Intersect ENT (XENT) 10-Q 5 Nov 18 2018 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2018	Oct. 31, 2018
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2018
Document Fiscal Year Focus	2,018
Document Fiscal Period Focus	Q3
Trading Symbol	XENT
Entity Registrant Name	INTERSECT ENT, INC.
Entity Central Index Key	1,271,214
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		30,555,262
Entity Small Business	false
Entity Emerging Growth Company	false

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017	[1]
Current assets:
Cash and cash equivalents	$ 10,152	$ 19,837
Short-term investments, available-for-sale	93,869	82,483
Accounts receivable, net	14,393	16,589
Inventory	11,101	8,474
Prepaid expenses and other current assets	2,520	2,908
Total current assets	132,035	130,291
Property and equipment, net	5,128	4,848
Other non-current assets	501	436
Total assets	137,664	135,575
Current liabilities:
Accounts payable	4,018	3,400
Accrued compensation	12,204	13,152
Other current liabilities	1,279	1,125
Total current liabilities	17,501	17,677
Deferred rent and other non-current liabilities	356	679
Total liabilities	17,857	18,356
Commitments and contingencies (note 8)
Stockholders' equity:
Preferred stock, $0.001 par value; Authorized shares: 10,000 at September 30, 2018 and December 31, 2017; Issued and outstanding shares: none
Common stock, $0.001 par value; Authorized shares: 150,000 at September 30, 2018 and December 31, 2017; Issued and outstanding shares: 30,529 at September 30, 2018 and 29,678 at December 31, 2017	30	30
Additional paid-in capital	302,550	282,121
Accumulated other comprehensive loss	(41)	(92)
Accumulated deficit	(182,732)	(164,840)
Total stockholders' equity	119,807	117,219
Total liabilities and stockholders' equity	$ 137,664	$ 135,575
[1]	Amounts have been derived from the December 31, 2017 audited financial statements included in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission.

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Sep. 30, 2018	Dec. 31, 2017	[1]
Statement of Financial Position [Abstract]
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	150,000,000	150,000,000
Common stock, shares issued	30,529,000	29,678,000
Common stock, shares outstanding	30,529,000	29,678,000
[1]	Amounts have been derived from the December 31, 2017 audited financial statements included in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission.

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Income Statement [Abstract]
Revenue	$ 24,666	$ 22,313	$ 75,689	$ 66,772
Cost of sales	5,202	3,808	16,242	10,376
Gross profit	19,464	18,505	59,447	56,396
Operating expenses:
Selling, general and administrative	22,760	18,746	65,281	57,747
Research and development	4,872	4,346	13,519	12,742
Total operating expenses	27,632	23,092	78,800	70,489
Loss from operations	(8,168)	(4,587)	(19,353)	(14,093)
Interest income and other, net	572	326	1,461	882
Net loss	(7,596)	(4,261)	(17,892)	(13,211)
Other comprehensive income (loss):
Unrealized gain on short-term investments, net	46	23	51	20
Comprehensive loss	$ (7,550)	$ (4,238)	$ (17,841)	$ (13,191)
Net loss per share, basic and diluted	$ (0.25)	$ (0.15)	$ (0.59)	$ (0.46)
Weighted average common shares used to compute net loss per share, basic and diluted	30,475	29,269	30,208	28,978

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2018		Sep. 30, 2017
Operating activities:
Net loss	$ (17,892)		$ (13,211)
Adjustments to reconcile net loss to cash used in operating activities:
Depreciation and amortization	1,279		1,074
Stock-based compensation expense	10,350		7,277
Amortization of net investment (discount) premium	(546)		11
Changes in operating assets and liabilities:
Accounts receivable, net	2,196		2,741
Inventory	(2,627)		(3,115)
Prepaid expenses and other assets	(255)		(238)
Accounts payable	230		(662)
Accrued compensation	(948)		1,084
Deferred rent and other liabilities	(169)		(267)
Net cash used in operating activities	(8,382)		(5,306)
Investing activities:
Purchases of short-term investments	(96,422)		(88,568)
Maturities of short-term investments	85,633		98,721
Purchases of property and equipment	(1,242)		(1,707)
Net cash (used in) provided by investing activities	(12,031)		8,446
Financing activities:
Proceeds from issuance of common stock through employee plans	10,728		5,557
Net cash provided by financing activities	10,728		5,557
Net (decrease) increase in cash and cash equivalents	(9,685)		8,697
Cash and cash equivalents:
Beginning of the period	19,837	[1]	9,859
End of the period	10,152		18,556
Non-cash investing activities:
Property and equipment included in accounts payable	$ 533		$ 97
[1]	Amounts have been derived from the December 31, 2017 audited financial statements included in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission.

