Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Sep. 30, 2013 | Nov. 01, 2013 | |
Document And Entity Information [Abstract] | ' | ' |
Document Type | '10-Q | ' |
Amendment Flag | 'false | ' |
Document Period End Date | 30-Sep-13 | ' |
Document Fiscal Year Focus | '2013 | ' |
Document Fiscal Period Focus | 'Q3 | ' |
Entity Registrant Name | 'HeartWare International, Inc. | ' |
Entity Central Index Key | '0001389072 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Large Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 16,462,034 |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $187,906 | $85,921 |
Short-term investments | 35,875 | 16,887 |
Accounts receivable, net | 30,305 | 25,225 |
Inventories | 37,883 | 38,443 |
Prepaid expenses and other current assets | 11,511 | 5,925 |
Total current assets | 303,480 | 172,401 |
Property, plant and equipment, net | 16,312 | 19,380 |
Goodwill | 1,190 | 1,190 |
Other intangible assets, net | 8,003 | 7,794 |
Deferred financing costs, net | 2,059 | 2,329 |
Long-term investments | 1,225 | ' |
Other assets | 3,686 | 3,405 |
Total assets | 335,955 | 206,499 |
Current liabilities: | ' | ' |
Accounts payable | 9,280 | 12,024 |
Other accrued liabilities | 25,694 | 22,020 |
Total current liabilities | 34,974 | 34,044 |
Convertible senior notes, net | 105,345 | 100,315 |
Other long-term liabilities | 3,691 | 3,929 |
Commitments and contingencies - See Note 15 | ' | ' |
Stockholders' equity: | ' | ' |
Preferred stock - $.001 par value; 5,000 shares authorized; no shares issued and outstanding at September 30, 2013 and December 31, 2012 | ' | ' |
Common stock - $.001 par value; 25,000 shares authorized; 16,458 and 14,582 shares issued and outstanding at September 30, 2013 and December 31, 2012, respectively | 16 | 15 |
Additional paid-in capital | 507,098 | 346,301 |
Accumulated deficit | -307,305 | -270,042 |
Accumulated other comprehensive loss: | ' | ' |
Cumulative translation adjustments | -7,835 | -8,039 |
Unrealized loss on investments | -29 | -24 |
Total accumulated other comprehensive loss | -7,864 | -8,063 |
Total stockholders' equity | 191,945 | 68,211 |
Total liabilities and stockholders' equity | $335,955 | $206,499 |
Condensed_Consolidated_Balance1
Condensed Consolidated Balance Sheets (Parenthetical) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, except Per Share data, unless otherwise specified | ||
Statement Of Financial Position [Abstract] | ' | ' |
Preferred stock, par value | $0.00 | $0.00 |
Preferred stock, shares authorized | 5,000 | 5,000 |
Preferred stock, shares issued | ' | ' |
Preferred stock, shares outstanding | ' | ' |
Common stock, par value | $0.00 | $0.00 |
Common stock, shares authorized | 25,000 | 25,000 |
Common stock, shares issued | 16,458 | 14,582 |
Common stock, shares outstanding | 16,458 | 14,582 |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements of Operations (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Income Statement [Abstract] | ' | ' | ' | ' |
Revenue, net | $54,800 | $22,862 | $154,875 | $78,261 |
Cost of revenue | 19,529 | 10,925 | 57,175 | 34,418 |
Gross profit | 35,271 | 11,937 | 97,700 | 43,843 |
Operating expenses: | ' | ' | ' | ' |
Selling, general and administrative | 19,844 | 13,768 | 53,548 | 40,687 |
Research and development | 25,930 | 21,379 | 72,201 | 61,392 |
Total operating expenses | 45,774 | 35,147 | 125,749 | 102,079 |
Loss from operations | -10,503 | -23,210 | -28,049 | -58,236 |
Other income (expense): | ' | ' | ' | ' |
Foreign exchange gain (loss) | 2,082 | 1,153 | -416 | 63 |
Interest expense | -3,082 | -2,876 | -9,088 | -8,477 |
Investment income, net | 53 | 28 | 162 | 198 |
Other, net | 79 | -81 | 128 | -161 |
Loss before income taxes | -11,371 | -24,986 | -37,263 | -66,613 |
Provision for income taxes | ' | ' | ' | ' |
Net loss | ($11,371) | ($24,986) | ($37,263) | ($66,613) |
Net loss per common share - basic and diluted | ($0.69) | ($1.75) | ($2.34) | ($4.70) |
Weighted average shares outstanding - basic and diluted | 16,439 | 14,274 | 15,895 | 14,185 |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statements of Comprehensive Loss (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Statement Of Income And Comprehensive Income [Abstract] | ' | ' | ' | ' |
Net loss | ($11,371) | ($24,986) | ($37,263) | ($66,613) |
Other comprehensive income (loss) | ' | ' | ' | ' |
Foreign currency translation adjustments | -186 | -189 | 204 | -259 |
Unrealized gain (loss) on investments | 39 | 3 | -5 | 23 |
Comprehensive loss | ($11,518) | ($25,172) | ($37,064) | ($66,849) |
Condensed_Consolidated_Stateme2
Condensed Consolidated Statement of Stockholders' Equity (USD $) | Total | Common Shares [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Accumulated Other Comprehensive Loss [Member] |
In Thousands, except Share data | |||||
Beginning balance at Dec. 31, 2012 | $68,211 | $15 | $346,301 | ($270,042) | ($8,063) |
Beginning balance, Shares at Dec. 31, 2012 | ' | 14,582,000 | ' | ' | ' |
Issuance of common stock pursuant to public offering, net of offering costs | 140,978 | 1 | 140,977 | ' | ' |
Issuance of common stock pursuant to public offering, net of offering costs, shares | ' | 1,725,000 | ' | ' | ' |
Issuance of common stock pursuant to share-based awards | 3,378 | ' | 3,378 | ' | ' |
Issuance of common stock pursuant to share-based awards, shares | ' | 151,000 | ' | ' | ' |
Share-based compensation | 16,442 | ' | 16,442 | ' | ' |
Net loss | -37,263 | ' | ' | -37,263 | ' |
Other comprehensive income | 199 | ' | ' | ' | 199 |
Ending balance at Sep. 30, 2013 | $191,945 | $16 | $507,098 | ($307,305) | ($7,864) |
Ending balance, Shares at Sep. 30, 2013 | ' | 16,458,000 | ' | ' | ' |
Condensed_Consolidated_Stateme3
Condensed Consolidated Statements of Cash Flows (USD $) | 9 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ' | ' |
Net loss | ($37,263,000) | ($66,613,000) |
Adjustments to reconcile net loss to net cash used in operating activities: | ' | ' |
Depreciation of property, plant and equipment | 4,823,000 | 3,322,000 |
Amortization of intangible assets | 375,000 | 123,000 |
Share-based compensation expense | 16,442,000 | 14,947,000 |
Amortization of premium on investments | 437,000 | 534,000 |
Amortization of discount on convertible senior notes | 5,030,000 | 4,460,000 |
Amortization of deferred financing costs | 270,000 | 239,000 |
Other | 711,000 | 485,000 |
Change in operating assets and liabilities: | ' | ' |
Accounts receivable | -4,806,000 | -2,190,000 |
Inventories | -768,000 | -6,684,000 |
Prepaid expenses and other current assets | -5,554,000 | -1,194,000 |
Accounts payable | -2,741,000 | 4,349,000 |
Accrued interest on convertible senior notes | 1,262,000 | 1,262,000 |
Other accrued liabilities | 2,396,000 | -50,000 |
Other long-term liabilities | -238,000 | 672,000 |
Net cash used in operating activities | -19,624,000 | -46,338,000 |
CASH FLOWS FROM INVESTING ACTIVITIES | ' | ' |
Purchases of investments | -23,191,000 | -15,000,000 |
Maturities of investments | 2,226,000 | 101,507,000 |
Acquisition of World Heart, net of cash acquired | ' | 3,687,000 |
Additions to property, plant and equipment | -2,107,000 | -4,201,000 |
Proceeds from sale of equipment | 743,000 | ' |
Additions to patents | -584,000 | -376,000 |
Cash paid for security deposits | ' | -750,000 |
Net cash (used in) provided by investing activities | -22,913,000 | 84,867,000 |
CASH FLOWS FROM FINANCING ACTIVITIES | ' | ' |
Proceeds from issuance of common stock | 149,126,000 | ' |
Payment of common stock issuance costs | -8,148,000 | ' |
Proceeds from exercise of stock options | 3,378,000 | 2,316,000 |
Net cash provided by financing activities | 144,356,000 | 2,316,000 |
Effect of exchange rate changes on cash and cash equivalents | 166,000 | -219,000 |
INCREASE IN CASH AND CASH EQUIVALENTS | 101,985,000 | 40,626,000 |
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD | 85,921,000 | 71,257,000 |
CASH AND CASH EQUIVALENTS - END OF PERIOD | $187,906,000 | $111,883,000 |
Basis_of_Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2013 | |
Accounting Policies [Abstract] | ' |
Basis of Presentation | ' |
Note 1. Basis of Presentation | |
HeartWare International, Inc., referred to in these notes collectively with its subsidiaries as “we,” “our,” “HeartWare,” the “HeartWare Group” or the “Company,” is a medical device company that develops, manufactures and markets miniaturized implantable heart pumps, or ventricular assist devices, to treat patients suffering from advanced heart failure. | |
The accompanying unaudited interim condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for reporting of interim financial information. Pursuant to these rules and regulations, certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted. Accordingly, these statements do not include all the disclosures normally required by accounting principles generally accepted in the United States for annual financial statements and should be read in conjunction with Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in this report and the audited financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2012. The accompanying condensed consolidated balance sheet as of December 31, 2012 has been derived from our audited financial statements. The condensed consolidated statements of operations for the three and nine months ended September 30, 2013 and cash flows for the nine months ended September 30, 2013 are not necessarily indicative of the results to be expected for any future period or for the year ending December 31, 2013. | |
In the opinion of management, the accompanying unaudited interim condensed consolidated financial statements contain all adjustments (consisting of only normally recurring adjustments) necessary to present fairly the financial position and results of operations as of the dates and for the periods presented. |
Liquidity
Liquidity | 9 Months Ended |
Sep. 30, 2013 | |
Text Block [Abstract] | ' |
Liquidity | ' |
Note 2. Liquidity | |
At September 30, 2013, we had approximately $225.0 million of cash, cash equivalents and investments. | |
We have financed our operations primarily through the issuance of shares of our common stock and the issuance of convertible notes. Most recently, in March 2013, we completed a public offering of 1,725,000 shares of our common stock, including the underwriters’ exercise of their over-allotment option to purchase 225,000 shares, at an offering price of $86.45 per share for aggregate gross proceeds of approximately $149.1 million. After fees and related expenses, net proceeds from the offering were approximately $141.0 million. See Note 11 (Stockholders’ Equity) for more information. | |
For the remainder of 2013, our cash, cash equivalents and investments are expected to primarily be used to fund our ongoing operations including expanding our sales and marketing capabilities on a global basis, research and development of new and existing products (including clinical trials), components and accessories, regulatory and other compliance functions as well as for general working capital. We believe our cash, cash equivalents and investment balances are sufficient to support our planned operations for at least the next twelve months. | |
The accompanying condensed consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States, which contemplate continuation of the Company as a going concern. We have incurred substantial losses from operations since our inception, and losses have continued through September 30, 2013. At September 30, 2013, we had an accumulated deficit of approximately $307.3 million. |
Significant_Accounting_Policie
Significant Accounting Policies | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Accounting Policies [Abstract] | ' | ||||||||
Significant Accounting Policies | ' | ||||||||
Note 3. Significant Accounting Policies | |||||||||
Principles of Consolidation | |||||||||
The accompanying condensed consolidated financial statements include the accounts of the HeartWare Group. All inter-company balances and transactions have been eliminated in consolidation. We hold certain investments in small privately-held development-stage entities which are included in other assets on our condensed consolidated balance sheets. In accordance with FASB ASC 810, we analyzed the investments to determine whether the investments are variable interests or interests that give us a controlling financial interest in a variable interest entity (“VIE”). As of September 30, 2013, we determined there were no VIEs required to be consolidated, because we are not the primary beneficiary, as we do not have the power to direct the most meaningful activities of the VIE. Investments where we do not exercise operating and financial control are accounted for under the equity method or cost method depending on our ownership interest. | |||||||||
Accounting Estimates | |||||||||
The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from those estimates. Our most critical accounting policies and estimates include: revenue recognition, inventory capitalization and valuation, accounting for share-based compensation, measurement of fair value, and the valuation of tax assets and liabilities. | |||||||||
Cash and Cash Equivalents | |||||||||
Cash and cash equivalents are recorded on our condensed consolidated balance sheets at cost, which approximates fair value. All highly liquid investments with an original maturity of three months or less at the date of purchase are considered to be cash equivalents. | |||||||||
Investments | |||||||||
Our investments classified as available-for-sale are stated at fair value with unrealized gains and losses reported in accumulated other comprehensive loss within stockholders’ equity. We classify our available-for-sale investments as short-term if their remaining time to maturity at purchase is beyond three months, but less than twenty-four months. Investments with maturities at purchase beyond one year, but less than twenty-four months, may be classified as short-term based on their highly liquid nature and because these marketable securities represent the investment of cash that is available for current operations. Interest on investments classified as available-for-sale is included in investment income, net. Premiums paid on our short-term investments are amortized over the remaining term of the investment and the amortization is included in investment income, net. | |||||||||
Receivables | |||||||||
Accounts receivable consists of amounts due from the sale of our HeartWare® Ventricular Assist System (the “HeartWare System”) to our customers, which include hospitals, health research institutions and medical device distributors. We grant credit to customers in the normal course of business, but generally do not require collateral or any other security to support credit sales. Our receivables are geographically dispersed, with a significant portion from customers located in Europe and other foreign countries. At September 30, 2013, one customer had an accounts receivable balance greater than 10% of total accounts receivable representing approximately 13% of our total accounts receivable. At December 31, 2012, no customer had an accounts receivable balance greater than 10% of our total accounts receivable. | |||||||||
