Document And Entity Information
Document And Entity Information | 9 Months Ended |
Sep. 30, 2015 | |
Document Information [Line Items] | |
Entity Registrant Name | WRIGHT MEDICAL GROUP N.V. |
Entity Central Index Key | 1,492,658 |
Current Fiscal Year End Date | --12-27 |
Entity Well-known Seasoned Issuer | No |
Entity Voluntary Filers | No |
Entity Current Reporting Status | Yes |
Entity Filer Category | Large Accelerated Filer |
Document Fiscal Year Focus | 2,015 |
Document Fiscal Period Focus | Q3 |
Document Type | 8-K |
Document Period End Date | Sep. 30, 2015 |
Amendment Flag | false |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 254,435 | $ 227,326 |
Marketable securities | 0 | 2,575 |
Accounts receivable, net | 51,713 | 57,190 |
Inventories | 111,064 | 88,412 |
Prepaid expenses | 8,611 | 11,161 |
Deferred income taxes | 4,007 | 3,437 |
Other current assets | 32,045 | 50,355 |
Total current assets | 461,875 | 440,456 |
Property, plant and equipment, net | 122,450 | 104,235 |
Goodwill | 190,568 | 190,966 |
Intangible assets, net | 68,308 | 69,025 |
Deferred income taxes | 736 | 815 |
Other assets | 121,598 | 87,179 |
Total assets | 965,535 | 892,676 |
Current liabilities: | ||
Accounts payable | 18,261 | 16,729 |
Accrued expenses and other current liabilities | 79,345 | 170,204 |
Current portion of long-term obligations | 784 | 718 |
Total current liabilities | 98,390 | 187,651 |
Long-term debt and capital lease obligations | 565,556 | 280,612 |
Deferred income taxes | 14,591 | 11,566 |
Other liabilities | 173,027 | 134,044 |
Total liabilities | $ 851,564 | $ 613,873 |
Commitments and contingencies (Note 12) | ||
Stockholders' equity: | ||
Common stock, $.01 par value, authorized: 100,000,000 shares; issued and outstanding: 49,888,296 shares at March 31, 2014 and 47,993,765 shares at December 31, 2013 | $ 512 | $ 509 |
Additional paid-in capital | 786,443 | 751,061 |
Accumulated other comprehensive income | (4,895) | 2,398 |
Retained earnings | (668,089) | (475,165) |
Total stockholders' equity | 113,971 | 278,803 |
Total liabilities and stockholders' equity | $ 965,535 | $ 892,676 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets Parenthetical - $ / shares | Sep. 30, 2015 | Dec. 31, 2014 |
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | ||
Common Stock, Par or Stated Value Per Share (in dollars per share) | $ 0.01 | $ 0.01 |
Common Stock, Shares Authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, issued and outstanding (in shares) | 51,471,807 | 51,326,696 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |||
Net sales | $ 80,139 | $ 71,307 | $ 238,493 | $ 214,733 | ||
Cost of sales | 23,052 | [1] | 16,703 | [1] | 63,812 | 54,126 |
Gross profit | 57,087 | 54,604 | 174,681 | 160,607 | ||
Operating expenses: | ||||||
Selling, general and administrative | 85,997 | [1] | 66,926 | [1] | 250,801 | 207,629 |
Research and development | 9,570 | [1] | 5,948 | [1] | 24,644 | 18,603 |
Amortization of intangible assets | 2,562 | 2,379 | 7,741 | 7,241 | ||
Total operating expenses | 98,129 | 75,253 | 283,186 | 233,473 | ||
Operating (loss) income | (41,042) | (20,649) | (108,505) | (72,866) | ||
Interest Expense Income, Net | 11,185 | 4,565 | 29,793 | 12,873 | ||
Other (income) expense, net | 10,236 | 21,430 | 7,395 | 54,986 | ||
Loss from continuing operations before income taxes | (62,463) | (46,644) | (145,693) | (140,725) | ||
Benefit for income taxes | 187 | 3,003 | 511 | (7,197) | ||
Loss from Continuing Operations Attributable to Parent | (62,650) | (49,647) | (146,204) | (133,528) | ||
(Loss) Income from Discontinued Operations, Net of Tax, Attributable to Parent | (36,211) | (12,160) | (46,720) | (14,925) | ||
Net (loss) income | $ (98,861) | $ (61,807) | $ (192,924) | $ (148,453) | ||
Net (loss) income per share (Note 11): | ||||||
(Loss) income from Continuing Operations, Per Basic Share | $ (1.22) | $ (0.99) | $ (2.86) | $ (2.70) | ||
(Loss) income from Continuing Operations, Per Diluted Share | (1.22) | (0.99) | (2.86) | (2.70) | ||
Basic (in dollars per share) | (1.93) | (1.24) | (3.78) | (3) | ||
Diluted (in dollars per share) | $ (1.93) | $ (1.24) | $ (3.78) | $ (3) | ||
Weighted-average number of shares outstanding-basic (in shares) | 51,172 | 50,043 | 51,033 | 49,441 | ||
Weighted-average number of shares outstanding, diluted (in shares) | 51,172 | 50,043 | 51,033 | 49,441 | ||
[1] | These line items include the following amounts of non-cash, stock-based compensation expense for the periods indicated: Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014Cost of sales$17 $43 $28 $231Selling, general and administrative1,777 2,522 6,895 7,932Research and development231 304 783 805 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Operations Parenthetical - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Stock-based compensation expense | $ 7,706 | $ 8,968 | ||
Cost of sales [Member] | ||||
Stock-based compensation expense | $ 17 | $ 43 | 28 | 231 |
Selling, general and administrative [Member] | ||||
Stock-based compensation expense | 1,777 | 2,522 | 6,895 | 7,932 |
Research and Development Expense [Member] | ||||
Stock-based compensation expense | $ 231 | $ 304 | $ 783 | $ 805 |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Net (loss) income | $ (98,861) | $ (61,807) | $ (192,924) | $ (148,453) |
Other comprehensive income (loss), net of tax: | ||||
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax | (1,581) | (11,034) | (7,293) | (11,636) |
Other Comprehensive Income (Loss), Unrealized Holding Gain (Loss) on Securities Arising During Period, Net of Tax | 0 | (1) | 0 | 2 |
Reclassification of gain on equity securities, net of taxes of $1 and $3,041, respectively | 2 | |||
Other Comprehensive Income (Loss), Pension and Other Postretirement Benefit Plans, Adjustment, Net of Tax | 0 | 0 | 0 | (344) |
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Reclassification Adjustment from AOCI, Realized upon Sale or Liquidation, Net of Tax | 0 | 0 | 0 | 2,628 |
Other Comprehensive Income (Loss), Net of Tax | (1,581) | (11,035) | (7,293) | (9,350) |
Comprehensive (loss) income | $ (100,442) | $ (72,842) | $ (200,217) | $ (157,803) |
Condensed Consolidated Stateme7
Condensed Consolidated Statements of Comprehensive Income Parenthetical - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Statement of Comprehensive Income [Abstract] | ||||
Other Comprehensive Income (Loss), Unrealized Holding Gain (Loss) on Securities Arising During Period, Tax | $ 0 | $ 1 | $ 0 | $ 1 |
Condensed Consolidated Stateme8
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Operating activities: | ||
Net (loss) income | $ (192,924) | $ (148,453) |
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||
Depreciation | 16,966 | 13,617 |
Stock-based compensation expense | 7,706 | 8,968 |
Consolidated Intangible Amortization | 7,741 | 7,241 |
Amortization of deferred financing costs and debt discounts | 20,175 | 8,162 |
Write off of Deferred Debt Issuance Cost | (24,746) | 0 |
Deferred income taxes | 2 | 2,268 |
Excess tax benefit from stock-based compensation arrangements | 0 | 59 |
Non Cash Adjustment Derivative Fair Value | (12,022) | 2,000 |
Discontinued Operation, Gain (Loss) from Disposal of Discontinued Operation, before Income Tax | (80) | (24,277) |
Mark-to-market adjustment for CVRs (Note 1) | (7,290) | 51,294 |
Loss Contingency, Receivable, Period Increase (Decrease) | 25,000 | |
Other | 4,845 | 1,537 |
Changes in assets and liabilities (net of acquisitions): | ||
Accounts receivable | 2,878 | (8,475) |
Inventories | (22,784) | (12,472) |
Prepaid expenses and other assets | (2,872) | (13,825) |
Accounts payable | 1,866 | 18,594 |
Accrued expenses and other liabilities | 12,191 | 7,728 |
Payment of Contingent Consideration | (27,983) | |
Net cash provided by operating activities | (141,839) | (86,152) |
Investing activities: | ||
Capital expenditures | (34,013) | (35,706) |
Acquisition of businesses (Note 2) | (4,905) | (80,556) |
Purchase of intangible assets | (82) | (2,761) |
Sales and maturities of available-for-sale marketable securities | 2,566 | 11,245 |
Proceeds from Divestiture of Businesses | 0 | 274,687 |
Net cash used in investing activities | (36,434) | 166,909 |
Financing activities: | ||
Issuance of common stock | 3,084 | 26,376 |
Proceeds from Issuance of Warrants | 86,400 | 0 |
Derivative, Cost of Hedge | (144,843) | 0 |
Payments for Repurchase of Warrants | (59,803) | 0 |
Settlement of 2017 Notes Conversion Derivative | (49,152) | 0 |
Proceeds from Hedge, Financing Activities | 69,764 | 0 |
Proceeds from Convertible Debt | 632,500 | 0 |
Repayments of Convertible Debt | (240,000) | 0 |
Payments of deferred financing and equity issuance costs | (20,081) | 0 |
Payments of capital leases | (530) | (260) |
Excess tax benefit from stock-based compensation arrangements | 0 | 59 |
Payment of contingent consideration - initial valuation | (70,120) | |
Net cash provided by (used in) financing activities | 207,219 | 26,175 |
Effect of exchange rates on cash and cash equivalents | (1,837) | (2,636) |
Net increase in cash and cash equivalents | 27,109 | 104,296 |
Consolidated Cash and Equivalents, beginning of period | 227,326 | $ 168,735 |
Consolidated Cash and Equivalents, end of period | 254,435 | |
2017 Notes Conversion Derivative [Member] | ||
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||
Write off of Deferred Debt Issuance Cost | (24,700) | |
BMTI Payment of Conditional Value Rights [Member] | ||
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||
Mark-to-market adjustment for CVRs (Note 1) | $ 98,100 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Presentation. The unaudited condensed consolidated interim financial statements of Wright Medical Group, Inc. (WMG, legacy Wright, we, us, or our) have been prepared in accordance with accounting principles generally accepted (GAAP) in the United States (U.S.) for interim financial statements. Accordingly, these unaudited condensed consolidated interim financial statements should be read in conjunction with our consolidated financial statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, 2014 , as filed with the U.S. Securities and Exchange Commission (SEC) on February 26, 2015. On October 1, 2015, we completed our previously announced merger with Tornier N.V. (Tornier). See Note 14 to the consolidated financial statements for additional information regarding the merger. In the opinion of management, these unaudited condensed consolidated interim financial statements reflect all adjustments necessary for a fair presentation of our interim financial results. All such adjustments are of a normal and recurring nature. The results of operations for any interim period are not indicative of results for the full fiscal year. The accompanying unaudited condensed consolidated interim financial statements include our accounts and those of our domestic and international subsidiaries, all of which are wholly-owned subsidiaries. Intercompany accounts and transactions have been eliminated in consolidation. The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities at the dates of the financial statements and the amounts of revenues and expenses during the reporting periods. Actual amounts realized or paid could differ from those estimates. Fair Value of Financial Instruments. The carrying values of cash and cash equivalents, accounts receivable, and accounts payable approximate the fair values of these financial instruments as of September 30, 2015 and December 31, 2014 due to their short maturities or variable rates. The outstanding $632.5 million of our 2.00% Convertible Senior Notes maturing in 2020 (2020 Notes) are carried at cost, net of unamortized discount. The estimated fair value of the 2020 Notes was approximately $605.4 million at September 30, 2015 , based on a quoted price in an active market (Level 1). The remaining outstanding $60 million of our 2.00% Convertible Senior Notes maturing in 2017 (2017 Notes) are carried at cost, net of unamortized discount. The estimated fair value of the 2017 Notes was approximately $63.6 million at September 30, 2015 , based on a quoted price in an active market (Level 1). Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 820, Fair Value Measurement, requires fair value measurements be classified and disclosed in one of the following three categories: Level 1: Financial instruments with unadjusted, quoted prices listed on active market exchanges. Level 2: Financial instruments determined using prices for recently traded financial instruments with similar underlying terms as well as directly or indirectly observable inputs, such as interest rates and yield curves that are observable at commonly quoted intervals. Level 3: Financial instruments that are not actively traded on a market exchange. This category includes situations where there is little, if any, market activity for the financial instrument. The prices are determined using significant unobservable inputs or valuation techniques. We use a third-party provider to determine fair values of our available-for-sale debt securities. The third-party provider receives market prices for each marketable security from a variety of industry standard data providers, security master files from large financial institutions and other third-party sources with reasonable levels of price transparency. The third-party provider uses these multiple prices as inputs into a pricing model to determine a weighted average price for each security. We have controls in place to review the third party provider's qualifications and procedures used to determine fair values and to validate the prices used in their determination of fair value. We classify our investment in U.S. Treasury bills and bonds and corporate equity securities as Level 1 based upon quoted prices in active markets. All other marketable securities are classified as Level 2 based upon the other than quoted prices with observable market data. These include U.S. agency debt securities, certificates of deposit, commercial paper, and corporate debt securities. During the third quarter of 2012, we issued $300 million of the 2017 Notes, and we recorded a derivative liability for the conversion feature (2017 Notes Conversion Derivative) of such 2017 Notes. Additionally, we entered into convertible notes hedging transactions (2017 Notes Hedges) in connection with the issuance of our 2017 Notes. On February 13, 2015, in connection with our issuance of the $632.5 million of the 2020 Notes, we used approximately $292 million of the net proceeds from the offering to repurchase approximately $240 million aggregate principal amount of our outstanding 2.00% cash convertible senior notes due 2017 in privately negotiated transactions, and settled all of the 2017 Notes Hedges. The 2017 Notes Conversion Derivative is measured at fair value using Level 3 inputs. These instruments are not actively traded and are valued using an option pricing model that uses observable and unobservable market data for inputs. On February 13, 2015, we issued $632.5 million of the 2020 Notes, and we have recorded a derivative liability for the conversion feature (2020 Notes Conversion Derivative) of such 2020 Notes. Additionally, we entered into convertible notes hedging transactions (2020 Notes Hedges) in connection with the issuance of the 2020 Notes. The 2020 Notes Hedges and the 2020 Notes Conversion Derivative are measured at fair value using Level 3 inputs. These instruments are not actively traded and are valued using an option pricing model that uses observable and unobservable market data for inputs. To determine the fair value of the embedded conversion option in the 2017 Notes Conversion Derivative and 2020 Notes Conversion Derivative, a trinomial lattice model was used. A trinomial stock price lattice generates three possible outcomes of stock price - one up, one down, and one stable. This lattice generates a distribution of stock prices at the maturity date and throughout the life of the 2017 Notes and 2020 Notes. Using this stock price lattice, a convertible note lattice was created where the value of the embedded conversion option was estimated by comparing the value produced in a convertible note lattice with the option to convert against the value without the ability to convert. In each case, the convertible note lattice first calculates the possible convertible note values at the maturity date, using the distribution of stock prices, which equals to the maximum of (x) the remaining bond cash flows and (y) stock price times the conversion price. The values of the 2017 Notes Conversion Derivative and 2020 Notes Conversion Derivative at the valuation date was estimated using the values at the maturity date and moving back in time on the lattices (both for the lattice with the conversion option and without the conversion option). Specifically, at each node, if the 2017 Notes or 2020 Notes are eligible for early conversion, the value at this node is the maximum of (i) converting to stock, which is the stock price times the conversion price, and (ii) holding onto the 2017 Notes and 2020 Notes, which is the discounted and probability-weighted value from the three possible outcomes at the future nodes plus any accrued but unpaid coupons that are not considered at the future nodes. If the 2017 Notes or 2020 Notes are not eligible for early conversion, the value of the conversion option at this node equals to (ii). In the lattice, a credit adjustment was applied to the discount for each cash flow in the model as the embedded conversion option, as well as the coupon and notional payments, is settled with cash instead of shares. To estimate the fair value of the 2020 Notes Hedges, we used the Black-Scholes formula combined with credit adjustments, as the bank counterparties have credit risk and the call options are cash settled. We assumed that the call options will be exercised at the maturity since our common stock does not pay any dividends and management does not expect to declare dividends in the near term. The following assumptions were used in the fair market valuations of the 2017 Notes Conversion Derivative and 2020 Notes Conversion Derivative and 2020 Notes Hedges as of September 30, 2015 : 2017 Notes Conversion Derivative 2020 Notes Conversion Derivative 2020 Notes Hedge Stock Price Volatility (1) 43 % 43 % 43 % Credit Spread for Wright (2) 5.4 % 6.4 % NA Credit Spread for Deutsche Bank AG (3) N/A N/A 0.9 % Credit Spread for Wells Fargo Securities, LLC (3) N/A N/A 0.5 % Credit Spread for JPMorgan Chase Bank (3) N/A N/A 0.7 % (1) Volatility selected based on historical and implied volatility of common shares of Wright Medical Group, Inc. (2) Credit spread implied from traded price. (3) Credit spread of each bank is estimated using CDS curves. Source: Bloomberg. As part of the acquisitions of EZ Concepts Surgical Device Corporation, d/b/a EZ Frame TM and CCI ® Evolution Mobile Bearing Total Ankle Replacement system (CCI acquisition), completed in 2010 and 2011, respectively, we have recorded $0.2 million of contingent liabilities for potential future cash payments related to these transactions as of September 30, 2015 . The fair value of the contingent consideration associated with each of the acquisitions noted above as of September 30, 2015 , was determined using a discounted cash flow model and probability adjusted estimates of the future earnings and is classified in Level 3. As part of the acquisition of WG Healthcare in 2013, we have recorded contingent consideration of approximately $1.6 million as of September 30, 2015 . The fair value of the contingent consideration associated with this acquisition as of September 30, 2015 , was determined using a discounted cash flow model, utilizing a 12% discount rate and probability adjusted estimates of the future earnings and is classified in Level 3. As part of the acquired sales and distribution business of Surgical Specialties Australia Pty. Ltd, in 2015, we have recorded contingent consideration of approximately $1.5 million as of September 30, 2015 . The fair value of the contingent consideration associated with this acquisition as of September 30, 2015 , was determined using a discounted cash flow model, utilizing a 14% discount rate and probability adjusted estimates of the future earnings and is classified in Level 3. On March 1, 2013, as part of the acquisition of BioMimetic Therapeutics, Inc. (BioMimetic), we issued Contingent Value Rights (CVRs) as part of the merger consideration. Each CVR entitles its holder to receive additional cash payments of up to $6.50 per share, which were payable upon receipt of Food and Drug Administration (FDA) approval of Augment ® Bone Graft and upon achieving certain revenue milestones. On September 1, 2015, Augment ® Bone Graft received FDA approval and the first of the milestone payments associated with the CVRs was paid out at $3.50 per share, which totaled $98.1 million . The fair value of the CVRs outstanding at September 30, 2015 of $28.6 million was determined using the closing price of the security in the active market (Level 1). For the three and nine months ended September 30, 2015 , the change in the value of the CVRs resulted in a $14.6 million loss and $7.3 million gain, respectively. For the three and nine months ended September 30, 2014 , the change in the value of the CVRs resulted in a loss of $18.5 million and $51.3 million , respectively. Changes in the fair value of contingent consideration are recorded in "Other (income) expense, net" in our condensed consolidated statements of operations. The following table summarizes the valuation of our financial instruments measured at fair value on a recurring basis (in thousands): Total Quoted Prices Prices with Prices with At September 30, 2015 Assets Cash and cash equivalents $ 254,435 $ 254,435 $ — $ — Available-for-sale marketable securities Corporate debt securities — — — — U.S. government debt securities — — — — Total available-for-sale marketable securities — — — — 2020 Notes Hedges 102,226 — — 102,226 Total $ 356,661 $ 254,435 $ — $ 102,226 Liabilities 2017 Notes Conversion Derivative $ 8,143 $ — $ — $ 8,143 2020 Notes Conversion Derivative 103,615 — — 103,615 Contingent consideration 3,303 — — 3,303 Contingent consideration (CVR) 28,590 28,590 — — Total $ 143,651 $ 28,590 $ — $ 115,061 Total Quoted Prices Prices with Prices with At December 31, 2014 Assets Cash and cash equivalents $ 227,326 $ 227,326 $ — $ — Available-for-sale marketable securities Corporate debt securities 566 — 566 — U.S. Government debt securities 2,009 2,009 — — Total available-for-sale marketable securities 2,575 2,009 566 — 2017 Notes Hedges 80,000 — — 80,000 Total $ 309,901 $ 229,335 $ 566 $ 80,000 Liabilities 2017 Notes Conversion Derivative $ 76,000 $ — $ — $ 76,000 Contingent consideration 1,705 — — 1,705 Contingent consideration (CVR) $ 133,981 133,981 $ — $ — Total $ 211,686 $ 133,981 $ — $ 77,705 The following is a roll forward of our assets and liabilities measured at fair value on a recurring basis using unobservable inputs (Level 3): Balance at December 31, 2014 Additions Transfers into Level 3 Gain/(Losses) included in Earnings Currency Settlements Balance at September 30, 2015 2017 Notes Hedges $ 80,000 — — (10,236 ) — (69,764 ) $ — 2017 Notes Conversion Derivative $ (76,000 ) — — 18,705 — 49,152 $ (8,143 ) 2020 Notes Hedges $ — 144,843 — (42,617 ) — — $ 102,226 2020 Notes Conversion Derivative $ — (149,784 ) — 46,169 — — $ (103,615 ) Contingent Consideration $ (1,705 ) (1,501 ) — (144 ) 47 — $ (3,303 ) |
Discontinued Operations (Notes)
Discontinued Operations (Notes) | 9 Months Ended |
Sep. 30, 2015 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Disposal Groups, Including Discontinued Operations, Disclosure [Text Block] | Discontinued Operations On January 9, 2014, we completed our divestiture and sale of the OrthoRecon business to MicroPort Scientific Corporation (MicroPort). Pursuant to the terms of the asset purchase agreement (Purchase Agreement), the purchase price (as defined in the Purchase Agreement) for the OrthoRecon business was approximately $283 million (including a working capital adjustment), which MicroPort paid in cash. As a result of the transaction, we recognized approximately $24.3 million as the gain on disposal of the OrthoRecon business, before the effect of income taxes for the year ended December 31, 2014. All current and historical operating results for the OrthoRecon business are reflected within discontinued operations in the condensed consolidated financial statements. In addition, costs associated with corporate employees and infrastructure transferred as a part of the sale were included in discontinued operations. The following table summarizes the results of discontinued operations (in thousands, except per share data): Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 Revenue $ — $ — $ — $ 3,056 Loss before tax (including $24.3 million gain from disposal in 2014) (36,211 ) (18,137 ) (46,720 ) (7,121 ) Income tax benefit — (5,977 ) — 7,804 Loss from discontinued operations, net of tax (36,211 ) (12,160 ) (46,720 ) (14,925 ) Net loss from discontinued operations per share ( Note11 ): Basic $ (0.71 ) $ (0.24 ) $ (0.92 ) $ (0.30 ) Diluted $ (0.71 ) $ (0.24 ) $ (0.92 ) $ (0.30 ) Weighted-average number of shares outstanding-basic 51,172 50,043 51,033 49,441 Weighted-average number of shares outstanding-diluted 51,172 50,043 51,033 49,441 During the three months ended September 30, 2015, we recognized a $25 million charge to write down an insurance receivable associated with product liability claims. Additionally, during the three months ended September 30, 2015, we increased our estimated product liability by approximately $4 million for claims that had been incurred in prior periods. We have analyzed the impact of this adjustment and determined that this out-of-period charge did not have a material impact to the prior period or current period financial statements. See Note 12 for additional information regarding our product liabilities and the associated insurance. The 2014 effective tax rate within the results of discontinued operations reflects the sale of non-deductible goodwill of $25.8 million associated with the OrthoRecon business. Certain liabilities associated with the OrthoRecon business, including product liability claims associated with hip and knee products sold prior to the closing, were not assumed by MicroPort. Charges associated with these product liability claims, including legal defense, settlements and judgments, income associated with product liability insurance recoveries, and changes to any contingent liabilities associated with the OrthoRecon business have been reflected within results of discontinued operations, and we will continue to reflect these within results of discontinued operations in future periods. We will incur continuing cash outflows associated with legal defense costs and the ultimate resolution of these contingent liabilities, net of insurance proceeds, until these liabilities are resolved. |