Organization

Organization	9 Months Ended
	Sep. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization	1. Organization Description of Business Intersect ENT, Inc. (the “Company”) is incorporated in the state of Delaware and its facilities are located in Menlo Park, California. The Company is a commercial drug delivery company committed to improving the quality of life for patients with ear, nose and throat conditions. The Company’s U.S. Food and Drug Administration (“FDA”) approved products are steroid releasing implants designed to treat patients suffering from chronic sinusitis who are managed by ear, nose and throat (“ENT”) physicians. These products include the PROPEL ® ® ® ® ®

Summary of Significant Accounti

Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2018
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	2. Summary of Significant Accounting Policies Basis of Preparation The financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) and pursuant to the rules and regulations of the United States Securities and Exchange Commission (“SEC”). These financial statements include the accounts of the Company and its consolidated subsidiary. All intercompany balances and transactions have been eliminated in consolidation. The functional currency of Intersect ENT GmbH, which the Company established in June 2018, is the U.S. dollar. Transaction gains and losses are included in interest income and other, net, on the Company’s statements of operations. The interim financial data as of September 30, 2018, is unaudited and is not necessarily indicative of the results for the full year. In the opinion of the Company’s management, the interim data includes only normal and recurring adjustments necessary for a fair presentation of the Company’s financial results for the three and nine months ended September 30, 2018 and 2017. Certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to SEC rules and regulations relating to interim financial statements. The accompanying condensed consolidated financial statements should be read in conjunction with the Company’s audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts and disclosures reported in the financial statements. Management uses significant judgment when making estimates related to its revenue related allowances, common stock valuation and related stock-based compensation, as well as certain accrued liabilities. Management bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ from those estimates. Significant Accounting Policies There have been no significant changes to the accounting policies during the nine months ended September 30, 2018, as compared to the significant accounting policies described in Note 2 of the “Notes to Financial Statements” in the Company’s audited financial statements included in its Annual Report, except as described below. Revenue Recognition The Company adopted Accounting Standards Codification, or ASC, Topic 606, Revenue from Contracts with Customers, The PROPEL family of products are regulated by the FDA as medical devices. The Company recognizes revenue through sales of its PROPEL family of products to hospitals and ambulatory surgery centers located almost entirely in the United States when control of the product is transferred to the customer, typically upon shipment of goods to the customer, satisfying the Company’s only performance obligation. The FDA has approved SINUVA as a pharmaceutical product and it is therefore regulated as such. The Company sells SINUVA to a limited number of specialty pharmacies and specialty distributors in the United States, (“Resellers”). These Resellers subsequently sell SINUVA to health care providers. Revenue from SINUVA sales are recognized when control of the product is transferred to the Resellers, typically upon receipt of goods by the Reseller, satisfying the Company’s only performance obligation. The Company recognizes product sales discounts, rebates, returns and other allowances as a reduction of revenue in the same period the related revenue is recognized. In addition to the agreements with the Resellers, the Company enters into arrangements with governmental agencies that result in rebates, chargebacks and discounts with respect to the purchase of SINUVA. These amounts include prompt pay discounts, Medicaid rebates, chargebacks related to Federal Supply Schedule of the General Services Administration, Distribution and Pricing Agreement with the Department of Defense and 340B of the Public Health Service Act as well as other allowances that may be offered within contracts between the Company and its direct or indirect customers relating to the Company’s sales of SINUVA, collectively referred to as “Discounts and Rebates.” Discounts and Rebates are based on amounts owed or expected to be owed on the related sales. These estimates take into consideration the Company’s historical experience, the shelf life of the product, current contractual and statutory requirements, specific known market events and trends and industry data. If actual results in the future vary from the Company’s estimates, the Company will adjust these estimates, which would affect revenue and earnings in the period such variances become known. In the balance sheet, such amounts are generally classified as reductions of accounts receivable if the amount is payable to the Resellers, or a current liability if the amount is payable to a party other than the Reseller. Recent Accounting Pronouncements There have been no significant changes to the disclosures in the recent accounting pronouncements during the nine months ended September 30, 2018, as compared to the recent accounting pronouncements described in Note 2 of the “Notes to Financial Statements” in the Company’s audited financial statements included in its Annual Report, except as described below. In July 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2018-11, Leases (Topic 842): Targeted Improvements 2018-11”). 2018-11 No. 2016-2, Leases: Amendments to the FASB Accounting Standards Codification 2016-2”), 2018-11, 2016-2, 2016-2 2016-2 2016-2 2016-2 2018-11. work-to-date, 2016-2 2016-2

Composition of Certain Financia

Composition of Certain Financial Statement Items	9 Months Ended
	Sep. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Composition of Certain Financial Statement Items	3. Composition of Certain Financial Statement Items Accounts Receivable (in thousands): September 30, December 31, Accounts receivable $ 14,499 $ 16,739 Allowance for doubtful accounts (106 ) (150 ) $ 14,393 $ 16,589 Inventory (in thousands): September 30, December 31, Raw materials $ 2,136 $ 1,221 Work-in-process 283 302 Finished goods 8,682 6,951 $ 11,101 $ 8,474

