Intersect ENT (XENT) 10-Q 11 May 20 2020 Q1 Quarterly report Financial data

Cover Page

Cover Page - shares	3 Months Ended
	Mar. 31, 2020	May 04, 2020
Cover [Abstract]
Amendment Flag	false
Document Type	10-Q
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q1
Document Period End Date	Mar. 31, 2020
Entity Central Index Key	0001271214
Current Fiscal Year End Date	--12-31
Entity Registrant Name	INTERSECT ENT, INC.
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		32,559,239
Entity Shell Company	false
Entity Emerging Growth Company	false
Entity Small Business	false
Document Quarterly Report	true
Document Transition Report	false
Local Phone Number	641-2100
City Area Code	650
Entity Address, Postal Zip Code	94025
Entity Address, City or Town	Menlo Park
Entity Tax Identification Number	20-0280837
Entity Address, Address Line One	1555 Adams Drive
Entity File Number	001-36545
Trading Symbol	XENT
Security Exchange Name	NASDAQ
Title of 12(b) Security	Common Stock
Entity Interactive Data Current	Yes
Entity Current Reporting Status	Yes
Entity Address, State or Province	CA
Entity Incorporation, State or Country Code	DE

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands		Mar. 31, 2020	Dec. 31, 2019	[1]
Current assets:
Cash and cash equivalents		$ 34,193	$ 20,652
Short-term investments		53,517	69,986
Accounts receivable, net		10,306	19,113
Inventories, net		17,048	17,000
Prepaid expenses and other current assets		2,547	2,300
Total current assets		117,611	129,051
Property and equipment, net		6,165	6,312
Operating lease right-of-use assets		11,442	11,980
Other non-current assets		684	559
Total assets		135,902	147,902
Current liabilities:
Accounts payable		4,907	4,056
Accrued compensation		10,390	12,717
Other current liabilities		2,442	2,163
Total current liabilities		17,739	18,936
Operating lease liabilities		10,281	10,886
Other non-current liabilities		22	22
Total liabilities		28,042	29,844
Commitments and contingencies (note 7)	[1]
Stockholders' equity:
Preferred stock, $0.001 par value;Authorized shares: 10,000 at March 31, 2020 and December 31, 2019;Issued and outstanding shares: none		0	0
Common stock, $0.001 par value;Authorized shares: 150,000 at March 31, 2020 and December 31, 2019;Issued and outstanding shares: 32,537 at March 31, 2020 and 32,235 at December 31, 2019		33	32
Additional paid-in capital		356,082	348,729
Accumulated other comprehensive loss		34	53
Accumulated deficit		(248,289)	(230,756)
Total stockholders' equity		107,860	118,058
Total liabilities and stockholders' equity		$ 135,902	$ 147,902
[1]	Amounts have been derived from the December 31, 2019 audited consolidated 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	Mar. 31, 2020	Dec. 31, 2019
Statement of Financial Position [Abstract]
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares authorized	10,000	10,000
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	150,000
Common stock, shares issued	32,537	32,235
Common stock, shares outstanding	32,537	32,235

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Income Statement [Abstract]
Revenue	$ 19,826	$ 26,673
Cost of sales	6,410	4,645
Gross profit	13,416	22,028
Operating expenses:
Selling, general and administrative	26,200	27,207
Research and development	5,146	6,266
Total operating expenses	31,346	33,473
Loss from operations	(17,930)	(11,445)
Interest income and other, net	397	640
Net loss	(17,533)	(10,805)
Other comprehensive income (loss):
Unrealized (loss) gain on short-term investments, net	(19)	77
Comprehensive loss	$ (17,552)	$ (10,728)
Net loss per share, basic and diluted	$ (0.54)	$ (0.35)
Weighted average common shares used to compute net loss per share, basic and diluted	32,365	30,918

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Stockholder's Equity - USD ($) $ in Thousands	Total		Common Stock [Member]	Additional Paid-in Capital [Member]	Accumulated Other Comprehensive Income (Loss) [Member]	Accumulated Deficit [Member]
Beginning balance, Value at Dec. 31, 2018	$ 120,994		$ 31	$ 308,766	$ (41)	$ (187,762)
Beginning balance, Shares at Dec. 31, 2018			30,745
Issuance of common stock and exercise of stock options, Value	4,467			4,467
Issuance of common stock and exercise of stock options, Shares			417
Stock-based compensation expense	4,014			4,014
Unrealized gain (loss) on short-term investments	77				77
Net loss	(10,805)					(10,805)
Ending balance, Value at Mar. 31, 2019	118,747		$ 31	317,247	36	(198,567)
Ending balance, Shares at Mar. 31, 2019			31,162
Beginning balance, Value at Dec. 31, 2019	118,058	[1]	$ 32	348,729	53	(230,756)
Beginning balance, Shares at Dec. 31, 2019			32,235
Issuance of common stock and exercise of stock options, Value	3,101		$ 1	3,100
Issuance of common stock and exercise of stock options, Shares			302
Stock-based compensation expense	4,253			4,253
Unrealized gain (loss) on short-term investments	(19)				(19)
Net loss	(17,533)					(17,533)
Ending balance, Value at Mar. 31, 2020	$ 107,860		$ 33	$ 356,082	$ 34	$ (248,289)
Ending balance, Shares at Mar. 31, 2020			32,537
[1]	Amounts have been derived from the December 31, 2019 audited consolidated financial statements included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission.

