Document and Entity Information
Document and Entity Information | 9 Months Ended |
Sep. 30, 2017 | |
Document And Entity Information [Abstract] | |
Document Type | S-1/A |
Amendment Flag | false |
Document Period End Date | Sep. 30, 2017 |
Trading Symbol | TNDM |
Entity Registrant Name | TANDEM DIABETES CARE INC |
Entity Central Index Key | 1,438,133 |
Entity Filer Category | Smaller Reporting Company |
CONDENSED BALANCE SHEETS
CONDENSED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | ||
Current assets: | |||||
Cash and cash equivalents | $ 12,079 | $ 44,678 | $ 43,088 | ||
Restricted cash | 2,000 | 2,000 | |||
Short-term investments | 459 | 8,860 | 28,018 | ||
Accounts receivable, net | 10,582 | 11,172 | 14,055 | ||
Inventory, net | 29,985 | 21,195 | 17,543 | ||
Prepaid and other current assets | 2,887 | 4,187 | 2,280 | ||
Total current assets | 55,992 | 92,092 | 106,984 | ||
Restricted cash-long-term | 10,000 | ||||
Property and equipment, net | 20,286 | 18,409 | 15,526 | ||
Other long-term assets | 160 | 107 | 105 | ||
Total assets | 87,977 | 112,392 | 124,725 | ||
Current liabilities: | |||||
Accounts payable | 7,605 | 7,513 | 5,234 | ||
Accrued expense | 2,536 | 1,629 | 2,121 | ||
Employee-related liabilities | 11,413 | 10,183 | 11,761 | ||
Deferred revenue | 2,295 | 5,208 | 1,822 | ||
Other current liabilities | 5,562 | 6,943 | 5,582 | ||
Total current liabilities | 29,411 | 31,476 | 26,520 | ||
Notes payable-long-term | 75,596 | 78,960 | 29,275 | ||
Deferred rent-long-term | 4,142 | 2,609 | 2,743 | ||
Other long-term liabilities | 6,786 | 5,274 | 2,719 | ||
Total liabilities | 115,935 | 118,319 | 61,257 | ||
Commitments and contingencies | |||||
Stockholders' equity (deficit): | |||||
Common stock | 5 | [1] | 3 | [1] | 3 |
Additional paid-in capital | 438,244 | 398,651 | 384,578 | ||
Accumulated other comprehensive income (loss) | (1) | 20 | |||
Accumulated deficit | (466,207) | (404,580) | (321,133) | ||
Total stockholders' equity (deficit) | (27,958) | (5,927) | 63,468 | ||
Total liabilities and stockholders' deficit | 87,977 | 112,392 | 124,725 | ||
Patents [Member] | |||||
Current assets: | |||||
Patents, net | $ 1,539 | $ 1,784 | $ 2,110 | ||
[1] | The issued and outstanding shares of common stock have been restated for all periods presented to reflect the effects of the 1-for-10 reverse stock split, which was effective on October 9, 2017 as described in Note 7. |
CONDENSED BALANCE SHEETS (Paren
CONDENSED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | |||
Common stock, par value | $ 0.001 | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 100,000,000 | 100,000,000 | 100,000,000 |
Common stock, shares issued | 5,487,000 | 3,110,000 | 3,026,000 |
Common stock, shares outstanding | 5,487,000 | 3,110,000 | 3,026,000 |
CONDENSED STATEMENTS OF OPERATI
CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) shares in Thousands, $ in Thousands | 9 Months Ended | 12 Months Ended | |||||
Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |||
Income Statement [Abstract] | |||||||
Sales | $ 67,306 | $ 55,336 | $ 84,248 | $ 72,850 | $ 49,722 | ||
Cost of sales | 40,680 | 41,809 | 60,656 | 46,270 | 34,474 | ||
Gross profit (loss) | 26,626 | 13,527 | 23,592 | 26,580 | 15,248 | ||
Operating expenses: | |||||||
Selling, general and administrative | 65,077 | 63,768 | 82,834 | 78,621 | 75,121 | ||
Research and development | 14,910 | 14,464 | 18,809 | 16,963 | 15,791 | ||
Total operating expenses | 79,987 | 78,232 | 101,643 | 95,584 | 90,912 | ||
Operating loss | (53,361) | (64,705) | (78,051) | (69,004) | (75,664) | ||
Other income (expense), net | |||||||
Interest and other income | 179 | 258 | 296 | 337 | 112 | ||
Interest and other expense | (8,445) | (4,177) | (5,707) | (3,741) | (3,901) | ||
Total other expense, net | (8,266) | (3,919) | (5,411) | (3,404) | (3,789) | ||
Loss before taxes | (83,462) | (72,408) | (79,453) | ||||
Provision for income tax (benefit) expense | (15) | 10 | 71 | ||||
Net loss | (61,627) | (68,624) | (83,447) | (72,418) | (79,524) | ||
Other comprehensive loss: | |||||||
Unrealized gain (loss) on short-term investments | 1 | (23) | (21) | 12 | 8 | ||
Comprehensive loss | $ (61,626) | $ (68,647) | $ (83,468) | $ (72,406) | $ (79,516) | ||
Net loss per share, basic and diluted | $ (13.79) | [1] | $ (22.52) | [1] | $ (27.30) | $ (25.04) | $ (34.17) |
Weighted average shares used to compute basic and diluted net loss per share | 4,468 | [1] | 3,047 | [1] | 3,057 | 2,892 | 2,327 |
[1] | The issued and outstanding shares of common stock have been restated for all periods presented to reflect the effects of the 1-for-10 reverse stock split, which was effective on October 9, 2017 as described in Note 7. |
CONDENSED STATEMENTS OF OPERAT5
CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Parenthetical) - Subsequent Event [Member] | Oct. 09, 2017 |
Reverse stock split description | 1-for-10 reverse stock split |
Reverse stock split, conversion ratio | 0.1 |
CONDENSED STATEMENTS OF CASH FL
CONDENSED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Operating activities | |||||
Net loss | $ (61,627) | $ (68,624) | $ (83,447) | $ (72,418) | $ (79,524) |
Adjustments to reconcile net loss to net cash used in operating activities: | |||||
Depreciation and amortization expense | 4,737 | 4,017 | 5,489 | 4,829 | 4,389 |
Interest expense related to amortization of debt discount and debt issuance costs | 1,338 | 194 | 274 | 138 | 219 |
Payment in kind interest accrual of notes payable | 1,236 | 675 | 927 | 153 | |
Provision for allowance for doubtful accounts | 664 | 666 | 632 | 70 | 188 |
Provision for inventory reserve | 316 | 1,805 | 3,343 | 404 | 163 |
Amortization of (discount) premium on short-term investments | (16) | (59) | (85) | 4 | (53) |
Stock-based compensation expense | 10,502 | 8,733 | 11,660 | 13,096 | 14,995 |
Other | 69 | (37) | (78) | (76) | 41 |
Changes in operating assets and liabilities: | |||||
Accounts receivable, net | (73) | 5,191 | 2,251 | (6,473) | (2,541) |
Inventory, net | (9,038) | (7,110) | (6,904) | (6,084) | (1,820) |
Prepaid and other current assets | 1,133 | (1,408) | (2,466) | (395) | (82) |
Other long-term assets | (53) | (8) | (2) | 131 | (150) |
Accounts payable | 522 | 291 | 3,234 | 3,355 | (1,225) |
Accrued expenses | 907 | (144) | (497) | (734) | 973 |
Employee-related liabilities | 797 | (1,225) | (1,578) | 2,039 | 3,846 |
Deferred revenue | (4,137) | 8,528 | 4,610 | 981 | 429 |
Other current liabilities | (601) | 1,348 | 573 | 1,924 | (1,575) |
Deferred rent | (425) | (566) | 1 | (631) | (461) |
Other long-term liabilities | (746) | 142 | 890 | 923 | 810 |
Net cash used in operating activities | (54,495) | (47,591) | (61,173) | (58,764) | (61,378) |
Investing activities | |||||
Purchase of short-term investments | (25,890) | (30,622) | (80,191) | (67,101) | |
Proceeds from sales and maturities of short-term investments | 8,500 | 37,950 | 50,000 | 88,450 | 36,210 |
Purchase of property and equipment | (4,299) | (6,187) | (8,930) | (5,764) | (4,406) |
Purchase of patents | (74) | (173) | |||
Net cash provided by (used in) investing activities | 4,201 | 5,873 | 10,448 | 2,421 | (35,470) |
Financing activities | |||||
Issuance of notes payable, net of issuance costs | 14,994 | 49,994 | 29,925 | ||
Restricted cash in connection with notes payable | (8,000) | 50 | |||
Principal payments on notes payable | (30,000) | ||||
Proceeds from public offering, net of offering costs | 25,125 | 64,862 | |||
Proceeds from issuance of common stock | 570 | 1,592 | 2,321 | 3,393 | 3,664 |
Net cash provided by financing activities | 17,695 | 16,586 | 52,315 | 68,255 | 3,639 |
Net increase (decrease) in cash and cash equivalents | (32,599) | (25,132) | 1,590 | 11,912 | (93,209) |
Cash and cash equivalents at beginning of period | 44,678 | 43,088 | 43,088 | 31,176 | 124,385 |
Cash and cash equivalents at end of period | 12,079 | 17,956 | 44,678 | 43,088 | 31,176 |
Supplemental disclosures of cash flow information | |||||
Interest paid | 5,871 | 3,205 | 4,401 | 3,345 | 3,369 |
Income taxes paid | 23 | 9 | 71 | ||
Supplemental schedule of noncash investing and financing activities | |||||
Lease incentive - lessor-paid tenant improvements | 3,037 | 933 | 1,604 | ||
Property and equipment included in accounts payable & other current liabilities | $ 501 | $ 1,457 | 789 | ||
Debt discount included in other long-term liabilities | 4,116 | 454 | |||
Patent included in accrued expense | $ 74 | ||||
Common stock warrants issued in connection with term loan | 3,331 | ||||
Property and equipment included in accounts payable | $ 72 | $ 802 |
STATEMENTS OF STOCKHOLDERS' EQU
STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT) - USD ($) $ in Thousands | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Other Comprehensive Income [Member] | Accumulated Deficit [Member] |
Balance at Dec. 31, 2013 | $ 115,537 | $ 2 | $ 284,726 | $ (169,191) | |
Balance, Shares at Dec. 31, 2013 | 2,293,000 | ||||
Exercise of common stock warrants | 138 | 138 | |||
Exercise of common stock warrants, Shares | 33,000 | ||||
Exercise of stock options | 325 | 325 | |||
Exercise of stock options, Shares | 14,000 | ||||
Issuance of common stock for Employee Stock Purchase Plan | 3,168 | 3,168 | |||
Issuance of common stock for Employee Stock Purchase Plan, Shares | 25,000 | ||||
Stock-based compensation | 14,920 | 14,920 | |||
Unrealized gain (loss) on short-term investments | 8 | $ 8 | |||
Net loss | (79,524) | (79,524) | |||
Balance at Dec. 31, 2014 | 54,572 | $ 2 | 303,277 | 8 | (248,715) |
Balance, Shares at Dec. 31, 2014 | 2,366,000 | ||||
Exercise of common stock warrants | 122 | 122 | |||
Exercise of common stock warrants, Shares | 2,000 | ||||
Exercise of stock options | $ 337 | 337 | |||
Exercise of stock options, Shares | 24,355 | 24,000 | |||
Issuance of common stock in public offering, net of underwriter's discount and offering costs | $ 64,862 | $ 1 | 64,861 | ||
Issuance of common stock in public offering, net of underwriter's discount and offering costs, Shares | 604,000 | ||||
Issuance of common stock for Employee Stock Purchase Plan | 2,934 | 2,934 | |||
Issuance of common stock for Employee Stock Purchase Plan, Shares | 31,000 | ||||
Stock-based compensation | 13,047 | 13,047 | |||
Unrealized gain (loss) on short-term investments | 12 | 12 | |||
Net loss | (72,418) | (72,418) | |||
Balance at Dec. 31, 2015 | 63,468 | $ 3 | 384,578 | 20 | (321,133) |
Balance, Shares at Dec. 31, 2015 | 3,026,000 | ||||
Exercise of stock options | $ 170 | 170 | |||
Exercise of stock options, Shares | 14,897 | 15,000 | |||
Issuance of common stock for Employee Stock Purchase Plan | $ 2,151 | 2,151 | |||
Issuance of common stock for Employee Stock Purchase Plan, Shares | 69,000 | ||||
Stock-based compensation | 11,752 | 11,752 | |||
Unrealized gain (loss) on short-term investments | (21) | (21) | |||
Net loss | (83,447) | (83,447) | |||
Balance at Dec. 31, 2016 | $ (5,927) | $ 3 | $ 398,651 | $ (1) | $ (404,580) |
Balance, Shares at Dec. 31, 2016 | 3,110,000 | ||||
Exercise of stock options, Shares | 24,408 | ||||
Unrealized gain (loss) on short-term investments | $ 1 | ||||
Net loss | (61,627) | ||||
Balance at Sep. 30, 2017 | $ (27,958) |
Organization and Basis of Prese
Organization and Basis of Presentation | 9 Months Ended | |
Sep. 30, 2017 | Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Organization and Basis of Presentation | 1. Organization and Basis of Presentation The Company Tandem Diabetes Care, Inc. is a medical device company focused on the design, development and commercialization of products for people with insulin-dependent diabetes. The Company is incorporated in the state of Delaware. Unless the context requires otherwise, the terms the “Company” or “Tandem” refer to Tandem Diabetes Care, Inc. The Company manufactures and sells insulin pump products in the United States that are designed to address large and differentiated needs of the insulin-dependent diabetes market. The Company’s pump products currently include: • the t:slim X2 Insulin Delivery System, or t:slim X2, the next-generation flagship product that is updatable and designed to display Dexcom G5 continuous glucose monitoring, or CGM, sensor information directly on the pump Home Screen; and • the t:flex Insulin Delivery System, or t:flex, for people with greater insulin needs. The Company began commercial sales of its first product, t:slim, in August 2012. During 2015, the Company commenced commercial sales of two additional insulin pumps: t:flex in May 2015 and t:slim G4 in September 2015. In October 2016, the Company commenced commercial sales of t:slim X2 and discontinued new sales of t:slim. In August 2017, the Company commenced commercial sales of t:slim X2 with Dexcom G5 Mobile CGM integration, or t:slim X2 with G5, and discontinued new sales of t:slim G4. The Company will continue to provide ongoing service and support to existing t:slim and t:slim G4 customers. In July 2016, the Company received clearance from the U.S. Food and Drug Administration (“FDA”) to begin offering the Tandem Device Updater, a Mac and PC-compatible In July 2016, the Company also announced and launched a Technology Upgrade Program that provided eligible t:slim and t:slim G4 customers a path to obtain t:slim X2, or, as of August 2017, t:slim X2 with G5. Participating customers had the right to exchange their original t:slim and t:slim G4 for a t:slim X2 or t:slim X2 with G5, under a variable pricing structure. The Technology Upgrade Program expired on September 30, 2017. In September 2017, the Company commenced commercial sales of products using the t:lock TM Luer-lok Luer-lok Effective December 31, 2016, the Company adopted FASB Accounting Standard Codification (“ASC”) Topic 205-40, The Company has incurred operating losses since its inception and, as reflected in the accompanying financial statements, the Company has an accumulated deficit of $466.2 million as of September 30, 2017, which reflects a net loss of $61.6 million for the nine months ended September 30, 2017. The Company had cash and cash equivalents and short-term investments of $22.5 million at September 30, 2017, including $10.0 million of restricted cash as required by the Company’s term loan agreement (as amended, the “Term Loan Agreement”) with Capital Royalty Partners II, L.P. and its affiliate funds (“Capital Royalty Partners”). The Company used $54.5 million in cash from operations in the nine months ended September 30, 2017. The Company concluded that, at the date the financial statements were issued, it did not have sufficient cash to fund its operations for the next twelve months without additional financing and, therefore, there was substantial doubt about its ability to continue as a going concern within one year after the date the financial statements were issued. On October 9, 2017, the Company effected a 1-for-10 per-share The Company completed a registered public offering on October 17, 2017, or the October Financing, which resulted in gross proceeds to the Company of $16.2 million, before deducting underwriting discounts and commissions and other offering expenses (see Note 9 “Subsequent Event”). As part of the October Financing, the Company issued 4,630,000 shares of common stock, Series A warrants to purchase 4,630,000 shares of common stock and Series B warrants to purchase 4,630,000 shares of common stock, at a public offering price of $3.50 per share and accompanying warrants. The Series A warrants have an exercise price of $3.50 per share, are immediately exercisable, and will expire on the 5-year anniversary of the date of issuance. The Series B warrants have an exercise price of $3.50 per share, are immediately exercisable, and will expire on the 6-month The Company believes it will be necessary to raise additional funding. The Company intends to seek additional capital from public or private offerings of its capital stock or it may elect to borrow additional amounts under new debt financing arrangements or from other sources. If the Company issues equity or convertible debt securities to raise additional funding, its existing stockholders may experience dilution, it may incur significant financing costs, and the new equity or convertible debt securities may have rights, preferences and privileges senior to those of its existing stockholders. If the Company issues debt securities to raise additional funding, it would incur additional debt service obligations, it could become subject to additional restrictions limiting its ability to operate its business, and it may be required to further encumber its assets. The Company’s ability to continue as a going concern, meet its minimum liquidity requirements, satisfy the covenants under the Term Loan Agreement, and execute its business strategy is dependent on its ability to raise significant additional capital, of which there can be no assurance. If the Company cannot generate sufficient revenues from the sale of its products or secure additional financing on acceptable terms, it may be forced to significantly alter its business strategy, substantially curtail or modify its current operations, or cease operations altogether. Basis of Presentation The Company has prepared the accompanying unaudited condensed financial statements in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information. Accordingly, they do not include all of the information and disclosures required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments which are of a normal and recurring nature, considered necessary for a fair presentation of the financial information contained herein, have been included. Interim financial results are not necessarily indicative of results anticipated for the full year or any other period(s). These unaudited condensed financial statements should be read in conjunction with the Company’s audited financial statements and accompanying footnotes included in the Company’s Annual Report on Form 10-K | 1. Organization and Basis of Presentation The Company Tandem Diabetes Care, Inc. is a medical device company focused on the design, development and commercialization of products for people with insulin-dependent diabetes. The Company is incorporated in the state of Delaware. Unless the context requires otherwise, the terms the “Company” or “Tandem” refer to Tandem Diabetes Care, Inc. The Company manufactures and sells insulin pump products in the United States that are designed to address large and differentiated needs of the insulin-dependent diabetes market. During 2016, the Company’s pump products included: • the t:slim Insulin Delivery System, or t:slim, • the t:flex Insulin Delivery System, or t:flex, • the t:slim G4 Insulin Delivery System, or t:slim G4, and • the t:slim X2 Insulin Delivery System, or t:slim X2. The Company began commercial sales of its first product, t:slim, in August 2012. During 2015, the Company commenced commercial sales of two additional insulin pumps: t:flex in May 2015 and t:slim G4 in September 2015. In July 2016, the Company received clearance from the U.S. Food and Drug Administration (“FDA”) to begin offering the Tandem Device Updater, a Mac and PC-compatible In July 2016, the Company announced and launched a Technology Upgrade Program that provides eligible t:slim and t:slim G4 customers a path to obtain t:slim X2. Participating customers have the right to exchange their original t:slim and t:slim G4 for a t:slim X2, under a variable pricing structure. The Technology Upgrade Program expires on September 30, 2017. In October 2016, the Company began shipping t:slim X2. As a result, the Company discontinued new shipments of t:slim, though the Company will continue to provide ongoing service and support to existing t:slim customers. For the year ended December 31, 2016, the Company has adopted FASB Accounting Standard Codification ASC Topic 205-40, On October 9, 2017, the Company effected a 1-for-10 per-share The Company has incurred operating losses since its inception and, as reflected in the accompanying financial statements, the Company has an accumulated deficit of $404.6 million as of December 31, 2016, which includes a net loss of $83.4 million for the year ended December 31, 2016. Additionally, the Company used $61.2 million in cash for operations in the year ended December 31, 2016, which exceeded cash and cash equivalents and short-term investments of $53.5 million at December 31, 2016. The Company concluded that, at the date its financial statements for the year ended December 31, 2016 were issued, it did not have sufficient cash to fund its operations through December 31, 2017 without additional financing and, therefore, there was substantial doubt about its ability to continue as a going concern within one year after the date the financial statements were issued. As a result, the audit report contained in the accompanying financial statements includes an explanatory paragraph that describes conditions that raise substantial doubt about the Company’s ability to continue as a going concern. This explanatory paragraph could constitute a potential event of default under the Company’s existing term loan agreement (as amended by Consent and Amendment Agreement, dated June 20, 2014, Omnibus Amendment Agreement No. 2, dated February 23, 2015, Amendment No. 3 to Term Loan Agreement, dated January 8, 2016, and Waiver and Amendment No. 4 to Term Loan Agreement, dated March 7, 2017, the “Term Loan Agreement”) with Capital Royalty Partners II L.P. and its affiliate funds (“Capital Royalty Partners”). Accordingly, on March 7, 2017, the Company entered into an amendment to the terms of the Term Loan Agreement (the “Fourth Amendment”) that included a limited waiver of the potential event of default that could have occurred due to the explanatory paragraph included in the audit report. (See Note 5 “Term Loan Agreement” and Note 12 “Subsequent Event.”) The financial statements included in this prospectus have been prepared on a basis that assumes that the Company will continue as a going concern, and do not include any adjustments that may result from the outcome of this uncertainty. This basis of accounting contemplates the recovery of the Company’s assets and the satisfaction of the Company’s liabilities and commitments in the normal course of business and does not include any adjustments to reflect the possible future effects of the recoverability and classification of recorded asset amounts or amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. The Company believes that it will be necessary to raise additional funding in the form of an equity financing from the sale of common stock. The Company may in the future seek additional capital from public or private offerings of its capital stock or it may elect to borrow additional amounts under new credit lines or from other sources. If the Company issues equity or debt securities to raise additional funds, its existing stockholders may experience dilution, it may incur significant financing costs, and the new equity or debt securities may have rights, preferences and privileges senior to those of its existing stockholders. The Company’s ability to continue as a going concern, meet its minimum liquidity requirements in the future or satisfy the other covenants under the Term Loan Agreement is dependent on its ability to raise significant additional capital, of which there can be no assurance. If the Company cannot generate sufficient revenues from the sale of its products or secure additional financing on acceptable terms, it may be forced to significantly alter its business strategy, substantially curtail its current operations, or cease operations altogether. Basis of Presentation The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the Company’s realization of assets and satisfaction of liabilities in the normal course of business. The financial statements do not include any adjustments relating to the recoverability and classification of assets and liabilities that might be necessary should the Company be unable to continue as a going concern. The Company’s continuation as a going concern is dependent upon its ability to raise additional equity or refinance its existing debt and ultimately, to attain profitability. There is no assurance that the Company will be successful in raising additional funds or that, if it does raise additional funds, that it will be able to attain profitability or even continue in business. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended | |
Sep. 30, 2017 | Dec. 31, 2016 | |
Accounting Policies [Abstract] | ||