Inventories
Inventories | 9 Months Ended |
Sep. 30, 2015 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories consist of the following (in thousands): September 30, December 31, Raw materials $ 7,768 $ 6,910 Work-in-process 16,806 13,849 Finished goods 86,490 67,653 $ 111,064 $ 88,412 During the quarter ended September 30, 2015, we recorded a $2.1 million charge to Cost of sales to recognize the loss of inventory associated with our U.S. distributor transitions following distributor conversions associated with our direct sales initiative, our OrthoRecon divestiture and our recent acquisitions prior to 2015. We have analyzed the impact of this adjustment and determined that this out-of-period charge did not have a material impact to the prior period or current period financial statements. |
Marketable Securities
Marketable Securities | 9 Months Ended |
Sep. 30, 2015 | |
Marketable Securities [Abstract] | |
Marketable Securities | Marketable Securities Our investments in marketable securities are classified as available-for-sale securities in accordance with ASC Topic 320, Investments — Debt and Equity Securities . These securities are carried at their fair value, and all unrealized gains and losses are recorded within other comprehensive income. Marketable securities are classified as current for those expected to mature or be sold within 12 months and the remaining portion is classified as non-current. The cost of investment securities sold is determined by the specific identification method. As of September 30, 2015 , we had no marketable securities. As of December 31, 2014 , we had current marketable securities totaling $2.6 million , respectively, consisting of investments in corporate and government bonds, all of which were valued at fair value using a market approach. The following tables present a summary of our marketable securities as of December 31, 2014 (in thousands): Amortized Cost Gross Gross Estimated At December 31, 2014 Available-for-sale marketable securities Corporate debt securities 566 — — 566 U.S. government debt securities 2,009 — — 2,009 Total available-for-sale marketable securities $ 2,575 $ — $ — $ 2,575 |
Property, Plant and Equipment,
Property, Plant and Equipment, Net | 9 Months Ended |
Sep. 30, 2015 | |
Property, Plant and Equipment, Net [Abstract] | |
Property, Plant and Equipment, Net | Property, Plant and Equipment, Net Property, plant and equipment consist of the following (in thousands): September 30, December 31, Property, plant and equipment, at cost $ 221,602 $ 191,094 Less: Accumulated depreciation (99,152 ) (86,859 ) $ 122,450 $ 104,235 |
Long-Term Debt and Capital Leas
Long-Term Debt and Capital Lease Obligations | 9 Months Ended |
Sep. 30, 2015 | |
Long-term Debt and Capital Lease Obligations [Abstract] | |
Long Term Debt and Capital Lease Obligations | Long-Term Debt and Capital Lease Obligations Long-term debt and capital lease obligations consist of the following (in thousands): September 30, December 31, Capital lease obligations $ 12,197 $ 8,678 2017 Notes 55,999 272,652 2020 Notes 498,144 — 566,340 281,330 Less: current portion (784 ) (718 ) $ 565,556 $ 280,612 2017 Notes On August 31, 2012, we issued $300 million aggregate principal amount of the 2017 Notes pursuant to an indenture, dated as of August 31, 2012 between us and The Bank of New York Mellon Trust Company, N.A., as Trustee. The 2017 Notes will mature on August 15, 2017 , and we pay interest on the 2017 Notes semi-annually on each February 15 and August 15 at an annual rate of 2.00% . We may not redeem the 2017 Notes prior to the maturity date, and no “sinking fund” is available for the 2017 Notes, which means that we are not required to redeem or retire the 2017 Notes periodically. The 2017 Notes are convertible at the option of the holder, during certain periods and subject to certain conditions as described below, solely into cash at an initial conversion rate of 39.3140 shares of our common stock per $1,000 principal amount of the 2017 Notes, subject to adjustment upon the occurrence of specified events, which represents an initial conversion price of $25.44 per share. The completion of the merger with Tornier will result in an adjustment to the underlying shares and conversion price. The holder of the 2017 Notes may convert their notes at any time prior to February 15, 2017 only under the following circumstances: (1) during any calendar quarter commencing after the calendar quarter ending December 31, 2012 (and only during such calendar quarter), if the last reported sale price of our common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day; (2) during the five business day period after any five consecutive trading day period in which the trading price per $1,000 principal amount of notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of our common stock and the conversion rate on each such trading day; or (3) upon the occurrence of specified corporate events, including during the period beginning 35 scheduled trading days prior to the anticipated effective date of our proposed merger with Tornier N.V. "Tornier" and ending 35 trading days after the actual effective date of such merger. While we currently do not expect significant conversions because the notes currently trade at a premium to the as-converted value, and a converting holder would forego future interest payments, any conversions would reduce our cash resources. On or after February 15, 2017 until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert their 2017 Notes solely into cash, regardless of the foregoing circumstances. Upon conversion, a holder will receive an amount in cash, per $1,000 principal amount of the 2017 Notes, equal to the settlement amount as calculated under the indenture relating to the 2017 Notes. If we undergo a fundamental change, as defined in the indenture relating to the 2017 Notes, subject to certain conditions, holders of the 2017 Notes will have the option to require us to repurchase for cash all or a portion of their notes at a purchase price equal to 100% of the principal amount of the 2017 Notes to be repurchased, plus any accrued and unpaid interest to, but excluding, the fundamental change repurchase date, as defined in the indenture relating to the 2017 Notes. In addition, following certain corporate transactions, we, under certain circumstances, will pay a cash make-whole premium by increasing the applicable conversion rate for a holder that elects to convert its 2017 Notes in connection with such corporate transaction. The 2017 Notes are senior unsecured obligations that rank: (i) senior in right of payment to any of our indebtedness that is expressly subordinated in right of payment to the 2017 Notes; (ii) equal in right of payment to any of our unsecured indebtedness that is not so subordinated; (iii) effectively junior in right of payment to any secured indebtedness to the extent of the value of the assets securing such indebtedness; and (iv) structurally junior to all indebtedness and other liabilities (including trade payables) of our subsidiaries. In conjunction with the issuance of the 2017 Notes, we recognized deferred financing charges of approximately $8.8 million , which are being amortized over the term of the 2017 Notes using the effective interest method. The 2017 Notes Conversion Derivative requires bifurcation from the 2017 Notes in accordance with ASC Topic 815, Derivatives and Hedging, and is accounted for as a derivative liability. The fair value of the 2017 Notes Conversion Derivative at the time of issuance of the 2017 Notes was $48.1 million and was recorded as original debt discount for purposes of accounting for the debt component of the 2017 Notes. This discount is amortized as interest expense using the effective interest method over the term of the 2017 Notes. For the three and nine months ended September 30, 2015 , the Company recorded $0.5 million and $2.4 million of interest expense related to the amortization of the debt discount based upon an effective rate of 6.47% . For the three and nine months ended September 30, 2014 , the Company recorded $2.3 million and $6.9 million of interest expense related to the amortization of the debt discount based upon an effective rate of 6.47% . In connection with the 2020 Notes Offering, on February 13, 2015, we purchased and extinguished $240 million aggregate principal amount of the 2017 Notes. As a result of the repurchase, we recognized approximately $24.7 million for the write off of related pro-rata unamortized deferred financing fees and debt discount within "Other expense (income), net" in our condensed consolidated statements of operations. As of September 30, 2015 , $60 million aggregate principal amount of the 2017 Notes remained outstanding and is included within long-term obligations on the consolidated balance sheet. The components of the 2017 Notes were as follows (in thousands): September 30, 2015 December 31, 2014 Principal amount of 2017 Notes $ 60,000 $ 300,000 Unamortized debt discount (4,001 ) (27,348 ) Net carrying amount of 2017 Notes $ 55,999 $ 272,652 2020 Notes On February 13, 2015, we issued $632.5 million aggregate principal amount of the 2020 Notes pursuant to an indenture, dated as of February 13, 2015 between us and The Bank of New York Mellon Trust Company, N.A., as Trustee. The 2020 Notes will pay interest semi-annually on each February 15 and August 15 at an annual rate of 2.00% , and will mature on February 15, 2020 unless earlier converted or repurchased. The 2020 Notes will be convertible, subject to certain conditions, solely into cash. The initial conversion rate for the 2020 Notes will be 32.3939 shares of our common stock (subject to adjustment as provided in the Indenture) per $1,000 principal amount of the 2020 Notes (subject to, and in accordance with, the settlement provisions of the Indenture), which is equal to an initial conversion price of approximately $30.87 per share of common stock. The completion of the merger with Tornier will result in an adjustment to the underlying shares and conversion price. In addition, within 90 days of the effective time of the merger, Wright Medical Group N.V. is obligated to execute a supplemental indenture, fully and unconditionally guaranteeing, on a senior unsecured basis, our obligations relating to the 2020 Notes. We may not redeem the 2020 Notes prior to the maturity date, and no “sinking fund” is available for the 2020 Notes, which means that we are not required to redeem or retire the 2020 Notes periodically. The holders of the 2020 Notes may convert their notes at any time prior to August 15, 2019 solely into cash, in multiples of $1,000 principal amount, upon satisfaction of one or more of the following circumstances: (1) during any calendar quarter commencing after the calendar quarter ending on March 31, 2015 (and only during such calendar quarter), if the last reported sale price of our common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day; (2) during the five business day period after any five consecutive trading day period in which the trading price per $1,000 principal amount of 2020 Notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of our common stock and the conversion rate on each such trading day; or (3) upon the occurrence of specified corporate events. Our merger with Tornier did not result in a conversion right for holders of the 2020 Notes. On or after August 15, 2019 until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert their 2020 Notes solely into cash, regardless of the foregoing circumstances. Upon conversion, a holder will receive an amount in cash, per $1,000 principal amount of the 2020 Notes, equal to the settlement amount as calculated under the indenture relating to the 2020 Notes. If we undergo a fundamental change, as defined in the indenture relating to the 2020 Notes, subject to certain conditions, holders of the 2020 Notes will have the option to require us to repurchase for cash all or a portion of their notes at a purchase price equal to 100% of the principal amount of the 2020 Notes to be repurchased, plus any accrued and unpaid interest to, but excluding, the fundamental change repurchase date, as defined in the indenture relating to the 2020 Notes. In addition, following certain corporate transactions, we, under certain circumstances, will increase the applicable conversion rate for a holder that elects to convert its 2020 Notes in connection with such corporate transaction. The 2020 Notes are senior unsecured obligations that rank: (i) senior in right of payment to any of our indebtedness that is expressly subordinated in right of payment to the 2020 Notes; (ii) equal in right of payment to any of our