Cash, Cash Equivalents and Shor

Cash, Cash Equivalents and Short-term Investments	9 Months Ended
	Sep. 30, 2018
Cash and Cash Equivalents [Abstract]
Cash, Cash Equivalents and Short-term Investments	4. Cash, Cash Equivalents and Short-term Investments The following is a summary of cash, cash equivalents and short-term investments, available-for-sale, September 30, 2018 December 31, Amortized Gross Unrealized Estimated Amortized Gross Unrealized Estimated Cost Gains Losses Fair Value Cost Gains Losses Fair Value Cash $ 7,896 $ — $ — $ 7,896 $ 7,646 $ — $ — $ 7,646 Money market funds 2,256 — — 2,256 12,191 — — 12,191 Corporate debt securities 45,792 1 (34 ) 45,759 61,695 1 (69 ) 61,627 Commercial paper 48,118 2 (10 ) 48,110 20,880 — (24 ) 20,856 $ 104,062 $ 3 $ (44 ) $ 104,021 $ 102,412 $ 1 $ (93 ) $ 102,320 Reported as: Cash and cash equivalents $ 10,152 $ 19,837 Short-term investments, available-for-sale 93,869 82,483 $ 104,021 $ 102,320 As of September 30, 2018 and December 31, 2017, the Company had no investments with a contractual maturity of greater than one year. Based on an evaluation of securities that have been in a loss position, the Company did not recognize any other-than-temporary impairment charges during the nine months ended September 30, 2018 and year ended December 31, 2017. The Company considered various factors which included a credit and liquidity assessment of the underlying securities and the Company’s intent and ability to hold the underlying securities until the estimated date of recovery of its amortized cost.

Fair Value of Financial Instrum

Fair Value of Financial Instruments	9 Months Ended
	Sep. 30, 2018
Fair Value Disclosures [Abstract]
Fair Value of Financial Instruments	5. Fair Value of Financial Instruments The Company measures certain financial assets and liabilities at fair value on a recurring basis, including cash equivalents and short-term investments, available-for-sale. Level 1 – Observable inputs such as quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2 – Other inputs that are based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-based valuation techniques for which all significant inputs are observable in the market or can be derived from observable market data. Level 3 – Unobservable inputs that are supported by little or no market activities, which would require the Company to develop its own assumptions. The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Cash, Cash Equivalents and Short-term Investments The following is a summary of cash, cash equivalents and short-term investments, available-for-sale, September 30, 2018 December 31, 2017 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Cash $ 7,896 $ — $ — $ 7,896 $ 7,646 $ — $ — $ 7,646 Money market funds 2,256 — — 2,256 12,191 — — 12,191 Corporate debt securities — 45,759 — 45,759 — 61,627 — 61,627 Commercial paper — 48,110 — 48,110 — 20,856 — 20,856 $ 10,152 $ 93,869 $ — $ 104,021 $ 19,837 $ 82,483 $ — $ 102,320 Reported as: Cash and cash equivalents $ 10,152 $ 19,837 Short-term investments, available-for-sale 93,869 82,483 $ 104,021 $ 102,320 There were no transfers in and out of Level 1 and Level 2 during the nine months ended September 30, 2018 and year ended December 31, 2017.