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies There have been no significant changes in our significant accounting policies during the nine months ended September 30, 2017, as compared with those disclosed in the Annual Report. Use of Estimates The preparation of the financial statements in conformity with U.S. GAAP requires management to make informed estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and the disclosure of contingent assets and liabilities in the Company’s financial statements and accompanying footnotes as of the date of the financial statements. Actual results could materially differ from those estimates and assumptions. Restricted Cash The Company recorded $10.0 million and $2.0 million of restricted cash as of September 30, 2017 and December 31, 2016, respectively, for the minimum cash balance requirement in connection with the Term Loan Agreement (see Note 6, “Term Loan Agreement”). Accounts Receivable The Company grants credit to various customers in the normal course of business. The Company maintains an allowance for doubtful accounts for potential credit losses. Provisions are made based on historical experience, assessment of specific risk, specific review of outstanding invoices, and various additional assumptions and estimates that are believed to be reasonable under the circumstances. Uncollectible accounts are written off against the allowance after appropriate collection efforts have been exhausted and when it is deemed that a balance is uncollectible. Fair Value of Financial Instruments The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable, accrued expenses, and employee-related liabilities are reasonable estimates of their fair values because of the short-term nature of these assets and liabilities. Short-term investments are carried at fair value. Based on the borrowing rates currently available for loans with similar terms, the Company believes that the fair value of its long-term notes payable approximates its carrying value. Certain trade-in Revenue Recognition Revenue is generated primarily from sales in the United States of insulin pumps, disposable cartridges and infusion sets to individual customers and third-party distributors that resell the product to insulin-dependent diabetes customers. The Company is paid directly by customers who use the products, distributors and third-party insurance payors. Revenue is recognized when persuasive evidence of an arrangement exists, delivery has occurred and title passed, the price is fixed or determinable, and collectability is reasonably assured. Trade-In The Company launched a Technology Upgrade Program in 2016, which expired September 30, 2017. The trade-in trade-in trade-in trade-in The Company determined that trade-in trade-in trade-in trade-in trade-in The Company determined that t:slim Pump trade-in in-substance trade-in trade-in trade-in Revenue Recognition for Arrangements with Multiple Deliverables The Company considers the deliverables in its product offering as separate units of accounting and recognizes deliverables as revenue upon delivery only if (i) the deliverable has standalone value and (ii) the arrangement includes a general right of return relative to the delivered item(s) and delivery or performance of the undelivered item(s) is probable and substantially controlled by the Company. The Company allocates consideration to the separate units of accounting, unless the undelivered elements were deemed perfunctory and inconsequential. The amount of the determined guarantee fair value is allocated in full to the guarantee and the remaining allocable consideration is allocated to other separate units of accounting using the relative selling price method, in which allocation of consideration is based on vendor-specific objective evidence (“VSOE”) if available, third-party evidence (“TPE”), or if VSOE and TPE are not available, management’s best estimate of a standalone selling price (“ESP”) for the undelivered elements. The Company offers a cloud-based data management application, t:connect, which is made available to customers upon purchase of any of its insulin pumps. In July 2016, the Company received clearance from the FDA to begin offering the Tandem Device Updater, a Mac and PC-compatible when-and-if-available Product Returns The Company offers a 30-day Warranty Reserve The Company generally provides a four-year warranty on its insulin pumps to end user customers and may replace any pumps that do not function in accordance with the product specifications. Insulin pumps returned to the Company may be refurbished and redeployed. Additionally, the Company offers a six-month At September 30, 2017 and December 31, 2016, the warranty reserve was $4.8 million and $5.7 million, respectively. The following table provides a reconciliation of the change in product warranty liabilities from December 31, 2016 through September 30, 2017 (in thousands): Balance at December 31, 2016 $ 5,690 Provision for warranties issued during the period 4,110 Settlements made during the period (5,240 ) Increases in warranty estimates 190 Balance at September 30, 2017 $ 4,750 Current portion $ 2,080 Non-current 2,670 Total $ 4,750 Stock-Based Compensation Stock-based compensation cost is measured at the grant date based on the estimated fair value of the award, and the portion that is ultimately expected to vest is recognized as compensation expense over the requisite service period on a straight-line basis. The Company estimates the fair value of stock options issued under the Company’s 2013 Stock Incentive Plan (“2013 Plan”) and shares issued under the Company’s 2013 Employee Stock Purchase Plan (“ESPP”) using a Black-Scholes option-pricing model on the date of grant. The Black-Scholes option-pricing model requires the use of subjective assumptions about a number of key variables, including stock price volatility, expected term, and risk-free interest rate. For awards that vest based on the achievement of service conditions, the Company recognizes expense using the straight-line method less estimated forfeitures based on historical experience. 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 common stock equivalents. Diluted net loss per share is calculated by dividing the net loss by the sum of the weighted average number of common shares that were outstanding for the period and the weighted-average number of dilutive common share equivalents outstanding for the period determined using the treasury stock method. Dilutive common share equivalents are comprised of warrants, options outstanding under the Company’s equity incentive plans, and shares subject to issuance pursuant to the ESPP. For all periods presented, there is no difference in the number of shares used to calculate basic and diluted shares outstanding due to the Company’s net loss position. Potentially dilutive securities not included in the calculation of diluted net loss per share (because inclusion would be anti-dilutive) are as follows (in thousands, in common stock equivalent shares): Nine Months Ended September 30, 2017 2016 Common stock warrants — 99 Common stock options 3 262 ESPP — 7 3 368 Recent Accounting Pronouncements In August 2016, the Financial Accounting Standards Board (“FASB”) issued new guidance that clarifies how entities should classify certain cash receipts and cash payments on the statement of cash flows. The guidance also clarifies how the predominance principle should be applied when cash receipts and cash payments have aspects of more than one class of cash flows. The guidance is effective for public companies for fiscal years beginning after December 15, 2017, and interim periods within those years. The Company does not believe the adoption of the standard will have a material impact on the Company’s statement of cash flow. In June 2016, FASB issued a new credit loss standard that changes the impairment model for most financial assets and certain other instruments. The standard is effective for public business entities for annual periods beginning after December 15, 2019, and interim periods within those years. Early adoption is permitted for all entities for annual periods beginning after December 15, 2018, and interim periods within those years. The Company is in the process of assessing the impact of the adoption of the standard on its financial statements. In March 2016, FASB issued ASU 2016-09, 2016-09”), 2016-09 In February 2016, FASB issued final guidance for lease accounting. The new guidance requires lessees to put most leases on their balance sheet but to recognize expenses on their income statement in a manner similar to current accounting principles. The new guidance also eliminates the current real estate-specific provisions for all entities. The standard is effective for public companies for annual periods beginning after December 15, 2018, and interim periods within those years. Early adoption is permitted for all entities. The Company is in the process of assessing the impact of the adoption of the standard on its financial statements. In May 2014, FASB and the International Accounting Standards Board issued a comprehensive new revenue recognition standard (“Revenue from Contracts with Customers Standard”) that will supersede existing revenue guidance under U.S. GAAP and International Financial Reporting Standards. The Revenue from Contracts with Customers Standard’s core principle is that a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. In doing so, companies will need to use more judgment and make more estimates than under current guidance. The Revenue from Contracts with Customers Standard will be effective for the Company beginning in its first quarter of 2018, and early adoption is permitted. Subsequently, FASB issued the following standards related to Revenue from Contracts with Customers Standard: Principal versus Agent Considerations; Identifying Performance Obligations and Licensing; and Narrow-Scope Improvements and Practical Expedients (collectively, the “new revenue standards”). The new revenue standards may be applied retrospectively to each prior period presented (full retrospective method) or retrospectively with the cumulative effect recognized as of the date of adoption (the modified retrospective method). The Company currently expects to adopt the new revenue standards in the first quarter of 2018 utilizing the modified retrospective method. The Company currently believes that the adoption will not have a material impact on the recognition of revenues for the sale of its products through third-party distributors and insurance payors with whom it has contractual arrangements, which generally comprise approximately 99% of its sales. Additionally, the Company has given consideration to the accounting for warranty and commissions and does not anticipate a material change to its current method of expense recognition. As of September 30, 2017, the Company has not determined the full impact the adoption of the new revenue standard may have on its reported revenue or results of operations. | 2. Summary of Significant Accounting Policies Use of Estimates The preparation of the financial statements in conformity with GAAP requires management to make informed estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and the disclosure of contingent assets and liabilities in the Company’s financial statements and accompanying notes as of the date of the financial statements. Actual results could differ materially from those estimates and assumptions. Segment Reporting Operating segments are identified as components of an enterprise about which segment discrete financial information is available for evaluation by the chief operating decision-maker in making decisions regarding resource allocation and assessing performance. To date, the Company has viewed its operations and managed its business as one segment, operating in the United States. Cash and Cash Equivalents The Company considers all highly liquid investments with a maturity of three months or less from the date of purchase and that can be liquidated without prior notice or penalty, to be cash equivalents. Short-Term Investments Based on the nature of the assets, the Company’s short-term investments are classified as either available-for-sale available-for-sale held-to-maturity. available-for-sale available-for-sale Restricted Cash Restricted cash as of December 31, 2016 and 2015 was comprised of a $2.0 million minimum cash balance requirement in connection with the Term Loan Agreement (see Note 5, “Term Loan Agreement”). Accounts Receivable The Company grants credit to various customers in the normal course of business. The Company maintains an allowance for doubtful accounts for potential credit losses. Provisions are made based on historical experience, assessment of specific risk, specific review of outstanding invoices or various assumptions and estimates that are believed to be reasonable under the circumstances. Uncollectible accounts are written off against the allowance after appropriate collection efforts have been exhausted and when it is deemed that a balance is uncollectible. Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash, cash equivalents, short-term investments and accounts receivable. The Company maintains deposit accounts in federally insured financial institutions in excess of federally insured limits. The Company also maintains investments in money market funds that are not federally insured. Additionally, the Company has established guidelines regarding investment instruments and their maturities, which are designed to maintain preservation of principal and liquidity. The following table summarizes customers who accounted for 10% or more of net accounts receivable: December 31, 2016 2015 Edgepark Medical Supplies, Inc. 15.2 % 16.4 % Byram Healthcare 14.7 % 21.8 % The following table summarizes customers who accounted for 10% or more of sales for the periods presented: December 31, 2016 2015 2014 Edgepark Medical Supplies, Inc. 18.7 % 17.8 % 16.0 % Byram Healthcare 14.0 % 17.2 % 10.9 % Solara Medical Supplies, Inc. 10.7 % N/A N/A CCS Medical N/A N/A 11.6 % Fair Value of Financial Instruments The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable, accrued expense, and employee-related liabilities are reasonable estimates of their fair values because of the short-term nature of these assets and liabilities. Short-term investments and foreign exchange forward contracts that are not designated as hedges are carried at fair value. Based on the borrowing rates currently available for loans with similar terms, the Company believes that the fair value of its long-term notes payable approximates its carrying value. The Company offers to certain eligible customers trade-in Inventories Inventories are valued at the lower of cost or market (net realizable value), determined by the first-in, first-out Long Lived Assets Property and Equipment Property and equipment, which primarily consist of office furniture and equipment, manufacturing equipment, scientific equipment, computer equipment, and leasehold improvements, are stated at cost. Property and equipment are depreciated over the estimated useful lives of the assets, generally three to seven years, using the straight-line method. Leasehold improvements are amortized over the lesser of the estimated useful lives of the assets or the remaining lease term. Maintenance and repair costs are expensed as incurred. Patents Costs associated with the purchase or licensing of patents associated with the Company’s commercialized products are capitalized. The Company reviews its capitalized patent costs periodically to determine that they have future value and an alternative future use. Costs related to patents that the Company is not actively pursuing for commercial purposes are expensed. The Company amortizes patent costs over the lesser of the duration of the patent term or the estimated useful lives of 10 years, beginning with the date the patents are issued or acquired. The Company periodically re-evaluates Deferred Rent Rent expense on noncancelable leases containing known future scheduled rent increases is recorded on a straight-line basis over the term of the respective leases beginning when the Company takes possession of the leased property. The difference between rent expense and rent paid is accounted for as deferred rent. The current portion of deferred rent was included in other current liabilities on the Company’s balance sheet. Landlord improvement allowances and other such lease incentives are recorded as property and equipment and as deferred rent and are amortized on a straight-line basis as a reduction to rent expense. Research and Development Costs All research and development costs are charged to expense as incurred. Such costs include personnel-related costs, including stock-based compensation, supplies, license fees, development prototypes, outside design and testing services, depreciation, allocated facilities and information services, milestone payments under the Company’s development and commercialization agreements and other indirect costs. Income Taxes The Company uses the asset and liability method of accounting for income taxes. Deferred income tax assets or liabilities are recognized based on the temporary differences between financial statement and income tax bases of assets and liabilities using enacted tax rates in effect for the years in which the differences are expected to reverse. A valuation allowance is recorded when it is more likely than not that some of the deferred tax assets will not be realized. The Company is required to file federal and state income tax returns in the United States and various other state jurisdictions. The preparation of these income tax returns requires the Company to interpret the applicable tax laws and regulations in effect in such jurisdictions, which could affect the amount of tax paid by the Company. An amount is accrued for the estimate of additional tax liability, including interest and penalties, for any uncertain tax positions taken or expected to be taken in an income tax return. The Company reviews and updates the accrual for uncertain tax positions as more definitive information becomes available. For further information, see Note 7, “Income Taxes.” Revenue Recognition Revenue is generated from sales in the United States of insulin pumps, disposable cartridges and infusion sets to individual customers and third-party distributors that resell the product to insulin-dependent diabetes customers. The Company is paid directly by customers who use the products, distributors and third-party insurance payors. Revenue is recognized when persuasive evidence of an arrangement exists, delivery has occurred and title passed, the price is fixed or determinable, and collectability is reasonably assured. Trade-In The trade-in trade-in trade-in trade-in The Company has determined that trade-in trade-in trade-in, trade-in trade-in The Company has determined that t:slim Pump trade-in in-substance trade-in trade-in trade-in Revenue Recognition for Arrangements with Multiple Deliverables The Company considers the deliverables in its product offering as separate units of accounting and recognizes deliverables as revenue upon delivery only if (i) the deliverable has standalone value and (ii) if the arrangement includes a general right of return relative to the delivered item(s), delivery or performance of the undelivered item(s) is probable and substantially controlled by the Company. The Company allocates consideration to the separate units of accounting, unless the undelivered elements were deemed perfunctory and inconsequential. The amount of the determined guarantee fair value is allocated in full to the guarantee and the remaining allocable consideration is allocated to other separate units of accounting using the relative selling price method, in which allocation of consideration is based on vendor-specific objective evidence (“VSOE”) if available, third-party evidence (“TPE”), or if VSOE and TPE are not available, management’s best estimate of a standalone selling price (“ESP”) for the undelivered elements. The Company offers a cloud-based data management application, t:connect, which is made available to customers upon purchase of any of its insulin pumps. In July 2016, the Company received clearance from the FDA to begin offering the Tandem Device Updater, a Mac and PC-compatible when-and-if-available Product Returns The Company offers a 30-day Warranty Reserve The Company generally provides a four-year warranty on its insulin pumps to end user customers and may replace any pumps that do not function in accordance with the product specifications. Insulin pumps returned to the Company may be refurbished and redeployed. Additionally, the Company offers a six-month At December 31, 2016 and December 31, 2015, the warranty reserve was $5.7 million and $3.5 million, respectively. The following table provides a reconciliation of the change in estimated warranty liabilities for the years ended December 31, 2016 and 2015: December 31, (in thousands) 2016 2015 Balance at beginning of the year $ 3,547 $ 1,974 Provision for warranties issued during the period 8,830 1,948 Settlements made during the period (8,739 ) (4,373 ) Increases in warranty estimates 2,052 3,998 Balance at end of the year $ 5,690 $ 3,547 Current portion $ 2,302 $ 1,050 Non-current $ 3,388 2,497 Total $ 5,690 $ 3,547 Stock-Based Compensation Stock-based compensation cost is measured at the grant date based on the estimated fair value of the award, and the portion that is ultimately expected to vest is recognized as compensation expense over the requisite service period on a straight-line basis. The Company estimates the fair value of stock options issued under the Company’s 2013 Stock Incentive Plan (“2013 Plan”) and shares issued under the Company’s 2013 Employee Stock Purchase Plan (“ESPP”) using a Black-Scholes option-pricing model on the date of grant. The Black-Scholes option-pricing model requires the use of subjective assumptions including volatility, expected term, and risk-free rate. For awards that vest based on service conditions, the Company recognizes expense using the straight-line method less estimated forfeitures based on historical experience. The Company records the expense for stock option grants to non-employees non-employee Advertising Costs The Company expenses advertising costs as they are incurred. For the years ended December 31, 2016, 2015 and 2014, advertising costs were $0.9 million, $1.0 million, and $1.5 million, respectively. Shipping and Handling Expenses Shipping and handling expenses associated with product delivery are included within cost of sales in the Company’s statements of operations. Comprehensive Loss All components of comprehensive loss, including net loss, are reported in the financial statements in the period in which they are recognized. Comprehensive loss is defined as the change in equity during a period from transactions and other events and circumstances from non-owner 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 common stock equivalents. Diluted net loss per share is calculated by dividing the net loss by the sum of the weighted-average number of dilutive common share equivalents outstanding for the period determined using the treasury stock method. Dilutive common share equivalents are comprised of warrants, potential awards granted pursuant to the ESPP, and options outstanding under the Company’s other equity incentive plans. For all periods presented, there is no difference in the number of shares used to calculate basic and diluted shares outstanding due to the Company’s net loss position. Potentially dilutive securities not included in the calculation of diluted net loss per share (because inclusion would be anti-dilutive) are as follows (in common stock equivalent shares, in thousands): Year Ended December 31, 2016 2015 2014 Warrants for common stock — 99 100 Common stock options 151 201 223 ESPP 2 0 0 153 3,00 323 Reclassifications Certain reclassifications of prior year amounts have been made to conform to the current year presentation. Recent Accounting Pronouncements In August 2016, the Financial Accounting Standards Board (“FASB”) issued new guidance that clarifies how entities should classify certain cash receipts and cash payments on the statement of cash flows. The guidance also clarifies how the predominance principle should be applied when cash receipts and cash payments have aspects of more than one class of cash flows. The guidance is effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those years. The Company does not believe the adoption of the standard will have a material impact on the Company’s statement of cash flow. In June 2016, FASB issued a new credit loss standard that changes the impairment model for most financial assets and certain other instruments. The standard is effective for public business entities for annual periods beginning after December 15, 2019, and interim periods within those years. Early adoption is permitted for all entities for annual periods beginning after December 15, 2018, and interim periods within those years. The Company is in the process of assessing the impact of the adoption of the standard on its financial statements. In March 2016, FASB issued ASU 2016-09, 2016-09”), 2016-09 In February 2016, FASB issued final guidance for lease accounting. The new guidance requires lessees to put most leases on their balance sheet but to recognize expenses on their income statement in a manner similar to today’s accounting. The new guidance also eliminates today’s real estate-specific provisions for all entities. The standard is effective for public business entities for annual periods beginning after December 15, 2018, and interim periods within those years. Early adoption is permitted for all entities. The Company is in the process of assessing the impact of the adoption of the standard on its financial statements. In April 2015, FASB issued new guidance, which amended requirements that require debt issuance costs, related to a recognized debt liability, to be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, effective for the Company beginning January 1, 2016 and applied retroactively for all consolidated balance sheets presented. The Company applied the amended presentation requirements in the first quarter 2016, which resulted in the reclassification of $0.4 million of debt issuance costs in the Company’s balance sheet from other long-term assets to long-term notes payable at December 31, 2015. In August 2014, FASB issued an accounting standards update, which requires management of public and private companies to evaluate whether there are conditions and events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the financial statements are issued (or available to be issued when applicable) and, if so, to disclose that fact. Management is required to make this evaluation for both annual and interim reporting periods, if applicable. Management is also required to evaluate and disclose whether its plans alleviate that doubt. The standard is effective for annual periods ending after December 15, 2016, and interim periods within annual periods beginning after December 15, 2016. The Company adopted this standard as of December 31, 2016 and has included the expanded discussion on going concern above (see Note 1 “The Company”). In May 2014, FASB and the International Accounting Standards Board issued a comprehensive new revenue recognition standard (“Revenue from Contracts with Customers Standard”) that will supersede existing revenue guidance under U.S. GAAP and International Financial Reporting Standards. The Revenue from Contracts with Customers Standard’s core principle is that a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. In doing so, companies will need to use more judgment and make more estimates than under current guidance. The Revenue from Contracts with Customers Standard will be effective for the Company beginning in its first quarter of 2018, and early adoption is permitted. Subsequently, FASB issued the following standards related to Revenue from Contracts with Customers Standard: Principal versus Agent Considerations; Identifying Performance Obligations and Licensing; and Narrow-Scope Improvements and Practical Expedients. (collectively, the “new revenue standards”). The new revenue standards may be applied retrospectively to each prior period presented (full retrospective method) or retrospectively with the cumulative effect recognized as of the date of adoption (the modified retrospective method). The Company currently expects to adopt the new revenue standards in its first quarter of 2018 utilizing the modified retrospective method. The Company has begun assessing the impact of the adoption of the new revenue standards on its financial statements, and will not know whether there will be any impact of adoption until its assessment is completed sometime later in 2017. |
Short-Term Investments
Short-Term Investments | 9 Months Ended |
Sep. 30, 2017 | |
Investments, Debt and Equity Securities [Abstract] | |
