||||
Other | 6,357 | 4,661 | ||||||||||
Total deferred tax assets | $ | 177,096 | $ | 171,066 | ||||||||
Deferred tax liabilities: | ||||||||||||
Prepaids | $ | (310 | ) | $ | (169 | ) | ||||||
Amortization of acquired intangibles | (6,734 | ) | (9,015 | ) | ||||||||
Amortization of debt discount | (11,214 | ) | (15,955 | ) | ||||||||
Goodwill | (223 | ) | (139 | ) | ||||||||
Other | (515 | ) | — | |||||||||
Total deferred tax liabilities | $ | (18,996 | ) | $ | (25,278 | ) | ||||||
Valuation allowance | $ | (158,323 | ) | $ | (145,927 | ) | ||||||
Net deferred tax liabilities | $ | (223 | ) | $ | (139 | ) | ||||||
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. After consideration of the available evidence, both positive and negative, the Company has determined that a $158.3 million valuation allowance at December 31, 2013 is necessary to reduce the deferred tax assets to the amount that will more likely than not be realized. The Company provided a valuation allowance for the full amount of its net deferred tax asset for the years ended December 31, 2013 and 2012 because it is not more likely than not that the future tax benefit will be realized. In the year ended December 31, 2013, the Company’s valuation allowance increased by $12.4 million to $158.3 million from the balance at December 31, 2012 of $145.9 million. The change in the valuation allowance is primarily attributable to the deferred tax liabilities related to amortization of debt discount, offset by an increase in net operating loss carryfowards. | ||||||||||||
At December 31, 2013, the Company had approximately $461.7 million, $217.5 million and $9.8 million of federal net operating loss carryforwards, state net operating loss carryforwards and research and development and other tax credits, respectively. If not utilized, these federal carryforwards will begin to expire in 2020 and will continue to expire through 2033, and the state carryforwards will continue to expire through 2033. At December 31, 2012, the Company had approximately $404.4 million, $282.8 million and $7.6 million of federal net operating loss carryforwards, state net operating loss carryforwards and research and development and other tax credits, respectively. The utilization of such net operating loss carryforwards and the realization of tax benefits in future years depends predominantly upon having taxable income. Under the provisions of the Internal Revenue Code, certain substantial changes in the Company's ownership may result in a limitation on the amount of net operating loss carryforwards which may be used in future years. It is probable that once a study is complete that there will be a yearly limitation placed on the amount of net operating loss available for use in future years. The Company has not completed a Research and Development Credit study accordingly, it is probable that a portion of the tax credit carryforward may not be available to offset future income. | ||||||||||||
The Company had no unrecognized tax benefits December 31, 2013 and $0.1 million of unrecognized tax benefits at December 31, 2012. Unrecognized tax benefits represent tax positions for which reserves have been established. Unrecognized state benefits and interest related to unrecognized tax benefits are reflected net of applicable tax benefits. | ||||||||||||
The Company currently intends to reinvest the total amount of its unremitted earnings in the local international jurisdiction. As such, the Company has not provided for U.S. Federal income taxes on the unremitted earnings of its international subsidiary. |
Quarterly_Data_Unaudited
Quarterly Data (Unaudited) | 12 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Quarterly Data (Unaudited) [Abstract] | ' | |||||||||||||||
Quarterly Financial Information | ' | |||||||||||||||
Quarterly Data (Unaudited) | ||||||||||||||||
2013 Quarters ended | ||||||||||||||||
December 31 | September 30 | June 30 | March 31 | |||||||||||||
(In thousands, except per share data) | ||||||||||||||||
Revenue | $ | 68,533 | $ | 61,103 | $ | 60,092 | $ | 57,356 | ||||||||
Gross profit | $ | 33,018 | $ | 27,395 | $ | 26,833 | $ | 25,155 | ||||||||
Net loss | $ | (2,500 | ) | $ | (21,290 | ) | $ | (10,519 | ) | $ | (10,665 | ) | ||||
Net loss per share | $ | (0.04 | ) | $ | (0.39 | ) | $ | (0.20 | ) | $ | (0.20 | ) | ||||
2012 Quarters ended | ||||||||||||||||
December 31 | September 30 | 30-Jun | March 31 | |||||||||||||
(In thousands, except per share data) | ||||||||||||||||
Revenue | $ | 57,828 | $ | 54,752 | $ | 51,035 | $ | 47,754 | ||||||||
Gross profit | $ | 25,319 | $ | 24,390 | $ | 22,331 | $ | 20,296 | ||||||||
Net loss | $ | (10,194 | ) | $ | (12,417 | ) | $ | (14,476 | ) | $ | (14,780 | ) | ||||
Net loss per share | $ | (0.21 | ) | $ | (0.26 | ) | $ | (0.30 | ) | $ | (0.31 | ) | ||||
Net loss in the fourth quarter of 2013 includes $1.4 million of other income related to the mark to market fair value of the call feature on the modified portion of the Company’s 3.75% Notes. The $0.3 million impact to income in the fourth quarter of 2012 was considered immaterial. Additionally, the impact to income of $0.1 million, $0.3 million and $0.2 million in the first quarter, second quarter and third quarter of 2013, respectively, is considered immaterial. |
Schedule_II_Valuation_And_Qual
Schedule II - Valuation And Qualifying Accounts | 12 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Valuation and Qualifying Accounts [Abstract] | ' | |||||||||||||||
Schedule II - Valuation And Qualifying Accounts | ' | |||||||||||||||
SCHEDULE II — VALUATION AND QUALIFYING ACCOUNTS | ||||||||||||||||
The following table sets forth activities in our accounts receivable reserve and deferred tax valuation allowance accounts: | ||||||||||||||||
Classifications | Balance | Additions | Deductions | Balance End | ||||||||||||
Beginning of | Charged to | of Period | ||||||||||||||
Period | Costs and | |||||||||||||||
Expenses | ||||||||||||||||
(In thousands) | ||||||||||||||||
Year Ended December 31, 2013 | ||||||||||||||||
Allowance for doubtful accounts | $ | 6,627 | $ | 4,741 | $ | 4,235 | $ | 7,133 | ||||||||
Deferred tax valuation allowance | $ | 145,927 | $ | 32,050 | $ | 19,654 | $ | 158,323 | ||||||||
Year Ended December 31, 2012 | ||||||||||||||||
Allowance for doubtful accounts | $ | 7,021 | $ | 3,409 | $ | 3,803 | $ | 6,627 | ||||||||
Deferred tax valuation allowance | $ | 129,223 | $ | 20,972 | $ | 4,268 | $ | 145,927 | ||||||||
Year Ended December 31, 2011 | ||||||||||||||||
Allowance for doubtful accounts | $ | 5,432 | $ | 3,165 | $ | 1,576 | $ | 7,021 | ||||||||
Deferred tax valuation allowance | $ | 138,028 | $ | 27,047 | $ | 35,852 | $ | 129,223 | ||||||||
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policies) | 12 Months Ended | |
Dec. 31, 2013 | ||
Text Block [Abstract] | ' | |
Use of Estimates in Preparation of Financial Statements | ' | |
Use of Estimates in Preparation of Financial Statements | ||
The preparation of financial statements in conformity with generally accepted accounting principles in the United States 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 consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All material intercompany balances and transactions have been eliminated in consolidation. | ||
Certain Risks and Uncertainties | ' | |
Certain Risks and Uncertainties | ||
The Company is subject to risks common to companies in the medical device industry, including, but not limited to, development by the Company or its competitors of new technological innovations, dependence on key personnel, reliance on third party manufacturers, protection of proprietary technology, and compliance with regulatory requirements. | ||
Fair Value Measurements | ' | |
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. A single estimate of fair value results from a complex series of judgments about future events and uncertainties and relies heavily on estimates and assumptions. When estimating fair value, depending on the nature and complexity of the assets or liability, the Company may use one or all of the following approaches: | ||
• | Market approach, which is based on market prices and other information from market transactions involving identical or comparable assets or liabilities. | |
• | Cost approach, which is based on the cost to acquire or construct comparable assets less an allowance for functional and/or economic obsolescence. | |
• | Income approach, which is based on the present value of the future stream of net cash flows. | |
FASB 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 December 31, 2013 and 2012 are cash equivalents, consisting of money market accounts and long-term debt, which are based on Level 1 inputs and the June 2014 call feature on the modified portion of the 3.75% Notes which is based on Level 3 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. | ||
Cash and Cash Equivalents | ' | |
Cash and Cash Equivalents | ||
For the purposes of the financial statement classification, the Company considers all highly liquid investment instruments with original maturities of 90 days or less, when purchased, to be cash equivalents. Cash equivalents consist of money market accounts and are carried at cost which approximates their fair value. Outstanding letters of credit, principally relating to security deposits for lease obligations, totaled $0.1 million at December 31, 2013 and 2012. In January 2014, the Company obtained an additional $1.2 million letter of credit in connection with its new office lease in Billerica, Massachusetts. | ||
