Invuity (IVTY) 10-Q 5 May 16 2016 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2016	May. 02, 2016
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Mar. 31, 2016
Document Fiscal Year Focus	2,016
Document Fiscal Period Focus	Q1
Trading Symbol	IVTY
Entity Registrant Name	Invuity, Inc.
Entity Central Index Key	1,393,020
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		13,401,671

Condensed Balance Sheets

Condensed Balance Sheets - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Current assets:
Cash and cash equivalents	$ 33,864	$ 46,296
Accounts receivable, net	4,062	3,619
Inventory	5,575	5,182
Prepaid expenses and other current assets	782	923
Total current assets	44,283	56,020
Restricted cash	1,090	1,090
Property and equipment, net	8,955	9,195
Total assets	54,328	66,305
Current liabilities:
Accounts payable	1,765	2,458
Accrued and other current liabilities	4,574	4,214
Short-term debt—related party	375
Total current liabilities	6,714	6,672
Deferred rent	2,791	2,810
Long-term debt—related party	14,140	14,480
Total liabilities	$ 23,645	$ 23,962
Commitments and contingencies
Stockholders’ equity :
Preferred stock, $0.001 par value—10,000,000 shares authorized at March 31, 2016 and December 31, 2015, respectively; no shares issued and outstanding at March 31, 2016 and December 31, 2015
Common stock, $0.001 par value—100,000,000 shares authorized at March 31, 2016 and December 31, 2015, respectively;13,401,671 and 13,392,358 shares issued and outstanding at March 31, 2016 and December 31, 2015, respectively	$ 13	$ 13
Additional paid-in capital	148,387	147,937
Accumulated deficit	(117,717)	(105,607)
Total stockholders’ equity	30,683	42,343
Total liabilities, convertible preferred stock and stockholders’ equity	$ 54,328	$ 66,305

Condensed Balance Sheets (Paren

Condensed Balance Sheets (Parenthetical) - $ / shares	Mar. 31, 2016	Dec. 31, 2015
Statement Of Financial Position [Abstract]
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	13,401,671	13,392,358
Common stock, shares outstanding	13,401,671	13,392,358
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0

Condensed Statements of Operati

Condensed Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Income Statement [Abstract]
Revenue	$ 6,404	$ 4,442
Cost of goods sold	2,106	1,722
Gross profit	4,298	2,720
Operating expenses:
Research and development	2,601	1,900
Selling, general and administrative	13,320	8,933
Total operating expenses	15,921	10,833
Loss from operations	(11,623)	(8,113)
Interest expense	(505)	(368)
Interest and other income (expense), net	18	(551)
Net loss and comprehensive loss	$ (12,110)	$ (9,032)
Net loss per common share, basic and diluted	$ (0.90)	$ (12.84)
Weighted-average shares used to compute net loss per common share, basic and diluted	13,392,976	703,637

Condensed Statements of Cash Fl

Condensed Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Cash flows from operating activities:
Net loss	$ (12,110)	$ (9,032)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	484	398
Stock-based compensation	432	173
Changes in fair value of convertible preferred stock warrant liability		504
Provision for (recovery of) doubtful accounts	(11)	26
Noncash interest expense	35	56
Changes in operating assets and liabilities:
Accounts receivable	(432)	(853)
Inventory	(393)	(129)
Prepaid expenses and other current assets	141	1,110
Accounts payable	(650)	(249)
Accrued and other current liabilities	363	924
Deferred rent	(19)	131
Net cash used in operating activities	(12,160)	(6,941)
Cash flows from investing activities:
Purchases of property and equipment	(290)	(1,467)
Net cash used in investing activities	(290)	(1,467)
Cash flows from financing activities:
Proceeds from issuance of long-term debt -related party, net of issuance costs		5,000
Initial public offering issuance costs		(178)
Proceeds from issuance of common stock upon exercise of stock options	18	20
Proceeds from issuance of convertible preferred stock, net of issuance costs		22,769
Net cash provided by financing activities	18	27,611
Net increase (decrease) in cash and cash equivalents	(12,432)	19,203
Cash and cash equivalents, beginning of period	46,296	6,048
Cash and cash equivalents, end of period	33,864	25,251
Supplemental disclosures of cash flow information:
Interest paid to related party	469	313
Non-cash investing and financing activities:
Purchases of property and equipment in accounts payable and accrued liabilities	$ 32	857
Initial public offering issuance costs in accounts payable		$ 1,176

