Glaukos (GKOS) 10-Q 14 Nov 16 2016 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2016	Nov. 10, 2016
Document and Entity Information
Entity Registrant Name	GLAUKOS Corp
Entity Central Index Key	1,192,448
Document Type	10-Q
Document Period End Date	Sep. 30, 2016
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		33,549,174
Document Fiscal Year Focus	2,016
Document Fiscal Period Focus	Q3

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Current assets:
Cash and cash equivalents	$ 4,988	$ 21,572
Short-term investments	88,615	69,552
Accounts receivable, net	11,747	7,549
Inventory	6,453	4,097
Prepaid expenses and other current assets	2,708	1,290
Restricted cash	80	80
Total current assets	114,591	104,140
Property and equipment, net	6,994	2,154
Intangible asset, net	7,479	10,218
Deposits and other assets	188	149
Total assets	129,252	116,661
Current liabilities:
Accounts payable	4,714	3,626
Accrued liabilities	11,048	7,793
Long-term debt, current portion	3,039	8,931
Deferred rent	40	12
Total current liabilities	18,841	20,362
Long-term debt, less current portion		765
Stock warrant liability		105
Other liabilities	208	238
Total liabilities	19,049	21,470
Commitments and contingencies (see Note 7)
Stockholders' equity (deficit):
Preferred stock, $0.001 par value; 5,000 shares authorized at September 30, 2016 and December 31, 2015; no shares issued and outstanding at September 30, 2016 and December 31, 2015
Common stock, $0.001 par value; 150,000 shares authorized at September 30, 2016 and December 31, 2015; 33,337 and 32,209 shares issued and 33,309 and 32,181 shares outstanding at September 30, 2016 and December 31, 2015, respectively	33	32
Additional paid-in capital	302,678	291,853
Accumulated other comprehensive (loss) income	(151)	51
Accumulated deficit	(192,225)	(196,613)
Total stockholders' equity before treasury stock	110,335	95,323
Less treasury stock (28 shares as of September 30, 2016 and December 31, 2015)	(132)	(132)
Total stockholders' equity	110,203	95,191
Total liabilities and stockholders' equity	$ 129,252	$ 116,661

CONSOLIDATED BALANCE SHEETS (PA

CONSOLIDATED BALANCE SHEETS (PARENTHETICAL) - $ / shares shares in Thousands	Sep. 30, 2016	Dec. 31, 2015
CONDENSED CONSOLIDATED BALANCE SHEETS
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized	5,000	5,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized	150,000	150,000
Common stock, shares issued	33,337	32,209
Common stock, shares outstanding	33,309	32,181
Treasury stock, shares	28	28

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Net sales	$ 29,577	$ 19,004	$ 81,225	$ 51,424
Cost of sales	3,886	3,319	11,366	9,394
Gross profit	25,691	15,685	69,859	42,030
Operating expenses:
Selling, general and administrative	16,854	11,237	44,262	31,569
Research and development	7,807	6,173	21,824	18,752
Total operating expenses	24,661	17,410	66,086	50,321
Income (loss) from operations	1,030	(1,725)	3,773	(8,291)
Other income (expense), net
Interest and other income	314	10	935	10
Loss on deconsolidation of DOSE				(25,685)
Loss on extinguishment of debt		(195)		(195)
Interest and other expense, net	(45)	(178)	(223)	(740)
Change in fair value of stock warrant liability		31	43	(1,130)
Total other income (expense), net	269	(332)	755	(27,740)
Income (loss) before taxes	1,299	(2,057)	4,528	(36,031)
Provision for income taxes	140		140
Net income (loss)	1,159	(2,057)	4,388	(36,031)
Net loss attributable to noncontrolling interest				(1,080)
Net income (loss) attributable to Glaukos Corporation	$ 1,159	$ (2,057)	$ 4,388	$ (34,951)
Basic net income (loss) per share attributable to Glaukos Corporation stockholders	$ 0.03	$ (0.06)	$ 0.13	$ (2.78)
Diluted net income (loss) per share attributable to Glaukos Corporation stockholders	$ 0.03	$ (0.07)	$ 0.12	$ (2.78)
Weighted average shares used to compute basic net income (loss) per share attributable to Glaukos Corporation stockholders	33,116	32,006	32,691	12,551
Weighted average shares used to compute diluted net income (loss) per share attributable to Glaukos Corporation stockholders	37,023	32,013	36,259	12,551

CONDENSED CONSOLIDATED STATEME5

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
Net income (loss)	$ 1,159	$ (2,057)	$ 4,388	$ (36,031)
Other comprehensive (loss) gain:
Unrealized (loss) gain on short-term investments, net of income tax expense of $0.1 million for the three months and the nine months ended September 30, 2016	(175)		151
Foreign currency translation adjustments	81	12	(353)	51
Other comprehensive (loss) gain	(94)	12	(202)	51
Total comprehensive income (loss)	1,065	(2,045)	4,186	(35,980)
Comprehensive loss attributable to noncontrolling interest				(1,080)
Comprehensive income (loss) attributable to Glaukos Corporation	$ 1,065	$ (2,045)	$ 4,186	$ (34,900)

CONDENSED CONSOLIDATED STATEME6

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (PARENTHETICAL) - USD ($) $ in Millions	3 Months Ended	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2016
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
Unrealized (loss) gain on short-term investments, income tax expense	$ 0.1	$ 0.1

CONDENSED CONSOLIDATED STATEME7

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015
Operating Activities
Net income (loss)	$ 4,388	$ (36,031)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization	3,410	3,199
Stock-based compensation	6,117	6,331
Unrealized foreign currency gains	(311)
Loss on deconsolidation of DOSE		25,685
Loss on extinguishment of debt		186
Change in fair value of stock warrant liability	(43)	1,130
Amortization of debt discount and deferred financing costs		15
Amortization of premium on short-term investments	206
Deferred rent	(1)	61
Change in operating assets and liabilities:
Accounts receivable, net	(4,170)	(1,588)
Inventory	(2,191)	(900)
Prepaid expenses and other current assets	(1,396)	(748)
Accounts payable and accrued liabilities	2,996	1,162
Other assets	26	(120)
Net cash provided by (used in) operating activities	9,031	(1,618)
Investing activities
Proceeds from sale and maturities of short-term investments	41,702
Purchases of short-term investments	(60,724)
Purchase of iDOSE product line and related assets from DOSE Medical		(15,000)
Purchases of property and equipment	(4,236)	(502)
Net cash used in investing activities	(23,258)	(15,502)
Financing activities
Proceeds from public offering, net of issuance costs		113,589
Proceeds from senior secured term and draw-to term loans		6,852
Payments of senior secured term and draw-to term loans		(7,000)
Payments of line of credit		(1,850)
Payments of secured notes	(6,656)	(5,640)
Proceeds from exercise of stock options	3,749	1,719
Share purchases under Employee Stock Purchase Plan	793
Proceeds from exercise of stock warrants	50	428
Net cash (used in) provided by financing activities	(2,064)	108,098
Effect of exchange rate changes on cash and cash equivalents	(293)	57
Net (decrease) increase in cash and cash equivalents	(16,584)	91,035
Cash and cash equivalents at beginning of period	21,572	2,304
Cash and cash equivalents at end of period	4,988	93,339
Supplemental disclosures of cash flow information
Interest paid	253	694
Taxes paid	64	14
Supplemental schedule of noncash investing and financing activities
Reduction of liability upon vesting of stock options previously exercised for unvested stock	$ 54	$ 65

Organization and Basis of Prese

Organization and Basis of Presentation	9 Months Ended
	Sep. 30, 2016
Organization and Basis of Presentation
Organization and Basis of Presentation	Note 1. Organization and Basis of Presentation Organization and business Glaukos Corporation (Glaukos or the Company), incorporated in Delaware on July 14, 1998, is a developer, manufacturer and marketer of medical devices for the treatment of glaucoma. The accompanying condensed consolidated financial statements include the ac c ounts of Glaukos and its wholly-owned subsidiaries and, through June 30, 2015, affiliated entity DOSE Medical Corporation (DOSE) (see Note 8). All significant intercompany balances and transactions among the consolidated entities have been eliminated in consolidation. Initial public offering On June 30, 2015, the Company completed its initial public offering (IPO), selling 6.9 million newly issued shares of common stock at a price of $18.00 per share. The IPO generated net cash proceeds of approximately $113.6 million, after deducting underwriting discounts and commissions of approximately $8.7 million and other related expenses of approximately $1.9 million. The underwriting discounts and commissions and offering costs were recorded as a reduction to the IPO proceeds included in additional paid-in capital. Immediately prior to the closing of the IPO, all unexercised warrants to purchase shares of Series D convertible preferred stock were net exercised at the IPO price per share, and then all outstanding shares of convertible preferred stock automatically converted into approximately 21.7 million shares of common stock. Following the completion of the IPO, there were no shares of preferred stock and no warrants to purchase shares of Series D convertible preferred stock outstanding. An additional 4.5 million shares of common stock were reserved for issuance under the Company’s 2015 Omnibus Incentive Compensation Plan and 450,000 shares of common stock were reserved for the Company’s 2015 Employee Stock Purchase Plan (ESPP). Acquisition of certain DOSE Medical Corporation assets On June 30, 2015, the Company acquired certain assets from DOSE, including the iDose product line, in exchange for a cash payment of $15.0 million and the elimination of all amounts owed by DOSE to the Company. In addition to an asset purchase, the parties agreed to an amended and restated patent license agreement and an amended and restated transition services agreement that provides for limited support from the Company to DOSE for a period of up to three years (see Note 8). Basis of presentation The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) for interim financial information and pursuant to the instructions to Form 10-Q and Article 10 of Regulation S-X. The unaudited interim financial statements have been prepared on a basis consistent with the audited financial statements. As permitted under those rules, certain footnotes and other financial information that are normally required by GAAP have been condensed or omitted. In the opinion of management, the unaudited interim financial statements reflect all adjustments, which include normal recurring adjustments, necessary for the fair presentation of the Company’s financial information, contained herein. The condensed consolidated balance sheet at December 31, 2015 has been derived from audited financial statements at that date, but excludes disclosures required by GAAP for complete financial statements. These interim financial statements do not include all disclosures required by GAAP and should be read in conjunction with the Company’s financial statements and accompanying notes for the fiscal year ended December 31, 2015, which are contained in the Company’s Annual Report on Form 10-K filed with the United States Securities and Exchange Commission (SEC) on March 15, 2016. The results for the period ended September 30, 2016 are not necessarily indicative of the results to be expected for the year ended December 31, 2016 or for any other interim period.