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 potential 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 at December 31, 2013 and 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 net realizable value 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 lives 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 and the amortization is included with depreciation expense. Maintenance and repair costs are expensed as incurred. | ||
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 finite-lived assets if the carrying amount of a long-lived 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 useful life of the acquired customer relationship asset is 10 years. Intangible assets with determinable estimated lives are amortized over these lives. | ||
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 follows the provisions of FASB ASC 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. 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. | ||
The Company continues to operate in one segment, which is considered to be the sole reporting unit and therefore, goodwill was tested for impairment at the enterprise level. To test for impairment, the Company has elected to first assess the qualitative factors to determine whether it is more likely than not that the fair value of its sole reporting unit is less than its carrying amount. This qualitative analysis is used as a basis for determining whether it is necessary to perform the two-step goodwill impairment analysis. If the Company determines that it is more likely than not that its fair value is less than its carrying amount, then the two-step goodwill impairment test will be performed. The first step, 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. No goodwill impairment was recorded in the year ended December 31, 2013. | ||
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 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 products and new versions of existing products, the Company also considers the anticipated performance of the product over its warranty period in estimating warranty reserves. | ||
Impairment of Assets | ' | |
Impairment of Assets | ||
In connection with its efforts to pursue improved gross margins, leverage operational efficiencies and better pursue opportunities for low-cost supplier sourcing, the Company periodically performs an evaluation of its manufacturing processes and reviews the carrying value of its property and equipment to assess the recoverability of these assets whenever events indicate that impairment may have occurred. As part of this assessment, the Company reviews the future undiscounted operating cash flows expected to be generated by those assets. If impairment is indicated through this review, the carrying amount of the asset would be reduced to its estimated fair value. This review of manufacturing processes and equipment can result in an impairment of assets based on current net book value and potential future use of the assets. In the year ended December 31, 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. | ||
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 collectibility 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 its 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 collectibility 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 was 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 invoiced amounts based upon meeting certain deliverable milestones. Revenue on 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 $0.9 million and $5.4 million as of December 31, 2013 and 2012, respectively. The deferred revenue recorded was primarily comprised of product-related revenue and unrecognized amounts related to the Development Agreement. | ||
Shipping and Handling Costs | ' | |
Shipping and Handling Costs | ||
The Company does not typically charge its customers for shipping and handling costs associated with shipping its product to its customers. These shipping and handling costs are included in general and administrative expenses. | ||
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 December 31, 2013 and 2012, liabilities from one vendor represented approximately 36% and 19% of the combined balance of accounts payable, accrued expenses and other current liabilities, respectively. | ||
Research and Development Expenses | ' | |
Research and Development Expenses | ||
The Company’s research and development expenses consist of engineering, product development, quality assurance, clinical and regulatory expenses. These expenses are primarily related to employee compensation, including salary, benefits and stock-based compensation. The Company also incurs expenses related to consulting fees, materials and supplies, and clinical studies, including data management and associated travel expenses. Research and development costs are expensed as incurred. | ||
General and Administrative Expenses | ' | |
General and Administrative Expenses | ||
General and administrative expenses are primarily comprised of salaries and benefits associated with finance, legal and other administrative personnel, overhead and occupancy costs, outside legal costs, and other general and administrative costs. | ||
Sales and Marketing Expenses | ' | |
Sales and Marketing Expenses | ||
Sales and marketing expenses are primarily comprised of salaries and benefits associated with sales and marketing personnel, outside marketing expenses including commercial product samples, tradeshows and advertising expenses. | ||
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. As the Company sells a single product type, management operates the business as a single entity. | ||
Income Taxes | ' | |
Income Taxes | ||
The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. 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 effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. | ||
The Company follows the provisions of FASB ASC 740-10, Income Taxes (“ASC 740-10”) on 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, disclosure and transition. The Company had no unrecognized tax benefits as of December 31, 2013 and $0.1 million of unrecognized tax benefits as of December 31, 2012. The Company recognizes estimated interest and penalties for uncertain tax positions in income tax expense. In the years ended December 31, 2012 and 2011, interest and tax penalties were immaterial to the 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 tax 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 and restricted stock units, 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 and 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 vesting period 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 the 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. | ||
In the years ended December 31, 2013, 2012, and 2011, the Company recorded $12.7 million, $9.9 million, and $7.7 million of stock-based compensation expense, respectively. | ||
See Footnote 13 for a summary of the stock option activity under the Company’s stock-based employee compensation plan. | ||
Recent Accounting Pronouncements | ' | |
Recent Accounting Pronouncements | ||
In December 2011, the FASB issued ASU No. 2011-11, Disclosures about Offsetting Assets and Liabilities. ASU 2011-11 will require disclosure of information about offsetting and related arrangements to enable users of the Company’s financial statements to understand the effect of those arrangements on its financial position. The guidance is effective in fiscal years beginning after January 1, 2013. 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. | ||
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. |
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 12 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Fair Value Disclosures [Abstract] | ' | |||||||||||||||
Fair Value, Assets Measured on Recurring and Nonrecurring Basis | ' | |||||||||||||||
The following table provides a summary of financial assets that are measured at fair value on a recurring basis as of December 31, 2013, aggregated by the level in the fair value hierarchy within which those measurements fall (in thousands): | ||||||||||||||||
Fair Value Measurements | ||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | |||||||||||||
Assets | ||||||||||||||||
Cash Equivalents - Money Market Funds | $ | 128,308 | $ | 128,308 | $ | — | $ | — | ||||||||
Other Asset - Call feature on 3.75% Notes | $ | 1,351 | $ | — | $ | — | $ | 1,351 | ||||||||
The following table provides a summary of financial assets that are measured at fair value on a recurring basis as of December 31, 2012, aggregated by the level in the fair value hierarchy within those those measurements fall (in thousands): | ||||||||||||||||
Fair Value Measurements | ||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | |||||||||||||
Assets | ||||||||||||||||
Cash Equivalents - Money Market Funds | $ | 50,251 | $ | 50,251 | $ | — | $ | — | ||||||||
Other Asset - Call feature on 3.75% Notes | $ | — | $ | — | $ | — | $ | — | ||||||||
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques | ' | |||||||||||||||
The key assumptions used in the lattice model valuation for the call feature at December 31, 2013 were as follows: | ||||||||||||||||
Term to Maturity (years) | 2.46 | |||||||||||||||
Bond Inputs: | ||||||||||||||||
Bond Yield | 8.61% | |||||||||||||||
Coupon Rate | 3.75% | |||||||||||||||
Conversion Price | $26.20 | |||||||||||||||
Bond Call Strike Price | $100.00 | |||||||||||||||
Stock Inputs: | ||||||||||||||||
Stock Price | $37.10 | |||||||||||||||
Risk Free Rate | 0.56% | |||||||||||||||
Volatility | 38.00% | |||||||||||||||
