Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Mar. 31, 2014 | Apr. 30, 2014 | |
Document And Entity Information [Abstract] | ' | ' |
Document Type | '10-Q | ' |
Amendment Flag | 'false | ' |
Document Period End Date | 31-Mar-14 | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q1 | ' |
Trading Symbol | 'TRIV | ' |
Entity Registrant Name | 'TriVascular Technologies, Inc. | ' |
Entity Central Index Key | '0001432732 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Non-accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 20,258,231 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | |
In Thousands, unless otherwise specified | |||
Current assets | ' | ' | |
Cash and cash equivalents | $31,409 | $38,108 | [1] |
Accounts receivable | 5,545 | 4,741 | [1] |
Inventories, net | 7,075 | 7,042 | [1] |
Prepaid expenses and other current assets | 1,950 | 2,435 | [1] |
Total current assets | 45,979 | 52,326 | [1] |
Property and equipment, net | 1,374 | 1,505 | [1] |
Goodwill | 8,259 | 8,259 | [1] |
Other intangible assets | 1,182 | 1,182 | [1] |
Other assets | 1,793 | 1,428 | [1] |
Total assets | 58,587 | 64,700 | [1] |
Current liabilities | ' | ' | |
Accounts payable | 2,172 | 1,678 | [1] |
Accrued liabilities and other | 5,441 | 6,129 | [1] |
Total current liabilities | 7,613 | 7,807 | [1] |
Notes payable | 47,695 | 44,288 | [1] |
Other long term liabilities | 5,352 | 1,413 | [1] |
Total liabilities | 60,660 | 53,508 | [1] |
Commitments and contingencies (Note 8) | ' | ' | [1] |
Convertible preferred stock | 239,990 | 239,990 | [1] |
Stockholders' deficit | ' | ' | |
Common stock, $0.01 par value - 623,000,000 shares authorized, 823,553 and 580,458 shares issued and outstanding at March 31, 2014 and December 31, 2013, respectively. | 8 | 6 | [1] |
Additional paid-in capital | 10,728 | 9,551 | [1] |
Accumulated other comprehensive income | 145 | 166 | [1] |
Accumulated deficit | -252,944 | -238,521 | [1] |
Total stockholders' deficit | -242,063 | -228,798 | [1] |
Total liabilities, convertible preferred stock and stockholders' deficit | $58,587 | $64,700 | [1] |
[1] | The year-end consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United Stated of America. |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | |
Statement Of Financial Position [Abstract] | ' | ' | |
Common stock, par value | $0.01 | $0.01 | [1] |
Common stock, shares authorized | 623,000,000 | 623,000,000 | [1] |
Common stock, shares issued | 823,553 | 580,458 | [1] |
Common stock, shares outstanding | 823,553 | 580,458 | [1] |
[1] | The year-end consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United Stated of America. |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Loss (USD $) | 3 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Income Statement [Abstract] | ' | ' |
Revenue | $7,034 | $2,942 |
Cost of goods sold | 3,665 | 1,988 |
Gross profit | 3,369 | 954 |
Operating expenses: | ' | ' |
Sales, general and administrative | 12,192 | 7,505 |
Research and development | 3,806 | 3,169 |
Total operating expenses | 15,998 | 10,674 |
Loss from operations | -12,629 | -9,720 |
Other income (expense): | ' | ' |
Interest expense | -1,689 | -1,555 |
Interest income and other income (expense), net | -82 | 19 |
Loss before income tax expense | -14,400 | -11,256 |
Provision for income tax | 23 | 27 |
Net loss | -14,423 | -11,283 |
Other comprehensive loss: | ' | ' |
Change in foreign currency translation adjustment | -20 | -76 |
Other comprehensive loss | -20 | -76 |
Comprehensive loss | ($14,443) | ($11,359) |
Net loss per share, basic and diluted | ($21.77) | ($19.65) |
Weighted average shares used to compute net loss per share, basic and diluted | 662,517 | 574,061 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | |
Cash flows from operating activities | ' | ' | |
Net loss | ($14,423) | ($11,283) | |
Adjustments to reconcile net loss to net cash used in operating activities | ' | ' | |
Depreciation and amortization of property and equipment | 141 | 378 | |
Amortization of debt issuance costs and debt discount | 154 | 109 | |
Provision for excess and obsolete inventory | 298 | 51 | |
Changes in fair value of warrants | 70 | 6 | |
Amortization of intangibles acquired in business combination | 0 | 35 | |
Stock-based compensation expense | 462 | 255 | |
Non-cash interest expense on notes payable | 303 | 290 | |
Changes in assets and liabilities | ' | ' | |
Accounts receivable | -807 | -1,109 | |
Inventories | -331 | -365 | |
Prepaid expenses and other current assets | 1,146 | -89 | |
Accounts payable | 417 | 463 | |
Accrued liabilities and other | -771 | 1 | |
Net cash used in operating activities | -13,341 | -11,258 | |
Cash flows from investing activities | ' | ' | |
Purchase of property and equipment | -10 | -128 | |
Net cash used in investing activities | -10 | -128 | |
Cash flows from financing activities | ' | ' | |
Proceeds from notes payable | 6,000 | ' | |
Payments for deferred offering costs | -814 | ' | |
Proceeds from issuance of common stock | 1,456 | 13 | |
Net cash provided by financing activities | 6,642 | 13 | |
Effects of exchange rate changes on cash | 10 | 4 | |
Net decrease in cash and cash equivalents | -6,699 | -11,369 | |
Cash and cash equivalents | ' | ' | |
Beginning of period | 38,108 | [1] | 45,393 |
End of period | 31,409 | 34,024 | |
Supplemental cash flow information | ' | ' | |
Interest paid on notes payable | 1,233 | 1,145 | |
Cash paid for income taxes | 28 | 39 | |
Significant non cash transactions | ' | ' | |
Increase in deferred revenue related to distributor agreement | 3,017 | ' | |
Unvested portion of early exercised stock options | 901 | ' | |
Unpaid deferred offering costs | 249 | ' | |
Vesting of early exercised stock options | $38 | $3 | |
[1] | The year-end consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United Stated of America. |
The_Company
The Company | 3 Months Ended | |
Mar. 31, 2014 | ||
Accounting Policies [Abstract] | ' | |
The Company | ' | |
1 | The Company | |
TriVascular Technologies, Inc. (the “Company”) was incorporated in the state of Delaware in July 2007 and began operations on March 28, 2008. The Company is a medical device company developing and commercializing innovative technologies to significantly advance minimally invasive treatment of abdominal aortic aneurysms (“AAA”). The Ovation System, the Company’s solution for the treatment of AAA through minimally invasive endovascular aortic repair (“EVAR”) is a new stent graft platform, providing an innovative and effective alternative to conventional devices. It is designed specifically to address many of the limitations associated with conventional EVAR devices and expand the pool of patients eligible for EVAR. The Company received CE Mark clearance in August 2010 and began commercial sales of its Ovation System in Europe in September 2010. In October 2012, the Company received approval from the U.S. Food and Drug Administration for the Ovation System for the treatment of AAA. | ||
As a medical device company with little commercial operating history, the Company is subject to all of the risks and expenses associated with a growing company. The Company must, among other things, respond to competitive developments, attract, retain and motivate qualified personnel, and support the expense of developing and marketing new products based on innovative technology. In the course of its development activities, the Company has sustained significant operating losses. Even if development and marketing efforts are successful, substantial time may pass before significant revenues will be realized, and during this period, the Company will require additional funds, the availability of which cannot be reasonably assured. |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Accounting Policies [Abstract] | ' | ||||||||
Summary of Significant Accounting Policies | ' | ||||||||
2 | Summary of Significant Accounting Policies | ||||||||
Basis of Presentation | |||||||||
The accompanying Consolidated Financial Statements in this Quarterly Report on Form 10-Q have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) and with the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). These financial statements include the financial position, results of operations, and cash flows of the Company, including its wholly-owned subsidiaries. All inter-company accounts and transactions have been eliminated in consolidation. | |||||||||
The interim financial data as of March 31, 2014, is unaudited and is not necessarily indicative of the results for a full year or any interim period. In the opinion of the Company’s management, the interim data includes all normal and recurring adjustments necessary for a fair statement of the Company’s financial results for the three months ended March 31, 2014. The December 31, 2013 consolidated balance sheet data was derived from audited financial statements. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to SEC rules and regulations relating to interim financial statements. | |||||||||
The accompanying Consolidated Financial Statements should be read in conjunction with the Company’s audited Consolidated Financial Statements and Notes thereto included in the Company’s final prospectus filed pursuant to Rule 424(b) under the Securities and Exchange Act of 1933, as amended, relating to the Company’s Registration Statement on Form S-1 (File No. 333-194466), filed with the SEC on April 17, 2014. | |||||||||
On April 22, 2014, the Company completed its initial public offering (“IPO”) of 7,475,000 shares of common stock, which includes the exercise in full by the underwriters in the offering of their option to purchase 975,000 additional shares of common stock, at an offering price of $12.00 per share. The Company received net proceeds of approximately $81.2 million, after deducting underwriting discounts and commissions and offering expenses. In connection with the IPO, the Company’s outstanding shares of convertible preferred stock were automatically converted into 11,601,860 shares of common stock and warrants exercisable for convertible preferred stock were automatically converted into warrants exercisable for 192,472 shares of common stock, resulting in the reclassification of the related redeemable convertible preferred stock warrant liability of $1.4 million to additional paid-in capital. | |||||||||
Use of estimates | |||||||||
The preparation of 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 consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates and such differences could be material. | |||||||||
Segment Information | |||||||||
The Company considers operating segments to be components of the Company in which separate financial information is available that is evaluated regularly by the Company’s chief operating decision maker in deciding how to allocate resources and in assessing performance. The chief operating decision maker for the Company is the Chief Executive Officer. The Chief Executive Officer reviews financial information presented on a consolidated basis, accompanied by information about revenue by geographic region, for purposes of allocating resources and evaluating financial performance. The Company has one business activity and there are no segment managers who are held accountable for operations, operating results or plans for levels or components below the consolidated unit level. Accordingly, the Company has determined that it has a single reportable and operating segment structure. The Company and its Chief Executive Officer evaluate performance based primarily on revenue in the geographic locations in which the Company operates. | |||||||||
Revenues by geography are based on the billing address of the customer. The following table sets forth revenue by geographic area (in thousands): | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
United States (U.S.) | $ | 4,602 | $ | 941 | |||||
International | 2,432 | 2,001 | |||||||
Total | $ | 7,034 | $ | 2,942 | |||||
The following table summarizes countries with revenues accounting for more than 10% of the total: | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
Germany | < 10 | % | 18 | % | |||||
Greece | < 10 | % | 10 | % | |||||
Italy | < 10 | % | 18 | % | |||||
U.S. | 65 | % | 32 | % | |||||