unsecured indebtedness that is not so subordinated; (iii) effectively junior in right of payment to any secured indebtedness to the extent of the value of the assets securing such indebtedness; and (iv) structurally junior to all indebtedness and other liabilities (including trade payables) of our subsidiaries. In conjunction with the issuance of the 2020 Notes, we recorded deferred financing charges of approximately $18 million , which are being amortized over the term of the 2020 Notes using the effective interest method. The 2020 Notes Conversion Derivative requires bifurcation from the 2020 Notes in accordance with ASC Topic 815, Derivatives and Hedging, and is accounted for as a derivative liability. The fair value of the 2020 Notes Conversion Derivative at the time of issuance of the 2020 Notes was $149.8 million and was recorded as original debt discount for purposes of accounting for the debt component of the 2017 Notes. This discount is amortized as interest expense using the effective interest method over the term of the 2017 Notes. For the three and nine months ended September 30, 2015 , we recorded $6.1 million and $15.4 million of interest expense related to the amortization of the debt discount based upon an effective rate of 8.54% . The components of the 2020 Notes were as follows (in thousands): September 30, 2015 December 31, 2014 Principal amount of 2020 Notes $ 632,500 $ — Unamortized debt discount (134,356 ) — Net carrying amount of 2020 Notes $ 498,144 $ — We entered into 2020 Notes Hedges in connection with the issuance of the 2020 Notes with three counterparties (the Option Counterparties). The 2020 Notes Hedges, which are cash-settled, are intended to reduce our exposure to potential cash payments that we would be required to make if holders elect to convert the 2020 Notes at a time when our stock price exceeds the conversion price. However, in connection with certain events, including, among others, (i) a merger other than our merger with Tornier, or other make-whole fundamental change (as defined in the 2020 Notes indenture), (ii) certain hedging disruption events, which may include changes in tax laws, an increase in the cost of borrowing our common stock in the market or other material increases in the cost to the Option Counterparties of hedging the 2020 Note Hedges and warrants, (iii) our failure to perform certain obligations under our 2020 Notes indenture or under the 2020 Notes Hedges and warrant transactions, (iv) certain payment defaults on our existing indebtedness in excess of $25 million or (v) if we or any of our significant subsidiaries become insolvent or otherwise becomes subject to bankruptcy proceedings, the Option Counterparties have the discretion to terminate the 2020 Note Hedges and warrant transactions at a value determined by them in a commercially reasonable manner, which may reduce the effectiveness of the 2020 Note Hedges or increase our obligations under the warrant transactions. In addition, the Option Counterparties have broad discretion to make certain adjustments to the 2020 Notes Hedges and warrant transactions upon the occurrence of certain other events, including, among others, (i) any adjustment to the conversion rate of our 2020 Notes, (ii) a change in law that adversely impacts the Option Counterparties’ ability to hedge their positions in our 2020 Note Hedges and warrants or (iii) upon the announcement of certain significant corporate events, including events that may give rise to a termination event as described above, such as the announcement of a third-party tender offer for more than 10% of our shares of common stock or that may have a material economic effect on the warrant transactions. Any such adjustment may also reduce the effectiveness of the 2020 Note Hedges or increase our obligations under the warrant transactions. The aggregate cost of the 2020 Notes Hedges was $144.8 million and is accounted for as a derivative asset in accordance with ASC Topic 815. See Note 7 of the condensed consolidated financial statements for additional information regarding the 2020 Notes Hedges and the 2020 Notes Conversion Derivative. We also entered into warrant transactions in which we sold warrants for an aggregate of 20.5 million shares of our common stock to the Option Counterparties, subject to adjustment. The strike price of the warrants was initially $40.00 per share, which was 59% above the last reported sale price of our common stock on February 9, 2015. The warrants are net-share settled and are exercisable over the 200 trading day period beginning on May 15, 2020. The warrant transactions will have a dilutive effect to the extent that the market value per share of our common stock during such period exceeds the applicable strike price of the warrants. Aside from the initial payment of the $144.8 million premium to the Option Counterparties, we do not expect to be required to make any cash payments to the Option Counterparties under the 2020 Notes Hedges and expect to be entitled to receive from the Option Counterparties cash, generally equal to the amount by which the market price per share of common stock exceeds the strike price of the convertible note hedging transactions during the relevant valuation period. The strike price under the 2020 Notes Hedges is equal to the conversion price of the 2020 Notes. Additionally, if the market value per share of our common stock exceeds the strike price on any day during the 200 trading day measurement period under the warrant transaction, we will be obligated to issue to the Option Counterparties a number of shares equal in value to one percent of the amount by which the then-current market value of one share of our common stock exceeds the then-effective strike price of each warrant, multiplied by the number of shares of common stock into which the 2020 Notes are then convertible at or following maturity. We will not receive any additional proceeds if warrants are exercised. Capital Leases In May 2015, the capital lease associated with our corporate headquarters building was amended to increase our occupied space, and to extend the lease term an additional 24 months with the new expiration date of October 31, 2026. The amendment resulted in a $4.0 million increase to our liability. |
Derivative Instruments and Hedg
Derivative Instruments and Hedging Activities | 9 Months Ended |
Sep. 30, 2015 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments and Hedging Activities | Derivative Instruments and Hedging Activities We account for derivatives in accordance with ASC Topic 815, which establishes accounting and reporting standards requiring that derivative instruments be recorded on the balance sheet as either an asset or liability measured at fair value. Additionally, changes in the derivative’s fair value shall be recognized currently in earnings unless specific hedge accounting criteria are met. 2017 Conversion Derivative and Notes Hedging On August 31, 2012, we issued the 2017 Notes. The 2017 Notes Conversion Derivative requires bifurcation from the 2017 Notes in accordance with ASC Topic 815, and is accounted for as a derivative liability. The fair value of the 2017 Notes Conversion Derivative at the time of issuance of the 2017 Notes was $48.1 million . See Note 6 of the condensed consolidated financial statements for additional information regarding the 2017 Notes. We also entered into the 2017 Notes Hedges in connection with the issuance of the 2017 Notes with certain counterparties. The 2017 Notes Hedges, which are cash-settled, are intended to reduce our exposure to potential cash payments that we are required to make upon conversion of the 2017 Notes in excess of the principal amount of converted notes if our common stock price exceeds the conversion price. The aggregate cost of the 2017 Notes Hedges was $56.2 million and was accounted for as a derivative asset in accordance with ASC Topic 815. On February 13, 2015, we issued $632.5 million of the 2020 Notes, which generated proceeds of approximately $613 million net of issuance costs. We used approximately $292 million of the net proceeds from this offering to repurchase and extinguish approximately $240 million aggregate principal amount of the 2017 Notes, settle the associated portion of the 2017 Notes Conversion Derivative, approximately $49 million, and to satisfy the accrued interest of $2.4 million. We also settled all of the 2017 Notes Hedges and repurchased all of the warrants associated with the 2017 Notes, generating net proceeds of approximately $10 million . See Note 6 of the condensed consolidated financial statements for additional information regarding the 2020 Notes. The following table summarizes the fair value and the presentation in the condensed consolidated balance sheet (in thousands): Location on condensed consolidated balance sheet September 30, 2015 December 31, 2014 2017 Notes Hedges Other assets $ — $ 80,000 2017 Notes Conversion Derivative Other liabilities $ 8,143 $ 76,000 Neither the 2017 Notes Conversion Derivative nor the 2017 Notes Hedges qualify for hedge accounting, thus any change in the fair value of the derivatives is recognized immediately in the condensed consolidated statements of operations. The following table summarizes the gain (loss) on changes in fair value (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 2017 Notes Hedges $ — $ (12,000 ) $ (10,236 ) $ (6,000 ) 2017 Notes Conversion Derivative 4,407 11,000 18,705 4,000 Net gain (loss) on changes in fair value $ 4,407 $ (1,000 ) $ 8,469 $ (2,000 ) 2020 Conversion Derivative and Notes Hedging On February 13, 2015, we issued the 2020 Notes. The 2020 Notes Conversion Derivative requires bifurcation from the 2020 Notes in accordance with ASC Topic 815, and is accounted for as a derivative liability. The fair value of the 2020 Notes Conversion Derivative at the time of issuance of the 2020 Notes was $149.8 million . See Note 6 of the condensed consolidated financial statements for additional information regarding the 2020 Notes. We also entered into the 2020 Notes Hedges in connection with the issuance of the 2020 Notes with the Option Counterparties. The 2020 Notes Hedges, which are cash-settled, are intended to reduce our exposure to potential cash payments that we are required to make upon conversion of the 2020 Notes in excess of the principal amount of converted notes if our common stock price exceeds the conversion price. The aggregate cost of the 2020 Notes Hedges was $144.8 million and is accounted for as a derivative asset in accordance with ASC Topic 815. Location on condensed consolidated balance sheet September 30, 2015 December 31, 2014 2020 Notes Hedges Other assets $ 102,226 $ — 2020 Notes Conversion Derivative Other liabilities $ 103,615 $ — Neither the 2020 Notes Conversion Derivative nor the 2020 Notes Hedges qualify for hedge accounting, thus any change in the fair value of the derivatives is recognized immediately in the condensed consolidated statements of operations. The following table summarizes the gain (loss) on changes in fair value (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 2020 Notes Hedges $ (21,512 ) $ — $ (42,617 ) $ — 2020 Notes Conversion Derivative 21,757 — 46,169 — Net gain on changes in fair value $ 245 $ — $ 3,552 $ — Derivatives not Designated as Hedging Instruments We employ a derivative program using 30-day foreign currency forward contracts to mitigate the risk of currency fluctuations on our intercompany receivable and payable balances that are denominated in foreign currencies. These forward contracts are expected to offset the transactional gains and losses on the related intercompany balances. These forward contracts are not designated as hedging instruments under ASC Topic 815. Accordingly, the changes in the fair value and the settlement of the contracts are recognized in the period incurred in the accompanying condensed consolidated statements of operations. At September 30, 2015 , we had no foreign currency contracts outstanding. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 9 Months Ended |