Short-Term Investments | 3. Short-Term Investments The Company invests in investment securities, principally debt instruments of financial institutions and corporations with strong credit ratings. The following represents a summary of the estimated fair value of short-term investments at September 30, 2017 and December 31, 2016 (in thousands): At September 30, 2017 Maturity (in years) Amortized Cost Unrealized Gain Unrealized Loss Estimated Fair Value Trading securities: Mutual funds held for nonqualified deferred compensation plan participants $ 416 $ 43 $ — $ 459 Total $ 416 $ 43 $ — $ 459 At December 31, 2016 Maturity (in years) Amortized Cost Unrealized Gain Unrealized Loss Estimated Fair Value Available-for-sale Commercial paper Less than 1 $ 8,483 $ 1 $ (2 ) $ 8,482 Trading securities: Mutual funds held for nonqualified deferred compensation plan participants $ 354 $ 26 $ (2 ) $ 378 Total $ 8,837 $ 27 $ (4 ) $ 8,860 |
Inventory
Inventory | 9 Months Ended |
Sep. 30, 2017 | |
Inventory Disclosure [Abstract] | |
Inventory | 4. Inventory Inventory consisted of the following at September 30, 2017 and December 31, 2016 (in thousands): September 30, December 31, 2017 2016 Raw materials $ 10,138 $ 9,375 Work in process 5,497 4,395 Finished goods 14,350 7,425 Total $ 29,985 $ 21,195 The increase in inventory at September 30, 2017 as compared to December 31, 2016 is primarily due to an increase in infusion set finished goods in connection with the commercial launch of the t:lock infusion set. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended | |
Sep. 30, 2017 | Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | ||
Fair Value Measurements | 5. Fair Value Measurements Authoritative guidance on fair value measurements defines fair value, establishes a consistent framework for measuring fair value, and expands disclosures for each major asset and liability category measured at fair value on either a recurring or a nonrecurring basis. Fair value is intended to reflect an assumed exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the authoritative guidance establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: Level 1: Observable inputs such as unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. Level 2: Inputs, other than quoted prices in active markets, that are observable either directly or indirectly for substantially the full term of the asset or liability. Level 3: Unobservable inputs in which there is little or no market data and that are significant to the fair value of the assets or liabilities, which require the reporting entity to develop its own valuation techniques that require input assumptions. The following table presents information about the Company’s financial assets and liabilities measured at fair value on a recurring basis as of September 30, 2017 and December 31, 2016, and indicates the fair value hierarchy of the valuation techniques utilized by the Company to determine such fair value (in thousands): Fair Value Measurements at September 30, 2017 (Level 1) (Level 2) (Level 3) Assets Cash equivalents (1) $ 16,527 $ 16,527 $ — $ — Mutual funds held for nonqualified deferred compensation plan participants (2) 459 459 — — Total assets $ 16,986 $ 16,986 $ — $ — Liabilities Deferred compensation (2) $ 459 $ 459 $ — $ — Total liabilities $ 459 $ 459 $ — $ — Fair Value Measurements at December 31, 2016 (Level 1) (Level 2) (Level 3) Assets Cash equivalents (1) $ 39,941 $ 39,941 $ — $ — Commercial paper 8,482 — 8,482 — Mutual funds held for nonqualified deferred compensation plan participants (2) 378 378 — — Total assets $ 48,801 $ 40,319 $ 8,482 $ — Liabilities Deferred compensation (2) $ 378 $ 378 $ — $ — Total liabilities $ 378 $ 378 $ — $ — (1) Generally, cash equivalents include money market funds and investments with a maturity of three months or less from the date of purchase. This asset is included as a component of cash and cash equivalents on the balance sheet, of which $10.0 million is classified as restricted cash - long-term at September 30, 2017. (2) The deferred compensation plan is directed by the Company and structured as a Rabbi Trust for the benefit of certain executives and non-employee The Company’s Level 2 financial instruments are valued using market prices on less active markets with observable valuation inputs such as interest rates and yield curves. The Company obtains the fair value of Level 2 financial instruments from quoted market prices, calculated prices or quotes from third-party pricing services. The Company validates these prices through independent valuation testing and review of portfolio valuations provided by the Company’s investment managers. There were no transfers between Level 1 and Level 2 assets during the nine months ended September 30, 2017. The Company recorded $1.2 million as guarantee liabilities in other current liabilities on the accompanying condensed balance sheet at December 31, 2016. There were no guarantee liabilities at September 30, 2017. Guarantees were recorded as a reduction of revenue in the statement of operations and other comprehensive loss. Guarantees are not measured at fair value on a recurring basis, and therefore are not included in the tables above. Guarantees are classified within Level 3 of the fair value hierarchy. The estimated fair value of the guarantees is based on various economic and customer behavioral assumptions, including the probability that a trade-in right will be exercised, the specified trade-in amount, the expected fair value of the used t:slim G4 Pump at trade-in trade-in In connection with the Term Loan Agreement, on March 7, 2017, the Company issued ten-year warrants to purchase 193,788 shares of the Company’s common stock at an exercise price of $23.50 per share (the “Capital Royalty Warrant”). The Company used the Black-Scholes option-pricing model to calculate the value of the Capital Royalty Warrant of approximately $3.3 million. The Capital Royalty Warrant was recorded as debt discount and stockholders’ equity, as the warrants met the definition of an equity instrument. The Black-Scholes option-pricing model requires the use of subjective assumptions about a number of key variables, including stock price volatility, expected term, and risk-free interest rate. | 4. Fair Value Measurements Authoritative guidance on fair value measurements defines fair value, establishes a consistent framework for measuring fair value, and expands disclosures for each major asset and liability category measured at fair value on either a recurring or a nonrecurring basis. Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the authoritative guidance establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: Level 1: Observable inputs such as unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities. Level 2: Inputs, other than quoted prices in active markets, that are observable either directly or indirectly for substantially the full term of the asset or liability. Level 3: Unobservable inputs in which there is little or no market data and that are significant to the fair value of the assets or liabilities, which require the reporting entity to develop its own valuation techniques that require input assumptions. The following table presents information about the Company’s financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2016 and 2015, and indicates the fair value hierarchy of the valuation techniques utilized by the Company to determine such fair value (in thousands): Fair Value Measurements at December 31, 2016 December 31, 2016 Level 1 Level 2 Level 3 Assets Cash equivalents (1) $ 39,941 $ 39,941 $ — $ — Commercial paper 8,482 — 8,482 — Mutual funds held for nonqualified deferred compensation plan participants (2) 378 378 — — Total assets $ 48,801 $ 40,319 $ 8,482 $ — Liabilities Deferred compensation (2) $ 378 $ 378 $ — $ — Total liabilities $ 378 $ 378 $ — $ — Fair Value Measurements at December 31, 2015 December 31, 2015 Level 1 Level 2 Level 3 Assets Cash equivalents (1) $ 23,402 $ 23,402 $ — $ — Commercial paper 21,735 — 21,735 — Mutual funds held for nonqualified deferred compensation plan participants (2) 222 222 — — Treasury securities 2,034 2,034 — — Government-sponsored enterprise securities 4,027 — 4,027 — Total assets $ 51,420 $ 25,658 $ 25,762 $ — Liabilities Deferred compensation (2) $ 222 $ 222 $ — $ — Total liabilities $ 222 $ 222 $ — $ — (1) Cash equivalents included money market funds and commercial paper with a maturity of three months or less from the date of purchase. (2) Deferred compensation plans are compensation plans directed by the Company and structured as a Rabbi Trust for certain executives and non-employee The Company’s Level 2 financial instruments are valued using market prices on less active markets with observable valuation inputs such as interest rates and yield curves. The Company obtains the fair value of Level 2 financial instruments from quoted market prices, calculated prices or quotes from third-party pricing services. The Company validates these prices through independent valuation testing and review of portfolio valuations provided by the Company’s investment managers. There were no transfers between Level 1 and Level 2 securities during the years ended December 31, 2016 and 2015. As of December 31, 2016, the Company recorded a $1.2 million as a guarantee liability in other current liabilities on the accompanying balance sheet, and as a reduction of revenue in the statement of operations and other comprehensive loss. Guarantees are not measured at fair value on a recurring basis; they are not included in the tables above. Guarantees are classified within Level 3 of the fair value hierarchy. The estimated fair value of the guarantee is based on various economic and customer behavioral assumptions, including the probability that a trade-in trade-in trade-in trade-in |
Term Loan Agreement
Term Loan Agreement | 9 Months Ended | |
Sep. 30, 2017 | Dec. 31, 2016 | |
Debt Disclosure [Abstract] | ||
Term Loan Agreement | 6. Term Loan Agreement The Company had $82.3 million and $81.1 million of aggregate borrowings outstanding under the Term Loan Agreement, at September 30, 2017 and December 31, 2016, respectively. Under the Term Loan Agreement, interest is payable at the Company’s option, (i) in cash at a rate of 11.5% per annum, or (ii) at a rate of 9.5% of the 11.5% per annum in cash and 2.0% of the 11.5% per annum (the “PIK Loan”) to be added to the principal of the loan and subject to accruing interest. Interest-only payments are due quarterly on March 31, June 30, September 30 and December 31 of each year of the interest-only payment period, which ends on December 31, 2019. The principal balance is due in full at the end of the term of the loan, which is March 31, 2020 (the “Maturity Date”). The Company had elected to pay interest in cash at a rate of 11.5% per annum through September 30, 2015. Beginning October 1, 2015, the Company elected to pay interest in cash at a rate of 9.5% per annum and for a rate of 2.0% per annum to be added to the principal of the loan. As a result, $2.3 million was added to the principal of the loan since October 1, 2015, which the Company refers to as PIK Loans. The term loan is collateralized by all assets of the Company. The principal financial covenants require that the Company attain minimum annual revenues of $80.0 million in 2017 and $95.0 million each year thereafter until the Maturity Date. Pursuant to Amendment No. 3 to Term Loan Agreement (the “Third Amendment”), the Company agreed to pay, on the earlier of (i) the Maturity Date, (ii) the date that the loan under the Term Loan Agreement becomes due, and (iii) the date on which the Company makes a voluntary pre-payment of the loan, a financing fee equal to 3.0% of the sum of (x) the aggregate amount drawn under the Third Amendment, which is $50.0 million, and (y) any PIK Loans issued in relation to the Third Amendment (collectively, the “Back End Financing Fee”). The audit report of the Company’s independent registered public accounting firm contained in the Annual Report included an explanatory paragraph that describes conditions that raise substantial doubt about the Company’s ability to continue as a going concern. This explanatory paragraph constituted a potential event of default under the Term Loan Agreement. On March 7, 2017, the Company entered into Waiver and Amendment No. 4 to the Term Loan Agreement (the “Fourth Amendment”), which included a limited waiver of the potential event of default that could have resulted from the explanatory paragraph. In consideration for the waiver, the Company agreed to: (i) issue the Capital Royalty Warrant, (ii) increase its restricted cash balance from $2.0 million to $10.0 million, (iii) provide Capital Royalty Partners the same information it makes available to its board of directors, subject to limited exceptions, and (iv) not incur additional third party indebtedness secured solely by accounts receivable, inventory and cash. In addition, the Fourth Amendment includes a covenant requiring the Company to complete financings in which its gross proceeds from the sale of equity securities is at least $30.0 million, no later than January 15, 2018. Furthermore, the Company agreed to increase the Back End Financing Fee to 5.0% of the entire aggregate principal amount of borrowings outstanding, including total PIK Loans issued. The Back End Financing Fee is payable at maturity of the Company’s loans and on the principal amount of any loans for which it makes an optional prepayment, and may be payable in connection with certain asset sales or a change of control. As of September 30, 2017 and December 31, 2016, respectively, the Company had accrued $4.1 million and $1.5 million for the Back End Financing Fee in other long-term liabilities and as contra-debt in notes payable-long-term on the accompanying condensed balance sheets. The Company evaluated execution of the Fourth Amendment as a modification for accounting purposes and concluded that it did not constitute a modification because the present value of the future cash flows under the Fourth Amendment did not exceed the present value of the future cash flows under the previous terms by more than 10%. The Back End Financing Fee, the value of the Capital Royalty Warrant, and the remaining balance of debt issuance costs and debt discount of the loan are amortized to interest expense over the remaining term of the Term Loan Agreement using the effective interest method. | 5. Term Loan Agreement At December 31, 2015, the Company had $30.2 million aggregate borrowings outstanding under the Term Loan Agreement. In January 2016, the Company entered into Amendment No. 3 to the Term Loan Agreement (the “Third Amendment”) which allowed the Company to borrow up to an additional $50.0 million. The Company borrowed $15.0 million of this amount in January 2016 and the remaining $35.0 million in December 2016. At December 31, 2016, the Company had $81.1 million of aggregate borrowings outstanding under the Term Loan Agreement. The other principal terms of the Term Loan Agreement were not amended by the Third Amendment. Accordingly, interest continues to be payable, at the Company’s option, (i) in cash at a rate of 11.5% per annum, or (ii) at a rate of 9.5% of the 11.5% per annum in cash and 2.0% of the 11.5% per annum (the “PIK Loan”) to be added to the principal of the loan and subject to accruing interest. Interest-only payments continue to be due quarterly on March 31, June 30, September 30 and December 31 of each year of the interest-only payment period, which ends on December 31, 2019. The principal balance continues to be due in full at the end of the term of the loan, which is March 31, 2020 (the “Maturity Date”). The Company had elected to pay interest in cash at a rate of 11.5% per annum through September 30, 2015. Beginning October 1, 2015, the Company elected to pay interest in cash at a rate of 9.5% per annum and for a rate of 2.0% per annum to be added to the principal of the loan. As a result, $0.9 million and $0.2 million was added to the principal of the loan for the year ended December 31, 2016 and three months ended December 31, 2015, respectively. which the Company refers to as PIK Loans. The Term Loan Agreement provides for prepayment fees in an amount equal to one percent (1.0%) of the outstanding balance of the loan if the loan is repaid prior to March 31, 2017, after which there is no prepayment fee. The term loan is collateralized by all assets of the Company. The principal financial covenants continue to require that the Company attain minimum annual revenues of $65.0 million in 2016, $80.0 million in 2017 and $95.0 million each year thereafter until the Maturity Date. Pursuant to the Third Amendment, the Company has agreed to pay, on the earlier of (i) the Maturity Date, (ii) the date that the loan under the Term Loan Agreement becomes due, and (iii) the date on which the Company makes a voluntary pre-payment The Company treated execution of the Third Amendment as a modification for accounting purposes. The present value of the future cash flows under the Third Amendment did not exceed the present value of the future cash flows under the previous terms by more than 10%. The Back End Financing Fee and the remaining balance of debt issuance costs and debt discount of the loan are amortized to interest expense over the remaining term of the Third Amendment using the effective interest method. Future minimum principal payments under the Term Loan Agreement as of December 31, 2016, are as follows (in thousands): Year ended December 31, 2017 $ — 2018 — 2019 — 2020 81,080 2021 — Thereafter — Total $ 81,080 Less current portion of notes payable — Notes payable, net of current portion $ 81,080 The audit report and opinion of the Company’s independent registered public accounting firm contained in the accompanying financial statements includes an explanatory paragraph that describes conditions that raise substantial doubt about its ability to continue as a going concern. This explanatory paragraph included in the report of the Company’s independent registered public accounting firm could constitute a potential event of default under the Term Loan Agreement. On March 7, 2017, the Company entered into the Fourth Amendment, which includes a limited waiver of a potential event of default that could have resulted from the explanatory paragraph. In consideration for the waiver, the Company agreed to: (i) issue Capital Royalty Partners ten-year |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) | 9 Months Ended | |
Sep. 30, 2017 | Dec. 31, 2016 | |
Equity [Abstract] | ||
Stockholders' Equity (Deficit) | 7. Stockholders’ Equity Public Offering In the first quarter of 2017, the Company completed a public offering of 1,850,000 shares of its common stock at a public offering price of $12.50 per share. The gross proceeds to the Company from the offering were $23.1 million, before deducting underwriting discounts and commissions and other offering expenses payable by the Company. At The Market (ATM) Program In July 2017, the Company entered into an Equity Distribution Agreement implementing an ATM program for aggregate gross proceeds up to $15.0 million. During the nine months ended September 30, 2017, the Company sold 464,108 shares of common stock under the ATM program at prices ranging from $5.64 to $10.54. The gross proceeds to the Company from these sales were $4.3 million, before deducting underwriting discounts and commissions and other offering expenses payable by the Company. Shares Reserved for Future Issuance The following shares of the Company’s common stock were reserved for future issuance at September 30, 2017 (in thousands): Shares underlying outstanding warrants 293 Shares underlying outstanding stock options 933 Shares authorized for future equity award grants 39 Shares authorized for issuance as ESPP awards — 1,265 The Company issued 24,408 shares of its common stock upon the exercise of stock options during the nine months ended September 30, 2017, and issued 14,897 shares of its common stock upon the exercise of stock options during the year ended December 31, 2016. The ESPP enables eligible employees to purchase shares of the Company’s common stock using their after tax payroll deductions, subject to certain conditions. The ESPP consists of a two-year offering period with four six-month The Company announced the suspension of the ESPP as of May 16, 2017 due to a lack of available shares. The suspension was accounted for as a cancellation of an award with no consideration. The previously unrecognized compensation cost as of the suspension date of $2.4 million was fully expensed during the second quarter of 2017. Stock-Based Compensation The assumptions used in the Black-Scholes option-pricing model are as follows: Stock Options Nine Months Ended September 30, 2017 2016 Weighted average grant date fair value (per share) $ 5.10 $ 37.80 Risk-free interest rate 1.9 % 1.4 % Expected dividend yield 0.0 % 0.0 % Expected volatility 60.0 % 55.5 % Expected term (in years) 6.1 6.1 ESPP Nine Months Ended September 30, 2017 (1) 2016 Weighted average grant date fair value (per share) N/A $ 26.90 Risk-free interest rate N/A 0.6 % Expected dividend yield N/A 0.0 % Expected volatility N/A 56.9 % Expected term (in years) N/A 1.3 (1) There were no grants made pursuant to the ESPP during the nine months ended September 30, 2017. The following table summarizes the allocation of stock-based compensation expense (in thousands): Nine Months Ended September 30, 2017 2016 Cost of sales $ 1,022 $ 776 Selling, general & administrative 8,423 6,992 Research and development 1,057 965 Total $ 10,502 $ 8,733 The total stock-based compensation expense capitalized as part of the cost of inventory was $0.3 million and $0.2 million at September 30, 2017 and December 31, 2016, respectively. | 6. Stockholders’ Equity (Deficit) Public Offerings In the first quarter of 2015, the Company completed a public offering of 603,750 shares of its common stock at a public offering price of $115.00 per share. Net cash proceeds from the public offering were approximately $64.9 million, after deducting underwriting discounts, commissions and offering expenses payable by the Company. Stock Plans In September 2006, the Company adopted the Company’s 2006 Stock Incentive Plan (the “2006 Plan”) under which, as amended, 268,560 shares of common stock were reserved for issuance to employees, non-employee In October 2013, the Company’s board of directors approved the 2013 Plan. The 2013 Plan became effective immediately prior to the completion of the initial public offering. An initial 480,900 shares of common stock were reserved for issuance under the 2013 Plan. Under the 2013 Plan, the Company may grant stock options, stock appreciation rights, restricted stock and restricted stock units to individuals who are then employees, officers, directors or consultants of the Company. The shares available for issuance under the 2013 Plan were increased by 124,382 shares and 121,018 shares on January 1, 2017 and 2016, respectively, in accordance with an “evergreen” provision under the 2013 Plan. As of December 31, 2016, 56,228 shares are available for future issuance under the 2013 Plan, and options to purchase 822,838 shares have been granted and are outstanding under the 2006 Plan and 2013 Plan. Common Stock Options The maximum term of stock options granted under the 2006 Plan and 2013 Plan is ten years. The options generally vest 25% on the first anniversary of the original vesting date, with the balance vesting monthly over the remaining three years. The following table summarizes stock option activities for the 2006 Plan and 2013 Plan: Total Options Weighted- Average Exercise Price Per Share Weighted- Average Remaining Life (in years) Aggregate Intrinsic Value (in Outstanding at December 31, 2014 501,106 $ 102.04 8.62 $ 23,534 Granted 117,557 $ 120.06 Exercised (24,355 ) $ 13.82 $ 2,540 Canceled/forfeited/expired (19,408 ) $ 168.63 Outstanding at December 31, 2015 574,900 $ 107.22 7.99 $ 19,158 Granted 316,671 $ 45.75 Exercised (14,876 ) $ 11.49 $ 1,049 Canceled/forfeited/expired (53,857 ) $ 126.19 Outstanding at December 31, 2016 822,838 $ 84.05 7.92 $ 1,593 Vested and expected to vest at December 31, 2016 812,862 $ 84.24 7.91 $ 1,592 Exercisable at December 31, 2016 423,810 $ 98.61 6.80 $ 1,554 Employee Stock Purchase Plan In October 2013, the Company adopted the ESPP, which enables eligible employees to purchase shares of the Company’s common stock using their after tax payroll deductions, subject to certain conditions. The ESPP initially authorized the issuance of 55,600 shares of common stock pursuant to purchase rights granted to employees. The number of shares of common stock reserved for issuance increases on January 1 of each calendar year, from January 1, 2014 through January 1, 2023, by the lesser of (a) one percent (1%) of the number of shares issued and outstanding on the immediately preceding December 31, or (b) such lesser number of shares as determined by the Administrator. On January 1, 2017 and 2016, the number of shares of common stock reserved for issuance under the ESPP was automatically increased by 31,095 shares and 30,254 shares, respectively. The ESPP is intended to qualify as an “employee stock purchase plan” within the meaning of Section 423 of the Code. In the years ended December 31, 2016 and 2015, 69,233 shares and 30,218 shares of our common stock, respectively, were purchased under the ESPP. As of December 31, 2016, 7,846 shares remain available for issuance under the ESPP. Eligible employees may contribute, normally through payroll deductions, up to 15% of their earnings for the purchase of common stock under the ESPP. The purchase price of common stock under the ESPP will be the lesser of: (a) 85% of the fair market value of a share of the Company’s common stock on the first date of an offering or (b) 85% of the fair market value of a share of the Company’s common stock on the date of purchase. Generally, the ESPP consists of a two-year six-month Stock-Based Compensation. The compensation cost that has been included in the statement of operations for all stock-based compensation arrangements was as follows (in thousands): Year Ended December 31, 2016 2015 2014 Cost of sales $ 1,016 $ 1,162 $ 1,317 Selling, general & administrative 9,360 10,517 11,886 Research and development 1,284 1,417 1,792 Total $ 11,660 $ 13,096 $ 14,995 The total stock-based compensation capitalized as part of the cost of the Company’s inventory was $0.2 million and $0.1 million at December 31, 2016 and 2015, respectively. For the years ended December 31, 2016, 2015 and 2014, the expense for stock option grants to non-employees At December 31, 2016, the total unamortized stock-based compensation expense of approximately $14.0 million will be recognized over the remaining vesting term of approximately 1.9 years. The assumptions used in the Black-Scholes option-pricing model are as follows: Stock Option Year Ended December 31, 2016 2015 2014 Weighted average grant date fair value (per share) $ 24.30 $ 71.50 $ 142.90 Risk-free interest rate 1.7 % 1.7 % 1.8 % Expected dividend yield 0.0 % 0.0 % 0.0 % Expected volatility 57.5 % 64.7 % 76.3 % Expected term (in years) 5.8 6.0 5.9 ESPP Year Ended December 31, 2016 2015 Weighted average grant date fair value (per share) $ 17.80 $ 45.50 Risk-free interest rate 0.7 % 0.5 % Expected dividend yield 0.0 % 0.0 % Expected volatility 62.7 % 61.2 % Expected term (in years) 1.3 1.3 Risk-free Interest Rate zero-coupon Expected Dividend Yield Expected Volatility Expected Term two-year The Company is also required to estimate forfeitures at the time of grant, and revise those estimates in subsequent periods if actual forfeitures differ from its estimates. Historical data was used to estimate pre-vesting Common Stock Reserved for Future Issuance The following shares of common stock are reserved for future issuance at December 31, 2016 (in thousands): Common stock warrants outstanding 99 Stock options issued and outstanding 822 Authorized for future option grants 56 Employee stock purchase plan 7 984 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended | |
Sep. 30, 2017 | Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Commitments and Contingencies | 8. Commitments and Contingencies From time to time, the Company may be subject to legal proceedings, regulatory encounters or other matters arising in the ordinary course of business, including actions with respect to intellectual property, employment, product liability, and contractual matters. In connection with these matters, the Company assesses, on a regular basis, the probability and range of possible loss based on the developments in these matters. A liability is recorded in the financial statements if it is determined that it is probable that a loss has been incurred, and that the amount or range of the loss can be reasonably estimated. Because of the uncertainties related to the occurrence, amount, and range of loss on any pending actions, the Company is currently unable to predict their ultimate outcome, and, with respect to any pending litigation or claim where no liability has been accrued, to make a meaningful estimate of the reasonably possible loss or range of loss that could result from an unfavorable outcome. At September 30, 2017 and December 31, 2016, there were no legal proceedings, regulatory encounters or other matters for which the negative outcome was considered probable or for which the amount or range of loss was estimable. | 10. Commitments and Contingencies From time to time, the Company may be subject to legal proceedings or regulatory encounters or other matters arising in the ordinary course of business, including actions with respect to intellectual property, employment, product liability, and contractual matters. In connection with these matters, the Company assesses, on a regular basis, the probability and range of possible loss based on the developments in these matters. A liability is recorded in the financial statements if it is believed to be probable that a loss has been incurred and the amount of the loss can be reasonably estimated. Because of the uncertainties related to the occurrence, amount, and range of loss on any pending actions, the Company is currently unable to predict their ultimate outcome, and, with respect to any pending litigation or claim where no liability has been accrued, to make a meaningful estimate of the reasonably possible loss or range of loss that could result from an unfavorable outcome. At December 31, 2016 and 2015, there were no material matters for which a negative outcome was considered probable or estimable. Operating leases Under a noncancelable operating lease agreement, as amended (“Existing Operating Lease”), the Company leases manufacturing, laboratory and office space in San Diego, California. The lease term extends through May 2022. As a lease incentive from the landlord under the Existing Operating Lease, the Company received a tenant improvement allowance (“TI Allowance”) of approximately $0.9 million and $1.6 million, for the years ended December 31, 2015 and 2014, respectively, for nonstructural improvements to the buildings. The Company recorded the incentives as increases to both property and equipment and deferred rent, which are amortized on a straight-line basis over the life of the lease. In connection with the Existing Operating Lease, the Company has a $0.5 million unsecured standby letter of credit arrangement with a bank under which the landlord of the building is the beneficiary. The expiration of the standby letter of credit is July 14, 2019. On June 30, 2016, the Company entered into a lease agreement for general office and manufacturing space located on Barnes Canyon Road in San Diego, California (the “Barnes Canyon Lease”). The Barnes Canyon Lease is scheduled to expire in November 2023. The Company will also have a one-time The Barnes Canyon Lease allows for a TI Allowance of up to approximately $3.4 million to be applied to non-structural The monthly rent, except TI Rent mentioned above, increases by a fixed percentage each year on the anniversary of the respective rent commencement date of the Existing Operating Lease and Barnes Canyon Lease. The difference between the straight-line expense over the term of the lease and actual amounts paid are recorded as deferred rent. Deferred rent arising from rent escalation provisions and lease incentives totaled $3.7 million at both December 31, 2016 and 2015, respectively. Rent expense for the three years ended December 31, 2016, 2015 and 2014, was $3.1 million, $2.6 million, and $2.1 million, respectively. Future minimum payments under the aforementioned noncancelable operating leases for each of the five succeeding years following December 31, 2016 are as follows (in thousands): 2017 $ 3,198 2018 3,630 2019 1,899 2020 643 2021 662 Thereafter 1,323 $ 11,355 Not included in the table above is the Barnes Canyon Lease TI Rent. No TI Rent was due as of December 31, 2016. Assuming the full TI Allowance is drawn on April 1, 2017, such TI Rent would be $0.5 million for the year ended December 31, 2017, $0.7 million for each of the years ended December 31, 2018 through 2021, and $1.3 million for the years ended December 31, 2022 and thereafter. |
Subsequent Event
Subsequent Event | 9 Months Ended | |
Sep. 30, 2017 | Dec. 31, 2016 | |
Subsequent Events [Abstract] | ||
Subsequent Event | 9. Subsequent Events On October 9, 2017, the Company effected a 1-for-10 per-share On October 17, 2017, the Company completed a registered public offering of 4,630,000 shares of its common stock, Series A warrants to purchase up to 4,630,000 shares of its common stock and Series B warrants to purchase up to 4,630,000 shares of its common stock, at a public offering price of $3.50 per share and accompanying warrants. The gross proceeds to the Company from the offering were approximately $16.2 million, before deducting underwriting discounts and commissions and other offering expenses payable by the Company. The Series A warrants have an exercise price of $3.50 per share, are immediately exercisable, and will expire on the 5-year 6-month | 12. Subsequent Event On March 7, 2017, the Company entered into the Fourth Amendment, which includes a limited waiver of any event of default that could have occurred due to the inclusion of the explanatory paragraph that describes conditions that raise substantial doubt about our ability to continue as a going concern in the report of the Company’s independent registered public accounting firm contained in the accompanying financial statements, in consideration for which we agreed to: (i) complete an equity financing in which the Company’s gross proceeds from the sale of equity securities is at least $30.0 million, no later than January 15, 2018, (ii) issue Capital Royalty Partners warrants to purchase an aggregate of 193,788 shares of our common stock at an exercise price equal to $23.50 per share, the closing price of our common stock on the NASDAQ Global Market on the date of the Fourth Amendment, (iii) increase our minimum cash balance requirement under the Term Loan Agreement from $2.0 million to $10.0 million, (iv) provide Capital Royalty Partners the same information we make available to our board of directors, subject to limited exceptions, and (v) not incur additional third party indebtedness secured solely by accounts receivable, inventory and cash. In addition, we agreed to increase the Back End Financing Fee to 5.0% of the entire aggregate principal amount of borrowings outstanding, including total PIK Loans issued, under the Term Loan Agreement, which is $81.1 million as of December 31, 2016. The Back End Financing Fee is payable at maturity of our loans and on the principal amount of any loans for which we make an optional prepayment, and may be payable in connection with asset sales not permitted under the Term Loan Agreement or in connection with a change of control. (See Note 5 “Term Loan Agreement”) |
Financial Statement Information
Financial Statement Information | 9 Months Ended |
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Financial Statement Information | 3. Financial Statement Information Short-term investments The Company invests in investment securities, principally debt instruments of financial institutions and corporations with strong credit ratings. The following represents a summary of the estimated fair value of short-term investments at December 31, 2016 and 2015 (in thousands): At December 31, 2016 Maturity (in years) Amortized Cost Unrealized Gain Unrealized Loss Estimated Fair Value Available-for-sale Commercial paper Less $ 8,483 $ 1 $ (2 ) $ 8,482 Trading securities: Mutual funds held for nonqualified deferred compensation plan participants $ 354 $ 26 $ (2 ) $ 378 Total $ 8,837 $ 27 $ (4 ) $ 8,860 At December 31, 2015 Maturity (in years) Amortized Cost Unrealized Gain Unrealized Loss Estimated Fair Value Available-for-sale Commercial paper Less $ 21,712 $ 23 $ — $ 21,735 US Treasuries Less 2,035 — (1 ) 2,034 Government-sponsored enterprise securities Less 4,029 — (2 ) 4,027 $ 27,776 $ 23 $ (3 ) $ 27,796 Trading securities: Mutual funds held for nonqualified deferred compensation plan participants $ 224 $ 1 $ (3 ) $ 222 Total $ 28,000 $ 24 $ (6 ) $ 28,018 Accounts Receivable Accounts receivable consisted of the following at (in thousands): December 31, 2016 2015 Accounts receivable $ 12,112 $ 14,583 Less allowance for doubtful accounts, and product returns (940 ) (528 ) Total $ 11,172 $ 14,055 The following table provides a reconciliation of the change in estimated allowance for doubtful accounts, and product returns for the years ended December 31, 2016, 2015 and 2014 (in thousands): Allowance doubtful Balance at December 31, 2013 $ 218 Provision for doubtful accounts and return reserves 188 Write-offs and adjustments, net of recoveries (153 ) Balance at December 31, 2014 $ 253 Provision for doubtful accounts and return reserves 70 Write-offs and adjustments, net of recoveries (102 ) Balance at December 31, 2015 $ 221 Provision for doubtful accounts and return reserves 632 Write-offs and adjustments, net of recoveries (118 ) Balance at December 31, 2016 $ 735 Inventory Inventory consisted of the following at (in thousands): December 31, 2016 2015 Raw materials $ 9,375 $ 10,606 Work in process 4,395 3,394 Finished goods 7,425 3,543 Total $ 21,195 $ 17,543 Property and Equipment Property and equipment consisted of the following at (in thousands): December 31, 2016 2015 Leasehold improvements $ 8,851 $ 7,781 Computer equipment and software 7,844 6,599 Office furniture and equipment 4,185 3,898 Manufacturing and scientific equipment 16,785 12,793 37,665 31,071 Less accumulated depreciation and amortization (19,256 ) (15,545 ) Total $ 18,409 $ 15,526 Depreciation and amortization expense related to property and equipment amounted to $5.2 million, $4.5 million, and $4.1 million for the years ended December 31, 2016, 2015 and 2014, respectively. Intangible Assets Subject to Amortization Intangible assets subject to amortization consist of patents purchased or licensed that are related to the Company’s commercialized products. The following represents the capitalized patents at December 31, 2016 and 2015 (in thousands): December 31, 2016 2015 Gross amount $ 3,247 $ 3,247 Accumulated amortization (1,463 ) (1,137 ) Total $ 1,784 $ 2,110 Weighted average remaining amortization period (in months) 66 78 Amortization expense related to intangible assets subject to amortization amounted to $0.3 million for each of the years ended December 31, 2016, 2015 and 2014. The amortization expense is recorded in cost of sales in the statement of operations. The estimated annual amortization is $0.3 million for 2017 and periods thereafter. |
Income Taxes
Income Taxes | 9 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 7. Income Taxes The provision (benefit) for income taxes reconciles to the amount computed by applying the federal statutory rate to income before taxes as follows (in thousands): Year Ended December 31, 2016 2015 2014 Income tax benefit at federal statutory rate $ (28,362 ) $ (24,616 ) $ (27,065 ) State income tax, net of federal benefit (2,393 ) (2,285 ) (3,912 ) Research and development credits (720 ) (1,796 ) (646 ) Uncertain tax position — 3,154 — Stock-based compensation 1,686 1,904 1,973 Other 456 550 355 Removal of net operating losses and research and development credits — 8,344 — Change in valuation allowance 29,318 14,755 29,366 Income tax expense (recovery) $ (15 ) $ 10 $ 71 Significant components of the Company’s net deferred income tax assets at December 31, 2016 and 2015 are shown below (in thousands). A valuation allowance has been recorded to offset the net deferred tax asset as of December 31, 2016 and 2015, as the realization of such assets does not meet the more-likely-than-not December 31, 2016 2015 Deferred tax assets: Net operating loss (NOL) carryforwards $ 100,251 $ 79,233 Research and development tax credits carryforwards 2,543 1,832 Capitalized research and development expenses 16,673 13,296 Deferred rent 537 168 Accrued compensation 11,332 9,309 Other 5,931 4,104 Total deferred tax assets 137,267 107,942 Less valuation allowance (137,267 ) (107,942 ) Net deferred tax assets $ — $ — The California NOL carry forwards will expire as follows (in thousands): Year ended December 31, 2016 $ 624 2017 $ 2,052 Thereafter $ 167,828 As of December 31, 2016, the Company has accumulated federal and state NOL carryforwards of approximately $283.5 million and $269.7 million, respectively, not considering the annual limitation of Section 382 of the Internal Revenue Code of 1986, as amended (the “Code”) discussed below. The federal and state tax loss carryforwards begin to expire in 2026 and 2016, respectively, unless previously utilized. The Company also has federal and California research credit carryforwards of approximately $4.1 million and $4.6 million, respectively. The federal research credit carryforwards will begin expiring in 2028 unless previously utilized. The California research credit will carry forward indefinitely. Approximately $1.8 million of the NOL carryforwards relates to excess tax deductions for stock compensation, the income tax benefit of which will be recorded as additional paid-in capital if and when realized. Utilization of the NOLs and R&D credit carryforwards are subject to annual limitations due to ownership change limitations that have occurred or that could occur in the future, as required by Section 382 of the Code, as well as similar state and foreign provisions. These ownership changes may limit the amount of NOLs and R&D credit carryforwards that can be utilized annually to offset future taxable income and tax, respectively. In general, an “ownership change,” as defined by Section 382 of the Code results from a transaction or series of transactions over a three-year period resulting in an ownership change of more than 50 percentage points of the outstanding stock of a company by certain stockholders. Although the Company determined that it is more likely than not that an ownership change had occurred in March 2015, the Company has not completed a formal update of its Section 382 analysis subsequent to December 31, 2013. Until this analysis has been updated, the Company has removed deferred tax assets for NOLs of $16.0 million and research and development credits of $2.9 million from its deferred tax asset schedule and has recorded a corresponding decrease to its valuation allowance. The amount presented as a deferred tax asset with respect to losses and credits after the removal of potentially limited amounts reflects the estimated asset value using the Section 382 limitation criteria as of the date of the March 2015 public offering of 6,037,500 shares of common stock, given that it is possible that this transaction may have triggered the limitation. When this analysis is finalized, the Company will reassess the amount of NOLs and credits subject to limitation under Section 382. Due to the existence of the valuation allowance, future changes in the deferred tax assets related to these tax attributes will not impact the Company’s effective tax rate. The evaluation of uncertainty in a tax position is a two-step more-likely-than-not more-likely-than-not The following table summarizes the activity related to the Company’s gross unrecognized tax benefits at the beginning and end of the years ended December 31, 2016, 2015 and 2014 (in thousands): Year Ended December 31, 2016 2015 2014 Gross unrecognized tax benefits at the beginning of the year $ 7,594 $ 3,539 $ 1,912 Increases related to current year positions 580 474 476 Increases (decreases) related to prior year positions (7 ) 3,581 1,151 Expiration of unrecognized tax benefits — — — Gross unrecognized tax benefits at the end of the year $ 8,167 $ 7,594 $ 3,539 As of December 31, 2016, the Company has $5.9 million of unrecognized tax benefits that, if recognized and realized would impact the effective tax rate. The Company’s practice is to recognize interest and penalties related to income tax matters in income tax expense. The Company had no accrual for interest and penalties on the Company’s balance sheets and has not recognized interest and penalties in the statements of operations for the years ended December 31, 2016 and 2015. The Company does not expect any significant increases or decreases to its unrecognized tax benefits within the next 12 months. The Company is subject to taxation in the United States and state jurisdictions. The Company’s tax years from 2006 (inception) are subject to examination by the United States and state authorities due to the carry forward of unutilized NOLs and research and development credits. |
Collaborations
Collaborations | 9 Months Ended |
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Collaborations | 8. Collaborations DexCom Development and Commercialization Agreement In February 2012, the Company entered into a Development and Commercialization Agreement (the “DexCom Agreement”) with DexCom, Inc. (“DexCom”) for the purpose of collaborating on the development and commercialization of an integrated system which incorporates the t:slim Insulin Delivery System with DexCom’s proprietary CGM system. Under the DexCom Agreement, the Company paid DexCom $1.0 million at the commencement of the collaboration in 2012, $1.0 million in 2014 upon the achievement of t:slim G4 pre-market Additionally, upon commercialization of the t:slim G4 Pump, and as compensation for the non-exclusive In September 2015, the Company entered into an amendment to the DexCom Agreement (the “Amendment”). Pursuant to the Amendment, in lieu of the $100 royalty payment for each integrated system sold, the Company agreed to commit $100 of each t:slim G4 integrated system sold to incremental marketing activities associated with t:slim G4 integrated systems that are in addition to a level of ordinary course marketing activities or marketing activities to support other Company and DexCom jointly funded development projects. The committed marketing fund is recorded as an increase to cost of sales and current liability in the period that the related t:slim G4 Pump sale is recorded. The Company recorded such marketing fund commitment of $0.7 million and $0.4 million in the years ended December 31, 2016 and 2015, respectively. The Company utilized the committed marketing funds of $0.4 million and zero in the years ended December 31, 2016 and 2015, respectively. As of December 31, 2016 and 2015, the Company had a marketing fund liability of $0.7 million and $0.4 million, respectively, recorded in other current liabilities on the accompanying balance sheet. JDRF Collaboration In January 2013, the Company entered into a Research, Development and Commercialization Agreement (“JDRF Agreement”) with JDRF to develop the t:dual Infusion System, a first-of-its-kind, In February 2016, the Company and JDRF entered into a termination agreement (“JDRF Termination Agreement”), where both parties mutually terminated the JDRF Agreement. As of December 31, 2015, milestone payment achievements totaled $0.7 million, and research and development costs were offset cumulatively by $0.5 million. Under the terms of the JDRF Termination Agreement, the Company agreed to repay JDRF $0.7 million, which is equal to the amount of milestone payments received by the Company to date. The Company accrued for the repayment in other current liabilities on the accompanying balance sheet as of December 31, 2015 and repaid such amount during the first quarter of 2016. |
Employee Benefits
Employee Benefits | 9 Months Ended |
Dec. 31, 2016 | |
Postemployment Benefits [Abstract] | |
Employee Benefits | 9. Employee Benefits Employee 401(k) Plan The Company has a defined contribution 401(k) plan for employees who are at least 18 years of age. Employees are eligible to participate in the plan beginning on the first day of the calendar quarter following their date of hire. Under the terms of the plan, employees may make voluntary contributions as a percent of compensation. The Company does not provide a matching contribution program. Nonqualified Deferred Compensation Plan On June 16, 2014, the Company’s Board of Directors adopted and approved the Tandem Diabetes Care, Inc. Deferred Compensation Plan (the “Plan”). The Plan is a nonqualified deferred compensation program sponsored by the Company to provide its non-employee directors and certain of its management employees designated by the Board (or a committee appointed by the Board to administer the Plan) the opportunity to defer compensation under the Plan. The effective date for the Plan for the first year was July 1, 2014, and thereafter the plan year will be from January 1 to December 31. There is no limit to the amount that a participant may defer under the Plan whether in a particular plan year or in aggregate. At the discretion of the Board (or a committee appointed by the Board to administer the Plan), the Company may make additional contributions to be credited to the account of any or all participants in the Plan. All contributions by the participant, and any contributions that may be made by the Company, will be immediately fully vested. As of December 31, 2016, the Company has not made any contributions. Under the terms of the Plan, the Company has established a Rabbi Trust for the purpose of reserving any benefits that may become payable under the Plan. Distributions from the Plan will be governed by the Code and the terms of the Plan. Company assets designated to pay benefits under the plan are held by a Rabbi Trust and are subject to the general creditors of the Company. The amounts deferred are invested in assets at the direction of the employee. The assets and liabilities of the Rabbi Trust are recorded at fair value and are accounted for as assets and liabilities of the Company. As of December 31, 2016 and 2015, the Company held deferred compensation plan assets of $378,000 and $222,000 in short-term investments on its balance sheets. The assets were invested in mutual funds. The fair market value of the assets held in the Deferred Compensation Plan was based on unadjusted quoted prices in active markets. The Company carried a corresponding deferred compensation liability in other long-term liabilities on its balance sheet of $378,000 and $222,000 as of December 31, 2016 and December 31, 2015, respectively. |
Selected Quarterly Financial Da
Selected Quarterly Financial Data (Unaudited) | 9 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Selected Quarterly Financial Data (Unaudited) | 11. Selected Quarterly Financial Data (Unaudited) Quarterly financial information for fiscal 2016 and 2015 is presented in the following table, in thousands, except per share data: For the Quarter Ending March 31 June 30 September 30 December 31 2016: Revenue $ 20,058 $ 22,985 $ 12,293 $ 28,912 Gross profit $ 6,927 $ 8,176 $ (1,577 ) $ 10,065 Operating expenses $ 26,166 $ 25,229 $ 26,837 $ 23,411 Operating loss $ (19,239 ) $ (17,053 ) $ (28,414 ) $ (13,346 ) Net loss $ (20,485 ) $ (18,326 ) $ (29,815 ) $ (14,822 ) Basic and diluted net loss per share (1) $ (6.80 ) $ (6.00 ) $ (9.70 ) $ (4.80 ) 2015: Revenue $ 12,308 $ 15,706 $ 15,716 $ 29,120 Gross profit $ 2,808 $ 4,801 $ 5,513 $ 13,458 Operating expenses $ 23,218 $ 23,472 $ 24,216 $ 24,679 Operating loss $ (20,410 ) $ (18,671 ) $ (18,703 ) $ (11,221 ) Net loss $ (21,208 ) $ (19,533 ) $ (19,585 ) $ (12,093 ) Basic and diluted net loss per share (1) $ (8.30 ) $ (6.50 ) $ (6.50 ) $ (4.00 ) 2014: Revenue $ 8,066 $ 10,254 $ 13,513 $ 17,889 Gross profit $ 867 $ 3,448 $ 4,396 $ 6,537 Operating expenses $ 21,704 $ 21,766 $ 23,403 $ 24,039 Operating loss $ (20,837 ) $ (18,318 ) $ (19,007 ) $ (17,502 ) Net loss $ (21,961 ) $ (19,197 ) $ (19,901 ) $ (18,465 ) Basic and diluted net loss per share (1) $ (9.60 ) $ (8.30 ) $ (8.50 ) $ (7.80 ) (1) Net loss per share is computed independently for each of the quarters presented. Therefore, the sum of the quarterly per-share |
Organization and Basis of Pre22
Organization and Basis of Presentation (Policies) | 9 Months Ended | |
Sep. 30, 2017 | Dec. 31, 2016 | |
Accounting Policies [Abstract] | ||