Condensed Consolidated Statem_3

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020		Mar. 31, 2019
Operating activities:
Net loss	$ (17,533)		$ (10,805)
Adjustments to reconcile net loss to cash used in operating activities:
Depreciation and amortization	496		588
Amortization of right-of-use assets	538		266
Stock-based compensation expense	4,356		3,869
Amortization of net investment discount	(83)		(377)
Changes in operating assets and liabilities:
Accounts receivable, net	8,807		2,285
Inventories, net	(151)		(2,184)
Prepaid expenses and other assets	(368)		182
Accounts payable	634		(1,295)
Accrued compensation	(2,327)		899
Other liabilities	(325)		(320)
Net cash used in operating activities	(5,956)		(6,892)
Investing activities:
Purchases of short-term investments	(7,339)		(42,539)
Maturities of short-term investments	23,872		45,310
Purchases of property and equipment	(137)		(1,217)
Net cash provided by investing activities	16,396		1,554
Financing activities:
Proceeds from issuance of common stock and exercise of stock options	3,101		4,467
Net cash provided by financing activities	3,101		4,467
Net increase (decrease) in cash and cash equivalents	13,541		(871)
Cash and cash equivalents:
Beginning of the period	20,652	[1]	9,464
End of the period	34,193		8,593
Non-cash investing activities:
Right-of-use asset obtained in exchange for lease obligations	0		117
Property and equipment included in accounts payable	321		346
Lessor funded building improvements	$ 0		$ 152
[1]	Amounts have been derived from the December 31, 2019 audited consolidated financial statements included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission.

Organization

Organization	3 Months Ended
	Mar. 31, 2020
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 transforming care for patients with ear, nose and throat (“ENT”) 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 ENT physicians. These products include the PROPEL ® ® ® ® ®

Summary of Significant Accounti

Summary of Significant Accounting Policies	3 Months Ended
	Mar. 31, 2020
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	2. Summary of Significant Accounting Policies Basis of Preparation The condensed consolidated 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 condensed consolidated financial statements include the accounts of the Company and its consolidated subsidiary. All intercompany balances and transactions have been eliminated in consolidation. The interim financial data as of March 31, 2020, 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 months ended March 31, 2020 and 2019. 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 consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K Risks and Uncertainties The Company is subject to risks and uncertainties resulting from the COVID-19 COVID-19 shelter-in-place COVID-19 The magnitude of the impact of the COVID-19 re-occurrence shelter-in-place COVID-19 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, the allowance for doubtful accounts, inventory, common stock valuation and related stock-based compensation expense, leases 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, including the anticipated impact of the COVID-19 Recent Accounting Pronouncements Effective January 1, 2020, the Company adopted ASU No. 2016-13, Measurement of Credit Losses on Financial Instruments 2016-13”). 2016-13 available-for-sale 2016-13 Significant Accounting Policies There have been no significant changes to the accounting policies during the three months ended March 31, 2020, as compared to the significant accounting policies described in Note 2 of the “Notes to Consolidated Financial Statements” in the Company’s audited consolidated financial statements included in its Annual Report on Form 10-K for the year ended December 31, 2019, except as described below: Inventories Inventories are valued at the lower of cost, computed on a first-in, first-out - Credit Losses The Company is exposed to credit losses primarily through receivables from customers and collaborators and through its available-for-sale COVID-19

Composition of Certain Financia

Composition of Certain Financial Statement Items	3 Months Ended
	Mar. 31, 2020
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): March 31, December 31, 2020 2019 Accounts receivable $ 10,554 $ 19,244 Allowance for doubtful accounts (248 ) (131 ) $ 10,306 $ 19,113 Inventory (in thousands): March 31, December 31, 2020 2019 Raw materials $ 1,788 $ 2,830 Work-in-process 340 283 Finished goods 14,920 13,887 $ 17,048 $ 17,000 Capitalized stock-based compensation expense of $0.8 as Revenue (in thousands): Three Months Ended March 31, 2020 2019 PROPEL family of products $ 19,090 $ 25,732 SINUVA 736 941 $ 19,826 $ 26,673