Dividend Yield | —% | |||||||||||||||
Fair Value, Liabilities Measured on Recurring and Nonrecurring Basis | ' | |||||||||||||||
The carrying amounts and the estimated fair values of financial instruments as of December 31, 2013 and 2012, are as follows (in thousands): | ||||||||||||||||
31-Dec-13 | 31-Dec-12 | |||||||||||||||
Carrying | Estimated Fair | Carrying | Estimated Fair | |||||||||||||
Value | Value | Value | Value | |||||||||||||
Debt | $ | 113,651 | $ | 211,370 | $ | 118,159 | $ | 174,428 | ||||||||
Debt_Tables
Debt (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Debt Disclosure [Abstract] | ' | |||||||||||
Outstanding Convertible Debt and Related Deferred Financing Costs | ' | |||||||||||
At December 31, 2013 and 2012, the Company had outstanding convertible debt and related deferred financing costs on its balance sheet as follows (in thousands): | ||||||||||||
As of 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 | (30,099 | ) | (40,591 | ) | ||||||||
Total long-term debt | 113,651 | 118,159 | ||||||||||
Current portion of long-term debt | — | 14,429 | ||||||||||
Long-term debt | $ | 113,651 | $ | 103,730 | ||||||||
Deferred financing costs | $ | 1,414 | $ | 2,004 | ||||||||
Interest Expense | ' | |||||||||||
Interest expense related to the 5.375% Senior Notes (as defined below) and the 3.75% Senior Notes (as defined below) was included in interest expense on the consolidated statements of operations as follows (in thousands): | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Contractual coupon interest | $ | 5,704 | $ | 6,197 | $ | 5,383 | ||||||
Accretion of debt discount | 10,492 | 9,619 | 7,213 | |||||||||
Other interest payments | — | — | 1,991 | |||||||||
Loss on debt extinguishment | 325 | — | — | |||||||||
Amortization of debt issuance costs | 590 | 593 | 532 | |||||||||
Total interest expense | $ | 17,111 | $ | 16,409 | $ | 15,119 | ||||||
Capital_Lease_Obligations_Tabl
Capital Lease Obligations (Tables) | 12 Months Ended | ||||||
Dec. 31, 2013 | |||||||
Leases [Abstract] | ' | ||||||
Schedule of Capital Leased Assets | ' | ||||||
Assets held under capital leases consist of the following (in thousands): | |||||||
As of December 31, | |||||||
2013 | 2012 | ||||||
Manufacturing equipment | $ | 6,510 | $ | — | |||
Less: Accumulated depreciation | (582 | ) | — | ||||
Total | $ | 5,928 | $ | — | |||
Schedule of Future Minimum Lease Payments for Capital Leases | ' | ||||||
The aggregate future minimum lease payments related to these capital leases as of December 31, 2013, are as follows (in thousands): | |||||||
Year Ending | Minimum Lease Payments | ||||||
December 31, | |||||||
2014 | 3,815 | ||||||
2015 | 3,815 | ||||||
2016 | 2,409 | ||||||
Total future minimum lease payments | 10,039 | ||||||
Interest expense | (2,012 | ) | |||||
Total Capital lease obligation | 8,027 | ||||||
Net_Loss_Per_Share_Tables
Net Loss Per Share (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Text Block [Abstract] | ' | ||||||||
Potential Common Shares Excluded from Computation of Diluted Net Loss Per Share | ' | ||||||||
Potential dilutive common share equivalents consist of the following: | |||||||||
Year Ended December 31, | |||||||||
2013 | 2012 | 2011 | |||||||
5.375% Convertible Senior Notes | — | 702,701 | 702,701 | ||||||
3.75% Convertible Senior Notes | 5,487,642 | 5,487,642 | 5,487,642 | ||||||
Unvested restricted stock units | 1,011,893 | 825,068 | 603,882 | ||||||
Outstanding options | 1,828,613 | 2,502,190 | 2,814,591 | ||||||
Outstanding warrants | — | 62,752 | 62,752 | ||||||
Total dilutive common shares | 8,328,148 | 9,580,353 | 9,671,568 | ||||||
Accounts_Receivable_Tables
Accounts Receivable (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Text Block [Abstract] | ' | |||||||
Components of Accounts Receivable | ' | |||||||
The components of accounts receivable are as follows (in thousands): | ||||||||
As of December 31, | ||||||||
2013 | 2012 | |||||||
Trade receivables | $ | 40,200 | $ | 39,921 | ||||
Allowance for doubtful accounts | (7,133 | ) | (6,627 | ) | ||||
Total accounts receivable | $ | 33,067 | $ | 33,294 | ||||
Inventories_Tables
Inventories (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Text Block [Abstract] | ' | |||||||
Components of Inventories | ' | |||||||
Inventories consist of the following (in thousands): | ||||||||
As of December 31, | ||||||||
2013 | 2012 | |||||||
Raw materials | $ | 399 | $ | 1,487 | ||||
Work-in-process | 1,671 | 1,595 | ||||||
Finished goods | 7,394 | 11,785 | ||||||
Total inventories | $ | 9,464 | $ | 14,867 | ||||
Property_and_Equipment_Tables
Property and Equipment (Tables) | 12 Months Ended | |||||||||
Dec. 31, 2013 | ||||||||||
Property, Plant and Equipment [Abstract] | ' | |||||||||
Components of Property and Equipment | ' | |||||||||
Property and equipment consist of the following (in thousands): | ||||||||||
Estimated | As of | |||||||||
Useful Life | December 31, | |||||||||
(Years) | 2013 | 2012 | ||||||||
Machinery and equipment | 5-Feb | $ | 48,814 | $ | 28,879 | |||||
Lab equipment | 2 | 1,481 | 1,481 | |||||||
Computers | 3 | 3,796 | 3,558 | |||||||
Software | 3 | 4,813 | 4,670 | |||||||
Office furniture and fixtures | 5-Mar | 2,048 | 2,045 | |||||||
Leasehold improvement | * | 2,971 | 2,899 | |||||||
Construction in process | — | 2,895 | 9,817 | |||||||
Total property and equipment | $ | 66,818 | $ | 53,349 | ||||||
Less: Accumulated depreciation | (34,462 | ) | (27,927 | ) | ||||||
Total property and equipment | $ | 32,356 | $ | 25,422 | ||||||
_________________________ | ||||||||||
* Lesser of lease term or useful life of asset |
Other_Intangible_Assets_Tables
Other Intangible Assets (Tables) | 12 Months Ended | |||||||||||||||||||||||
Dec. 31, 2013 | ||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ' | |||||||||||||||||||||||
Components of Other Intangible Assets | ' | |||||||||||||||||||||||
Other intangible assets consist of the following (in thousands): | ||||||||||||||||||||||||
As of December 31, | ||||||||||||||||||||||||
2013 | 2012 | |||||||||||||||||||||||
Cost | Accumulated | NBV | Cost | Accumulated | NBV | |||||||||||||||||||
Amortization | Amortization | |||||||||||||||||||||||
Customer relationships | $ | 30,100 | $ | (14,378 | ) | $ | 15,722 | $ | 30,100 | $ | (9,641 | ) | $ | 20,459 | ||||||||||
Tradename | 2,800 | (482 | ) | 2,318 | 2,800 | (296 | ) | 2,504 | ||||||||||||||||
Total intangible assets | $ | 32,900 | $ | (14,860 | ) | $ | 18,040 | $ | 32,900 | $ | (9,937 | ) | $ | 22,963 | ||||||||||
Amortization Expense Expected for Next Five Years | ' | |||||||||||||||||||||||
Amortization expense expected for the next five years is as follows (in thousands): | ||||||||||||||||||||||||
Amortization Expense | ||||||||||||||||||||||||
Year Ending December 31, | Customer | Tradename | Total | |||||||||||||||||||||
Relationships | ||||||||||||||||||||||||
2014 | $ | 3,790 | $ | 187 | $ | 3,977 | ||||||||||||||||||
2015 | 3,064 | 187 | 3,251 | |||||||||||||||||||||
2016 | 2,478 | 187 | 2,665 | |||||||||||||||||||||
2017 | 2,003 | 187 | 2,190 | |||||||||||||||||||||
2018 | 1,619 | 187 | 1,806 | |||||||||||||||||||||
Thereafter | 2,768 | 1,383 | 4,151 | |||||||||||||||||||||
Total | 15,722 | 2,318 | 18,040 | |||||||||||||||||||||
Accrued_Expenses_and_Other_Cur1
Accrued Expenses and Other Current Liabilities (Tables) | 12 Months Ended | |||||||
Dec. 31, 2013 | ||||||||
Accrued Liabilities and Other Liabilities [Abstract] | ' | |||||||
Components of Accrued Liabilities and other current liabilities | ' | |||||||
Accrued expenses and other current liabilities consist of the following (in thousands): | ||||||||
As of | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
Employee compensation and related items | $ | 6,887 | $ | 6,789 | ||||
Professional and consulting services | 2,437 | 2,069 | ||||||
Sales and use tax | 3,928 | 3,965 | ||||||
Supplier charges | 1,850 | 1,752 | ||||||
Interest expense | 225 | 258 | ||||||
Warranty reserve | 1,173 | 863 | ||||||
Training | 717 | 455 | ||||||
Other | 2,261 | 2,900 | ||||||
Total accrued expenses and other current liabilities | $ | 19,478 | $ | 19,051 | ||||
Reconciliation of Changes in Company's Product Warranty Liability | ' | |||||||
A reconciliation of the changes in the Company’s product warranty liability is as follows (in thousands): | ||||||||
Year Ended | ||||||||
December 31, | ||||||||
2013 | 2012 | |||||||
Balance at the beginning of year | $ | 1,992 | $ | 1,960 | ||||
Warranty expense | 4,065 | 2,666 | ||||||
Warranty claims settled | (2,967 | ) | (2,634 | ) | ||||
Balance at the end of the year | $ | 3,090 | $ | 1,992 | ||||
Composition of balance: | ||||||||
Short-term | $ | 1,173 | $ | 863 | ||||
Long-term | 1,917 | 1,129 | ||||||
Total warranty balance | $ | 3,090 | $ | 1,992 | ||||
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 12 Months Ended | |||
Dec. 31, 2013 | ||||
Commitments and Contingencies Disclosure [Abstract] | ' | |||
Aggregate Future Minimum Lease Payments | ' | |||
The aggregate future minimum lease payments of these leases as of December 31, 2013, are as follows (in thousands): | ||||
Year Ending December 31, | Minimum | |||
Lease Payments | ||||
2014 | $ | 1,433 | ||
2015 | 1,974 | |||
2016 | 1,934 | |||
2017 | 2,012 | |||
2018 | 2,012 | |||
Thereafter | 8,150 | |||
Total | $ | 17,515 | ||
Equity_Tables
Equity (Tables) | 12 Months Ended | |||||||||||||
Dec. 31, 2013 | ||||||||||||||
Equity [Abstract] | ' | |||||||||||||
Stock Option Activity | ' | |||||||||||||
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 | 282,400 | 25.79 | ||||||||||||
Exercised | (872,073 | ) | 10.67 | $ | 17,820 | (1 | ) | |||||||