Summary of Significant Accounti

Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2016
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies	Note 2. Summary of Significant Accounting Policies There have been no significant changes in the Company’s significant accounting policies during the nine months ended September 30, 2016, as compared with those disclosed in its Annual Report on Form 10-K for the year ended December 31, 2015 filed with the SEC on March 15, 2016. Use of estimates The preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts in the financial statements and accompanying notes. Actual results could differ materially from those estimates and assumptions. Management considers many factors in selecting appropriate financial accounting policies and controls and in developing the estimates and assumptions that are used in the preparation of these financial statements. Management must apply significant judgment in this process. In addition, other factors may affect estimates, including expected business and operational changes, sensitivity and volatility associated with the assumptions used in developing estimates, and whether historical trends are expected to be representative of future trends. The estimation process often may yield a range of potentially reasonable estimates of the ultimate future outcomes, and management must select an amount that falls within that range of reasonable estimates. The most significant estimates in the accompanying condensed consolidated financial statements relate to revenue recognition, inventory reserves and stock‑based compensation expense. Although these estimates are based on the Company’s knowledge of current events and actions it may undertake in the future, this process may result in actual results differing materially from those estimated amounts used in the preparation of the financial statements . Foreign currency translation The accompanying condensed consolidated financial statements are presented in U.S. dollars. The Company considers the local currency to be the functional currency for its international subsidiaries. Accordingly, their assets and liabilities are translated into U.S. dollars using the exchange rate in effect on the balance sheet date. Revenues and expenses are translated at average exchange rates prevailing throughout the periods presented. Currency translation adjustments arising from period to period are charged or credited to accumulated other comprehensive (loss) income in stockholders’ equity. For the three months ended September 30, 2016 and 2015 and the nine months ended September 30, 2016 and 2015, the Company reported (losses) gains from foreign currency translation adjustments of approximately $(16,000), $12,000, $(450,000) and $51,000, respectively. Realized gains and losses resulting from foreign currency transactions are included in selling, general and administrative expense in the condensed consolidated statements of operations. For the three months ended September 30, 2016 and 2015 and the nine months ended September 30, 2016 and 2015, the Company reported foreign currency transaction gains (losses) of $51,000, $(13,000), $73,000 and $(98,000). Cash, cash equivalents and short-term investments The Company invests its excess cash in marketable securities, including money market funds, asset-backed securities, bank certificates of deposit, corporate bonds, and corporate commercial paper, U.S. government bonds and U.S. government agency bonds. For financial reporting purposes, liquid investment instruments purchased with an original maturity of three months or less are considered to be cash equivalents. Cash and cash equivalents are recorded at face value or cost, which approximates fair market value. From time to time, the Company maintains cash balances in excess of amounts insured by the Federal Deposit Insurance Commission. Investments are stated at fair value as determined by quoted market prices. Investments are considered available-for-sale and, accordingly, unrealized gains and losses are included in accumulated other comprehensive (loss) income within stockholders’ equity. The Company’s entire investment portfolio, except for restricted cash, is considered to be available for use in current operations and, accordingly, all such investments are stated at fair value using quoted market prices and classified as current assets, although the stated maturity of individual investments may be one year or more beyond the balance sheet date. The Company did not have any trading securities or restricted investments at September 30, 2016 and December 31, 2015. Realized gains and losses and declines in value, if any, judged to be other-than-temporary on available-for-sale securities, are reported in interest income or expense, net. When securities are sold, any associated unrealized gain or loss previously reported as a separate component of stockholders’ equity is reclassified out of stockholders’ equity and recorded in the statements of operations in the period sold. Accrued interest and dividends are included in interest income. The Company periodically reviews its available-for-sale securities for other-than-temporary declines in fair value below the cost basis, and whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company has a credit card facility with its primary operating bank which is collateralized by certificates of deposit maintained at the bank. Fair value measurements Assets and liabilities are measured using quoted prices in active markets and total fair value is the published market price per unit multiplied by the number of units held without consideration of transaction costs. Assets and liabilities that are measured using significant other observable inputs are valued by reference to similar assets or liabilities, adjusted for contract restrictions and other terms specific to that asset or liability. For these items, a significant portion of fair value is derived by reference to quoted prices of similar assets or liabilities in active markets. For all remaining assets and liabilities, fair value is derived using a fair value model, such as a discounted cash flow model or Black-Scholes model. Fair value of financial instruments The carrying amounts of cash equivalents, accounts receivable, accounts payable, and accrued liabilities are considered to be representative of their respective fair values because of the short-term nature of those instruments. Based on the borrowing rates for loans currently available to the Company for loans with similar terms, the Company believes that the fair value of long-term debt approximates its carrying value. The carrying amount of the warrant liability and non-controlling interest represent their fair values. The valuation of assets and liabilities are subject to fair value measurements using a three-tiered approach and fair value measurements are classified and disclosed by the Company in one of the following three categories: Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; Level 2: Quoted prices for similar assets and liabilities in active markets, quoted prices in markets that are not active, or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability; and Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity). Revenue recognition The Company recognizes revenue from product sales when the following criteria are met: goods are shipped, title and risk of loss has transferred to its customers, persuasive evidence of an arrangement exists and collectability is reasonably assured. Persuasive evidence of an arrangement exists when there is a contractual arrangement in place with the customer. Delivery has occurred when a product is shipped. If persuasive evidence of an arrangement exists and delivery has occurred, the Company determines whether the invoiced amount is fixed or determinable and collectability of the invoiced amount is reasonably assured. The Company assesses whether the invoiced amount is fixed or determinable based on the existing arrangement with the customer, including whether the Company has sufficient history with a customer to reliably estimate the customer’s payment patterns. The Company assesses collectability by evaluating historical cash receipts and individual customer outstanding balances. To the extent all criteria set forth above are not satisfied at the time of shipment, revenue is recognized when cash is received from the customer. Customers are not granted specific rights of return; however, the Company may permit returns of product from customers if such product is returned in a timely manner and in good condition. The Company provides a warranty on its products for one year from the date of shipment, and any product found to be defective or out of specification will be replaced at no charge during the warranty period. Estimated allowances for sales returns and warranty replacements are recorded at the time of sale of the product and are estimated based upon the historical patterns of product returns matched against sales, and an evaluation of specific factors that may increase the risk of product returns. Product returns and warranty replacements to date have been consistent with amounts reserved or accrued and have not been significant. Research and development expenses Major components of research and development expense include personnel costs, preclinical studies, clinical trials and related clinical product manufacturing, materials and supplies, and fees paid to consultants. Research and development costs are expensed as goods are received or services are rendered. Costs to acquire technologies to be used in research and development that have not reached technological feasibility and have no alternative future use are also expensed as incurred. At each financial reporting date, the Company accrues the estimated costs of clinical study activities performed by third party clinical sites with whom the Company has agreements providing for fees based upon the quantities of subjects enrolled and clinical evaluation visits that occur over the life of the study. The cost estimates are determined based upon a review of the agreements and data collected by internal and external clinical personnel as to the status of enrollment and subject visits, and are based upon the facts and circumstances known to the Company at each financial reporting date. If the actual performance of activities varies from the assumptions used in the cost estimates, the accruals are adjusted accordingly. There have been no material adjustments to the Company’s prior period accrued estimates for clinical trial activities through September 30, 2016. Stock-based compensation The Company recognizes compensation expense for all stock-based awards granted to employees and nonemployees, including members of its Board of Directors. The fair value of stock-based awards made to employees is estimated at the grant date using the Black-Scholes option pricing model, and the portion that is ultimately expected to vest is recognized as compensation cost over the requisite service period using the straight-line method. The determination of the fair value-based measurement of stock options on the date of grant using an option pricing model is affected by the determination of the fair value of the underlying stock as well as assumptions regarding a number of highly complex and subjective variables. These variables include, but are not limited to, the Company’s stock price volatility over the expected term of the grants, and actual and projected employee stock option exercise behaviors. In the future, as additional empirical evidence regarding these estimates becomes available, the Company may change or refine its approach of deriving them, and these changes could impact the fair value-based measurement of stock options granted in the future. Changes in the fair value-based measurement of stock awards could materially impact the Company’s operating results. The fair values of stock-based awards made to nonemployees are remeasured at each reporting period using the Black-Scholes option pricing model. Compensation expense for these stock-based awards is determined by applying the remeasured fair values to the shares that have vested during a period. Net income (loss) per share Basic net income (loss) per share is calculated by dividing the net income (loss) by the weighted average number of common shares that were outstanding for the period, without consideration for common stock equivalents. Diluted net income (loss) per share is calculated by dividing the net income by the sum of the weighted average number of dilutive common share equivalents outstanding for the period determined using the treasury stock method. Common stock equivalents are comprised of stock options and warrants outstanding. Diluted net loss per share is calculated by dividing the net loss by the weighted average number of common shares that were outstanding for the period, without consideration for common stock equivalents, as their inclusion would be anti-dilutive . The Company’s computation of net income (loss) per share is as follows (in thousands, except per share amounts): Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Numerator: Net income (loss) attributable to Glaukos Corporation - basic $ $ (2,057) $ $ (34,951) Adjustment for revaluation of warrants - (31) - - Net income (loss) attributable to Glaukos Corporation - diluted $ $ $ $ Denominator: Weighted average number of common shares outstanding - basic Common stock equivalents from outstanding common stock options - - Common stock equivalents from outstanding common stock warrants - - Common stock equivalents for ESPP - - Weighted average number of common shares outstanding - diluted Basic net income (loss) per share attributable to Glaukos Corporation common stockholders $ $ $ $ Diluted net income (loss) per share attributable to Glaukos Corporation common stockholders $ $ $ $ Potentially dilutive securities not included in the calculation of diluted net loss per share attributable to common stockholders because to do so would be anti-dilutive were as follows (in common stock equivalent shares, in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Stock options outstanding ESPP - - - Common stock warrants outstanding - - Recent accounting pronouncements In May 2014, the Financial Accounting Standards Board (FASB) issued guidance in Accounting Standards Update (ASU) 2014-09 which was codified in Accounting Standard Codification ASC 606, Revenue Recognition — Revenue from Contracts with Customers , which amends the guidance in former ASC 605, Revenue Recognition , which provides a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and will supersede most current revenue recognition guidance. This ASU is based on the principle that revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The ASU also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. In August 2015, the FASB issued ASU 2015-14, which deferred the effective date to annual reporting periods beginning after December 15, 2017 (including interim periods within those periods). Early adoption is permitted to the original effective date of December 15, 2016 (including interim periods within those periods). The Company is currently evaluating the impact of the provisions of ASC 606 on its consolidated financial statements. In July 2015, the FASB issued ASU 2015-11, Inventory (Topic 330), Simplifying the Measurement of Inventory , which changes the measurement principle for inventory from the lower of cost or market to the lower of cost and net realizable value. ASU 2015-11 defines net realizable value as estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The new guidance became effective for the Company on January 1, 2016 and the adoption had no impact on its consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). The ASU requires management to recognize on the balance sheet lease assets and lease liabilities by lessees for all operating leases. The ASU is effective for periods ending on December 15, 2018 and interim periods therein on a modified retrospective basis. The Company is currently evaluating the impact adoption of this guidance will have on its consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09, Compensation - Stock Compensation (Topic 718), Improvements to Employee Share-Based Payment Accounting . The standard is intended to simplify several areas of accounting for share-based compensation arrangements, including the income tax impact, classification on the statement of cash flows and forfeitures. ASU 2016-09 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2016, and early adoption is permitted. The Company is currently evaluating the impact this guidance will have on its consolidated financial statements. In April 2016, the FASB issued ASU No. 2016-10 Revenue from Contracts with Customers (Topic 606), Identifying Performance Obligations and Licensing . ASU 2016-10 clarifies the following two aspects of Topic 606: identifying performance obligations and the licensing implementation guidance, while retaining the related principles for those areas. ASU 2016-10 is effective for public business entities for annual periods, including interim periods within those annual periods, beginning after December 15, 2017, with early application permitted. The Company is currently evaluating the impact this guidance will have on its consolidated financial statements.