We maintain allowances for doubtful accounts for estimated losses that may result from an inability to collect payments owed to us for product sales. We regularly review the allowance by considering factors such as historical experience, the age of the accounts receivable balances and local economic conditions that may affect a customer’s ability to pay. Account balances are charged off against the allowance after appropriate collection efforts have been exhausted and we feel it is probable that the receivable will not be recovered. | |||||||||
The following table summarizes the change in our allowance for doubtful accounts for the nine months ended September 30, 2013 and 2012: | |||||||||
2013 | 2012 | ||||||||
(in thousands) | |||||||||
Beginning balance | $ | 750 | $ | 500 | |||||
(Reversals) charges to expense | (206 | ) | 250 | ||||||
Charge-offs | — | — | |||||||
Ending balance | $ | 544 | $ | 750 | |||||
As of September 30, 2013 and December 31, 2012, we did not have an allowance for returns. | |||||||||
Inventories | |||||||||
Inventories are stated at the lower of cost or market. Cost is determined using a first-in, first-out, or FIFO, method. Work-in-process and finished goods manufactured or assembled by us include direct and indirect labor and manufacturing overhead. Finished goods include product which is ready-for-use and which is held by us or by our customers on a consignment basis. | |||||||||
We review our inventory for excess or obsolete inventory and write-down obsolete or otherwise unmarketable inventory to its estimated net realizable value. Obsolescence may occur due to product expiring or product improvements rendering previous versions obsolete. | |||||||||
Deferred Financing Costs | |||||||||
Costs incurred in connection with the issuance of our convertible senior notes have been allocated between the liability component and the equity component as further discussed in Note 10 (Debt). The issuance costs allocated to the convertible senior notes were capitalized within deferred financing costs, net on our condensed consolidated balance sheets. These costs are being amortized using the effective interest method through December 15, 2017, the maturity date of the notes, and the amortization expense is reflected in interest expense on our condensed consolidated statements of operations. The amount of amortization for the three months ended September 30, 2013 and 2012 was approximately $0.1 million for each period. The amount of amortization for the nine months ended September 30, 2013 and 2012 was approximately $0.3 million and $0.2 million, respectively. The amount of accumulated amortization at September 30, 2013 and December 31, 2012 was approximately $0.9 million and $0.6 million, respectively. | |||||||||
Product Warranty | |||||||||
Certain patient accessories sold with the HeartWare System are covered by a limited warranty ranging from one to two years. Estimated contractual warranty obligations are recorded as an expense when the related revenue is recognized and are included in cost of revenue on our condensed consolidated statements of operations. Factors that affect estimated warranty liability include the number of units sold, historical and anticipated rates of warranty claims, cost per claim, and vendor supported warranty programs. We periodically assess the adequacy of our recorded warranty liabilities and adjust the amounts as necessary. | |||||||||
The amount of the liability recorded is equal to the estimated costs to repair or otherwise satisfy claims made by customers. Accrued warranty expense is included as a component of other accrued liabilities on our condensed consolidated balance sheets. | |||||||||
The costs to repair or replace products associated with product recalls and voluntary service campaigns are recorded when they are determined to be probable and reasonably estimable as a cost of revenue and are not included in product warranty liability. No such costs were incurred in the three and nine months ended September 30, 2013 and 2012. | |||||||||
The following table summarizes the change in our warranty liability for the nine months ended September 30, 2013 and 2012: | |||||||||
2013 | 2012 | ||||||||
(in thousands) | |||||||||
Beginning balance | $ | 543 | $ | 203 | |||||
Accrual for warranty expense | 856 | 668 | |||||||
Warranty costs incurred during the period | (345 | ) | (453 | ) | |||||
Ending balance | $ | 1,054 | $ | 418 | |||||
Leases | |||||||||
We lease all of our administrative and manufacturing facilities. We recognize rent expense on a straight-line basis over the terms of our leases. Any scheduled rent increases, rent holidays and other related incentives are recognized on a straight-line basis over the terms of the leases. The difference between the cash rental payments and the straight-line recognition of rent expense over the terms of the leases results in a deferred rent asset or liability. As of September 30, 2013, the long-term portion of our deferred rent liability of approximately $2.6 million is included in other long-term liabilities on our condensed consolidated balance sheets. | |||||||||
Fair Value Measurements | |||||||||
The carrying amounts reported on our condensed consolidated balance sheets for cash and cash equivalents, accounts receivable, accounts payable and other accrued liabilities approximate their fair value based on the short-term maturity of these instruments. Investments are considered available-for-sale as of September 30, 2013 and December 31, 2012 and are carried at fair value. See Note 4 (Fair Value Measurements) and Note 10 (Debt) for more information. | |||||||||
Vendor Concentration | |||||||||
For the three and nine months ended September 30, 2013, we purchased approximately 69% and 68%, respectively, of our inventory components and supplies from three vendors. For the three and nine months ended September 30, 2012, we purchased approximately 57% and 66%, respectively, of our inventory components and supplies from the same three vendors. In addition, one of these vendors provides consulting services and material used in research and development activities. As of September 30, 2013 and 2012, the amounts due to these vendors totaled approximately $3.2 million and $2.9 million, respectively. | |||||||||
We purchase certain important components of the HeartWare System from single-source suppliers. We cannot guarantee that we can secure alternative suppliers that could provide similar components on comparable terms and consistent with regulatory requirements. A change in suppliers could cause a delay in manufacturing and a possible loss of product sales or result in higher component costs, all of which would have a negative effect on our results of operations. | |||||||||
Concentration of Credit Risk and other Risks and Uncertainties | |||||||||
Financial instruments that potentially expose us to concentrations of credit risk consist primarily of cash and cash equivalents, investments and trade accounts receivable. Cash and cash equivalents are primarily on deposit with financial institutions in the United States and these deposits generally exceed the amount of insurance provided by the Federal Deposit Insurance Corporation (the “FDIC”). The Company has not experienced any historical losses on its deposits of cash and cash equivalents. Our investments consist of investment grade rated corporate and government agency debt and time deposits. | |||||||||
Concentration of credit risk with respect to our trade accounts receivable from our customers is primarily limited to hospitals, health research institutions and medical device distributors. Credit is extended to our customers, based on an evaluation of a customer’s financial condition and collateral is generally not required. | |||||||||
We are subject to certain risks and uncertainties including, but not limited to, our ability to achieve profitability, to generate cash flow sufficient to satisfy our indebtedness, to run clinical trials in order to receive and maintain FDA and foreign regulatory approvals for our products, to achieve widespread acceptance of our products, to manufacture our products in a sufficient volume and at a reasonable cost, and to protect our proprietary technologies and develop new products as well as risks associated with operating in foreign countries, and general competitive and economic conditions. Changes in any of the preceding areas could have a material adverse effect on our business, results of operations or financial position. | |||||||||
New Accounting Standards | |||||||||
In September 2012, the FASB issued ASU No. 2012-02, Intangibles – Goodwill and Other (Topic 350), Testing Indefinite-Lived Intangible Assets for Impairment, which provides an entity the option first to assess qualitative factors to determine whether the existence of events and circumstances indicates that it is more likely than not that an indefinite-lived intangible asset is impaired. If, after assessing the totality of events and circumstances, an entity concludes that it is not more likely than not that the indefinite-lived intangible asset is impaired, then the entity is not required to take further action. The qualitative assessment is optional, allowing companies to go directly to the quantitative assessment. ASU No. 2012-02 is effective for our annual and interim impairment tests performed subsequent to January 1, 2013. The adoption of ASU No. 2012-02 did not affect our consolidated financial position, results of operations or cash flows. | |||||||||
In July 2013, the FASB issued ASU No. 2013-11, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (a consensus of the FASB Emerging Issues Task Force). U.S. GAAP does not include explicit guidance on the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. The amendments in this ASU state that an unrecognized tax benefit, or a portion of an unrecognized tax benefit, should be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward, except as follows: To the extent a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available at the reporting date under the tax law of the applicable jurisdiction to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. This ASU applies to all entities that have unrecognized tax benefits when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists at the reporting date. The amendments in this ASU are effective for fiscal years, and interim periods within those years, beginning after December 15, 2013, with early adoption permitted. The amendments should be applied prospectively to all unrecognized tax benefits that exist at the effective date, although retrospective application is permitted. We plan to adopt ASU No. 2013-11 effective January 1, 2014. The adoption of ASU No. 2013-11 is not expected to have a material effect on our consolidated financial position, results of operations or cash flows. |
Fair_Value_Measurements
Fair Value Measurements | 9 Months Ended | ||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||||||||||
Fair Value Measurements | ' | ||||||||||||||||||||||||
Note 4. Fair Value Measurements | |||||||||||||||||||||||||
FASB ASC 820 – Fair Value Measurements and Disclosures, defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. FASB ASC 820 requires disclosures about the fair value of all financial instruments, whether or not recognized, for financial statement purposes. Disclosures about the fair value of financial instruments are based on pertinent information available to us as of the reporting dates. Accordingly, the estimates presented in the accompanying condensed consolidated financial statements are not necessarily indicative of the amounts that could be realized on disposition of the financial instruments. | |||||||||||||||||||||||||
FASB ASC 820 specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect market assumptions. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). | |||||||||||||||||||||||||
The three levels of the fair value hierarchy are as follows: | |||||||||||||||||||||||||
Level 1 – Quoted prices for identical instruments in active markets. | |||||||||||||||||||||||||
Level 2 – Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable. | |||||||||||||||||||||||||
Level 3 – Instruments with primarily unobservable value drivers. | |||||||||||||||||||||||||
The following table represents the fair value of our financial assets and financial liabilities measured at fair value on a recurring basis and which level was used in the fair value hierarchy. | |||||||||||||||||||||||||
At September 30, 2013 | |||||||||||||||||||||||||
Fair Value Measurements at the Reporting Date Using | |||||||||||||||||||||||||
Carrying | Fair | Level 1 | Level 2 | Level 3 | |||||||||||||||||||||
Value | Value | ||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||
Short-term investments | $ | 35,875 | $ | 35,875 | $ | — | $ | 35,875 | $ | — | |||||||||||||||
Long-term investments | 1,225 | 1,225 | — | 1,225 | — | ||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||
Convertible senior notes | 105,345 | (1 | ) | 160,281 | — | 160,281 | — | ||||||||||||||||||
Royalties | 981 | (2 | ) | 981 | — | — | 981 | ||||||||||||||||||
At December 31, 2012 | |||||||||||||||||||||||||
Fair Value Measurements at the Reporting Date Using | |||||||||||||||||||||||||
Carrying | Fair | Level 1 | Level 2 | Level 3 | |||||||||||||||||||||
Value | Value | ||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||
Short-term investments | $ | 16,887 | $ | 16,887 | $ | — | $ | 16,887 | $ | — | |||||||||||||||
Liabilities | |||||||||||||||||||||||||
Convertible senior notes | 100,315 | (1 | ) | 169,122 | — | 169,122 | — | ||||||||||||||||||
Royalties | 1,113 | (2 | ) | 1,113 | — | — | 1,113 | ||||||||||||||||||
-1 | The carrying amount of our convertible senior notes is net of unamortized discount. See Note 10 (Debt) for more information. | ||||||||||||||||||||||||
-2 | Royalties represent the fair value of future royalty payments to be made pursuant to agreements related to intellectual property licensed or acquired by World Heart to be paid over the next 3 to 17 years. | ||||||||||||||||||||||||
The fair value of our investments and convertible senior notes was determined using quoted prices (including trade data) for the instruments in markets that are not active. The fair value of our convertible senior notes is presented for disclosure purposes only. | |||||||||||||||||||||||||
Financial assets and liabilities are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies, or similar techniques, and at least one significant model assumption or input is unobservable. At September 30, 2013 and December 31, 2012, our financial liability categorized as Level 3 consisted of royalty payment obligations due under contractual arrangements related to our acquisition of World Heart in August 2012, because the fair value includes significant management judgment or estimation. The royalty payment obligations were valued using a discounted cash flow model, the future minimum royalty payment amounts and discount rates commensurate with our market risk and the terms of the obligations. | |||||||||||||||||||||||||
The following table summarizes the change in fair value, as determined by Level 3 inputs, of the royalty payment obligations for the nine months ended September 30, 2013: | |||||||||||||||||||||||||
Royalties | |||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||
Beginning balance | $ | 1,113 | |||||||||||||||||||||||
Payments | (185 | ) | |||||||||||||||||||||||
Change in fair value | 53 | ||||||||||||||||||||||||