Fair Value of Financial Instrum

Fair Value of Financial Instruments	3 Months Ended
	Mar. 31, 2020
Fair Value Disclosures [Abstract]
Fair Value of Financial Instruments	4. 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. 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 a liability. A three-tier fair value hierarchy is established as a basis for considering such assumptions and for inputs used in the valuation methodologies in measuring fair value: 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, by type of instrument measured at fair value on a recurring basis (in thousands): Reported as: March 31, 2020 Amortized Gross Unrealized Estimated Cash and cash Short-term Gains Losses Level 1: Cash $ 8,630 $ — $ — $ 8,630 $ 8,630 $ — Money market funds 25,563 — — 25,563 25,563 — 34,193 — — 34,193 34,193 — Level 2: Corporate debt securities 39,340 15 (20 ) 39,335 — 39,335 Commercial paper 14,143 39 — 14,182 — 14,182 53,483 54 (20 ) 53,517 — 53,517 $ 87,676 $ 54 $ (20 ) $ 87,710 $ 34,193 $ 53,517 Reported as: December 31, 2019 Amortized Gross Unrealized Estimated Cash and cash Short-term Gains Losses Level 1: Cash $ 11,885 $ — $ — $ 11,885 $ 11,885 $ — Money market funds 8,767 — — 8,767 8,767 — 20,652 — — 20,652 20,652 — Level 2: Corporate debt securities 50,137 33 (1 ) 50,169 — 50,169 Commercial paper 19,796 21 — 19,817 — 19,817 69,933 54 (1 ) 69,986 — 69,986 $ 90,585 $ 54 $ (1 ) $ 90,638 $ 20,652 $ 69,986 There were no transfers in and out of Level 1 and Level 2 during the three months ended March 31, 2020 and year ended December 31, 2019. As of March 31, 2020 and December 31, 2019, 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 three months ended March 31, 2020 a nd year ended December 31 , 2019 . 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. The Company concluded that any unrealized losses on investments as of March 31 , 2020 were not attributed to credit.

Stock-based Compensation Expens

Stock-based Compensation Expense	3 Months Ended
	Mar. 31, 2020
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Stock-based Compensation Expense	5. 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, 2020, the total number of shares of common stock reserved for issuance increased by 967,064 shares to 9,934,768 shares reserved since the inception of the 2014 Plan. At March 31, 2020, 3,070,479 shares remained available for issuance. A summary of the Company’s stock option activity and related information (options in thousands): Three Months Ended March 31, 2020 Weighted Average Options Exercise Price Outstanding, beginning of period 3,636 $ 23.71 Granted 559 25.88 Exercised (179 ) 17.30 Forfeited (217 ) 27.51 Outstanding, end of period 3,799 24.11 Exercisable 1,725 22.47 As of March 31, 2020, included in the outstanding options was an option subject to both service and market-based vesting conditions to purchase 427,147 shares of the Company’s common stock with an exercise price of $20.44. As of The aggregate pre-tax pre-tax A summary of the Company’s RSU activity and related information (RSUs in thousands): Three Months Ended March 31, 2020 Weighted Average RSUs Fair Value Outstanding, beginning of period 511 $ 25.62 Awarded 248 26.18 Vested (123 ) 26.89 Forfeited (40 ) 28.97 Outstanding, end of period 596 25.36 As of March 31, 2020, the aggregate pre-tax A summary of the Company’s Performance Stock Unit (PSU) activity and related information (PSUs in thousands): Three Months Ended March 31, 2020 Weighted Average PSUs Fair Value Outstanding, beginning of period 89 $ 14.22 Awarded 103 17.28 Vested — — Forfeited — — Outstanding, end of period 192 15.86 As of March 31, 2020, the aggregate pre-tax Total stock-based compensation expense recognized is as follows (in thousands): Three Months Ended March 31, 2020 2019 Cost of sales $ 441 $ 236 Selling, general and administrative 3,552 2,974 Research and development 363 659 $ 4,356 $ 3,869 As of March 31, 2020, the amount of unearned stock-based compensation currently estimated to be expensed through the year 2024 related to unvested employee stock-based awards was $38.9 million and the weighted average period over which the unearned stock-based compensation is expected to be recognized was 2.7 years. 2014 Employee Stock Purchase Plan In July 2014, the Company’s board of directors approved the 2014 Employee Stock Purchase Plan (“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”) since the inception of the 2014 ESPP. At March 31, 2020, 1,030,787 shares remained available for issuance and no shares were issued during the three months ended March 31, 2020.