The Company | The Company Tandem Diabetes Care, Inc. is a medical device company focused on the design, development and commercialization of products for people with insulin-dependent diabetes. The Company is incorporated in the state of Delaware. Unless the context requires otherwise, the terms the “Company” or “Tandem” refer to Tandem Diabetes Care, Inc. The Company manufactures and sells insulin pump products in the United States that are designed to address large and differentiated needs of the insulin-dependent diabetes market. The Company’s pump products currently include: • the t:slim X2 Insulin Delivery System, or t:slim X2, the next-generation flagship product that is updatable and designed to display Dexcom G5 continuous glucose monitoring, or CGM, sensor information directly on the pump Home Screen; and • the t:flex Insulin Delivery System, or t:flex, for people with greater insulin needs. The Company began commercial sales of its first product, t:slim, in August 2012. During 2015, the Company commenced commercial sales of two additional insulin pumps: t:flex in May 2015 and t:slim G4 in September 2015. In October 2016, the Company commenced commercial sales of t:slim X2 and discontinued new sales of t:slim. In August 2017, the Company commenced commercial sales of t:slim X2 with Dexcom G5 Mobile CGM integration, or t:slim X2 with G5, and discontinued new sales of t:slim G4. The Company will continue to provide ongoing service and support to existing t:slim and t:slim G4 customers. In July 2016, the Company received clearance from the U.S. Food and Drug Administration (“FDA”) to begin offering the Tandem Device Updater, a Mac and PC-compatible In July 2016, the Company also announced and launched a Technology Upgrade Program that provided eligible t:slim and t:slim G4 customers a path to obtain t:slim X2, or, as of August 2017, t:slim X2 with G5. Participating customers had the right to exchange their original t:slim and t:slim G4 for a t:slim X2 or t:slim X2 with G5, under a variable pricing structure. The Technology Upgrade Program expired on September 30, 2017. In September 2017, the Company commenced commercial sales of products using the t:lock TM Luer-lok Luer-lok Effective December 31, 2016, the Company adopted FASB Accounting Standard Codification (“ASC”) Topic 205-40, The Company has incurred operating losses since its inception and, as reflected in the accompanying financial statements, the Company has an accumulated deficit of $466.2 million as of September 30, 2017, which reflects a net loss of $61.6 million for the nine months ended September 30, 2017. The Company had cash and cash equivalents and short-term investments of $22.5 million at September 30, 2017, including $10.0 million of restricted cash as required by the Company’s term loan agreement (as amended, the “Term Loan Agreement”) with Capital Royalty Partners II, L.P. and its affiliate funds (“Capital Royalty Partners”). The Company used $54.5 million in cash from operations in the nine months ended September 30, 2017. The Company concluded that, at the date the financial statements were issued, it did not have sufficient cash to fund its operations for the next twelve months without additional financing and, therefore, there was substantial doubt about its ability to continue as a going concern within one year after the date the financial statements were issued. On October 9, 2017, the Company effected a 1-for-10 per-share The Company completed a registered public offering on October 17, 2017, or the October Financing, which resulted in gross proceeds to the Company of $16.2 million, before deducting underwriting discounts and commissions and other offering expenses (see Note 9 “Subsequent Event”). As part of the October Financing, the Company issued 4,630,000 shares of common stock, Series A warrants to purchase 4,630,000 shares of common stock and Series B warrants to purchase 4,630,000 shares of common stock, at a public offering price of $3.50 per share and accompanying warrants. The Series A warrants have an exercise price of $3.50 per share, are immediately exercisable, and will expire on the 5-year anniversary of the date of issuance. The Series B warrants have an exercise price of $3.50 per share, are immediately exercisable, and will expire on the 6-month The Company believes it will be necessary to raise additional funding. The Company intends to seek additional capital from public or private offerings of its capital stock or it may elect to borrow additional amounts under new debt financing arrangements or from other sources. If the Company issues equity or convertible debt securities to raise additional funding, its existing stockholders may experience dilution, it may incur significant financing costs, and the new equity or convertible debt securities may have rights, preferences and privileges senior to those of its existing stockholders. If the Company issues debt securities to raise additional funding, it would incur additional debt service obligations, it could become subject to additional restrictions limiting its ability to operate its business, and it may be required to further encumber its assets. The Company’s ability to continue as a going concern, meet its minimum liquidity requirements, satisfy the covenants under the Term Loan Agreement, and execute its business strategy is dependent on its ability to raise significant additional capital, of which there can be no assurance. If the Company cannot generate sufficient revenues from the sale of its products or secure additional financing on acceptable terms, it may be forced to significantly alter its business strategy, substantially curtail or modify its current operations, or cease operations altogether. | The Company Tandem Diabetes Care, Inc. is a medical device company focused on the design, development and commercialization of products for people with insulin-dependent diabetes. The Company is incorporated in the state of Delaware. Unless the context requires otherwise, the terms the “Company” or “Tandem” refer to Tandem Diabetes Care, Inc. The Company manufactures and sells insulin pump products in the United States that are designed to address large and differentiated needs of the insulin-dependent diabetes market. During 2016, the Company’s pump products included: • the t:slim Insulin Delivery System, or t:slim, • the t:flex Insulin Delivery System, or t:flex, • the t:slim G4 Insulin Delivery System, or t:slim G4, and • the t:slim X2 Insulin Delivery System, or t:slim X2. The Company began commercial sales of its first product, t:slim, in August 2012. During 2015, the Company commenced commercial sales of two additional insulin pumps: t:flex in May 2015 and t:slim G4 in September 2015. In July 2016, the Company received clearance from the U.S. Food and Drug Administration (“FDA”) to begin offering the Tandem Device Updater, a Mac and PC-compatible In July 2016, the Company announced and launched a Technology Upgrade Program that provides eligible t:slim and t:slim G4 customers a path to obtain t:slim X2. Participating customers have the right to exchange their original t:slim and t:slim G4 for a t:slim X2, under a variable pricing structure. The Technology Upgrade Program expires on September 30, 2017. In October 2016, the Company began shipping t:slim X2. As a result, the Company discontinued new shipments of t:slim, though the Company will continue to provide ongoing service and support to existing t:slim customers. For the year ended December 31, 2016, the Company has adopted FASB Accounting Standard Codification ASC Topic 205-40, On October 9, 2017, the Company effected a 1-for-10 per-share The Company has incurred operating losses since its inception and, as reflected in the accompanying financial statements, the Company has an accumulated deficit of $404.6 million as of December 31, 2016, which includes a net loss of $83.4 million for the year ended December 31, 2016. Additionally, the Company used $61.2 million in cash for operations in the year ended December 31, 2016, which exceeded cash and cash equivalents and short-term investments of $53.5 million at December 31, 2016. The Company concluded that, at the date its financial statements for the year ended December 31, 2016 were issued, it did not have sufficient cash to fund its operations through December 31, 2017 without additional financing and, therefore, there was substantial doubt about its ability to continue as a going concern within one year after the date the financial statements were issued. As a result, the audit report contained in the accompanying financial statements includes an explanatory paragraph that describes conditions that raise substantial doubt about the Company’s ability to continue as a going concern. This explanatory paragraph could constitute a potential event of default under the Company’s existing term loan agreement (as amended by Consent and Amendment Agreement, dated June 20, 2014, Omnibus Amendment Agreement No. 2, dated February 23, 2015, Amendment No. 3 to Term Loan Agreement, dated January 8, 2016, and Waiver and Amendment No. 4 to Term Loan Agreement, dated March 7, 2017, the “Term Loan Agreement”) with Capital Royalty Partners II L.P. and its affiliate funds (“Capital Royalty Partners”). Accordingly, on March 7, 2017, the Company entered into an amendment to the terms of the Term Loan Agreement (the “Fourth Amendment”) that included a limited waiver of the potential event of default that could have occurred due to the explanatory paragraph included in the audit report. (See Note 5 “Term Loan Agreement” and Note 12 “Subsequent Event.”) The financial statements included in this prospectus have been prepared on a basis that assumes that the Company will continue as a going concern, and do not include any adjustments that may result from the outcome of this uncertainty. This basis of accounting contemplates the recovery of the Company’s assets and the satisfaction of the Company’s liabilities and commitments in the normal course of business and does not include any adjustments to reflect the possible future effects of the recoverability and classification of recorded asset amounts or amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. The Company believes that it will be necessary to raise additional funding in the form of an equity financing from the sale of common stock. The Company may in the future seek additional capital from public or private offerings of its capital stock or it may elect to borrow additional amounts under new credit lines or from other sources. If the Company issues equity or debt securities to raise additional funds, its existing stockholders may experience dilution, it may incur significant financing costs, and the new equity or debt securities may have rights, preferences and privileges senior to those of its existing stockholders. The Company’s ability to continue as a going concern, meet its minimum liquidity requirements in the future or satisfy the other covenants under the Term Loan Agreement is dependent on its ability to raise significant additional capital, of which there can be no assurance. If the Company cannot generate sufficient revenues from the sale of its products or secure additional financing on acceptable terms, it may be forced to significantly alter its business strategy, substantially curtail its current operations, or cease operations altogether. |
Basis of Presentation | Basis of Presentation The Company has prepared the accompanying unaudited condensed financial statements in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information. Accordingly, they do not include all of the information and disclosures required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments which are of a normal and recurring nature, considered necessary for a fair presentation of the financial information contained herein, have been included. Interim financial results are not necessarily indicative of results anticipated for the full year or any other period(s). These unaudited condensed financial statements should be read in conjunction with the Company’s audited financial statements and accompanying footnotes included in the Company’s Annual Report on Form 10-K | Basis of Presentation The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The accompanying financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the Company’s realization of assets and satisfaction of liabilities in the normal course of business. The financial statements do not include any adjustments relating to the recoverability and classification of assets and liabilities that might be necessary should the Company be unable to continue as a going concern. The Company’s continuation as a going concern is dependent upon its ability to raise additional equity or refinance its existing debt and ultimately, to attain profitability. There is no assurance that the Company will be successful in raising additional funds or that, if it does raise additional funds, that it will be able to attain profitability or even continue in business. |
Use of Estimates | Use of Estimates The preparation of the financial statements in conformity with U.S. GAAP requires management to make informed estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and the disclosure of contingent assets and liabilities in the Company’s financial statements and accompanying footnotes as of the date of the financial statements. Actual results could materially differ from those estimates and assumptions. | Use of Estimates The preparation of the financial statements in conformity with GAAP requires management to make informed estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and the disclosure of contingent assets and liabilities in the Company’s financial statements and accompanying notes as of the date of the financial statements. Actual results could differ materially from those estimates and assumptions. |
Restricted Cash | Restricted Cash The Company recorded $10.0 million and $2.0 million of restricted cash as of September 30, 2017 and December 31, 2016, respectively, for the minimum cash balance requirement in connection with the Term Loan Agreement (see Note 6, “Term Loan Agreement”). | Restricted Cash Restricted cash as of December 31, 2016 and 2015 was comprised of a $2.0 million minimum cash balance requirement in connection with the Term Loan Agreement (see Note 5, “Term Loan Agreement”). |
Accounts Receivable | Accounts Receivable The Company grants credit to various customers in the normal course of business. The Company maintains an allowance for doubtful accounts for potential credit losses. Provisions are made based on historical experience, assessment of specific risk, specific review of outstanding invoices, and various additional assumptions and estimates that are believed to be reasonable under the circumstances. Uncollectible accounts are written off against the allowance after appropriate collection efforts have been exhausted and when it is deemed that a balance is uncollectible. | Accounts Receivable The Company grants credit to various customers in the normal course of business. The Company maintains an allowance for doubtful accounts for potential credit losses. Provisions are made based on historical experience, assessment of specific risk, specific review of outstanding invoices or various assumptions and estimates that are believed to be reasonable under the circumstances. Uncollectible accounts are written off against the allowance after appropriate collection efforts have been exhausted and when it is deemed that a balance is uncollectible. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable, accrued expenses, and employee-related liabilities are reasonable estimates of their fair values because of the short-term nature of these assets and liabilities. Short-term investments are carried at fair value. Based on the borrowing rates currently available for loans with similar terms, the Company believes that the fair value of its long-term notes payable approximates its carrying value. Certain trade-in | Fair Value of Financial Instruments The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable, accrued expense, and employee-related liabilities are reasonable estimates of their fair values because of the short-term nature of these assets and liabilities. Short-term investments and foreign exchange forward contracts that are not designated as hedges are carried at fair value. Based on the borrowing rates currently available for loans with similar terms, the Company believes that the fair value of its long-term notes payable approximates its carrying value. The Company offers to certain eligible customers trade-in |
Revenue Recognition | Revenue Recognition Revenue is generated primarily from sales in the United States of insulin pumps, disposable cartridges and infusion sets to individual customers and third-party distributors that resell the product to insulin-dependent diabetes customers. The Company is paid directly by customers who use the products, distributors and third-party insurance payors. Revenue is recognized when persuasive evidence of an arrangement exists, delivery has occurred and title passed, the price is fixed or determinable, and collectability is reasonably assured. Trade-In The Company launched a Technology Upgrade Program in 2016, which expired September 30, 2017. The trade-in trade-in trade-in trade-in The Company determined that trade-in trade-in trade-in trade-in trade-in The Company determined that t:slim Pump trade-in in-substance trade-in trade-in trade-in Revenue Recognition for Arrangements with Multiple Deliverables The Company considers the deliverables in its product offering as separate units of accounting and recognizes deliverables as revenue upon delivery only if (i) the deliverable has standalone value and (ii) the arrangement includes a general right of return relative to the delivered item(s) and delivery or performance of the undelivered item(s) is probable and substantially controlled by the Company. The Company allocates consideration to the separate units of accounting, unless the undelivered elements were deemed perfunctory and inconsequential. The amount of the determined guarantee fair value is allocated in full to the guarantee and the remaining allocable consideration is allocated to other separate units of accounting using the relative selling price method, in which allocation of consideration is based on vendor-specific objective evidence (“VSOE”) if available, third-party evidence (“TPE”), or if VSOE and TPE are not available, management’s best estimate of a standalone selling price (“ESP”) for the undelivered elements. The Company offers a cloud-based data management application, t:connect, which is made available to customers upon purchase of any of its insulin pumps. In July 2016, the Company received clearance from the FDA to begin offering the Tandem Device Updater, a Mac and PC-compatible when-and-if-available Product Returns The Company offers a 30-day | Revenue Recognition Revenue is generated from sales in the United States of insulin pumps, disposable cartridges and infusion sets to individual customers and third-party distributors that resell the product to insulin-dependent diabetes customers. The Company is paid directly by customers who use the products, distributors and third-party insurance payors. Revenue is recognized when persuasive evidence of an arrangement exists, delivery has occurred and title passed, the price is fixed or determinable, and collectability is reasonably assured. Trade-In The trade-in trade-in trade-in trade-in The Company has determined that trade-in trade-in trade-in, trade-in trade-in The Company has determined that t:slim Pump trade-in in-substance trade-in trade-in trade-in Revenue Recognition for Arrangements with Multiple Deliverables The Company considers the deliverables in its product offering as separate units of accounting and recognizes deliverables as revenue upon delivery only if (i) the deliverable has standalone value and (ii) if the arrangement includes a general right of return relative to the delivered item(s), delivery or performance of the undelivered item(s) is probable and substantially controlled by the Company. The Company allocates consideration to the separate units of accounting, unless the undelivered elements were deemed perfunctory and inconsequential. The amount of the determined guarantee fair value is allocated in full to the guarantee and the remaining allocable consideration is allocated to other separate units of accounting using the relative selling price method, in which allocation of consideration is based on vendor-specific objective evidence (“VSOE”) if available, third-party evidence (“TPE”), or if VSOE and TPE are not available, management’s best estimate of a standalone selling price (“ESP”) for the undelivered elements. The Company offers a cloud-based data management application, t:connect, which is made available to customers upon purchase of any of its insulin pumps. In July 2016, the Company received clearance from the FDA to begin offering the Tandem Device Updater, a Mac and PC-compatible when-and-if-available Product Returns The Company offers a 30-day |
Warranty Reserve | Warranty Reserve The Company generally provides a four-year warranty on its insulin pumps to end user customers and may replace any pumps that do not function in accordance with the product specifications. Insulin pumps returned to the Company may be refurbished and redeployed. Additionally, the Company offers a six-month At September 30, 2017 and December 31, 2016, the warranty reserve was $4.8 million and $5.7 million, respectively. The following table provides a reconciliation of the change in product warranty liabilities from December 31, 2016 through September 30, 2017 (in thousands): Balance at December 31, 2016 $ 5,690 Provision for warranties issued during the period 4,110 Settlements made during the period (5,240 ) Increases in warranty estimates 190 Balance at September 30, 2017 $ 4,750 Current portion $ 2,080 Non-current 2,670 Total $ 4,750 | Warranty Reserve The Company generally provides a four-year warranty on its insulin pumps to end user customers and may replace any pumps that do not function in accordance with the product specifications. Insulin pumps returned to the Company may be refurbished and redeployed. Additionally, the Company offers a six-month At December 31, 2016 and December 31, 2015, the warranty reserve was $5.7 million and $3.5 million, respectively. The following table provides a reconciliation of the change in estimated warranty liabilities for the years ended December 31, 2016 and 2015: December 31, (in thousands) 2016 2015 Balance at beginning of the year $ 3,547 $ 1,974 Provision for warranties issued during the period 8,830 1,948 Settlements made during the period (8,739 ) (4,373 ) Increases in warranty estimates 2,052 3,998 Balance at end of the year $ 5,690 $ 3,547 Current portion $ 2,302 $ 1,050 Non-current $ 3,388 2,497 Total $ 5,690 $ 3,547 |
Stock-Based Compensation | Stock-Based Compensation Stock-based compensation cost is measured at the grant date based on the estimated fair value of the award, and the portion that is ultimately expected to vest is recognized as compensation expense over the requisite service period on a straight-line basis. The Company estimates the fair value of stock options issued under the Company’s 2013 Stock Incentive Plan (“2013 Plan”) and shares issued under the Company’s 2013 Employee Stock Purchase Plan (“ESPP”) using a Black-Scholes option-pricing model on the date of grant. The Black-Scholes option-pricing model requires the use of subjective assumptions about a number of key variables, including stock price volatility, expected term, and risk-free interest rate. For awards that vest based on the achievement of service conditions, the Company recognizes expense using the straight-line method less estimated forfeitures based on historical experience. | Stock-Based Compensation Stock-based compensation cost is measured at the grant date based on the estimated fair value of the award, and the portion that is ultimately expected to vest is recognized as compensation expense over the requisite service period on a straight-line basis. The Company estimates the fair value of stock options issued under the Company’s 2013 Stock Incentive Plan (“2013 Plan”) and shares issued under the Company’s 2013 Employee Stock Purchase Plan (“ESPP”) using a Black-Scholes option-pricing model on the date of grant. The Black-Scholes option-pricing model requires the use of subjective assumptions including volatility, expected term, and risk-free rate. For awards that vest based on service conditions, the Company recognizes expense using the straight-line method less estimated forfeitures based on historical experience. The Company records the expense for stock option grants to non-employees non-employee |