Balance Sheet Details

Balance Sheet Details	9 Months Ended
	Sep. 30, 2016
Balance Sheet Details
Balance Sheet Details	Note 3. Balance Sheet Details Short-term investments Short-term investments consisted of the following (in thousands): At September 30, 2016 Maturity Amortized cost Unrealized Unrealized Estimated (in years) or cost gains losses fair value U.S. government bonds 1-3 $ $ $ $ U.S. government agency bonds less than 3 - Bank certificates of deposit less than 2 Commercial paper less than 1 Corporate notes less than 3 Asset-backed securities less than 2 - Total $ $ $ $ At December 31, 2015 Maturity Amortized cost Unrealized Unrealized Estimated (in years) or cost gains losses fair value U.S. government agency bonds 1-3 $ $ - $ $ Commercial paper less than 1 - Corporate notes 1-3 - Asset-backed securities 1-3 - Total $ $ - $ $ Accounts receivable, net Accounts receivable consisted of the following (in thousands): September 30, December 31, 2016 2015 Accounts receivable $ $ Less allowance for doubtful accounts $ $ Inventory Inventory consisted of the following (in thousands): September 30, December 31, 2016 2015 Finished goods $ $ Work in process Raw material $ $ Accrued liabilities Accrued liabilities consisted of the following (in thousands): September 30, December 31, 2016 2015 Accrued bonuses and sales commissions $ $ Accrued vacation benefits Accrued clinical study payments Other accrued liabilities $ $

Fair Value Measurements

Fair Value Measurements	9 Months Ended
	Sep. 30, 2016
Fair Value Measurements
Fair Value Measurements	Note 4. Fair Value Measurements Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. The following tables present information about the Company's financial assets and financial liabilities measured at fair value on a recurring basis as of September 30, 2016 and December 31, 2015, and indicate the fair value hierarchy of the valuation techniques utilized by the Company to determine such fair value (in thousands): At September 30, 2016 September 30, Quoted prices active Significant Significant 2016 (Level 1) (Level 2) (Level 3) Assets Money market funds (i) $ $ $ - $ - U.S. government bonds - - U.S. government agency bonds - - Bank certificates of deposit - - Commercial paper (ii) - - Corporate notes - - Asset-backed securities - - Total assets $ $ $ $ - Liabilities Stock warrant liability $ - $ - $ - $ - Total liabilities $ - $ - $ - $ - At December 31, 2015 December 31, Quoted prices active Significant Significant 2015 (Level 1) (Level 2) (Level 3) Assets Money market funds (i) $ $ $ - $ - U.S. government agency bonds - - Commercial paper (ii) - - Corporate notes (ii) - - Asset-backed securities (ii) - - Total assets $ $ $ $ - Liabilities Stock warrant liability $ $ - $ - $ Total liabilities $ $ - $ - $ (i) Included in cash and cash equivalents with a maturity of three months or less from date of purchase on the condensed consolidated balance sheets. (ii) Included in cash and cash equivalents or short-term investments on the condensed consolidated balance sheets. Money market funds are liquid investments and are actively traded. The pricing information on these investment instruments is readily available and can be independently validated as of the measurement date. This approach results in the classification of these securities as Level 1 of the fair value hierarchy. U.S. government bonds, U.S. government agency bonds, bank certificates of deposit, commercial paper, corporate notes and asset-backed securities are measured at fair value using Level 2 inputs. The Company reviews trading activity and pricing for these investments as of each measurement date. When sufficient quoted pricing for identical securities is not available, the Company uses market pricing and other observable market inputs for similar securities obtained from third party data providers. These inputs represent quoted prices for similar assets in active markets or these inputs have been derived from observable market data. This approach results in the classification of these securities as Level 2 of the fair value hierarchy. The stock warrant liability is recorded at fair value using the Black Scholes option pricing model, which requires inputs such as the expected term of the warrant, volatility and risk free interest rate. These inputs are subjective and generally require significant analysis and judgment to develop, and are therefore considered Level 3 inputs. In conjunction with the Company’s February 2015 Amended and Restated Revolving Credit and Term Loan Agreement as more fully described in Note 5, the Company issued warrants to the lenders to purchase 11,298 shares of common stock at an exercise price of $8.85 per share. The fair value of the warrants as of the issuance date was estimated to be $53,000 using an option pricing framework considering multiple exit scenarios and the probability of a down‑round financing. The following assumptions were deemed by the Company to be significant unobservable inputs: risk‑free interest rate of 1.9%; dividend yield of 0.0%; expected volatility of 70.0%; and an expected life of 7 years. One warrant to purchase 5,649 shares of common stock was exercised by one of the lenders in September 2015. The fair value of the warrants to purchase the remaining 5,649 shares of common stock as of December 31, 2015 was estimated to be $0.1 million using the Black‑Scholes valuation model with the following assumptions deemed by the Company to be significant unobservable inputs: risk‑free interest rate of 1.9%; dividend yield of 0.0%; expected volatility of 54.8%; and an expected life of 6.2 years. In February 2016, the other lender exercised the remaining warrant to purchase 5,649 shares of common stock. For the three months ended September 30, 2015 and the nine months ended September 30, 2016 and 2015, the Company recorded other income (expense) of $31,000, $43,000 and $(1.1 million), respectively, related to changes in the fair value of the warrants. For the three months ended September 30, 2016, due to the exercise in full of the warrants as of February 2016, the Company did not record any change in the fair value of the warrants. The following table provides a reconciliation of liabilities measured at fair value using Level 3 significant unobservable inputs on a recurring basis (in thousands): Warrant Balance at December 31, 2015 $ Change in the fair value of stock warrants Issuance of common stock in connection with exercise of common stock warrant Balance at September 30, 2016 $ - There were no transfers between levels within the fair value hierarchy during the periods presented.

Long-term Debt

Long-term Debt	9 Months Ended
	Sep. 30, 2016
Long-Term Debt.
Long-Term Debt	Note 5. Long-Term Debt Notes payable in connection with GMP Vision Solutions In January 2007, the Company entered into an agreement (the Original GMP Agreement) with GMP Vision Solutions, Inc. (GMP) to acquire certain in-process research and development. In connection with the Original GMP Agreement, the Company was obligated to make periodic royalty payments equal to a single-digit percentage of revenues received for royalty-bearing products and periodic royalty payments at a higher royalty rate applied to all amounts received in connection with the grant of licenses or sublicenses of the related intellectual property. In December 2012, the Company entered into an agreement with GMP in which it paid GMP $1.0 million for a 90-day option to buy out all remaining royalties payable to GMP. In April 2013, the option expired unexercised and, as provided in the agreement, the $1.0 million payment satisfied the Company’s obligation to pay the first $1.0 million in royalties earned beginning on January 1, 2013. The $1.0 million payment was recorded in cost of sales in the year ended December 31, 2012. In November 2013, the Company entered into an amended agreement with GMP in which remaining royalties payable to GMP (the Buyout Agreement) were canceled in exchange for the issuance of $17.5 million in promissory notes payable to GMP and a party related to GMP (together, the GMP Note Parties). The GMP notes are collateralized by all of the Company’s assets, excluding intellectual property. However, in connection with the Buyout Agreement, the GMP Note Parties entered into agreements with the Company’s primary bank pursuant to which any collateralized interests, liens, rights of payment or ability to initiate any enforcement actions in the event of an event of default were subordinate to the rights of the Company’s primary bank under the Credit Agreement (and subsequently, the Amended Credit Agreement) which was paid off in full on July 31, 2015. The Buyout Agreement also calls for a payment of up to $2.0 million in the event of a sale of the Company meeting certain criteria. The promissory notes carry an interest rate of 5% per annum and required monthly interest only payments from November 30, 2013 through December 31, 2014 of $72,900, followed by 24 equal monthly principal and interest payments of $767,700, which began on January 31, 2015 and end on December 31, 2016. The Company concluded that the $17.5 million transaction represented the purchase of an intangible asset. The Company estimated a useful life of five years over which the intangible asset is being amortized to cost of sales in the accompanying statements of operations, which amortization period was determined after consideration of the projected outgoing royalty payment stream had the Buyout Agreement not occurred, and the remaining life of the patents obtained in the Original GMP Agreement. After determining that the pattern of future cash flows associated with this intangible asset could not be reliably estimated with a high level of precision, the Company concluded that the intangible asset will be amortized on a straight-line basis over the estimated useful life. Bank loan facility In June 2013, the Company entered into a Loan and Security Agreement (the Credit Agreement) with the Company’s primary bank, under which the bank agreed to extend to the Company a line of credit in the maximum principal amount of $6.0 million. Advances under the line of credit were limited to the lesser of (i) $6.0 million or (ii) 77% of the sum of cash, cash equivalents and eligible domestic accounts receivable. The entire unpaid principal amount plus any accrued but unpaid interest were to become due and payable in full on June 5, 2015. Obligations under the Credit Agreement bore interest on the outstanding daily balance thereof at the bank’s prime rate plus 0.5% (3.75% at December 31, 2014). Amounts owed were secured by a first priority security interest in all of the Company’s assets, excluding intellectual property. The Credit Agreement included certain reporting and financial covenants which, if not met, could have constituted an event of default under the Credit Agreement. In February 2015, the Credit Agreement was amended and restated, at which time the balance outstanding on the line of credit was $2.1 million. In February 2015, the Company and its primary bank executed an Amended and Restated Revolving Credit and Term Loan Agreement, or the Amended Credit Agreement, which provided for a $5.0 million senior secured term loan, a $5.0 million senior secured draw-to term loan and an $8.0 million senior secured revolving credit facility. The senior secured term loan and draw-to term loan would have matured and would have been required to be fully paid by February 23, 2019. On the closing date, the Company received $5.0 million cash under the senior secured term loan. The entire unpaid principal amount plus any accrued but unpaid interest under the revolving line of credit was due to become payable in full on February 23, 2017. As of July 31, 2015, the Company had drawn $2.0 million under the draw-to term loan. On July 31, 2015, the Company paid off all amounts outstanding under the Amended Credit Agreement with the payment of $7.0 million in principal plus all interest and fees payable through the payoff date, and recorded a loss on extinguishment of debt in the amount of $0.2 million. The Amended Credit Agreement and all related security interests were terminated on July 31, 2015. Outstanding balances under the senior secured term loan and senior secured draw-to term loan bore interest on the outstanding daily balance at an annual percentage rate equal to the bank’s prime rate plus 2%. At the Company’s option all or a portion of the amounts owed under any of the senior secured term loan and draw-to term loan may have been converted into Eurodollar-based advances at an annual percentage rate equal to LIBOR plus 3%. Outstanding balances under the revolving credit facility bore interest on the outstanding daily balance thereof at an annual percentage rate equal to the bank’s prime rate plus 1.75%. At the Company’s option all or a portion of the amounts owed under the revolving credit facility may have been converted into Eurodollar-based advances at an annual percentage rate equal to LIBOR plus 2.75%. In connection with the execution of the Amended Credit Agreement, the Company issued warrants to the lenders to purchase an aggregate of 11,298 shares of common stock at an exercise price of $8.85 per share as more fully described in Note 4. One lender exercised its warrant to purchase 5,649 shares of common stock in September 2015, and the other lender exercised its warrant to purchase 5,649 shares of common stock in February 2016. As of September 30, 2016, no warrants remain outstanding. The Company accounted for the debt discount and deferred asset utilizing the effective interest method. There was no amortization of debt discount and the deferred asset to interest expense for the three months ended September 30, 2016 and 2015 and the nine months ended September 30, 2016. Amortization of debt discount and the deferred asset to interest expense amounted to $15,000 for the nine months ended September 30, 2015. The Company’s debt balances, including current portions, were as follows (in thousands): September 30, December 31, 2016 2015 Notes payable $ $ Total debt Less current portion of long-term debt Total long-term debt $ - $ In 2015, the Company entered into agreements with two international distributors pursuant to which their distribution rights with the Company were terminated effective as of December 31, 2015. As part of the agreements the distributors agreed to provide certain services to, and not compete with, the Company for one-to-two years in exchange for payments calculated based on single-digit percentages of the Company’s future revenues in those years in the countries that had comprised their territories. Management recorded the estimated fair value of the non-compete provisions as an intangible asset of approximately $0.3 million, which will be amortized on a straight-line basis to selling, general and administrative expense over the one-to-two year period. The following reflects the composition of intangible assets, net (in thousands): September 30, December 31, 2016 2015 GMP royalty buyout $ $ Non-compete agreements Accumulated amortization Total $ $ Weighted average amortization period (in months) In the three months ended September 30, 2016 and 2015 and the nine months ended September 30, 2016 and 2015, the Company recorded related amortization expense of $0.9 million, $0.9 million, $2.7 million and $2.6 million, respectively, in cost of sales. Estimated amortization expense will be $3.7 million in 2016, $3.6 million in 2017 and $3.0 million in 2018 .