Net Loss per Share

Net Loss per Share	3 Months Ended
	Mar. 31, 2020
Earnings Per Share [Abstract]
Net Loss per Share	6. 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 common stock equivalent shares from dilutive stock options, employee stock purchases and restricted stock units 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 March 31, 2020 2019 Common stock options 3,372 4,142 Market-based performance stock options 427 — Restricted stock units 596 408 Market-based performance stock units 192 — Employee stock purchase plan shares 70 74 4,657 4,624

Commitments and Contingencies

Commitments and Contingencies	3 Months Ended
	Mar. 31, 2020
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	7. 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 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. In May 2019, a purported stockholder of the Company, Avi Yaron, filed a putative class action complaint in the United States District Court for the Northern District of California, entitled Yaron v. Intersect ENT, Inc., et al., 4:19-cv-02647,

Subsequent Event

Subsequent Event	3 Months Ended
	Mar. 31, 2020
Subsequent Events [Abstract]
Subsequent Event	8. Subsequent Events Response to COVID-19 In April 2020, as a response to the COVID-19 pre-emptive , or approxima t ely 5% of its workforce, Completion of Private Placement On May 11, 2020, the Company entered into a Facility Agreement (the “Facility Agreement”) by and among the Company, as borrower, certain of the Company’s subsidiaries from time to time party thereto as guarantors and Deerfield Partners, L.P. (“Deerfield”), as agent for itself and the lenders, providing for the issuance and sale by the Company to Deerfield of $65.0 million of principal amount of 4.0% unsecured senior convertible notes (the “Convertible Notes”) upon the terms and conditions set forth in the Facility Agreement (the “Deerfield Financing”). The Convertible Notes will mature on May 9, 2025, unless earlier converted or redeemed, and are convertible into shares of the Company’s common stock, at an initial conversion price of $15.54, representing an approximately 15% premium over the Company’s closing stock price of $13.49 per share on May 8, 2020. The Company estimates that the net proceeds from the sale of the Convertible Notes were approximately $ million after deducting the estimated expenses payable by the Company. The Convertible Notes bear interest at 4.0% per annum, payable quarterly in arrears on July 1, October 1, January 1 and April 1 of each year, commencing July 1, 2020. The Convertible Notes are convertible at any time at the option of the holders thereof, provided that Deerfield is prohibited from converting the Convertible Notes into shares of common stock if, as a result of such conversion, the converting holder (together with certain affiliates and “group” members) would beneficially own more than 4.985% of the total number of shares of common stock then issued and outstanding (the “Beneficial Ownership Cap”). Pursuant to the Convertible Notes, the holders of the Convertible Notes have the option to demand repayment of all outstanding principal, any unpaid interest accrued thereon, and make whole interest, in connection with a Major Transaction (as defined in the Convertible Notes), which shall include, among others, any acquisition or other change of control of the Company; the sale or transfer of assets of the Company equal to more than 50% of the Enterprise Value (as defined in the Convertible Notes) of the Company; a liquidation, bankruptcy or other dissolution of the Company; or if at any time shares of the Company’s common stock are not listed on an Eligible Market (as defined in the Convertible Notes). The Facility Agreement contains certain specified events of default, the occurrence of which would entitle the holders of the Convertible Notes to immediately demand repayment of all outstanding principal and accrued interest on the Convertible Notes, together with a make-whole payment as determined pursuant to the Facility Agreement. Such events of default include, among others, failure to make any payment under the Convertible Notes when due, failure to observe or perform any covenant under the Facility Agreement or the other transaction documents related thereto (subject in certain cases to specified cure periods), the failure of the Company to be able to pay debts as they come due, the commencement of bankruptcy or insolvency proceedings against the Company, a material judgment levied against the Company and a material default by the Company under other indebtedness. On or after the date that is the second anniversary of the issuance date, the Company may redeem up to $32.5 million of principal amount of Convertible Notes if (1) the volume weighted average price of the common stock on each of any twenty (20) trading days during a period of thirty (30) consecutive trading days ending on the date which an optional redemption notice is delivered, (2) the volume weighted average price of the common stock on the last trading day of such period and (3) the closing price of the common stock on the last trading day of such period, in each case, are greater than 150% of the conversion price. On or after the date that is the third anniversary of the issuance date, the Company may redeem up to the entire $65.0 million original The Company is obligated to notify the holders of the Convertible Notes no less than ten trading days nor more than sixty calendar days prior to any such redemption. During the period from the date on which the Company delivers an optional redemption notice until the date the optional redemption price is paid to holders, if a holder elects to convert its Convertible Notes, it will receive the shares otherwise issuable upon conversion of the Convertible Notes, plus an additional number of shares determined in accordance with the Convertible Notes. To the extent the holder would be prohibited due to the Beneficial Ownership Cap to convert its Convertible notes during such period, such holder would be entitled to convert all or any portion of its Convertible Notes into shares of Series DF-1 Preferred Stock of the Company (such conversion, a “Preferred Stock Conversion”). The number of Series DF-1 Preferred Stock issuable upon a Preferred Stock Conversion shall be determined by dividing the number of shares of common stock of the Company that it would be entitled to receive from such conversion by 1,000. Upon any conversion of the Convertible Notes in connection with a major transaction, redemption of the Convertible Notes in connection with a major transaction or an optional redemption, holders of the Convertible Notes will also be entitled to a make-whole increase to the conversion rate. The Company is subject to a number of affirmative and restrictive covenants pursuant to the Facility Agreement, including covenants regarding compliance with applicable laws and regulations, maintenance of property, payment of taxes, maintenance of insurance, business combinations, incurrence of additional indebtedness, prepayments of other unsecured indebtedness and transactions with affiliates, among other covenants. The Company is also restricted from paying dividends or making other distributions or payments on its capital stock, subject to limited exceptions.