Sep. 30, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible | Goodwill and Intangible Assets Changes in the carrying amount of goodwill occurring during the nine months ended September 30, 2015 are as follows (in thousands): U.S. International BioMimetic Total Goodwill at December 31, 2014 $ 173,589 $ 16,041 $ 1,336 $ 190,966 Goodwill associated with acquisitions — 3,887 — 3,887 Foreign currency translation — (4,285 ) — (4,285 ) Goodwill at September 30, 2015 $ 173,589 $ 15,643 $ 1,336 $ 190,568 In September 2015, we acquired the sales and distribution business of Surgical Specialties Australia Pty. Ltd. Prior to the acquisition, Surgical Specialties was our exclusive sales agent in Australia. As a result of the acquisition, we now have a direct employee sales force in Australia which will be integrated with the Tornier operations. We will not record any incremental revenue as a result of the acquisition as we have historically directly billed the end customer and paid Surgical Specialties a commission. The asset purchase agreement included a $4.9 million cash payment and estimated future payments of $4.9 million , primarily related to non-competition and meeting certain financial milestones. As part of the purchase price allocation, we acquired $8.2 million of intangible assets related to customer relationships, non-competition, and settlement of the pre-existing agreement and $3.9 million of goodwill, offset by a $2.5 million deferred tax liability created as part of the transaction. The above purchase price allocation is considered preliminary and is subject to revision when the valuation of intangible assets is finalized upon receipt of the final valuation report for those assets from a third party valuation expert. Goodwill is recognized for the excess of the purchase price over the fair value of net assets of businesses acquired. Goodwill is required to be tested for impairment at least annually. Unless circumstances otherwise dictate, the annual impairment test is performed in the quarter ended December 31. The components of our identifiable intangible assets are as follows (in thousands): September 30, 2015 December 31, 2014 Cost Accumulated Amortization Cost Accumulated Amortization Indefinite life intangibles In-process research and development technology $ — $ 4,266 Tradename 3,951 4,004 Total indefinite life intangibles 3,951 8,270 Finite life intangibles Distribution channels 250 212 250 194 Completed technology 37,001 11,786 33,253 9,185 Licenses 8,233 2,128 8,234 1,637 Customer relationships 32,661 6,284 27,946 4,636 Trademarks 2,756 2,416 2,798 1,850 Non-compete agreements 8,785 3,593 8,508 3,397 Other 1,231 141 771 106 Total finite life intangibles 90,917 $ 26,560 81,760 $ 21,005 Total intangibles 94,868 90,030 Less: Accumulated amortization (26,560 ) (21,005 ) Intangible assets, net $ 68,308 $ 69,025 Based on total finite life intangible assets held at September 30, 2015 , we expect to amortize approximately $ 10.2 million for the full year of 2015, $ 8.9 million in 2016, $ 8.3 million in 2017, $ 6.6 million in 2018, and $ 6.0 million in 2019. As discussed in Note 1 , on September 1, 2015, Augment ® Bone Graft received FDA approval which resulted in a reclassification of $4.3 million from indefinite life, in-process research and development intangibles to definite life, completed technology intangibles. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Notes) | 9 Months Ended |
Sep. 30, 2015 | |
Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract] | |
Comprehensive Income (Loss) Note [Text Block] | Accumulated Other Comprehensive Income (AOCI) Other comprehensive income (OCI) includes certain gains and losses that under GAAP are included in comprehensive income but are excluded from net income as these amounts are initially recorded as an adjustment to stockholders’ equity. Amounts in OCI may be reclassified to net income upon the occurrence of certain events. Our OCI is comprised of foreign currency translation adjustments which are reclassified to net income upon sale or upon a complete or substantially complete liquidation of an investment in a foreign entity. Changes in and reclassifications out of AOCI, net of tax, for the nine months ended September 30, 2015 were as follows (in thousands): Currency Translation Adjustment (CTA) Balance December 31, 2014 $ 2,398 Other comprehensive income (loss), net of tax (7,293 ) Balance September 30, 2015 $ (4,895 ) |
Changes in Stockholders' Equity
Changes in Stockholders' Equity (Notes) | 9 Months Ended |
Sep. 30, 2015 | |
Changes in Stockholders' Equity [Abstract] | |
Stockholders' Equity Note Disclosure [Text Block] | Changes in Stockholders' Equity The below table provides an analysis of changes in each balance sheet caption of stockholders’ equity for the nine months ended September 30, 2015 and 2014 (in thousands, except share data): Nine Months Ended September 30, 2015 Common Stock Additional Paid-in Capital Retained Earnings/ (Accumulated Deficit) Accumulated Other Comprehensive Income Total Stockholders' Equity Number of Shares Amount Balance at December 31, 2014 51,326,696 $ 509 $ 751,061 $ (475,165 ) $ 2,398 $ 278,803 2015 Activity: Net loss — — — (192,924 ) — (192,924 ) Foreign currency translation — — — — (7,293 ) (7,293 ) Issuances of common stock 133,544 1 3,089 — — 3,090 Grant of non-vested shares of common stock 5,092 — — — — — Forfeitures of non-vested shares of common stock (5,695 ) — — — — — Vesting of stock-settled phantom stock and restricted stock units 12,170 2 (2 ) — — — Stock-based compensation — — 7,720 — — 7,720 Issuance of stock warrants, net of equity issuance costs — — 24,575 — — 24,575 Balance at September 30, 2015 51,471,807 $ 512 $ 786,443 $ (668,089 ) $ (4,895 ) $ 113,971 Nine Months Ended September 30, 2014 Common Stock Additional Paid-in Capital Retained Earnings/ (Accumulated Deficit) Accumulated Other Comprehensive Income Total Stockholders' Equity Number of Shares Amount Balance at December 31, 2013 47,993,765 $ 473 $ 656,770 $ (215,482 ) $ 17,953 $ 459,714 2014 Activity: Net loss — — — (148,453 ) — (148,453 ) Foreign currency translation — — — — (11,636 ) (11,636 ) Reclassification of gain on equity securities, net of taxes $1 — — — — 2 2 Minimum pension liability adjustment 1 — — — — (344 ) (344 ) CTA write-off to earnings related to liquidation of Japanese subsidiary 1 — — — — 2,628 2,628 Issuances of common stock 1,183,055 13 26,363 — — 26,376 Common stock issued in connection with Solana acquisition 1,364,632 13 41,430 — — 41,443 Grant of non-vested shares of common stock 243,228 — — — — — Forfeitures of non-vested shares of common stock (21,541 ) — — — — — Vesting of stock-settled phantom stock and restricted stock units 81,116 5 (5 ) — — — Stock-based compensation — — 13,174 — — 13,174 Balance at September 30, 2014 50,844,255 $ 504 $ 737,732 $ (363,935 ) $ 8,603 $ 382,904 1 The balances of CTA and minimum pension liability adjustment within AOCI were written-off following the liquidation of our former Japanese subsidiary as part of the sale of our OrthoRecon business. This was recorded within the gain on the sale of the OrthoRecon business within results of discontinued operations. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2015 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share ASC Topic 260, Earnings Per Share, requires the presentation of basic and diluted earnings per share. Basic earnings per share is calculated based on the weighted-average number of shares of common stock outstanding during the period. Diluted earnings per share is calculated to include any dilutive effect of our common stock equivalents. Our common stock equivalents consist of stock options, non-vested shares of common stock, stock-settled phantom stock units, restricted stock units, and warrants. The dilutive effect of the stock options, non-vested shares of common stock, stock-settled phantom stock units, restricted stock units and warrants is calculated using the treasury-stock method. When calculating the 2014 diluted earnings per share, we also considered the impact of the 2.625% Convertible Senior Notes which matured on December 1, 2014 (2014 Notes). The dilutive effect of the 2014 Notes is calculated by applying the “if-converted” method. This assumes an add-back of interest, net of income taxes, to net income as if the securities were converted at the beginning of the period. During the three and nine month periods ended September 30, 2014, the 2014 Notes had an anti-dilutive effect on earnings per share and we therefore excluded them from the dilutive shares calculation. In addition, approximately 0.6 million and 0.7 million common stock equivalents have been excluded from the computation of diluted net loss from continuing operations per share for the three and nine month periods ended September 30, 2015 , respectively, because their effect is anti-dilutive as a result of our net loss in that period. In addition, approximately 1.6 million and 1.5 million common stock equivalents have been excluded from the computation of diluted net loss from continuing operations per share for the three and nine month periods ended September 30, 2014 , because their effect is anti-dilutive as a result of our net loss in that period. The weighted-average number of shares outstanding for basic and diluted earnings per share is as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 Weighted-average number of shares outstanding, basic 51,172 50,043 51,033 49,441 Common stock equivalents — — — — Weighted-average number of shares outstanding, diluted 51,172 50,043 51,033 49,441 Net-share settled warrants were anti-dilutive for the three and nine month periods ended September 30, 2015 and for the three and nine month period ended September 30, 2014 . Additionally, the following potential common shares were excluded from common stock equivalents as their effect would have been anti-dilutive (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 Stock options 698 843 709 566 Non-vested shares, restricted stock units, and stock-settled phantom stock units 139 1 9 12 2014 Notes — 115 — 115 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies The commitments and contingencies described in this footnote relate to Wright Medical Technology, Inc., a wholly owned subsidiary of Wright Medical Group, Inc., and are not necessarily applicable to Wright Medical Group, Inc. or other affiliated entities. See Note 14 regarding the merger with Tornier which occurred subsequent to our balance sheet date. Legal Contingencies As described below, our business is subject to various contingencies, including patent and other litigation, product liability claims and a government inquiry. These contingencies could result in losses, including damages, fines, or penalties, any of which could be substantial, as well as criminal charges. Although such matters are inherently unpredictable, and negative outcomes or verdicts can occur, we believe we have significant defenses in all of them, are vigorously defending all of them, and do not believe any of them will have a material adverse effect on our financial position. However, we could incur judgments, pay settlements, or revise our expectations regarding the outcome of any matter. Such developments, if any, could have a material adverse effect on our results of operations in the period in which applicable amounts are accrued, or on our cash flows in the period in which amounts are paid. Our contingencies are subject to significant uncertainties and, therefore, determining the likelihood of a loss or the measurement of a loss can be complex. We have accrued for losses that are both probable and reasonably estimable. Unless otherwise indicated, we are unable to estimate the range of reasonably possible loss in excess of amounts accrued. Our assessment process relies on estimates and assumptions that may prove to be incomplete or inaccurate. Unanticipated events and circumstances may occur that could cause us to change our estimates and assumptions. Governmental Inquiries On September 29, 2010, we entered into a five year Corporate Integrity Agreement (CIA) with the Office of the Inspector General of the United States Department of Health and Human Services (OIG-HHS). The CIA was filed as Exhibit 10.2 to our current report on Form 8-K filed on September 30, 2010. While the CIA expired on September 29, 2015, we have certain reporting obligations with the OIG-HHS that will continue into 2016. The CIA imposed on us certain obligations to maintain compliance with U.S. healthcare laws, regulations and other requirements. Our failure to do so could expose us to significant liability, including, but not limited to, exclusion from federal healthcare program participation, including Medicaid and Medicare, potential prosecution, civil and criminal fines or penalties, as well as additional litigation cost and expense. On August 3, 2012, we received a subpoena from the USAO for the Western District of Tennessee requesting records and documentation relating to our PROFEMUR ® series of hip replacement devices. The subpoena covers the period from January 1, 2000 to August 2, 2012. We continue to cooperate with the investigation. Patent Litigation In 2011, Howmedica Osteonics Corp. and Stryker Ireland, Ltd. (collectively, Stryker), each a subsidiary of Stryker Corporation, filed a lawsuit against Wright Medical Technology, Inc. (WMT) in the United States District Court for the District of New Jersey alleging that we infringed Stryker's U.S. Patent No. 6,475,243 related to our LINEAGE ® Acetabular Cup System and DYNASTY ® Acetabular Cup System. The lawsuit seeks an order of infringement, injunctive relief, unspecified damages, and various other costs and relief. On July 9, 2013, the Court issued a claim construction ruling. On November 25, 2014, the Court entered judgment of non-infringement in our favor. On January 7, 2015, Howmedica and Stryker filed a notice of appeal to the Court of Appeals for the Federal Circuit. The appeal is fully briefed and the Court of Appeals will hear oral argument on December 10, 2015. In 2012, Bonutti Skeletal Innovations, LLC (Bonutti) filed a patent infringement lawsuit against us in the United States Court for the District of Delaware. Subsequently, Inter Partes Review (IPR) of the Bonutti patents was sought before the U.S. Patent and Trademark Office. On April 7, 2014, the Court stayed the case pending outcome of the