Organization and Description of

Organization and Description of Business	3 Months Ended
	Mar. 31, 2016
Accounting Policies [Abstract]
Organization and Description of Business	1. Organization and Description of Business Invuity, Inc. (the “Company”) was incorporated in California on November 29, 2004 and reincorporated in Delaware in May 2015. The Company is a commercial-stage medical technology company that utilizes its proprietary Intelligent Photonics technology to develop single-use and reusable illuminated surgical devices, which provide surgeons with illumination and direct visualization of surgical cavities during open minimally invasive and minimal access procedures. The Company’s manufacturing, development and management facilities are located in San Francisco, California. Liquidity The Company has incurred net losses from operations since inception and has an accumulated deficit of $117.7 million as of March 31, 2016. The Company expects to incur additional losses and negative cash flows for the foreseeable future. Management believes that its cash and cash equivalents at March 31, 2016 and additional borrowings available under its accounts receivable credit facility entered into in February 2015 will provide sufficient funds to enable the Company to meet its operating plan through at least the next twelve months. However, if the Company’s anticipated operating results are not achieved in future periods, additional debt or equity financing may need to be raised, or planned expenditures may need to be reduced. Basis of Presentation The accompanying unaudited condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and in accordance with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. The unaudited interim condensed financial statements have been prepared on the same basis as the annual financial statements. In the opinion of management, the accompanying unaudited condensed financial statements reflect all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair statement. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the audited financial statements and notes thereto included in the Company’s annual report dated December 31, 2015 and filed with the U.S Securities and Exchange Commission (the “SEC”). The results for the three months ended March 31, 2016 are not necessarily indicative of the results expected for the full fiscal year or any other periods. Out-of-Period Adjustments During the three months ended March 31, 2015, the Company recorded an out-of-period adjustment to increase the fair value of the convertible preferred stock warrant liability, which was incorrectly valued at December 31, 2014 due to an error in the expected term assumption. The correction of this error resulted in an increase to the Company’s net loss of $370,000 for the three months ended March 31, 2015 and a corresponding increase to the convertible preferred stock warrant liability. Management has assessed the impact of the adjustment and does not believe that the amount is material to any prior period financial statements, and the impact of correcting the error in the three months ended March 31, 2015 is not material to those financial statements. As a result, the Company has not restated any prior period amounts.

Summary of Significant Accounti

Summary of Significant Accounting Policies	3 Months Ended
	Mar. 31, 2016
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	2. Summary of Significant Accounting Policies Use of Estimates The Company’s financial statements have been prepared in conformity with U.S. GAAP. The preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, management evaluates its estimates, including those related to revenue recognition, fair value of assets and liabilities, inventory, income taxes, convertible preferred stock and related warrants, common stock prior to the Company’s Initial Public Offering “IPO”, and stock-based compensation. Actual results could differ from those estimates and assumptions. Cash Equivalents Cash equivalents consist of short-term, highly liquid investments with original maturities of three months or less from the date of purchase. Cash equivalents consist primarily of amounts invested in money market funds. Restricted Cash Restricted cash represents a certificate of deposit held at a financial institution as collateral for a letter of credit related to the Company’s facility lease in San Francisco, California. Fair Value of Financial Instruments The carrying amounts of the Company’s financial instruments, including cash equivalents, accounts receivable and accounts payable, approximate fair value due to their relatively short maturities. As of March 31, 2016 and December 31, 2015, based on Level 2 inputs and the borrowing rates available to the Company for loans with similar terms and consideration of the Company’s credit risk, the carrying value of the Company’s long-term debt approximates its fair value. Customer Concentration Significant customers are those which represent 10% or more of the Company’s total revenue for each period presented in the condensed statements of operations and comprehensive loss or 10% or more of the Company’s net accounts receivable balance at each respective balance sheet date. For the three months ended March 31, 2016, the Company had no customers that represented 10% or more of its revenue or accounts receivable balances. For the three months ended March 31, 2015, the Company had no customers that represented 10% or more of its revenue and one customer that represented 10% of its accounts receivable balance. Convertible Preferred Stock Warrant Liability Freestanding warrants for shares that were contingently redeemable were classified as liabilities on the balance sheet at their estimated fair value because the shares underlying the warrants may obligate the Company to transfer assets to the holders at a future date under certain circumstances, such as a deemed liquidation event. The warrants were subject to remeasurement at each balance sheet date and the change in fair value, if any, was recognized as interest and other income, net in the condensed statements of operations and comprehensive loss. The Company adjusted the liability for changes in fair value until the completion of its IPO, at which time all convertible preferred stock warrants were converted into warrants to purchase common stock and the liability was reclassified to additional paid-in capital. Revenue Recognition The Company’s revenue is generated from the sale of its products to hospitals and medical centers through direct sales representatives and independent sales agents. The Company recognizes revenue when all of the following criteria are met: · persuasive evidence of an arrangement exists; · the sales price is fixed or determinable; · collection of the relevant receivable is reasonably assured at the time of sale; and · delivery has occurred. The Company recognizes revenue when title to the goods and risk of loss transfers to the customer, which is upon shipment of the product under the Company’s standard terms and conditions. Shipping and handling costs billed to the customer are recorded in revenue. Segment Reporting The Company manages its operations as a single operating segment for the purposes of assessing performance and making operating decisions. All of the Company’s assets are maintained in the United States. The Company derives its revenue from sales to customers in the United States, based upon the billing address of the customer. Net loss per Common Share Basic net loss per common share is calculated by dividing the net loss by the weighted-average number of shares of common stock outstanding during the period, without consideration of potentially dilutive securities. Diluted net loss per common share is the same as basic net loss per common share since the effect of potentially dilutive securities are anti-dilutive. Shares subject to repurchase are excluded from the weighted-average shares. Recent Accounting Pronouncements · In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers (Topic 606) Revenue Recognition Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date In March 2016 the FASB issued ASU No. 2016-08 , Revenue from Contracts with Customers (Topic 606): Principal Versus Agent Considerations (Reporting Revenue Gross Versus Net), In April 2016 the FASB issued ASU No. 2016-10 , Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing The Company has not determined the potential effects of this ASU on its financial statements. · In July 2015, the FASB issued ASU No. 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory · In August 2014, the FASB issued ASU No. 2014-15, Disclosure of Uncertainties About an Entity’s Ability to Continue as a Going Concern · In January 2016, the FASB issued ASU 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities · In February 2016, the FASB issued ASU 2016-02 – Leases Leases · In March 2016 the FASB issued Accounting Standards Update (ASU) No. 2016-09, Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting

Fair Value Measurements

Fair Value Measurements	3 Months Ended
	Mar. 31, 2016
Fair Value Disclosures [Abstract]
Fair Value Measurements	3. Fair Value Measurements The Company discloses and recognizes the fair value of its assets and liabilities using a hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). The guidance establishes three levels of the fair value hierarchy as follows: Level 1 —Inputs are unadjusted quoted prices in active markets for identical assets or liabilities at the measurement date. Level 2 —Inputs (other than quoted market prices included in Level 1) are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the instrument’s anticipated life. Level 3 —Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model. The Company’s financial instruments consist of Level 1 assets and Level 3 liabilities. Where quoted prices are available in an active market, securities are classified as Level 1. Level 1 assets consist primarily of highly liquid money market funds that are included in cash and cash equivalents and restricted cash. Level 3 liabilities that were measured at fair value on a recurring basis consisted of the convertible preferred stock warrant liability, which was measured using the probability weighted expected return method that calculated the probability of the Company going public or being acquired, and the option-pricing method for remaining private in the near to mid-term. Upon completion of the company’s IPO, the convertible preferred stock warrants were converted into common stock warrants and the fair value of the liability of $0.6 million was transferred to additional paid-in capital. The warrants are no longer subject to remeasurement. The following table sets forth the fair value of the Company’s financial assets and liabilities measured at fair value on a recurring basis based on the three-tier fair value hierarchy (in thousands): March 31, 2016 Level 1 Level 2 Level 3 Total Assets Money market funds $ 32,779 $ — $ — $ 32,779 $ 32,779 $ — $ — $ 32,779 December 31, 2015 Level 1 Level 2 Level 3 Total Assets Money market funds $ 44,750 $ — $ — $ 44,750 $ 44,750 $ - $ - $ 44,750 The following table sets forth a summary of the changes in the fair value of the convertible preferred stock warrant liability, the Company’s Level 3 financial liability, which is measured on a recurring basis (in thousands): Three Months ended March 31, 2016 2015 Beginning balance $ — $ 136 Issuance of convertible preferred stock warrants — — Change in fair value recorded in interest and other income (expense), net — 504 Ending balance $ — $ 640

Balance Sheet Components

Balance Sheet Components	3 Months Ended
	Mar. 31, 2016
Organization Consolidation And Presentation Of Financial Statements [Abstract]
Balance Sheet Components	4. Balance sheet components Inventory Inventory consisted of the following (in thousands): March 31, 2016 December 31, 2015 Raw materials $ 970 $ 1,000 Work-in-process 945 798 Finished goods 3,660 3,384 Total inventory $ 5,575 $ 5,182 Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following (in thousands): March 31, 2016 December 31, 2015 Prepaid expenses $ 745 $ 907 Other 37 16 Total prepaid expenses and other current assets $ 782 $ 923 Property and Equipment, Net Property and equipment, net, consisted of the following (in thousands): March 31, 2016 December 31, 2015 Computer equipment and software $ 1,328 $ 1,081 Laboratory and manufacturing equipment 1,722 1,544 Furniture and fixtures 1,452 1,445 Leasehold improvements 7,106 7,106 Assets under construction 72 260 Total property and equipment, gross 11,680 11,436 Less: accumulated depreciation and amortization (2,725 ) (2,241 ) Total property and equipment, net $ 8,955 $ 9,195 Depreciation and amortization expense was $0.5 million and $0.4 million for the three months ended March 31, 2016 and 2015, respectively. Accrued and Other Current Liabilities Accrued and other current liabilities consisted of the following (in thousands): March 31, 2016 December 31, 2015 Accrued payroll-related expenses $ 3,266 $ 3,052 Accrued independent sales agent commissions 241 158 Accrued professional fees 426 373 Accrued sales and marketing expenses 61 45 Deferred rent 261 261 Other 319 325 Total accrued and other current liabilities $ 4,574 $ 4,214