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 common stock equivalents. Diluted net loss per share is calculated by dividing the net loss by the sum of the weighted average number of common shares that were outstanding for the period and the weighted-average number of dilutive common share equivalents outstanding for the period determined using the treasury stock method. Dilutive common share equivalents are comprised of warrants, options outstanding under the Company’s equity incentive plans, and shares subject to issuance pursuant to the ESPP. For all periods presented, there is no difference in the number of shares used to calculate basic and diluted shares outstanding due to the Company’s net loss position. Potentially dilutive securities not included in the calculation of diluted net loss per share (because inclusion would be anti-dilutive) are as follows (in thousands, in common stock equivalent shares): Nine Months Ended September 30, 2017 2016 Common stock warrants — 99 Common stock options 3 262 ESPP — 7 3 368 | 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 common stock equivalents. Diluted net loss per share is calculated by dividing the net loss by the sum of the weighted-average number of dilutive common share equivalents outstanding for the period determined using the treasury stock method. Dilutive common share equivalents are comprised of warrants, potential awards granted pursuant to the ESPP, and options outstanding under the Company’s other equity incentive plans. For all periods presented, there is no difference in the number of shares used to calculate basic and diluted shares outstanding due to the Company’s net loss position. Potentially dilutive securities not included in the calculation of diluted net loss per share (because inclusion would be anti-dilutive) are as follows (in common stock equivalent shares, in thousands): Year Ended December 31, 2016 2015 2014 Warrants for common stock — 99 100 Common stock options 151 201 223 ESPP 2 0 0 153 3,00 323 |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In August 2016, the Financial Accounting Standards Board (“FASB”) issued new guidance that clarifies how entities should classify certain cash receipts and cash payments on the statement of cash flows. The guidance also clarifies how the predominance principle should be applied when cash receipts and cash payments have aspects of more than one class of cash flows. The guidance is effective for public companies for fiscal years beginning after December 15, 2017, and interim periods within those years. The Company does not believe the adoption of the standard will have a material impact on the Company’s statement of cash flow. In June 2016, FASB issued a new credit loss standard that changes the impairment model for most financial assets and certain other instruments. The standard is effective for public business entities for annual periods beginning after December 15, 2019, and interim periods within those years. Early adoption is permitted for all entities for annual periods beginning after December 15, 2018, and interim periods within those years. The Company is in the process of assessing the impact of the adoption of the standard on its financial statements. In March 2016, FASB issued ASU 2016-09, 2016-09”), 2016-09 In February 2016, FASB issued final guidance for lease accounting. The new guidance requires lessees to put most leases on their balance sheet but to recognize expenses on their income statement in a manner similar to current accounting principles. The new guidance also eliminates the current real estate-specific provisions for all entities. The standard is effective for public companies for annual periods beginning after December 15, 2018, and interim periods within those years. Early adoption is permitted for all entities. The Company is in the process of assessing the impact of the adoption of the standard on its financial statements. In May 2014, FASB and the International Accounting Standards Board issued a comprehensive new revenue recognition standard (“Revenue from Contracts with Customers Standard”) that will supersede existing revenue guidance under U.S. GAAP and International Financial Reporting Standards. The Revenue from Contracts with Customers Standard’s core principle is that a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. In doing so, companies will need to use more judgment and make more estimates than under current guidance. The Revenue from Contracts with Customers Standard will be effective for the Company beginning in its first quarter of 2018, and early adoption is permitted. Subsequently, FASB issued the following standards related to Revenue from Contracts with Customers Standard: Principal versus Agent Considerations; Identifying Performance Obligations and Licensing; and Narrow-Scope Improvements and Practical Expedients (collectively, the “new revenue standards”). The new revenue standards may be applied retrospectively to each prior period presented (full retrospective method) or retrospectively with the cumulative effect recognized as of the date of adoption (the modified retrospective method). The Company currently expects to adopt the new revenue standards in the first quarter of 2018 utilizing the modified retrospective method. The Company currently believes that the adoption will not have a material impact on the recognition of revenues for the sale of its products through third-party distributors and insurance payors with whom it has contractual arrangements, which generally comprise approximately 99% of its sales. Additionally, the Company has given consideration to the accounting for warranty and commissions and does not anticipate a material change to its current method of expense recognition. As of September 30, 2017, the Company has not determined the full impact the adoption of the new revenue standard may have on its reported revenue or results of operations. | Recent Accounting Pronouncements In August 2016, the Financial Accounting Standards Board (“FASB”) issued new guidance that clarifies how entities should classify certain cash receipts and cash payments on the statement of cash flows. The guidance also clarifies how the predominance principle should be applied when cash receipts and cash payments have aspects of more than one class of cash flows. The guidance is effective for public business entities for fiscal years beginning after December 15, 2017, and interim periods within those years. The Company does not believe the adoption of the standard will have a material impact on the Company’s statement of cash flow. In June 2016, FASB issued a new credit loss standard that changes the impairment model for most financial assets and certain other instruments. The standard is effective for public business entities for annual periods beginning after December 15, 2019, and interim periods within those years. Early adoption is permitted for all entities for annual periods beginning after December 15, 2018, and interim periods within those years. The Company is in the process of assessing the impact of the adoption of the standard on its financial statements. In March 2016, FASB issued ASU 2016-09, 2016-09”), 2016-09 In February 2016, FASB issued final guidance for lease accounting. The new guidance requires lessees to put most leases on their balance sheet but to recognize expenses on their income statement in a manner similar to today’s accounting. The new guidance also eliminates today’s real estate-specific provisions for all entities. The standard is effective for public business entities for annual periods beginning after December 15, 2018, and interim periods within those years. Early adoption is permitted for all entities. The Company is in the process of assessing the impact of the adoption of the standard on its financial statements. In April 2015, FASB issued new guidance, which amended requirements that require debt issuance costs, related to a recognized debt liability, to be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, effective for the Company beginning January 1, 2016 and applied retroactively for all consolidated balance sheets presented. The Company applied the amended presentation requirements in the first quarter 2016, which resulted in the reclassification of $0.4 million of debt issuance costs in the Company’s balance sheet from other long-term assets to long-term notes payable at December 31, 2015. In August 2014, FASB issued an accounting standards update, which requires management of public and private companies to evaluate whether there are conditions and events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the financial statements are issued (or available to be issued when applicable) and, if so, to disclose that fact. Management is required to make this evaluation for both annual and interim reporting periods, if applicable. Management is also required to evaluate and disclose whether its plans alleviate that doubt. The standard is effective for annual periods ending after December 15, 2016, and interim periods within annual periods beginning after December 15, 2016. The Company adopted this standard as of December 31, 2016 and has included the expanded discussion on going concern above (see Note 1 “The Company”). In May 2014, FASB and the International Accounting Standards Board issued a comprehensive new revenue recognition standard (“Revenue from Contracts with Customers Standard”) that will supersede existing revenue guidance under U.S. GAAP and International Financial Reporting Standards. The Revenue from Contracts with Customers Standard’s core principle is that a company will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. In doing so, companies will need to use more judgment and make more estimates than under current guidance. The Revenue from Contracts with Customers Standard will be effective for the Company beginning in its first quarter of 2018, and early adoption is permitted. Subsequently, FASB issued the following standards related to Revenue from Contracts with Customers Standard: Principal versus Agent Considerations; Identifying Performance Obligations and Licensing; and Narrow-Scope Improvements and Practical Expedients. (collectively, the “new revenue standards”). The new revenue standards may be applied retrospectively to each prior period presented (full retrospective method) or retrospectively with the cumulative effect recognized as of the date of adoption (the modified retrospective method). The Company currently expects to adopt the new revenue standards in its first quarter of 2018 utilizing the modified retrospective method. The Company has begun assessing the impact of the adoption of the new revenue standards on its financial statements, and will not know whether there will be any impact of adoption until its assessment is completed sometime later in 2017. |
Segment Reporting | Segment Reporting Operating segments are identified as components of an enterprise about which segment discrete financial information is available for evaluation by the chief operating decision-maker in making decisions regarding resource allocation and assessing performance. To date, the Company has viewed its operations and managed its business as one segment, operating in the United States. | |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments with a maturity of three months or less from the date of purchase and that can be liquidated without prior notice or penalty, to be cash equivalents. | |
Short Term Investments | Short-Term Investments Based on the nature of the assets, the Company’s short-term investments are classified as either available-for-sale available-for-sale held-to-maturity. available-for-sale available-for-sale | |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash, cash equivalents, short-term investments and accounts receivable. The Company maintains deposit accounts in federally insured financial institutions in excess of federally insured limits. The Company also maintains investments in money market funds that are not federally insured. Additionally, the Company has established guidelines regarding investment instruments and their maturities, which are designed to maintain preservation of principal and liquidity. The following table summarizes customers who accounted for 10% or more of net accounts receivable: December 31, 2016 2015 Edgepark Medical Supplies, Inc. 15.2 % 16.4 % Byram Healthcare 14.7 % 21.8 % The following table summarizes customers who accounted for 10% or more of sales for the periods presented: December 31, 2016 2015 2014 Edgepark Medical Supplies, Inc. 18.7 % 17.8 % 16.0 % Byram Healthcare 14.0 % 17.2 % 10.9 % Solara Medical Supplies, Inc. 10.7 % N/A N/A CCS Medical N/A N/A 11.6 % | |
Inventories | Inventories Inventories are valued at the lower of cost or market (net realizable value), determined by the first-in, first-out | |
Long Lived Assets | Long Lived Assets Property and Equipment Property and equipment, which primarily consist of office furniture and equipment, manufacturing equipment, scientific equipment, computer equipment, and leasehold improvements, are stated at cost. Property and equipment are depreciated over the estimated useful lives of the assets, generally three to seven years, using the straight-line method. Leasehold improvements are amortized over the lesser of the estimated useful lives of the assets or the remaining lease term. Maintenance and repair costs are expensed as incurred. Patents Costs associated with the purchase or licensing of patents associated with the Company’s commercialized products are capitalized. The Company reviews its capitalized patent costs periodically to determine that they have future value and an alternative future use. Costs related to patents that the Company is not actively pursuing for commercial purposes are expensed. The Company amortizes patent costs over the lesser of the duration of the patent term or the estimated useful lives of 10 years, beginning with the date the patents are issued or acquired. The Company periodically re-evaluates | |
Deferred Rent | Deferred Rent Rent expense on noncancelable leases containing known future scheduled rent increases is recorded on a straight-line basis over the term of the respective leases beginning when the Company takes possession of the leased property. The difference between rent expense and rent paid is accounted for as deferred rent. The current portion of deferred rent was included in other current liabilities on the Company’s balance sheet. Landlord improvement allowances and other such lease incentives are recorded as property and equipment and as deferred rent and are amortized on a straight-line basis as a reduction to rent expense. | |
Research and Development Costs | Research and Development Costs All research and development costs are charged to expense as incurred. Such costs include personnel-related costs, including stock-based compensation, supplies, license fees, development prototypes, outside design and testing services, depreciation, allocated facilities and information services, milestone payments under the Company’s development and commercialization agreements and other indirect costs. | |
Income Taxes | Income Taxes The Company uses the asset and liability method of accounting for income taxes. Deferred income tax assets or liabilities are recognized based on the temporary differences between financial statement and income tax bases of assets and liabilities using enacted tax rates in effect for the years in which the differences are expected to reverse. A valuation allowance is recorded when it is more likely than not that some of the deferred tax assets will not be realized. The Company is required to file federal and state income tax returns in the United States and various other state jurisdictions. The preparation of these income tax returns requires the Company to interpret the applicable tax laws and regulations in effect in such jurisdictions, which could affect the amount of tax paid by the Company. An amount is accrued for the estimate of additional tax liability, including interest and penalties, for any uncertain tax positions taken or expected to be taken in an income tax return. The Company reviews and updates the accrual for uncertain tax positions as more definitive information becomes available. For further information, see Note 7, “Income Taxes.” | |
Advertising Costs | Advertising Costs The Company expenses advertising costs as they are incurred. For the years ended December 31, 2016, 2015 and 2014, advertising costs were $0.9 million, $1.0 million, and $1.5 million, respectively. | |
Shipping and Handling Expenses | Shipping and Handling Expenses Shipping and handling expenses associated with product delivery are included within cost of sales in the Company’s statements of operations. | |
Comprehensive Loss | Comprehensive Loss All components of comprehensive loss, including net loss, are reported in the financial statements in the period in which they are recognized. Comprehensive loss is defined as the change in equity during a period from transactions and other events and circumstances from non-owner | |
Reclassifications | Reclassifications Certain reclassifications of prior year amounts have been made to conform to the current year presentation. |
Summary of Significant Accoun23
Summary of Significant Accounting Policies (Tables) | 9 Months Ended | |
Sep. 30, 2017 | Dec. 31, 2016 | |
Accounting Policies [Abstract] | ||
Summary of Reconciliation of Change in Product Warranty Liabilities | The following table provides a reconciliation of the change in product warranty liabilities from December 31, 2016 through September 30, 2017 (in thousands): Balance at December 31, 2016 $ 5,690 Provision for warranties issued during the period 4,110 Settlements made during the period (5,240 ) Increases in warranty estimates 190 Balance at September 30, 2017 $ 4,750 Current portion $ 2,080 Non-current 2,670 Total $ 4,750 | The following table provides a reconciliation of the change in estimated warranty liabilities for the years ended December 31, 2016 and 2015: December 31, (in thousands) 2016 2015 Balance at beginning of the year $ 3,547 $ 1,974 Provision for warranties issued during the period 8,830 1,948 Settlements made during the period (8,739 ) (4,373 ) Increases in warranty estimates 2,052 3,998 Balance at end of the year $ 5,690 $ 3,547 Current portion $ 2,302 $ 1,050 Non-current $ 3,388 2,497 Total $ 5,690 $ 3,547 |
Schedule of Anti-Dilutive Securities | Potentially dilutive securities not included in the calculation of diluted net loss per share (because inclusion would be anti-dilutive) are as follows (in thousands, in common stock equivalent shares): Nine Months Ended September 30, 2017 2016 Common stock warrants — 99 Common stock options 3 262 ESPP — 7 3 368 | Potentially dilutive securities not included in the calculation of diluted net loss per share (because inclusion would be anti-dilutive) are as follows (in common stock equivalent shares, in thousands): Year Ended December 31, 2016 2015 2014 Warrants for common stock — 99 100 Common stock options 151 201 223 ESPP 2 0 0 153 3,00 323 |
Summary of Customers Accounted for 10% or More | The following table summarizes customers who accounted for 10% or more of net accounts receivable: December 31, 2016 2015 Edgepark Medical Supplies, Inc. 15.2 % 16.4 % Byram Healthcare 14.7 % 21.8 % The following table summarizes customers who accounted for 10% or more of sales for the periods presented: December 31, 2016 2015 2014 Edgepark Medical Supplies, Inc. 18.7 % 17.8 % 16.0 % Byram Healthcare 14.0 % 17.2 % 10.9 % Solara Medical Supplies, Inc. 10.7 % N/A N/A CCS Medical N/A N/A 11.6 % |
Short-Term Investments (Tables)
Short-Term Investments (Tables) | 9 Months Ended | |
Sep. 30, 2017 | Dec. 31, 2016 | |
Investments, Debt and Equity Securities [Abstract] | ||
Summary of Estimated Fair Value of Short-Term Investments | The Company invests in investment securities, principally debt instruments of financial institutions and corporations with strong credit ratings. The following represents a summary of the estimated fair value of short-term investments at September 30, 2017 and December 31, 2016 (in thousands): At September 30, 2017 Maturity (in years) Amortized Cost Unrealized Gain Unrealized Loss Estimated Fair Value Trading securities: Mutual funds held for nonqualified deferred compensation plan participants $ 416 $ 43 $ — $ 459 Total $ 416 $ 43 $ — $ 459 At December 31, 2016 Maturity (in years) Amortized Cost Unrealized Gain Unrealized Loss Estimated Fair Value Available-for-sale Commercial paper Less than 1 $ 8,483 $ 1 $ (2 ) $ 8,482 Trading securities: Mutual funds held for nonqualified deferred compensation plan participants $ 354 $ 26 $ (2 ) $ 378 Total $ 8,837 $ 27 $ (4 ) $ 8,860 | The following represents a summary of the estimated fair value of short-term investments at December 31, 2016 and 2015 (in thousands): At December 31, 2016 Maturity (in years) Amortized Cost Unrealized Gain Unrealized Loss Estimated Fair Value Available-for-sale Commercial paper Less $ 8,483 $ 1 $ (2 ) $ 8,482 Trading securities: Mutual funds held for nonqualified deferred compensation plan participants $ 354 $ 26 $ (2 ) $ 378 Total $ 8,837 $ 27 $ (4 ) $ 8,860 At December 31, 2015 Maturity (in years) Amortized Cost Unrealized Gain Unrealized Loss Estimated Fair Value Available-for-sale Commercial paper Less $ 21,712 $ 23 $ — $ 21,735 US Treasuries Less 2,035 — (1 ) 2,034 Government-sponsored enterprise securities Less 4,029 — (2 ) 4,027 $ 27,776 $ 23 $ (3 ) $ 27,796 Trading securities: Mutual funds held for nonqualified deferred compensation plan participants $ 224 $ 1 $ (3 ) $ 222 Total $ 28,000 $ 24 $ (6 ) $ 28,018 |
Inventory (Tables)
Inventory (Tables) | 9 Months Ended | |
Sep. 30, 2017 | Dec. 31, 2016 | |
Inventory Disclosure [Abstract] | ||
Summary of Inventory | Inventory consisted of the following at September 30, 2017 and December 31, 2016 (in thousands): September 30, December 31, 2017 2016 Raw materials $ 10,138 $ 9,375 Work in process 5,497 4,395 Finished goods 14,350 7,425 Total $ 29,985 $ 21,195 | Inventory consisted of the following at (in thousands): December 31, 2016 2015 Raw materials $ 9,375 $ 10,606 Work in process 4,395 3,394 Finished goods 7,425 3,543 Total $ 21,195 $ 17,543 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended | |
Sep. 30, 2017 | Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | ||
Schedule of Financial Assets and Liabilities Measured at Fair Value on Recurring Basis | The following table presents information about the Company’s financial assets and liabilities measured at fair value on a recurring basis as of September 30, 2017 and December 31, 2016, and indicates the fair value hierarchy of the valuation techniques utilized by the Company to determine such fair value (in thousands): Fair Value Measurements at September 30, 2017 (Level 1) (Level 2) (Level 3) Assets Cash equivalents (1) $ 16,527 $ 16,527 $ — $ — Mutual funds held for nonqualified deferred compensation plan participants (2) 459 459 — — Total assets $ 16,986 $ 16,986 $ — $ — Liabilities Deferred compensation (2) $ 459 $ 459 $ — $ — Total liabilities $ 459 $ 459 $ — $ — Fair Value Measurements at December 31, 2016 (Level 1) (Level 2) (Level 3) Assets Cash equivalents (1) $ 39,941 $ 39,941 $ — $ — Commercial paper 8,482 — 8,482 — Mutual funds held for nonqualified deferred compensation plan participants (2) 378 378 — — Total assets $ 48,801 $ 40,319 $ 8,482 $ — Liabilities Deferred compensation (2) $ 378 $ 378 $ — $ — Total liabilities $ 378 $ 378 $ — $ — (1) Generally, cash equivalents include money market funds and investments with a maturity of three months or less from the date of purchase. This asset is included as a component of cash and cash equivalents on the balance sheet, of which $10.0 million is classified as restricted cash - long-term at September 30, 2017. (2) The deferred compensation plan is directed by the Company and structured as a Rabbi Trust for the benefit of certain executives and non-employee | The following table presents information about the Company’s financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2016 and 2015, and indicates the fair value hierarchy of the valuation techniques utilized by the Company to determine such fair value (in thousands): Fair Value Measurements at December 31, 2016 December 31, 2016 Level 1 Level 2 Level 3 Assets Cash equivalents (1) $ 39,941 $ 39,941 $ — $ — Commercial paper 8,482 — 8,482 — Mutual funds held for nonqualified deferred compensation plan participants (2) 378 378 — — Total assets $ 48,801 $ 40,319 $ 8,482 $ — Liabilities Deferred compensation (2) $ 378 $ 378 $ — $ — Total liabilities $ 378 $ 378 $ — $ — Fair Value Measurements at December 31, 2015 December 31, 2015 Level 1 Level 2 Level 3 Assets Cash equivalents (1) $ 23,402 $ 23,402 $ — $ — Commercial paper 21,735 — 21,735 — Mutual funds held for nonqualified deferred compensation plan participants (2) 222 222 — — Treasury securities 2,034 2,034 — — Government-sponsored enterprise securities 4,027 — 4,027 — Total assets $ 51,420 $ 25,658 $ 25,762 $ — Liabilities Deferred compensation (2) $ 222 $ 222 $ — $ — Total liabilities $ 222 $ 222 $ — $ — (1) Cash equivalents included money market funds and commercial paper with a maturity of three months or less from the date of purchase. (2) Deferred compensation plans are compensation plans directed by the Company and structured as a Rabbi Trust for certain executives and non-employee |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) (Tables) | 9 Months Ended | |
Sep. 30, 2017 | Dec. 31, 2016 | |
Equity [Abstract] | ||
Schedule of Shares of Common Stock Reserved for Future Issuance | The following shares of the Company’s common stock were reserved for future issuance at September 30, 2017 (in thousands): Shares underlying outstanding warrants 293 Shares underlying outstanding stock options 933 Shares authorized for future equity award grants 39 Shares authorized for issuance as ESPP awards — 1,265 | The following shares of common stock are reserved for future issuance at December 31, 2016 (in thousands): Common stock warrants outstanding 99 Stock options issued and outstanding 822 Authorized for future option grants 56 Employee stock purchase plan 7 984 |
Schedule of Assumptions Used in Black-Scholes Option-Pricing Model | The assumptions used in the Black-Scholes option-pricing model are as follows: Stock Options Nine Months Ended September 30, 2017 2016 Weighted average grant date fair value (per share) $ 5.10 $ 37.80 Risk-free interest rate 1.9 % 1.4 % Expected dividend yield 0.0 % 0.0 % Expected volatility 60.0 % 55.5 % Expected term (in years) 6.1 6.1 ESPP Nine Months Ended September 30, 2017 (1) 2016 Weighted average grant date fair value (per share) N/A $ 26.90 Risk-free interest rate N/A 0.6 % Expected dividend yield N/A 0.0 % Expected volatility N/A 56.9 % Expected term (in years) N/A 1.3 (1) There were no grants made pursuant to the ESPP during the nine months ended September 30, 2017. | The assumptions used in the Black-Scholes option-pricing model are as follows: Stock Option Year Ended December 31, 2016 2015 2014 Weighted average grant date fair value (per share) $ 24.30 $ 71.50 $ 142.90 Risk-free interest rate 1.7 % 1.7 % 1.8 % Expected dividend yield 0.0 % 0.0 % 0.0 % Expected volatility 57.5 % 64.7 % 76.3 % Expected term (in years) 5.8 6.0 5.9 ESPP Year Ended December 31, 2016 2015 Weighted average grant date fair value (per share) $ 17.80 $ 45.50 Risk-free interest rate 0.7 % 0.5 % Expected dividend yield 0.0 % 0.0 % Expected volatility 62.7 % 61.2 % Expected term (in years) 1.3 1.3 |
Summary for Allocation of Stock-Based Compensation Expense | The following table summarizes the allocation of stock-based compensation expense (in thousands): Nine Months Ended September 30, 2017 2016 Cost of sales $ 1,022 $ 776 Selling, general & administrative 8,423 6,992 Research and development 1,057 965 Total $ 10,502 $ 8,733 | The compensation cost that has been included in the statement of operations for all stock-based compensation arrangements was as follows (in thousands): Year Ended December 31, 2016 2015 2014 Cost of sales $ 1,016 $ 1,162 $ 1,317 Selling, general & administrative 9,360 10,517 11,886 Research and development 1,284 1,417 1,792 Total $ 11,660 $ 13,096 $ 14,995 |
Summary of Stock Option Activities for 2006 Plan and 2013 Plan | The following table summarizes stock option activities for the 2006 Plan and 2013 Plan: Total Options Weighted- Average Exercise Price Per Share Weighted- Average Remaining Life (in years) Aggregate Intrinsic Value (in Outstanding at December 31, 2014 501,106 $ 102.04 8.62 $ 23,534 Granted 117,557 $ 120.06 Exercised (24,355 ) $ 13.82 $ 2,540 Canceled/forfeited/expired (19,408 ) $ 168.63 Outstanding at December 31, 2015 574,900 $ 107.22 7.99 $ 19,158 Granted 316,671 $ 45.75 Exercised (14,876 ) $ 11.49 $ 1,049 Canceled/forfeited/expired (53,857 ) $ 126.19 Outstanding at December 31, 2016 822,838 $ 84.05 7.92 $ 1,593 Vested and expected to vest at December 31, 2016 812,862 $ 84.24 7.91 $ 1,592 Exercisable at December 31, 2016 423,810 $ 98.61 6.80 $ 1,554 |
Financial Statement Informati28
Financial Statement Information (Tables) | 9 Months Ended |
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary of Accounts Receivable | Accounts receivable consisted of the following at (in thousands): December 31, 2016 2015 Accounts receivable $ 12,112 $ 14,583 Less allowance for doubtful accounts, and product returns (940 ) (528 ) Total $ 11,172 $ 14,055 |
Reconciliation of Change in Estimated Allowance for Doubtful Accounts, and Product Returns | The following table provides a reconciliation of the change in estimated allowance for doubtful accounts, and product returns for the years ended December 31, 2016, 2015 and 2014 (in thousands): Allowance doubtful Balance at December 31, 2013 $ 218 Provision for doubtful accounts and return reserves 188 Write-offs and adjustments, net of recoveries (153 ) Balance at December 31, 2014 $ 253 Provision for doubtful accounts and return reserves 70 Write-offs and adjustments, net of recoveries (102 ) Balance at December 31, 2015 $ 221 Provision for doubtful accounts and return reserves 632 Write-offs and adjustments, net of recoveries (118 ) Balance at December 31, 2016 $ 735 |