Stock-Based Compensation

Stock-Based Compensation	9 Months Ended
	Sep. 30, 2016
Stock-Based Compensation.
Stock-Based Compensation	Note 6. Stock-Based Compensation The Company has four stock-based compensation plans (collectively, the Stock Plans)—the 2001 Stock Option Plan (the 2001 Stock Plan), the 2011 Stock Plan, the 2015 Omnibus Incentive Compensation Plan (the 2015 Stock Plan) and the 2015 Employee Stock Purchase Plan. Stock options granted pursuant to the 2001 Stock Plan and 2011 Stock Plan generally permit optionees to elect to exercise unvested options in exchange for restricted common stock. All unvested shares issued upon the early exercise of stock options, so long as they remain unvested, are subject to the Company’s right of repurchase at the optionee’s original exercise price for a 90-day period beginning on the date that an optionee’s service with the Company voluntarily or involuntarily terminates. Consistent with authoritative guidance, early exercises are not considered exercises for accounting purposes. Cash received for the exercise of unvested options is recorded as a liability, which liability is released to equity at each reporting date as the shares vest. During the three months ended September 30, 2016 and 2015 and the nine months ended September 30, 2016, there were no option exercises for unvested shares and during the nine months ended September 30, 2015, there were option exercises for 337 unvested shares. As of September 30, 2016 and December 31, 2015, 2,931 and 16,682 shares, respectively, remained subject to a repurchase right by the Company. As of September 30, 2016 and December 31, 2015, the related liability, which is included in other accrued liabilities in the accompanying condensed consolidated balance sheets, was approximately $13,000 and $67,000, respectively. The following table summarizes stock option activity under the 2001 Stock Plan, 2011 Stock Plan and 2015 Stock Plan (in thousands): Number of Shares Underlying Options Outstanding at December 31, 2015 Granted Exercised Canceled/forfeited/expired Outstanding at September 30, 2016 Exercisable at September 30, 2016 The following table summarizes the allocation of stock-based compensation in the accompanying condensed consolidated statements of operations (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Cost of sales $ $ $ $ Selling, general and administrative Research and development Total $ $ $ $ Stock-Based Awards to Employees The fair value of each option award is estimated on the date of grant using a Black-Scholes option valuation model applying the assumptions noted in the following table. The weighted average assumptions used to estimate the fair value of options granted to employees were as follows: Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Risk-free interest rate ** % % % Expected dividend yield ** % % % Expected volatility ** % % % Expected term (in years) **

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
	Sep. 30, 2016
Commitments and Contingencies
Commitments and Contingencies	Note 7. Commitments and Contingencies The Company, from time to time, is involved in legal proceedings or regulatory encounters or other matters in the ordinary course of business that could result in unasserted or asserted claims or litigation. Management is not aware of any legal proceedings where the likelihood of a loss contingency is reasonably possible and the amount or range of reasonably possible losses is material to the Company’s results of operations, financial condition or cash flows. Operating leases The Company leases its main headquarters and manufacturing facility and facilities for its foreign subsidiaries. Certain of the Company’s leases contain renewal options, rent escalation clauses, and/or landlord incentives. Rent expense for noncancelable operating leases with scheduled rent increases and/or landlord incentives is recognized on a straight-line basis over the lease term beginning with the lease commencement date, or the date the Company takes control of the leased space, whichever is sooner. The excess of straight-line rent expense over scheduled payment amounts and landlord incentives is recorded as a deferred rent liability. The Company leases a 37,700 square foot facility located in San Clemente, California under a sublease that was effective September 1, 2015, followed by a five-year lease for the facility that takes effect January 1, 2017 upon expiration of the sublease. This facility is the Company’s main headquarters and manufacturing facility. Rent under the direct lease begins on January 1, 2017 at approximately $42,000 per month, with rent for the second and third months abated, and the rent payments increase annually beginning on January 1, 2018 at percentages ranging from 2.5% to 3.5%. The direct lease agreement contains an option to extend the lease for up to two additional three-year periods at market rates. The direct lease landlord has agreed to provide the Company with a tenant improvement allowance on January 1, 2017 in the amount of the cost of any leasehold improvements, not to exceed approximately $264,000. Upon expiration of the Company’s prior main facility leases in Laguna Hills, California on September 30, 2016, Fjord Ventures, an entity controlled by Olav Bergheim (a former board member and founder of the Company), became the new tenant of such facilities. In order to continue certain manufacturing operations primarily for markets outside of the United States, the Company and Fjord Ventures entered into an agreement pursuant to which the Company is subleasing portions of such facilities from Fjord Ventures through March 31, 2017 for a total cost of $294,000. The Company’s foreign subsidiaries lease office space totaling less than 2,000 square feet. The Company recorded deferred rent of $216,000 and $149,000 as of September 30, 2016 and December 31, 2015, respectively, in conjunction with its facilities lease agreements. Rent expense was $0.5 million, $0.2 million, $0.8 million and $0.4 million for the three months ended September 30, 2016 and 2015 and the nine months ended September 30, 2016 and 2015, respectively. Future minimum payments under the aforementioned non-cancelable operating leases for each of the five succeeding years are as follows (in thousands): Remainder of 2016 $ 2017 2018 2019 2020 Thereafter $ Purchase Commitments The Company is a party to various purchase arrangements related to components used in production and research and development activities. As of September 30, 2016 and December 31, 2015, the Company had noncancelable, firm purchase commitments with certain vendors totaling approximately $3.6 million and $2.6 million, respectively, due within one year. There are no material purchase commitments due beyond one year. Regents of the University of California On December 30, 2014, the Company executed an agreement (the UC Agreement) with the Regents of the University of California (the University) to correct inventorship in connection with a group of the Company’s U.S. patents (the Patent Rights) and to obtain from the University a covenant that it did not and would not claim any right or title to the Patent Rights and will not challenge or assist any others in challenging the Patent Rights. In connection with the Agreement, Glaukos agreed to pay to the University the sum of $2.7 million via five payments during the course of 2015, and, beginning with sales on or after January 1, 2015, to pay a low single-digit percentage of worldwide net sales of certain current and future products, including the Company’s iStent products, with a required minimum annual payment of $500,000. This ongoing product payment terminates on the date that the last of the Patent Rights expires, which is currently expected to be in 2022. In the three months ended September 30, 2016 and 2015 and the nine months ended September 30, 2016 and 2015, the Company recorded approximately $0.7 million, $0.5 million, $2.0 million and $1.3 million, respectively, in cost of sales in connection with this product payment obligation. The $2.7 million obligation, net of imputed interest of $0.1 million, was accrued as of December 31, 2014 and charged to cost of sales in the year ended December 31, 2014. Under the terms of the UC Agreement, the payments comprising the $2.7 million obligation were due within 60 days of the IPO, and, accordingly, the Company paid the remaining balance due of $1.8 million prior to August 29, 2015.