Long-lived assets and operating income outside the U.S. are not material; therefore disclosures have been limited to revenue. | |||||||||
Cash and Cash Equivalents | |||||||||
Cash and cash equivalents consist of demand deposit accounts and institutional money market funds held in U.S. and foreign banks. Cash equivalents consist of highly liquid investment securities with original maturities at the date of purchase of three months or less. | |||||||||
Accounts Receivable | |||||||||
Trade accounts receivable are recorded at the invoice amount and do not include interest. The Company regularly reviews accounts for collectability and establishes an allowance for probable credit losses and writes off uncollectible accounts as necessary. The Company has determined that no reserve was required at either of the periods presented. | |||||||||
Inventories | |||||||||
The Company values inventory at the lower of cost to purchase or manufacture the inventory or the market value for such inventory. Cost is determined using the standard cost method which approximates the first-in first-out method. The Company regularly reviews inventory quantities in consideration of actual loss experiences, projected future demand, and remaining shelf life to record a provision for excess and obsolete inventory when appropriate. | |||||||||
Property and Equipment | |||||||||
Property and equipment are stated at cost, net of accumulated depreciation and amortization. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. | |||||||||
The depreciation and amortization periods for the Company’s property and equipment are as follows: | |||||||||
Equipment and software | 3 years | ||||||||
Laboratory machinery and equipment | 3–5 years | ||||||||
Furniture and fixtures | 5 years | ||||||||
Leasehold improvements are amortized over the lesser of their useful lives or the remaining life of the lease. When assets are retired or otherwise disposed of, the cost and related accumulated depreciation and amortization are removed from the consolidated balance sheet and the resulting gain or loss is reflected in operations in the period realized. Cost of maintenance and repairs are charged to expense as incurred, and improvements and betterments are capitalized. | |||||||||
Goodwill and Indefinite Lived Intangible Assets | |||||||||
The Company has recorded goodwill and intangible assets on the consolidated balance sheets. The Company classifies intangible assets into three categories: (1) goodwill; (2) intangible assets with indefinite lives not subject to amortization; and (3) intangible assets with definite lives subject to amortization. | |||||||||
Goodwill and intangible assets with indefinite lives are not amortized. The Company assesses goodwill and intangible assets with indefinite lives for impairment on an annual basis in the fourth quarter of each year or more frequently if indicators of impairment exist. For the purpose of testing goodwill for impairment, the Company has determined that it has one reporting unit. | |||||||||
Deferred Offering Costs | |||||||||
Deferred offering costs, consisting of legal, accounting and other fees and costs relating to the IPO, are capitalized. The deferred offering costs were offset against the IPO proceeds upon the closing of the offering in April 2014. There were $1.2 and $0.7 million of deferred offering costs capitalized as of March 31, 2014 and December 31, 2013, respectively, in other assets on the consolidated balance sheets. | |||||||||
Convertible Preferred Stock Warrant Liability | |||||||||
Freestanding warrants related to convertible preferred stock shares that are contingently redeemable are classified as a liability on the Company’s accompanying consolidated balance sheet. The convertible preferred stock warrants are subject to re-measurement at each balance sheet date, and any change in fair value is recognized as a component of interest income and other income (expense), net. The Company continued to adjust the liability for changes in fair value until the completion of the IPO in April 2014, at which time all redeemable convertible preferred stock warrants were converted into warrants to purchase common stock and the liability was reclassified to additional paid-in capital. | |||||||||
Revenue | |||||||||
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 probable at the time of sale; and | ||||||||
• | delivery has occurred or services have been rendered. | ||||||||
For sales directly to hospitals or medical facilities, the Company recognizes revenue upon completion of a procedure, which is when the product is implanted in a patient, and a valid purchase order has been received. For distributor sales, the Company recognizes revenue at the time of shipment of product, as this represents the point that the customer has taken ownership and assumed risk of loss. The Company does not offer rights of return or price protection and has no post-delivery obligations. The Company offers rights of exchange in limited circumstances for products with a short shelf life at the time of shipment, and has established a $34,000 and $0 reserve for such exchanges included in accrued liabilities and other in the consolidated balance sheets at March 31, 2014 and December 31, 2013, respectively. | |||||||||
Income Taxes | |||||||||
The Company records income taxes using the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in the Company’s consolidated financial statements or income tax returns. In estimating future tax consequences, expected future events other than enactments or changes in the tax law or rates are considered. Valuation allowances are provided when necessary to reduce deferred tax assets to the amount expected to be realized. | |||||||||
The Company operates in various tax jurisdictions and is subject to audit by various tax authorities. The Company provides for tax contingencies whenever it is deemed probable that a tax asset has been impaired or a tax liability has been incurred for events such as tax claims or changes in tax laws. Tax contingencies are based upon their technical merits, relative tax law, and the specific facts and circumstances as of each reporting period. Changes in facts and circumstances could result in material changes to the amounts recorded for such tax contingencies. | |||||||||
The Company records uncertain tax positions on the basis of a two-step process whereby (1) a determination is made as to whether it is more likely than not that the tax positions will be sustained based on the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold the Company recognizes the largest amount of tax benefit that is greater than 50% likely to be realized upon ultimate settlement with the related tax authority. | |||||||||
Other Comprehensive Loss | |||||||||
Other comprehensive loss represents all changes in stockholders’ deficit except those resulting from investments or contributions by stockholders. The Company’s other comprehensive loss consists of its net loss and changes in accumulated other comprehensive loss, which represents foreign currency translation adjustments. | |||||||||
Currency Translation | |||||||||
The Euro is the functional currency of the Company’s wholly-owned subsidiaries in Italy and Germany and the Swiss Franc is the functional currency of the Company’s wholly-owned subsidiary in Switzerland. Accordingly, the assets and liabilities of these subsidiaries are translated into United States dollars using the current exchange rate in effect at the balance sheet date and equity accounts are translated into United States dollars using historical rates. Revenues and expenses are translated using the average exchanges rates in effect when the transactions occur. Foreign currency translation adjustments are recorded within accumulated other comprehensive loss, a separate component of stockholders’ deficit, on the consolidated balance sheets. Foreign exchange transaction gains and losses have not been material to the Company’s consolidated financial statements for all periods presented. | |||||||||
Stock-Based Compensation | |||||||||
The Company’s determination of the fair value of stock options on the date of grant utilizes the Black-Scholes option-pricing model, and is impacted by its common stock price as well as changes in assumptions regarding a number of highly complex and subjective variables. These variables include, but are not limited to, expected common stock price volatility over the term of the option awards, as well as the projected employee option exercise behaviors (expected period between stock option vesting date and stock option exercise date), risk-free interest rates and expected dividends. | |||||||||
The fair value is recognized over the period during which an optionee is required to provide services in exchange for the option award, known as the requisite service period (usually the vesting period) on a straight-line basis. Stock-based compensation expense recognized at fair value includes the impact of estimated forfeitures. The Company estimates future forfeitures at the date of grant and revises the estimates, if necessary, in subsequent periods if actual forfeitures differ from those estimates. | |||||||||
Equity instruments issued to non-employees are recorded at their fair value on the measurement date and are subject to periodic adjustments as the underlying equity instruments vest. The fair value of options granted to consultants is expensed when vested. The non-employee stock-based compensation expense was not material for all periods presented. | |||||||||
Cash flows resulting from the tax benefits for tax deductions resulting from the exercise of stock options in excess of the compensation expense recorded for those options (excess tax benefits) are classified as cash flows from financing activities in the consolidated statements of cash flows. | |||||||||
Estimating the fair value of equity-settled awards as of the grant date using valuation models, such as the Black-Scholes option pricing model, is affected by assumptions regarding a number of complex variables. Changes in the assumptions can materially affect the fair value and ultimately how much stock-based compensation expense is recognized. These inputs are subjective and generally require significant analysis and judgment to develop. For all stock options granted to date, we estimated the expected term and the volatility data based on a study of publicly traded industry peer companies. For purposes of identifying these peer companies, we considered the industry, stage of development, size and financial leverage of potential comparable companies. The risk-free interest rate is based on the yield available on U.S. Treasury zero-coupon issues similar in duration to the expected term of the equity-settled award. | |||||||||
Net Loss per Share | |||||||||
Basic net loss per share is calculated by dividing the net loss by the weighted average number of common shares that were outstanding for the period, without consideration for potential common shares. Because the holders of the Company’s convertible preferred stock and its restricted common shares are entitled to participate in dividends and earnings of the Company when dividends are paid on common stock, the Company applies the two-class method in calculating its earnings per share for periods when the Company generates net income. The two-class method requires net income to be allocated between the common and preferred stockholders based on their respective rights to receive dividends, whether or not declared. Because the convertible preferred stock and restricted common stock are not contractually obligated to share in the Company’s losses, no such allocation was made for any period presented given the Company’s net losses. Diluted net loss per share is calculated by dividing the net loss by the sum of the weighted-average number of dilutive potential common shares outstanding for the period determined using the treasury-stock method or the as-converted method. Potentially dilutive shares are comprised of convertible preferred stock, convertible preferred stock and common stock warrants, shares purchased with nonrecourse loans and options outstanding under our stock plan. For all periods presented, there is no difference in the number of shares used to calculate basic and diluted shares outstanding due to our net loss and potentially dilutive shares being anti-dilutive. | |||||||||