Stock Option Plans

Stock Option Plans	3 Months Ended
	Mar. 31, 2016
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Stock Option Plans	5. Stock Option Plans In April 2015, the Company’s board of directors and stockholders approved the 2015 Equity Incentive plan (the “2015 Plan”), effective June 11, 2015, covering incentive stock options, nonstatutory stock options and restricted stock awards that may be granted to employees, directors and consultants. During the three months ended March 31, 2016, the Company granted to employees 663,350 options with a weighted average grant date fair value of $7.41 per share and 4,000 shares were granted to non-employees. There were no options granted during the three months ended March 31, 2015 to either employees or consultants. The aggregate intrinsic value of options exercised was $55,500 and $0, respectively. The weighted-average remaining contractual life of options outstanding was 7.4 and 7.8 years at March 31, 2016 and December 31, 2015, respectively. For both March 31, 2016 and December 31, 2015, the weighted-average remaining contractual life was 7.3 and 7.7 years, respectively for vested and expected to vest options. In addition, during the three months ended March 31, 2016, the Company granted 143,000 restricted stock units (RSUs) to executives with a grant date fair value of $1.1 million. The RSUs have a five year term and vest twenty percent annually each February 15th. Stock‑Based Compensation The fair value of stock options granted to employees is amortized on a straight-line basis over the requisite service period of the award. Stock‑based compensation related to stock options granted to non-employees is recognized as the stock options are earned. The company recognized total employee –related stock compensation expense of $409,000 and $163,000 for the three months ended March 31, 2016 and 2015, respectively. In addition, the company recognized non-employee stock compensation expense of $22,900 and $10,000 for the corresponding three month periods ended March 31, 2016 and 2015 respectively. The following table summarizes stock‑based compensation expense related to stock options and restricted stock units for the three months ended March 31, 2016 and 2015 included in the condensed statements of operations and comprehensive loss (in thousands): Three Months Ended March 31, 2016 2015 Cost of revenue $ 26 $ 17 Research and development 99 95 Selling, general and administrative 307 61 Total stock-based compensation expense $ 432 $ 173 As of March 31, 2016, unrecognized compensation expense related to unvested options, net of estimated forfeitures, was $5.5 million, which the Company expects to recognize on a straight‑line basis over a weighted‑average period of 4.0 years. Unrecognized compensation expense related to unvested RSUs, net of estimated forfeitures, was $0.8 million, which the Company expects to recognize on a straight‑line basis over a weighted‑average period of 4.9 years

Net Loss per Common Share

Net Loss per Common Share	3 Months Ended
	Mar. 31, 2016
Earnings Per Share [Abstract]
Net Loss per Common Share	6. Net Loss per Common Share Prior to the Company’s IPO, it computed net income (loss) per share of common stock in conformity with the two-class method required for participating securities. The Company considered all series of the Company’s convertible preferred stock to be participating securities as the holders of the convertible preferred stock were entitled to receive a noncumulative dividend on a pari passu basis in the event that a dividend is paid on common stock. In accordance with the two-class method, earnings allocated to convertible preferred stock were excluded from the computation of net income per common share, basic and diluted. The holders of all series of convertible preferred stock did not have a contractual obligation to share in the losses of the Company. As such, the Company’s net losses for the three months ended March 31, 2015 were not allocated to these participating securities. Upon the closing of the Company’s IPO in June 2015, all 7,652,615 shares of convertible preferred stock then outstanding converted into 7,979,332 shares of common stock, which includes an aggregate of 326,717 additional shares of common stock related to anti-dilution adjustments upon conversion of the convertible preferred stock. As the Company had net losses for all the periods presented, all potentially dilutive common securities were determined to be anti-dilutive. The following table sets forth the computation of the basic and diluted net loss per share (in thousands, except share and per share data): Three Months Ended March 31, 2016 2015 Numerator: Net loss $ (12,110 ) $ (9,032 ) Denominator: Weighted-average common shares outstanding 13,399,949 720,874 Less: weighted-average unvested common shares subject to repurchase (6,973 ) (17,237 ) Weighted-average shares used to compute net loss per common share, basic and diluted 13,392,976 703,637 Net loss per common share, basic and diluted $ (0.90 ) $ (12.84 ) The following outstanding shares of potentially dilutive securities have been excluded from diluted net loss per share for the three months ended March 31, 2016 and 2015 because their inclusion would be anti‑dilutive: March 31, 2016 2015 Convertible preferred stock on an as-converted basis — 7,842,408 Options to purchase common stock 2,618,303 1,359,142 Restricted Stock Units 130,000 — Warrants to purchase common stock 137,007 3,532 Warrants to purchase convertible preferred stock on an as-converted basis — 134,570 Total 2,885,310 9,339,652