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2020
Accounting Policies [Abstract]
Basis of Preparation	Basis of Preparation The condensed consolidated 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 condensed consolidated financial statements include the accounts of the Company and its consolidated subsidiary. All intercompany balances and transactions have been eliminated in consolidation. The interim financial data as of March 31, 2020, 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 months ended March 31, 2020 and 2019. 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 consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K
Risks and Uncertainties	Risks and Uncertainties The Company is subject to risks and uncertainties resulting from the COVID-19 COVID-19 shelter-in-place COVID-19 The magnitude of the impact of the COVID-19 re-occurrence shelter-in-place COVID-19
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, the allowance for doubtful accounts, inventory, common stock valuation and related stock-based compensation expense, leases 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, including the anticipated impact of the COVID-19
Recent Accounting Pronouncements	Recent Accounting Pronouncements Effective January 1, 2020, the Company adopted ASU No. 2016-13, Measurement of Credit Losses on Financial Instruments 2016-13”). 2016-13 available-for-sale 2016-13
Significant Accounting Policies	Significant Accounting Policies There have been no significant changes to the accounting policies during the three months ended March 31, 2020, as compared to the significant accounting policies described in Note 2 of the “Notes to Consolidated Financial Statements” in the Company’s audited consolidated financial statements included in its Annual Report on Form 10-K for the year ended December 31, 2019, except as described below:
Inventories	Inventories Inventories are valued at the lower of cost, computed on a first-in, first-out -
Credit Losses	Credit Losses The Company is exposed to credit losses primarily through receivables from customers and collaborators and through its available-for-sale COVID-19

Composition of Certain Financ_2

Composition of Certain Financial Statement Items (Tables)	3 Months Ended
	Mar. 31, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Schedule of Accounts Receivable	Accounts Receivable (in thousands): March 31, December 31, 2020 2019 Accounts receivable $ 10,554 $ 19,244 Allowance for doubtful accounts (248 ) (131 ) $ 10,306 $ 19,113
Components of Inventory	Inventory (in thousands): March 31, December 31, 2020 2019 Raw materials $ 1,788 $ 2,830 Work-in-process 340 283 Finished goods 14,920 13,887 $ 17,048 $ 17,000
Disaggregation of Revenue	Revenue (in thousands): Three Months Ended March 31, 2020 2019 PROPEL family of products $ 19,090 $ 25,732 SINUVA 736 941 $ 19,826 $ 26,673

Fair Value of Financial Instr_2

Fair Value of Financial Instruments (Tables)	3 Months Ended
	Mar. 31, 2020
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, by type of instrument measured at fair value on a recurring basis (in thousands): Reported as: March 31, 2020 Amortized Gross Unrealized Estimated Cash and cash Short-term Gains Losses Level 1: Cash $ 8,630 $ — $ — $ 8,630 $ 8,630 $ — Money market funds 25,563 — — 25,563 25,563 — 34,193 — — 34,193 34,193 — Level 2: Corporate debt securities 39,340 15 (20 ) 39,335 — 39,335 Commercial paper 14,143 39 — 14,182 — 14,182 53,483 54 (20 ) 53,517 — 53,517 $ 87,676 $ 54 $ (20 ) $ 87,710 $ 34,193 $ 53,517 Reported as: December 31, 2019 Amortized Gross Unrealized Estimated Cash and cash Short-term Gains Losses Level 1: Cash $ 11,885 $ — $ — $ 11,885 $ 11,885 $ — Money market funds 8,767 — — 8,767 8,767 — 20,652 — — 20,652 20,652 — Level 2: Corporate debt securities 50,137 33 (1 ) 50,169 — 50,169 Commercial paper 19,796 21 — 19,817 — 19,817 69,933 54 (1 ) 69,986 — 69,986 $ 90,585 $ 54 $ (1 ) $ 90,638 $ 20,652 $ 69,986