The following equity shares were excluded from the calculation of diluted net loss per share because their effect would have been anti-dilutive for the periods presented (shares for the convertible preferred stock and convertible preferred stock warrants were determined based on the applicable conversion ratio): | |||||||||
Three Months Ended March 31, | |||||||||
2014 | 2013 | ||||||||
Convertible preferred stock | 11,601,860 | 9,071,203 | |||||||
Employee stock options | 1,507,055 | 1,468,633 | |||||||
Convertible preferred stock warrants | 192,472 | 192,472 | |||||||
Common stock warrants | 426,878 | 426,878 | |||||||
Total | 13,728,265 | 11,159,186 | |||||||
Recent_Accounting_Pronouncemen
Recent Accounting Pronouncements | 3 Months Ended | |
Mar. 31, 2014 | ||
Accounting Changes And Error Corrections [Abstract] | ' | |
Recent Accounting Pronouncements | ' | |
3 | Recent Accounting Pronouncements | |
In July 2013, the FASB issued an accounting standards update that provides explicit guidance on the financial statement presentation of an unrecognized tax benefit when a net operating loss carry forward, a similar tax loss, or a tax credit carry forward exists. The guidance is effective prospectively for fiscal years, and interim periods within those years, beginning after December 15, 2013, with an option for early adoption. We adopted this guidance at the beginning of our first quarter of fiscal year 2014. The adoption did not have a material impact on our financial position, results of operations or related financial statement disclosures. |
StockBased_Compensation
Stock-Based Compensation | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Compensation Related Costs [Abstract] | ' | ||||||||
Stock-Based Compensation | ' | ||||||||
4 | Stock-Based Compensation | ||||||||
The Company classifies stock-based compensation expense in the accompanying Consolidated Statements of Comprehensive Loss based on the department to which a recipient belongs to. The following table sets forth stock-based compensation expense related to options granted to employees for the periods presented (in thousands): | |||||||||
Three Months Ended March 31, | |||||||||
2014 | 2013 | ||||||||
Cost of goods sold | $ | 21 | $ | 17 | |||||
Research and development | 62 | 56 | |||||||
Sales, general and administrative | 379 | 182 | |||||||
Total | $ | 462 | $ | 255 | |||||
Fair_Value_Measurements
Fair Value Measurements | 3 Months Ended | ||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||
Fair Value Measurements | ' | ||||||||||||||||
5 | Fair Value Measurements | ||||||||||||||||
The carrying amount of certain financial instruments, including accounts receivable, accounts payable, and accrued liabilities approximate fair value due to their relatively short maturities. | |||||||||||||||||
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. 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 that reflect unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date; | ||||||||||||||||
Level 2 | Inputs other than quoted prices that are observable for the assets or liability either directly or indirectly, including inputs in markets that are not considered to be active; | ||||||||||||||||
Level 3 | Inputs that are unobservable. | ||||||||||||||||
Assets and liabilities measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires management to make judgments and consider factors specific to the asset or liability. | |||||||||||||||||
The following table sets forth the Company’s financial instruments that were measured at fair value on a recurring basis at March 31, 2014 by level within the fair value hierarchy (in thousands): | |||||||||||||||||
Assets at Fair Value | |||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Liabilities | |||||||||||||||||
Series C convertible preferred stock warrant liability | $ | — | $ | — | $ | 75 | $ | 75 | |||||||||
Series D convertible preferred stock warrant liability | — | — | 1,275 | 1,275 | |||||||||||||
Total | $ | — | $ | — | $ | 1,350 | $ | 1,350 | |||||||||
The following table sets forth the Company’s financial instruments that were measured at fair value on a recurring basis at December 31, 2013 by level within the fair value hierarchy (in thousands): | |||||||||||||||||
Assets at Fair Value | |||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Liabilities | |||||||||||||||||
Series C convertible preferred stock warrant liability | $ | — | $ | — | $ | 72 | $ | 72 | |||||||||
Series D convertible preferred stock warrant liability | — | — | 1,208 | 1,208 | |||||||||||||
Total | $ | — | $ | — | $ | 1,280 | $ | 1,280 | |||||||||
Based upon Level 2 inputs and the borrowing rates currently available for loans with similar terms, the Company believes that the fair value of its notes payable approximates its carrying value. The fair value of the Company’s Series C and D convertible preferred stock warrant liabilities was based on Level 3 inputs. The Company valued the Series C convertible preferred stock warrant liabilities and the Series D convertible preferred stock warrant liabilities using the Black-Scholes model as well as the residual value approach. | |||||||||||||||||
The table below presents the activity of Level 3 liabilities during the periods indicated (in thousands): | |||||||||||||||||
March 31, | December 31, | ||||||||||||||||
2014 | 2013 | ||||||||||||||||
Derivative / warrant liabilities balance at the beginning of the period | $ | 1,280 | $ | 1,424 | |||||||||||||
Change in value included in interest income and other income (expense), net | 70 | (144 | ) | ||||||||||||||
Derivative / warrant liabilities balance at the end of the period | $ | 1,350 | $ | 1,280 | |||||||||||||
Balance_Sheet_Components
Balance Sheet Components | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Organization Consolidation And Presentation Of Financial Statements [Abstract] | ' | ||||||||
Balance Sheet Components | ' | ||||||||
6 | Balance Sheet Components | ||||||||
Inventories | |||||||||
Inventories consisted of the following (in thousands): | |||||||||
March 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Raw material | $ | 2,833 | $ | 2,394 | |||||
Work-in-process and sub-assemblies | 2,919 | 1,951 | |||||||
Finished goods | 1,323 | 2,697 | |||||||
Total | $ | 7,075 | $ | 7,042 | |||||
Property and equipment | |||||||||
Property and equipment consist of the following (in thousands): | |||||||||
March 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Laboratory, machinery and equipment | $ | 7,024 | $ | 7,024 | |||||
Equipment and software | 2,160 | 2,150 | |||||||
Leasehold improvements | 5,657 | 5,657 | |||||||
Furniture and fixtures | 317 | 317 | |||||||
15,158 | 15,148 | ||||||||
Less: Accumulated depreciation and amortization | (13,784 | ) | (13,643 | ) | |||||
Total | $ | 1,374 | $ | 1,505 | |||||
Depreciation and amortization expense related to property and equipment amounted to $141,000 and $378,000 for the three months ended March 31, 2014 and 2013, respectively. | |||||||||
Goodwill and other intangible assets, net | |||||||||
The goodwill on the consolidated balance sheets was $8.3 million for all periods presented. | |||||||||
The gross carrying amount of the intangible assets on the accompanying consolidated balance sheets was $1.2 million for all periods presented. Amortization expense for the three months ended March 31, 2014 and 2013 was $0 and $35,000, respectively. | |||||||||
Accrued liabilities and other | |||||||||
Accrued liabilities and other consist of the following on the accompanying consolidated balance sheets (in thousands): | |||||||||
March 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Accrued compensation and related expenses | $ | 3,727 | $ | 4,263 | |||||
Other accrued expenses | 1,714 | 1,866 | |||||||
Total | $ | 5,441 | $ | 6,129 | |||||
Distribution_Agreement
Distribution Agreement | 3 Months Ended | |
Mar. 31, 2014 | ||
Organization Consolidation And Presentation Of Financial Statements [Abstract] | ' | |
Distribution Agreement | ' | |
7 | Distribution Agreement | |
On January 1, 2014, the Company entered into a distribution agreement (the “Distribution Agreement”) with Century Medical, Inc. (“Century”) with respect to the anticipated distribution of the Company’s Ovation and Ovation Prime medical devices in Japan. Under the terms of a secured note purchase agreement, Century agreed to loan the Company an aggregate of up to $6.0 million, with principal due in January 2019, under the agreement, subject to certain conditions. Under this facility, the Company received $4.0 million on January 10, 2014 and received the remaining $2.0 million on March 18, 2014 as the Company had achieved trailing 12-month revenues of $20 million and no material adverse event had occurred. The notes bear 5% annual interest which is payable quarterly in arrears through January 9, 2019, the maturity date when the entire principal balance becomes due. In return for the loan commitment, the Company granted Century distribution rights to the Company’s planned Ovation and Ovation Prime product line in Japan, and a right of first negotiation for distribution rights in Japan to future products. Century will be responsible for securing regulatory approval from the Ministry of Health in Japan for the Ovation and Ovation Prime product line. | ||
Proceeds from the note and granting the distribution rights were allocated to the note based on its aggregate fair value of $3.0 million at the dates of receipt. This fair value was determined by discounting cash flows using a discount rate of 15%, which the Company estimated as market rate of borrowing that could be obtained by companies with credit risk similar to the Company’s. The remainder of the proceeds of $3.0 million was recognized as debt issuance discount and allocated to the value of the distribution rights granted to Century under the Distribution Agreement. It is included in deferred revenue in Other long term liabilities on the consolidated balance sheets. The deferred revenue will be recognized on a straight-line basis over the term of the Distribution Agreement, beginning upon the first sale by Century of the Ovation and Ovation Prime products in Japan. |
Commitments_and_Contingencies
Commitments and Contingencies | 3 Months Ended | |
Mar. 31, 2014 | ||
Commitments And Contingencies Disclosure [Abstract] | ' | |
Commitments and Contingencies | ' | |
8 | Commitments and Contingencies | |
Operating Leases | ||
The Company’s headquarters’ facility lease expires on February 28, 2018. The Company also has small office leases in its subsidiary locations. Total lease expense was $281,000 and $265,000 for the three months ended March 31, 2014 and 2013, respectively. The Company recognizes lease expense on a straight-line basis over the life of the lease. In addition to the lease obligation, the Company pays for common area maintenance and insurance for the facility. The Company also has various office equipment leases for copiers and postage machines. | ||
Contingencies | ||
From time to time, the Company may have certain contingent liabilities that arise in the ordinary course of business activities. The Company accrues a liability for such matters when it is probable that future expenditures will be made and such expenditures can be reasonably estimated. There were no contingent liabilities requiring accrual at March 31, 2014. | ||
Employment Agreements | ||
The Company enters into employment agreements with its executive officers. The 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 after a change in control, as defined in such agreements. | ||
Indemnification | ||
The Company enters into standard indemnification arrangements in the ordinary course of business. Pursuant to these arrangements, the Company indemnifies, holds harmless, and agrees to reimburse the indemnified parties for losses suffered or incurred by the indemnified party, in connection with any trade secret, copyright, patent or other intellectual property infringement claim by any third party with respect to the Company’s technology. The term of these indemnification agreements is generally perpetual. The maximum potential amount of future payments the Company could be required to make under these agreements is not determinable because it involves claims that may be made against the Company in the future, but have not yet been made. | ||