Canceled | (83,904 | ) | 19.94 | |||||||||||
Balance, December 31, 2013 | 1,828,613 | $ | 16.46 | $ | 37,742 | |||||||||
Vested, December 31, 2013 | 1,115,339 | $ | 13.42 | $ | 26,413 | (2 | ) | |||||||
Vested and expected to vest, December 31, 2013(3) | 1,562,587 | $ | 33,349 | (2 | ) | |||||||||
_________________________ | ||||||||||||||
-1 | The aggregate intrinsic value was calculated based on the positive difference between the estimated fair value of the Company’s common stock as of the date of exercise and the exercise price of the underlying options. The aggregate intrinsic value of options exercised in the years ended December 31, 2013, 2012 and 2011, was $17.8 million, $9.0 million and $8.8 million, respectively. | |||||||||||||
-2 | The aggregate intrinsic value was calculated based on the positive difference between the estimated fair value of the Company’s common stock as of December 31, 2013, and the exercise price of the underlying options. | |||||||||||||
-3 | Represents the number of vested options as of December 31, 2013, plus the number of unvested options expected to vest as of December 31, 2013, based on the unvested options outstanding at December 31, 2013, adjusted for the estimated forfeiture rate of 16%. | |||||||||||||
Employee Stock Options Calculated using the Black-Scholes Option Pricing Model | ' | |||||||||||||
The estimated grant date fair values of the employee stock options were calculated using the Black-Scholes option pricing model, based on the following assumptions: | ||||||||||||||
Year Ended December 31, | ||||||||||||||
2013 | 2012 | 2011 | ||||||||||||
Risk-free interest rate | 0.93% - 1.91% | 0.80% - 1.16% | 1.16% - 2.61% | |||||||||||
Expected term (in years) | 6.25 | 6.25 | 6.25 | |||||||||||
Dividend yield | — | — | — | |||||||||||
Expected volatility | 63% - 66% | 67% - 71% | 72% - 76% | |||||||||||
Summary of Restricted Stock Units | ' | |||||||||||||
The following table summarizes the status of the Company’s restricted stock units: | ||||||||||||||
Number of | Weighted | |||||||||||||
Shares (#) | Average | |||||||||||||
Fair Value ($) | ||||||||||||||
Balance, December 31, 2012 | 825,068 | $ | 18.4 | |||||||||||
Granted | 588,875 | 24.49 | ||||||||||||
Vested | (338,325 | ) | 17.43 | |||||||||||
Forfeited | (63,725 | ) | 20.94 | |||||||||||
Balance, December 31, 2013 | 1,011,893 | $ | 22.11 | |||||||||||
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | ||||||||||||
Income Tax Disclosure [Abstract] | ' | |||||||||||
Income Tax benefit (expense) | ' | |||||||||||
Income tax benefit (expense) consists of the following (in thousands): | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Current | $ | (16 | ) | $ | (121 | ) | $ | (77 | ) | |||
Deferred | (84 | ) | (91 | ) | 11,289 | |||||||
Total income tax benefit (expense) | $ | (100 | ) | $ | (212 | ) | $ | 11,212 | ||||
Reconciliation of Income Tax Expense (Benefit) at the Statutory Federal Income Tax Rate | ' | |||||||||||
The following table reconciles the federal statutory income rate to the Company's effective income tax rate: | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | 2011 | ||||||||||
Tax at U.S. statutory rate | 34 | % | 34 | % | 34 | % | ||||||
State taxes, net of federal benefit | (4.21 | ) | (1.18 | ) | (1.88 | ) | ||||||
Tax credits | 4.98 | 0.5 | 2.07 | |||||||||
Non-deductible expenses | (5.49 | ) | (1.37 | ) | (1.96 | ) | ||||||
Change in valuation allowance | (29.32 | ) | (32.34 | ) | (11.65 | ) | ||||||
Other | (0.18 | ) | (0.01 | ) | (0.92 | ) | ||||||
Effective income tax rate | (0.22 | )% | (0.40 | )% | 19.66 | % | ||||||
Components of the Company's Deferred Tax Assets (Liabilities) | ' | |||||||||||
Significant components of the Company’s deferred tax assets (liabilities) consists of the following (in thousands): | ||||||||||||
Year Ended December 31, | ||||||||||||
2013 | 2012 | |||||||||||
Deferred tax assets: | ||||||||||||
Net operating loss carryforwards | $ | 154,872 | $ | 151,818 | ||||||||
Start up expenditures | 1,672 | 2,020 | ||||||||||
Tax credits | 9,841 | 7,608 | ||||||||||
Bad debt | 2,679 | 2,602 | ||||||||||
Depreciation & amortization | 1,675 | 2,357 | ||||||||||
Other | 6,357 | 4,661 | ||||||||||
Total deferred tax assets | $ | 177,096 | $ | 171,066 | ||||||||
Deferred tax liabilities: | ||||||||||||
Prepaids | $ | (310 | ) | $ | (169 | ) | ||||||
Amortization of acquired intangibles | (6,734 | ) | (9,015 | ) | ||||||||
Amortization of debt discount | (11,214 | ) | (15,955 | ) | ||||||||
Goodwill | (223 | ) | (139 | ) | ||||||||
Other | (515 | ) | — | |||||||||
Total deferred tax liabilities | $ | (18,996 | ) | $ | (25,278 | ) | ||||||
Valuation allowance | $ | (158,323 | ) | $ | (145,927 | ) | ||||||
Net deferred tax liabilities | $ | (223 | ) | $ | (139 | ) |
Quarterly_Data_Unaudited_Table
Quarterly Data (Unaudited) (Tables) | 12 Months Ended | |||||||||||||||
Dec. 31, 2013 | ||||||||||||||||
Text Block [Abstract] | ' | |||||||||||||||
Selected Quarterly Data | ' | |||||||||||||||
2013 Quarters ended | ||||||||||||||||
December 31 | September 30 | June 30 | March 31 | |||||||||||||
(In thousands, except per share data) | ||||||||||||||||
Revenue | $ | 68,533 | $ | 61,103 | $ | 60,092 | $ | 57,356 | ||||||||
Gross profit | $ | 33,018 | $ | 27,395 | $ | 26,833 | $ | 25,155 | ||||||||
Net loss | $ | (2,500 | ) | $ | (21,290 | ) | $ | (10,519 | ) | $ | (10,665 | ) | ||||
Net loss per share | $ | (0.04 | ) | $ | (0.39 | ) | $ | (0.20 | ) | $ | (0.20 | ) | ||||
2012 Quarters ended | ||||||||||||||||
December 31 | September 30 | 30-Jun | March 31 | |||||||||||||
(In thousands, except per share data) | ||||||||||||||||
Revenue | $ | 57,828 | $ | 54,752 | $ | 51,035 | $ | 47,754 | ||||||||
Gross profit | $ | 25,319 | $ | 24,390 | $ | 22,331 | $ | 20,296 | ||||||||
Net loss | $ | (10,194 | ) | $ | (12,417 | ) | $ | (14,476 | ) | $ | (14,780 | ) | ||||
Net loss per share | $ | (0.21 | ) | $ | (0.26 | ) | $ | (0.30 | ) | $ | (0.31 | ) |
Summary_of_Significant_Account2
Summary of Significant Accounting Policies - Additional Information (Detail) (USD $) | 12 Months Ended | |||||||||||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2011 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Jan. 31, 2014 | |
Customer | Customer | Tradename | Customer relationships | Neighborhood Diabetes | Neighborhood Diabetes | Minimum [Member] | Maximum | Maximum | Machinery and equipment | Subsequent Event [Member] | ||
Location | Tradename | Customer relationships | ||||||||||
Significant Accounting Policies [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of Operating Segments | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Letter of credit | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $1,200,000 |
Return Period | '45 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Product Warranty Term | '4 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Deferred revenue | 900,000 | 5,445,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Impairment and other charges | 2,511,000 | 0 | 0 | ' | ' | ' | ' | ' | ' | ' | 2,500,000 | ' |
Goodwill, Impairment Loss | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maturity period for all highly liquid investment instruments | ' | ' | ' | ' | ' | ' | ' | ' | '90 days | '90 days | ' | ' |
Restricted cash | 100,000 | 100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Estimated Useful Life | ' | ' | ' | '15 years | '10 years | '15 years | '10 years | ' | ' | ' | ' | ' |
Number of accredited financial institutions which the Company maintains the majority of its cash | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of Single Source Suppliers | 1 | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Combined balance of accounts payable | 36.00% | 19.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unrecognized tax benefits | 0 | 100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stock-based compensation expense | $12,700,000 | $9,900,000 | $7,700,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of Open Tax Years | ' | ' | ' | ' | ' | ' | ' | '3 years | '4 years | ' | ' | ' |
Fair_Value_Measurements_Schedu
Fair Value Measurements - Schedule of Assets Measured on a Recurring and Nonrecurring Basis (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Cash Equivalents - Money Market Funds | $128,308 | $50,251 |
Other Asset - Call feature on 3.75% Notes | 1,351 | 0 |
Level 1 | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Cash Equivalents - Money Market Funds | 128,308 | 50,251 |
Other Asset - Call feature on 3.75% Notes | 0 | 0 |
Level 2 | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Cash Equivalents - Money Market Funds | 0 | 0 |
Other Asset - Call feature on 3.75% Notes | 0 | 0 |
Level 3 | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Cash Equivalents - Money Market Funds | 0 | 0 |
Other Asset - Call feature on 3.75% Notes | $1,351 | $0 |
Fair_Value_Measurements_Schedu1
Fair Value Measurements - Schedule of Liabilities Measure on Recurring and Nonrecurring Basis (Details) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Carrying Value | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Debt | $113,651 | $118,159 |
Estimated Fair Value | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Debt | $211,370 | $174,428 |
Fair_Value_Measurements_Fair_V
Fair Value Measurements - Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques (Details) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Fair Value Disclosures [Abstract] | ' | ' |
Term to Maturity (years) | '2 years 5 months 15 days | ' |
Bond Yield | 8.61% | ' |
Coupon Rate | 3.75% | ' |