Variable Interest Entity

Variable Interest Entity	9 Months Ended
	Sep. 30, 2016
Variable Interest Entity
Variable Interest Entity	Note 8. Variable Interest Entity In October 2009, the Company formed a wholly-owned subsidiary, DOSE Medical Corporation and in April 2010, the Company distributed all of its shares of common stock of DOSE via a stock dividend to the Company’s stockholders of record as of the close of business on March 31, 2010. Since its formation, the Company had provided DOSE with a small number of leased employees, management services and space, all of which had been charged to DOSE and pursuant to written agreements between the parties. Additionally, the Company had provided DOSE the cash required to fund its operations that, together with accrued interest and charges for the aforementioned services, the Company had recorded in an intercompany receivable account. Up until the transaction on June 30, 2015 described below, the Company had accounted for DOSE as a variable interest entity in which it had a variable interest in all reporting periods since the formation of DOSE. Accordingly, the Company’s condensed consolidated financial statements include the accounts of DOSE, with all intercompany balances eliminated and with the deficit balance of DOSE's net assets reflected as noncontrolling interest, up to but excluding June 30, 2015. On June 30, 2015, the Company completed a transaction initially executed in July 2014, the closing of which was contingent upon the successful completion of an IPO. Pursuant to the terms of the asset purchase agreement, the Company acquired from DOSE certain assets, including the iDose product line, in exchange for payment of $15.0 million in cash and the elimination of the $10.9 million intercompany receivable owed by DOSE to the Company as of the closing date. In addition to the asset purchase agreement, the parties agreed to an amended and restated patent license agreement and an amended and restated transition services agreement that provides for limited support from the Company to DOSE for a period of up to three years. Either party can terminate the transition services agreement upon adequate written notice. Two members of the Company’s board of directors currently serve on the board of directors of DOSE. Upon the close of the transaction, the Company reconsidered its relationship with DOSE and determined that the Company was no longer the primary beneficiary with the power to direct operations and the right to receive benefits/absorb losses of DOSE; therefore, upon the close of the transaction, the Company derecognized DOSE and no longer considers it a consolidated entity in its financial statements. Accordingly, in the three months ended June 30, 2015, the Company recorded a charge to other expense in the amount of $25.7 million to reflect the deconsolidation of DOSE’s non-glaucoma related assets and noncontrolling interest. Consolidation of DOSE’s results of operations included the following (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Selling, general and administrative $ - $ - $ - $ Research and development - - - Interest expense - - - Income tax provision - - - - Net loss of DOSE $ - $ - $ - $ Consolidation of DOSE’s cash flows included the following (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Cash used in operating activities $ - $ - $ - $ Cash used in investing activities - - - Cash provided by financing activities - - - Decrease in cash and cash equivalents of DOSE $ - $ - $ - $

Business Segment Information

Business Segment Information	9 Months Ended
	Sep. 30, 2016
Segment Information
Business Segment Information	Note 9. Business Segment Information Operating segments are identified as components of an enterprise about which segment discrete financial information is available for evaluation by the chief operating decision-maker in making decisions regarding resource allocation and assessing performance. The Company operates its business on the basis of one reportable segment—ophthalmic medical devices. Three months ended Nine months ended September 30, September 30, Geographic Net Sales Information (in thousands) 2016 2015 2016 2015 United States $ $ $ $ International Total net sales $ $ $ $

Summary of Significant Accoun17

Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2016
Summary of Significant Accounting Policies
Use of Estimates	Use of estimates The preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts in the financial statements and accompanying notes. Actual results could differ materially from those estimates and assumptions. Management considers many factors in selecting appropriate financial accounting policies and controls and in developing the estimates and assumptions that are used in the preparation of these financial statements. Management must apply significant judgment in this process. In addition, other factors may affect estimates, including expected business and operational changes, sensitivity and volatility associated with the assumptions used in developing estimates, and whether historical trends are expected to be representative of future trends. The estimation process often may yield a range of potentially reasonable estimates of the ultimate future outcomes, and management must select an amount that falls within that range of reasonable estimates. The most significant estimates in the accompanying condensed consolidated financial statements relate to revenue recognition, inventory reserves and stock‑based compensation expense. Although these estimates are based on the Company’s knowledge of current events and actions it may undertake in the future, this process may result in actual results differing materially from those estimated amounts used in the preparation of the financial statements .
Foreign Currency Translation	Foreign currency translation The accompanying condensed consolidated financial statements are presented in U.S. dollars. The Company considers the local currency to be the functional currency for its international subsidiaries. Accordingly, their assets and liabilities are translated into U.S. dollars using the exchange rate in effect on the balance sheet date. Revenues and expenses are translated at average exchange rates prevailing throughout the periods presented. Currency translation adjustments arising from period to period are charged or credited to accumulated other comprehensive (loss) income in stockholders’ equity. For the three months ended September 30, 2016 and 2015 and the nine months ended September 30, 2016 and 2015, the Company reported (losses) gains from foreign currency translation adjustments of approximately $(16,000), $12,000, $(450,000) and $51,000, respectively. Realized gains and losses resulting from foreign currency transactions are included in selling, general and administrative expense in the condensed consolidated statements of operations. For the three months ended September 30, 2016 and 2015 and the nine months ended September 30, 2016 and 2015, the Company reported foreign currency transaction gains (losses) of $51,000, $(13,000), $73,000 and $(98,000).
Cash, Cash Equivalents and Short-Term Investments	Cash, cash equivalents and short-term investments The Company invests its excess cash in marketable securities, including money market funds, asset-backed securities, bank certificates of deposit, corporate bonds, and corporate commercial paper, U.S. government bonds and U.S. government agency bonds. For financial reporting purposes, liquid investment instruments purchased with an original maturity of three months or less are considered to be cash equivalents. Cash and cash equivalents are recorded at face value or cost, which approximates fair market value. From time to time, the Company maintains cash balances in excess of amounts insured by the Federal Deposit Insurance Commission. Investments are stated at fair value as determined by quoted market prices. Investments are considered available-for-sale and, accordingly, unrealized gains and losses are included in accumulated other comprehensive (loss) income within stockholders’ equity. The Company’s entire investment portfolio, except for restricted cash, is considered to be available for use in current operations and, accordingly, all such investments are stated at fair value using quoted market prices and classified as current assets, although the stated maturity of individual investments may be one year or more beyond the balance sheet date. The Company did not have any trading securities or restricted investments at September 30, 2016 and December 31, 2015. Realized gains and losses and declines in value, if any, judged to be other-than-temporary on available-for-sale securities, are reported in interest income or expense, net. When securities are sold, any associated unrealized gain or loss previously reported as a separate component of stockholders’ equity is reclassified out of stockholders’ equity and recorded in the statements of operations in the period sold. Accrued interest and dividends are included in interest income. The Company periodically reviews its available-for-sale securities for other-than-temporary declines in fair value below the cost basis, and whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company has a credit card facility with its primary operating bank which is collateralized by certificates of deposit maintained at the bank.
Fair Value Measurements	Fair value measurements Assets and liabilities are measured using quoted prices in active markets and total fair value is the published market price per unit multiplied by the number of units held without consideration of transaction costs. Assets and liabilities that are measured using significant other observable inputs are valued by reference to similar assets or liabilities, adjusted for contract restrictions and other terms specific to that asset or liability. For these items, a significant portion of fair value is derived by reference to quoted prices of similar assets or liabilities in active markets. For all remaining assets and liabilities, fair value is derived using a fair value model, such as a discounted cash flow model or Black-Scholes model.
Fair Value of Financial Instruments	Fair value of financial instruments The carrying amounts of cash equivalents, accounts receivable, accounts payable, and accrued liabilities are considered to be representative of their respective fair values because of the short-term nature of those instruments. Based on the borrowing rates for loans currently available to the Company for loans with similar terms, the Company believes that the fair value of long-term debt approximates its carrying value. The carrying amount of the warrant liability and non-controlling interest represent their fair values. The valuation of assets and liabilities are subject to fair value measurements using a three-tiered approach and fair value measurements are classified and disclosed by the Company in one of the following three categories: Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; Level 2: Quoted prices for similar assets and liabilities in active markets, quoted prices in markets that are not active, or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability; and Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity).
Revenue Recognition	Revenue recognition The Company recognizes revenue from product sales when the following criteria are met: goods are shipped, title and risk of loss has transferred to its customers, persuasive evidence of an arrangement exists and collectability is reasonably assured. Persuasive evidence of an arrangement exists when there is a contractual arrangement in place with the customer. Delivery has occurred when a product is shipped. If persuasive evidence of an arrangement exists and delivery has occurred, the Company determines whether the invoiced amount is fixed or determinable and collectability of the invoiced amount is reasonably assured. The Company assesses whether the invoiced amount is fixed or determinable based on the existing arrangement with the customer, including whether the Company has sufficient history with a customer to reliably estimate the customer’s payment patterns. The Company assesses collectability by evaluating historical cash receipts and individual customer outstanding balances. To the extent all criteria set forth above are not satisfied at the time of shipment, revenue is recognized when cash is received from the customer. Customers are not granted specific rights of return; however, the Company may permit returns of product from customers if such product is returned in a timely manner and in good condition. The Company provides a warranty on its products for one year from the date of shipment, and any product found to be defective or out of specification will be replaced at no charge during the warranty period. Estimated allowances for sales returns and warranty replacements are recorded at the time of sale of the product and are estimated based upon the historical patterns of product returns matched against sales, and an evaluation of specific factors that may increase the risk of product returns. Product returns and warranty replacements to date have been consistent with amounts reserved or accrued and have not been significant.
Research and Development Expenses	Research and development expenses Major components of research and development expense include personnel costs, preclinical studies, clinical trials and related clinical product manufacturing, materials and supplies, and fees paid to consultants. Research and development costs are expensed as goods are received or services are rendered. Costs to acquire technologies to be used in research and development that have not reached technological feasibility and have no alternative future use are also expensed as incurred. At each financial reporting date, the Company accrues the estimated costs of clinical study activities performed by third party clinical sites with whom the Company has agreements providing for fees based upon the quantities of subjects enrolled and clinical evaluation visits that occur over the life of the study. The cost estimates are determined based upon a review of the agreements and data collected by internal and external clinical personnel as to the status of enrollment and subject visits, and are based upon the facts and circumstances known to the Company at each financial reporting date. If the actual performance of activities varies from the assumptions used in the cost estimates, the accruals are adjusted accordingly. There have been no material adjustments to the Company’s prior period accrued estimates for clinical trial activities through September 30, 2016.
Stock-Based Compensation	Stock-based compensation The Company recognizes compensation expense for all stock-based awards granted to employees and nonemployees, including members of its Board of Directors. The fair value of stock-based awards made to employees is estimated at the grant date using the Black-Scholes option pricing model, and the portion that is ultimately expected to vest is recognized as compensation cost over the requisite service period using the straight-line method. The determination of the fair value-based measurement of stock options on the date of grant using an option pricing model is affected by the determination of the fair value of the underlying stock as well as assumptions regarding a number of highly complex and subjective variables. These variables include, but are not limited to, the Company’s stock price volatility over the expected term of the grants, and actual and projected employee stock option exercise behaviors. In the future, as additional empirical evidence regarding these estimates becomes available, the Company may change or refine its approach of deriving them, and these changes could impact the fair value-based measurement of stock options granted in the future. Changes in the fair value-based measurement of stock awards could materially impact the Company’s operating results. The fair values of stock-based awards made to nonemployees are remeasured at each reporting period using the Black-Scholes option pricing model. Compensation expense for these stock-based awards is determined by applying the remeasured fair values to the shares that have vested during a period.
Net Income (Loss) Per Share	Net income (loss) per share Basic net income (loss) per share is calculated by dividing the net income (loss) by the weighted average number of common shares that were outstanding for the period, without consideration for common stock equivalents. Diluted net income (loss) per share is calculated by dividing the net income by the sum of the weighted average number of dilutive common share equivalents outstanding for the period determined using the treasury stock method. Common stock equivalents are comprised of stock options and warrants outstanding. Diluted net loss per share is calculated by dividing the net loss by the weighted average number of common shares that were outstanding for the period, without consideration for common stock equivalents, as their inclusion would be anti-dilutive . The Company’s computation of net income (loss) per share is as follows (in thousands, except per share amounts): Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Numerator: Net income (loss) attributable to Glaukos Corporation - basic $ $ (2,057) $ $ (34,951) Adjustment for revaluation of warrants - (31) - - Net income (loss) attributable to Glaukos Corporation - diluted $ $ $ $ Denominator: Weighted average number of common shares outstanding - basic Common stock equivalents from outstanding common stock options - - Common stock equivalents from outstanding common stock warrants - - Common stock equivalents for ESPP - - Weighted average number of common shares outstanding - diluted Basic net income (loss) per share attributable to Glaukos Corporation common stockholders $ $ $ $ Diluted net income (loss) per share attributable to Glaukos Corporation common stockholders $ $ $ $ Potentially dilutive securities not included in the calculation of diluted net loss per share attributable to common stockholders because to do so would be anti-dilutive were as follows (in common stock equivalent shares, in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Stock options outstanding ESPP - - - Common stock warrants outstanding - -
Recent Accounting Pronouncements	Recent accounting pronouncements In May 2014, the Financial Accounting Standards Board (FASB) issued guidance in Accounting Standards Update (ASU) 2014-09 which was codified in Accounting Standard Codification ASC 606, Revenue Recognition — Revenue from Contracts with Customers , which amends the guidance in former ASC 605, Revenue Recognition , which provides a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and will supersede most current revenue recognition guidance. This ASU is based on the principle that revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The ASU also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. In August 2015, the FASB issued ASU 2015-14, which deferred the effective date to annual reporting periods beginning after December 15, 2017 (including interim periods within those periods). Early adoption is permitted to the original effective date of December 15, 2016 (including interim periods within those periods). The Company is currently evaluating the impact of the provisions of ASC 606 on its consolidated financial statements. In July 2015, the FASB issued ASU 2015-11, Inventory (Topic 330), Simplifying the Measurement of Inventory , which changes the measurement principle for inventory from the lower of cost or market to the lower of cost and net realizable value. ASU 2015-11 defines net realizable value as estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The new guidance became effective for the Company on January 1, 2016 and the adoption had no impact on its consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). The ASU requires management to recognize on the balance sheet lease assets and lease liabilities by lessees for all operating leases. The ASU is effective for periods ending on December 15, 2018 and interim periods therein on a modified retrospective basis. The Company is currently evaluating the impact adoption of this guidance will have on its consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09, Compensation - Stock Compensation (Topic 718), Improvements to Employee Share-Based Payment Accounting . The standard is intended to simplify several areas of accounting for share-based compensation arrangements, including the income tax impact, classification on the statement of cash flows and forfeitures. ASU 2016-09 is effective for fiscal years, and interim periods within those years, beginning after December 15, 2016, and early adoption is permitted. The Company is currently evaluating the impact this guidance will have on its consolidated financial statements. In April 2016, the FASB issued ASU No. 2016-10 Revenue from Contracts with Customers (Topic 606), Identifying Performance Obligations and Licensing . ASU 2016-10 clarifies the following two aspects of Topic 606: identifying performance obligations and the licensing implementation guidance, while retaining the related principles for those areas. ASU 2016-10 is effective for public business entities for annual periods, including interim periods within those annual periods, beginning after December 15, 2017, with early application permitted. The Company is currently evaluating the impact this guidance will have on its consolidated financial statements.