Stock-based Compensation Expen

Stock-based Compensation Expense (Tables)	3 Months Ended
	Mar. 31, 2020
Federal Home Loan Banks [Abstract]
Summary of Stock Option Activity	A summary of the Company’s stock option activity and related information (options in thousands): Three Months Ended March 31, 2020 Weighted Average Options Exercise Price Outstanding, beginning of period 3,636 $ 23.71 Granted 559 25.88 Exercised (179 ) 17.30 Forfeited (217 ) 27.51 Outstanding, end of period 3,799 24.11 Exercisable 1,725 22.47
Summary of Restricted Stock Units Activity	A summary of the Company’s RSU activity and related information (RSUs in thousands): Three Months Ended March 31, 2020 Weighted Average RSUs Fair Value Outstanding, beginning of period 511 $ 25.62 Awarded 248 26.18 Vested (123 ) 26.89 Forfeited (40 ) 28.97 Outstanding, end of period 596 25.36
Summary of Performance Stock Units Activity	A summary of the Company’s Performance Stock Unit (PSU) activity and related information (PSUs in thousands): Three Months Ended March 31, 2020 Weighted Average PSUs Fair Value Outstanding, beginning of period 89 $ 14.22 Awarded 103 17.28 Vested — — Forfeited — — Outstanding, end of period 192 15.86
Summary of Stock Based Compensation Expense	Total stock-based compensation expense recognized is as follows (in thousands): Three Months Ended March 31, 2020 2019 Cost of sales $ 441 $ 236 Selling, general and administrative 3,552 2,974 Research and development 363 659 $ 4,356 $ 3,869

Net Loss per Share (Tables)

Net Loss per Share (Tables)	3 Months Ended
	Mar. 31, 2020
Earnings Per Share [Abstract]
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share [Table Text Block]	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 March 31, 2020 2019 Common stock options 3,372 4,142 Market-based performance stock options 427 — Restricted stock units 596 408 Market-based performance stock units 192 — Employee stock purchase plan shares 70 74 4,657 4,624

Summary of Significant Accoun_3

Summary of Significant Accounting Policies - Additional Information (Detail) $ in Millions	Mar. 31, 2020USD ($)
Summary Of Significant Accounting Policies [Line Items]
Idle Expenses in Inventory	$ 1.1
Inventory Reserve	0.8
Increase in Reserve for Credit Losses	$ 0.1

Composition of Certain Financ_3

Composition of Certain Financial Statement Items - Accounts Receivable (Detail) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Receivables [Abstract]
Accounts receivable	$ 10,554	$ 19,244
Allowance for doubtful accounts	(248)	(131)
Accounts receivable, net	$ 10,306	$ 19,113	[1]
[1]	Amounts have been derived from the December 31, 2019 audited consolidated 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 Inventories (Detail) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Inventory Disclosure [Abstract]
Raw materials	$ 1,788	$ 2,830
Work-in-process	340	283
Finished goods	14,920	13,887
Inventory	$ 17,048	$ 17,000	[1]
[1]	Amounts have been derived from the December 31, 2019 audited consolidated financial statements included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission.

Composition of Certain Financ_5

Composition of Certain Financial Statement Items - Additional Information (Detail) - USD ($) $ in Millions	Mar. 31, 2020	Dec. 31, 2019
Inventory Disclosure [Abstract]
Capitalized stock-based compensation expense	$ 0.8	$ 0.9

Composition of Certain Financ_6

Composition of Certain Financial Statement Items - Disaggregation of Revenue (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Revenues	$ 19,826	$ 26,673
Propel Family of products [Member]
Revenues	19,090	25,732
Sinuva [Member]
Revenues	$ 736	$ 941