Ending balance | $ | 981 | |||||||||||||||||||||||
The loss associated with the change in fair value of the royalty payment obligations is included in research and development expenses on our condensed consolidated statements of operations. | |||||||||||||||||||||||||
Assets That Are Measured at Fair Value on a Nonrecurring Basis | |||||||||||||||||||||||||
Non-financial assets such as intangible assets, goodwill and property, plant, and equipment are evaluated for impairment annually or when indicators of impairment exist. No impairment was recorded for the three and nine months ended September 30, 2013 and 2012. Non-financial assets such as identified intangibles acquired in connection with our acquisition of World Heart in August 2012 are measured at fair value using Level 3 inputs, which include discounted cash flow methodologies or similar techniques, when there is limited market activity and the determination of fair value requires significant judgment or estimation. | |||||||||||||||||||||||||
Investments
Investments | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Investments Debt And Equity Securities [Abstract] | ' | ||||||||||||||||
Investments | ' | ||||||||||||||||
Note 5. Investments | |||||||||||||||||
We have cash investment policies that limit investments to investment grade rated securities. At September 30, 2013 and December 31, 2012, all of our investments were classified as available-for-sale and carried at fair value. At September 30, 2013, our short-term investments had maturity dates of less than twenty-four months, while our long-term investments matured beyond twenty-four months, but within thirty-nine months. | |||||||||||||||||
The amortized cost and fair value of our investments, with gross unrealized gains and losses, were as follows: | |||||||||||||||||
At September 30, 2013 | |||||||||||||||||
Amortized | Gross | Gross | Aggregate | ||||||||||||||
Cost Basis | Unrealized | Unrealized | Fair Value | ||||||||||||||
Gains | Losses | ||||||||||||||||
(in thousands) | |||||||||||||||||
Short-term investments: | |||||||||||||||||
Corporate debt | $ | 29,824 | $ | — | $ | (29 | ) | $ | 29,795 | ||||||||
Certificates of deposit | 6,080 | — | — | 6,080 | |||||||||||||
Total short-term investments | $ | 35,904 | $ | — | $ | (29 | ) | $ | 35,875 | ||||||||
Long-term investments: | |||||||||||||||||
Certificates of deposit | $ | 1,225 | $ | — | $ | — | $ | 1,225 | |||||||||
Total long-term investments | $ | 1,225 | $ | — | $ | — | $ | 1,225 | |||||||||
At December 31, 2012 | |||||||||||||||||
Amortized | Gross | Gross | Aggregate | ||||||||||||||
Cost Basis | Unrealized | Unrealized | Fair Value | ||||||||||||||
Gains | Losses | ||||||||||||||||
(in thousands) | |||||||||||||||||
Short-term investments: | |||||||||||||||||
Corporate debt | $ | 10,565 | $ | — | $ | (25 | ) | $ | 10,540 | ||||||||
Certificates of deposit | 6,346 | 1 | — | 6,347 | |||||||||||||
Total short-term investments | $ | 16,911 | $ | 1 | $ | (25 | ) | $ | 16,887 | ||||||||
For the three and nine months ended September 30, 2013 and 2012, we did not have any realized gains or losses on our investments. At September 30, 2013 and December 31, 2012, none of our available-for-sale investments had been in a continuous loss position for more than twelve months. |
Inventories
Inventories | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Inventory Disclosure [Abstract] | ' | ||||||||
Inventories | ' | ||||||||
Note 6. Inventories | |||||||||
Components of inventories are as follows: | |||||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
(in thousands) | |||||||||
Raw material | $ | 19,398 | $ | 11,192 | |||||
Work-in-process | 8,519 | 11,123 | |||||||
Finished goods | 9,966 | 16,128 | |||||||
$ | 37,883 | $ | 38,443 | ||||||
Finished goods inventories includes inventory held on consignment at customer sites of approximately $4.9 million and $5.5 million at September 30, 2013 and December 31, 2012, respectively. |
Property_Plant_and_Equipment_N
Property, Plant and Equipment, Net | 9 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Property Plant And Equipment [Abstract] | ' | ||||||||||||
Property, Plant and Equipment, Net | ' | ||||||||||||
Note 7. Property, Plant and Equipment, Net | |||||||||||||
Property, plant and equipment, net consists of the following: | |||||||||||||
Estimated | September 30, | December 31, | |||||||||||
Useful Lives | 2013 | 2012 | |||||||||||
(in thousands) | |||||||||||||
Machinery and equipment | 1.5 to 7 years | $ | 17,556 | $ | 17,894 | ||||||||
Leasehold improvements | 3 to 10 years | 6,283 | 8,082 | ||||||||||
Office equipment, furniture and fixtures | 5 to 7 years | 1,035 | 912 | ||||||||||
Purchased software | 1 to 7 years | 4,643 | 3,572 | ||||||||||
29,517 | 30,460 | ||||||||||||
Less: accumulated depreciation | (13,205 | ) | (11,080 | ) | |||||||||
$ | 16,312 | $ | 19,380 | ||||||||||
During the quarter ended September 30, 2013, we ceased certain development activities performed in our Australian facility, and relocated those activities to the United States. We sold a portion of the fixed assets at our Australian facility while others were written-off upon their discontinued use. The aggregate loss on disposal of fixed assets sold or written-off in the third quarter of 2013 in connection with this action was $0.5 million. This amount is included in research and development expenses on our condensed consolidated statements of operations. |
Goodwill_and_Intangible_Assets
Goodwill and Intangible Assets, Net | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Goodwill And Intangible Assets Disclosure [Abstract] | ' | ||||||||||||||||
Goodwill and Intangible Assets, Net | ' | ||||||||||||||||
Note 8. Goodwill and Intangible Assets, Net | |||||||||||||||||
In August 2012, we acquired World Heart and recorded $1.2 million of goodwill. Goodwill is not amortized but will be reviewed for impairment on an annual basis starting in the fourth quarter of 2013 or sooner if indicators of impairment arise. | |||||||||||||||||
The gross carrying amount of amortizable intangible assets and the related accumulated amortization for intangible assets are as follows: | |||||||||||||||||
September 30, 2013 | December 31, 2012 | ||||||||||||||||
Gross Carrying | Accumulated | Gross Carrying | Accumulated | ||||||||||||||
Amount | Amortization | Amount | Amortization | ||||||||||||||
(in thousands) | |||||||||||||||||
Patents | $ | 6,449 | $ | (981 | ) | $ | 5,865 | $ | (606 | ) | |||||||
Patents are being amortized using the straight-line method over their estimated useful lives, which range from 8 to 16 years. Amortization expense for the three months ended September 30, 2013 and 2012 was approximately $129,000 and $43,000, respectively. Amortization expense for the nine months ended September 30, 2013 and 2012 was approximately $375,000 and $123,000, respectively. | |||||||||||||||||
We recognized approximately $2.5 million of in-process research and development in connection with our acquisition of World Heart in August 2012. In-process research and development has an indefinite life. At the time the economic life becomes determinable (upon project completion or abandonment) the amount will be amortized over its expected remaining life. |
Other_Accrued_Liabilities
Other Accrued Liabilities | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Text Block [Abstract] | ' | ||||||||
Other Accrued Liabilities | ' | ||||||||
Note 9. Other Accrued Liabilities | |||||||||
Other accrued liabilities consist of the following: | |||||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
(in thousands) | |||||||||
Accrued payroll and other employee costs | $ | 9,240 | $ | 8,818 | |||||
Accrued material purchases | 3,495 | 5,628 | |||||||
Accrued professional fees | 3,037 | 1,340 | |||||||
Accrued research and development costs | 2,071 | 3,132 | |||||||
Accrued interest payable | 1,482 | 211 | |||||||
Accrued VAT | 2,253 | 1,212 | |||||||
Other accrued expenses | 4,116 | 1,679 | |||||||
$ | 25,694 | $ | 22,020 | ||||||
Accrued payroll and other employee costs included estimated year-end employee bonuses of approximately $4.6 million and $5.9 million at September 30, 2013 and December 31, 2012, respectively. |
Debt
Debt | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Debt Disclosure [Abstract] | ' | ||||||||||||||||
Debt | ' | ||||||||||||||||
Note 10. Debt | |||||||||||||||||
On December 15, 2010, we completed the sale of 3.5% convertible senior notes due 2017 (the “Convertible Notes”) for an aggregate principal amount of $143.75 million pursuant to the terms of an Indenture dated December 15, 2010 (the “Indenture”). The Convertible Notes are the senior unsecured obligations of the Company. The Convertible Notes bear interest at a rate of 3.5% per annum, payable semi-annually in arrears on June 15 and December 15 of each year. The Convertible Notes will mature on December 15, 2017, unless earlier repurchased by us or converted. | |||||||||||||||||
The Convertible Notes offering was completed pursuant to a prospectus supplement, dated December 9, 2010, to a shelf registration statement on Form S-3 that was previously filed with the SEC and which was declared effective on December 9, 2010. | |||||||||||||||||
The Convertible Notes will be convertible at an initial conversion rate of 10 shares of our common stock per $1,000 principal amount of Convertible Notes, which corresponds to an initial conversion price of $100.00 per share of our common stock. The conversion rate is subject to adjustment from time to time upon the occurrence of certain events. | |||||||||||||||||
Prior to June 15, 2017, holders may convert their Convertible Notes at their option only upon satisfaction of one or more of the conditions specified in the Indenture relating to the (i) sale price of our common stock, (ii) the trading price per $1,000 principal amount of Convertible Notes or (iii) specified corporate events. As of the date of this report, none of the events that would allow holders to convert their Convertible Notes have occurred. On or after June 15, 2017, until the close of business of the business day immediately preceding the date the Convertible Notes mature, holders may convert their Convertible Notes at any time, regardless of whether any of the foregoing conditions have been met. Upon conversion, we will pay or deliver, as the case may be, cash, shares of our common stock or a combination thereof, at our election. | |||||||||||||||||
We may not redeem the Convertible Notes prior to maturity. Holders of the Convertible Notes may require us to purchase for cash all or a part of their Convertible Notes at a repurchase price equal to 100% of the principal amount of the Convertible Notes to be repurchased, plus accrued and unpaid interest, upon the occurrence of certain fundamental changes (as defined in the Indenture) involving the Company. The Indenture does not contain any financial or operating covenants or restrictions on the payments of dividends, the incurrence of indebtedness or the issuance or repurchase of securities by us or any of our subsidiaries. | |||||||||||||||||
The Indenture contains customary terms and nonfinancial covenants and defines events of default. If an event of default (other than certain events of bankruptcy, insolvency or reorganization) involving the Company occurs and is continuing, the Trustee (by notice to the Company) or the holders of at least 25% in principal amount of the outstanding Convertible Notes (by notice to the Company and the Trustee) may declare 100% of the principal of and accrued and unpaid interest, if any, on all the Convertible Notes to be due and payable. In case of certain events of bankruptcy, insolvency or reorganization, involving the Company, 100% of the principal of and accrued and unpaid interest on the Convertible Notes will automatically become due and payable. Notwithstanding the foregoing, the Indenture provides that, to the extent we elect, the sole remedy for an event of default relating to certain failures by us to comply with certain reporting covenants in the Indenture consists exclusively of the right to receive additional interest on the Convertible Notes. | |||||||||||||||||
In accordance with FASB ASC 470-20, Debt with Conversion and Other Options, which applies to certain convertible debt instruments that may be settled in cash or other assets, or partially in cash, upon conversion, we recorded the long-term debt and equity components on our Convertible Notes separately on the issuance date. The amount recorded for long-term debt was determined by measuring the fair value of a similar liability that does not have an associated equity component. The measurement of fair value required the Company to make estimates and assumptions to determine the present value of the cash flows of the Convertible Notes, absent the conversion feature. This treatment increased interest expense associated with our Convertible Notes by adding a non-cash component to interest expense in the form of amortization of a debt discount calculated based on the difference between the 3.5% cash coupon rate and the effective interest rate on debt borrowing of approximately 12.5%. The discount is being amortized to interest expense through the December 15, 2017 maturity date of the Convertible Notes using the effective interest method and is included in interest expense on our condensed consolidated statements of operations. Additionally, we allocated the costs related to issuance of the Convertible Notes on the same percentage as the long-term debt and equity components, such that a portion of the costs is allocated to the long-term debt component and the equity component included in additional paid-in capital. The portion of the costs allocated to the long-term debt component is presented as deferred financing costs, net on our condensed consolidated balance sheets. These deferred financing costs are also being amortized to interest expense through the December 15, 2017 maturity date of the Convertible Notes using the effective interest method and the amortization is included in interest expense on our condensed consolidated statements of operations. | |||||||||||||||||
The Convertible Notes and the equity component, which is recorded in additional paid-in-capital, consisted of the following: | |||||||||||||||||
September 30, | December 31, | ||||||||||||||||
2013 | 2012 | ||||||||||||||||
(in thousands) | |||||||||||||||||
Principal amount | $ | 143,750 | $ | 143,750 | |||||||||||||
Unamortized discount | (38,405 | ) | (43,435 | ) | |||||||||||||
Net carrying amount | $ | 105,345 | $ | 100,315 | |||||||||||||
Equity component | $ | 55,038 | $ | 55,038 | |||||||||||||
Based on the initial conversion rate of 10 shares of our common stock per $1,000 principal amount of Convertible Notes, which corresponds to an initial conversion price of $100.00 per share of our common stock, the number of shares issuable upon conversion of the Convertible Notes is 1,437,500. The value of these shares, based on the closing price of our common stock on September 30, 2013 of $73.19 per share, was approximately $105.2 million. The fair value of our Convertible Notes as presented in Note 4 was $160.3 million at September 30, 2013. | |||||||||||||||||