Summary of Significant Accoun18

Summary of Significant Accounting Policies (Tables)	9 Months Ended
	Sep. 30, 2016
Summary of Significant Accounting Policies
Schedule of the Company's net income (loss) per share	The Company’s computation of net income (loss) per share is as follows (in thousands, except per share amounts): Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Numerator: Net income (loss) attributable to Glaukos Corporation - basic $ $ (2,057) $ $ (34,951) Adjustment for revaluation of warrants - (31) - - Net income (loss) attributable to Glaukos Corporation - diluted $ $ $ $ Denominator: Weighted average number of common shares outstanding - basic Common stock equivalents from outstanding common stock options - - Common stock equivalents from outstanding common stock warrants - - Common stock equivalents for ESPP - - Weighted average number of common shares outstanding - diluted Basic net income (loss) per share attributable to Glaukos Corporation common stockholders $ $ $ $ Diluted net income (loss) per share attributable to Glaukos Corporation common stockholders $ $ $ $
Schedule of potentially dilutive securities not included in the calculation of diluted net loss per share attributable to common stockholders	Potentially dilutive securities not included in the calculation of diluted net loss per share attributable to common stockholders because to do so would be anti-dilutive were as follows (in common stock equivalent shares, in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Stock options outstanding ESPP - - - Common stock warrants outstanding - -

Balance Sheet Details (Tables)

Balance Sheet Details (Tables)	9 Months Ended
	Sep. 30, 2016
Balance Sheet Details
Schedule of short-term investments	Short-term investments consisted of the following (in thousands): At September 30, 2016 Maturity Amortized cost Unrealized Unrealized Estimated (in years) or cost gains losses fair value U.S. government bonds 1-3 $ $ $ $ U.S. government agency bonds less than 3 - Bank certificates of deposit less than 2 Commercial paper less than 1 Corporate notes less than 3 Asset-backed securities less than 2 - Total $ $ $ $ At December 31, 2015 Maturity Amortized cost Unrealized Unrealized Estimated (in years) or cost gains losses fair value U.S. government agency bonds 1-3 $ $ - $ $ Commercial paper less than 1 - Corporate notes 1-3 - Asset-backed securities 1-3 - Total $ $ - $ $
Schedule of accounts receivable, net	Accounts receivable consisted of the following (in thousands): September 30, December 31, 2016 2015 Accounts receivable $ $ Less allowance for doubtful accounts $ $
Schedule of inventory	Inventory consisted of the following (in thousands): September 30, December 31, 2016 2015 Finished goods $ $ Work in process Raw material $ $
Schedule of accrued liabilities	Accrued liabilities consisted of the following (in thousands): September 30, December 31, 2016 2015 Accrued bonuses and sales commissions $ $ Accrued vacation benefits Accrued clinical study payments Other accrued liabilities $ $

Fair Value Measurements (Tables

Fair Value Measurements (Tables)	9 Months Ended
	Sep. 30, 2016
Fair Value Measurements
Schedule of the Company's financial assets and financial liabilities measured at fair value on a recurring basis	The following tables present information about the Company's financial assets and financial liabilities measured at fair value on a recurring basis as of September 30, 2016 and December 31, 2015, and indicate the fair value hierarchy of the valuation techniques utilized by the Company to determine such fair value (in thousands): At September 30, 2016 September 30, Quoted prices active Significant Significant 2016 (Level 1) (Level 2) (Level 3) Assets Money market funds (i) $ $ $ - $ - U.S. government bonds - - U.S. government agency bonds - - Bank certificates of deposit - - Commercial paper (ii) - - Corporate notes - - Asset-backed securities - - Total assets $ $ $ $ - Liabilities Stock warrant liability $ - $ - $ - $ - Total liabilities $ - $ - $ - $ - At December 31, 2015 December 31, Quoted prices active Significant Significant 2015 (Level 1) (Level 2) (Level 3) Assets Money market funds (i) $ $ $ - $ - U.S. government agency bonds - - Commercial paper (ii) - - Corporate notes (ii) - - Asset-backed securities (ii) - - Total assets $ $ $ $ - Liabilities Stock warrant liability $ $ - $ - $ Total liabilities $ $ - $ - $ (i) Included in cash and cash equivalents with a maturity of three months or less from date of purchase on the condensed consolidated balance sheets. (ii) Included in cash and cash equivalents or short-term investments on the condensed consolidated balance sheets.
Reconciliation of liabilities measured at fair value using level 3 significant unobservable inputs (Level 3) on a recurring basis	The following table provides a reconciliation of liabilities measured at fair value using Level 3 significant unobservable inputs on a recurring basis (in thousands): Warrant Balance at December 31, 2015 $ Change in the fair value of stock warrants Issuance of common stock in connection with exercise of common stock warrant Balance at September 30, 2016 $ -

Long-Term Debt (Tables)

Long-Term Debt (Tables)	9 Months Ended
	Sep. 30, 2016
Long-Term Debt.
Schedule of the Company’s debt balances	The Company’s debt balances, including current portions, were as follows (in thousands): September 30, December 31, 2016 2015 Notes payable $ $ Total debt Less current portion of long-term debt Total long-term debt $ - $
Schedule reflecting the composition of intangible assets, net	The following reflects the composition of intangible assets, net (in thousands): September 30, December 31, 2016 2015 GMP royalty buyout $ $ Non-compete agreements Accumulated amortization Total $ $ Weighted average amortization period (in months)

Stock-Based Compensation (Table

Stock-Based Compensation (Tables)	9 Months Ended
	Sep. 30, 2016
Stock-Based Compensation.
Schedule summarizing stock option activity under the 2001 Stock Plan, 2011 Stock Plan and 2015 Stock Plan	The following table summarizes stock option activity under the 2001 Stock Plan, 2011 Stock Plan and 2015 Stock Plan (in thousands): Number of Shares Underlying Options Outstanding at December 31, 2015 Granted Exercised Canceled/forfeited/expired Outstanding at September 30, 2016 Exercisable at September 30, 2016
Schedule summarizing the allocation of stock-based compensation	The following table summarizes the allocation of stock-based compensation in the accompanying condensed consolidated statements of operations (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Cost of sales $ $ $ $ Selling, general and administrative Research and development Total $ $ $ $
Schedule of the weighted-average assumptions used to estimate the fair value of options granted to employees	Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Risk-free interest rate ** % % % Expected dividend yield ** % % % Expected volatility ** % % % Expected term (in years) **

Commitments and Contingencies (

Commitments and Contingencies (Tables)	9 Months Ended
	Sep. 30, 2016
Commitments and Contingencies
Schedule of future minimum lease payments under noncancelable operating leases	Future minimum payments under the aforementioned non-cancelable operating leases for each of the five succeeding years are as follows (in thousands): Remainder of 2016 $ 2017 2018 2019 2020 Thereafter $

Variable Interest Entity (Table

Variable Interest Entity (Tables)	9 Months Ended
	Sep. 30, 2016
Variable Interest Entity
Schedule of DOSE's financial information included in the accompanying financial statements:	Consolidation of DOSE’s results of operations included the following (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Selling, general and administrative $ - $ - $ - $ Research and development - - - Interest expense - - - Income tax provision - - - - Net loss of DOSE $ - $ - $ - $ Consolidation of DOSE’s cash flows included the following (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2016 2015 2016 2015 Cash used in operating activities $ - $ - $ - $ Cash used in investing activities - - - Cash provided by financing activities - - - Decrease in cash and cash equivalents of DOSE $ - $ - $ - $