Summary of Significant Accoun12

Summary of Significant Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2016
Accounting Policies [Abstract]
Use of Estimates	Use of Estimates The Company’s financial statements have been prepared in conformity with U.S. GAAP. The preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, management evaluates its estimates, including those related to revenue recognition, fair value of assets and liabilities, inventory, income taxes, convertible preferred stock and related warrants, common stock prior to the Company’s Initial Public Offering “IPO”, and stock-based compensation. Actual results could differ from those estimates and assumptions.
Cash Equivalents	Cash Equivalents Cash equivalents consist of short-term, highly liquid investments with original maturities of three months or less from the date of purchase. Cash equivalents consist primarily of amounts invested in money market funds.
Restricted Cash	Restricted Cash Restricted cash represents a certificate of deposit held at a financial institution as collateral for a letter of credit related to the Company’s facility lease in San Francisco, California.
Fair Value of Financial Instruments	Fair Value of Financial Instruments The carrying amounts of the Company’s financial instruments, including cash equivalents, accounts receivable and accounts payable, approximate fair value due to their relatively short maturities. As of March 31, 2016 and December 31, 2015, based on Level 2 inputs and the borrowing rates available to the Company for loans with similar terms and consideration of the Company’s credit risk, the carrying value of the Company’s long-term debt approximates its fair value.
Customer Concentration	Customer Concentration Significant customers are those which represent 10% or more of the Company’s total revenue for each period presented in the condensed statements of operations and comprehensive loss or 10% or more of the Company’s net accounts receivable balance at each respective balance sheet date. For the three months ended March 31, 2016, the Company had no customers that represented 10% or more of its revenue or accounts receivable balances. For the three months ended March 31, 2015, the Company had no customers that represented 10% or more of its revenue and one customer that represented 10% of its accounts receivable balance.
Convertible Preferred Stock Warrant Liability	Convertible Preferred Stock Warrant Liability Freestanding warrants for shares that were contingently redeemable were classified as liabilities on the balance sheet at their estimated fair value because the shares underlying the warrants may obligate the Company to transfer assets to the holders at a future date under certain circumstances, such as a deemed liquidation event. The warrants were subject to remeasurement at each balance sheet date and the change in fair value, if any, was recognized as interest and other income, net in the condensed statements of operations and comprehensive loss. The Company adjusted the liability for changes in fair value until the completion of its IPO, at which time all convertible preferred stock warrants were converted into warrants to purchase common stock and the liability was reclassified to additional paid-in capital.
Revenue Recognition	Revenue Recognition The Company’s revenue is generated from the sale of its products to hospitals and medical centers through direct sales representatives and independent sales agents. The Company recognizes revenue when all of the following criteria are met: · persuasive evidence of an arrangement exists; · the sales price is fixed or determinable; · collection of the relevant receivable is reasonably assured at the time of sale; and · delivery has occurred. The Company recognizes revenue when title to the goods and risk of loss transfers to the customer, which is upon shipment of the product under the Company’s standard terms and conditions. Shipping and handling costs billed to the customer are recorded in revenue.
Segment Reporting	Segment Reporting The Company manages its operations as a single operating segment for the purposes of assessing performance and making operating decisions. All of the Company’s assets are maintained in the United States. The Company derives its revenue from sales to customers in the United States, based upon the billing address of the customer.
Net loss per Common Share	Net loss per Common Share Basic net loss per common share is calculated by dividing the net loss by the weighted-average number of shares of common stock outstanding during the period, without consideration of potentially dilutive securities. Diluted net loss per common share is the same as basic net loss per common share since the effect of potentially dilutive securities are anti-dilutive. Shares subject to repurchase are excluded from the weighted-average shares.
Recent Accounting Pronouncements	Recent Accounting Pronouncements · In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers (Topic 606) Revenue Recognition Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date In March 2016 the FASB issued ASU No. 2016-08 , Revenue from Contracts with Customers (Topic 606): Principal Versus Agent Considerations (Reporting Revenue Gross Versus Net), In April 2016 the FASB issued ASU No. 2016-10 , Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing The Company has not determined the potential effects of this ASU on its financial statements. · In July 2015, the FASB issued ASU No. 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory · In August 2014, the FASB issued ASU No. 2014-15, Disclosure of Uncertainties About an Entity’s Ability to Continue as a Going Concern · In January 2016, the FASB issued ASU 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities · In February 2016, the FASB issued ASU 2016-02 – Leases Leases · In March 2016 the FASB issued Accounting Standards Update (ASU) No. 2016-09, Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting

Fair Value Measurements (Tables

Fair Value Measurements (Tables)	3 Months Ended
	Mar. 31, 2016
Fair Value Disclosures [Abstract]
Financial Assets and Liabilities Measured at Fair Value on Recurring Basis Based on Three-Tier Fair Value Hierarchy	The following table sets forth the fair value of the Company’s financial assets and liabilities measured at fair value on a recurring basis based on the three-tier fair value hierarchy (in thousands): March 31, 2016 Level 1 Level 2 Level 3 Total Assets Money market funds $ 32,779 $ — $ — $ 32,779 $ 32,779 $ — $ — $ 32,779 December 31, 2015 Level 1 Level 2 Level 3 Total Assets Money market funds $ 44,750 $ — $ — $ 44,750 $ 44,750 $ - $ - $ 44,750
Summary of Changes in Fair Value of Convertible Preferred Stock Warrant Liability	The following table sets forth a summary of the changes in the fair value of the convertible preferred stock warrant liability, the Company’s Level 3 financial liability, which is measured on a recurring basis (in thousands): Three Months ended March 31, 2016 2015 Beginning balance $ — $ 136 Issuance of convertible preferred stock warrants — — Change in fair value recorded in interest and other income (expense), net — 504 Ending balance $ — $ 640

Balance Sheet Components (Table

Balance Sheet Components (Tables)	3 Months Ended
	Mar. 31, 2016
Organization Consolidation And Presentation Of Financial Statements [Abstract]
Schedule of Inventory	Inventory consisted of the following (in thousands): March 31, 2016 December 31, 2015 Raw materials $ 970 $ 1,000 Work-in-process 945 798 Finished goods 3,660 3,384 Total inventory $ 5,575 $ 5,182
Schedule of Prepaid Expenses and Other Current Assets	Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following (in thousands): March 31, 2016 December 31, 2015 Prepaid expenses $ 745 $ 907 Other 37 16 Total prepaid expenses and other current assets $ 782 $ 923
Schedule of Property and Equipment, Net	Property and equipment, net, consisted of the following (in thousands): March 31, 2016 December 31, 2015 Computer equipment and software $ 1,328 $ 1,081 Laboratory and manufacturing equipment 1,722 1,544 Furniture and fixtures 1,452 1,445 Leasehold improvements 7,106 7,106 Assets under construction 72 260 Total property and equipment, gross 11,680 11,436 Less: accumulated depreciation and amortization (2,725 ) (2,241 ) Total property and equipment, net $ 8,955 $ 9,195
Schedule of Accrued and Other Current Liabilities	Accrued and other current liabilities consisted of the following (in thousands): March 31, 2016 December 31, 2015 Accrued payroll-related expenses $ 3,266 $ 3,052 Accrued independent sales agent commissions 241 158 Accrued professional fees 426 373 Accrued sales and marketing expenses 61 45 Deferred rent 261 261 Other 319 325 Total accrued and other current liabilities $ 4,574 $ 4,214

Stock Option Plans (Tables)

Stock Option Plans (Tables)	3 Months Ended
	Mar. 31, 2016
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Summary of Stock-based Compensation Expense Related to Stock Options and Restricted Stock Units Included in Condensed Statements of Operations and Comprehensive Loss	The following table summarizes stock‑based compensation expense related to stock options and restricted stock units for the three months ended March 31, 2016 and 2015 included in the condensed statements of operations and comprehensive loss (in thousands): Three Months Ended March 31, 2016 2015 Cost of revenue $ 26 $ 17 Research and development 99 95 Selling, general and administrative 307 61 Total stock-based compensation expense $ 432 $ 173