Summary of Property and Equipment | Property and equipment consisted of the following at (in thousands): December 31, 2016 2015 Leasehold improvements $ 8,851 $ 7,781 Computer equipment and software 7,844 6,599 Office furniture and equipment 4,185 3,898 Manufacturing and scientific equipment 16,785 12,793 37,665 31,071 Less accumulated depreciation and amortization (19,256 ) (15,545 ) Total $ 18,409 $ 15,526 |
Summary of Capitalized Patents | The following represents the capitalized patents at December 31, 2016 and 2015 (in thousands): December 31, 2016 2015 Gross amount $ 3,247 $ 3,247 Accumulated amortization (1,463 ) (1,137 ) Total $ 1,784 $ 2,110 Weighted average remaining amortization period (in months) 66 78 |
Term Loan Agreement (Tables)
Term Loan Agreement (Tables) | 9 Months Ended |
Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |
Future Minimum Principal Payments Under Term Loan Agreement | Future minimum principal payments under the Term Loan Agreement as of December 31, 2016, are as follows (in thousands): Year ended December 31, 2017 $ — 2018 — 2019 — 2020 81,080 2021 — Thereafter — Total $ 81,080 Less current portion of notes payable — Notes payable, net of current portion $ 81,080 |
Income Taxes (Tables)
Income Taxes (Tables) | 9 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) | The provision (benefit) for income taxes reconciles to the amount computed by applying the federal statutory rate to income before taxes as follows (in thousands): Year Ended December 31, 2016 2015 2014 Income tax benefit at federal statutory rate $ (28,362 ) $ (24,616 ) $ (27,065 ) State income tax, net of federal benefit (2,393 ) (2,285 ) (3,912 ) Research and development credits (720 ) (1,796 ) (646 ) Uncertain tax position — 3,154 — Stock-based compensation 1,686 1,904 1,973 Other 456 550 355 Removal of net operating losses and research and development credits — 8,344 — Change in valuation allowance 29,318 14,755 29,366 Income tax expense (recovery) $ (15 ) $ 10 $ 71 |
Schedule of Deferred Tax Assets and Liabilities | Significant components of the Company’s net deferred income tax assets at December 31, 2016 and 2015 are shown below (in thousands). A valuation allowance has been recorded to offset the net deferred tax asset as of December 31, 2016 and 2015, as the realization of such assets does not meet the more-likely-than-not December 31, 2016 2015 Deferred tax assets: Net operating loss (NOL) carryforwards $ 100,251 $ 79,233 Research and development tax credits carryforwards 2,543 1,832 Capitalized research and development expenses 16,673 13,296 Deferred rent 537 168 Accrued compensation 11,332 9,309 Other 5,931 4,104 Total deferred tax assets 137,267 107,942 Less valuation allowance (137,267 ) (107,942 ) Net deferred tax assets $ — $ — |
California NOL Carry Forwards Expiration | The California NOL carry forwards will expire as follows (in thousands): Year ended December 31, 2016 $ 624 2017 $ 2,052 Thereafter $ 167,828 |
Schedule of Unrecognized Tax Benefits | The following table summarizes the activity related to the Company’s gross unrecognized tax benefits at the beginning and end of the years ended December 31, 2016, 2015 and 2014 (in thousands): Year Ended December 31, 2016 2015 2014 Gross unrecognized tax benefits at the beginning of the year $ 7,594 $ 3,539 $ 1,912 Increases related to current year positions 580 474 476 Increases (decreases) related to prior year positions (7 ) 3,581 1,151 Expiration of unrecognized tax benefits — — — Gross unrecognized tax benefits at the end of the year $ 8,167 $ 7,594 $ 3,539 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 9 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Payments Under Noncancelable Operating Leases | Future minimum payments under the aforementioned noncancelable operating leases for each of the five succeeding years following December 31, 2016 are as follows (in thousands): 2017 $ 3,198 2018 3,630 2019 1,899 2020 643 2021 662 Thereafter 1,323 $ 11,355 |
Selected Quarterly Financial 32
Selected Quarterly Financial Data (Unaudited) (Tables) | 9 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Information | Quarterly financial information for fiscal 2016 and 2015 is presented in the following table, in thousands, except per share data: For the Quarter Ending March 31 June 30 September 30 December 31 2016: Revenue $ 20,058 $ 22,985 $ 12,293 $ 28,912 Gross profit $ 6,927 $ 8,176 $ (1,577 ) $ 10,065 Operating expenses $ 26,166 $ 25,229 $ 26,837 $ 23,411 Operating loss $ (19,239 ) $ (17,053 ) $ (28,414 ) $ (13,346 ) Net loss $ (20,485 ) $ (18,326 ) $ (29,815 ) $ (14,822 ) Basic and diluted net loss per share (1) $ (6.80 ) $ (6.00 ) $ (9.70 ) $ (4.80 ) 2015: Revenue $ 12,308 $ 15,706 $ 15,716 $ 29,120 Gross profit $ 2,808 $ 4,801 $ 5,513 $ 13,458 Operating expenses $ 23,218 $ 23,472 $ 24,216 $ 24,679 Operating loss $ (20,410 ) $ (18,671 ) $ (18,703 ) $ (11,221 ) Net loss $ (21,208 ) $ (19,533 ) $ (19,585 ) $ (12,093 ) Basic and diluted net loss per share (1) $ (8.30 ) $ (6.50 ) $ (6.50 ) $ (4.00 ) 2014: Revenue $ 8,066 $ 10,254 $ 13,513 $ 17,889 Gross profit $ 867 $ 3,448 $ 4,396 $ 6,537 Operating expenses $ 21,704 $ 21,766 $ 23,403 $ 24,039 Operating loss $ (20,837 ) $ (18,318 ) $ (19,007 ) $ (17,502 ) Net loss $ (21,961 ) $ (19,197 ) $ (19,901 ) $ (18,465 ) Basic and diluted net loss per share (1) $ (9.60 ) $ (8.30 ) $ (8.50 ) $ (7.80 ) (1) Net loss per share is computed independently for each of the quarters presented. Therefore, the sum of the quarterly per-share |
Organization and Basis of Pre33
Organization and Basis of Presentation - Additional Information (Detail) $ / shares in Units, $ in Thousands | Oct. 17, 2017USD ($)$ / sharesshares | Oct. 09, 2017shares | Mar. 31, 2015$ / sharesshares | Mar. 31, 2017$ / sharesshares | Dec. 31, 2016USD ($)shares | Sep. 30, 2016USD ($) | Jun. 30, 2016USD ($) | Mar. 31, 2016USD ($) | Dec. 31, 2015USD ($)shares | Sep. 30, 2015USD ($) | Jun. 30, 2015USD ($) | Mar. 31, 2015USD ($)$ / sharesshares | Dec. 31, 2014USD ($) | Sep. 30, 2014USD ($) | Jun. 30, 2014USD ($) | Mar. 31, 2014USD ($) | Sep. 30, 2017USD ($)shares | Sep. 30, 2016USD ($) | Dec. 31, 2016USD ($)shares | Dec. 31, 2015USD ($)shares | Dec. 31, 2014USD ($) |
Organization And Basis Of Presentation [Line Items] | |||||||||||||||||||||
Operating losses and accumulated deficit | $ (404,580) | $ (321,133) | $ (466,207) | $ (404,580) | $ (321,133) | ||||||||||||||||
Net loss | (14,822) | $ (29,815) | $ (18,326) | $ (20,485) | $ (12,093) | $ (19,585) | $ (19,533) | $ (21,208) | $ (18,465) | $ (19,901) | $ (19,197) | $ (21,961) | (61,627) | $ (68,624) | (83,447) | (72,418) | $ (79,524) | ||||
Cash used from operations | (54,495) | $ (47,591) | (61,173) | $ (58,764) | $ (61,378) | ||||||||||||||||
Cash and cash equivalents and short-term investments including restricted cash-long-term | $ 53,500 | 22,500 | $ 53,500 | ||||||||||||||||||
Restricted cash | $ 10,000 | ||||||||||||||||||||
Number of authorized shares of common stock remains | shares | 100,000,000 | 100,000,000 | 100,000,000 | 100,000,000 | 100,000,000 | ||||||||||||||||
Shares offered for public offering | shares | 6,037,500 | ||||||||||||||||||||
Secondary Public Offering [Member] | |||||||||||||||||||||
Organization And Basis Of Presentation [Line Items] | |||||||||||||||||||||
Shares offered for public offering | shares | 1,850,000 | 603,750 | |||||||||||||||||||
Shares offering price per share | $ / shares | $ 115 | $ 12.50 | $ 115 | ||||||||||||||||||
Subsequent Event [Member] | |||||||||||||||||||||
Organization And Basis Of Presentation [Line Items] | |||||||||||||||||||||
Reverse stock split of company's issued and outstanding shares of common stock description | 1-for-10 reverse stock split | ||||||||||||||||||||
Reverse stock split, conversion ratio | 0.1 | ||||||||||||||||||||
Number of authorized shares of common stock remains | shares | 100,000,000 | ||||||||||||||||||||
Subsequent Event [Member] | Secondary Public Offering [Member] | |||||||||||||||||||||
Organization And Basis Of Presentation [Line Items] | |||||||||||||||||||||
Proceeds from issuance of common stock, gross | $ 16,200 | ||||||||||||||||||||
Shares offered for public offering | shares | 4,630,000 | ||||||||||||||||||||
Shares offering price per share | $ / shares | $ 3.50 | ||||||||||||||||||||
Expected gross proceeds upon exercise of warrants | $ 16,200 | ||||||||||||||||||||
Subsequent Event [Member] | Series A warrants [Member] | Secondary Public Offering [Member] | |||||||||||||||||||||
Organization And Basis Of Presentation [Line Items] | |||||||||||||||||||||
Warrants issue to purchase common stock | shares | 4,630,000 | ||||||||||||||||||||
Warrants exercise price | $ / shares | $ 3.50 | ||||||||||||||||||||
Public offering period | 5 years | ||||||||||||||||||||
Subsequent Event [Member] | Series B warrants [Member] | Secondary Public Offering [Member] | |||||||||||||||||||||
Organization And Basis Of Presentation [Line Items] | |||||||||||||||||||||
Warrants issue to purchase common stock | shares | 4,630,000 | ||||||||||||||||||||
Warrants exercise price | $ / shares | $ 3.50 | ||||||||||||||||||||
Public offering period | 6 months | ||||||||||||||||||||
Term Loan Agreement [Member] | |||||||||||||||||||||
Organization And Basis Of Presentation [Line Items] | |||||||||||||||||||||
Restricted cash | $ 10,000 |
Summary of Significant Accoun34
Summary of Significant Accounting Policies - Additional Information (Detail) | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2017USD ($) | Dec. 31, 2016USD ($)Segment | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | |
Summary Of Significant Accounting Policies [Line Items] | |||||
Restricted cash | $ 2,000,000 | $ 2,000,000 | |||
Guarantee liabilities recognized as sales | $ 1,100,000 | ||||
Guarantee liabilities in other current liabilities | 0 | $ 1,200,000 | |||
Amount for upgradation requested but not yet fulfilled. | $ 200,000 | ||||
Offered period for sales return | 30 days | 30 days | |||
Allowance for product returns | $ 200,000 | $ 200,000 | 300,000 | ||
Warranty reserve | $ 4,750,000 | 5,690,000 | 3,547,000 | $ 1,974,000 | |
Excess tax benefits for which benefit could not previously be recognized | $ 8,167,000 | 7,594,000 | 3,539,000 | $ 1,912,000 | |
Percentage of revenue recognition from contracts with customers | 99.00% | ||||
Number of operating segments | Segment | 1 | ||||
Investment held-to-maturity | $ 0 | $ 0 | |||
Company amortizes patent costs over their estimated useful life | 66 months | 78 months | |||
Advertising cost | $ 900,000 | $ 1,000,000 | $ 1,500,000 | ||
Debt issuance cost | 400,000 | ||||
ASU 2016-09 [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Excess tax benefits for which benefit could not previously be recognized | 656,000 | ||||
Warranty reserves [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Warranty reserve | $ 4,800,000 | 5,700,000 | 3,500,000 | ||
Connect Hosting Service [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Deferred revenue | $ 1,800,000 | $ 1,600,000 | 1,100,000 | ||
Revenue recognition hosting period | 4 years | 4 years | |||
Tandem Pump [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Warranty period offered | 4 years | 4 years | |||
Slim cartridges and infusion sets [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Warranty period offered | 6 months | 6 months | |||
Trade-in rights reserve [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Deferred revenue | $ 3,200,000 | ||||
Term Loan Agreement [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Restricted cash | $ 10,000,000 | $ 2,000,000 | $ 2,000,000 | ||
Patents [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Company amortizes patent costs over their estimated useful life | 10 years | ||||
Minimum [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Estimated useful lives of the assets | 3 years | ||||
Maximum [Member] | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Estimated useful lives of the assets | 7 years |
Summary of Significant Accoun35
Summary of Significant Accounting Policies - Summary of Reconciliation of Change in Product Warranty Liabilities (Detail) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Movement In Standard And Extended Product Warranty Increase Decrease Roll Forward | |||
Beginning balance | $ 5,690 | $ 3,547 | $ 1,974 |
Provision for warranties issued during the period | 4,110 | 8,830 | 1,948 |
Settlements made during the period | (5,240) | (8,739) | (4,373) |
Increases in warranty estimates | 190 | 2,052 | 3,998 |
Ending balance | 4,750 | 5,690 | 3,547 |
Current portion | 2,080 | 2,302 | 1,050 |
Non-current portion | $ 2,670 | $ 3,388 | $ 2,497 |
Summary of Significant Accoun36
Summary of Significant Accounting Policies - Schedule of Anti-Dilutive Securities (Detail) - shares shares in Thousands | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||||
Antidilutive securities excluded from computation of earnings per share, amount | 3 | 368 | 153 | 300 | 323 |
Common stock warrants [Member] | |||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||||
Antidilutive securities excluded from computation of earnings per share, amount | 99 | 99 | 100 | ||
Employee Stock Option [Member] | |||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||||
Antidilutive securities excluded from computation of earnings per share, amount | 3 | 262 | 151 | 201 | 223 |
ESPP [Member] | |||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | |||||
Antidilutive securities excluded from computation of earnings per share, amount | 7 | 2 | 0 | 0 |
Short-Term Investments - Summar
Short-Term Investments - Summary of Estimated Fair Value of Short-Term Investments (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2017 | |
Cash Cash Equivalents And Short Term Investments [Line Items] | |||
Short-term investments, Amortized Cost | $ 8,837 | $ 28,000 | $ 416 |
Short-term investments, Unrealized Gain | 27 | 24 | 43 |
Short-term investments, Unrealized Loss | (4) | (6) | |
Short-term investments, Estimated Fair Value | 8,860 | 28,018 | 459 |
Trading securities - mutual funds held for nonqualified deferred compensation plan participants [Member] | |||
Cash Cash Equivalents And Short Term Investments [Line Items] | |||
Trading securities, Amortized Cost | 354 | 224 | 416 |
Trading securities, Unrealized Gain | 26 | 1 | 43 |
Trading securities, Unrealized Loss | (2) | (3) | |
Trading securities, Estimated Fair Value | 378 | 222 | $ 459 |
Commercial paper [Member] | |||
Cash Cash Equivalents And Short Term Investments [Line Items] | |||
Available-for-sale investment securities, Amortized Cost | 8,483 | 21,712 | |
Available-for-sale investment securities, Unrealized Gain | 1 | 23 | |
Available-for-sale investment securities, Unrealized Loss | (2) | ||
Available-for-sale investment securities, Estimated Fair Value | $ 8,482 | $ 21,735 | |
Commercial paper [Member] | Maximum [Member] | |||
Cash Cash Equivalents And Short Term Investments [Line Items] | |||
Available-for-sale investment securities, Maturity (in years) | 1 year | 1 year | |
US Treasuries [Member] | |||
Cash Cash Equivalents And Short Term Investments [Line Items] | |||
Available-for-sale investment securities, Amortized Cost | $ 2,035 | ||
Available-for-sale investment securities, Unrealized Loss | (1) | ||
Available-for-sale investment securities, Estimated Fair Value | $ 2,034 | ||
US Treasuries [Member] | Maximum [Member] | |||
Cash Cash Equivalents And Short Term Investments [Line Items] | |||
Available-for-sale investment securities, Maturity (in years) | 1 year | ||
Government-sponsored enterprise securities [Member] | |||
Cash Cash Equivalents And Short Term Investments [Line Items] | |||
Available-for-sale investment securities, Amortized Cost | $ 4,029 | ||
Available-for-sale investment securities, Unrealized Loss | (2) | ||
Available-for-sale investment securities, Estimated Fair Value | $ 4,027 | ||
Government-sponsored enterprise securities [Member] | Maximum [Member] | |||
Cash Cash Equivalents And Short Term Investments [Line Items] | |||
Available-for-sale investment securities, Maturity (in years) | 1 year |
Inventory - Summary of Inventor
Inventory - Summary of Inventory (Detail) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Inventory Disclosure [Abstract] | |||
Raw materials | $ 10,138 | $ 9,375 | $ 10,606 |
Work in process | 5,497 | 4,395 | 3,394 |
Finished goods | 14,350 | 7,425 | 3,543 |
Total | $ 29,985 | $ 21,195 | $ 17,543 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Financial Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Total assets | $ 16,986 | $ 48,801 | $ 51,420 |
Total liabilities | 459 | 378 | 222 |
Cash equivalents [Member] | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Total assets | 16,527 | 39,941 | 23,402 |
Commercial paper [Member] | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Total assets | 8,482 | 21,735 | |
Mutual funds held for nonqualified deferred compensation plan participants [Member] | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Total assets | 459 | 378 | 222 |
US Treasuries [Member] | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Total assets | 2,034 | ||
Government-sponsored enterprise securities [Member] | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Total assets | 4,027 | ||
Deferred compensation [Member] | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Total liabilities | 459 | 378 | 222 |
Level 1 [Member] | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Total assets | 16,986 | 40,319 | 25,658 |
Total liabilities | 459 | 378 | 222 |
Level 1 [Member] | Cash equivalents [Member] | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Total assets | 16,527 | 39,941 | 23,402 |
Level 1 [Member] | Mutual funds held for nonqualified deferred compensation plan participants [Member] | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Total assets | 459 | 378 | 222 |
Level 1 [Member] | US Treasuries [Member] | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Total assets | 2,034 | ||
Level 1 [Member] | Deferred compensation [Member] | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Total liabilities | $ 459 | 378 | 222 |
Level 2 [Member] | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Total assets | 8,482 | 25,762 | |
Level 2 [Member] | Commercial paper [Member] | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Total assets | $ 8,482 | 21,735 | |
Level 2 [Member] | Government-sponsored enterprise securities [Member] | |||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |||
Total assets | $ 4,027 |
Fair Value Measurements - Sch40
Fair Value Measurements - Schedule of Financial Assets and Liabilities Measured at Fair Value on Recurring Basis (Parenthetical) (Detail) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2017 | Dec. 31, 2016 | |
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Restricted cash-long-term | $ 10,000 | |
Maximum [Member] | ||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||
Cash equivalents maturity term | 3 months | 3 months |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Detail) - USD ($) | Mar. 07, 2017 | Sep. 30, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||||
Transfer between level 1 and level 2 assets | $ 0 | $ 0 | $ 0 | |
Guarantee liabilities in other current liabilities | $ 0 | $ 1,200,000 | ||
Term Loan Agreement [Member] | Capital Royalty Warrant [Member] | ||||
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | ||||
Warrants life | 10 years | |||
Warrants issue to purchase common stock | 193,788 | |||
Warrants exercise price | $ 23.50 | |||
Capital royalty warrant value | $ 3,300,000 |
Term Loan Agreement - Additiona
Term Loan Agreement - Additional Information (Detail) - USD ($) | Mar. 07, 2017 | Dec. 31, 2016 | Jan. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2017 | Oct. 01, 2015 | Sep. 30, 2015 |
Debt Instrument [Line Items] | |||||||||||
Loan outstanding | $ 81,080,000 | $ 81,080,000 | |||||||||
Interest rate | 11.50% | ||||||||||
Interest payable as cash | 9.50% | ||||||||||
Compounded interest payable | 2.00% | ||||||||||
Additional amount borrowed | $ 200,000,000 | $ 1,236,000 | $ 675,000 | 927,000 | $ 153,000 | $ 2,300,000 | |||||
Minimum annual revenues attainable in 2017 | 80,000,000 | 80,000,000 | 80,000,000 | 80,000,000 | |||||||
Minimum annual revenues attainable after 2017 | $ 95,000,000 | 95,000,000 | $ 95,000,000 | 95,000,000 | |||||||
Present value of the future cash flows | 10.00% | 10.00% | |||||||||
Minimum annual revenues attained in 2016 | $ 65,000,000 | $ 65,000,000 | |||||||||
Term Loan Agreement [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Loan outstanding | $ 81,100,000 | 30,200,000 | $ 82,300,000 | $ 81,100,000 | 30,200,000 | $ 82,300,000 | |||||
Interest rate | 11.50% | 11.50% | 11.50% | 11.50% | |||||||
Interest payable as cash | 9.50% | 9.50% | 9.50% | 9.50% | |||||||
Compounded interest payable | 2.00% | 2.00% | 2.00% | 2.00% | |||||||
Interest-only payments description | Under the Term Loan Agreement, interest is payable at the Company’s option, (i) in cash at a rate of 11.5% per annum, or (ii) at a rate of 9.5% of the 11.5% per annum in cash and 2.0% of the 11.5% per annum (the “PIK Loan”) to be added to the principal of the loan and subject to accruing interest. Interest-only payments are due quarterly on March 31, June 30, September 30 and December 31 of each year of the interest-only payment period, which ends on December 31, 2019. | The other principal terms of the Term Loan Agreement were not amended by the Third Amendment. Accordingly, interest continues to be payable, at the Company’s option, (i) in cash at a rate of 11.5% per annum, or (ii) at a rate of 9.5% of the 11.5% per annum in cash and 2.0% of the 11.5% per annum (the “PIK Loan”) to be added to the principal of the loan and subject to accruing interest. Interest-only payments continue to be due quarterly on March 31, June 30, September 30 and December 31 of each year of the interest-only payment period, which ends on December 31, 2019. | |||||||||
Maturity date for interest-only payment | Dec. 31, 2019 | Dec. 31, 2019 | |||||||||
Maturity date for principal balance | Mar. 31, 2020 | Mar. 31, 2020 | |||||||||
Percentage of financing fee | 5.00% | ||||||||||
Restricted cash balance | $ 10,000,000 | $ 2,000,000 | $ 2,000,000 | $ 2,000,000 | $ 2,000,000 | ||||||
Prepayment fee percentage | 1.00% | ||||||||||
Third Amendment [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Percentage of financing fee | 3.00% | 3.00% | |||||||||
Line of credit facility amount borrowed | 35,000,000 | $ 15,000,000 | $ 50,000,000 | ||||||||
Line of credit facility additional borrowing capacity | $ 50,000,000 | ||||||||||
Third Amendment [Member] | Other Long Term Liabilities And As Contra-Debt In Notes Payable-Long Term [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Accrued back end financing fee | 1,500,000 | $ 4,100,000 | $ 1,500,000 | $ 4,100,000 | |||||||
Fourth Amendment [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Restricted cash balance | $ 10,000,000 | $ 2,000,000 | $ 2,000,000 | ||||||||
Equity finance completion last date | Jan. 15, 2018 | ||||||||||
Present value of the future cash flows | 10.00% | 10.00% | |||||||||
Warrants life | 10 years | ||||||||||
Warrants issue to purchase common stock | 1,937,890 | ||||||||||
Warrants exercise price | $ 2.35 | ||||||||||
Fourth Amendment [Member] | Minimum [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Gross proceeds from sale of equity securities on event of default occurred due to going concern qualification | $ 30,000,000 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Detail) - USD ($) | Jan. 01, 2017 | Jan. 01, 2016 | Oct. 31, 2013 | Jul. 31, 2017 | Mar. 31, 2015 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Mar. 31, 2015 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||
Shares offered for public offering | 6,037,500 | |||||||||||||
Gross proceeds from secondary public offering | $ 23,100,000 | $ 64,900,000 | ||||||||||||
Common stock shares issued | 24,408 | 14,897 | 24,355 | |||||||||||
Stock-based compensation expenses | $ 10,502,000 | $ 8,733,000 | $ 11,660,000 | $ 13,096,000 | $ 14,995,000 | |||||||||
Total stock-based compensation expense capitalized as part of cost of inventory | $ 300,000 | $ 200,000 | $ 100,000 | |||||||||||
Common stock reserved for future issuance | 1,265,000 | 1,265,000 | 984,000 | |||||||||||
Options outstanding | 822,838 | 574,900 | 501,106 | |||||||||||
Unamortized compensation expense | $ 14,000,000 | |||||||||||||
Share-based compensation expense remaining vesting term | 1 year 10 months 25 days | |||||||||||||
Expected dividend yield | 0.00% | |||||||||||||
2006 Stock Incentive Plan [Member] | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||
Common stock reserved for future issuance | 268,560 | |||||||||||||
2013 Stock Incentive Plan [Member] | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||
Common stock reserved for future issuance | 480,900 | 56,228 | ||||||||||||
Increase in common stock reserve for issuance | 124,382 | 121,018 | ||||||||||||
Common Stock [Member] | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||
Common stock shares issued | 15,000 | 24,000 | 14,000 | |||||||||||
Secondary Public Offering [Member] | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||
Shares offered for public offering | 1,850,000 | 603,750 | ||||||||||||
Shares offering price per share | $ 115 | $ 12.50 | $ 115 | |||||||||||
ESPP [Member] | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||
Purchase of common stock under ESPP | 38,929 | 69,502 | ||||||||||||
Offering Period | 2 years | 2 years | ||||||||||||
Purchase Period | four six-month | four six-month | ||||||||||||
Stock-based compensation expenses | $ 2,400,000 | |||||||||||||
Increase in common stock reserve for issuance | 31,095 | 30,254 | ||||||||||||
Issuance of common stock available for grant | 55,600 | |||||||||||||
Number of shares available for grant | 7,846 | |||||||||||||
Common stock reserved for issuance description | The number of shares of common stock reserved for issuance increases on January 1 of each calendar year, from January 1, 2014 through January 1, 2023, by the lesser of (a) one percent (1%) of the number of shares issued and outstanding on the immediately preceding December 31, or (b) such lesser number of shares as determined by the Administrator. | |||||||||||||
Maximum percentage that employee can contribute for purchase of common stock | 15.00% | |||||||||||||
Expected dividend yield | 0.00% | 0.00% | 0.00% | |||||||||||
ESPP [Member] | Minimum [Member] | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||
Percentage of common stock reserve for issuance to be increased | 1.00% | |||||||||||||