Interest expense related to the Convertible Notes consisted of interest due on the principal amount, amortization of the discount and amortization of the portion of the deferred financing costs allocated to the long-term debt component. For the three and nine months ended September 30, 2013 and 2012, interest expense related to the Convertible Notes was as follows: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
(in thousands) | |||||||||||||||||
Stated amount at 3.5% coupon rate | $ | 1,258 | $ | 1,258 | $ | 3,774 | $ | 3,774 | |||||||||
Amortization of discount | 1,727 | 1,532 | 5,030 | 4,460 | |||||||||||||
Amortization of deferred financing costs | 93 | 82 | 270 | 239 | |||||||||||||
$ | 3,078 | $ | 2,872 | $ | 9,074 | $ | 8,473 | ||||||||||
Stockholders_Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2013 | |
Equity [Abstract] | ' |
Stockholders' Equity | ' |
Note 11. Stockholders’ Equity | |
On March 12, 2013, we entered into an Underwriting Agreement (the “Underwriting Agreement”) with J.P. Morgan Securities LLC, as representative of the several underwriters named in the Underwriting Agreement (the “Underwriters”), pursuant to which we agreed to sell and the Underwriters agreed to purchase, subject to and upon terms and conditions set forth therein, an aggregate of 1,500,000 shares of our common stock at a net sales price of $81.9114 per share (the public offering price of $86.45 per share minus the underwriting discount). We also granted the Underwriters an option to purchase 225,000 additional shares of our common stock at the public offering price less the underwriting discount, which the Underwriters exercised in full on March 13, 2013. The closing of the offering occurred on March 18, 2013. After fees and related expenses, net proceeds from the offering were approximately $141.0 million. | |
The offering was completed pursuant to a prospectus supplement, dated March 12, 2013, to a shelf registration statement on Form S-3 that was previously filed with the SEC and which was declared effective on December 9, 2010. This shelf registration statement allows us to offer and sell from time to time, in one or more series or issuances and on terms that we determine at the time of the offering, any combination and amount of the securities described in the prospectus contained in the registration statement. | |
In the nine months ended September 30, 2013, we issued an aggregate of 119,654 shares of our common stock upon the exercise of stock options and an aggregate of 31,676 shares of our common stock upon the vesting of restricted stock units. | |
In the nine months ended September 30, 2012, we issued 82,532 shares of our common stock in connection with the acquisition of World Heart. We also issued an aggregate of 65,808 shares of our common stock upon the exercise of stock options and an aggregate of 160,830 shares of our common stock upon the vesting of restricted stock units. |
ShareBased_Compensation
Share-Based Compensation | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ' | ||||||||||||||||
Share-Based Compensation | ' | ||||||||||||||||
Note 12. Share-Based Compensation | |||||||||||||||||
We recognize share-based compensation expense related to our stock options and restricted stock units (“RSUs”) based on the estimated fair value of the awards on the date of the grant, net of estimated forfeitures, using an accelerated accrual method over the vesting period. Vesting of share-based awards issued with performance-based vesting criteria must be probable before we begin recording share-based compensation expense. At each reporting period, we review the likelihood that these awards will vest and if vesting is deemed probable, we begin to recognize compensation expense at that time. If ultimately performance goals are not met, for any awards where vesting was previously deemed probable, previously recognized compensation expense will be reversed. | |||||||||||||||||
We allocate share-based compensation expense to cost of revenue, selling, general and administrative expense and research and development expense based on the award holder’s employment function. For the three and nine months ended September 30, 2013 and 2012, we recorded share-based compensation expense as follows: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
(In thousands) | |||||||||||||||||
Cost of revenue | $ | 828 | $ | 698 | $ | 1,970 | $ | 2,451 | |||||||||
Selling, general and administrative | 3,951 | 2,746 | 9,169 | 8,234 | |||||||||||||
Research and development | 2,286 | 1,449 | 5,303 | 4,262 | |||||||||||||
$ | 7,065 | $ | 4,893 | $ | 16,442 | $ | 14,947 | ||||||||||
The increase in share-based compensation expense for the three and nine months ended September 30, 2013, compared to the same periods of 2012, is primarily due to a reduction in our estimated forfeiture rate in the third quarter of 2013. | |||||||||||||||||
Deferred tax benefits attributed to our share-based compensation expense are not recognized in the accompanying condensed consolidated financial statements because we are in a net operating loss position and a full valuation allowance is maintained for all net deferred tax assets. We receive a tax deduction for certain stock option exercises during the period the options are exercised, and for the vesting of restricted stock units during the period the restricted stock units vest. For stock options, the amount of the tax deduction is generally the excess of the fair market value of our shares of common stock over the exercise price of the stock options at the date of exercise. For restricted stock units, the amount of the tax deduction is generally the fair market value of our shares of common stock at the vesting date. Excess tax benefits are not recognized in the accompanying condensed consolidated financial statements because we are in a net operating loss position and we do not currently realize a benefit from the deduction. | |||||||||||||||||
Equity Plans | |||||||||||||||||
We have issued share-based awards to employees, non-executive directors and outside consultants through various approved plans and outside of any formal plan. New shares are issued upon the exercise of share-based awards. | |||||||||||||||||
Upon receipt of stockholder approval on May 31, 2012, we adopted the HeartWare International, Inc. 2012 Incentive Award Plan (“2012 Plan”). The 2012 Plan provides for the grant of incentive stock options, non-qualified stock options, restricted stock, restricted stock units, performance awards, dividend equivalent rights, deferred stock, deferred stock units, stock payments and stock appreciation rights (collectively referred to as “Awards”), to our directors, employees and consultants. Under the terms of the 2012 Plan, the total number of shares of our common stock initially reserved for issuance under Awards is 1,375,000, provided that the total number of shares of our common stock that may be issued pursuant to “Full Value Awards” (Awards other than options, SARs or other Awards for which the holder pays the intrinsic value existing as of the date of grant whether directly or by forgoing a right to receive a payment from the Company) is 1,275,000. As of September 30, 2013, 6,638 shares have been issued upon vesting of Awards issued under the 2012 Plan and Awards with respect to 301,812 shares were issued and outstanding under the 2012 Plan. Subsequent to adoption of the 2012 Plan, no new Awards will be granted under our prior plans. Any outstanding Awards under the prior plans will continue to be subject to the terms and conditions of the plan under which they were granted. | |||||||||||||||||
Stock Options | |||||||||||||||||
Each option allows the holder to subscribe for and be issued one share of our common stock at a specified price, which is generally the quoted market price of our common stock on the date the option is issued. Options generally vest on a pro-rata basis on each anniversary of the issuance date within four years of the date the option is issued. Options may be exercised after they have vested and prior to the specified expiry date provided applicable exercise conditions are met, if any. The expiry date can be for periods of up to ten years from the date the option is issued. | |||||||||||||||||
The fair value of each option is estimated on the date of grant using the Black-Scholes option pricing model based on the assumptions established at that time. No options were issued in the three months ended September 30, 2013 and 2012. The following table includes the weighted average assumptions used for options issued in the nine months ended September 30, 2013 and 2012. | |||||||||||||||||
Nine Months Ended | |||||||||||||||||
September 30, | |||||||||||||||||
2013 | 2012 | ||||||||||||||||
Dividend yield | 0 | % | 0 | % | |||||||||||||
Expected volatility | 40 | % | 57 | % | |||||||||||||
Risk-free interest rate | 1.15 | % | 1 | % | |||||||||||||
Estimated holding period (years) | 6.25 | 6.25 | |||||||||||||||
Information related to options granted under all of our plans at September 30, 2013 and activity in the nine months then ended is as follows (certain amounts in U.S.$ were converted from AU$ at the then period-end spot rate): | |||||||||||||||||
Number of | Weighted | Weighted | Aggregate | ||||||||||||||
Options | Average | Average | Intrinsic | ||||||||||||||
(in thousands) | Exercise | Remaining | Value | ||||||||||||||
Price | Contractual Life | (in thousands) | |||||||||||||||
(Years) | |||||||||||||||||
Outstanding at December 31, 2012 | 291 | $ | 36.7 | ||||||||||||||
Granted | 7 | 95.05 | |||||||||||||||
Exercised | (120 | ) | 28.23 | ||||||||||||||
Forfeited | — | — | |||||||||||||||
Expired | — | — | |||||||||||||||
Outstanding at September 30, 2013 | 178 | $ | 40.88 | 4.65 | $ | 6,032 | |||||||||||
Exercisable at September 30, 2013 | 150 | $ | 34.71 | 4.01 | $ | 5,806 | |||||||||||
The aggregate intrinsic values at September 30, 2013 noted in the table above represent the number of in-the-money options outstanding or exercisable multiplied by the closing price of our common stock traded on NASDAQ less the weighted average exercise price at period end. | |||||||||||||||||
The weighted average grant date fair value per share of options issued in the nine months ended September 30, 2013 and 2012 was $38.51 and $43.83 per share, respectively. | |||||||||||||||||
The total intrinsic value of options exercised in the nine months ended September 30, 2013 and 2012 was approximately $7.7 million and $3.3 million, respectively. Cash received from options exercised in the nine months ended September 30, 2013 and 2012 was approximately $3.4 million and $2.3 million, respectively. | |||||||||||||||||
At September 30, 2013, there was approximately $0.4 million of unrecognized compensation expense, net of estimated forfeitures, related to non-vested options. This expense is expected to be recognized over a weighted average period of 1.3 years. | |||||||||||||||||
Restricted Stock Units | |||||||||||||||||
Each RSU represents a contingent right to receive one share of our common stock. RSUs generally vest on a pro-rata basis on each anniversary of the issuance date over three or four years or vest in accordance with performance-based criteria. The RSUs with performance-based vesting criteria vest in one or more tranches contingent upon the achievement of pre-determined milestones related to the development of our products, the achievement of certain prescribed clinical and regulatory objectives, the achievement of specific financial performance measures or similar multi-year metrics. There is no consideration payable on the vesting or exercise of RSUs issued under the plans. Upon vesting, the RSUs are exercised automatically and settled in shares of our common stock. | |||||||||||||||||
Information related to RSUs at September 30, 2013 and activity in the nine months then ended is as follows: | |||||||||||||||||
Number of | Weighted | Aggregate | |||||||||||||||
Units | Average | Intrinsic | |||||||||||||||
(in thousands) | Remaining | Value | |||||||||||||||
Contractual Life | (in thousands) | ||||||||||||||||
(Years) | |||||||||||||||||
Outstanding at December 31, 2012 | 547 | ||||||||||||||||
Granted | 108 | ||||||||||||||||
Vested/Exercised | (31 | ) | |||||||||||||||
Forfeited | (15 | ) | |||||||||||||||
Expired | — | ||||||||||||||||
Outstanding at September 30, 2013 | 609 | 1.63 | $ | 44,560 | |||||||||||||
Exercisable at September 30, 2013 | — | — | $ | — | |||||||||||||
The aggregate intrinsic value at September 30, 2013 noted in the table above represents the closing price of our common stock traded on NASDAQ multiplied by the number of RSUs outstanding. | |||||||||||||||||
At September 30, 2013, 16,700 of the RSUs outstanding are subject to performance-based vesting criteria as described above. | |||||||||||||||||
The total intrinsic value of RSUs vested in the nine months ended September 30, 2013 and 2012 was approximately $2.9 million and $14.3 million, respectively. | |||||||||||||||||
The fair value of each RSU award equals the closing price of our common stock on the date of grant. The weighted average grant date fair value per share of RSUs granted in the nine months ended September 30, 2013 and 2012 was $90.50 and $85.85, respectively. | |||||||||||||||||
At September 30, 2013, we had approximately $21.5 million of unrecognized compensation expense related to non-vested RSU awards, net of estimated forfeitures. This expense is expected to be recognized over a weighted average period of 1.4 years. |
Net_Loss_Per_Common_Share
Net Loss Per Common Share | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Earnings Per Share [Abstract] | ' | ||||||||
Net Loss Per Common Share | ' | ||||||||
Note 13. Net Loss Per Common Share | |||||||||
Basic net loss per common share is computed by dividing net loss for the period by the weighted-average number of common shares outstanding during the period. Diluted net loss per common share adjusts basic net loss per share for the dilutive effects of convertible securities, share-based awards and other potentially dilutive instruments only in the periods in which the effect is dilutive. Due to our net loss for all periods presented, all potentially dilutive instruments were excluded because their inclusion would have been anti-dilutive. The following instruments have been excluded from the calculation of diluted net loss per share, as their effect would be anti-dilutive. | |||||||||
Three and Nine Months Ended | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
(in thousands) | |||||||||
Common shares issuable upon: | |||||||||
Conversion of convertible senior notes | 1,438 | 1,438 | |||||||
Exercise or vesting of share-based awards | 787 | 852 |
Business_Segment_Geographic_Ar
Business Segment, Geographic Areas and Major Customers | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Segment Reporting [Abstract] | ' | ||||||||||||||||
Business Segment, Geographic Areas and Major Customers | ' | ||||||||||||||||
Note 14. Business Segment, Geographic Areas and Major Customers | |||||||||||||||||
For financial reporting purposes, we have one reportable segment which designs, manufactures and markets medical devices for the treatment of advanced heart failure. Products are sold to customers located in the United States through our clinical trials and as commercial products, as commercial products to customers in Europe and under special access in other countries. Product sales attributed to a country or region are based on the location of the customer to whom the products are sold. Long-lived assets are primarily held in the United States. | |||||||||||||||||