Net Loss per Common Share (Tabl

Net Loss per Common Share (Tables)	3 Months Ended
	Mar. 31, 2016
Earnings Per Share [Abstract]
Schedule of Computation of Basic and Diluted Net Loss per Share	The following table sets forth the computation of the basic and diluted net loss per share (in thousands, except share and per share data): Three Months Ended March 31, 2016 2015 Numerator: Net loss $ (12,110 ) $ (9,032 ) Denominator: Weighted-average common shares outstanding 13,399,949 720,874 Less: weighted-average unvested common shares subject to repurchase (6,973 ) (17,237 ) Weighted-average shares used to compute net loss per common share, basic and diluted 13,392,976 703,637 Net loss per common share, basic and diluted $ (0.90 ) $ (12.84 )
Schedule of Potentially Dilutive Securities Outstanding Excluded from Computation of Diluted Shares Outstanding	The following outstanding shares of potentially dilutive securities have been excluded from diluted net loss per share for the three months ended March 31, 2016 and 2015 because their inclusion would be anti‑dilutive: March 31, 2016 2015 Convertible preferred stock on an as-converted basis — 7,842,408 Options to purchase common stock 2,618,303 1,359,142 Restricted Stock Units 130,000 — Warrants to purchase common stock 137,007 3,532 Warrants to purchase convertible preferred stock on an as-converted basis — 134,570 Total 2,885,310 9,339,652

Organization and Description 17

Organization and Description of Business - Additional Information (Detail) - USD ($)	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Dec. 31, 2015
Organization And Nature Of Operations [Line Items]
Accumulated deficit	$ (117,717,000)		$ (105,607,000)
Net loss	$ (12,110,000)	$ (9,032,000)
Error Correction [Member]
Organization And Nature Of Operations [Line Items]
Net loss		(370,000)
Convertible preferred stock warrant liability		$ 370,000

Summary of Significant Accoun18

Summary of Significant Accounting Policies - Additional Information (Detail)	3 Months Ended
	Mar. 31, 2016CustomerSegment	Mar. 31, 2015Customer
Significant Accounting Policies [Line Items]
Number of operating segments | Segment	1
Revenue [Member]
Significant Accounting Policies [Line Items]
Number of Customers	0	0
Revenue [Member] | Customer Concentration Risk [Member]
Significant Accounting Policies [Line Items]
Concentration risk, percentage	10.00%	10.00%
Accounts Receivable, Net [Member]
Significant Accounting Policies [Line Items]
Number of Customers	0	1
Accounts Receivable, Net [Member] | Customer Concentration Risk [Member]
Significant Accounting Policies [Line Items]
Concentration risk, percentage	10.00%	10.00%

Fair Value Measurements - Addit

Fair Value Measurements - Additional Information (Detail) $ in Millions	3 Months Ended
	Mar. 31, 2016USD ($)
Level 3 [Member] | Recurring [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Reclassification of convertible preferred stock warrant liability to additional paid-in capital upon conversion of preferred stock warrants into common stock warrants	$ 0.6

Fair Value Measurements - Finan

Fair Value Measurements - Financial Assets and Liabilities Measured at Fair Value on Recurring Basis Based on Three-Tier Fair Value Hierarchy (Detail) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Assets
Assets	$ 32,779	$ 44,750
Level 1 [Member] | Recurring [Member]
Assets
Assets	32,779	44,750
Money Market Funds [Member]
Assets
Assets	32,779	44,750
Money Market Funds [Member] | Level 1 [Member] | Recurring [Member]
Assets
Assets	$ 32,779	$ 44,750

Fair Value Measurements - Summa

Fair Value Measurements - Summary of Changes in Fair Value of Convertible Preferred Stock Warrant Liability (Detail) $ in Thousands	3 Months Ended
	Mar. 31, 2015USD ($)
Fair Value Disclosures [Abstract]
Beginning balance	$ 136
Change in fair value recorded in interest and other income (expense), net	504
Ending balance	$ 640

Balance Sheet Components - Sche

Balance Sheet Components - Schedule of Inventory (Detail) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Inventory Disclosure [Abstract]
Raw materials	$ 970	$ 1,000
Work-in-process	945	798
Finished goods	3,660	3,384
Total inventory	$ 5,575	$ 5,182

Balance Sheet Components - Sc23

Balance Sheet Components - Schedule of Prepaid Expenses and Other Current Assets (Detail) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Deferred Costs Capitalized Prepaid And Other Assets Disclosure [Abstract]
Prepaid expenses	$ 745	$ 907
Other	37	16
Total prepaid expenses and other current assets	$ 782	$ 923

Balance Sheet Components - Sc24

Balance Sheet Components - Schedule of Property and Equipment, Net (Detail) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Property, Plant and Equipment [Line Items]
Total property and equipment, gross	$ 11,680	$ 11,436
Less: accumulated depreciation and amortization	(2,725)	(2,241)
Total property and equipment, net	8,955	9,195
Computer Equipment and Software [Member]
Property, Plant and Equipment [Line Items]
Total property and equipment, gross	1,328	1,081
Laboratory and Manufacturing Equipment [Member]
Property, Plant and Equipment [Line Items]
Total property and equipment, gross	1,722	1,544
Furniture and Fixtures [Member]
Property, Plant and Equipment [Line Items]
Total property and equipment, gross	1,452	1,445
Leasehold Improvements [Member]
Property, Plant and Equipment [Line Items]
Total property and equipment, gross	7,106	7,106
Assets Under Construction [Member]
Property, Plant and Equipment [Line Items]
Total property and equipment, gross	$ 72	$ 260