Conversion Price | $26.20 | ' |
Bond Call Strike Price | $100 | ' |
Stock Price | $37.10 | $21.22 |
Risk Free Rate | 0.56% | ' |
Volatility | 38.00% | ' |
Dividend Yield | 0.00% | ' |
Fair_Value_Measurements_Additi
Fair Value Measurements - Additional Information (Details) (USD $) | 12 Months Ended | |||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Jun. 30, 2011 | Jun. 30, 2011 |
Investor | 3.75% Convertible Notes | |||
Investor | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ' | ' |
Principal Amount Of Modified Debt Held | ' | ' | $73 | $59.50 |
Stock Price Change, Percent | 75.00% | ' | ' | ' |
Debt discount | $52.40 | $52.40 | ' | ' |
Debt_Outstanding_Convertible_D
Debt - Outstanding Convertible Debt and Related Deferred Financing Costs (Detail) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Jun. 30, 2008 | Dec. 31, 2013 | Dec. 31, 2012 | Jun. 30, 2011 |
In Thousands, unless otherwise specified | 5.375% Convertible Notes | 5.375% Convertible Notes | 5.375% Convertible Notes | 3.75% Convertible Notes | 3.75% Convertible Notes | 3.75% Convertible Notes | ||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Principal amount of Senior Notes | ' | ' | $0 | $15,000 | $85,000 | $143,750 | $143,750 | $143,800 |
Unamortized discount | -30,099 | -40,591 | ' | ' | -26,900 | ' | ' | ' |
Total long-term debt | 113,651 | 118,159 | ' | ' | ' | ' | ' | ' |
Current portion of long-term debt | 0 | 14,429 | ' | ' | ' | ' | ' | ' |
Long-term debt | 113,651 | 103,730 | ' | ' | ' | 113,700 | ' | ' |
Deferred financing costs | $1,414 | $2,004 | ' | ' | ' | ' | ' | ' |
Debt_Interest_Expense_Detail
Debt - Interest Expense (Detail) (5.375% Convertible notes and 3.75% Convertible notes, USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
5.375% Convertible notes and 3.75% Convertible notes | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' |
Contractual coupon interest | $5,704 | $6,197 | $5,383 |
Accretion of debt discount | 10,492 | 9,619 | 7,213 |
Other interest payments | 0 | 0 | 1,991 |
Loss on debt extinguishment | 325 | 0 | 0 |
Amortization of debt issuance costs | 590 | 593 | 532 |
Total interest expense | $17,111 | $16,409 | $15,119 |
Debt_Additional_Information_De
Debt - Additional Information (Detail) (USD $) | 1 Months Ended | 12 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | 1 Months Ended | 1 Months Ended | 12 Months Ended | 1 Months Ended | 1 Months Ended | 12 Months Ended | |||||||||||||||||
Jun. 30, 2013 | 31-May-13 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Jun. 30, 2011 | Dec. 31, 2013 | Jun. 30, 2008 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Jun. 30, 2011 | Jun. 30, 2008 | Jun. 30, 2008 | Jun. 30, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Jun. 30, 2011 | Jun. 30, 2011 | Jun. 30, 2011 | Jun. 30, 2011 | Jun. 30, 2011 | Jun. 30, 2011 | Jun. 30, 2011 | Jun. 30, 2011 | Jun. 30, 2011 | Dec. 31, 2013 | |
Investor | Scenario, Forecast | 5.375% Convertible Notes | 5.375% Convertible Notes | 5.375% Convertible Notes | 5.375% Convertible Notes | 5.375% Convertible Notes | 5.375% Convertible Notes | 5.375% Convertible Notes | 3.75% Convertible Notes | 3.75% Convertible Notes | 3.75% Convertible Notes | 3.75% Convertible Notes | 3.75% Convertible Notes | 3.75% Convertible Notes | 3.75% Convertible Notes | 3.75% Convertible Notes | 3.75% Convertible Notes | 3.75% Convertible Notes | 3.75% Convertible Notes | 3.75% Convertible Notes | 3.75% Convertible Notes | 3.75% Convertible Notes | ||||||
Investor | Semi Annual Payment, First Payment | Semi Annual Payment, Second Payment | Minimum [Member] | Maximum | Investor | Debt discount related to premium payment in connection with the purchase | Debt discount related to the increase in the value of the conversion feature. | Modified Debt | New Debt | Semi Annual Payment, First Payment | Semi Annual Payment, Second Payment | Scenario, Forecast | ||||||||||||||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Expected Cash Interest Payments, 2014 | ' | ' | ' | ' | ' | ' | $5,400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Expected Cash Interest Payments, 2015 | ' | ' | ' | ' | ' | ' | 5,400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Expected Cash Interest Payments, 2016 | ' | ' | ' | ' | ' | ' | 2,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Expected principal payments | ' | ' | 2,000,000 | 0 | 88,195,000 | ' | ' | ' | ' | ' | ' | 85,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 143,800,000 |
Principal amount of Notes | ' | ' | ' | ' | ' | ' | ' | 85,000,000 | 0 | 15,000,000 | ' | 70,000,000 | ' | ' | 143,800,000 | 143,750,000 | 143,750,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt, maturity date | ' | ' | ' | ' | ' | ' | ' | 15-Jun-13 | ' | ' | ' | ' | ' | ' | 15-Jun-16 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt, interest rate | ' | ' | ' | ' | ' | ' | ' | 5.38% | ' | ' | ' | ' | ' | ' | 3.75% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Frequency of interest payment | ' | ' | ' | ' | ' | ' | ' | 'semi-annually | ' | ' | ' | ' | ' | ' | 'semi-annually | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest payment date | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '--12-15 | '--06-15 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '--12-15 | '--06-15 | ' |
Debt conversion rate | ' | ' | ' | ' | ' | ' | ' | 46.8467 | ' | ' | ' | ' | ' | ' | 38.1749 | ' | ' | ' | ' | 50.5816 | ' | ' | ' | ' | ' | ' | ' | ' |
Principal amount per note used in conversion rate | ' | ' | ' | ' | ' | ' | ' | 1,000 | ' | ' | ' | ' | ' | ' | 1,000 | ' | ' | ' | ' | 1,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Conversion price, per share | ' | ' | ' | ' | ' | ' | ' | $21.35 | ' | ' | ' | ' | ' | ' | $26.20 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt instrument convertible premium | ' | ' | ' | ' | ' | ' | ' | 34.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of the principal amount of the notes to be repurchased, if a fundamental change occurs | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt discount | ' | ' | 30,099,000 | 40,591,000 | ' | ' | ' | 26,900,000 | ' | ' | ' | 10,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 15,100,000 | 200,000 | 25,800,000 | 26,600,000 | ' | ' | ' |
Debt Instrument, Interest Rate, Effective Percentage | ' | ' | ' | ' | ' | ' | ' | 14.50% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 16.50% | 12.40% | ' | ' | ' |
Debt discount amortization period | ' | ' | ' | ' | ' | ' | ' | '5 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '5 years | '5 years | ' | ' | ' |
Deferred financing costs | ' | ' | ' | ' | ' | ' | ' | 3,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,800,000 | ' | ' | ' |
Finance costs reclassified against equity | ' | ' | ' | ' | ' | ' | ' | 1,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 900,000 | ' | ' | ' |
Deferred financing costs, amortization period | ' | ' | ' | ' | ' | ' | ' | '5 years | ' | ' | ' | ' | ' | ' | '5 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Repurchase premium | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 21.50% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Principal Amount Of Modified Debt Held | ' | ' | ' | ' | ' | 73,000,000 | ' | ' | ' | ' | ' | 13,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | 59,500,000 | ' | ' | ' | ' | ' | ' | ' |
Other Asset - Call feature on 3.75% Notes | ' | ' | 1,351,000 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock issued in exchange for 5.375% Convertible Senior Notes | ' | 13,000,000 | 13,000,000 | 0 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Conversion, Converted Instrument, Shares Issued | 26,523 | 620,122 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash paid for interest | ' | 300,000 | 5,704,000 | 6,197,000 | 5,173,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Loss on debt extinguishment | ' | ' | 300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Repayment of remaining prinicpal amount including interest | 2,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest expense related to Notes | ' | ' | ' | ' | ' | ' | ' | ' | 300,000 | 800,000 | 2,700,000 | ' | ' | ' | ' | 5,400,000 | 5,400,000 | 2,700,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
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 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Short-term portion of long-term debt | ' | ' | 0 | 14,429,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Remaining term of debt | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '2 years 6 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Transaction fees | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,000,000 | ' | ' | ' | ' |
Principal debt amount issued to new investors | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 84,300,000 | ' | ' | ' |
Long-term debt | ' | ' | $113,651,000 | $103,730,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $113,700,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Capital_Lease_Obligations_Addi
Capital Lease Obligations - Additional Information (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Capital Leased Assets [Line Items] | ' | ' | ' |
Repayment Period for Capital Lease Obligations | '36 months | ' | ' |
Capital Leases of Lessee, Contingent Rentals, Effective Interest Rate | 17.00% | ' | ' |
Impairment and other charges | $2,511,000 | $0 | $0 |
Machinery and equipment | ' | ' | ' |
Capital Leased Assets [Line Items] | ' | ' | ' |
Capital Lease Assets prior to write down | 9,000,000 | ' | ' |
Manufacturing equipment | 6,510,000 | 0 | ' |
Estimated useful life | '5 years | ' | ' |