The Company has entered into indemnification agreements with its directors and officers that may require the Company to indemnify its directors and officers against liabilities that may arise by reason of their status or service as directors or officers, other than liabilities arising from willful misconduct of the individual. | ||
The Company has not incurred costs to defend lawsuits or settle claims related to these indemnification agreements. No liability associated with such indemnifications has been recorded to date. |
Notes_Payable
Notes Payable | 3 Months Ended | |
Mar. 31, 2014 | ||
Debt Disclosure [Abstract] | ' | |
Notes Payable | ' | |
9 | Notes Payable | |
Century Medical, Inc. Subordinated Loan | ||
In connection with the Distribution Agreement with Century (see Note 7), the Company entered into a secured note purchase agreement and a related security agreement, pursuant to which Century agreed to loan to the Company up to an aggregate of $6.0 million, which amount was received in the first quarter ended March 31, 2014. Under this facility, the Company received $4.0 million on January 10, 2014, and the remaining $2.0 million on March 18, 2014. This note bears 5% annual interest which is payable quarterly in arrears on the last business day of March, June, September and December of each year through January 9, 2019, the maturity date when the total $6.0 million of principal becomes due. The debt issuance discount of approximately $3.0 million is reflected as a reduction in long-term debt and is being amortized as interest expense over the term of the note using the effective interest method. The loan contains various affirmative and negative covenants and customary events of default, including if a material adverse change occurs with respect to the Company’s business, operations or financial condition, and is subordinated to the Company’s term loan with Capital Royalty. | ||
The Company made interest payments of $48,000 and $0 in the three months ended March 31, 2014 and 2013, respectively. | ||
Capital Royalty Term Loan | ||
On October 12, 2012, the Company executed a Term Loan Agreement with Capital Royalty Partners II L.P. and its affiliate Parallel Investment Opportunities Partners II L.P. (collectively “Capital Royalty”) for up to a $50 million term loan to be used to pay off the Company’s then existing senior notes held by a previous lender and to fund operations. The loan may be drawn in two tranches. The first tranche of $40 million was drawn prior to March 31, 2013, and an additional amount up to $10 million could be available upon achievement of a revenue-based milestone, if notice of that achievement is issued by May 31, 2014. The loan bears interest at a rate of 14.0%, based upon a year of 360 days and actual days elapsed. Prior to September 30, 2017, the Company may at its election pay the interest as follows: 11.5% per annum paid in cash and 2.5% per annum paid in-kind in the form of additional term loans, or PIK Loans. Payments under the loan are made on a quarterly basis with payment dates fixed at the end of each calendar quarter (“Payment Dates”). The notes are interest-only through the 14th Payment Date (March 31, 2016) following funding if the second tranche is not drawn. In the event the second tranche is drawn the interest-only period is extended through the 16th Payment Date (September 30, 2016) following funding. Following the interest-only period principal payments are made in equal installments at the end of the six subsequent calendar quarters if the second tranche is not drawn and the subsequent eight calendar quarters if the second tranche is drawn. The notes mature on the 20th Payment Date (September 30, 2017) if the second tranche is not drawn and the 24th Payment Date (September 30, 2018) if the second tranche is drawn. In connection with the loan, the Company paid a loan origination fee of 1% and issued warrants to purchase 167,611 shares of common stock at $0.41 per share. The initial fair value of the warrants was $496,000 and resulted in a discount to the notes payable, which is being accreted to interest income and other income (expense), net in the statements of comprehensive loss over the life of the loan. The notes had a prepayment premium of 5% of the aggregate outstanding principal, including PIK Loans, if the loan was prepaid prior to the end of the fourth Payment Date (September 30, 2013). The amount of the prepayment premium decreases by 1% during each subsequent 12-month period thereafter. | ||
The term loan is collateralized by a first priority security interest on all of the Company’s assets excluding property not assignable without consent by a third party, trademarks that would be invalid by reason of including it in the collateral and 35% of the ownership interest in a foreign subsidiary. | ||
The loan and security agreement contains customary representations and warranties, covenants, events of defaults and termination provisions. The affirmative covenants include, among other things, that the Company timely file taxes, maintain good standing and government compliance, achieve minimum annual revenue thresholds, maintain liability and other insurance, and provide security interests to Capital Royalty in the collateral of any subsidiary formed or acquired by the Company in the future. The negative covenants provide, among other things, that without the prior consent of Capital Royalty (subject to certain exceptions), the Company may not dispose of certain assets, engage in certain business combinations or acquisitions, incur additional indebtedness or encumber any of the Company’s property, pay dividends on the Company’s capital stock or make prohibited investments. The loan and security agreement provides that an event of default will occur if, among other triggers, (1) the Company defaults in the payment of any amount payable under the agreement when due, (2) there occurs any circumstance or circumstances that could reasonably be expected to result in a material adverse effect on the Company’s business, operations or condition, or on the Company’s ability to perform its obligations under the agreement, (3) the Company becomes insolvent, (4) the Company undergoes a change in control or (5) the Company breaches any negative covenants or certain affirmative covenants in the agreement or, subject to a cure period, otherwise neglects to perform or observe any material item in the agreement. The repayment of the term loan may be accelerated, at the option of Capital Royalty, following the occurrence of an event of default, which would require the Company to pay to Capital Royalty an amount equal to the sum of: (i) all outstanding principal plus accrued interest, (ii) the final payment, plus (iii) all other sums, that shall have become due and payable but have not been paid, including interest at the default rate with respect to any past due amounts plus the prepayment premium. | ||
The first measurement date for the minimum annual revenue covenant was April 30, 2014, with subsequent measurement dates at the end of subsequent twelve-month periods. | ||
As of March 31, 2014, the Company was in compliance with all of the covenants. | ||
Boston Scientific Corporation Note Payable | ||
In conjunction with the acquisition of Boston Scientific Santa Rosa, or BSSR, the Company issued a promissory note in the amount of $3,487,000 to the prior owners of BSSR as part of the purchase consideration. The note bore an interest rate of 5.25% per annum and was set to mature on March 28, 2018. The note (along with unpaid accrued interest) was repayable upon the earlier of (a) the date upon which initial public offering is consummated, or (b) the sale of the Company, including liquidation, dissolution or winding up. The Company repaid the note in full, including all accrued interest, subsequent to the closing of the IPO in April 2014. |
Stockholders_Equity
Stockholders' Equity | 3 Months Ended | ||||
Mar. 31, 2014 | |||||
Equity [Abstract] | ' | ||||
Stockholders' Equity | ' | ||||
10 | Stockholders’ Equity | ||||
In February 2014, the Company’s board of directors and stockholders approved an amendment to the amended and restated certificate of incorporation effecting a reverse stock split within a specified range with the final ratio to be determined by a committee of the board of directors. In March 2014, the committee of the board of directors approved a 1-for-40.57 reverse stock split of the Company’s issued and outstanding shares of common stock and the corresponding adjustments to the conversion ratio of the convertible preferred stock. The reverse split was implemented on April 1, 2014. The par value of the common and convertible preferred stock was not adjusted as a result of the reverse stock split. Except as otherwise indicated, all issued and outstanding share and per share amounts included in the accompanying consolidated financial statements have been adjusted to reflect this reverse stock split for all periods presented. | |||||
Convertible Preferred Stock | |||||
Prior to the reverse stock split, the Company authorized 401,334,139 shares of convertible preferred stock, of which 393,432,624 shares were issued and outstanding as of March 31, 2014 and December 31, 2013, designated in series. | |||||
Conversion | |||||
The shares of Series A, Series B, Series C, Series D and Series E preferred stock were convertible into an equal number of shares of common stock, at the option of the holder, subject to certain anti-dilution adjustments, such as in the event of a private placement at an offering price below the price of our Series E convertible preferred stock offering. The Series D convertible preferred stock was issued at a price per share lower than the issuance price per share of the Series A, Series B and Series C convertible preferred stock, triggering the anti-dilution adjustment of the conversion ratios into common stock of Series A, Series B and Series C convertible preferred stock. The issuance price triggering the anti-dilution adjustments was reset to the Series D issuance price at the time of the Series D financing and to the Series E issuance price at the time of the Series E financing. | |||||
The conversion ratios were as follows: | |||||
Series A and B convertible preferred stock | 1 to 26.00 | ||||
Series C convertible preferred stock | 1 to 25.64 | ||||
Series D convertible preferred stock | 1 to 40.57 | ||||
Series E convertible preferred stock | 1 to 40.57 | ||||
Each share of Series A, Series B, Series C, Series D and Series E convertible preferred stock were automatically converted into common stock immediately upon the completion of the Company’s initial public offering on April 22, 2014. | |||||
Warrants | |||||
All of the Company’s warrants remained outstanding as of March 31, 2014. The Company’s convertible preferred stock warrants all converted to warrants to purchase common stock at the above conversion ratios on April 22, 2014. |
Equity_Incentive_Plan
Equity Incentive Plan | 3 Months Ended | |
Mar. 31, 2014 | ||
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ' | |
Equity Incentive Plan | ' | |
11 | Equity Incentive Plan | |
In April 2008, the Company adopted the 2008 Equity Incentive Plan (the “2008 Plan”). The 2008 Plan provides for the granting of stock options to employees, directors and consultants of the Company. Options granted under the 2008 Plan may be either incentive stock options or nonqualified stock options. Incentive stock options, or ISOs, may be granted only to Company employees. Nonqualified stock options, or NSOs, may be granted to all eligible recipients. As of March 31, 2014 and December 31, 2013, there were 2,439,624 shares of common stock authorized for issuance under the 2008 Plan. | ||