Stock-based Compensation Expens

Stock-based Compensation Expense	9 Months Ended
	Sep. 30, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Stock-based Compensation Expense	6. Stock-based Compensation Expense 2014 Equity Incentive Plan In July 2014, the Company’s board of directors approved the 2014 Equity Incentive Plan (the “2014 Plan”). The number of shares of common stock reserved for issuance under the 2014 Plan will automatically increase on January 1 of each year, beginning on January 1, 2015, and continuing through and including January 1, 2024, by 3% of the total number of shares of the Company’s capital stock outstanding on December 31 of the preceding calendar year, or a lesser number of shares determined by the Company’s board of directors. On January 1, 2018, the total number of shares of common stock reserved for issuance increased by 889,393 shares to 8,045,514 shares. A summary of the Company’s stock option activity and related information (options in thousands): Nine Months Ended Options Weighted Outstanding, beginning of period 3,788 $ 16.28 Granted 756 35.06 Exercised (665 ) 13.56 Forfeited (187 ) 23.78 Outstanding, end of period 3,692 20.24 Exercisable 1,934 17.27 As of September 30, 2018, the aggregate intrinsic value of options outstanding was $36.0 million and options outstanding and exercisable was $22.8 million, the weighted-average remaining contractual term of options outstanding was 7.6 years and options outstanding and exercisable was 6.9 years. The aggregate intrinsic value of options exercised was $15.2 million and $11.2 million during the nine months ended September 30, 2018 and 2017, respectively. A summary of the Company’s RSU activity and related information (RSUs in thousands): Nine Months Ended RSUs Weighted Outstanding, beginning of period 275 $ 13.65 Awarded 194 35.61 Vested (100 ) 14.71 Forfeited (27 ) 25.57 Outstanding, end of period 342 24.83 As of September 30, 2018, the aggregate intrinsic value of RSUs outstanding was $9.8 million, calculated based on the closing price of the Company’s common stock at the end of the period, and the weighted-average remaining contractual term of RSUs outstanding was 2.1 years. Total stock-based compensation expense recognized is as follows (in thousands): Three Months Ended Nine Months Ended 2018 2017 2018 2017 Cost of sales $ 354 $ 222 $ 944 $ 670 Selling, general and administrative 2,566 1,863 7,578 5,387 Research and development 687 420 1,828 1,220 $ 3,607 $ 2,505 $ 10,350 $ 7,277 As of September 30, 2018, the amount of unearned stock-based compensation currently estimated to be expensed through the year 2022 related to unvested employee stock-based awards was $24.5 million and the weighted average period over which the unearned stock-based compensation is expected to be recognized was 2.5 years. If there are any modifications or cancellations of the underlying unvested securities, the Company may be required to accelerate, increase or cancel any remaining unearned stock-based compensation expense. Future stock-based compensation expense and unearned stock-based compensation will increase to the extent that the Company grants additional share-based payments. 2014 Employee Stock Purchase Plan In July 2014, the Company’s board of directors approved the 2014 Employee Stock Purchase Plan (the “2014 ESPP”). A total of 496,092 shares were initially reserved for issuance under the 2014 ESPP. In June 2018, the Company’s stockholders approved the Amended and Restated 2014 ESPP, increasing the total number of shares of common stock reserved for issuance under the 2014 ESPP by 1,200,000 shares to a total of 1,696,092 shares (the “Amended and Restated 2014 ESPP”). A total of 86,571 shares were issued during the nine months ended September 30, 2018.

Net Loss per Share

Net Loss per Share	9 Months Ended
	Sep. 30, 2018
Earnings Per Share [Abstract]
Net Loss per Share	7. Net Loss per Share Basic net loss per share is computed by dividing the net loss by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per share is computed by dividing the net loss by the weighted average number of shares of common stock and dilutive potential shares of common stock outstanding during the period. Because the Company has reported a net loss for all periods presented, diluted net loss per share is the same as basic net loss per share for those periods as all potentially dilutive securities were antidilutive in those periods. The following potentially dilutive securities outstanding have been excluded from the computations of weighted average shares outstanding because such securities have an antidilutive impact due to losses reported (in common stock equivalent shares, in thousands): Three Months Ended Nine Months Ended 2018 2017 2018 2017 Common stock options 3,692 3,962 3,692 3,962 RSUs 342 278 342 278 ESPP shares 102 260 102 260 4,136 4,500 4,136 4,500

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
	Sep. 30, 2018
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	8. Commitments and Contingencies Contingencies In the normal course of business, the Company enters into contracts and agreements that contain a variety of representations and warranties and provide for general indemnifications. The Company’s exposure under these agreements is unknown because it involves claims that may be made against the Company in the future, but have not yet been made. The Company accrues a liability for such matters when it is probable that future expenditures will be made and such amounts can be reasonably estimated. Indemnification The Company’s amended and restated certificate of incorporation contains provisions limiting the liability of directors, and its amended and restated bylaws provide that the Company will indemnify each of its directors to the fullest extent permitted under Delaware law. The Company’s amended and restated certificate of incorporation and amended and restated bylaws also provide its board of directors with discretion to indemnify its officers and employees when determined appropriate by the board. In addition, the Company has entered and expects to continue to enter into agreements to indemnify its directors and executive officers. Litigation The Company is not currently a party to any material legal proceedings. The Company may at times be involved in litigation and other legal claims in the ordinary course of business. When appropriate in the Company’s estimation, it may record reserves in its financial statements for pending litigation and other claims.

Income Taxes

Income Taxes	9 Months Ended
	Sep. 30, 2018
Income Tax Disclosure [Abstract]
Income Taxes	9. Income Taxes The Company has a history of losses, and expects to record a loss in 2018, and therefore has not recorded a provision for income taxes. In December 2017, the U.S. government enacted comprehensive tax legislation, commonly referred to as the Tax Cuts and Jobs Act (“Tax Act”). The Tax Act makes broad and complex changes to the U.S. tax code, including, but not limited to, (1) reducing the U.S. federal corporate tax rate from 35 percent to 21 percent; (2) requiring companies to pay a one-time The Company has not historically had significant non-U.S.