Business Segment Information (T

Business Segment Information (Tables)	9 Months Ended
	Sep. 30, 2016
Segment Information
Schedule of Geographic Net Sales Information	Three months ended Nine months ended September 30, September 30, Geographic Net Sales Information (in thousands) 2016 2015 2016 2015 United States $ $ $ $ International Total net sales $ $ $ $

Organization and Basis of Pre26

Organization and Basis of Presentation - IPO (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	Jun. 30, 2015	Sep. 30, 2015
Organization and Basis of Presentation
Proceeds from public offering, net of issuance costs		$ 113,589
Warrants to Purchase Shares of Series D Convertible Preferred Stock
Organization and Basis of Presentation
Warrants outstanding (in shares)	0
Convertible Preferred Stock
Organization and Basis of Presentation
Common shares issued upon the conversion of convertible preferred stock (in shares)	21,700
Shares outstanding	0
Common Stock | IPO
Organization and Basis of Presentation
Issuance of common stock in initial public offering (in shares)	6,900
Share price (in dollars per share)	$ 18
Proceeds from public offering, net of issuance costs	$ 113,600
Underwriting commissions	8,700
Stock issuance costs	$ 1,900
Omnibus Incentive Compensation Plan 2015
Organization and Basis of Presentation
Shares reserved for future issuance	4,500
Employee Stock Purchase Plan 2015
Organization and Basis of Presentation
Shares reserved for future issuance	450

Organization and Basis of Pre27

Organization and Basis of Presentation - DOSE Medical (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Sep. 30, 2015
Acquisition of certain DOSE Medical Corporation Assets
Cash payments for the acquisition of certain assets of related party		$ 15,000
DOSE Medical Corporation
Acquisition of certain DOSE Medical Corporation Assets
Cash payments for the acquisition of certain assets of related party	$ 15,000
Maximum period of support under transition services agreement	3 years

Summary of Significant Accoun28

Summary of Significant Accounting Policies - Summary (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Foreign Currency Translation
(Loss) gain from foreign currency translation adjustments	$ (16)	$ 12	$ (450)	$ 51
Foreign currency transaction gain (loss)	51	(13)	73	(98)
Numerator:
Net income (loss) attributable to Glaukos Corporation - basic	1,159	(2,057)	4,388	(34,951)
Adjustment for revaluation of warrants		(31)
Net income (loss) attributable to Glaukos Corporation - diluted	$ 1,159	$ (2,088)	$ 4,388	$ (34,951)
Denominator:
Weighted average number of common shares oustanding - basic	33,116	32,006	32,691	12,551
Common stock equivalents from outstanding common stock options	3,886		3,555
Common stock equivalents from outstanding common stock warrants		7	1
Common stock equivalents for ESPP	21		12
Weighted average number of common shares oustanding - diluted	37,023	32,013	36,259	12,551
Basic net income (loss) per share attributable to Glaukos Corporation stockholders	$ 0.03	$ (0.06)	$ 0.13	$ (2.78)
Diluted net income (loss) per share attributable to Glaukos Corporation stockholders	$ 0.03	$ (0.07)	$ 0.12	$ (2.78)

Summary of Significant Accoun29

Summary of Significant Accounting Policies - Antidilutive Securities (Details) - shares shares in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Anti-dilutive securities
Anti-dilutive securities excluded from computation of earnings per share	631	5,598	2,201	5,598
Stock options
Anti-dilutive securities
Anti-dilutive securities excluded from computation of earnings per share	631	5,592	2,131	5,592
ESPP
Anti-dilutive securities
Anti-dilutive securities excluded from computation of earnings per share			70
Common Stock Warrants
Anti-dilutive securities
Anti-dilutive securities excluded from computation of earnings per share		6		6

Balance Sheet Details - Short-T

Balance Sheet Details - Short-Term Investments (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Short-term investments
Amortized cost	$ 88,516	$ 69,700
Unrealized gains	116
Unrealized losses	(17)	(148)
Estimated fair value	88,615	69,552
U.S.government bonds
Short-term investments
Amortized cost	1,497
Unrealized gains	2
Unrealized losses	(1)
Estimated fair value	$ 1,498
U.S.government bonds | Minimum
Short-term investments
Maturity	1 year
U.S.government bonds | Maximum
Short-term investments
Maturity	3 years
U.S Government agency bonds
Short-term investments
Amortized cost	$ 7,259	5,513
Unrealized gains	14
Unrealized losses		(10)
Estimated fair value	$ 7,273	$ 5,503
U.S Government agency bonds | Minimum
Short-term investments
Maturity		1 year
U.S Government agency bonds | Maximum
Short-term investments
Maturity	3 years	3 years
Bank certificates of deposit
Short-term investments
Amortized cost	$ 12,250
Unrealized gains	8
Unrealized losses	(3)
Estimated fair value	$ 12,255
Bank certificates of deposit | Maximum
Short-term investments
Maturity	2 years
Commercial paper
Short-term investments
Amortized cost	$ 14,593	$ 12,342
Unrealized gains	4
Unrealized losses	(3)	(2)
Estimated fair value	$ 14,594	$ 12,340
Commercial paper | Maximum
Short-term investments
Maturity	1 year	1 year
Corporate notes
Short-term investments
Amortized cost	$ 46,286	$ 45,051
Unrealized gains	65
Unrealized losses	(10)	(110)
Estimated fair value	$ 46,341	$ 44,941
Corporate notes | Minimum
Short-term investments
Maturity		1 year
Corporate notes | Maximum
Short-term investments
Maturity	3 years	3 years
Asset-backed securities
Short-term investments
Amortized cost	$ 6,631	$ 6,794
Unrealized gains	23
Unrealized losses		(26)
Estimated fair value	$ 6,654	$ 6,768
Asset-backed securities | Minimum
Short-term investments
Maturity		1 year
Asset-backed securities | Maximum
Short-term investments
Maturity	2 years	3 years

Balance Sheet Details - Other (

Balance Sheet Details - Other (Details) - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Accounts Receivable, Net
Accounts receivable	$ 12,009	$ 7,632
Less allowance for doubtful accounts	(262)	(83)
Accounts receivable, net	11,747	7,549
Inventory
Finished goods	2,742	953
Work in process	358	503
Raw materials	3,353	2,641
Total inventory	6,453	4,097
Accrued Liabilities
Accrued bonuses and sales commissions	4,786	4,057
Accrued vacation benefits	1,288	1,007
Accrued clinical study expenses	1,078	654
Other accrued liabilities	3,896	2,075
Total accrued liabilities	$ 11,048	$ 7,793

Fair Value Measurements - Fair

Fair Value Measurements - Fair Value Hierarchy (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands	Sep. 30, 2016	Dec. 31, 2015
Assets
Total assets	$ 89,264	$ 86,719
Liabilities
Stock warrant liability		105
Total liabilities		105
Fair Value, Inputs, Level 1
Assets
Total assets	149	13,922
Fair Value, Inputs, Level 2
Assets
Total assets	89,115	72,797
Fair Value, Inputs, Level 3
Liabilities
Stock warrant liability		105
Total liabilities		105
Money market funds
Assets
Total assets	149	13,922
Money market funds | Fair Value, Inputs, Level 1
Assets
Total assets	149	13,922
U.S.government bonds
Assets
Total assets	1,498
U.S.government bonds | Fair Value, Inputs, Level 2
Assets
Total assets	1,498
U.S Government agency bonds
Assets
Total assets	7,273	5,523
U.S Government agency bonds | Fair Value, Inputs, Level 2
Assets
Total assets	7,273	5,523
Bank certificates of deposit
Assets
Total assets	12,255
Bank certificates of deposit | Fair Value, Inputs, Level 2
Assets
Total assets	12,255
Commercial paper.
Assets
Total assets	15,094	15,340
Commercial paper. | Fair Value, Inputs, Level 2
Assets
Total assets	15,094	15,340
Corporate notes
Assets
Total assets	46,341	45,159
Corporate notes | Fair Value, Inputs, Level 2
Assets
Total assets	46,341	45,159
Asset-backed securities
Assets
Total assets	6,654	6,775
Asset-backed securities | Fair Value, Inputs, Level 2
Assets
Total assets	$ 6,654	$ 6,775

Fair Value Measurements - Warra

Fair Value Measurements - Warrants and other (Details) - USD ($)	1 Months Ended			3 Months Ended	9 Months Ended		12 Months Ended
	Feb. 29, 2016	Sep. 30, 2015	Feb. 28, 2015	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015
Fair Value Measurements, Valuation
Change in fair value of stock warrant liability				$ 31,000	$ 43,000	$ (1,130,000)
Amount of transfers of assets and liabilities measured on a recurring basis between Levels 1, 2 and 3 of the fair value hierarchy					0		$ 0
Common Stock Warrants | Amended Agreement
Fair Value Measurements, Valuation
Shares that may be purchased under warrant (in shares)			11,298				5,649
Exercise price of warrants (in dollars per share)			$ 8.85
Stock warrant liabilities, fair value			$ 53,000				$ 100,000
Warrants exercised (in shares)	5,649	5,649
Change in fair value of stock warrant liability				$ 31,000	$ 43,000	$ (1,100,000)
Fair Value Assumptions
Risk free interest rate (as a percent)			1.90%				1.90%
Dividend yield (as a percent)			0.00%				0.00%
Expected volatility rate (as a percent)			70.00%				54.80%
Expected life			7 years				6 years 2 months 12 days

Fair Value Measurements - Level

Fair Value Measurements - Level 3 (Details) - Stock Warrant Liability $ in Thousands	9 Months Ended
	Sep. 30, 2016USD ($)
Reconciliation of liabilities measured at fair value using level 3 significant unobservable inputs (Level 3) on a recurring basis
Beginning balance	$ 105
Change in the fair value of stock warrants	(43)
Common Stock
Reconciliation of liabilities measured at fair value using level 3 significant unobservable inputs (Level 3) on a recurring basis
Issuance of Shares in connection with the settlements	$ (62)

Long-term Debt - Notes Payable

Long-term Debt - Notes Payable (Details)	1 Months Ended		9 Months Ended	12 Months Ended		14 Months Ended
	Nov. 30, 2013USD ($)item	Dec. 31, 2012	Sep. 30, 2016	Dec. 31, 2015	Dec. 31, 2012USD ($)	Dec. 31, 2014USD ($)
GMP royalty buyout
Other disclosures
Useful life/amortization period			60 months	60 months
Buy-out Agreement with GMP
Other disclosures
Buy-out option period		90 days
Maximum payment allowed under the agreement in the event of a sale of the Company meeting certain criteria	$ 2,000,000
Buy-out Agreement with GMP | GMP royalty buyout
Other disclosures
Intangible asset purchase amount	$ 17,500,000
Useful life/amortization period	5 years
Buy-out Agreement with GMP | Cost of sales
Other disclosures
Amount paid to buy-out all remaining royalties payable to GMP					$ 1,000,000
GMP Note Parties | Buy-out Agreement with GMP
Other disclosures
Face amount at time of issuance	$ 17,500,000
Notes Payable | GMP Note Parties
Other disclosures
Monthly interest only payments						$ 72,900
Notes Payable | GMP Note Parties | November 30, 2013 to December 31, 2014
Other disclosures
Number of periodic payments of principal and interest | item	24
Monthly principal and interest payments	$ 767,700
Notes Payable | GMP Note Parties | Buy-out Agreement with GMP
Other disclosures
Interest rate (as a percent)	5.00%