Product sales by geographic location were as follows: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
(in thousands) | |||||||||||||||||
United States | $ | 28,166 | $ | 3,627 | $ | 79,422 | $ | 14,264 | |||||||||
Germany | 14,951 | 9,756 | 40,984 | 29,570 | |||||||||||||
International, excluding Germany | 11,683 | 9,479 | 34,469 | 34,427 | |||||||||||||
$ | 54,800 | $ | 22,862 | $ | 154,875 | $ | 78,261 | ||||||||||
The percentage of our revenue generated in the U.S. increased in 2013 as compared to 2012 due to receipt in November 2012 of FDA approval to sell the HeartWare System commercially in the U.S. As a significant portion of our revenue is generated outside of the U.S., we are dependent on favorable economic and regulatory environments for our products in Europe and other countries outside of the U.S. For the three and nine months ended September 30, 2013, no customer exceeded 10% of product sales individually. |
Commitments_and_Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2013 | |
Commitments And Contingencies Disclosure [Abstract] | ' |
Commitments and Contingencies | ' |
Note 15. Commitments and Contingencies | |
At September 30, 2013, we had purchase order commitments of approximately $47.7 million related to product costs, supplies, services and property, plant and equipment purchases. Many of our materials and supplies require long lead times. Our purchase order commitments reflect materials that may be received up to one year from the date of order. | |
In addition to the above, we have entered into employment agreements with all of our executive officers. These contracts do not have a fixed term and are constructed on an at-will basis. Some of these contracts provide executives with the right to receive certain additional payments and benefits if their employment is terminated including after a change of control, as defined in these agreements. | |
From time to time we invest in certain development stage entities in connection with research activities. Certain contingent milestone payments in connection with these arrangements have not been accrued in the accompanying condensed consolidated financial statements as the amounts are indeterminate at this time. | |
The taxation and customs requirements, together with other applicable laws and regulations of certain foreign jurisdictions, can be inherently complex and subject to differing interpretation by local authorities. We are subject to the risk that either we have misinterpreted applicable laws and regulations, or that foreign authorities may take inconsistent, unclear or changing positions on local law, customs practices or rules. In the event that we have misinterpreted any of the above, or that foreign authorities take positions contrary to ours, we may incur liabilities that may differ materially from the amounts accrued in the accompanying condensed consolidated financial statements. | |
Litigation | |
From time to time we may be involved in litigation or other contingencies arising in the ordinary course of business. Based on the information presently available, management believes there are no contingencies, claims or actions, pending or threatened, the ultimate resolution of which will have a material adverse effect on our financial position, liquidity or result of operations. | |
In accordance with FASB ASC 450, Contingencies, we accrue loss contingencies including costs of settlement, damages and defense related to litigation to the extent they are probable and reasonably estimable. Otherwise, we expense these costs as incurred. If the estimate of a probable loss is a range and no amount within the range is more likely, we accrue the minimum amount of the range. |
Subsequent_Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2013 | |
Subsequent Events [Abstract] | ' |
Subsequent Events | ' |
Note 16. Subsequent Events | |
We have evaluated events and transactions that occurred subsequent to September 30, 2013 through the date the financial statements were issued, for potential recognition or disclosure in the accompanying condensed consolidated financial statements. Except as disclosed below, we did not identify any events or transactions that should be recognized or disclosed in the accompanying condensed consolidated financial statements. | |
Strategic Investment | |
In October 2013, we invested $10 million in the form of a convertible promissory note (the “Note”) in a privately held company that is focused on the development of novel, minimally invasive heart therapies. Principal and interest at a rate equal to 6% per annum is due and payable at maturity. Maturity occurs at the earlier of one year or the occurrence of certain events defined in the Note, including an event of default or a change in control. Principal and interest on the Note are repayable, at the option of the issuer, in cash or shares of the most recently issued series of preferred stock or a comparable newly issued series of preferred stock. | |
Lease for New Headquarters | |
On October 17, 2013, we entered into a lease for a new facility in Framingham, Massachusetts that is expected to commence in January 2014. The facility will be used primarily as our corporate headquarters for office and ancillary laboratory purposes including development testing. Under the lease, we will rent approximately 58,000 square feet for an initial seven year period, with an option to renew for a period of fifty seven months, but in no event beyond September 30, 2025. Annual base rent will be approximately $1.2 million, payable monthly starting ten months after the lease commences. Annual base rent is subject to periodic increases beginning in year four. A security deposit of $0.3 million was paid in connection with the lease. | |
. |
Significant_Accounting_Policie1
Significant Accounting Policies (Policies) | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Accounting Policies [Abstract] | ' | ||||||||
Principles of Consolidation | ' | ||||||||
Principles of Consolidation | |||||||||
The accompanying condensed consolidated financial statements include the accounts of the HeartWare Group. All inter-company balances and transactions have been eliminated in consolidation. We hold certain investments in small privately-held development-stage entities which are included in other assets on our condensed consolidated balance sheets. In accordance with FASB ASC 810, we analyzed the investments to determine whether the investments are variable interests or interests that give us a controlling financial interest in a variable interest entity (“VIE”). As of September 30, 2013, we determined there were no VIEs required to be consolidated, because we are not the primary beneficiary, as we do not have the power to direct the most meaningful activities of the VIE. Investments where we do not exercise operating and financial control are accounted for under the equity method or cost method depending on our ownership interest. | |||||||||
Accounting Estimates | ' | ||||||||
Accounting Estimates | |||||||||
The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from those estimates. Our most critical accounting policies and estimates include: revenue recognition, inventory capitalization and valuation, accounting for share-based compensation, measurement of fair value, and the valuation of tax assets and liabilities. | |||||||||
Cash and Cash Equivalents | ' | ||||||||
Cash and Cash Equivalents | |||||||||
Cash and cash equivalents are recorded on our condensed consolidated balance sheets at cost, which approximates fair value. All highly liquid investments with an original maturity of three months or less at the date of purchase are considered to be cash equivalents. | |||||||||
Investments | ' | ||||||||
Investments | |||||||||
Our investments classified as available-for-sale are stated at fair value with unrealized gains and losses reported in accumulated other comprehensive loss within stockholders’ equity. We classify our available-for-sale investments as short-term if their remaining time to maturity at purchase is beyond three months, but less than twenty-four months. Investments with maturities at purchase beyond one year, but less than twenty-four months, may be classified as short-term based on their highly liquid nature and because these marketable securities represent the investment of cash that is available for current operations. Interest on investments classified as available-for-sale is included in investment income, net. Premiums paid on our short-term investments are amortized over the remaining term of the investment and the amortization is included in investment income, net. | |||||||||
Receivables | ' | ||||||||
Receivables | |||||||||
Accounts receivable consists of amounts due from the sale of our HeartWare® Ventricular Assist System (the “HeartWare System”) to our customers, which include hospitals, health research institutions and medical device distributors. We grant credit to customers in the normal course of business, but generally do not require collateral or any other security to support credit sales. Our receivables are geographically dispersed, with a significant portion from customers located in Europe and other foreign countries. At September 30, 2013, one customer had an accounts receivable balance greater than 10% of total accounts receivable representing approximately 13% of our total accounts receivable. At December 31, 2012, no customer had an accounts receivable balance greater than 10% of our total accounts receivable. | |||||||||
We maintain allowances for doubtful accounts for estimated losses that may result from an inability to collect payments owed to us for product sales. We regularly review the allowance by considering factors such as historical experience, the age of the accounts receivable balances and local economic conditions that may affect a customer’s ability to pay. Account balances are charged off against the allowance after appropriate collection efforts have been exhausted and we feel it is probable that the receivable will not be recovered. | |||||||||
The following table summarizes the change in our allowance for doubtful accounts for the nine months ended September 30, 2013 and 2012: | |||||||||
2013 | 2012 | ||||||||
(in thousands) | |||||||||
Beginning balance | $ | 750 | $ | 500 | |||||
(Reversals) charges to expense | (206 | ) | 250 | ||||||
Charge-offs | — | — | |||||||
Ending balance | $ | 544 | $ | 750 | |||||
As of September 30, 2013 and December 31, 2012, we did not have an allowance for returns. | |||||||||
Inventories | ' | ||||||||
Inventories | |||||||||
Inventories are stated at the lower of cost or market. Cost is determined using a first-in, first-out, or FIFO, method. Work-in-process and finished goods manufactured or assembled by us include direct and indirect labor and manufacturing overhead. Finished goods include product which is ready-for-use and which is held by us or by our customers on a consignment basis. | |||||||||
We review our inventory for excess or obsolete inventory and write-down obsolete or otherwise unmarketable inventory to its estimated net realizable value. Obsolescence may occur due to product expiring or product improvements rendering previous versions obsolete. | |||||||||
Deferred Financing Costs | ' | ||||||||
Deferred Financing Costs | |||||||||
Costs incurred in connection with the issuance of our convertible senior notes have been allocated between the liability component and the equity component as further discussed in Note 10 (Debt). The issuance costs allocated to the convertible senior notes were capitalized within deferred financing costs, net on our condensed consolidated balance sheets. These costs are being amortized using the effective interest method through December 15, 2017, the maturity date of the notes, and the amortization expense is reflected in interest expense on our condensed consolidated statements of operations. The amount of amortization for the three months ended September 30, 2013 and 2012 was approximately $0.1 million for each period. The amount of amortization for the nine months ended September 30, 2013 and 2012 was approximately $0.3 million and $0.2 million, respectively. The amount of accumulated amortization at September 30, 2013 and December 31, 2012 was approximately $0.9 million and $0.6 million, respectively. | |||||||||
Product Warranty | ' | ||||||||
Product Warranty | |||||||||
Certain patient accessories sold with the HeartWare System are covered by a limited warranty ranging from one to two years. Estimated contractual warranty obligations are recorded as an expense when the related revenue is recognized and are included in cost of revenue on our condensed consolidated statements of operations. Factors that affect estimated warranty liability include the number of units sold, historical and anticipated rates of warranty claims, cost per claim, and vendor supported warranty programs. We periodically assess the adequacy of our recorded warranty liabilities and adjust the amounts as necessary. | |||||||||
The amount of the liability recorded is equal to the estimated costs to repair or otherwise satisfy claims made by customers. Accrued warranty expense is included as a component of other accrued liabilities on our condensed consolidated balance sheets. | |||||||||
The costs to repair or replace products associated with product recalls and voluntary service campaigns are recorded when they are determined to be probable and reasonably estimable as a cost of revenue and are not included in product warranty liability. No such costs were incurred in the three and nine months ended September 30, 2013 and 2012. | |||||||||
The following table summarizes the change in our warranty liability for the nine months ended September 30, 2013 and 2012: | |||||||||
2013 | 2012 | ||||||||
(in thousands) | |||||||||
Beginning balance | $ | 543 | $ | 203 | |||||
Accrual for warranty expense | 856 | 668 | |||||||
Warranty costs incurred during the period | (345 | ) | (453 | ) | |||||
Ending balance | $ | 1,054 | $ | 418 | |||||
Leases | ' | ||||||||
Leases | |||||||||
We lease all of our administrative and manufacturing facilities. We recognize rent expense on a straight-line basis over the terms of our leases. Any scheduled rent increases, rent holidays and other related incentives are recognized on a straight-line basis over the terms of the leases. The difference between the cash rental payments and the straight-line recognition of rent expense over the terms of the leases results in a deferred rent asset or liability. As of September 30, 2013, the long-term portion of our deferred rent liability of approximately $2.6 million is included in other long-term liabilities on our condensed consolidated balance sheets. | |||||||||
Fair Value Measurements | ' | ||||||||
Fair Value Measurements | |||||||||
The carrying amounts reported on our condensed consolidated balance sheets for cash and cash equivalents, accounts receivable, accounts payable and other accrued liabilities approximate their fair value based on the short-term maturity of these instruments. Investments are considered available-for-sale as of September 30, 2013 and December 31, 2012 and are carried at fair value. See Note 4 (Fair Value Measurements) and Note 10 (Debt) for more information. | |||||||||
Vendor Concentration | ' | ||||||||
Vendor Concentration | |||||||||