IPR. Bonutti originally alleged that the Link Sled Prosthesis infringes U.S. Patent 6,702,821. The Link Sled Prosthesis is a product we distributed under a distribution agreement with LinkBio Corp, which expired on December 31, 2013. In January 2013, Bonutti amended its complaint, alleging that the ADVANCE ® knee system, including ODYSSEY ® instrumentation, infringes U.S. Patent 8,133,229, and that the ADVANCE ® knee system, including ODYSSEY ® instrumentation and PROPHECY ® guides, infringes U.S. Patent 7,806,896, which was issued on October 5, 2010. All of the claims of the asserted patents are directed to surgical methods for minimally invasive surgery. As a result of the arguments submitted in the IPR, Bonutti abandoned the claims subject to the IPR from U.S. Patent 8,133,229, leaving one claim from U.S. Patent 7,806,896 still pending before the Patent Office Board that administers IPR’s. On February 18, 2015, the Patent Office Board held that remaining claim invalid. Following the conclusion of the IPRs, the District Court has lifted the stay, and we are continuing with our defense as to remaining patent claims asserted by Bonutti. In June 2013, Orthophoenix, LLC filed a patent lawsuit against us in the United States District Court for the District of Delaware alleging that the X-REAM ® product infringes two patents. In June 2014, we filed a request for IPR with the U.S. Patent and Trademark Office. On December 16, 2014, the Patent Office Board denied our petitions requesting IPR. We are continuing with our defense before the District Court. In June 2013, Anglefix, LLC filed suit in the United States District Court for the Western District of Tennessee, alleging that our ORTHOLOC ® products infringe Anglefix’s asserted patent. On April 14, 2014, we filed a request for IPR with the U.S. Patent and Trademark Office. In October 2014, the Court stayed the case pending outcome of the IPR. On June 30, 2015, the Patent Office Board entered judgment in our favor as to all patent claims at issue in the IPR. Following the conclusion of the IPR, the District Court lifted the stay, and we are continuing with our defense as to remaining patent claims asserted by AngleFix. In February 2014, Biomedical Enterprises, Inc. filed suit against Solana Surgical, LLC in the United States District Court for the Western District of Texas alleging Solana's FuseForce Fixation system infringes U.S. Patent No. 8,584,853 entitled “Method and Apparatus for an Orthopedic Fixation System.” On February 20, 2015, we filed a request for IPR with the U.S. Patent and Trademark Office. On February 27, 2015, Biomedical Enterprises filed an amended complaint to add us and WMT as parties to the litigation. On April 3, 2015, the parties filed a stipulation of dismissal without prejudice as to us. On August 10, 2015, the Patent Office Review Board initiated IPR as to all challenged patent claims. On September 23, 2014, Spineology filed a patent infringement lawsuit, Case No. 0:14-cv-03767, in the U.S. District Court in Minnesota, alleging that Wright’s X-REAM ® bone reamer infringes U.S. Patent No. RE42,757 entitled “EXPANDABLE REAMER.” In January 2015, as the deadline for service of its complaint, Spineology dismissed its complaint without prejudice and filed a new, identical complaint. We filed an answer to the new complaint with the court on April 27, 2015. On January 13, 2015, we received a notice from Corin Limited claiming a portion of the INFINITY ® Total Ankle System infringes their patent rights in France, Germany, Italy, Spain, the Netherlands, and the United Kingdom. We are currently investigating the merits of this claim. Subject to the provisions of the asset purchase agreement with MicroPort for the sale of our OrthoRecon business, we will continue to be responsible for defense of pre-existing patent infringement cases relating to our OrthoRecon business, and for resulting liabilities, if any. Product Liability We have received claims for personal injury against us associated with fractures of our PROFEMUR ® long titanium modular neck product (PROFEMUR ® Claims). The overall fracture rate for the product is low and the fractures appear, at least in part, to relate to patient demographics. Beginning in 2009, we began offering a cobalt-chrome version of our PROFEMUR ® modular neck, which has greater strength characteristics than the alternative titanium version. Historically, we have reflected our liability for these claims as part of our standard product liability accruals on a case-by-case basis. However, during the quarter ended September 30, 2011, as a result of an increase in the number and monetary amount of these claims, management estimated our liability to patients in North America who have previously required a revision following a fracture of a PROFEMUR ® long titanium modular neck, or who may require a revision in the future. Management has estimated that this aggregate liability ranges from approximately $19 million to $24.8 million . Any claims associated with this product outside of North America, or for any other products, will be managed as part of our standard product liability accruals. Due to the uncertainty within our aggregate range of loss resulting from the estimation of the number of claims and related monetary payments, we have recorded a liability of $19 million , which represents the low-end of our estimated aggregate range of loss. We have classified $5 million of this liability as current in “Accrued expenses and other current liabilities” and $14 million as non-current in “Other liabilities” on our condensed consolidated balance sheet. We expect to pay the majority of these claims within the next three years. During the quarter ended September 30, 2015, we increased our estimated liability by approximately $4 million for claims that had been incurred in prior periods. We have analyzed the impact of this adjustment and determined that this out-of-period charge did not have a material impact to the prior period or current period financial statements. We have maintained product liability insurance coverage on a claims-made basis. During the quarter ended March 31, 2013, we received a customary reservation of rights from our primary product liability insurance carrier asserting that present and future claims related to fractures of our PROFEMUR ® titanium modular neck hip products and which allege certain types of injury (Modular Neck Claims) would be covered as a single occurrence under the policy year the first such claim was asserted. The effect of this coverage position would be to place Modular Neck Claims into a single prior policy year in which applicable claims-made coverage was available, subject to the overall policy limits then in effect. Management agrees with the assertion that the Modular Neck Claims should be treated as a single occurrence, but notified the carrier that it disputed the carrier's selection of available policy years. During the second quarter of 2013, we received confirmation from the primary carrier confirming their agreement with our policy year determination. Based on our insurer's treatment of Modular Neck Claims as a single occurrence, we increased our estimate of the total probable insurance recovery related to Modular Neck Claims by $19.4 million , and recognized such additional recovery as a reduction to our selling, general and administrative expenses for the three-months ended March 31, 2013, within results of discontinued operations. In the quarter ended June 30, 2013, we received payment from the primary insurance carrier of $5 million . In the quarter ended September 30, 2013, we received payment of $10 million from the next insurance carrier in the tower. We have requested, but not yet received, payment of the remaining $25 million from the third insurance carrier in the tower for that policy period. The policies with the second and third carrier in this tower are “follow form” policies and management believes the third carrier should follow the coverage position taken by the primary carrier. On September 29, 2015, that third carrier asserted that the terms and conditions identified in its reservation of rights will preclude coverage for the Modular Neck Claims. We strongly dispute the carrier's position and intend to vigorously seek recovery of these funds in the appropriate forum. Pursuant to applicable accounting standards, we have reduced our insurance receivable balance for this claim to $0 , and recorded a $25 million charge within Net Loss from Discontinued Operations. Claims for personal injury have also been made against us associated with our metal-on-metal hip products (primarily our CONSERVE ® product line). The pre-trial management of certain of these claims has been consolidated in the federal court system under multi-district litigation, and certain other claims in state courts in California, collectively the Consolidated Metal-on-Metal Claims. The number of these lawsuits presently exceeds 1,000. We have also entered into an excess of 800 so called "tolling agreements" with potential claimants who have not yet filed suit. We believe we have data that supports the efficacy and safety of our metal-on-metal hip products. While continuing to dispute liability, we have participated in court supervised non-binding mediation in the multi-district federal court litigation. The supervising judge in the Federal Court consolidated proceedings has set a bellwether trial date for the first trial on November 9, 2015. The supervising judge in the California state court proceeding has set a trial date in March 2016. We have maintained product liability insurance coverage on a claims-made basis. During the quarter ended September 30, 2012, we received a customary reservation of rights from our primary product liability insurance carrier asserting that certain present and future claims which allege certain types of injury related to our CONSERVE ® metal-on-metal hip products (CONSERVE ® Claims) would be covered as a single occurrence under the policy year the first such claim was asserted. The effect of this coverage position would be to place CONSERVE ® Claims into a single prior policy year in which applicable claims-made coverage was available, subject to the overall policy limits then in effect. Management agrees that there is insurance coverage for the CONSERVE ® Claims, but has notified the carrier that it disputes the carrier's characterization of the CONSERVE ® Claims as a single occurrence. Management has recorded an insurance receivable for the probable recovery of spending in excess of our retention for a single occurrence. During the first quarter of 2015, we received $5 million of insurance proceeds, which represent the amount undisputed by the carrier for the policy year the first claim was asserted. Our acceptance of these proceeds was not a waiver of any other claim that we may have against the insurance carrier. As of September 30, 2015 , this receivable totaled $14.8 million , and is solely related to defense costs incurred through September 30, 2015 . However, the amount we ultimately receive may differ depending on the final conclusion of the insurance policy year or years and the number of occurrences. We believe our contracts with the insurance carriers are enforceable for these claims and, therefore, we believe it is probable that we will receive recoveries from our insurance carriers. However, our insurance carriers could still ultimately deny coverage for some or all of our insurance claims. Every metal-on-metal hip case involves fundamental issues of science and medicine that often are uncertain, that continue to evolve, and which present contested facts and issues that can differ significantly from case to case. Such contested facts and issues include medical causation, individual patient characteristics, surgery specific factors, and the existence of actual, provable injury. Given these complexities, we are unable to reasonably estimate a probable liability for these matters. Although we continue to contest liability, based upon currently available information, we estimate a reasonably possible range of liability for the Consolidated Metal-on-Metal Claims, before insurance recoveries, averaging from zero to $250,000 per case. Based upon the information we have at this time, we do not believe our liabilities, if any, in connection with these matters will exceed our available insurance. However, as described below, we are currently litigating coverage issues with certain of our carriers. As the litigation moves forward and circumstances continue to develop, our belief we will be able to resolve the Consolidated Metal-on-Metal Claims within available insurance coverage could change, which could materially impact our results of operations and financial position. Further, and notwithstanding our present belief we will be able to resolve these Claims within available insurance proceeds, we would consider contributing a limited amount to the funding of an acceptable, comprehensive, mediated settlement among claimants and insurers. To this end, we have indicated a willingness to contribute up to $30 million to achieve such a comprehensive settlement. Due to continuing uncertainty around (i) whether a multi-party comprehensive settlement can