Long-term Debt - Bank Loan Faci

Long-term Debt - Bank Loan Facility (Details) - USD ($) $ / shares in Units, $ in Thousands	Jul. 31, 2015	Feb. 29, 2016	Sep. 30, 2015	Feb. 28, 2015	Jun. 30, 2013	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015
Long-Term Debt
Loss on extinguishment of debt							$ 195		$ 195
Agreement | Line of credit
Long-Term Debt
Maximum borrowing capacity					$ 6,000
Line of credit, advances, threshold amount					$ 6,000
Line of credit, advances, threshold amount expressed as a percentage of the sum of cash, cash equivalents and eligible accounts receivable					77.00%
Interest rate at period end										3.75%
Amount outstanding				$ 2,100
Agreement | Line of credit | Prime Rate
Long-Term Debt
Basis spread					0.50%
Amended Agreement
Long-Term Debt
Repayments of debt	$ 7,000
Loss on extinguishment of debt	200
Amortization of debt discount and deferred asset to interest expense						$ 0	$ 0	$ 0	$ 15
Amended Agreement | Senior Secured Term Loan and Senior Secured Draw to Term Loan | Prime Rate
Long-Term Debt
Basis spread				2.00%
Amended Agreement | Senior Secured Term Loan and Senior Secured Draw to Term Loan | Eurodollar-based Advances | LIBOR
Long-Term Debt
Basis spread				3.00%
Amended Agreement | Senior Secured Term Loan
Long-Term Debt
Face amount at time of issuance				$ 5,000
Proceeds from issuance of debt				5,000
Amended Agreement | Senior Secured Draw-to-term Loan
Long-Term Debt
Face amount at time of issuance				5,000
Gross long-term debt	$ 2,000
Amended Agreement | Senior Secured Revolving Credit Facility
Long-Term Debt
Face amount at time of issuance				$ 8,000
Amended Agreement | Senior Secured Revolving Credit Facility | Prime Rate
Long-Term Debt
Basis spread				1.75%
Amended Agreement | Senior Secured Revolving Credit Facility | Eurodollar-based Advances
Long-Term Debt
Basis spread				2.75%
Common Stock Warrants | Amended Agreement
Long-Term Debt
Shares that may be purchased under warrant (in shares)				11,298						5,649
Exercise price of warrants (in dollars per share)				$ 8.85
Warrants exercised (in shares)		5,649	5,649
Warrants outstanding (in shares)						0		0

Long-term Debt - Summary and Ot

Long-term Debt - Summary and Other (Details) - USD ($)	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015
Debt balances, including current portions:
Total debt	$ 3,039,000		$ 3,039,000		$ 9,696,000
Less current portion of long-term debt	(3,039,000)		(3,039,000)		(8,931,000)
Total long-term debt					765,000
Composition of intangible assets
Total gross amount	17,743,000		17,743,000		17,743,000
Accumulated amortization	(10,264,000)		(10,264,000)		(7,525,000)
Total	7,479,000		7,479,000		10,218,000
Amortization expense	900,000	$ 900,000	2,700,000	$ 2,600,000
Estimated amortization expense
2,016	3,700,000		3,700,000
2,017	3,600,000		3,600,000
2,018	3,000,000		3,000,000
GMP royalty buyout
Composition of intangible assets
Total gross amount	17,500,000		$ 17,500,000		$ 17,500,000
Useful life/amortization period			60 months		60 months
Non-compete agreements
Composition of intangible assets
Total gross amount	243,000		$ 243,000		$ 243,000
Number of international distributors					2
The amount of fair value of the non-compete provisions recorded as intangible asset					$ 300,000
Non-compete agreements | Minimum
Composition of intangible assets
Useful life/amortization period					1 year
Non-compete agreements | Maximum
Composition of intangible assets
Useful life/amortization period					2 years
Notes Payable
Debt balances, including current portions:
Total debt	$ 3,039,000		$ 3,039,000		$ 9,696,000

Stock-Based Compensation - Stoc

Stock-Based Compensation - Stock Option Activity (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015	Dec. 31, 2015
Unvested options
Unnvested options exercised (in shares)	0	0		337
Unvested shares subject to repurchase right (in shares)	2,931		2,931		16,682
Liability related to share-based compensation	$ 13		$ 13		$ 67
Number of Shares Underlying Options
Outstanding at beginning of period (in shares)			5,701,000
Granted (in shares)			1,601,000
Exercised (in shares)			(1,074,000)
Canceled/forfeited/expired (in shares)			(94,000)
Outstanding at end of period (in shares)	6,134,000		6,134,000
Exercisable at end of period (in shares)	3,486,000		3,486,000

Stock-Based Compensation - Allo

Stock-Based Compensation - Allocation of Expense (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Allocation of stock-based compensation
Stock-based compensation expense	$ 2,651	$ 1,552	$ 6,117	$ 6,331
Cost of sales
Allocation of stock-based compensation
Stock-based compensation expense	61	47	143	205
Selling, general and administrative
Allocation of stock-based compensation
Stock-based compensation expense	1,933	1,160	4,436	4,637
Research and development
Allocation of stock-based compensation
Stock-based compensation expense	$ 657	$ 345	$ 1,538	$ 1,489

Stock-Based Compensation - Fair

Stock-Based Compensation - Fair Value Assumptions (Details) - Employee stock options	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Stock-based awards to employees - weighted average assumptions used to estimate fair value of options granted
Risk-free interest rate (as a percent)		1.77%	1.58%	1.78%
Expected dividend yield (as a percent)	0.00%	0.00%	0.00%	0.00%
Expected volatility rate (as a percent)		53.20%	52.80%	56.10%
Expected term		6 years 22 days	6 years 18 days	6 years 26 days

Commitments and Contingencies -

Commitments and Contingencies - Leases (Details) $ in Thousands	Jan. 01, 2017USD ($)item	Jun. 30, 2015ft²	Sep. 30, 2016USD ($)ft²	Sep. 30, 2015USD ($)	Sep. 30, 2016USD ($)ft²	Sep. 30, 2015USD ($)	Dec. 31, 2015USD ($)
Operating Leases
Deferred rent			$ 216		$ 216		$ 149
Rent expense			500	$ 200	800	$ 400
Future minimum lease payments under noncancelable operating leases
Reminder of 2016			429		429
2,017			825		825
2,018			647		647
2,019			647		647
2,020			643		643
Thereafter			659		659
Total future minimum payments			3,850		3,850
Purchase commitments
Purchase commitment due within one year			3,600		3,600		$ 2,600
Purchase commitment due beyond one year			0		0
Sublease, San Clemente, California
Operating Leases
Area of space subleased | ft²		37,700
Lease, San Clemente, California | Forecast
Operating Leases
Lease term upon expiration of the sublease	5 years
Monthly rent	$ 42
Optional lease extension term	3 years
Lease, San Clemente, California | Forecast | Minimum
Operating Leases
Annual rent increase (as a percent)	2.50%
Lease, San Clemente, California | Forecast | Maximum
Operating Leases
Annual rent increase (as a percent)	3.50%
Number of lease renewal periods | item	2
Tenant improvement allowance	$ 264
Sublease, Fjord Ventures
Future minimum lease payments under noncancelable operating leases
Total future minimum payments			$ 294		$ 294
Foreign Subsidiaries Office Leases
Operating Leases
Area of leased space | ft²			2,000		2,000

Commitments and Contingencies42

Commitments and Contingencies - Other (Details) - Agreement with the Regents	Dec. 30, 2014USD ($)	Sep. 30, 2016USD ($)	Sep. 30, 2015USD ($)	Sep. 30, 2016USD ($)item	Sep. 30, 2015USD ($)	Dec. 31, 2014USD ($)
Other commitments
Commitment obligation	$ 2,700,000	$ 1,800,000		$ 1,800,000		$ 2,700,000
Number of payments to be made in current fiscal year | item				5
Minimum required annual payment of the commitment obligation, based on net sales of current and future products		500,000		$ 500,000
Imputed interest						$ 100,000
Period of time for repayment of commitment obligation from date of IPO	60 days
Cost of sales
Other commitments
Commitment obligation payments		$ 700,000	$ 500,000		$ 1,300,000

Variable Interest Entity (Detai

Variable Interest Entity (Details) $ in Thousands	Jun. 30, 2015USD ($)director	Sep. 30, 2016USD ($)	Sep. 30, 2015USD ($)	Sep. 30, 2016USD ($)	Sep. 30, 2015USD ($)
Variable Interest Entity
Cash payments for the acquisition of certain assets of related party					$ 15,000
Charge to other expense relating to deconsolidation of DOSE					25,685
Consolidation of DOSE's results of operations:
Selling, general and administrative		$ 16,854	$ 11,237	$ 44,262	31,569
Research and development		7,807	6,173	21,824	18,752
Income tax provision		140		140
Net loss of DOSE		$ (1,159)	2,057	(4,388)	36,031
Consolidation of DOSE's cash flows:
Cash used in operating activities				9,031	(1,618)
Cash used in investing activities				(23,258)	(15,502)
Cash provided by financing activities				(2,064)	108,098
Net (decrease) increase in cash and cash equivalents				$ (16,584)	91,035
DOSE Medical Corporation
Variable Interest Entity
Cash payments for the acquisition of certain assets of related party	$ 15,000
Intercompany receivable eliminated	$ 10,900
Maximum period of support under transition services agreement	3 years
Charge to other expense relating to deconsolidation of DOSE			$ 25,700
Number of members of the Company’s board of directors who serve on the board of directors of DOSE | director	2
DOSE Medical Corporation | Variable Interest Entity, Primary Beneficiary
Consolidation of DOSE's results of operations:
Selling, general and administrative					105
Research and development					890
Interest expense					85
Net loss of DOSE					1,080
Consolidation of DOSE's cash flows:
Cash used in operating activities					(1,134)
Cash used in investing activities					(33)
Cash provided by financing activities					1,158
Net (decrease) increase in cash and cash equivalents					$ (9)

Business Segment Information (D

Business Segment Information (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2016	Sep. 30, 2015	Sep. 30, 2016	Sep. 30, 2015
Business Segment Information
Total net sales	$ 29,577	$ 19,004	$ 81,225	$ 51,424
United States
Business Segment Information
Total net sales	$ 26,935	$ 18,091	$ 74,776	$ 48,362