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	Mar. 31, 2020	Dec. 31, 2019		Mar. 31, 2019	Dec. 31, 2018
Net Investment [Line Items]
Cash, cash equivalents, Estimated Fair Value	$ 34,193	$ 20,652	[1]	$ 8,593	$ 9,464
Short-term investments, Estimated Fair Value	53,517	69,986	[1]
Fair Value, Measurements, Recurring [Member]
Net Investment [Line Items]
Cash, cash equivalents and available-for-sale investments, Amortized Cost	87,676	90,585
Cash, cash equivalents and available-for-sale investments, Gross Unrealized Gains	54	54
Cash, cash equivalents and available-for-sale investments, Gross Unrealized Losses	(20)	(1)
Cash, cash equivalents and available-for-sale investments, Estimated Fair Value	87,710	90,638
Cash, cash equivalents, Estimated Fair Value	34,193	20,652
Short-term investments, Estimated Fair Value	53,517	69,986
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member]
Net Investment [Line Items]
Cash, cash equivalents and available-for-sale investments, Amortized Cost	34,193	20,652
Cash, cash equivalents and available-for-sale investments, Estimated Fair Value	34,193	20,652
Cash, cash equivalents, Estimated Fair Value	34,193	20,652
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member]
Net Investment [Line Items]
Cash, cash equivalents and available-for-sale investments, Amortized Cost	53,483	69,933
Cash, cash equivalents and available-for-sale investments, Gross Unrealized Gains	54	54
Cash, cash equivalents and available-for-sale investments, Gross Unrealized Losses	(20)	(1)
Cash, cash equivalents and available-for-sale investments, Estimated Fair Value	53,517	69,986
Short-term investments, Estimated Fair Value	53,517	69,986
Cash [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member]
Net Investment [Line Items]
Cash, cash equivalents and available-for-sale investments, Amortized Cost	8,630	11,885
Cash, cash equivalents and available-for-sale investments, Estimated Fair Value	8,630	11,885
Cash, cash equivalents, Estimated Fair Value	8,630	11,885
Money Market Funds [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member]
Net Investment [Line Items]
Cash, cash equivalents and available-for-sale investments, Amortized Cost	25,563	8,767
Cash, cash equivalents and available-for-sale investments, Estimated Fair Value	25,563	8,767
Cash, cash equivalents, Estimated Fair Value	25,563	8,767
Corporate Debt Securities [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member]
Net Investment [Line Items]
Cash, cash equivalents and available-for-sale investments, Amortized Cost	39,340	50,137
Cash, cash equivalents and available-for-sale investments, Gross Unrealized Gains	15	33
Cash, cash equivalents and available-for-sale investments, Gross Unrealized Losses	(20)	(1)
Cash, cash equivalents and available-for-sale investments, Estimated Fair Value	39,335	50,169
Short-term investments, Estimated Fair Value	39,335	50,169
Commercial Paper [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member]
Net Investment [Line Items]
Cash, cash equivalents and available-for-sale investments, Amortized Cost	14,143	19,796
Cash, cash equivalents and available-for-sale investments, Gross Unrealized Gains	39	21
Cash, cash equivalents and available-for-sale investments, Estimated Fair Value	14,182	19,817
Short-term investments, Estimated Fair Value	$ 14,182	$ 19,817
[1]	Amounts have been derived from the December 31, 2019 audited consolidated 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 ($)	3 Months Ended	12 Months Ended
	Mar. 31, 2020	Dec. 31, 2019
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
Investments with a contractual maturity of greater than one year	0	0
Other-than-temporary impairment charges	$ 0	$ 0

Stock-based Compensation Expe_2

Stock-based Compensation Expense - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Millions	Jan. 01, 2020	Jun. 30, 2018	Mar. 31, 2020	Mar. 31, 2019	Jul. 14, 2014
Weighted average period for unearned stock-based compensation to be recognized			2 years 8 months 12 days
Unearned stock-based compensation			$ 38.9
Restricted Stock Units (RSUs) [Member]
Aggregate intrinsic value, outstanding			$ 7
Weighted-average remaining contractual term, outstanding			2 years 4 months 24 days
Common Stock Options [Member]
Aggregate intrinsic value of options outstanding			$ 0.7
Aggregate intrinsic value of options exercised			$ 1.2	$ 5.1
Weighted-average remaining contractual term of options outstanding			8 years 1 month 6 days
Weighted-average remaining contractual term of options exercisable			6 years 10 months 24 days
Aggregate intrinsic value of options outstanding and exercisable			$ 0.7
Options granted			559,000
Options price, granted			$ 25.88
Performance Shares [Member]
Aggregate intrinsic value, outstanding			$ 2.3
Weighted-average remaining contractual term, outstanding			2 years 9 months 18 days
Market Based Vesting Option [Member]
Options granted			427,147
Options price, granted			$ 20.44
Employee stock purchase plan shares [Member]
Shares reserved for issuance			1,030,787
Common stock, capital shares reserved for future issuance, increase during period		1,200,000
Shares authorized for future issuance		1,696,092			496,092
2014 Equity Incentive Plan [Member]
Percentage of shares outstanding			3.00%
Shares reserved for issuance	9,934,768		3,070,479
Common stock, capital shares reserved for future issuance, increase during period	967,064