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2018
Accounting Policies [Abstract]
Basis of Preparation	Basis of Preparation The financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) and pursuant to the rules and regulations of the United States Securities and Exchange Commission (“SEC”). These financial statements include the accounts of the Company and its consolidated subsidiary. All intercompany balances and transactions have been eliminated in consolidation. The functional currency of Intersect ENT GmbH, which the Company established in June 2018, is the U.S. dollar. Transaction gains and losses are included in interest income and other, net, on the Company’s statements of operations. The interim financial data as of September 30, 2018, is unaudited and is not necessarily indicative of the results for the full year. In the opinion of the Company’s management, the interim data includes only normal and recurring adjustments necessary for a fair presentation of the Company’s financial results for the three and nine months ended September 30, 2018 and 2017. Certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to SEC rules and regulations relating to interim financial statements. The accompanying condensed consolidated financial statements should be read in conjunction with the Company’s audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K
Use of Estimates	Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts and disclosures reported in the financial statements. Management uses significant judgment when making estimates related to its revenue related allowances, common stock valuation and related stock-based compensation, as well as certain accrued liabilities. Management bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results could differ from those estimates.
Significant Accounting Policies	Significant Accounting Policies There have been no significant changes to the accounting policies during the nine months ended September 30, 2018, as compared to the significant accounting policies described in Note 2 of the “Notes to Financial Statements” in the Company’s audited financial statements included in its Annual Report, except as described below.
Revenue Recognition	Revenue Recognition The Company adopted Accounting Standards Codification, or ASC, Topic 606, Revenue from Contracts with Customers, The PROPEL family of products are regulated by the FDA as medical devices. The Company recognizes revenue through sales of its PROPEL family of products to hospitals and ambulatory surgery centers located almost entirely in the United States when control of the product is transferred to the customer, typically upon shipment of goods to the customer, satisfying the Company’s only performance obligation. The FDA has approved SINUVA as a pharmaceutical product and it is therefore regulated as such. The Company sells SINUVA to a limited number of specialty pharmacies and specialty distributors in the United States, (“Resellers”). These Resellers subsequently sell SINUVA to health care providers. Revenue from SINUVA sales are recognized when control of the product is transferred to the Resellers, typically upon receipt of goods by the Reseller, satisfying the Company’s only performance obligation. The Company recognizes product sales discounts, rebates, returns and other allowances as a reduction of revenue in the same period the related revenue is recognized. In addition to the agreements with the Resellers, the Company enters into arrangements with governmental agencies that result in rebates, chargebacks and discounts with respect to the purchase of SINUVA. These amounts include prompt pay discounts, Medicaid rebates, chargebacks related to Federal Supply Schedule of the General Services Administration, Distribution and Pricing Agreement with the Department of Defense and 340B of the Public Health Service Act as well as other allowances that may be offered within contracts between the Company and its direct or indirect customers relating to the Company’s sales of SINUVA, collectively referred to as “Discounts and Rebates.” Discounts and Rebates are based on amounts owed or expected to be owed on the related sales. These estimates take into consideration the Company’s historical experience, the shelf life of the product, current contractual and statutory requirements, specific known market events and trends and industry data. If actual results in the future vary from the Company’s estimates, the Company will adjust these estimates, which would affect revenue and earnings in the period such variances become known. In the balance sheet, such amounts are generally classified as reductions of accounts receivable if the amount is payable to the Resellers, or a current liability if the amount is payable to a party other than the Reseller.
Recent Accounting Pronouncements	Recent Accounting Pronouncements There have been no significant changes to the disclosures in the recent accounting pronouncements during the nine months ended September 30, 2018, as compared to the recent accounting pronouncements described in Note 2 of the “Notes to Financial Statements” in the Company’s audited financial statements included in its Annual Report, except as described below. In July 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2018-11, Leases (Topic 842): Targeted Improvements 2018-11”). 2018-11 No. 2016-2, Leases: Amendments to the FASB Accounting Standards Codification 2016-2”), 2018-11, 2016-2, 2016-2 2016-2 2016-2 2016-2 2018-11. work-to-date, 2016-2 2016-2

Composition of Certain Financ_2

Composition of Certain Financial Statement Items (Tables)	9 Months Ended
	Sep. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Schedule of Accounts Receivable	Accounts Receivable (in thousands): September 30, December 31, Accounts receivable $ 14,499 $ 16,739 Allowance for doubtful accounts (106 ) (150 ) $ 14,393 $ 16,589
Components of Inventory	Inventory (in thousands): September 30, December 31, Raw materials $ 2,136 $ 1,221 Work-in-process 283 302 Finished goods 8,682 6,951 $ 11,101 $ 8,474

Cash, Cash Equivalents and Sh_2

Cash, Cash Equivalents and Short-term Investments (Tables)	9 Months Ended
	Sep. 30, 2018
Cash and Cash Equivalents [Abstract]
Summary of Cash, Cash Equivalents and Available-for-Sale Investments by Type of Instrument	The following is a summary of cash, cash equivalents and short-term investments, available-for-sale, September 30, 2018 December 31, Amortized Gross Unrealized Estimated Amortized Gross Unrealized Estimated Cost Gains Losses Fair Value Cost Gains Losses Fair Value Cash $ 7,896 $ — $ — $ 7,896 $ 7,646 $ — $ — $ 7,646 Money market funds 2,256 — — 2,256 12,191 — — 12,191 Corporate debt securities 45,792 1 (34 ) 45,759 61,695 1 (69 ) 61,627 Commercial paper 48,118 2 (10 ) 48,110 20,880 — (24 ) 20,856 $ 104,062 $ 3 $ (44 ) $ 104,021 $ 102,412 $ 1 $ (93 ) $ 102,320 Reported as: Cash and cash equivalents $ 10,152 $ 19,837 Short-term investments, available-for-sale 93,869 82,483 $ 104,021 $ 102,320