Options under the 2008 Plan have terms of up to ten years. The exercise price of an ISO may not be less than 100% of the fair market value of the shares on the date of grant; the exercise price for an NSO may not be less than 100% of the fair market value of the shares on the date of grant and the exercise price of an ISO or an NSO granted to a more than 10% shareholder may not be less than 110% of the fair market value of the shares on the date of grant. Options become exercisable as determined by the board of directors. Options expire as determined by the board of directors but not more than ten years after the date of grant. In connection with the IPO, the 2008 Plan terminated in April 2014, and no further grants may be made from the 2008 Plan, while previously granted options continue in accordance with their respective terms. |
Income_Tax_Expense
Income Tax Expense | 3 Months Ended | |
Mar. 31, 2014 | ||
Income Tax Disclosure [Abstract] | ' | |
Income Tax Expense | ' | |
12 | Income Tax Expense | |
The Company applied an estimated annual effective tax rate (“ETR”) approach for calculating a tax provision for interim periods, as required under U.S. GAAP. The Company recorded a provision for income taxes of $23.0 thousand and $27.0 thousand for the three months ended March 31, 2014 and 2013, respectively, representing an ETR of (0.16%) and (0.24%), respectively. The Company’s ETR for the three months ended March 31, 2014 differs from the U.S. federal statutory tax rate of 35% primarily as a result of nondeductible expenses, state income taxes, foreign income taxes, and the impact of a full valuation allowance on its deferred tax assets. | ||
The Company has evaluated the available evidence supporting the realization of its deferred tax assets, including the amount and timing of future taxable income, and has determined that it is more likely than not that its net deferred tax assets will not be realized in the U.S. and certain foreign jurisdictions. Due to uncertainties surrounding the realization of the deferred tax assets, the Company maintains a full valuation allowance against substantially all deferred tax assets. If/when the Company determines that it will be able to realize some portion or all of its deferred tax assets, an adjustment to its valuation allowance on its deferred tax assets would have the effect of increasing net income in the period that such determination is made. |
Related_Party_Transactions
Related Party Transactions | 3 Months Ended | |
Mar. 31, 2014 | ||
Related Party Transactions [Abstract] | ' | |
Related Party Transactions | ' | |
13 | Related Party Transactions | |
In February and March 2014, the loans to executive officers were satisfied and extinguished. The April 2010 and September 2012 notes along with accrued interest were repaid in cash resulting in aggregate proceeds of $1,497,435 inclusive of accrued interest of $6,238. The January 2011 note was extinguished with the surrender of the underlying collateral shares to satisfy the loan. The difference between the carrying amount of the loan and the value of the collateral shares will be recorded as a loss on extinguishment of the note and the underlying shares were kept in treasury until retired to authorized, unissued by resolution of the board of directors in April 2014. |
Subsequent_Events
Subsequent Events | 3 Months Ended | |
Mar. 31, 2014 | ||
Subsequent Events [Abstract] | ' | |
Subsequent Events | ' | |
14 | Subsequent Events | |
Initial Public Offering | ||
In April 2014, the Company completed the IPO of its common stock, which resulted in the sale of 7,475,000 shares at a price of $12.00 per share. The Company received net proceeds from the IPO of approximately $81.2 million, after deducting underwriting discounts and commissions and offering expenses. | ||
Upon closing of the IPO, (i) all outstanding warrants to purchase shares of the Company’s convertible preferred stock converted into warrants to purchase shares of the Company’s common stock, (ii) all outstanding shares of the Company’s convertible preferred stock converted into shares of common stock and (iii) the Company applied a portion of the net proceeds from the offering to repay all the outstanding principal and accrued interest owed under our promissory note to Boston Scientific Corporation (see Note 9). In addition, a warrant to purchase up to 223,487 shares of the Company’s common stock held by an affiliate of Boston Scientific Corporation expired unexercised upon the closing of the IPO and the repayment of that promissory note. | ||
2014 Equity Incentive Plan | ||
On April 1, 2014, the Company’s board of directors approved the 2014 Equity Incentive Plan (the “2014 Plan”). The 2014 Plan became effective on the effective date of the IPO, at which time the Company ceased making awards under the 2008 Plan. Under the 2014 Plan, the Company may grant stock options, stock appreciation rights, restricted stock, restricted stock units and certain other awards to individuals who are then employees, officers, directors or consultants of the Company. A total of 2,750,000 shares of common stock were initially reserved for issuance under the 2014 Plan, subject to certain annual increases. The board of directors also approved the grant of 726,550 options to purchase common stock under the terms of the 2014 Plan, effective on the effective date of the IPO. | ||
Employee Stock Purchase Plan | ||
On April 1, 2014, the Company’s board of directors approved the 2014 Employee Stock Purchase Plan (the “2014 Purchase Plan”). The 2014 Purchase Plan became effective n the effective date of the IPO. A total of 500,000 shares were initially reserved for issuance under the 2014 Purchase Plan, subject to certain annual increases. |
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policies) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Accounting Policies [Abstract] | ' | ||||||||
Basis of Presentation | ' | ||||||||
Basis of Presentation | |||||||||
The accompanying Consolidated Financial Statements in this Quarterly Report on Form 10-Q have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) and with the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). These financial statements include the financial position, results of operations, and cash flows of the Company, including its wholly-owned subsidiaries. All inter-company accounts and transactions have been eliminated in consolidation. | |||||||||
The interim financial data as of March 31, 2014, is unaudited and is not necessarily indicative of the results for a full year or any interim period. In the opinion of the Company’s management, the interim data includes all normal and recurring adjustments necessary for a fair statement of the Company’s financial results for the three months ended March 31, 2014. The December 31, 2013 consolidated balance sheet data was derived from audited financial statements. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to SEC rules and regulations relating to interim financial statements. | |||||||||
The accompanying Consolidated Financial Statements should be read in conjunction with the Company’s audited Consolidated Financial Statements and Notes thereto included in the Company’s final prospectus filed pursuant to Rule 424(b) under the Securities and Exchange Act of 1933, as amended, relating to the Company’s Registration Statement on Form S-1 (File No. 333-194466), filed with the SEC on April 17, 2014. | |||||||||
On April 22, 2014, the Company completed its initial public offering (“IPO”) of 7,475,000 shares of common stock, which includes the exercise in full by the underwriters in the offering of their option to purchase 975,000 additional shares of common stock, at an offering price of $12.00 per share. The Company received net proceeds of approximately $81.2 million, after deducting underwriting discounts and commissions and offering expenses. In connection with the IPO, the Company’s outstanding shares of convertible preferred stock were automatically converted into 11,601,860 shares of common stock and warrants exercisable for convertible preferred stock were automatically converted into warrants exercisable for 192,472 shares of common stock, resulting in the reclassification of the related redeemable convertible preferred stock warrant liability of $1.4 million to additional paid-in capital. | |||||||||
Use of estimates | ' | ||||||||
Use of estimates | |||||||||
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates and such differences could be material. | |||||||||
Segment Information | ' | ||||||||
Segment Information | |||||||||
The Company considers operating segments to be components of the Company in which separate financial information is available that is evaluated regularly by the Company’s chief operating decision maker in deciding how to allocate resources and in assessing performance. The chief operating decision maker for the Company is the Chief Executive Officer. The Chief Executive Officer reviews financial information presented on a consolidated basis, accompanied by information about revenue by geographic region, for purposes of allocating resources and evaluating financial performance. The Company has one business activity and there are no segment managers who are held accountable for operations, operating results or plans for levels or components below the consolidated unit level. Accordingly, the Company has determined that it has a single reportable and operating segment structure. The Company and its Chief Executive Officer evaluate performance based primarily on revenue in the geographic locations in which the Company operates. | |||||||||
Revenues by geography are based on the billing address of the customer. The following table sets forth revenue by geographic area (in thousands): | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
United States (U.S.) | $ | 4,602 | $ | 941 | |||||
International | 2,432 | 2,001 | |||||||
Total | $ | 7,034 | $ | 2,942 | |||||
The following table summarizes countries with revenues accounting for more than 10% of the total: | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
Germany | < 10 | % | 18 | % | |||||
Greece | < 10 | % | 10 | % | |||||
Italy | < 10 | % | 18 | % | |||||
U.S. | 65 | % | 32 | % | |||||
Long-lived assets and operating income outside the U.S. are not material; therefore disclosures have been limited to revenue. | |||||||||
Cash and Cash Equivalents | ' | ||||||||
Cash and Cash Equivalents | |||||||||
Cash and cash equivalents consist of demand deposit accounts and institutional money market funds held in U.S. and foreign banks. Cash equivalents consist of highly liquid investment securities with original maturities at the date of purchase of three months or less. | |||||||||
Accounts Receivable | ' | ||||||||
Accounts Receivable | |||||||||
Trade accounts receivable are recorded at the invoice amount and do not include interest. The Company regularly reviews accounts for collectability and establishes an allowance for probable credit losses and writes off uncollectible accounts as necessary. The Company has determined that no reserve was required at either of the periods presented. | |||||||||
Inventories | ' | ||||||||
Inventories | |||||||||
The Company values inventory at the lower of cost to purchase or manufacture the inventory or the market value for such inventory. Cost is determined using the standard cost method which approximates the first-in first-out method. The Company regularly reviews inventory quantities in consideration of actual loss experiences, projected future demand, and remaining shelf life to record a provision for excess and obsolete inventory when appropriate. | |||||||||
Property and Equipment | ' | ||||||||
Property and Equipment | |||||||||
Property and equipment are stated at cost, net of accumulated depreciation and amortization. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. | |||||||||
The depreciation and amortization periods for the Company’s property and equipment are as follows: | |||||||||
Equipment and software | 3 years | ||||||||
Laboratory machinery and equipment | 3–5 years | ||||||||
Furniture and fixtures | 5 years | ||||||||
Leasehold improvements are amortized over the lesser of their useful lives or the remaining life of the lease. When assets are retired or otherwise disposed of, the cost and related accumulated depreciation and amortization are removed from the consolidated balance sheet and the resulting gain or loss is reflected in operations in the period realized. Cost of maintenance and repairs are charged to expense as incurred, and improvements and betterments are capitalized. | |||||||||
Goodwill and Indefinite Lived Intangible Assets | ' | ||||||||