Impairment and other charges | 2,500,000 | ' | ' |
Capital Leases, Income Statement, Amortization Expense | 600,000 | 0 | 0 |
Capital Leases, Income Statement, Interest Expense | $400,000 | $0 | $0 |
Capital_Lease_Obligations_Sche
Capital Lease Obligations - Schedule of Capital Leased Assets (Details) (Machinery and equipment, USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Machinery and equipment | ' | ' |
Capital Leased Assets [Line Items] | ' | ' |
Manufacturing equipment | $6,510 | $0 |
Less: Accumulated depreciation | -582 | 0 |
Total | $5,928 | $0 |
Capital_Lease_Obligations_Sche1
Capital Lease Obligations - Schedule of Future Minimum Lease Payments for Capital Leases (Details) (USD $) | Dec. 31, 2013 |
In Thousands, unless otherwise specified | |
Leases [Abstract] | ' |
2014 | $3,815 |
2015 | 3,815 |
2016 | 2,409 |
Total future minimum lease payments | 10,039 |
Capital Leases, Future Minimum Payments, Interest Included in Payments | -2,012 |
Capital Leases, Future Minimum Payments, Present Value of Net Minimum Payments | $8,027 |
Net_Loss_Per_Share_Potential_C
Net Loss Per Share - Potential Common Shares Excluded from Computation of Diluted Net Loss Per Share (Detail) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' |
Antidilutive securities excluded from computation of earnings per share, amount | 8,328,148 | 9,580,353 | 9,671,568 |
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 | 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 |
Restricted Stock Units | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' |
Antidilutive securities excluded from computation of earnings per share, amount | 1,011,893 | 825,068 | 603,882 |
Outstanding options | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' |
Antidilutive securities excluded from computation of earnings per share, amount | 1,828,613 | 2,502,190 | 2,814,591 |
Warrant | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' |
Antidilutive securities excluded from computation of earnings per share, amount | 0 | 62,752 | 62,752 |
Accounts_Receivable_Additional
Accounts Receivable - Additional Information (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Customer | Customer | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ' | ' | ' |
Number of customers that accounted for more than 10% of gross accounts receivable | 2 | 2 | ' |
Provision for bad debts | $4,741 | $3,409 | $3,165 |
Customer 1 | ' | ' | ' |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ' | ' | ' |
Percentage of gross accounts receivable for major customer | 12.00% | 18.00% | ' |
Customer 2 | ' | ' | ' |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ' | ' | ' |
Percentage of gross accounts receivable for major customer | 10.00% | 11.00% | ' |
Accounts_Receivable_Components
Accounts Receivable - Components of Accounts Receivable (Detail) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Disclosure Components Of Accounts Receivable [Abstract] | ' | ' |
Trade receivables | $40,200 | $39,921 |
Allowance for doubtful accounts | -7,133 | -6,627 |
Total accounts receivable | $33,067 | $33,294 |
Inventories_Components_of_Inve
Inventories - Components of Inventories (Detail) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Disclosure Components Of Inventories [Abstract] | ' | ' |
Raw materials | $399 | $1,487 |
Work-in-process | 1,671 | 1,595 |
Finished goods | 7,394 | 11,785 |
Total inventories | $9,464 | $14,867 |
Property_and_Equipment_Compone
Property and Equipment - Component Property and Equipment (Detail) (USD $) | 12 Months Ended | |||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | ||
Property, Plant and Equipment [Line Items] | ' | ' | ||
Property, plant and equipment, gross | $66,818 | $53,349 | ||
Less: Accumulated depreciation | -34,462 | -27,927 | ||
Total property and equipment | 32,356 | 25,422 | ||
Machinery and equipment | ' | ' | ||
Property, Plant and Equipment [Line Items] | ' | ' | ||
Estimated useful life | '5 years | ' | ||
Property, plant and equipment, gross | 48,814 | 28,879 | ||
Machinery and equipment | Minimum [Member] | ' | ' | ||
Property, Plant and Equipment [Line Items] | ' | ' | ||
Estimated useful life | '2 years | ' | ||
Machinery and equipment | Maximum | ' | ' | ||
Property, Plant and Equipment [Line Items] | ' | ' | ||
Estimated useful life | '5 years | ' | ||
Lab equipment | ' | ' | ||
Property, Plant and Equipment [Line Items] | ' | ' | ||
Estimated useful life | '2 years | ' | ||
Property, plant and equipment, gross | 1,481 | 1,481 | ||
Computers | ' | ' | ||
Property, Plant and Equipment [Line Items] | ' | ' | ||
Estimated useful life | '3 years | ' | ||
Property, plant and equipment, gross | 3,796 | 3,558 | ||
Software | ' | ' | ||
Property, Plant and Equipment [Line Items] | ' | ' | ||
Estimated useful life | '3 years | ' | ||
Property, plant and equipment, gross | 4,813 | 4,670 | ||
Office furniture and fixtures | ' | ' | ||
Property, Plant and Equipment [Line Items] | ' | ' | ||
Property, plant and equipment, gross | 2,048 | 2,045 | ||
Office furniture and fixtures | Minimum [Member] | ' | ' | ||
Property, Plant and Equipment [Line Items] | ' | ' | ||
Estimated useful life | '3 years | ' | ||
Office furniture and fixtures | Maximum | ' | ' | ||
Property, Plant and Equipment [Line Items] | ' | ' | ||
Estimated useful life | '5 years | ' | ||
Leasehold improvement | ' | ' | ||
Property, Plant and Equipment [Line Items] | ' | ' | ||
Property, plant and equipment, gross | 2,971 | [1] | 2,899 | [1] |
Construction in process | ' | ' | ||
Property, Plant and Equipment [Line Items] | ' | ' | ||
Property, plant and equipment, gross | $2,895 | $9,817 | ||
[1] | Lesser of lease term or useful life of asset |
Property_and_Equipment_Additio
Property and Equipment - Additional Information (Detail) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Depreciation | $6,900,000 | $5,000,000 | $4,600,000 |
Capitalized interest | 300,000 | 600,000 | 400,000 |
Machinery and equipment | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' |
Manufacturing equipment | $6,510,000 | $0 | ' |
Other_Intangible_Assets_Compon
Other Intangible Assets - Components of Other Intangible Assets (Detail) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ' | ' |
Other intangible assets cost | $32,900 | $32,900 |
Less: Accumulated amortization | -14,860 | -9,937 |
Total | 18,040 | 22,963 |
Customer relationships | ' | ' |
Acquired Finite-Lived Intangible Assets [Line Items] | ' | ' |
Other intangible assets cost | 30,100 | 30,100 |
Less: Accumulated amortization | -14,378 | -9,641 |
Total | 15,722 | 20,459 |
Tradename | ' | ' |
Acquired Finite-Lived Intangible Assets [Line Items] | ' | ' |
Other intangible assets cost | 2,800 | 2,800 |
Less: Accumulated amortization | -482 | -296 |
Total | $2,318 | $2,504 |
Other_Intangible_Assets_Amorti
Other Intangible Assets - Amortization Expense Expected for Next Five Years (Detail) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Expected Amortization Expense [Line Items] | ' | ' |
2014 | $3,977 | ' |
2015 | 3,251 | ' |
2016 | 2,665 | ' |
2017 | 2,190 | ' |
2018 | 1,806 | ' |
Thereafter | 4,151 | ' |
Total | 18,040 | 22,963 |
Customer relationships | ' | ' |
Expected Amortization Expense [Line Items] | ' | ' |
2014 | 3,790 | ' |
2015 | 3,064 | ' |
2016 | 2,478 | ' |
2017 | 2,003 | ' |
2018 | 1,619 | ' |
Thereafter | 2,768 | ' |
Total | 15,722 | 20,459 |
Tradename | ' | ' |
Expected Amortization Expense [Line Items] | ' | ' |
2014 | 187 | ' |
2015 | 187 | ' |
2016 | 187 | ' |
2017 | 187 | ' |
2018 | 187 | ' |
Thereafter | 1,383 | ' |
Total | $2,318 | $2,504 |
Other_Intangible_Assets_Additi
Other Intangible Assets - Additional Information (Detail) (USD $) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Acquired Finite-Lived Intangible Assets [Line Items] | ' | ' | ' |
Other intangible assets cost | ' | ' | $32,900,000 |
Accumulated amortization | 14,860,000 | 9,937,000 | ' |
Amortization of other intangible assets | 4,900,000 | 6,000,000 | 3,900,000 |
Intangible asset,weighted average amortization period | '8 years | ' | ' |
Customer relationships | ' | ' | ' |
Acquired Finite-Lived Intangible Assets [Line Items] | ' | ' | ' |
Estimated Useful Life | ' | ' | '10 years |
Accumulated amortization | 14,378,000 | 9,641,000 | ' |
Tradename | ' | ' | ' |
Acquired Finite-Lived Intangible Assets [Line Items] | ' | ' | ' |
Estimated Useful Life | ' | ' | '15 years |
Accumulated amortization | $482,000 | $296,000 | ' |
Accrued_Expenses_and_Other_Cur2
Accrued Expenses and Other Current Liabilities - Component of Accrued Liabilities (Detail) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Disclosure Component Of Accrued Liabilities and Other Current Liabilities [Abstract] | ' | ' |
Employee compensation and related items | $6,887 | $6,789 |
Professional and consulting services | 2,437 | 2,069 |
Sales and use tax | 3,928 | 3,965 |
Supplier charges | 1,850 | 1,752 |
Interest expense | 225 | 258 |
Warranty reserve | 1,173 | 863 |
Training | 717 | 455 |
Other | 2,261 | 2,900 |
Total accrued expenses and other current liabilities | $19,478 | $19,051 |
Accrued_Expenses_and_Other_Cur3
Accrued Expenses and Other Current Liabilities - Additional Information (Detail) | 12 Months Ended |
Dec. 31, 2013 | |
Disclosure Accrued Expenses Additional Information [Abstract] | ' |
Product Warranty Term | '4 years |
Accrued_Expenses_and_Other_Cur4
Accrued Expenses and Other Current Liabilities - Reconciliation of Changes in Product Warranty Liability (Detail) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Disclosure Reconciliation Of Changes In Product Warranty Liability [Abstract] | ' | ' |