Fair Value of Financial Instr_2

Fair Value of Financial Instruments (Tables)	9 Months Ended
	Sep. 30, 2018
Fair Value Disclosures [Abstract]
Summary of Cash, Cash Equivalents and Available-for-Sale Investments Measured at Fair Value on Recurring Basis	The following is a summary of cash, cash equivalents and short-term investments, available-for-sale, September 30, 2018 December 31, 2017 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Cash $ 7,896 $ — $ — $ 7,896 $ 7,646 $ — $ — $ 7,646 Money market funds 2,256 — — 2,256 12,191 — — 12,191 Corporate debt securities — 45,759 — 45,759 — 61,627 — 61,627 Commercial paper — 48,110 — 48,110 — 20,856 — 20,856 $ 10,152 $ 93,869 $ — $ 104,021 $ 19,837 $ 82,483 $ — $ 102,320 Reported as: Cash and cash equivalents $ 10,152 $ 19,837 Short-term investments, available-for-sale 93,869 82,483 $ 104,021 $ 102,320

Stock-based Compensation Expe_2

Stock-based Compensation Expense (Tables)	9 Months Ended
	Sep. 30, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Summary of Stock Option Activity	A summary of the Company’s stock option activity and related information (options in thousands): Nine Months Ended Options Weighted Outstanding, beginning of period 3,788 $ 16.28 Granted 756 35.06 Exercised (665 ) 13.56 Forfeited (187 ) 23.78 Outstanding, end of period 3,692 20.24 Exercisable 1,934 17.27
Summary of Restricted Stock Units Activity	A summary of the Company’s RSU activity and related information (RSUs in thousands): Nine Months Ended RSUs Weighted Outstanding, beginning of period 275 $ 13.65 Awarded 194 35.61 Vested (100 ) 14.71 Forfeited (27 ) 25.57 Outstanding, end of period 342 24.83
Summary of Stock Based Compensation Expense	Total stock-based compensation expense recognized is as follows (in thousands): Three Months Ended Nine Months Ended 2018 2017 2018 2017 Cost of sales $ 354 $ 222 $ 944 $ 670 Selling, general and administrative 2,566 1,863 7,578 5,387 Research and development 687 420 1,828 1,220 $ 3,607 $ 2,505 $ 10,350 $ 7,277

Net Loss per Share (Tables)

Net Loss per Share (Tables)	9 Months Ended
	Sep. 30, 2018
Earnings Per Share [Abstract]
Schedule of Potentially Dilutive Securities Outstanding Excluded from the Computations of Diluted Weighted Average Shares Outstanding	The following potentially dilutive securities outstanding have been excluded from the computations of weighted average shares outstanding because such securities have an antidilutive impact due to losses reported (in common stock equivalent shares, in thousands): Three Months Ended Nine Months Ended 2018 2017 2018 2017 Common stock options 3,692 3,962 3,692 3,962 RSUs 342 278 342 278 ESPP shares 102 260 102 260 4,136 4,500 4,136 4,500

Composition of Certain Financ_3

Composition of Certain Financial Statement Items - Accounts Receivable (Detail) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Receivables [Abstract]
Accounts receivable	$ 14,499	$ 16,739
Allowance for doubtful accounts	(106)	(150)
Accounts receivable, net	$ 14,393	$ 16,589	[1]
[1]	Amounts have been derived from the December 31, 2017 audited financial statements included in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission.

Composition of Certain Financ_4

Composition of Certain Financial Statement Items - Components of Inventory (Detail) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017
Inventory Disclosure [Abstract]
Raw materials	$ 2,136	$ 1,221
Work-in-process	283	302
Finished goods	8,682	6,951
Inventory	$ 11,101	$ 8,474	[1]
[1]	Amounts have been derived from the December 31, 2017 audited financial statements included in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission.