For the three and nine months ended September 30, 2013, we purchased approximately 69% and 68%, respectively, of our inventory components and supplies from three vendors. For the three and nine months ended September 30, 2012, we purchased approximately 57% and 66%, respectively, of our inventory components and supplies from the same three vendors. In addition, one of these vendors provides consulting services and material used in research and development activities. As of September 30, 2013 and 2012, the amounts due to these vendors totaled approximately $3.2 million and $2.9 million, respectively. | |||||||||
We purchase certain important components of the HeartWare System from single-source suppliers. We cannot guarantee that we can secure alternative suppliers that could provide similar components on comparable terms and consistent with regulatory requirements. A change in suppliers could cause a delay in manufacturing and a possible loss of product sales or result in higher component costs, all of which would have a negative effect on our results of operations. | |||||||||
Concentration of Credit Risk and Other Risks and Uncertainties | ' | ||||||||
Concentration of Credit Risk and other Risks and Uncertainties | |||||||||
Financial instruments that potentially expose us to concentrations of credit risk consist primarily of cash and cash equivalents, investments and trade accounts receivable. Cash and cash equivalents are primarily on deposit with financial institutions in the United States and these deposits generally exceed the amount of insurance provided by the Federal Deposit Insurance Corporation (the “FDIC”). The Company has not experienced any historical losses on its deposits of cash and cash equivalents. Our investments consist of investment grade rated corporate and government agency debt and time deposits. | |||||||||
Concentration of credit risk with respect to our trade accounts receivable from our customers is primarily limited to hospitals, health research institutions and medical device distributors. Credit is extended to our customers, based on an evaluation of a customer’s financial condition and collateral is generally not required. | |||||||||
We are subject to certain risks and uncertainties including, but not limited to, our ability to achieve profitability, to generate cash flow sufficient to satisfy our indebtedness, to run clinical trials in order to receive and maintain FDA and foreign regulatory approvals for our products, to achieve widespread acceptance of our products, to manufacture our products in a sufficient volume and at a reasonable cost, and to protect our proprietary technologies and develop new products as well as risks associated with operating in foreign countries, and general competitive and economic conditions. Changes in any of the preceding areas could have a material adverse effect on our business, results of operations or financial position. | |||||||||
New Accounting Standards | ' | ||||||||
New Accounting Standards | |||||||||
In September 2012, the FASB issued ASU No. 2012-02, Intangibles – Goodwill and Other (Topic 350), Testing Indefinite-Lived Intangible Assets for Impairment, which provides an entity the option first to assess qualitative factors to determine whether the existence of events and circumstances indicates that it is more likely than not that an indefinite-lived intangible asset is impaired. If, after assessing the totality of events and circumstances, an entity concludes that it is not more likely than not that the indefinite-lived intangible asset is impaired, then the entity is not required to take further action. The qualitative assessment is optional, allowing companies to go directly to the quantitative assessment. ASU No. 2012-02 is effective for our annual and interim impairment tests performed subsequent to January 1, 2013. The adoption of ASU No. 2012-02 did not affect our consolidated financial position, results of operations or cash flows. | |||||||||
In July 2013, the FASB issued ASU No. 2013-11, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (a consensus of the FASB Emerging Issues Task Force). U.S. GAAP does not include explicit guidance on the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. The amendments in this ASU state that an unrecognized tax benefit, or a portion of an unrecognized tax benefit, should be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward, except as follows: To the extent a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available at the reporting date under the tax law of the applicable jurisdiction to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. This ASU applies to all entities that have unrecognized tax benefits when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists at the reporting date. The amendments in this ASU are effective for fiscal years, and interim periods within those years, beginning after December 15, 2013, with early adoption permitted. The amendments should be applied prospectively to all unrecognized tax benefits that exist at the effective date, although retrospective application is permitted. We plan to adopt ASU No. 2013-11 effective January 1, 2014. The adoption of ASU No. 2013-11 is not expected to have a material effect on our consolidated financial position, results of operations or cash flows. | |||||||||
Debt | ' | ||||||||
In accordance with FASB ASC 470-20, Debt with Conversion and Other Options, which applies to certain convertible debt instruments that may be settled in cash or other assets, or partially in cash, upon conversion, we recorded the long-term debt and equity components on our Convertible Notes separately on the issuance date. The amount recorded for long-term debt was determined by measuring the fair value of a similar liability that does not have an associated equity component. The measurement of fair value required the Company to make estimates and assumptions to determine the present value of the cash flows of the Convertible Notes, absent the conversion feature. This treatment increased interest expense associated with our Convertible Notes by adding a non-cash component to interest expense in the form of amortization of a debt discount calculated based on the difference between the 3.5% cash coupon rate and the effective interest rate on debt borrowing of approximately 12.5%. The discount is being amortized to interest expense through the December 15, 2017 maturity date of the Convertible Notes using the effective interest method and is included in interest expense on our condensed consolidated statements of operations. Additionally, we allocated the costs related to issuance of the Convertible Notes on the same percentage as the long-term debt and equity components, such that a portion of the costs is allocated to the long-term debt component and the equity component included in additional paid-in capital. The portion of the costs allocated to the long-term debt component is presented as deferred financing costs, net on our condensed consolidated balance sheets. These deferred financing costs are also being amortized to interest expense through the December 15, 2017 maturity date of the Convertible Notes using the effective interest method and the amortization is included in interest expense on our condensed consolidated statements of operations. | |||||||||
Contingencies | ' | ||||||||
In accordance with FASB ASC 450, Contingencies, we accrue loss contingencies including costs of settlement, damages and defense related to litigation to the extent they are probable and reasonably estimable. Otherwise, we expense these costs as incurred. If the estimate of a probable loss is a range and no amount within the range is more likely, we accrue the minimum amount of the range. |
Significant_Accounting_Policie2
Significant Accounting Policies (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Accounting Policies [Abstract] | ' | ||||||||
Summary of Change in Allowance for Doubtful Accounts | ' | ||||||||
The following table summarizes the change in our allowance for doubtful accounts for the nine months ended September 30, 2013 and 2012: | |||||||||
2013 | 2012 | ||||||||
(in thousands) | |||||||||
Beginning balance | $ | 750 | $ | 500 | |||||
(Reversals) charges to expense | (206 | ) | 250 | ||||||
Charge-offs | — | — | |||||||
Ending balance | $ | 544 | $ | 750 | |||||
Summary of Change in Warranty Liability | ' | ||||||||
The following table summarizes the change in our warranty liability for the nine months ended September 30, 2013 and 2012: | |||||||||
2013 | 2012 | ||||||||
(in thousands) | |||||||||
Beginning balance | $ | 543 | $ | 203 | |||||
Accrual for warranty expense | 856 | 668 | |||||||
Warranty costs incurred during the period | (345 | ) | (453 | ) | |||||
Ending balance | $ | 1,054 | $ | 418 | |||||
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 9 Months Ended | ||||||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||||||||||
Fair Value of Financial Assets and Financial Liabilities Measured at Fair Value on a Recurring Basis | ' | ||||||||||||||||||||||||
The following table represents the fair value of our financial assets and financial liabilities measured at fair value on a recurring basis and which level was used in the fair value hierarchy. | |||||||||||||||||||||||||
At September 30, 2013 | |||||||||||||||||||||||||
Fair Value Measurements at the Reporting Date Using | |||||||||||||||||||||||||
Carrying | Fair | Level 1 | Level 2 | Level 3 | |||||||||||||||||||||
Value | Value | ||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||
Short-term investments | $ | 35,875 | $ | 35,875 | $ | — | $ | 35,875 | $ | — | |||||||||||||||
Long-term investments | 1,225 | 1,225 | — | 1,225 | — | ||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||
Convertible senior notes | 105,345 | (1 | ) | 160,281 | — | 160,281 | — | ||||||||||||||||||
Royalties | 981 | (2 | ) | 981 | — | — | 981 | ||||||||||||||||||
At December 31, 2012 | |||||||||||||||||||||||||
Fair Value Measurements at the Reporting Date Using | |||||||||||||||||||||||||
Carrying | Fair | Level 1 | Level 2 | Level 3 | |||||||||||||||||||||
Value | Value | ||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||
Short-term investments | $ | 16,887 | $ | 16,887 | $ | — | $ | 16,887 | $ | — | |||||||||||||||
Liabilities | |||||||||||||||||||||||||
Convertible senior notes | 100,315 | (1 | ) | 169,122 | — | 169,122 | — | ||||||||||||||||||
Royalties | 1,113 | (2 | ) | 1,113 | — | — | 1,113 | ||||||||||||||||||
-1 | The carrying amount of our convertible senior notes is net of unamortized discount. See Note 10 (Debt) for more information. | ||||||||||||||||||||||||
-2 | Royalties represent the fair value of future royalty payments to be made pursuant to agreements related to intellectual property licensed or acquired by World Heart to be paid over the next 3 to 17 years. | ||||||||||||||||||||||||
Summary of Change in Fair Value for the Royalties Payment Obligation | ' | ||||||||||||||||||||||||
The following table summarizes the change in fair value, as determined by Level 3 inputs, of the royalty payment obligations for the nine months ended September 30, 2013: | |||||||||||||||||||||||||
Royalties | |||||||||||||||||||||||||
(in thousands) | |||||||||||||||||||||||||
Beginning balance | $ | 1,113 | |||||||||||||||||||||||
Payments | (185 | ) | |||||||||||||||||||||||
Change in fair value | 53 | ||||||||||||||||||||||||
Ending balance | $ | 981 |
Investments_Tables
Investments (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Investments Debt And Equity Securities [Abstract] | ' | ||||||||||||||||
Summary of Amortized Cost and Fair Value of Investments | ' | ||||||||||||||||
The amortized cost and fair value of our investments, with gross unrealized gains and losses, were as follows: | |||||||||||||||||
At September 30, 2013 | |||||||||||||||||
Amortized | Gross | Gross | Aggregate | ||||||||||||||
Cost Basis | Unrealized | Unrealized | Fair Value | ||||||||||||||
Gains | Losses | ||||||||||||||||
(in thousands) | |||||||||||||||||
Short-term investments: | |||||||||||||||||
Corporate debt | $ | 29,824 | $ | — | $ | (29 | ) | $ | 29,795 | ||||||||
Certificates of deposit | 6,080 | — | — | 6,080 | |||||||||||||
Total short-term investments | $ | 35,904 | $ | — | $ | (29 | ) | $ | 35,875 | ||||||||
Long-term investments: | |||||||||||||||||
Certificates of deposit | $ | 1,225 | $ | — | $ | — | $ | 1,225 | |||||||||
Total long-term investments | $ | 1,225 | $ | — | $ | — | $ | 1,225 | |||||||||
At December 31, 2012 | |||||||||||||||||
Amortized | Gross | Gross | Aggregate | ||||||||||||||
Cost Basis | Unrealized | Unrealized | Fair Value | ||||||||||||||
Gains | Losses | ||||||||||||||||
(in thousands) | |||||||||||||||||
Short-term investments: | |||||||||||||||||
Corporate debt | $ | 10,565 | $ | — | $ | (25 | ) | $ | 10,540 | ||||||||
Certificates of deposit | 6,346 | 1 | — | 6,347 | |||||||||||||
Total short-term investments | $ | 16,911 | $ | 1 | $ | (25 | ) | $ | 16,887 | ||||||||
Inventories_Tables
Inventories (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Inventory Disclosure [Abstract] | ' | ||||||||
Components of Inventories | ' | ||||||||
Components of inventories are as follows: | |||||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
(in thousands) | |||||||||
Raw material | $ | 19,398 | $ | 11,192 | |||||
Work-in-process | 8,519 | 11,123 | |||||||
Finished goods | 9,966 | 16,128 | |||||||
$ | 37,883 | $ | 38,443 | ||||||
Property_Plant_and_Equipment_N1
Property, Plant and Equipment, Net (Tables) | 9 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Property Plant And Equipment [Abstract] | ' | ||||||||||||
Property, Plant and Equipment, Net | ' | ||||||||||||
Property, plant and equipment, net consists of the following: | |||||||||||||
Estimated | September 30, | December 31, | |||||||||||
Useful Lives | 2013 | 2012 | |||||||||||
(in thousands) | |||||||||||||
Machinery and equipment | 1.5 to 7 years | $ | 17,556 | $ | 17,894 | ||||||||
Leasehold improvements | 3 to 10 years | 6,283 | 8,082 | ||||||||||
Office equipment, furniture and fixtures | 5 to 7 years | 1,035 | 912 | ||||||||||
Purchased software | 1 to 7 years | 4,643 | 3,572 | ||||||||||
29,517 | 30,460 | ||||||||||||
Less: accumulated depreciation | (13,205 | ) | (11,080 | ) | |||||||||
$ | 16,312 | $ | 19,380 | ||||||||||
Goodwill_and_Intangible_Assets1
Goodwill and Intangible Assets, Net (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Goodwill And Intangible Assets Disclosure [Abstract] | ' | ||||||||||||||||
Summary of Gross Carrying Amount of Amortizable Intangible Assets and Related Accumulated Amortization | ' | ||||||||||||||||
The gross carrying amount of amortizable intangible assets and the related accumulated amortization for intangible assets are as follows: | |||||||||||||||||
September 30, 2013 | December 31, 2012 | ||||||||||||||||
Gross Carrying | Accumulated | Gross Carrying | Accumulated | ||||||||||||||
Amount | Amortization | Amount | Amortization | ||||||||||||||
(in thousands) | |||||||||||||||||
Patents | $ | 6,449 | $ | (981 | ) | $ | 5,865 | $ | (606 | ) |
Other_Accrued_Liabilities_Tabl
Other Accrued Liabilities (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Text Block [Abstract] | ' | ||||||||
Summary of Other Accrued Liabilities | ' | ||||||||
Other accrued liabilities consist of the following: | |||||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