Goodwill and Indefinite Lived Intangible Assets | |||||||||
The Company has recorded goodwill and intangible assets on the consolidated balance sheets. The Company classifies intangible assets into three categories: (1) goodwill; (2) intangible assets with indefinite lives not subject to amortization; and (3) intangible assets with definite lives subject to amortization. | |||||||||
Goodwill and intangible assets with indefinite lives are not amortized. The Company assesses goodwill and intangible assets with indefinite lives for impairment on an annual basis in the fourth quarter of each year or more frequently if indicators of impairment exist. For the purpose of testing goodwill for impairment, the Company has determined that it has one reporting unit. | |||||||||
Deferred Offering Costs | ' | ||||||||
Deferred Offering Costs | |||||||||
Deferred offering costs, consisting of legal, accounting and other fees and costs relating to the IPO, are capitalized. The deferred offering costs were offset against the IPO proceeds upon the closing of the offering in April 2014. There were $1.2 and $0.7 million of deferred offering costs capitalized as of March 31, 2014 and December 31, 2013, respectively, in other assets on the consolidated balance sheets. | |||||||||
Convertible Preferred Stock Warrant Liability | ' | ||||||||
Convertible Preferred Stock Warrant Liability | |||||||||
Freestanding warrants related to convertible preferred stock shares that are contingently redeemable are classified as a liability on the Company’s accompanying consolidated balance sheet. The convertible preferred stock warrants are subject to re-measurement at each balance sheet date, and any change in fair value is recognized as a component of interest income and other income (expense), net. The Company continued to adjust the liability for changes in fair value until the completion of the IPO in April 2014, at which time all redeemable convertible preferred stock warrants were converted into warrants to purchase common stock and the liability was reclassified to additional paid-in capital. | |||||||||
Revenue | ' | ||||||||
Revenue | |||||||||
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 probable at the time of sale; and | ||||||||
• | delivery has occurred or services have been rendered. | ||||||||
For sales directly to hospitals or medical facilities, the Company recognizes revenue upon completion of a procedure, which is when the product is implanted in a patient, and a valid purchase order has been received. For distributor sales, the Company recognizes revenue at the time of shipment of product, as this represents the point that the customer has taken ownership and assumed risk of loss. The Company does not offer rights of return or price protection and has no post-delivery obligations. The Company offers rights of exchange in limited circumstances for products with a short shelf life at the time of shipment, and has established a $34,000 and $0 reserve for such exchanges included in accrued liabilities and other in the consolidated balance sheets at March 31, 2014 and December 31, 2013, respectively. | |||||||||
Income Taxes | ' | ||||||||
Income Taxes | |||||||||
The Company records income taxes using the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been recognized in the Company’s consolidated financial statements or income tax returns. In estimating future tax consequences, expected future events other than enactments or changes in the tax law or rates are considered. Valuation allowances are provided when necessary to reduce deferred tax assets to the amount expected to be realized. | |||||||||
The Company operates in various tax jurisdictions and is subject to audit by various tax authorities. The Company provides for tax contingencies whenever it is deemed probable that a tax asset has been impaired or a tax liability has been incurred for events such as tax claims or changes in tax laws. Tax contingencies are based upon their technical merits, relative tax law, and the specific facts and circumstances as of each reporting period. Changes in facts and circumstances could result in material changes to the amounts recorded for such tax contingencies. | |||||||||
The Company records uncertain tax positions on the basis of a two-step process whereby (1) a determination is made as to whether it is more likely than not that the tax positions will be sustained based on the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold the Company recognizes the largest amount of tax benefit that is greater than 50% likely to be realized upon ultimate settlement with the related tax authority. | |||||||||
Other Comprehensive Loss | ' | ||||||||
Other Comprehensive Loss | |||||||||
Other comprehensive loss represents all changes in stockholders’ deficit except those resulting from investments or contributions by stockholders. The Company’s other comprehensive loss consists of its net loss and changes in accumulated other comprehensive loss, which represents foreign currency translation adjustments. | |||||||||
Currency Translation | ' | ||||||||
Currency Translation | |||||||||
The Euro is the functional currency of the Company’s wholly-owned subsidiaries in Italy and Germany and the Swiss Franc is the functional currency of the Company’s wholly-owned subsidiary in Switzerland. Accordingly, the assets and liabilities of these subsidiaries are translated into United States dollars using the current exchange rate in effect at the balance sheet date and equity accounts are translated into United States dollars using historical rates. Revenues and expenses are translated using the average exchanges rates in effect when the transactions occur. Foreign currency translation adjustments are recorded within accumulated other comprehensive loss, a separate component of stockholders’ deficit, on the consolidated balance sheets. Foreign exchange transaction gains and losses have not been material to the Company’s consolidated financial statements for all periods presented. | |||||||||
Stock-Based Compensation | ' | ||||||||
Stock-Based Compensation | |||||||||
The Company’s determination of the fair value of stock options on the date of grant utilizes the Black-Scholes option-pricing model, and is impacted by its common stock price as well as changes in assumptions regarding a number of highly complex and subjective variables. These variables include, but are not limited to, expected common stock price volatility over the term of the option awards, as well as the projected employee option exercise behaviors (expected period between stock option vesting date and stock option exercise date), risk-free interest rates and expected dividends. | |||||||||
The fair value is recognized over the period during which an optionee is required to provide services in exchange for the option award, known as the requisite service period (usually the vesting period) on a straight-line basis. Stock-based compensation expense recognized at fair value includes the impact of estimated forfeitures. The Company estimates future forfeitures at the date of grant and revises the estimates, if necessary, in subsequent periods if actual forfeitures differ from those estimates. | |||||||||
Equity instruments issued to non-employees are recorded at their fair value on the measurement date and are subject to periodic adjustments as the underlying equity instruments vest. The fair value of options granted to consultants is expensed when vested. The non-employee stock-based compensation expense was not material for all periods presented. | |||||||||
Cash flows resulting from the tax benefits for tax deductions resulting from the exercise of stock options in excess of the compensation expense recorded for those options (excess tax benefits) are classified as cash flows from financing activities in the consolidated statements of cash flows. | |||||||||
Estimating the fair value of equity-settled awards as of the grant date using valuation models, such as the Black-Scholes option pricing model, is affected by assumptions regarding a number of complex variables. Changes in the assumptions can materially affect the fair value and ultimately how much stock-based compensation expense is recognized. These inputs are subjective and generally require significant analysis and judgment to develop. For all stock options granted to date, we estimated the expected term and the volatility data based on a study of publicly traded industry peer companies. For purposes of identifying these peer companies, we considered the industry, stage of development, size and financial leverage of potential comparable companies. The risk-free interest rate is based on the yield available on U.S. Treasury zero-coupon issues similar in duration to the expected term of the equity-settled award. | |||||||||
Net Loss per Share | ' | ||||||||
Net Loss per Share | |||||||||
Basic net loss per share is calculated by dividing the net loss by the weighted average number of common shares that were outstanding for the period, without consideration for potential common shares. Because the holders of the Company’s convertible preferred stock and its restricted common shares are entitled to participate in dividends and earnings of the Company when dividends are paid on common stock, the Company applies the two-class method in calculating its earnings per share for periods when the Company generates net income. The two-class method requires net income to be allocated between the common and preferred stockholders based on their respective rights to receive dividends, whether or not declared. Because the convertible preferred stock and restricted common stock are not contractually obligated to share in the Company’s losses, no such allocation was made for any period presented given the Company’s net losses. Diluted net loss per share is calculated by dividing the net loss by the sum of the weighted-average number of dilutive potential common shares outstanding for the period determined using the treasury-stock method or the as-converted method. Potentially dilutive shares are comprised of convertible preferred stock, convertible preferred stock and common stock warrants, shares purchased with nonrecourse loans and options outstanding under our stock plan. For all periods presented, there is no difference in the number of shares used to calculate basic and diluted shares outstanding due to our net loss and potentially dilutive shares being anti-dilutive. | |||||||||
The following equity shares were excluded from the calculation of diluted net loss per share because their effect would have been anti-dilutive for the periods presented (shares for the convertible preferred stock and convertible preferred stock warrants were determined based on the applicable conversion ratio): | |||||||||
Three Months Ended March 31, | |||||||||
2014 | 2013 | ||||||||
Convertible preferred stock | 11,601,860 | 9,071,203 | |||||||
Employee stock options | 1,507,055 | 1,468,633 | |||||||
Convertible preferred stock warrants | 192,472 | 192,472 | |||||||
Common stock warrants | 426,878 | 426,878 | |||||||
Total | 13,728,265 | 11,159,186 | |||||||
Summary_of_Significant_Account2
Summary of Significant Accounting Policies (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Accounting Policies [Abstract] | ' | ||||||||
Revenue from External Customers by Geographic Areas | ' | ||||||||
Revenues by geography are based on the billing address of the customer. The following table sets forth revenue by geographic area (in thousands): | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
United States (U.S.) | $ | 4,602 | $ | 941 | |||||
International | 2,432 | 2,001 | |||||||
Total | $ | 7,034 | $ | 2,942 | |||||
Summary of Countries Revenues Accounting for More than Ten Percent of Total | ' | ||||||||
The following table summarizes countries with revenues accounting for more than 10% of the total: | |||||||||
Three Months Ended | |||||||||
March 31, | |||||||||
2014 | 2013 | ||||||||
Germany | < 10 | % | 18 | % | |||||
Greece | < 10 | % | 10 | % | |||||
Italy | < 10 | % | 18 | % | |||||
U.S. | 65 | % | 32 | % | |||||
Summary of Estimated Useful Life of Property and Equipment | ' | ||||||||
The depreciation and amortization periods for the Company’s property and equipment are as follows: | |||||||||