Stock-based Compensation Expe_3

Stock-based Compensation Expense - Summary of Stock Option Activity (Detail) - Common Stock Options [Member]	3 Months Ended
	Mar. 31, 2020$ / sharesshares
Class of Stock [Line Items]
Options outstanding, beginning of period | shares	3,636,000
Options granted | shares	559,000
Options exercised | shares	(179,000)
Options forfeited | shares	(217,000)
Options outstanding, end of period | shares	3,799,000
Options exercisable | shares	1,725
Options price, outstanding, beginning of period | $ / shares	$ 23.71
Options price, granted | $ / shares	25.88
Options price, exercised | $ / shares	17.30
Options price, forfeited | $ / shares	27.51
Options price, outstanding, end of period | $ / shares	24.11
Options price, exercisable | $ / shares	$ 22.47

Stock-based Compensation Expe_4

Stock-based Compensation Expense - Summary of Restricted Stock Units Activity (Detail) - Restricted stock units [Member] shares in Thousands	3 Months Ended
	Mar. 31, 2020$ / sharesshares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Outstanding, beginning of period | shares	511
Awarded | shares	248
Vested | shares	(123)
Forfeited | shares	(40)
Outstanding, end of period | shares	596
Outstanding, beginning of period | $ / shares	$ 25.62
Awarded | $ / shares	26.18
Vested | $ / shares	26.89
Forfeited | $ / shares	28.97
Outstanding, end of period | $ / shares	$ 25.36

Stock-based Compensation Expe_5

Stock-based Compensation Expense - Summary of Performance Stock Unit Activity (Detail) - Performance Shares [Member] shares in Thousands	3 Months Ended
	Mar. 31, 2020$ / sharesshares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Outstanding, beginning of period | shares	89
Awarded | shares	103
Vested | shares
Forfeited | shares
Outstanding, end of period | shares	192
Outstanding, beginning of period | $ / shares	$ 14.22
Awarded | $ / shares	17.28
Vested | $ / shares
Forfeited | $ / shares
Outstanding, end of period | $ / shares	$ 15.86

Stock-based Compensation Expe_6

Stock-based Compensation Expense - Summary of Stock Based Compensation Expense (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	$ 4,356	$ 3,869
Cost of Sales [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	441	236
Selling, General and Administrative [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	3,552	2,974
Research and Development [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	$ 363	$ 659

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
	Mar. 31, 2020	Mar. 31, 2019
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	4,657	4,624
Common Stock Options [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	3,372	4,142
Market Based Performace Stock Options [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	427
Restricted Stock Units (RSUs) [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	596	408
Market Based Performace Stock Units [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	192
Employee stock purchase plan shares [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	70	74

Subsequent Event - Additional I

Subsequent Event - Additional Information (Detail) - Subsequent Event [Member] $ / shares in Units, $ in Millions	May 11, 2020USD ($)$ / shares	May 08, 2020$ / shares	Apr. 30, 2020USD ($)Employees
Subsequent Event [Line Items]
Proceeds from issuance of private placement	$ 62.5
Debt instrument interest rate	4.00%
Debt instrument conversion price | $ / shares	$ 15.54
Premium upon conversion		15.00%
Price per share | $ / shares		$ 13.49
Debt Instrument, Redemption, Period One [Member]
Subsequent Event [Line Items]
Description debt instrument redemption	(1) the volume weighted average price of the common stock on each of any twenty (20) trading days during a period of thirty (30) consecutive trading days ending on the date which an optional redemption notice is delivered, (2) the volume weighted average price of the common stock on the last trading day of such period and (3) the closing price of the common stock on the last trading day of such period, in each case, are greater than 150% of the conversion price.
Debt Instrument, Redemption, Period Two [Member]
Subsequent Event [Line Items]
Description debt instrument redemption	(1) the volume weighted average price of the common stock on each of any twenty (20) trading days during a period of thirty (30) consecutive trading days ending on the date which an optional redemption notice is delivered, (2) the volume weighted average price of the common stock on the last trading day of such period and (3) the closing price of the common stock on the last trading day of such period, in each case, are greater than 200% of the conversion price.
Maximum [Member] | Debt Instrument, Redemption, Period One [Member]
Subsequent Event [Line Items]
Convertible notes, redemption	$ 65
Minimum [Member] | Debt Instrument, Redemption, Period One [Member]
Subsequent Event [Line Items]
Convertible notes, redemption	$ 32.5
Beneficial Owner [Member]
Subsequent Event [Line Items]
Percentage of shares held after conversion of convertible notes	4.985%
Unsecured Senior Convertible Notes [Member]
Subsequent Event [Line Items]
Issuance of private placement	$ 65
Debt instrument interest rate	4.00%
Maturity of convertible loans	May 9, 2025
COVID 19 [Member]
Subsequent Event [Line Items]
Number of employees services terminated | Employees			96
Employees services terminated | %			25.00%
Number of employees furloughed | Employees			18
Supplemental unemployment benefits			$ 0.3
Percentage of Employees Furloughed			5.00%