Balance at the beginning of year | $1,992 | $1,960 |
Warranty expense | 4,065 | 2,666 |
Warranty claims settled | -2,967 | -2,634 |
Balance at the end of the year | 3,090 | 1,992 |
Composition of balance: | ' | ' |
Short-term | 1,173 | 863 |
Long-term | 1,917 | 1,129 |
Total warranty balance | $3,090 | $1,992 |
Commitments_and_Contingencies_1
Commitments and Contingencies - Additional Information (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Operating Leased Assets [Line Items] | ' | ' | ' |
Rent expense | $1.60 | $1.70 | $1.30 |
Bedford, Massachusetts | ' | ' | ' |
Operating Leased Assets [Line Items] | ' | ' | ' |
Lease Expiration Month And Year | '2014-09 | ' | ' |
Lease facility area | 26,500 | ' | ' |
Billerica, Massachusetts | ' | ' | ' |
Operating Leased Assets [Line Items] | ' | ' | ' |
Lease Expiration Month And Year | '2014-09 | ' | ' |
Lease facility area | 90,000 | ' | ' |
Woburn, Massachusetts | ' | ' | ' |
Operating Leased Assets [Line Items] | ' | ' | ' |
Lease Expiration Month And Year | '2014-12 | ' | ' |
Singapore | ' | ' | ' |
Operating Leased Assets [Line Items] | ' | ' | ' |
Lease Expiration Month And Year | '2015-07 | ' | ' |
Florida Property | ' | ' | ' |
Operating Leased Assets [Line Items] | ' | ' | ' |
Lease Expiration Month And Year | '2014-12 | ' | ' |
New York State | ' | ' | ' |
Operating Leased Assets [Line Items] | ' | ' | ' |
Lease Expiration Month And Year | '2015-04 | ' | ' |
General and Administrative Expense | ' | ' | ' |
Operating Leased Assets [Line Items] | ' | ' | ' |
Litigation settlement, expense | $10 | ' | ' |
Commitments_and_Contingencies_2
Commitments and Contingencies - Aggregate Future Minimum Lease Payments (Detail) (USD $) | Dec. 31, 2013 |
In Thousands, unless otherwise specified | |
Minimum Lease Payments | ' |
2014 | $1,433 |
2015 | 1,974 |
2016 | 1,934 |
2017 | 2,012 |
2018 | 2,012 |
Thereafter | 8,150 |
Total | $17,515 |
Equity_Additional_Information_
Equity - Additional Information (Detail) (USD $) | 1 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | 12 Months Ended | 12 Months Ended | 1 Months Ended | 1 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | 1 Months Ended | ||||||||||||||||||||||||
Jun. 30, 2013 | 31-May-13 | Jan. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Jun. 30, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | 31-May-07 | Dec. 31, 2013 | Nov. 15, 2008 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2013 | 31-May-12 | 31-May-07 | Jan. 31, 2012 | Dec. 31, 2013 | 31-May-13 | Jan. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Jan. 31, 2013 | Dec. 31, 2013 | Nov. 30, 2013 | |
Neighborhood Diabetes | Stock Option Plan 2000 | Employee Stock Purchase Plan, 2007 Plan | Employee Stock Purchase Plan, 2007 Plan | Employee Stock Purchase Plan, 2007 Plan | Employee Stock Purchase Plan, 2007 Plan | Employee Stock Purchase Plan, 2007 Plan | Shareholder Rights Plan | Stock Options and Restricted Stock Units | Employee Stock Option | Employee Stock Option | Employee Stock Option | Restricted Stock Units | Restricted Stock Units | Restricted Stock Units | Restricted Stock Units | Restricted Stock Units | Performance Shares [Member] | Stock Option Plan 2007 | Stock Option Plan 2007 | Stock Option Plan 2007 | Stock Option Plan 2007 | Common Stock | Common Stock | Common Stock | Common Stock | Common Stock | Additional Paid-in Capital | Additional Paid-in Capital | Warrant | |||||||
Minimum [Member] | Minimum [Member] | Maximum | Employee Stock Option | Employee Stock Option | Employee Stock Option | Employee Stock Option | ||||||||||||||||||||||||||||||
CompensationPlan | Maximum | |||||||||||||||||||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Shares of common stock issued and sold | ' | ' | ' | ' | ' | ' | 1,197,631 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 620,122 | 4,715,000 | 4,715,000 | ' | ' | ' | ' | ' |
Common stock issued in exchange for 5.375% Convertible Senior Notes | ' | $13,000,000 | ' | $13,000,000 | $0 | $0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock price per share | ' | ' | ' | ' | ' | ' | $20.40 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $20.75 | ' | ' | ' | ' | ' | ' |
Stock Issued During Period, Value, New Issues | ' | ' | 97,800,000 | 92,812,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5,000 | ' | ' | ' | 92,807,000 | ' |
Proceeds from issuance of common stock, net of underwriting discounts and offering expenses | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 92,800,000 | ' | ' |
Stock based compensation expense | ' | ' | ' | 12,700,000 | 9,900,000 | 7,700,000 | ' | ' | 67,000 | 59,000 | 38,000 | ' | ' | ' | ' | 4,600,000 | 4,800,000 | 4,400,000 | 8,000,000 | 5,100,000 | 3,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total unrecognized compensation expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25,200,000 | 7,900,000 | ' | ' | 17,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Vesting period | ' | ' | ' | ' | ' | ' | ' | '4 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '3 years | '4 years | ' | ' | '4 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Expiration period | ' | ' | ' | ' | ' | ' | ' | '10 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '10 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Shares reserved for issuance under the plan | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 380,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 535,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum annual increase in shares of common stock reserved for issuance on January 1, 2012 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 725,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of additional shares available for grant | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,775,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Shares available for future grants | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3,203,111 | ' | ' | ' | ' | ' | ' | ' | ' |
Restriction period | ' | ' | ' | ' | ' | ' | ' | '4 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Options outstanding, shares | ' | ' | ' | 1,828,613 | 2,502,190 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,828,613 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Options outstanding, weighted average exercise price | ' | ' | ' | $16.46 | $13.51 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $16.46 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Options outstanding, weighted average remaining contractual life | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '6 years 9 months 18 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Options exercisable, shares | ' | ' | ' | 1,115,339 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,115,339 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Options exercisable, weighted average exercise price | ' | ' | ' | $13.42 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $13.42 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Options exercisable, weighted average remaining contractual life | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '5 years 8 months 12 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted average grant date fair value of options granted | ' | ' | ' | $15.42 | $12.04 | $11.75 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total unrecognized compensation expense weighted-average period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '1 year 0 months 0 days | ' | ' | '1 year 3 months 18 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Employment period with the Company for eligibility for the plan | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '6 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Customary employment time per week for eligibility for the plan | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '20 hours | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Threshold percentage of voting power, not eligible to purchase shares under the plan | ' | ' | ' | ' | ' | ' | ' | ' | 5.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of offerings under the plan | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Offering period term | ' | ' | ' | ' | ' | ' | ' | ' | '6 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum employee subscription rate | ' | ' | ' | ' | ' | ' | ' | ' | 10.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Discount market price on the last day of the offering period | ' | ' | ' | ' | ' | ' | ' | ' | 85.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Maximum value of shares of common stock an employee is able to purchase at the start of the purchase period under the plan in any calendar year | ' | ' | ' | ' | ' | ' | ' | ' | 25,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Shares issued for employee stock purchase plan | ' | ' | ' | ' | ' | ' | ' | ' | 12,970 | 18,346 | 12,429 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 12,970 | 18,346 | 12,429 | ' | ' | ' |