(in thousands) | |||||||||
Accrued payroll and other employee costs | $ | 9,240 | $ | 8,818 | |||||
Accrued material purchases | 3,495 | 5,628 | |||||||
Accrued professional fees | 3,037 | 1,340 | |||||||
Accrued research and development costs | 2,071 | 3,132 | |||||||
Accrued interest payable | 1,482 | 211 | |||||||
Accrued VAT | 2,253 | 1,212 | |||||||
Other accrued expenses | 4,116 | 1,679 | |||||||
$ | 25,694 | $ | 22,020 | ||||||
Debt_Tables
Debt (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Debt Disclosure [Abstract] | ' | ||||||||||||||||
Summary of Convertible Notes and Equity Component | ' | ||||||||||||||||
The Convertible Notes and the equity component, which is recorded in additional paid-in-capital, consisted of the following: | |||||||||||||||||
September 30, | December 31, | ||||||||||||||||
2013 | 2012 | ||||||||||||||||
(in thousands) | |||||||||||||||||
Principal amount | $ | 143,750 | $ | 143,750 | |||||||||||||
Unamortized discount | (38,405 | ) | (43,435 | ) | |||||||||||||
Net carrying amount | $ | 105,345 | $ | 100,315 | |||||||||||||
Equity component | $ | 55,038 | $ | 55,038 | |||||||||||||
Summary of Interest Expense Related to Convertible Notes | ' | ||||||||||||||||
component. For the three and nine months ended September 30, 2013 and 2012, interest expense related to the Convertible Notes was as follows: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
(in thousands) | |||||||||||||||||
Stated amount at 3.5% coupon rate | $ | 1,258 | $ | 1,258 | $ | 3,774 | $ | 3,774 | |||||||||
Amortization of discount | 1,727 | 1,532 | 5,030 | 4,460 | |||||||||||||
Amortization of deferred financing costs | 93 | 82 | 270 | 239 | |||||||||||||
$ | 3,078 | $ | 2,872 | $ | 9,074 | $ | 8,473 | ||||||||||
ShareBased_Compensation_Tables
Share-Based Compensation (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ' | ||||||||||||||||
Allocation of Share-Based Compensation Expense | ' | ||||||||||||||||
For the three and nine months ended September 30, 2013 and 2012, we recorded share-based compensation expense as follows: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
(In thousands) | |||||||||||||||||
Cost of revenue | $ | 828 | $ | 698 | $ | 1,970 | $ | 2,451 | |||||||||
Selling, general and administrative | 3,951 | 2,746 | 9,169 | 8,234 | |||||||||||||
Research and development | 2,286 | 1,449 | 5,303 | 4,262 | |||||||||||||
$ | 7,065 | $ | 4,893 | $ | 16,442 | $ | 14,947 | ||||||||||
Weighted Average Assumptions Used for Options Issued | ' | ||||||||||||||||
The following table includes the weighted average assumptions used for options issued in the nine months ended September 30, 2013 and 2012. | |||||||||||||||||
Nine Months Ended | |||||||||||||||||
September 30, | |||||||||||||||||
2013 | 2012 | ||||||||||||||||
Dividend yield | 0 | % | 0 | % | |||||||||||||
Expected volatility | 40 | % | 57 | % | |||||||||||||
Risk-free interest rate | 1.15 | % | 1 | % | |||||||||||||
Estimated holding period (years) | 6.25 | 6.25 | |||||||||||||||
Summary of Options Granted Under All Plans | ' | ||||||||||||||||
Information related to options granted under all of our plans at September 30, 2013 and activity in the nine months then ended is as follows (certain amounts in U.S.$ were converted from AU$ at the then period-end spot rate): | |||||||||||||||||
Number of | Weighted | Weighted | Aggregate | ||||||||||||||
Options | Average | Average | Intrinsic | ||||||||||||||
(in thousands) | Exercise | Remaining | Value | ||||||||||||||
Price | Contractual Life | (in thousands) | |||||||||||||||
(Years) | |||||||||||||||||
Outstanding at December 31, 2012 | 291 | $ | 36.7 | ||||||||||||||
Granted | 7 | 95.05 | |||||||||||||||
Exercised | (120 | ) | 28.23 | ||||||||||||||
Forfeited | — | — | |||||||||||||||
Expired | — | — | |||||||||||||||
Outstanding at September 30, 2013 | 178 | $ | 40.88 | 4.65 | $ | 6,032 | |||||||||||
Exercisable at September 30, 2013 | 150 | $ | 34.71 | 4.01 | $ | 5,806 | |||||||||||
Summary of RSU's | ' | ||||||||||||||||
Information related to RSUs at September 30, 2013 and activity in the nine months then ended is as follows: | |||||||||||||||||
Number of | Weighted | Aggregate | |||||||||||||||
Units | Average | Intrinsic | |||||||||||||||
(in thousands) | Remaining | Value | |||||||||||||||
Contractual Life | (in thousands) | ||||||||||||||||
(Years) | |||||||||||||||||
Outstanding at December 31, 2012 | 547 | ||||||||||||||||
Granted | 108 | ||||||||||||||||
Vested/Exercised | (31 | ) | |||||||||||||||
Forfeited | (15 | ) | |||||||||||||||
Expired | — | ||||||||||||||||
Outstanding at September 30, 2013 | 609 | 1.63 | $ | 44,560 | |||||||||||||
Exercisable at September 30, 2013 | — | — | $ | — | |||||||||||||
Net_Loss_Per_Common_Share_Tabl
Net Loss Per Common Share (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Earnings Per Share [Abstract] | ' | ||||||||
Anti-Dilutive Securities Excluded from Computation of Earnings Per Share | ' | ||||||||
The following instruments have been excluded from the calculation of diluted net loss per share, as their effect would be anti-dilutive. | |||||||||
Three and Nine Months Ended | |||||||||
September 30, | |||||||||
2013 | 2012 | ||||||||
(in thousands) | |||||||||
Common shares issuable upon: | |||||||||
Conversion of convertible senior notes | 1,438 | 1,438 | |||||||
Exercise or vesting of share-based awards | 787 | 852 |
Business_Segment_Geographic_Ar1
Business Segment, Geographic Areas and Major Customers (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Segment Reporting [Abstract] | ' | ||||||||||||||||
Product Sales by Geographic Location | ' | ||||||||||||||||
Product sales by geographic location were as follows: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
(in thousands) | |||||||||||||||||
United States | $ | 28,166 | $ | 3,627 | $ | 79,422 | $ | 14,264 | |||||||||
Germany | 14,951 | 9,756 | 40,984 | 29,570 | |||||||||||||
International, excluding Germany | 11,683 | 9,479 | 34,469 | 34,427 | |||||||||||||
$ | 54,800 | $ | 22,862 | $ | 154,875 | $ | 78,261 | ||||||||||
Liquidity_Additional_Informati
Liquidity - Additional Information (Detail) (USD $) | 1 Months Ended | 9 Months Ended | |||
Mar. 18, 2013 | Mar. 31, 2013 | Sep. 30, 2013 | Mar. 12, 2013 | Dec. 31, 2012 | |
Liquidity [Abstract] | ' | ' | ' | ' | ' |
Cash, cash equivalents and investments | ' | ' | $225,000,000 | ' | ' |
Issuance of common stock pursuant to public offering, net of offering costs, shares | ' | 1,725,000 | ' | ' | ' |
Issuance of Common Stock under Initial Public Offering to Underwriters | ' | 225,000 | ' | ' | ' |
Offering price, per share | ' | $86.45 | ' | $86.45 | ' |
Issuance of common stock pursuant to public offering | ' | 149,100,000 | 149,126,000 | ' | ' |
Issuance of common stock pursuant to public offering, net of offering costs | 141,000,000 | 141,000,000 | ' | ' | ' |
Accumulated deficit approximately | ' | ' | ($307,305,000) | ' | ($270,042,000) |
Significant_Accounting_Policie3
Significant Accounting Policies - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | |
Vendor | VIE | Customer | |||
VIE | Customer | ||||
Customer | |||||
Significant Accounting Policies [Line Items] | ' | ' | ' | ' | ' |
VIE's required to be consolidated | 0 | ' | 0 | ' | ' |
Cash and cash equivalent maximum maturity period | ' | ' | '3 months | ' | ' |
Percentage of account receivables by customers | 10.00% | ' | 10.00% | ' | 10.00% |
Number of customers having account receivable balance | 1 | ' | 1 | ' | 0 |
Percentage of accounts receivable from major customer | 13.00% | ' | 13.00% | ' | ' |
Allowance for returns | ' | ' | $0 | ' | $0 |
Accumulated amortization of deferred costs | 900,000 | ' | 900,000 | ' | 600,000 |
Deferred cost amortization expense | 93,000 | 82,000 | 270,000 | 239,000 | ' |
Maturity date of notes | ' | ' | 15-Dec-17 | ' | ' |
Cost of revenue | 19,529,000 | 10,925,000 | 57,175,000 | 34,418,000 | ' |
Deferred rent liability | 2,600,000 | ' | 2,600,000 | ' | ' |
Percentage of inventory component purchased | 69.00% | 57.00% | 68.00% | 66.00% | ' |
Number of vendors supplying material consulting services | 1 | ' | ' | ' | ' |
Number of vendors for inventory supply | 3 | ' | ' | ' | ' |
Amount due to vendors | 3,200,000 | 2,900,000 | 3,200,000 | 2,900,000 | ' |
Product Recall Expense [Member] | ' | ' | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' | ' | ' |
Cost of revenue | $0 | $0 | $0 | ' | ' |
Convertible Debt [Member] | ' | ' | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' | ' | ' |
Maturity date of notes | ' | ' | 15-Dec-17 | ' | ' |
Minimum [Member] | ' | ' | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' | ' | ' |
Maturity date of short term investment | ' | ' | '3 months | ' | ' |
Maturity of investment classified as short-term | ' | ' | '1 year | ' | ' |
Maturity of limited warranty | ' | ' | '1 year | ' | ' |
Maximum [Member] | ' | ' | ' | ' | ' |
Significant Accounting Policies [Line Items] | ' | ' | ' | ' | ' |
Maturity date of short term investment | ' | ' | '24 months | ' | ' |
Maturity of investment classified as short-term | ' | ' | '24 months | ' | ' |
Maturity of limited warranty | ' | ' | '2 years | ' | ' |
Significant_Accounting_Policie4
Significant Accounting Policies - Summary of Change in Allowance for Doubtful Accounts (Detail) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Accounting Policies [Abstract] | ' | ' |
Beginning balance | $750 | $500 |
(Reversals) charges to expense | -206 | 250 |
Charge-offs | ' | ' |
Ending balance | $544 | $750 |
Significant_Accounting_Policie5
Significant Accounting Policies - Summary of Change in Warranty Liability (Detail) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Accounting Policies [Abstract] | ' | ' |
Beginning balance | $543 | $203 |
Accrual for warranty expense | 856 | 668 |
Warranty costs incurred during the period | -345 | -453 |
Ending balance | $1,054 | $418 |
Fair_Value_Measurements_Fair_V
Fair Value Measurements - Fair Value of Financial Assets and Financial Liabilities Measured at Fair Value on a Recurring Basis (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Short-term investments | $35,875 | $16,887 |
Long-term investments | 1,225 | ' |
Level 1 [Member] | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Short-term investments | ' | ' |
Long-term investments | ' | ' |
Convertible senior notes | ' | ' |
Royalties | ' | ' |
Level 2 [Member] | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Short-term investments | 35,875 | 16,887 |
Long-term investments | 1,225 | ' |
Convertible senior notes | 160,281 | 169,122 |
Royalties | ' | ' |
Level 3 [Member] | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Short-term investments | ' | ' |
Long-term investments | ' | ' |
Convertible senior notes | ' | ' |
Royalties | 981 | 1,113 |
Carrying Value [Member] | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Short-term investments | 35,875 | 16,887 |
Long-term investments | 1,225 | ' |
Convertible senior notes | 105,345 | 100,315 |
Royalties | 981 | 1,113 |
Fair Value [Member] | ' | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' |
Short-term investments | 35,875 | 16,887 |
Long-term investments | 1,225 | ' |
Convertible senior notes | 160,281 | 169,122 |
Royalties | $981 | $1,113 |
Fair_Value_Measurements_Fair_V1
Fair Value Measurements - Fair Value of Financial Assets and Financial Liabilities Measured at Fair Value on a Recurring Basis (Parenthetical) (Detail) (World Heart [Member]) | 9 Months Ended |
Sep. 30, 2013 | |
Minimum [Member] | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' |
Period for royalty payment obligations | '3 years |
Maximum [Member] | ' |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' |
Period for royalty payment obligations | '17 years |
Fair_Value_Measurement_Summary
Fair Value Measurement - Summary of Change in Fair Value for the Royalties Payment Obligation (Detail) (Level 3 [Member], USD $) | 9 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2013 |
Level 3 [Member] | ' |
Fair Value Measurements Disclosure [Line Items] | ' |
Beginning balance | $1,113 |
Payments | -185 |
Change in fair value | 53 |
Ending balance | $981 |
Fair_Value_Measurements_Additi
Fair Value Measurements - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Fair Value Disclosures [Abstract] | ' | ' | ' | ' |
Impairment | $0 | $0 | $0 | $0 |
Investments_Additional_Informa
Investments - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | |
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ' | ' | ' |
Realized gains (losses) on investments | $0 | $0 | $0 | $0 | ' |
Available-for-sale investments in a continuous loss position for more than twelve months | $0 | ' | $0 | ' | $0 |
Short-Term Investments [Member] | ' | ' | ' | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ' | ' | ' |
Investment maturity date description | ' | ' | 'Less than twenty-four months | ' | ' |
Long Term Investments [Member] | ' | ' | ' | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ' | ' | ' |
Investment maturity date description | ' | ' | 'Beyond twenty-four months, but within thirty-nine months | ' | ' |
Investments_Summary_of_Amortiz
Investments - Summary of Amortized Cost and Fair Value of Investments (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Short-Term Investments [Member] | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Amortized Cost Basis | $35,904 | $16,911 |
Gross Unrealized Gains | ' | 1 |
Gross Unrealized Losses | -29 | -25 |
Aggregate Fair Value | 35,875 | 16,887 |
Short-Term Investments [Member] | Certificates of Deposit [Member] | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Amortized Cost Basis | 6,080 | 6,346 |
Gross Unrealized Gains | ' | 1 |
Gross Unrealized Losses | ' | ' |
Aggregate Fair Value | 6,080 | 6,347 |
Short-Term Investments [Member] | Corporate Debt [Member] | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Amortized Cost Basis | 29,824 | 10,565 |
Gross Unrealized Gains | ' | ' |
Gross Unrealized Losses | -29 | -25 |
Aggregate Fair Value | 29,795 | 10,540 |
Long Term Investments [Member] | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Amortized Cost Basis | 1,225 | ' |
Gross Unrealized Gains | ' | ' |
Gross Unrealized Losses | ' | ' |
Aggregate Fair Value | 1,225 | ' |
Long Term Investments [Member] | Certificates of Deposit [Member] | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Amortized Cost Basis | 1,225 | ' |
Gross Unrealized Gains | ' | ' |
Gross Unrealized Losses | ' | ' |
Aggregate Fair Value | $1,225 | ' |
Inventories_Components_of_Inve
Inventories - Components of Inventories (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Inventory Disclosure [Abstract] | ' | ' |
Raw material | $19,398 | $11,192 |
Work-in-process | 8,519 | 11,123 |
Finished goods | 9,966 | 16,128 |
Inventory, total | $37,883 | $38,443 |
Inventories_Additional_Informa
Inventories - Additional Information (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Inventory Disclosure [Abstract] | ' | ' |
Inventory held on consignment | $4.90 | $5.50 |
Property_Plant_and_Equipment_N2
Property, Plant and Equipment, Net - Property, Plant and Equipment, Net (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 |