Balance Sheet Components - Addi

Balance Sheet Components - Additional Information (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Property Plant And Equipment [Abstract]
Depreciation and amortization	$ 484	$ 398

Balance Sheet Components - Sc26

Balance Sheet Components - Schedule of Accrued and Other Current Liabilities (Detail) - USD ($) $ in Thousands	Mar. 31, 2016	Dec. 31, 2015
Payables And Accruals [Abstract]
Accrued payroll-related expenses	$ 3,266	$ 3,052
Accrued independent sales agent commissions	241	158
Accrued professional fees	426	373
Accrued sales and marketing expenses	61	45
Deferred rent	261	261
Other	319	325
Total accrued and other current liabilities	$ 4,574	$ 4,214

Stock Option Plans - Additional

Stock Option Plans - Additional Information (Detail) - USD ($)	3 Months Ended		12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Dec. 31, 2015
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Weighted average grant date fair value of options, granted	$ 7.41
Aggregate intrinsic value of options exercised	$ 55,500	$ 0
Weighted-average remaining contractual life of options outstanding	7 years 4 months 24 days		7 years 9 months 18 days
Weighted-average remaining contractual life of options outstanding, vested and expected to vest	7 years 3 months 18 days		7 years 8 months 12 days
Stock-based compensation	$ 432,000	$ 173,000
Unrecognized compensation expense related to unvested options	$ 5,500,000
Weighted-average expected period to recognize of compensation expense, term	4 years
Restricted Stock Units (RSUs) [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Restricted stock units, granted	143,000
Restricted stock units, granted fair value	$ 1,100,000
Restricted stock units, expiration term	5 years
Restricted stock units, vesting percentage	20.00%
Weighted-average expected period to recognize of compensation expense, term	4 years 10 months 24 days
Unrecognized compensation expense related to RSUs	$ 800,000
Employees [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Stock options granted	663,350	0
Stock-based compensation	$ 409,000	$ 163,000
Non-employees [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Stock options granted	4,000
Stock-based compensation	$ 22,900	$ 10,000
Consultants [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Stock options granted		0

Stock Option Plans - Summary of

Stock Option Plans - Summary of Stock-based Compensation Expense Related to Stock Options and Restricted Stock Units Included in Condensed Statements of Operations and Comprehensive Loss (Detail) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense	$ 432	$ 173
Cost of Revenue [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense	26	17
Research and Development [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense	99	95
Selling, General and Administrative [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total stock-based compensation expense	$ 307	$ 61

Net Loss per Common Share - Add

Net Loss per Common Share - Additional Information (Detail)	Jun. 30, 2015shares
Convertible Preferred Stock [Member]
Temporary Equity [Line Items]
Convertible preferred stock, shares outstanding	7,652,615
Common Stock [Member]
Temporary Equity [Line Items]
Convertible preferred stock converted into shares of common stock	7,979,332
Common Stock [Member] | Anti-dilution Adjustments [Member]
Temporary Equity [Line Items]
Convertible preferred stock converted into shares of common stock	326,717

Net Loss per Common Share - Sch

Net Loss per Common Share - Schedule of Computation of Basic and Diluted Net Loss per Share (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Numerator:
Net loss	$ (12,110)	$ (9,032)
Denominator:
Weighted-average common shares outstanding	13,399,949	720,874
Less: weighted-average unvested common shares subject to repurchase	(6,973)	(17,237)
Weighted-average shares used to compute net loss per common share, basic and diluted	13,392,976	703,637
Net loss per common share, basic and diluted	$ (0.90)	$ (12.84)

Net Loss per Common Share - S31

Net Loss per Common Share - Schedule of Potentially Dilutive Securities Outstanding Excluded from Computation of Diluted Shares Outstanding (Detail) - shares	3 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of diluted net loss per share	2,885,310	9,339,652
Convertible Preferred Stock on an as-Converted Basis [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of diluted net loss per share		7,842,408
Options to Purchase Common Stock [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of diluted net loss per share	2,618,303	1,359,142
Restricted Stock Units [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of diluted net loss per share	130,000
Warrants to Purchase Common Stock [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of diluted net loss per share	137,007	3,532
Warrants to Purchase Convertible Preferred Stock on an as-Converted Basis [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of diluted net loss per share		134,570