Equipment and software | 3 years | ||||||||
Laboratory machinery and equipment | 3–5 years | ||||||||
Furniture and fixtures | 5 years | ||||||||
Summary of Shares Excluded from Calculation of Diluted Net Loss per Share | ' | ||||||||
The following equity shares were excluded from the calculation of diluted net loss per share because their effect would have been anti-dilutive for the periods presented (shares for the convertible preferred stock and convertible preferred stock warrants were determined based on the applicable conversion ratio): | |||||||||
Three Months Ended March 31, | |||||||||
2014 | 2013 | ||||||||
Convertible preferred stock | 11,601,860 | 9,071,203 | |||||||
Employee stock options | 1,507,055 | 1,468,633 | |||||||
Convertible preferred stock warrants | 192,472 | 192,472 | |||||||
Common stock warrants | 426,878 | 426,878 | |||||||
Total | 13,728,265 | 11,159,186 | |||||||
StockBased_Compensation_Tables
Stock-Based Compensation (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Compensation Related Costs [Abstract] | ' | ||||||||
Schedule of Stock-Based Compensation Expense Related to Options Granted | ' | ||||||||
The following table sets forth stock-based compensation expense related to options granted to employees for the periods presented (in thousands): | |||||||||
Three Months Ended March 31, | |||||||||
2014 | 2013 | ||||||||
Cost of goods sold | $ | 21 | $ | 17 | |||||
Research and development | 62 | 56 | |||||||
Sales, general and administrative | 379 | 182 | |||||||
Total | $ | 462 | $ | 255 | |||||
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 3 Months Ended | ||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||
Schedule of Financial Instruments Measured at Fair Value on Recurring Basis | ' | ||||||||||||||||
The following table sets forth the Company’s financial instruments that were measured at fair value on a recurring basis at March 31, 2014 by level within the fair value hierarchy (in thousands): | |||||||||||||||||
Assets at Fair Value | |||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Liabilities | |||||||||||||||||
Series C convertible preferred stock warrant liability | $ | — | $ | — | $ | 75 | $ | 75 | |||||||||
Series D convertible preferred stock warrant liability | — | — | 1,275 | 1,275 | |||||||||||||
Total | $ | — | $ | — | $ | 1,350 | $ | 1,350 | |||||||||
The following table sets forth the Company’s financial instruments that were measured at fair value on a recurring basis at December 31, 2013 by level within the fair value hierarchy (in thousands): | |||||||||||||||||
Assets at Fair Value | |||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
Liabilities | |||||||||||||||||
Series C convertible preferred stock warrant liability | $ | — | $ | — | $ | 72 | $ | 72 | |||||||||
Series D convertible preferred stock warrant liability | — | — | 1,208 | 1,208 | |||||||||||||
Total | $ | — | $ | — | $ | 1,280 | $ | 1,280 | |||||||||
Schedule of Activity of Level 3 Liabilities | ' | ||||||||||||||||
The table below presents the activity of Level 3 liabilities during the periods indicated (in thousands): | |||||||||||||||||
March 31, | December 31, | ||||||||||||||||
2014 | 2013 | ||||||||||||||||
Derivative / warrant liabilities balance at the beginning of the period | $ | 1,280 | $ | 1,424 | |||||||||||||
Change in value included in interest income and other income (expense), net | 70 | (144 | ) | ||||||||||||||
Derivative / warrant liabilities balance at the end of the period | $ | 1,350 | $ | 1,280 | |||||||||||||
Balance_Sheet_Components_Table
Balance Sheet Components (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Organization Consolidation And Presentation Of Financial Statements [Abstract] | ' | ||||||||
Components of Inventories | ' | ||||||||
Inventories consisted of the following (in thousands): | |||||||||
March 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Raw material | $ | 2,833 | $ | 2,394 | |||||
Work-in-process and sub-assemblies | 2,919 | 1,951 | |||||||
Finished goods | 1,323 | 2,697 | |||||||
Total | $ | 7,075 | $ | 7,042 | |||||
Components of Property and Equipment | ' | ||||||||
Property and equipment consist of the following (in thousands): | |||||||||
March 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Laboratory, machinery and equipment | $ | 7,024 | $ | 7,024 | |||||
Equipment and software | 2,160 | 2,150 | |||||||
Leasehold improvements | 5,657 | 5,657 | |||||||
Furniture and fixtures | 317 | 317 | |||||||
15,158 | 15,148 | ||||||||
Less: Accumulated depreciation and amortization | (13,784 | ) | (13,643 | ) | |||||
Total | $ | 1,374 | $ | 1,505 | |||||
Components of Accrued Liabilities and Other | ' | ||||||||
Accrued liabilities and other consist of the following on the accompanying consolidated balance sheets (in thousands): | |||||||||
March 31, | December 31, | ||||||||
2014 | 2013 | ||||||||
Accrued compensation and related expenses | $ | 3,727 | $ | 4,263 | |||||
Other accrued expenses | 1,714 | 1,866 | |||||||
Total | $ | 5,441 | $ | 6,129 | |||||
Stockholders_Equity_Tables
Stockholders' Equity (Tables) | 3 Months Ended | ||||
Mar. 31, 2014 | |||||
Equity [Abstract] | ' | ||||
Summary of Conversion Ratios | ' | ||||
The conversion ratios were as follows: | |||||
Series A and B convertible preferred stock | 1 to 26.00 | ||||
Series C convertible preferred stock | 1 to 25.64 | ||||
Series D convertible preferred stock | 1 to 40.57 | ||||
Series E convertible preferred stock | 1 to 40.57 |
The_Company_Additional_Informa
The Company - Additional Information (Detail) | 3 Months Ended |
Mar. 31, 2014 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | ' |
Date of entity incorporation | 31-Jul-07 |
Date of entity operations | 28-Mar-08 |
Summary_of_Significant_Account3
Summary of Significant Accounting Policies - Additional Information (Detail) (USD $) | 3 Months Ended | 0 Months Ended | ||||
Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Apr. 22, 2014 | ||
Segment | Initial Public Offering [Member] | |||||
Subsequent Event [Member] | ||||||
Schedule Of Significant Accounting Policies [Line Items] | ' | ' | ' | ' | ' | |
Common stock, shares issued in initial public offering | 823,553 | ' | 580,458 | [1] | ' | 7,475,000 |
Common stock, shares exercised by underwriters | ' | ' | ' | ' | 975,000 | |
Common stock, shares offering price | ' | ' | ' | ' | $12 | |
Proceeds from initial public offering | $1,456,000 | $13,000 | ' | ' | $81,200,000 | |
Conversion of convertible preferred stock into common stock, shares | ' | ' | ' | ' | 11,601,860 | |
Conversion of convertible preferred stock into warrants exercisable common stock, shares | ' | ' | ' | ' | 192,472 | |
Reclassification of redeemable convertible preferred stock warrant liability | 1,350,000 | ' | 1,280,000 | 1,424,000 | ' | |
Number of reportable segment | 1 | ' | ' | ' | ' | |
Number of operating segment | 1 | ' | ' | ' | ' | |
Cash and cash equivalents with original maturities | 'Cash equivalents consist of highly liquid investment securities with original maturities at the date of purchase of three months or less. | ' | ' | ' | ' | |
Allowance for accounts receivable | 0 | ' | 0 | ' | ' | |
Deferred offering costs | 1,200,000 | ' | 700,000 | ' | ' | |
Reserve for exchange of product included in accrued liabilities and other | $34,000 | ' | $0 | ' | ' | |
Uncertain tax positions, description | 'The Company records uncertain tax positions on the basis of a two-step process whereby (1) a determination is made as to whether it is more likely than not that the tax positions will be sustained based on the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold the Company recognizes the largest amount of tax benefit that is greater than 50% likely to be realized upon ultimate settlement with the related tax authority. | ' | ' | ' | ' | |
[1] | The year-end consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United Stated of America. |
Summary_of_Significant_Account4
Summary of Significant Accounting Policies - Revenue from External Customers by Geographic Areas (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' |
Revenues | $7,034 | $2,942 |
United States [Member] | ' | ' |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' |
Revenues | 4,602 | 941 |
International [Member] | ' | ' |
Revenues from External Customers and Long-Lived Assets [Line Items] | ' | ' |
Revenues | $2,432 | $2,001 |
Summary_of_Significant_Account5
Summary of Significant Accounting Policies - Summary of Countries Revenues Accounting for More than Ten Percent of Total (Detail) (Revenue [Member], Geographic Concentration Risk [Member]) | 3 Months Ended | |||||||
Mar. 31, 2013 | Mar. 31, 2013 | Mar. 31, 2013 | Mar. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | |
Germany [Member] | Greece [Member] | Italy [Member] | United States [Member] | Maximum [Member] | Maximum [Member] | Maximum [Member] | Maximum [Member] | |
Germany [Member] | Greece [Member] | Italy [Member] | United States [Member] | |||||
Concentration Risk [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of sales revenue | 18.00% | 10.00% | 18.00% | 32.00% | 10.00% | 10.00% | 10.00% | 65.00% |
Summary_of_Significant_Account6
Summary of Significant Accounting Policies - Summary of Estimated Useful Life of Property and Equipment (Detail) | 3 Months Ended |
Mar. 31, 2014 | |
Equipment and software [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Estimated useful life of property and equipment | '3 years |
Furniture and fixtures [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Estimated useful life of property and equipment | '5 years |
Minimum [Member] | Laboratory machinery and equipment [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Estimated useful life of property and equipment | '3 years |
Maximum [Member] | Laboratory machinery and equipment [Member] | ' |
Property, Plant and Equipment [Line Items] | ' |
Estimated useful life of property and equipment | '5 years |
Summary_of_Significant_Account7
Summary of Significant Accounting Policies - Summary of Shares Excluded from Calculation of Diluted Net Loss per Share (Detail) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' |
Shares excluded from calculation of diluted net loss per share | 13,728,265 | 11,159,186 |
Convertible preferred stock [Member] | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' |
Shares excluded from calculation of diluted net loss per share | 11,601,860 | 9,071,203 |
Employee stock options [Member] | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' |
Shares excluded from calculation of diluted net loss per share | 1,507,055 | 1,468,633 |
Convertible preferred stock warrants [Member] | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' |
Shares excluded from calculation of diluted net loss per share | 192,472 | 192,472 |
Common stock warrants [Member] | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' |
Shares excluded from calculation of diluted net loss per share | 426,878 | 426,878 |
StockBased_Compensation_Schedu
Stock-Based Compensation - Schedule of Stock-Based Compensation Expense Related to Options Granted (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' |
Stock based compensation expense | $462 | $255 |
Cost of goods sold [Member] | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' |
Stock based compensation expense | 21 | 17 |
Research and development [Member] | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' |
Stock based compensation expense | 62 | 56 |
Sales, general and administrative [Member] | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' |
Stock based compensation expense | $379 | $182 |
Fair_Value_Measurements_Schedu
Fair Value Measurements - Schedule of Financial Instruments Measured at Fair Value on Recurring Basis (Detail) (Fair value measurements, recurring basis [Member], USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Liabilities at Fair Value | $1,350 | $1,280 |
Assets at Fair Value, Level 1 [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Liabilities at Fair Value | ' | ' |
Assets at Fair Value, Level 2 [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Liabilities at Fair Value | ' | ' |
Assets at Fair Value, Level 3 [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Liabilities at Fair Value | 1,350 | 1,280 |