Shares granted during the period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 588,875 | ' | ' | ' | ' | 142,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Other than options - granted in period, weighted average fair value | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $24.49 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Other than options - grant date fair value | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 14,400,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Other than options - vested in period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 338,325 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Dividend distribution for a preferred stock purchase right for each outstanding share of common stock | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Miminum percentage for rights to become exercisable | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 15.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Repayment of remaining principal of 5.375% Notes | $2,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Debt Conversion, Converted Instrument, Shares Issued | 26,523 | 620,122 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Exercise of warrants to purchase common stock | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 47,392 | ' | ' | ' | ' | 47,392 |
Stock_Option_Activity_Detail
Stock Option Activity (Detail) (USD $) | 12 Months Ended | |||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Number of Options | ' | ' | ' | |
Beginning balance | 2,502,190 | ' | ' | |
Granted | 282,400 | ' | ' | |
Exercised | -872,073 | ' | ' | |
Canceled | -83,904 | ' | ' | |
Ending balance | 1,828,613 | 2,502,190 | ' | |
Vested, at end of period | 1,115,339 | ' | ' | |
Vested and expected to vest, at end of period | 1,562,587 | [1] | ' | ' |
Weighted Average Exercise Price | ' | ' | ' | |
Beginning balance | $13.51 | ' | ' | |
Granted | $25.79 | ' | ' | |
Exercised | $10.67 | ' | ' | |
Canceled | $19.94 | ' | ' | |
Ending balance | $16.46 | $13.51 | ' | |
Vested, at end of period | $13.42 | ' | ' | |
Aggregate Intrinsic Value | ' | ' | ' | |
Exercised | $17,820 | [2] | $9,000 | $8,800 |
Ending balance | 37,742 | ' | ' | |
Vested, at end of period | 26,413 | [3] | ' | ' |
Vested and expected to vest, at end of period | $33,349 | [3] | ' | ' |
[1] | Represents the number of vested options as of December 31, 2013, plus the number of unvested options expected to vest as of December 31, 2013, based on the unvested options outstanding at December 31, 2013, adjusted for the estimated forfeiture rate of 16%. | |||
[2] | The aggregate intrinsic value was calculated based on the positive difference between the estimated fair value of the Company’s common stock as of the date of exercise and the exercise price of the underlying options. The aggregate intrinsic value of options exercised in the years ended December 31, 2013, 2012 and 2011, was $17.8 million, $9.0 million and $8.8 million, respectively. | |||
[3] | The aggregate intrinsic value was calculated based on the positive difference between the estimated fair value of the Company’s common stock as of December 31, 2013, and the exercise price of the underlying options. |
Stock_Option_Activity_Parenthe
Stock Option Activity (Parenthetical) (Detail) (USD $) | 12 Months Ended | |||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | |
Aggregate intrinsic value, exercised in period | $17,820 | [1] | $9,000 | $8,800 |
Estimated forfeiture rate | 16.00% | ' | ' | |
[1] | The aggregate intrinsic value was calculated based on the positive difference between the estimated fair value of the Company’s common stock as of the date of exercise and the exercise price of the underlying options. The aggregate intrinsic value of options exercised in the years ended December 31, 2013, 2012 and 2011, was $17.8 million, $9.0 million and $8.8 million, respectively. |
Employee_Stock_Options_Calcula
Employee Stock Options Calculated using Black-Scholes Option Pricing Model (Detail) (Employee Stock Option) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Employee Stock Option | ' | ' | ' |
Share based Compensation Arrangement by Share based Payment Award, Fair Value Assumptions, Method Used [Line Items] | ' | ' | ' |
Risk-free interest rate, minimum | 0.93% | 0.80% | 1.16% |
Risk-free interest rate, maximum | 1.91% | 1.16% | 2.61% |
Expected term (in years) | '6 years 3 months | '6 years 3 months | '6 years 3 months |
Dividend yield | 0.00% | 0.00% | 0.00% |
Expected volatility, minimum | 63.00% | 67.00% | 72.00% |
Expected volatility, maximum | 66.00% | 71.00% | 76.00% |
Summary_of_Restricted_Stock_Un
Summary of Restricted Stock Units (Detail) (Restricted Stock Units, USD $) | 12 Months Ended |
Dec. 31, 2013 | |
Restricted Stock Units | ' |
Number of Shares | ' |
Beginning balance | 825,068 |
Granted | 588,875 |
Vested | -338,325 |
Forfeited | -63,725 |
Ending balance | 1,011,893 |
Weighted Average Fair Value | ' |
Beginning balance | $18.40 |
Granted | $24.49 |
Vested | $17.43 |
Forfeited | $20.94 |
Ending balance | $22.11 |
Defined_Contribution_Plan_Addi
Defined Contribution Plan - Additional Information (Detail) (USD $) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Defined Contribution Plan Disclosure [Line Items] | ' | ' | ' |
Minimum period of service to participate in 401(k) plan | '30 days | ' | ' |
Percentage of discretionary match employee's salary that was contributed to the 401(k) plan | 50.00% | 50.00% | 50.00% |
Employer contribution percentage | 6.00% | 6.00% | 6.00% |
Award Vesting Period | '4 years | '4 years | '4 years |
Vesting percentage per year | 25.00% | 25.00% | 25.00% |
Employer contribution amount | $1 | $1 | $0.70 |
Maximum | ' | ' | ' |
Defined Contribution Plan Disclosure [Line Items] | ' | ' | ' |
Percentage of compensation eligible employees can contribute | 20.00% | ' | ' |
Income_Taxes_Income_Tax_Benefi
Income Taxes - Income Tax Benefit (Expense) (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Disclosure Income Tax Benefit Expense [Abstract] | ' | ' | ' |
Current | ($16) | ($121) | ($77) |
Deferred | -84 | -91 | 11,289 |
Total income tax benefit (expense) | ($100) | ($212) | $11,212 |
Income_Taxes_Reconciliation_of
Income Taxes - Reconciliation of Income Tax Expense (Benefit) at Statutory Federal Income Tax Rate (Detail) | 12 Months Ended | ||
Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Disclosure Reconciliation Of Income Tax Expense Benefit At Statutory Federal Income Tax Rate [Abstract] | ' | ' | ' |
Tax at U.S. statutory rate | 34.00% | 34.00% | 34.00% |
State taxes, net of federal benefit | -4.21% | -1.18% | -1.88% |
Tax credits | 4.98% | 0.50% | 2.07% |
Non-deductible expenses | -5.49% | -1.37% | -1.96% |
Change in valuation allowance | -29.32% | -32.34% | -11.65% |
Other | -0.18% | -0.01% | -0.92% |
Effective income tax rate | -0.22% | -0.40% | 19.66% |
Income_Taxes_Components_of_Com
Income Taxes - Components of Company's Deferred Tax Assets (Liabilities) (Detail) (USD $) | Dec. 31, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Deferred tax assets: | ' | ' |
Net operating loss carryforwards | $154,872 | $151,818 |
Start up expenditures | 1,672 | 2,020 |
Tax credits | 9,841 | 7,608 |
Bad debt | 2,679 | 2,602 |
Depreciation & amortization | 1,675 | 2,357 |
Other | 6,357 | 4,661 |
Total deferred tax assets | 177,096 | 171,066 |
Deferred tax liabilities: | ' | ' |
Prepaid Expenses | -310 | -169 |
Amortization of acquired intangibles | -6,734 | -9,015 |
Amortization of debt discount | -11,214 | -15,955 |
Goodwill | -223 | -139 |
Other | -515 | 0 |
Total deferred tax liabilities | -18,996 | -25,278 |
Valuation allowance | -158,323 | -145,927 |
Net deferred tax liabilities | ($223) | ($139) |
Income_Taxes_Additional_Inform
Income Taxes - Additional Information (Detail) (USD $) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Disclosure Income Taxes Additional Information [Abstract] | ' | ' |
Valuation allowance | ($158,323,000) | ($145,927,000) |
Increase (decrease) in valuation allowance | 12,400,000 | ' |
Federal net operating loss carryforwards | 461,700,000 | 404,400,000 |
State net operating loss carryforwards | 217,500,000 | 282,800,000 |
Tax credits | 9,841,000 | 7,608,000 |
Unrecognized tax benefits | $0 | $100,000 |
Quarterly_Data_Unaudited_Selec
Quarterly Data (Unaudited) - Selected Quarterly Data (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Jun. 30, 2012 | Mar. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Disclosure Selected Quarterly Data [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Other income | ' | ' | ' | ' | ' | ' | ' | ' | $1,351,000 | $0 | $0 |
Revenue | 68,533,000 | 61,103,000 | 60,092,000 | 57,356,000 | 57,828,000 | 54,752,000 | 51,035,000 | 47,754,000 | 247,084,000 | 211,369,000 | 152,255,000 |
Gross profit | 33,018,000 | 27,395,000 | 26,833,000 | 25,155,000 | 25,319,000 | 24,390,000 | 22,331,000 | 20,296,000 | 112,401,000 | 92,336,000 | 66,712,000 |
Net loss | -2,500,000 | -21,290,000 | -10,519,000 | -10,665,000 | -10,194,000 | -12,417,000 | -14,476,000 | -14,780,000 | -44,974,000 | -51,867,000 | -45,831,000 |
Net loss per share | ($0.04) | ($0.39) | ($0.20) | ($0.20) | ($0.21) | ($0.26) | ($0.30) | ($0.31) | ($0.83) | ($1.08) | ($0.98) |
Gain (Loss) on Derivative Instruments, Net, Pretax | ' | $200,000 | $300,000 | $100,000 | $300,000 | ' | ' | ' | ' | ' | ' |
Schedule_II_Valuation_And_Qual1
Schedule II - Valuation And Qualifying Accounts - Accounts Receivable Reserve and Deferred Tax Valuation Allowance Accounts (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Allowance for doubtful accounts | ' | ' | ' |
Valuation and Qualifying Accounts Disclosure [Line Items] | ' | ' | ' |
Balance Beginning of Period | $6,627 | $7,021 | $5,432 |
Additions Charged to Costs and Expenses | 4,741 | 3,409 | 3,165 |
Deductions | 4,235 | 3,803 | 1,576 |
Balance End of Period | 7,133 | 6,627 | 7,021 |
Deferred tax valuation allowance | ' | ' | ' |
Valuation and Qualifying Accounts Disclosure [Line Items] | ' | ' | ' |
Balance Beginning of Period | 145,927 | 129,223 | 138,028 |
Additions Charged to Costs and Expenses | 32,050 | 20,972 | 27,047 |
Deductions | 19,654 | 4,268 | 35,852 |
Balance End of Period | $158,323 | $145,927 | $129,223 |