Cash, Cash Equivalents and Sh_3

Cash, Cash Equivalents and Short-term Investments - Summary of Cash, Cash Equivalents and Available-for-Sale Investments by Type of Instrument (Detail) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017		Sep. 30, 2017	Dec. 31, 2016
Net Investment [Line Items]
Cash, cash equivalents and available-for-sale investments, Amortized Cost	$ 104,062	$ 102,412
Cash, cash equivalents and available-for-sale investments, Gross Unrealized Gains	3	1
Cash, cash equivalents and available-for-sale investments, Gross Unrealized Losses	(44)	(93)
Cash, cash equivalents and available-for-sale investments, Estimated Fair Value	104,021	102,320
Cash, cash equivalents, Estimated Fair Value	10,152	19,837	[1]	$ 18,556	$ 9,859
Short-term investments, available-for-sale, Estimated Fair Value	93,869	82,483	[1]
Cash and cash equivalents and short-term investments, available-for-sale	104,021	102,320
Cash [Member]
Net Investment [Line Items]
Cash, cash equivalents and available-for-sale investments, Amortized Cost	7,896	7,646
Cash, cash equivalents and available-for-sale investments, Estimated Fair Value	7,896	7,646
Money Market Funds [Member]
Net Investment [Line Items]
Cash, cash equivalents and available-for-sale investments, Amortized Cost	2,256	12,191
Cash, cash equivalents and available-for-sale investments, Estimated Fair Value	2,256	12,191
Corporate Debt Securities [Member]
Net Investment [Line Items]
Cash, cash equivalents and available-for-sale investments, Amortized Cost	45,792	61,695
Cash, cash equivalents and available-for-sale investments, Gross Unrealized Gains	1	1
Cash, cash equivalents and available-for-sale investments, Gross Unrealized Losses	(34)	(69)
Cash, cash equivalents and available-for-sale investments, Estimated Fair Value	45,759	61,627
Commercial Paper [Member]
Net Investment [Line Items]
Cash, cash equivalents and available-for-sale investments, Amortized Cost	48,118	20,880
Cash, cash equivalents and available-for-sale investments, Gross Unrealized Gains	2
Cash, cash equivalents and available-for-sale investments, Gross Unrealized Losses	(10)	(24)
Cash, cash equivalents and available-for-sale investments, Estimated Fair Value	$ 48,110	$ 20,856
[1]	Amounts have been derived from the December 31, 2017 audited financial statements included in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission.

Cash, Cash Equivalents and Sh_4

Cash, Cash Equivalents and Short-term Investments - Additional Information (Detail) - USD ($)	9 Months Ended	12 Months Ended
	Sep. 30, 2018	Dec. 31, 2017
Investments Schedule [Abstract]
Investments with a contractual maturity of greater than one year	$ 0	$ 0
Other-than-temporary impairment charges	$ 0	$ 0

Fair Value of Financial Instr_3

Fair Value of Financial Instruments - Summary of Cash, Cash Equivalents and Short-Term Investments Available-for-Sale, by Type of Instrument (Detail) - USD ($) $ in Thousands	Sep. 30, 2018	Dec. 31, 2017		Sep. 30, 2017	Dec. 31, 2016
Net Investment [Line Items]
Cash and cash equivalents	$ 10,152	$ 19,837	[1]	$ 18,556	$ 9,859
Short-term investments, available-for-sale	93,869	82,483	[1]
Cash and cash equivalents and short-term investments, available-for-sale	104,021	102,320
Fair Value on Recurring Basis [Member]
Net Investment [Line Items]
Cash and cash equivalents	10,152	19,837
Short-term investments, available-for-sale	93,869	82,483
Cash and cash equivalents and short-term investments, available-for-sale	104,021	102,320
Fair Value on Recurring Basis [Member] | Cash [Member]
Net Investment [Line Items]
Cash and cash equivalents and short-term investments, available-for-sale	7,896	7,646
Fair Value on Recurring Basis [Member] | Money Market Funds [Member]
Net Investment [Line Items]
Cash and cash equivalents and short-term investments, available-for-sale	2,256	12,191
Fair Value on Recurring Basis [Member] | Corporate Debt Securities [Member]
Net Investment [Line Items]
Cash and cash equivalents and short-term investments, available-for-sale	45,759	61,627
Fair Value on Recurring Basis [Member] | Commercial Paper [Member]
Net Investment [Line Items]
Cash and cash equivalents and short-term investments, available-for-sale	48,110	20,856
Level 1 [Member] | Fair Value on Recurring Basis [Member]
Net Investment [Line Items]
Cash and cash equivalents and short-term investments, available-for-sale	10,152	19,837
Level 1 [Member] | Fair Value on Recurring Basis [Member] | Cash [Member]
Net Investment [Line Items]
Cash and cash equivalents and short-term investments, available-for-sale	7,896	7,646
Level 1 [Member] | Fair Value on Recurring Basis [Member] | Money Market Funds [Member]
Net Investment [Line Items]
Cash and cash equivalents and short-term investments, available-for-sale	2,256	12,191
Level 2 [Member] | Fair Value on Recurring Basis [Member]
Net Investment [Line Items]
Cash and cash equivalents and short-term investments, available-for-sale	93,869	82,483
Level 2 [Member] | Fair Value on Recurring Basis [Member] | Corporate Debt Securities [Member]
Net Investment [Line Items]
Cash and cash equivalents and short-term investments, available-for-sale	45,759	61,627
Level 2 [Member] | Fair Value on Recurring Basis [Member] | Commercial Paper [Member]
Net Investment [Line Items]
Cash and cash equivalents and short-term investments, available-for-sale	$ 48,110	$ 20,856
[1]	Amounts have been derived from the December 31, 2017 audited financial statements included in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission.