Series C convertible preferred stock warrant [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Liabilities at Fair Value | 75 | 72 |
Series C convertible preferred stock warrant [Member] | Assets at Fair Value, Level 1 [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Liabilities at Fair Value | ' | ' |
Series C convertible preferred stock warrant [Member] | Assets at Fair Value, Level 2 [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Liabilities at Fair Value | ' | ' |
Series C convertible preferred stock warrant [Member] | Assets at Fair Value, Level 3 [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Liabilities at Fair Value | 75 | 72 |
Series D convertible preferred stock warrant [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Liabilities at Fair Value | 1,275 | 1,208 |
Series D convertible preferred stock warrant [Member] | Assets at Fair Value, Level 1 [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Liabilities at Fair Value | ' | ' |
Series D convertible preferred stock warrant [Member] | Assets at Fair Value, Level 2 [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Liabilities at Fair Value | ' | ' |
Series D convertible preferred stock warrant [Member] | Assets at Fair Value, Level 3 [Member] | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Liabilities at Fair Value | $1,275 | $1,208 |
Fair_Value_Measurements_Schedu1
Fair Value Measurements - Schedule of Activity of Level 3 Liabilities (Detail) (USD $) | 3 Months Ended | 12 Months Ended |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Dec. 31, 2013 |
Fair Value Disclosures [Abstract] | ' | ' |
Derivative / warrant liabilities balance at the beginning of the period | $1,280 | $1,424 |
Change in value included in interest income and other income (expense), net | 70 | -144 |
Derivative / warrant liabilities balance at the end of the period | $1,350 | $1,280 |
Balance_Sheet_Components_Compo
Balance Sheet Components - Components of Inventories (Detail) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | |
In Thousands, unless otherwise specified | |||
Inventory Disclosure [Abstract] | ' | ' | |
Raw material | $2,833 | $2,394 | |
Work-in-process and sub-assemblies | 2,919 | 1,951 | |
Finished goods | 1,323 | 2,697 | |
Total | $7,075 | $7,042 | [1] |
[1] | The year-end consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United Stated of America. |
Balance_Sheet_Components_Compo1
Balance Sheet Components - Components of Property and Equipment (Detail) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | |
In Thousands, unless otherwise specified | |||
Property, Plant and Equipment [Line Items] | ' | ' | |
Property and equipment, gross | $15,158 | $15,148 | |
Less: Accumulated depreciation and amortization | -13,784 | -13,643 | |
Property and equipment, net | 1,374 | 1,505 | [1] |
Laboratory machinery and equipment [Member] | ' | ' | |
Property, Plant and Equipment [Line Items] | ' | ' | |
Property and equipment, gross | 7,024 | 7,024 | |
Equipment and software [Member] | ' | ' | |
Property, Plant and Equipment [Line Items] | ' | ' | |
Property and equipment, gross | 2,160 | 2,150 | |
Leasehold improvements [Member] | ' | ' | |
Property, Plant and Equipment [Line Items] | ' | ' | |
Property and equipment, gross | 5,657 | 5,657 | |
Furniture and fixtures [Member] | ' | ' | |
Property, Plant and Equipment [Line Items] | ' | ' | |
Property and equipment, gross | $317 | $317 | |
[1] | The year-end consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United Stated of America. |
Balance_Sheet_Components_Addit
Balance Sheet Components - Additional Information (Detail) (USD $) | 3 Months Ended | |||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | ' | ' | ' | |
Depreciation and amortization expense related to property and equipment | $141 | $378 | ' | |
Goodwill | 8,259 | ' | 8,259 | [1] |
Gross carrying amount of intangible assets | 1,182 | ' | 1,182 | [1] |
Amortization expense | $0 | $35 | ' | |
[1] | The year-end consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United Stated of America. |
Balance_Sheet_Components_Compo2
Balance Sheet Components - Components of Accrued Liabilities and Other (Detail) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | |
In Thousands, unless otherwise specified | |||
Payables And Accruals [Abstract] | ' | ' | |
Accrued compensation and related expenses | $3,727 | $4,263 | |
Other accrued expenses | 1,714 | 1,866 | |
Total | $5,441 | $6,129 | [1] |
[1] | The year-end consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United Stated of America. |
Distribution_Agreement_Additio
Distribution Agreement - Additional Information (Detail) (USD $) | 0 Months Ended | 3 Months Ended | |
Mar. 18, 2014 | Jan. 10, 2014 | Mar. 31, 2014 | |
Debt Instrument [Line Items] | ' | ' | ' |
Amount received under notes payable | ' | ' | $6,000,000 |
Century Medical, Inc. [Member] | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' |
Distribution agreement date | ' | ' | 1-Jan-14 |
Amount received under notes payable | 2,000,000 | 4,000,000 | ' |
Amount of trailing 12-month revenues | ' | ' | 20,000,000 |
Aggregate fair value of notes | ' | ' | 3,000,000 |
Century Medical, Inc. [Member] | Notes Payable [Member] | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' |
Aggregate principal loan | ' | ' | 6,000,000 |
Notes annual interest rate | ' | ' | 5.00% |
Maturity date of debt | ' | ' | 9-Jan-19 |
Notes annual interest payable frequency | ' | ' | 'Quarterly |
Fair value cash flows discount rate | ' | ' | 15.00% |
Discount of debt issuance | ' | ' | $3,000,000 |
Commitments_and_Contingencies_
Commitments and Contingencies - Additional Information (Detail) (USD $) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Commitments And Contingencies Disclosure [Abstract] | ' | ' |
Lease expiration date | 28-Feb-18 | ' |
Total lease expenses | $281,000 | $265,000 |
Accrued contingent liabilities | 0 | ' |
Indemnification liability | $0 | ' |
Notes_Payable_Additional_Infor
Notes Payable - Additional Information (Detail) (USD $) | 3 Months Ended | 0 Months Ended | 3 Months Ended | 0 Months Ended | 3 Months Ended | |||||
Mar. 31, 2014 | Oct. 12, 2012 | Mar. 31, 2014 | Mar. 31, 2014 | Oct. 12, 2012 | Oct. 12, 2012 | Mar. 18, 2014 | Jan. 10, 2014 | Mar. 31, 2014 | Mar. 31, 2013 | |
Capital Royalty Term Loan [Member] | Capital Royalty Term Loan [Member] | Boston Scientific Santa Rosa Corporation [Member] | Tranche One [Member] | Tranche Two [Member] | Century Medical, Inc. [Member] | Century Medical, Inc. [Member] | Century Medical, Inc. [Member] | Century Medical, Inc. [Member] | ||
Tranches | Promissory Note [Member] | Capital Royalty Term Loan [Member] | Capital Royalty Term Loan [Member] | Notes Payable [Member] | Notes Payable [Member] | |||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Aggregate principal loan | ' | ' | ' | $3,487,000 | ' | ' | ' | ' | $6,000,000 | ' |
Amount received under notes payable | 6,000,000 | ' | ' | ' | ' | ' | 2,000,000 | 4,000,000 | ' | ' |
Debt instrument interest percentage | ' | ' | 14.00% | 5.25% | ' | ' | ' | ' | 5.00% | ' |
Debt instrument maturity date | ' | ' | ' | 18-Mar-18 | ' | ' | ' | ' | 9-Jan-19 | ' |
Debt issuance discount | ' | ' | ' | ' | ' | ' | ' | ' | 3,000,000 | ' |
Interest payments on debt | ' | ' | ' | ' | ' | ' | ' | ' | 48,000 | 0 |
Maximum borrowing capacity | ' | 50,000,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Number of tranches for borrowing | ' | 2 | ' | ' | ' | ' | ' | ' | ' | ' |
Loan financing amount borrowed | ' | ' | ' | ' | 40,000,000 | 10,000,000 | ' | ' | ' | ' |
Term loan agreement date | ' | ' | 12-Oct-12 | ' | ' | ' | ' | ' | ' | ' |
Credit facility expiration date | ' | ' | 30-Sep-17 | ' | ' | ' | ' | ' | ' | ' |
Interest rate description | ' | ' | '11.5% per annum paid in cash and 2.5% per annum paid in-kind in the form of additional term loans, or PIK Loans. | ' | ' | ' | ' | ' | ' | ' |
Loan payment frequency | ' | ' | 'Quarterly basis | ' | ' | ' | ' | ' | ' | ' |
Loan origination fee | ' | ' | 1.00% | ' | ' | ' | ' | ' | ' | ' |
Warrants issued to purchase common stock | ' | ' | 167,611 | ' | ' | ' | ' | ' | ' | ' |
Price of common stock per share | ' | ' | 0.41 | ' | ' | ' | ' | ' | ' | ' |
Fair value of warrants issued | ' | ' | $496,000 | ' | ' | ' | ' | ' | ' | ' |
Ownership interest in foreign subsidiary | ' | ' | 35.00% | ' | ' | ' | ' | ' | ' | ' |
Prepayment premium on aggregate outstanding principal, percentage | ' | ' | 5.00% | ' | ' | ' | ' | ' | ' | ' |
Decrease in prepayment premium percentage | ' | ' | 1.00% | ' | ' | ' | ' | ' | ' | ' |
Covenant description | ' | ' | 'The first measurement date for the minimum annual revenue covenant was AprilB 30, 2014, with subsequent measurement dates at the end of subsequent twelve-month periods. | ' | ' | ' | ' | ' | ' | ' |
Covenant compliance | ' | ' | 'The Company was in compliance with all of the covenants. | ' | ' | ' | ' | ' | ' | ' |
Stockholders_Equity_Additional
Stockholders' Equity - Additional Information (Detail) | 1 Months Ended | ||
Mar. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | |
Convertible preferred stock [Member] | Convertible preferred stock [Member] | ||
Class of Stock [Line Items] | ' | ' | ' |
Reverse stock split ratio | 40.57 | ' | ' |
Convertible preferred stock, shares authorized | ' | 401,334,139 | 401,334,139 |
Convertible preferred stock, shares issued | ' | 393,432,624 | 393,432,624 |
Convertible preferred stock, shares outstanding | ' | 393,432,624 | 393,432,624 |
Stockholders_Equity_Summary_of
Stockholders' Equity - Summary of Conversion Ratios (Detail) | Mar. 31, 2014 |
Series A and B convertible preferred stock [Member] | ' |
Conversion of Stock [Line Items] | ' |
Convertible preferred stock, shares of common stock issued upon conversion | 26 |
Series C convertible preferred stock [Member] | ' |
Conversion of Stock [Line Items] | ' |
Convertible preferred stock, shares of common stock issued upon conversion | 25.64 |
Series D convertible preferred stock [Member] | ' |
Conversion of Stock [Line Items] | ' |
Convertible preferred stock, shares of common stock issued upon conversion | 40.57 |
Series E convertible preferred stock [Member] | ' |
Conversion of Stock [Line Items] | ' |
Convertible preferred stock, shares of common stock issued upon conversion | 40.57 |
Equity_Incentive_Plan_Addition
Equity Incentive Plan - Additional Information (Detail) | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2014 |
Shareholders with more than 10% holding [Member] | Maximum [Member] | ISO [Member] | NSO [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' | ' | ' |
Common stock authorized | 2,439,624 | 2,439,624 | ' | ' | ' | ' |
Options granted expiration period | ' | ' | ' | '10 years | ' | ' |
Exercise price of stock option | ' | ' | 110.00% | ' | 100.00% | 100.00% |
Income_Tax_Expense_Additional_
Income Tax Expense - Additional Information (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Income Tax Disclosure [Abstract] | ' | ' |
Provision for income tax | $23 | $27 |
Effective tax rate | 0.16% | 0.24% |
Effective tax rate, nondeductible | 35.00% | 35.00% |
Related_Party_Transactions_Add
Related Party Transactions - Additional Information (Detail) (USD $) | 3 Months Ended |
Mar. 31, 2014 | |
Related Party Transactions [Abstract] | ' |
Aggregate proceeds from related party | $1,497,435 |
Accrued interest | $6,238 |
Subsequent_Events_Additional_I
Subsequent Events - Additional Information (Detail) (USD $) | Mar. 31, 2014 | Apr. 30, 2014 | Apr. 02, 2014 | Apr. 02, 2014 |
In Millions, except Share data, unless otherwise specified | Boston Scientific Santa Rosa Corporation [Member] | Subsequent Event [Member] | Subsequent Event [Member] | Subsequent Event [Member] |
2014 Equity Incentive Plan [Member] | Employee Stock Purchase Plan [Member] | |||
Subsequent Event [Line Items] | ' | ' | ' | ' |
Initial public offering, number of shares sold | ' | 7,475,000 | ' | ' |
Initial public offering, price per share | ' | $12 | ' | ' |
Initial public offering, net proceeds | ' | $81.20 | ' | ' |
Warrants to purchase shares of common stock | 223,487 | ' | ' | ' |
Common stock initially reserved for future issuance | ' | ' | 2,750,000 | 500,000 |
Options granted to purchase common stock | ' | ' | 726,550 | ' |