be achieved, (ii) the outcome of our coverage litigation with insurers which could impact the ability to reach a settlement and (iii) the case by case outcomes of any Metal-on-Metal claims ultimately litigated (and which we expect to contest vigorously), we are unable to reasonably estimate a probable liability for these matters and, therefore, no amounts have been accrued. In June 2014, St. Paul Surplus Lines Insurance Company (Travelers), which was an excess carrier in our coverage towers across multiple policy years, filed a declaratory judgment action in Tennessee state court naming us and certain of our other insurance carriers as defendants and asking the court to rule on the rights and responsibilities of the parties with regard to the CONSERVE ® Claims. Among other things, Travelers appears to dispute our contention that the CONSERVE ® Claims arise out of more than a single occurrence thereby triggering multiple policy periods of coverage. Travelers further seeks a determination as to the applicable policy period triggered by the alleged single occurrence. We filed a separate lawsuit in state court in California for declaratory judgment against certain carriers and breach of contract against the primary carrier, and have moved to dismiss or stay the Tennessee action on a number of grounds, including that California is the most appropriate jurisdiction. During the third quarter of 2014, the California Court granted Travelers' motion to stay our California action. In May 2015, we entered into confidential settlement discussions with our insurance carriers through a private mediator. These discussions are continuing. In February 2014, Biomet, Inc. (Biomet) announced it had reached a settlement in the multi-district litigation involving its own metal-on-metal hip products. The terms announced by Biomet include: (i) an expected base settlement amount of $200,000; (ii) an expected minimum settlement amount of $20,000; (iii) no payments to plaintiffs who did not undergo a revision surgery; and (iv) a total settlement amount expected to be within Biomet’s aggregate insurance coverage. We believe our situation involves facts and circumstances that differ significantly from the Biomet cases. In addition to the Consolidated Metal-on-Metal Claims discussed above, there are currently certain other pending claims related to our metal-on-metal hip products for which we are accounting in accordance with our standard product liability accrual methodology on a case by case basis. Certain liabilities associated with the OrthoRecon business, including product liability claims associated with hip and knee products sold prior to the closing, were not assumed by MicroPort. Liabilities associated with these product liability claims, including legal defense, settlements and judgments, income associated with product liability insurance recoveries, and changes to any contingent liabilities associated with the OrthoRecon business have been reflected within results of discontinued operations, and we will continue to reflect these within results of discontinued operations in future periods. MicroPort is responsible for product liability claims associated with products it sells after the closing. In June 2015, a jury returned a $4.4 million verdict against us in a case involving a fractured hip implant stem sold prior to the MicroPort closing. This was a one-of-a-kind case unrelated to the modular neck fracture cases we have been reporting. There are no other cases pending related to this component, nor are we aware of other instances where this component has fractured. In September 2015, the trial judge reduced the jury verdict to $1.025 million and indicated that if plaintiff did not accept the reduced award he would schedule a new trial solely on the issue of damages. Both parties have appealed, and we expect no further substantive post-trial activity until the appeals are heard . We are presently evaluating our post-trial options. The $4.4 million probable liability associated with this matter is reflected within “Accrued expenses and other current liabilities,” and a $4.1 million receivable associated with the probable recovery from product liability insurance is reflected within “Other current assets.” MicroPort Indemnification Claim In July 2015, we received demand letters from MicroPort seeking indemnification under the terms of the asset purchase agreement for the sale of our OrthoRecon business for losses or potential losses it has incurred or may incur as a result of either alleged breaches of representations in the asset purchase agreement or alleged unassumed liabilities. MicroPort asserted that the range of potential losses for which it seeks indemnity is between $18.5 million and $30 million. We responded to MicroPort's demand letters and received a further demand letter reiterating each of their claims and providing revised claim amounts. In this letter MicroPort asserted that the range of potential losses for which it seeks indemnity is between $77.5 million and $112.5 million. We expect to vigorously contest the validity of these claims and we have not determined the likelihood of an unfavorable outcome. Other In addition to those noted above, we are subject to various other legal proceedings, product liability claims, corporate governance, and other matters which arise in the ordinary course of business. |
Segment Information (Notes)
Segment Information (Notes) | 9 Months Ended |
Sep. 30, 2015 | |
Segment Reporting, Revenue Reconciling Item [Line Items] | |
Segment Reporting Disclosure [Text Block] | Segment Information During the first quarter of 2014, our management, including our chief executive officer, who is our chief operating decision maker, began managing our operations as three operating business segments: U.S., International and BioMimetic, based on management's change to the way it monitors performance, aligns strategies, and allocates resources which resulted in a change in our reportable segments. We determined that each of these operating segments represented a reportable segment. Our U.S. and International segments represent the commercial, administrative and research & development activities dedicated to the respective geographies. The BioMimetic segment represents the administrative and research & development activities of the acquired BioMimetic business (sales and associated expenses for Augment ® products are included within the U.S. and International segments). The Corporate category shown in the table below primarily reflects general and administrative expenses not specifically associated with the U.S., International or BioMimetic segments. These non-allocated corporate expenses relate to global administrative expenses that support all segments, including salaries and benefits of executive officers and expenses such as: information technology administration and support; corporate headquarters; legal, compliance, and corporate finance functions; insurance; and all stock-based compensation. Management measures segment profitability using an internal operating performance measure that excludes the impact of inventory step-up amortization, charges associated with distributor conversions and related non-competes, and due diligence, transaction and transition costs associated with acquisitions. Selected financial information related to our segments is presented below for the three and nine months ended September 30, 2015 and 2014 (in thousands): Three Months Ended September 30, 2015 U.S. International BioMimetic Corporate Total Sales $ 60,394 $ 19,745 $ — $ — $ 80,139 Depreciation expense 3,500 827 46 1,895 6,268 Amortization expense 2,025 469 52 — 2,546 Segment operating income (loss) $ 2,219 $ (2,627 ) $ (3,952 ) $ (16,759 ) $ (21,119 ) Other: Inventory step-up amortization (20 ) Distributor conversion and non-compete charges (16 ) Due diligence, transaction and transition expenses (19,887 ) Operating loss (41,042 ) Interest expense, net 11,185 Other (income) expense, net 10,236 Loss before income taxes $ (62,463 ) Capital expenditures $ 7,154 $ 1,094 $ 11 $ — $ 8,259 Three Months Ended September 30, 2014 U.S. International BioMimetic Corporate Total Sales $ 51,297 $ 20,010 $ — $ — $ 71,307 Depreciation expense 2,414 841 108 1,291 4,654 Amortization expense 1,293 547 77 — 1,917 Segment operating income (loss) $ 6,448 $ (3,213 ) $ (2,601 ) $ (15,660 ) $ (15,026 ) Other: Inventory step-up amortization (302 ) Distributor conversion and non-compete charges (478 ) Patent Dispute Settlement (900 ) Management Changes (1,203 ) Due diligence, transaction and transition expenses (2,740 ) Operating loss (20,649 ) Interest expense, net 4,565 Other (income) expense, net 21,430 Loss before income taxes $ (46,644 ) Capital expenditures $ 4,267 $ 3,290 $ — $ 3,865 $ 11,422 Nine Months Ended September 30, 2015 U.S. International BioMimetic Corporate Total Sales $ 176,150 $ 62,343 $ — $ — $ 238,493 Depreciation expense 9,693 2,330 127 4,816 16,966 Amortization expense 6,132 1,402 142 — 7,676 Segment operating income (loss) $ 8,021 $ (8,658 ) $ (11,051 ) $ (53,643 ) $ (65,331 ) Other: Inventory step-up amortization (69 ) Distributor conversion and non-compete charges (65 ) Due diligence, transaction and transition expenses (43,040 ) Operating loss (108,505 ) Interest expense, net 29,793 Other (income) expense, net 7,395 Loss before income taxes $ (145,693 ) Capital expenditures $ 30,361 $ 3,572 $ 55 $ 25 $ 34,013 Nine Months Ended September 30, 2014 U.S. International BioMimetic Corporate Total Sales $ 149,591 $ 65,142 $ — $ — $ 214,733 Depreciation expense 7,093 2,246 324 3,831 13,494 Amortization expense 3,820 1,663 231 1 5,715 Segment operating income (loss) $ 12,914 $ (2,385 ) $ (9,385 ) $ (52,658 ) $ (51,514 ) Other: Inventory step-up amortization (1,521 ) Distributor conversion and non-compete charges (1,698 ) Patent Dispute Settlement (900 ) Management Changes (1,203 ) Due diligence, transaction and transition expenses (16,030 ) Operating loss (72,866 ) Interest expense, net 12,873 Other (income) expense, net 54,986 Loss before income taxes $ (140,725 ) Capital expenditures $ 13,464 $ 7,597 $ 39 $ 14,606 $ 35,706 Assets in the U.S., International and BioMimetic segments are those assets used exclusively in the operations of each business segment or allocated when used jointly. Assets in the Corporate category are principally cash and cash equivalents, derivative asset, property, plant and equipment associated with our corporate infrastructure, assets associated with OrthoRecon insurance receivables, assets associated with income taxes, and in 2014, marketable securities. Total assets by business segment as of September 30, 2015 and December 31, 2014 are as follows (in thousands): September 30, 2015 U.S. International BioMimetic Corporate Total Total assets $ 437,509 $ 115,976 $ 21,609 $ 390,441 $ 965,535 December 31, 2014 U.S. International BioMimetic Corporate Total Total assets $ 450,055 $ 94,412 $ 17,924 $ 330,285 $ 892,676 Our principal geographic regions consist of the United States, Europe (which includes the Middle East and Africa), and Other (which principally represents Asia, Australia, Canada, and Latin America). The following table presents net sales by geographic area for the three and nine months ended September 30, 2015 and 2014 are as follows (in thousands): Three Months Ended Nine Months Ended Geographic September 30, 2015 September 30, 2014 % change September 30, 2015 September 30, 2014 % change United States $ 60,394 $ 51,297 17.7 % $ 176,150 $ 149,591 17.8 % Europe 10,718 11,180 (4.1 %) 34,951 36,615 (4.5 %) Other 9,027 8,830 2.2 % 27,392 28,527 (4.0 %) Total net sales $ 80,139 $ 71,307 12.4 % $ 238,493 $ 214,733 11.1 % Long-lived assets by geographic area as of September 30, 2015 and December 31, 2014 are as follows (in thousands): Long-Lived Assets: September 30, 2015 December 31, 2014 United States $ 110,994 $ 92,822 Europe 8,165 8,065 Other 3,291 3,348 Total $ 122,450 $ 104,235 |
Summary of Significant Accoun22
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation. The unaudited condensed consolidated interim financial statements of Wright Medical Group, Inc. (WMG, legacy Wright, we, us, or our) have been prepared in accordance with accounting principles generally accepted (GAAP) in the United States (U.S.) for interim financial statements. Accordingly, these unaudited condensed consolidated interim financial statements should be read in conjunction with our consolidated financial statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, 2014 , as filed with the U.S. Securities and Exchange Commission (SEC) on February 26, 2015. On October 1, 2015, we completed our previously announced merger with Tornier N.V. (Tornier). See Note 14 to the consolidated financial statements for additional information regarding the merger. In the opinion of management, these unaudited condensed consolidated interim financial statements reflect all adjustments necessary for a fair presentation of our interim financial results. All such adjustments are of a normal and recurring nature. The results of operations for any interim period are not indicative of results for the full fiscal year. The accompanying unaudited condensed consolidated interim financial statements include our accounts and those of our domestic and international subsidiaries, all of which are wholly-owned subsidiaries. Intercompany accounts and transactions have been eliminated in consolidation. The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities at the dates of the financial statements and the amounts of revenues and expenses during the reporting periods. Actual amounts realized or paid could differ from those estimates. |