At The Market (ATM) Program [Member] | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||
Gross proceeds from secondary public offering | $ 4,300,000 | |||||||||||||
At The Market (ATM) Program [Member] | Maximum [Member] | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||
Proceeds from issuance of common stock, gross | $ 15,000,000 | |||||||||||||
At The Market (ATM) Program [Member] | Common Stock [Member] | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||
Shares offered for public offering | 464,108 | |||||||||||||
At The Market (ATM) Program [Member] | Common Stock [Member] | Maximum [Member] | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||
Shares offering price per share | $ 10.54 | $ 10.54 | ||||||||||||
At The Market (ATM) Program [Member] | Common Stock [Member] | Minimum [Member] | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||
Shares offering price per share | $ 5.64 | $ 5.64 | ||||||||||||
Selling, general & administrative [Member] | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||
Stock-based compensation expenses | $ 8,423,000 | $ 6,992,000 | $ 9,360,000 | $ 10,517,000 | $ 11,886,000 | |||||||||
Non-employees [Member] | Selling, general & administrative [Member] | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||
Stock-based compensation expenses | $ 0 | $ 35,000 | $ 300,000 | |||||||||||
Employee Stock Option [Member] | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||
Vesting period of remaining stock | 3 years | |||||||||||||
Employee Stock Option [Member] | 2006 Stock Incentive Plan [Member] | Maximum [Member] | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||
Maximum term of stock options | 10 years | |||||||||||||
Employee Stock Option [Member] | 2013 Stock Incentive Plan [Member] | Maximum [Member] | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||
Maximum term of stock options | 10 years | |||||||||||||
First Anniversary of Vesting Date [Member] | Employee Stock Option [Member] | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||
Stock vested percentage | 25.00% | |||||||||||||
Date of Offering [Member] | ESPP [Member] | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||
Purchase price of common stock on date of purchase | 85.00% | |||||||||||||
Date of Purchase [Member] | ESPP [Member] | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||
Purchase price of common stock on date of purchase | 85.00% | |||||||||||||
Scenario, Previously Reported [Member] | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||
Common stock shares issued | 14,876 | |||||||||||||
Scenario, Previously Reported [Member] | ESPP [Member] | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||||||||
Purchase of common stock under ESPP | 69,233 | 30,218 |
Stockholders' Equity - Schedule
Stockholders' Equity - Schedule of Shares of Common Stock Reserved for Future Issuance (Detail) - shares shares in Thousands | Sep. 30, 2017 | Dec. 31, 2016 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Common stock reserved for future issuance | 1,265 | 984 |
Common stock warrants [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Common stock reserved for future issuance | 293 | 99 |
Shares underlying outstanding stock options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Common stock reserved for future issuance | 933 | 822 |
Shares authorized for future equity award grants [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Common stock reserved for future issuance | 39 | 56 |
Shares authorized for issuance as ESPP awards [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Common stock reserved for future issuance | 7 |
Stockholders' Equity - Schedu45
Stockholders' Equity - Schedule of Assumptions Used in Black-Scholes Option-Pricing Model (Detail) - $ / shares | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Expected dividend yield | 0.00% | ||||
Employee Stock Option [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Weighted average grant date fair value (per share) | $ 5.10 | $ 37.80 | $ 24.30 | $ 71.50 | $ 142.90 |
Risk-free interest rate | 1.90% | 1.40% | 1.70% | 1.70% | 1.80% |
Expected dividend yield | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% |
Expected volatility | 60.00% | 55.50% | 57.50% | 64.70% | 76.30% |
Expected term (in years) | 6 years 1 month 6 days | 6 years 1 month 6 days | 5 years 9 months 18 days | 6 years | 5 years 10 months 25 days |
ESPP [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Weighted average grant date fair value (per share) | $ 26.90 | $ 17.80 | $ 45.50 | ||
Risk-free interest rate | 0.60% | 0.70% | 0.50% | ||
Expected dividend yield | 0.00% | 0.00% | 0.00% | ||
Expected volatility | 56.90% | 62.70% | 61.20% | ||
Expected term (in years) | 1 year 3 months 18 days | 1 year 3 months 19 days | 1 year 3 months 19 days |
Stockholders' Equity - Schedu46
Stockholders' Equity - Schedule of Assumptions Used in Black-Scholes Option-Pricing Model (Parenthetical) (Detail) - shares | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Grants made during period | 316,671 | 117,557 | |
ESPP [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Grants made during period | 0 |
Stockholders' Equity - Summary
Stockholders' Equity - Summary for Allocation of Stock-Based Compensation Expense (Detail) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Compensation cost | $ 10,502 | $ 8,733 | $ 11,660 | $ 13,096 | $ 14,995 |
Cost of sales [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Compensation cost | 1,022 | 776 | 1,016 | 1,162 | 1,317 |
Selling, general & administrative [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Compensation cost | 8,423 | 6,992 | 9,360 | 10,517 | 11,886 |
Research and development [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Compensation cost | $ 1,057 | $ 965 | $ 1,284 | $ 1,417 | $ 1,792 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) | Jun. 30, 2016Lease | Sep. 30, 2017LegalMatter | Dec. 31, 2016USD ($)LegalMatter | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 01, 2016USD ($) |
Commitments And Contingencies Disclosure [Abstract] | ||||||
Number of legal proceedings, regulatory encounters or other matters | LegalMatter | 0 | 0 | ||||
Noncancelable Operating Lease Agreement Amended Due on May 2019 [Member] | ||||||
Commitments And Contingencies Disclosure [Abstract] | ||||||
Amended lease expiration period | 2022-05 | |||||
Tenant improvement allowances received under operating lease | $ 900,000 | $ 1,600,000 | ||||
Unsecured standby letter of credit | $ 500,000 | |||||
Lease agreement expiration period | Jul. 14, 2019 | |||||
Barnes Canyon Lease Due on November 2023 [Member] | ||||||
Commitments And Contingencies Disclosure [Abstract] | ||||||
Lease agreement expiration period | 2023-11 | |||||
Lease term description | The Barnes Canyon Lease is scheduled to expire in November 2023. The Company will also have a one-time option to extend the term of the lease for a period of not less than 36 months and not greater than 60 months, by delivering notice to the landlord at least nine months and not more than 12 months prior to the expiration of the lease. | |||||
Number of option to extend lease term | Lease | 1 | |||||
Interest accrual rate on amounts utilized from tenant improvement allowance | 8.00% | |||||
Non structural improvements costs | $ 1,000,000 | |||||
Reimbursement from landlord | 0 | |||||
TI Rent 2016 | $ 0 | |||||
Tl Rent 2017 | 500,000 | |||||
Tl Rent 2018 | 700,000 | |||||
Tl Rent 2019 | 700,000 | |||||
Tl Rent 2020 | 700,000 | |||||
Tl Rent 2021 | 700,000 | |||||
Tl Rent 2022 and thereafter | $ 1,300,000 | |||||
Barnes Canyon Lease Due on November 2023 [Member] | Other Current Assets [Member] | ||||||
Commitments And Contingencies Disclosure [Abstract] | ||||||
Receivables | 700,000 | |||||
Barnes Canyon Lease Due on November 2023 [Member] | Minimum [Member] | ||||||
Commitments And Contingencies Disclosure [Abstract] | ||||||
Period of extended lease term | 36 months | |||||
Notice period for extend lease term to landlord | 9 months | |||||
Barnes Canyon Lease Due on November 2023 [Member] | Maximum [Member] | ||||||
Commitments And Contingencies Disclosure [Abstract] | ||||||
Tenant improvement allowances received under operating lease | 3,400,000 | |||||
Period of extended lease term | 60 months | |||||
Notice period for extend lease term to landlord | 12 months | |||||
Existing Operating Lease and Barnes Canyon Lease [Member] | ||||||
Commitments And Contingencies Disclosure [Abstract] | ||||||
Deferred rent arising from rent escalations and lease incentives | 3,700,000 | 3,700,000 | ||||
Rent expense | $ 3,100,000 | $ 2,600,000 | $ 2,100,000 |
Subsequent Event - Additional I
Subsequent Event - Additional Information (Detail) | Oct. 17, 2017USD ($)$ / sharesshares | Oct. 09, 2017shares | Mar. 07, 2017USD ($)$ / sharesshares | Mar. 31, 2015$ / sharesshares | Mar. 31, 2017USD ($)$ / sharesshares | Mar. 31, 2015USD ($)$ / sharesshares | Sep. 30, 2017USD ($)shares | Dec. 31, 2016USD ($)shares | Dec. 31, 2015USD ($)shares |
Subsequent Event [Line Items] | |||||||||
Number of authorized shares of common stock remains | 100,000,000 | 100,000,000 | 100,000,000 | ||||||
Shares offered for public offering | 6,037,500 | ||||||||
Gross proceeds from secondary public offering | $ | $ 23,100,000 | $ 64,900,000 | |||||||
Aggregate principal amount of borrowings outstanding, including total PIK Loans issued | $ | $ 81,080,000 | ||||||||
Secondary Public Offering [Member] | |||||||||
Subsequent Event [Line Items] | |||||||||
Shares offered for public offering | 1,850,000 | 603,750 | |||||||
Shares offering price per share | $ / shares | $ 115 | $ 12.50 | $ 115 | ||||||
Subsequent Event [Member] | |||||||||
Subsequent Event [Line Items] | |||||||||
Reverse stock split of company's issued and outstanding shares of common stock description | 1-for-10 reverse stock split | ||||||||
Reverse stock split, conversion ratio | 0.1 | ||||||||
Number of authorized shares of common stock remains | 100,000,000 | ||||||||
Gross proceeds from secondary public offering | $ | $ 16,200,000 | ||||||||
Subsequent Event [Member] | Secondary Public Offering [Member] | |||||||||
Subsequent Event [Line Items] | |||||||||
Shares offered for public offering | 4,630,000 | ||||||||
Shares offering price per share | $ / shares | $ 3.50 | ||||||||
Public offering issuance date | Oct. 17, 2017 | ||||||||
Subsequent Event [Member] | Series A warrants [Member] | Secondary Public Offering [Member] | |||||||||
Subsequent Event [Line Items] | |||||||||
Warrants issue to purchase common stock | 4,630,000 | ||||||||
Warrants exercise price | $ / shares | $ 3.50 | ||||||||
Public offering period | 5 years | ||||||||
Subsequent Event [Member] | Series B warrants [Member] | Secondary Public Offering [Member] | |||||||||
Subsequent Event [Line Items] | |||||||||
Warrants issue to purchase common stock | 4,630,000 | ||||||||
Warrants exercise price | $ / shares | $ 3.50 | ||||||||
Public offering period | 6 months | ||||||||
Fourth Amendment [Member] | |||||||||
Subsequent Event [Line Items] | |||||||||
Warrants issue to purchase common stock | 1,937,890 | ||||||||
Warrants exercise price | $ / shares | $ 2.35 | ||||||||
Equity finance completion last date | Jan. 15, 2018 | ||||||||
Restricted cash balance | $ | $ 10,000,000 | 2,000,000 | |||||||
Fourth Amendment [Member] | Minimum [Member] | |||||||||
Subsequent Event [Line Items] | |||||||||
Gross proceeds from sale of equity securities on event of default occurred due to going concern qualification | $ | 30,000,000 | ||||||||
Term Loan Agreement [Member] | |||||||||
Subsequent Event [Line Items] | |||||||||
Restricted cash balance | $ | $ 10,000,000 | 2,000,000 | $ 2,000,000 | ||||||
Aggregate principal amount of borrowings outstanding, including total PIK Loans issued | $ | $ 82,300,000 | $ 81,100,000 | $ 30,200,000 | ||||||
Percentage of financing fee | 5.00% |
Summary of Significant Accoun50
Summary of Significant Accounting Policies - Summary of Customers Accounted for 10% or More (Detail) - Customer Concentration Risk | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Accounts Receivable [Member] | Byram Healthcare [Member] | |||
Concentration Risk [Line Items] | |||
Customers accounted for 10% or more | 14.70% | 21.80% | |
Accounts Receivable [Member] | Edgepark Medical Supplies Inc [Member] | |||
Concentration Risk [Line Items] | |||
Customers accounted for 10% or more | 15.20% | 16.40% | |
Sales Revenue Net [Member] | Byram Healthcare [Member] | |||
Concentration Risk [Line Items] | |||
Customers accounted for 10% or more | 14.00% | 17.20% | 10.90% |
Sales Revenue Net [Member] | Edgepark Medical Supplies Inc [Member] | |||
Concentration Risk [Line Items] | |||
Customers accounted for 10% or more | 18.70% | 17.80% | 16.00% |
Sales Revenue Net [Member] | Solara Medical Supplies, Inc. [Member] | |||
Concentration Risk [Line Items] | |||
Customers accounted for 10% or more | 10.70% | ||
Sales Revenue Net [Member] | CCS Medical [Member] | |||
Concentration Risk [Line Items] | |||
Customers accounted for 10% or more | 11.60% |
Financial Statement Informati51
Financial Statement Information - Summary of Accounts receivable (Detail) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Accounts Receivable Net [Abstract] | |||
Accounts receivable | $ 12,112 | $ 14,583 | |
Less allowance for doubtful accounts, and product returns | (940) | (528) | |
Total | $ 10,582 | $ 11,172 | $ 14,055 |
Financial Statement Informati52
Financial Statement Information - Reconciliation of Change in Estimated Allowance for Doubtful Accounts, and Product Returns (Detail) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Allowance for doubtful accounts | |||||
Beginning Balance | $ 735 | $ 221 | $ 221 | $ 253 | $ 218 |
Provision for doubtful accounts and return reserves | $ 664 | $ 666 | 632 | 70 | 188 |
Write-offs and adjustments, net of recoveries | (118) | (102) | (153) | ||
Ending Balance | $ 735 | $ 221 | $ 253 |
Financial Statement Informati53
Financial Statement Information - Summary of Property and Equipment (Detail) - USD ($) $ in Thousands | Sep. 30, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Property Plant And Equipment [Line Items] | |||
Property and equipment, gross | $ 37,665 | $ 31,071 | |
Less accumulated depreciation and amortization | (19,256) | (15,545) | |
Total property and equipment, net | $ 20,286 | 18,409 | 15,526 |
Leasehold improvements [Member] | |||
Property Plant And Equipment [Line Items] | |||
Property and equipment, gross | 8,851 | 7,781 | |
Computer equipment and software [Member] | |||
Property Plant And Equipment [Line Items] | |||
Property and equipment, gross | 7,844 | 6,599 | |
Office furniture and equipment [Member] | |||
Property Plant And Equipment [Line Items] | |||
Property and equipment, gross | 4,185 | 3,898 | |
Manufacturing and scientific equipment [Member] | |||
Property Plant And Equipment [Line Items] | |||
Property and equipment, gross | $ 16,785 | $ 12,793 |
Financial Statement Informati54
Financial Statement Information - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Schedule Of Balance Sheet Components [Abstract] | |||
Depreciation and amortization expense related to property and equipment | $ 5.2 | $ 4.5 | $ 4.1 |
Amortization expense related to intangible assets | 0.3 | $ 0.3 | $ 0.3 |
Estimated annual amortization | $ 0.3 |
Financial Statement Informati55
Financial Statement Information - Summary of Capitalized Patents (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2017 | |
Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Weighted average remaining amortization period (in months) | 66 months | 78 months | |
Patents [Member] | |||
Indefinite Lived Intangible Assets By Major Class [Line Items] | |||
Gross amount | $ 3,247 | $ 3,247 | |
Accumulated amortization | (1,463) | (1,137) | |
Total | $ 1,784 | $ 2,110 | $ 1,539 |
Weighted average remaining amortization period (in months) | 10 years |
Term Loan Agreement - Future Mi
Term Loan Agreement - Future Minimum Principal Payments Under Term Loan Agreement (Detail) $ in Thousands | Dec. 31, 2016USD ($) |
Long Term Debt By Maturity [Abstract] | |
2,017 | $ 0 |
2,018 | 0 |
2,019 | 0 |
2,020 | 81,080 |
2,021 | 0 |
Thereafter | 0 |
Total | 81,080 |
Less current portion of notes payable | 0 |
Notes payable, net of current portion | $ 81,080 |
Stockholders' Equity (Deficit57
Stockholders' Equity (Deficit) - Summary of Stock Option Activities for 2006 Plan and 2013 Plan (Detail) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Options, Outstanding at beginning of period | 822,838 | 574,900 | 501,106 | |
Options, Granted | 316,671 | 117,557 | ||
Options, Exercised | (24,408) | (14,897) | (24,355) | |
Options, Canceled/forfeited/expired | (53,857) | (19,408) | ||
Options, Outstanding at end of period | 822,838 | 574,900 | 501,106 | |
Options, Vested and expected to vest at December 31, 2016 | 812,862 | |||
Options, Exercisable at December 31, 2016 | 423,810 | |||
Weighted-Average Exercise Price Per Share, Outstanding at beginning of period | $ 84.05 | $ 107.22 | $ 102.04 | |
Options, Vested and expected to vest at December 31, 2016 | 812,862 | |||
Weighted-Average Exercise Price Per Share, Granted | $ 45.75 | 120.06 | ||
Weighted-Average Exercise Price Per Share, Exercised | 11.49 | 13.82 | ||
Weighted-Average Exercise Price Per Share, Canceled/forfeited/expired | 126.19 | 168.63 | ||
Weighted-Average Exercise Price Per Share, Outstanding at end of period | 84.05 | $ 107.22 | $ 102.04 | |
Weighted-Average Exercise Price Per Share, Vested and expected to vest at December 31, 2016 | $ 84.24 | |||
Aggregate Intrinsic Value, Outstanding at beginning period | $ 1,593 | $ 19,158 | $ 23,534 | |
Weighted-Average Exercise Price Per Share, Exercisable at December 31, 2016 | $ 98.61 | |||
Weighted-Average Remaining Contractual Life, Outstanding | 7 years 11 months 1 day | 7 years 11 months 26 days | 8 years 7 months 13 days | |
Weighted-Average Remaining Contractual Life, Vested and expected to vest at December 31, 2016 | 7 years 10 months 28 days | |||
Weighted-Average Remaining Contractual Life, Exercisable at December 31, 2016 | 6 years 9 months 18 days | |||
Aggregate Intrinsic Value, Exercised | $ 1,049 | $ 2,540 | ||
Aggregate Intrinsic Value, Outstanding at end of period | 1,593 | $ 19,158 | $ 23,534 | |
Aggregate Intrinsic Value, Vested and expected to vest at December 31, 2016 | 1,592 | |||
Aggregate Intrinsic Value, Exercisable at December 31, 2016 | $ 1,554 | |||
Scenario, Previously Reported [Member] | ||||
Options, Exercised | (14,876) |
Income Taxes - Schedule of Comp
Income Taxes - Schedule of Components of Income Tax Expense (Benefit) (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||
Income tax benefit at federal statutory rate | $ (28,362) | $ (24,616) | $ (27,065) |
State income tax, net of federal benefit | (2,393) | (2,285) | (3,912) |
Research and development credits | (720) | (1,796) | (646) |
Uncertain tax position | 3,154 | ||
Stock-based compensation | 1,686 | 1,904 | 1,973 |
Other | 456 | 550 | 355 |
Removal of net operating losses and research and development credits | 8,344 | ||
Change in valuation allowance | 29,318 | 14,755 | 29,366 |
Income tax expense (recovery) | $ (15) | $ 10 | $ 71 |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Detail) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | Mar. 31, 2015 |
Deferred tax assets: | |||
Net operating loss (NOL) carryforwards | $ 100,251 | $ 79,233 | $ 16,000 |
Research and development tax credits carryforwards | 2,543 | 1,832 | $ 2,900 |
Capitalized research and development expenses | 16,673 | 13,296 | |
Deferred rent | 537 | 168 | |
Accrued compensation | 11,332 | 9,309 | |
Other | 5,931 | 4,104 | |
Total deferred tax assets | 137,267 | 107,942 | |
Less valuation allowance | (137,267) | (107,942) | |
Net deferred tax assets | $ 0 | $ 0 |
Income Taxes - California NOL C
Income Taxes - California NOL Carry Forwards Expiration (Detail) - California [Member] $ in Thousands | Dec. 31, 2016USD ($) |
Operating Loss Carryforwards [Line Items] | |
2,016 | $ 624 |
2,017 | 2,052 |
Thereafter | $ 167,828 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |
Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Line Items] | |||
Accumulated federal NOL carryforwards | $ 283,500 | ||
Accumulated state NOL carryforwards | 269,700 | ||
Research and development tax credits carryforwards | $ 2,900 | 2,543 | $ 1,832 |
NOL carryforwards from excess tax deductions | $ 1,800 | ||
Deferred Tax Assets Tax Credit Carryforwards Research Expiration Year | 2,028 | ||
Deferred tax assets for NOLs | $ 16,000 | $ 100,251 | 79,233 |
Shares offered for public offering | 6,037,500 | ||
Evaluation of tax position, description | The evaluation of uncertainty in a tax position is a two-step process. The first step involves recognition. The Company determines whether it is more likely than not that a tax position will be sustained upon tax examination, including resolution of any related appeals or litigation, based on only the technical merits of the position. The technical merits of a tax position are derived from both statutory and judicial authority (legislation and statutes, legislative intent, regulations, rulings, and case law) and their applicability to the facts and circumstances of the tax position. If a tax position does not meet the more-likely-than-not recognition threshold, the benefit of that position is not recognized in the financial statements. The second step is measurement. A tax position that meets the more-likely-than-not recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. The tax position is measured as the largest amount of benefit that is greater than 50% likely of being realized upon ultimate resolution with a taxing authority. | ||
Unrecognized tax benefits | $ 5,900 | ||
Accrual interest and penalties | $ 0 | $ 0 | |
Minimum [Member] | |||
Income Tax Disclosure [Line Items] | |||
Income tax Realization | 50.00% | ||
Federal [Member] | |||
Income Tax Disclosure [Line Items] | |||
Research and development tax credits carryforwards | $ 4,100 | ||
Tax credit carryforward, expiration date | 2,026 | ||
California [Member] | |||
Income Tax Disclosure [Line Items] | |||
Research and development tax credits carryforwards | $ 4,600 | ||
State and Local [Member] | |||
Income Tax Disclosure [Line Items] | |||
Tax credit carryforward, expiration date | 2,016 |
Income Taxes - Schedule of Unre
Income Taxes - Schedule of Unrecognized Tax Benefits (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||
Gross unrecognized tax benefits at the beginning of the year | $ 7,594 | $ 3,539 | $ 1,912 |
Increases related to current year positions | 580 | 474 | 476 |
Increases (decreases) related to prior year positions | (7) | 3,581 | 1,151 |
Expiration of unrecognized tax benefits | 0 | 0 | 0 |
Gross unrecognized tax benefits at the end of the year | $ 8,167 | $ 7,594 | $ 3,539 |
Collaborations - Additional Inf
Collaborations - Additional Information (Detail) $ in Millions | 12 Months Ended | |||||
Dec. 31, 2016USD ($)$ / IntegratedSystem | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2012USD ($) | Feb. 29, 2016USD ($) | Sep. 30, 2015USD ($) | |
DexCom Agreement [Member] | ||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||||
Reimbursement of development costs | $ 1 | |||||
Additional research and development expense upon FDA approval | $ 1 | |||||
Additional payment upon achievement of milestones | $ 1 | |||||
Commit for incremental marketing activities | $ / IntegratedSystem | 100 | |||||
Marketing fund commitment amount | $ 0.7 | $ 0.4 | ||||
Marketing funds commitment utilized | 0.4 | 0 | ||||
Marketing fund liability amount | 0.7 | 0.4 | ||||
JDRF Agreement [Member] | ||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||||
Research and development offset cumulative amount | 0.5 | |||||
Aggregate amount of milestone payment achievements | $ 0.7 | |||||
JDRF Agreement [Member] | Maximum [Member] | ||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||||
Research and development offset cumulative amount | $ 3 | |||||
JDRF Termination Agreement [Member] | ||||||
Collaborative Arrangements And Noncollaborative Arrangement Transactions [Line Items] | ||||||
Repayment of milestone payments received | $ 0.7 |
Employee-Benefits - Additional
Employee-Benefits - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items] | ||
Minimum age of employees for defined contribution plan | 18 years | |
Total liabilities | $ 378 | $ 222 |
Mutual funds held for nonqualified deferred compensation plan participants [Member] | ||
Defined Benefit Plans And Other Postretirement Benefit Plans Table Text Block [Line Items] | ||
Total assets | $ 378 | $ 222 |
Commitments and Contingencies65
Commitments and Contingencies - Schedule of Future Minimum Payments Under Noncancelable Operating Leases (Detail) $ in Thousands | Dec. 31, 2016USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2,017 | $ 3,198 |
2,018 | 3,630 |
2,019 | 1,899 |
2,020 | 643 |
2,021 | 662 |
Thereafter | 1,323 |
Total | $ 11,355 |
Selected Quarterly Financial 66
Selected Quarterly Financial Data (Unaudited) (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||||||||||||||||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||||||||||||||||||
Revenue | $ 28,912 | $ 12,293 | $ 22,985 | $ 20,058 | $ 29,120 | $ 15,716 | $ 15,706 | $ 12,308 | $ 17,889 | $ 13,513 | $ 10,254 | $ 8,066 | $ 67,306 | $ 55,336 | $ 84,248 | $ 72,850 | $ 49,722 | ||||||||||||||
Gross profit | 10,065 | (1,577) | 8,176 | 6,927 | 13,458 | 5,513 | 4,801 | 2,808 | 6,537 | 4,396 | 3,448 | 867 | 26,626 | 13,527 | 23,592 | 26,580 | 15,248 | ||||||||||||||
Operating expenses | 23,411 | 26,837 | 25,229 | 26,166 | 24,679 | 24,216 | 23,472 | 23,218 | 24,039 | 23,403 | 21,766 | 21,704 | 79,987 | 78,232 | 101,643 | 95,584 | 90,912 | ||||||||||||||
Operating loss | (13,346) | (28,414) | (17,053) | (19,239) | (11,221) | (18,703) | (18,671) | (20,410) | (17,502) | (19,007) | (18,318) | (20,837) | (53,361) | (64,705) | (78,051) | (69,004) | (75,664) | ||||||||||||||
Net loss | $ (14,822) | $ (29,815) | $ (18,326) | $ (20,485) | $ (12,093) | $ (19,585) | $ (19,533) | $ (21,208) | $ (18,465) | $ (19,901) | $ (19,197) | $ (21,961) | $ (61,627) | $ (68,624) | $ (83,447) | $ (72,418) | $ (79,524) | ||||||||||||||
Basic and diluted net loss per share | $ (4.80) | [1] | $ (9.70) | [1] | $ (6) | [1] | $ (6.80) | [1] | $ (4) | [1] | $ (6.50) | [1] | $ (6.50) | [1] | $ (8.30) | [1] | $ (7.80) | [1] | $ (8.50) | [1] | $ (8.30) | [1] | $ (9.60) | [1] | $ (13.79) | [2] | $ (22.52) | [2] | $ (27.30) | $ (25.04) | $ (34.17) |
[1] | Net loss per share is computed independently for each of the quarters presented. Therefore, the sum of the quarterly per-share calculations will not necessarily equal the annual per share calculation. | ||||||||||||||||||||||||||||||
[2] | The issued and outstanding shares of common stock have been restated for all periods presented to reflect the effects of the 1-for-10 reverse stock split, which was effective on October 9, 2017 as described in Note 7. |