In Thousands, unless otherwise specified | Machinery and Equipment [Member] | Machinery and Equipment [Member] | Machinery and Equipment [Member] | Machinery and Equipment [Member] | Leasehold Improvements [Member] | Leasehold Improvements [Member] | Leasehold Improvements [Member] | Leasehold Improvements [Member] | Office Equipment, Furniture and Fixtures [Member] | Office Equipment, Furniture and Fixtures [Member] | Office Equipment, Furniture and Fixtures [Member] | Office Equipment, Furniture and Fixtures [Member] | Purchased Software [Member] | Purchased Software [Member] | Purchased Software [Member] | Purchased Software [Member] | ||
Minimum [Member] | Maximum [Member] | Minimum [Member] | Maximum [Member] | Minimum [Member] | Maximum [Member] | Minimum [Member] | Maximum [Member] | |||||||||||
Property, Plant and Equipment [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Property, plant and equipment, estimated useful lives | ' | ' | ' | ' | '1 year 6 months | '7 years | ' | ' | '3 years | '10 years | ' | ' | '5 years | '7 years | ' | ' | '1 year | '7 years |
Property, plant and equipment, gross | $29,517 | $30,460 | $17,556 | $17,894 | ' | ' | $6,283 | $8,082 | ' | ' | $1,035 | $912 | ' | ' | $4,643 | $3,572 | ' | ' |
Less: accumulated depreciation | -13,205 | -11,080 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Property, plant and equipment, net | $16,312 | $19,380 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Property_Plant_and_Equipment_N3
Property, Plant and Equipment, Net - Additional Information (Detail) (USD $) | 3 Months Ended |
In Millions, unless otherwise specified | Sep. 30, 2013 |
Property Plant And Equipment [Abstract] | ' |
Aggregate expense related to fixed assets sold or written-off | $0.50 |
Goodwill_and_Intangible_Assets2
Goodwill and Intangible Assets, Net - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | 1 Months Ended | |||||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Aug. 31, 2012 | Aug. 31, 2012 | |
Patents [Member] | Patents [Member] | World Heart [Member] | World Heart [Member] | |||||
Minimum [Member] | Maximum [Member] | In Process Research and Development [Member] | ||||||
Finite-Lived Intangible Assets [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Acquired goodwill | ' | ' | ' | ' | ' | ' | $1,200,000 | ' |
Estimated useful life | ' | ' | ' | ' | '8 years | '16 years | ' | ' |
Amortization expense | 129,000 | 43,000 | 375,000 | 123,000 | ' | ' | ' | ' |
Business combination indefinite lived intangible assets work in progress | ' | ' | ' | ' | ' | ' | ' | $2,500,000 |
Goodwill_and_Intangible_Assets3
Goodwill and Intangible Assets, Net - Summary of Gross Carrying Amount of Amortizable Intangible Assets and Related Accumulated Amortization (Detail) (Patents [Member], USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Patents [Member] | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Gross Carrying Amount | $6,449 | $5,865 |
Accumulated Amortization | ($981) | ($606) |
Other_Accrued_Liabilities_Summ
Other Accrued Liabilities - Summary of Other Accrued Liabilities (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Payables And Accruals [Abstract] | ' | ' |
Accrued payroll and other employee costs | $9,240 | $8,818 |
Accrued material purchases | 3,495 | 5,628 |
Accrued professional fees | 3,037 | 1,340 |
Accrued research and development costs | 2,071 | 3,132 |
Accrued interest payable | 1,482 | 211 |
Accrued VAT | 2,253 | 1,212 |
Other accrued expenses | 4,116 | 1,679 |
Total other accrued liabilities | $25,694 | $22,020 |
Other_Accrued_Liabilities_Addi
Other Accrued Liabilities - Additional Information (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Payables And Accruals [Abstract] | ' | ' |
Accrued payroll and other employee costs | $4.60 | $5.90 |
Debt_Additional_Information_De
Debt - Additional Information (Detail) (USD $) | 9 Months Ended | |||
Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2012 | Dec. 15, 2010 | |
Debt Instrument [Line Items] | ' | ' | ' | ' |
Maturity of convertible notes | 15-Dec-17 | ' | ' | ' |
Interest of convertible notes | 3.50% | ' | ' | ' |
Aggregate principal amount of convertible senior notes | $143,750,000 | $143,750,000 | ' | $143,750,000 |
Payable semi annually in arrear | 'June 15 and December 15 | ' | ' | ' |
Conversion of shares | 10 | ' | ' | ' |
Principal amount of convertible notes | 1,000 | ' | ' | ' |
Initial conversion price | $100 | ' | ' | ' |
Principal amount of the Convertible Notes part of repurchase price | 100.00% | ' | ' | ' |
Principal amount of Convertible Notes part of owners | 25.00% | ' | ' | ' |
Coupon rate | 3.50% | ' | 3.50% | ' |
Effective interest rate on debt borrowing | 12.50% | ' | ' | ' |
Number of shares issuable upon conversion of the Convertible Notes | 1,437,500 | ' | ' | ' |
Convertible value of instrument for convertible debt | 105,200,000 | ' | ' | ' |
Fair value of Convertible Notes | $160,300,000 | ' | ' | ' |
Common Shares [Member] | ' | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' | ' |
Closing price | $73.19 | ' | ' | ' |
Debt_Summary_of_Convertible_No
Debt - Summary of Convertible Notes and Equity Component (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | Dec. 15, 2010 |
In Thousands, unless otherwise specified | |||
Debt Disclosure [Abstract] | ' | ' | ' |
Principal amount | $143,750 | $143,750 | $143,750 |
Unamortized discount | -38,405 | -43,435 | ' |
Net carrying amount | 105,345 | 100,315 | ' |
Equity component | $55,038 | $55,038 | ' |
Debt_Summary_of_Interest_Expen
Debt - Summary of Interest Expense Related to Convertible Notes (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Debt Disclosure [Abstract] | ' | ' | ' | ' |
Stated amount at 3.5% coupon rate | $1,258 | $1,258 | $3,774 | $3,774 |
Amortization of discount | 1,727 | 1,532 | 5,030 | 4,460 |
Amortization of deferred financing costs | 93 | 82 | 270 | 239 |
Convertible Notes interest expense, Net | $3,078 | $2,872 | $9,074 | $8,473 |
Debt_Summary_of_Interest_Expen1
Debt - Summary of Interest Expense Related to Convertible Notes (Parenthetical) (Detail) | Sep. 30, 2013 | Sep. 30, 2012 |
Debt Disclosure [Abstract] | ' | ' |
Coupon rate | 3.50% | 3.50% |
Stockholders_Equity_Additional
Stockholders' Equity - Additional Information (Detail) (USD $) | 0 Months Ended | 1 Months Ended | 9 Months Ended | |||
In Millions, except Share data, unless otherwise specified | Mar. 12, 2013 | Mar. 13, 2013 | Mar. 18, 2013 | Mar. 31, 2013 | Sep. 30, 2013 | Sep. 30, 2012 |
Schedule Of Stockholders Equity [Line Items] | ' | ' | ' | ' | ' | ' |
Offering price, per share | $86.45 | ' | ' | $86.45 | ' | ' |
Net sales price, per share | $81.91 | ' | ' | ' | ' | ' |
Shares offered under underwriting agreement | 1,500,000 | ' | ' | ' | ' | ' |
Additional shares offered under underwriting agreement | ' | 225,000 | ' | ' | ' | ' |
Issuance of common stock pursuant to public offering, net of offering costs | ' | ' | $141 | $141 | ' | ' |
Common stock issued upon the exercise of stock options | ' | ' | ' | ' | 119,654 | 65,808 |
Common stock upon the vesting of restricted stock units | ' | ' | ' | ' | 31,676 | 160,830 |
World Heart [Member] | ' | ' | ' | ' | ' | ' |
Schedule Of Stockholders Equity [Line Items] | ' | ' | ' | ' | ' | ' |
Acquisition of share | ' | ' | ' | ' | ' | 82,532 |
ShareBased_Compensation_Alloca
Share-Based Compensation - Allocation of Share-Based Compensation Expense (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' | ' |
Recorded share-based compensation expense | $7,065 | $4,893 | $16,442 | $14,947 |
Cost of Revenue [Member] | ' | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' | ' |
Recorded share-based compensation expense | 828 | 698 | 1,970 | 2,451 |
Selling, General and Administrative [Member] | ' | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' | ' |
Recorded share-based compensation expense | 3,951 | 2,746 | 9,169 | 8,234 |
Research and Development [Member] | ' | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' | ' |
Recorded share-based compensation expense | $2,286 | $1,449 | $5,303 | $4,262 |
ShareBased_Compensation_Additi
Share-Based Compensation - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | 9 Months Ended | 1 Months Ended | 9 Months Ended | 1 Months Ended | |||||||||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | 31-May-12 | Sep. 30, 2013 | 31-May-12 | |
Exercise or Vesting of Share-Based Awards [Member] | Exercise or Vesting of Share-Based Awards [Member] | Restricted Stock Units (RSUs) [Member] | Restricted Stock Units (RSUs) [Member] | Restricted Stock Units (RSUs) [Member] | Restricted Stock Units (RSUs) [Member] | Performance-Based Unit (PSUs) [Member] | 2012 Plan Award [Member] | 2012 Plan Award [Member] | Full Value Awards [Member] | ||||||
Minimum [Member] | Maximum [Member] | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Common stock reserved for issuance under 2012 incentive award plan | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,375,000 | ' | 1,275,000 |
Stock options issued | 0 | 0 | 7,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 301,812 | ' |
Stock options outstanding | 178,000 | ' | 178,000 | ' | 291,000 | ' | ' | ' | ' | ' | ' | ' | ' | 301,812 | ' |
Share issued upon vesting of awards | ' | ' | 119,654 | 65,808 | ' | ' | ' | ' | ' | ' | ' | ' | ' | 6,638 | ' |
Performance based option vesting period | ' | ' | ' | ' | ' | '4 years | ' | ' | ' | '3 years | '4 years | ' | ' | ' | ' |
Option expiry period | ' | ' | '10 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Weighted average grant date fair value per share option | ' | ' | $38.51 | $43.83 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Aggregate Intrinsic value options | ' | ' | ' | ' | ' | $7,700,000 | $3,300,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Cash received from options exercised | ' | ' | 3,378,000 | 2,316,000 | ' | 3,400,000 | 2,300,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Unrecognized compensation expense related to non-vested option awards | ' | ' | ' | ' | ' | 400,000 | ' | 21,500,000 | ' | ' | ' | ' | ' | ' | ' |
Recognized over a weighted average period | ' | ' | ' | ' | ' | '1 year 3 months 18 days | ' | '1 year 4 months 24 days | ' | ' | ' | ' | ' | ' | ' |
Contingent right to receive share of common stock | ' | ' | ' | ' | ' | ' | ' | 1 | ' | ' | ' | ' | ' | ' | ' |
RSU's outstanding | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 16,700 | ' | ' | ' |
Restricted stock units vested intrinsic value | ' | ' | ' | ' | ' | ' | ' | $2,900,000 | $14,300,000 | ' | ' | ' | ' | ' | ' |
Weighted average grant date fair value per share other than option | ' | ' | ' | ' | ' | ' | ' | $90.50 | $85.85 | ' | ' | ' | ' | ' | ' |
ShareBased_Compensation_Weight
Share-Based Compensation - Weighted Average Assumptions Used for Options Issued (Detail) | 9 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ' | ' |
Dividend yield | 0.00% | 0.00% |
Expected volatility | 40.00% | 57.00% |
Risk-free interest rate | 1.15% | 1.00% |
Estimated holding period (years) | '6 years 3 months | '6 years 3 months |
ShareBased_Compensation_Summar
Share-Based Compensation - Summary of Options Granted Under All Plans (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Number of Options | ' | ' | ' | ' |
Outstanding at December 31, 2012 | ' | ' | 291,000 | ' |
Granted | 0 | 0 | 7,000 | ' |
Exercised | ' | ' | -119,654 | -65,808 |
Forfeited | ' | ' | ' | ' |
Expired | ' | ' | ' | ' |
Outstanding at September 30, 2013 | 178,000 | ' | 178,000 | ' |
Exercisable at September 30, 2013 | 150,000 | ' | 150,000 | ' |
Weighted Average Exercise Price | ' | ' | ' | ' |
Outstanding at December 31, 2012 | ' | ' | $36.70 | ' |
Granted | ' | ' | $95.05 | ' |
Exercised | ' | ' | $28.23 | ' |
Forfeited | ' | ' | ' | ' |
Expired | ' | ' | ' | ' |
Outstanding at September 30, 2013 | $40.88 | ' | $40.88 | ' |
Exercisable at September 30, 2013 | $34.71 | ' | $34.71 | ' |
Weighted Average Remaining Contractual Life | ' | ' | ' | ' |
Outstanding at September 30, 2013 | ' | ' | '4 years 7 months 24 days | ' |
Exercisable at September 30, 2013 | ' | ' | '4 years 4 days | ' |
Aggregate Intrinsic Value | ' | ' | ' | ' |
Outstanding at September 30, 2013 | $6,032 | ' | $6,032 | ' |
Exercisable at September 30, 2013 | $5,806 | ' | $5,806 | ' |
ShareBased_Compensation_Summar1
Share-Based Compensation - Summary of RSU's (Detail) (Restricted Stock Units (RSUs) [Member], USD $) | 9 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2013 |
Restricted Stock Units (RSUs) [Member] | ' |
Number of Options | ' |
Outstanding at December 31, 2012 | 547 |
Granted | 108 |
Vested/Exercised | -31 |
Forfeited | -15 |
Expired | ' |
Outstanding at September 30, 2013 | 609 |
Exercisable at September 30, 2013 | ' |
Weighted Average Remaining Contractual Life | ' |
Outstanding at September 30, 2013 | '1 year 7 months 17 days |
Exercisable at September 30, 2013 | ' |
Aggregate Intrinsic Value | ' |
Aggregate Intrinsic Value, Outstanding at September 30, 2013 | $44,560 |
Aggregate Intrinsic Value, Exercisable at September 30, 2013 | ' |
Net_Loss_Per_Common_Share_Anti
Net Loss Per Common Share - Anti-Dilutive Securities Excluded from Computation of Earnings Per Share (Detail) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Conversion of Convertible Senior Notes [Member] | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Anti-dilutive securities excluded | 1,438 | 1,438 | 1,438 | 1,438 |
Exercise or Vesting of Share-Based Awards [Member] | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Anti-dilutive securities excluded | 787 | 852 | 787 | 852 |
Business_Segment_Geographic_Ar2
Business Segment, Geographic Areas and Major Customers - Additional Information (Detail) | 3 Months Ended | 9 Months Ended |
Sep. 30, 2013 | Sep. 30, 2013 | |
Customer | Segment | |
Customer | ||
Segment Reporting [Abstract] | ' | ' |
Number of reportable segments | ' | 1 |
Number of customers exceeding ten percent of sales | 0 | 0 |
Business_Segment_Geographic_Ar3
Business Segment, Geographic Areas and Major Customers - Product Sales by Geographic Location (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' | ' | ' |
Revenue, net | $54,800 | $22,862 | $154,875 | $78,261 |
United States [Member] | ' | ' | ' | ' |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' | ' | ' |
Revenue, net | 28,166 | 3,627 | 79,422 | 14,264 |
Germany [Member] | ' | ' | ' | ' |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' | ' | ' |
Revenue, net | 14,951 | 9,756 | 40,984 | 29,570 |
International, Excluding Germany [Member] | ' | ' | ' | ' |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' | ' | ' |
Revenue, net | $11,683 | $9,479 | $34,469 | $34,427 |
Commitments_and_Contingencies_
Commitments and Contingencies - Additional Information (Detail) (USD $) | 9 Months Ended |
In Millions, unless otherwise specified | Sep. 30, 2013 |
Commitments And Contingencies Disclosure [Abstract] | ' |
Purchase order commitments | 'Approximately $47.7 million |
Purchase order commitments | $47.70 |
Maximum period for purchase order commitments | '1 year |
Subsequent_Events_Additional_I
Subsequent Events - Additional Information (Detail) (Subsequent Event [Member], USD $) | 1 Months Ended | |
In Millions, unless otherwise specified | Oct. 17, 2013 | Oct. 31, 2013 |
sqft | ||
Subsequent Event [Line Items] | ' | ' |
Principal amount of promissory note | ' | $10 |
Rented area in square feet | 58,000 | ' |
Initial lease period | '7 years | ' |
Renewal lease period | '57 months | ' |
Annual base rent | 1.2 | ' |
Security deposit of lease | $0.30 | ' |
Notes Receivable [Member] | ' | ' |
Subsequent Event [Line Items] | ' | ' |
Interest rate on promissory note | ' | 6.00% |