Fair Value of Financial Instr_4

Fair Value of Financial Instruments - Additional Information (Detail) - USD ($)	Sep. 30, 2018	Dec. 31, 2017
Fair Value Disclosures [Abstract]
Transfer of assets from level 1 to level 2	$ 0	$ 0
Transfer of liabilities from level 1 to level 2	0	0
Transfer of assets from level 2 to level 1	0	0
Transfer of liabilities from level 2 to level 1	$ 0	$ 0

Stock-based Compensation Expe_3

Stock-based Compensation Expense - Additional Information (Detail) - USD ($) $ in Millions	Jan. 01, 2018	Jun. 30, 2018	Sep. 30, 2018	Sep. 30, 2017	Jul. 23, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unearned stock-based compensation			$ 24.5
Weighted average period for unearned stock-based compensation to be recognized			2 years 6 months
RSUs [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Aggregate intrinsic value of RSUs outstanding			$ 9.8
Weighted-average remaining contractual term of RSUs outstanding			2 years 1 month 6 days
Common Stock Options [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Aggregate intrinsic value of options outstanding and exercisable			$ 22.8
Aggregate intrinsic value of options outstanding			36
Aggregate intrinsic value of options exercised			$ 15.2	$ 11.2
Weighted-average remaining contractual term of options outstanding			7 years 7 months 6 days
Weighted-average remaining contractual term of options exercisable			6 years 10 months 24 days
2014 Employee Stock Purchase Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock, capital shares reserved for future issuance, increase during period		1,200,000
Shares authorized for future issuance		1,696,092			496,092
Shares Issued			86,571
2014 Equity Incentive Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage of shares outstanding			3.00%
Common stock, capital shares reserved for future issuance, increase during period	889,393
Shares reserved for issuance	8,045,514		8,045,514

Stock-based Compensation Expe_4

Stock-based Compensation Expense - Summary of Stock Option Activity (Detail) - Common Stock Options [Member] shares in Thousands	9 Months Ended
	Sep. 30, 2018$ / sharesshares
Class of Stock [Line Items]
Options outstanding, beginning of period | shares	3,788
Options granted | shares	756
Options exercised | shares	(665)
Options forfeited | shares	(187)
Options outstanding, end of period | shares	3,692
Options exercisable | shares	1,934
Options price, outstanding, beginning of period | $ / shares	$ 16.28
Options price, granted | $ / shares	35.06
Options price, exercised | $ / shares	13.56
Options price, forfeited | $ / shares	23.78
Options price, outstanding, end of period | $ / shares	20.24
Options price, exercisable | $ / shares	$ 17.27

Stock-based Compensation Expe_5

Stock-based Compensation Expense - Summary of Restricted Stock Units Activity (Detail) - RSUs [Member] shares in Thousands	9 Months Ended
	Sep. 30, 2018$ / sharesshares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Outstanding, beginning of period | shares	275
Awarded | shares	194
Vested | shares	(100)
Forfeited | shares	(27)
Outstanding, end of period | shares	342
Outstanding, beginning of period | $ / shares	$ 13.65
Awarded | $ / shares	35.61
Vested | $ / shares	14.71
Forfeited | $ / shares	25.57
Outstanding, end of period | $ / shares	$ 24.83

Stock-based Compensation Expe_6

Stock-based Compensation Expense - Summary of Stock Based Compensation Expense (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	$ 3,607	$ 2,505	$ 10,350	$ 7,277
Cost of Sales [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	354	222	944	670
Selling, General and Administrative [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	2,566	1,863	7,578	5,387
Research and Development [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	$ 687	$ 420	$ 1,828	$ 1,220

Net Loss per Share - Schedule o

Net Loss per Share - Schedule of Potentially Dilutive Securities Outstanding Excluded from the Computations of Diluted Weighted Average Shares Outstanding (Detail) - shares shares in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of diluted weighted average shares outstanding	4,136	4,500	4,136	4,500
Common Stock Options [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of diluted weighted average shares outstanding	3,692	3,962	3,692	3,962
RSUs [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of diluted weighted average shares outstanding	342	278	342	278
2014 Employee Stock Purchase Plan [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of diluted weighted average shares outstanding	102	260	102	260

Income Taxes - Additional Infor

Income Taxes - Additional Information (Detail) - USD ($)	9 Months Ended	12 Months Ended
	Sep. 30, 2018	Dec. 31, 2017
Income Tax Disclosure [Abstract]
Provision for income taxes	$ 0
U.S. federal corporate tax rate	21.00%	35.00%