Earnings Per Share (Policies)
Earnings Per Share (Policies) | 9 Months Ended |
Sep. 30, 2015 | |
Earnings Per Share [Abstract] | |
Earnings Per Share, FASB ASC Topic 260 | ASC Topic 260, Earnings Per Share, requires the presentation of basic and diluted earnings per share. Basic earnings per share is calculated based on the weighted-average number of shares of common stock outstanding during the period. Diluted earnings per share is calculated to include any dilutive effect of our common stock equivalents. Our common stock equivalents consist of stock options, non-vested shares of common stock, stock-settled phantom stock units, restricted stock units, and warrants. The dilutive effect of the stock options, non-vested shares of common stock, stock-settled phantom stock units, restricted stock units and warrants is calculated using the treasury-stock method. When calculating the 2014 diluted earnings per share, we also considered the impact of the 2.625% Convertible Senior Notes which matured on December 1, 2014 (2014 Notes). The dilutive effect of the 2014 Notes is calculated by applying the “if-converted” method. This assumes an add-back of interest, net of income taxes, to net income as if the securities were converted at the beginning of the period. |
Summary of Significant Accoun24
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
Credit Risk Assumptions for Derivatives [Table Text Block] | The following assumptions were used in the fair market valuations of the 2017 Notes Conversion Derivative and 2020 Notes Conversion Derivative and 2020 Notes Hedges as of September 30, 2015 : 2017 Notes Conversion Derivative 2020 Notes Conversion Derivative 2020 Notes Hedge Stock Price Volatility (1) 43 % 43 % 43 % Credit Spread for Wright (2) 5.4 % 6.4 % NA Credit Spread for Deutsche Bank AG (3) N/A N/A 0.9 % Credit Spread for Wells Fargo Securities, LLC (3) N/A N/A 0.5 % Credit Spread for JPMorgan Chase Bank (3) N/A N/A 0.7 % |
Valuation of Financial Instruments at Fair Value Table | The following table summarizes the valuation of our financial instruments measured at fair value on a recurring basis (in thousands): Total Quoted Prices Prices with Prices with At September 30, 2015 Assets Cash and cash equivalents $ 254,435 $ 254,435 $ — $ — Available-for-sale marketable securities Corporate debt securities — — — — U.S. government debt securities — — — — Total available-for-sale marketable securities — — — — 2020 Notes Hedges 102,226 — — 102,226 Total $ 356,661 $ 254,435 $ — $ 102,226 Liabilities 2017 Notes Conversion Derivative $ 8,143 $ — $ — $ 8,143 2020 Notes Conversion Derivative 103,615 — — 103,615 Contingent consideration 3,303 — — 3,303 Contingent consideration (CVR) 28,590 28,590 — — Total $ 143,651 $ 28,590 $ — $ 115,061 Total Quoted Prices Prices with Prices with At December 31, 2014 Assets Cash and cash equivalents $ 227,326 $ 227,326 $ — $ — Available-for-sale marketable securities Corporate debt securities 566 — 566 — U.S. Government debt securities 2,009 2,009 — — Total available-for-sale marketable securities 2,575 2,009 566 — 2017 Notes Hedges 80,000 — — 80,000 Total $ 309,901 $ 229,335 $ 566 $ 80,000 Liabilities 2017 Notes Conversion Derivative $ 76,000 $ — $ — $ 76,000 Contingent consideration 1,705 — — 1,705 Contingent consideration (CVR) $ 133,981 133,981 $ — $ — Total $ 211,686 $ 133,981 $ — $ 77,705 |
Fair Value Assets And Liabilities Measured On Recurring Basis Unobservable Input Reconciliation | The following is a roll forward of our assets and liabilities measured at fair value on a recurring basis using unobservable inputs (Level 3): Balance at December 31, 2014 Additions Transfers into Level 3 Gain/(Losses) included in Earnings Currency Settlements Balance at September 30, 2015 2017 Notes Hedges $ 80,000 — — (10,236 ) — (69,764 ) $ — 2017 Notes Conversion Derivative $ (76,000 ) — — 18,705 — 49,152 $ (8,143 ) 2020 Notes Hedges $ — 144,843 — (42,617 ) — — $ 102,226 2020 Notes Conversion Derivative $ — (149,784 ) — 46,169 — — $ (103,615 ) Contingent Consideration $ (1,705 ) (1,501 ) — (144 ) 47 — $ (3,303 ) |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of Disposal Groups, Including Discontinued Operations, Income Statement, Balance Sheet and Additional Disclosures [Table Text Block] | Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 Revenue $ — $ — $ — $ 3,056 Loss before tax (including $24.3 million gain from disposal in 2014) (36,211 ) (18,137 ) (46,720 ) (7,121 ) Income tax benefit — (5,977 ) — 7,804 Loss from discontinued operations, net of tax (36,211 ) (12,160 ) (46,720 ) (14,925 ) Net loss from discontinued operations per share ( Note11 ): Basic $ (0.71 ) $ (0.24 ) $ (0.92 ) $ (0.30 ) Diluted $ (0.71 ) $ (0.24 ) $ (0.92 ) $ (0.30 ) Weighted-average number of shares outstanding-basic 51,172 50,043 51,033 49,441 Weighted-average number of shares outstanding-diluted 51,172 50,043 51,033 49,441 |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | Inventories consist of the following (in thousands): September 30, December 31, Raw materials $ 7,768 $ 6,910 Work-in-process 16,806 13,849 Finished goods 86,490 67,653 $ 111,064 $ 88,412 |
Marketable Securities (Tables)
Marketable Securities (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Marketable Securities [Abstract] | |
Summary of Marketable Securities Table | The following tables present a summary of our marketable securities as of December 31, 2014 (in thousands): Amortized Cost Gross Gross Estimated At December 31, 2014 Available-for-sale marketable securities Corporate debt securities 566 — — 566 U.S. government debt securities 2,009 — — 2,009 Total available-for-sale marketable securities $ 2,575 $ — $ — $ 2,575 |
Property, Plant and Equipment28
Property, Plant and Equipment, Net (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Property, Plant and Equipment, Net [Abstract] | |
Schedule of Property, Plant and Equipment | Property, plant and equipment consist of the following (in thousands): September 30, December 31, Property, plant and equipment, at cost $ 221,602 $ 191,094 Less: Accumulated depreciation (99,152 ) (86,859 ) $ 122,450 $ 104,235 |
Long-Term Debt and Capital Le29
Long-Term Debt and Capital Lease Obligations (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Long-term Debt and Capital Lease Obligations [Abstract] | |
Schedule of Long-term Debt Instruments | Long-term debt and capital lease obligations consist of the following (in thousands): September 30, December 31, Capital lease obligations $ 12,197 $ 8,678 2017 Notes 55,999 272,652 2020 Notes 498,144 — 566,340 281,330 Less: current portion (784 ) (718 ) $ 565,556 $ 280,612 |
Components of Convertible Debt | September 30, 2015 December 31, 2014 Principal amount of 2020 Notes $ 632,500 $ — Unamortized debt discount (134,356 ) — Net carrying amount of 2020 Notes $ 498,144 $ — |
Derivative Instruments and He30
Derivative Instruments and Hedging Activities (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
2017 Derivatives [Member] [Member] | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Change in Fair Value | Neither the 2017 Notes Conversion Derivative nor the 2017 Notes Hedges qualify for hedge accounting, thus any change in the fair value of the derivatives is recognized immediately in the condensed consolidated statements of operations. The following table summarizes the gain (loss) on changes in fair value (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 2017 Notes Hedges $ — $ (12,000 ) $ (10,236 ) $ (6,000 ) 2017 Notes Conversion Derivative 4,407 11,000 18,705 4,000 Net gain (loss) on changes in fair value $ 4,407 $ (1,000 ) $ 8,469 $ (2,000 ) |
Summary of fair value and the presentation in the consolidated balance sheet | The following table summarizes the fair value and the presentation in the condensed consolidated balance sheet (in thousands): Location on condensed consolidated balance sheet September 30, 2015 December 31, 2014 2017 Notes Hedges Other assets $ — $ 80,000 2017 Notes Conversion Derivative Other liabilities $ 8,143 $ 76,000 |
2020 Derivatives [Member] | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Change in Fair Value | Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 2020 Notes Hedges $ (21,512 ) $ — $ (42,617 ) $ — 2020 Notes Conversion Derivative 21,757 — 46,169 — Net gain on changes in fair value $ 245 $ — $ 3,552 $ — |
Summary of fair value and the presentation in the consolidated balance sheet | Location on condensed consolidated balance sheet September 30, 2015 December 31, 2014 2020 Notes Hedges Other assets $ 102,226 $ — 2020 Notes Conversion Derivative Other liabilities $ 103,615 $ — |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Changes in the Carrying Amount of Goodwill Table | Changes in the carrying amount of goodwill occurring during the nine months ended September 30, 2015 are as follows (in thousands): U.S. International BioMimetic Total Goodwill at December 31, 2014 $ 173,589 $ 16,041 $ 1,336 $ 190,966 Goodwill associated with acquisitions — 3,887 — 3,887 Foreign currency translation — (4,285 ) — (4,285 ) Goodwill at September 30, 2015 $ 173,589 $ 15,643 $ 1,336 $ 190,568 |
Components of Identifiable Assets Table | The components of our identifiable intangible assets are as follows (in thousands): September 30, 2015 December 31, 2014 Cost Accumulated Amortization Cost Accumulated Amortization Indefinite life intangibles In-process research and development technology $ — $ 4,266 Tradename 3,951 4,004 Total indefinite life intangibles 3,951 8,270 Finite life intangibles Distribution channels 250 212 250 194 Completed technology 37,001 11,786 33,253 9,185 Licenses 8,233 2,128 8,234 1,637 Customer relationships 32,661 6,284 27,946 4,636 Trademarks 2,756 2,416 2,798 1,850 Non-compete agreements 8,785 3,593 8,508 3,397 Other 1,231 141 771 106 Total finite life intangibles 90,917 $ 26,560 81,760 $ 21,005 Total intangibles 94,868 90,030 Less: Accumulated amortization (26,560 ) (21,005 ) Intangible assets, net $ 68,308 $ 69,025 |
Accumulated Other Comprehensi32
Accumulated Other Comprehensive Income (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Accumulated Other Comprehensive Income [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block] | Changes in and reclassifications out of AOCI, net of tax, for the nine months ended September 30, 2015 were as follows (in thousands): Currency Translation Adjustment (CTA) Balance December 31, 2014 $ 2,398 Other comprehensive income (loss), net of tax (7,293 ) Balance September 30, 2015 $ (4,895 ) |
Changes in Stockholders' Equi33
Changes in Stockholders' Equity (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Changes in Stockholders' Equity [Abstract] | |
Schedule of Stockholders Equity [Table Text Block] | Nine Months Ended September 30, 2015 Common Stock Additional Paid-in Capital Retained Earnings/ (Accumulated Deficit) Accumulated Other Comprehensive Income Total Stockholders' Equity Number of Shares Amount Balance at December 31, 2014 51,326,696 $ 509 $ 751,061 $ (475,165 ) $ 2,398 $ 278,803 2015 Activity: Net loss — — — (192,924 ) — (192,924 ) Foreign currency translation — — — — (7,293 ) (7,293 ) Issuances of common stock 133,544 1 3,089 — — 3,090 Grant of non-vested shares of common stock 5,092 — — — — — Forfeitures of non-vested shares of common stock (5,695 ) — — — — — Vesting of stock-settled phantom stock and restricted stock units 12,170 2 (2 ) — — — Stock-based compensation — — 7,720 — — 7,720 Issuance of stock warrants, net of equity issuance costs — — 24,575 — — 24,575 Balance at September 30, 2015 51,471,807 $ 512 $ 786,443 $ (668,089 ) $ (4,895 ) $ 113,971 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Earnings Per Share [Abstract] | |
Weighted average number of shares outstanding for basic and diluted earnings per share | The weighted-average number of shares outstanding for basic and diluted earnings per share is as follows (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 Weighted-average number of shares outstanding, basic 51,172 50,043 51,033 49,441 Common stock equivalents — — — — Weighted-average number of shares outstanding, diluted 51,172 50,043 51,033 49,441 |
Antidilutive potential common shares resulting from reasons other than net loss incurred excluded from the diluted earnings per share computation | he following potential common shares were excluded from common stock equivalents as their effect would have been anti-dilutive (in thousands): Three Months Ended Nine Months Ended September 30, September 30, 2015 2014 2015 2014 Stock options 698 843 709 566 Non-vested shares, restricted stock units, and stock-settled phantom stock units 139 1 9 12 2014 Notes — 115 — 115 |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |
Reconciliation of Assets from Segment to Consolidated [Table Text Block] | Total assets by business segment as of September 30, 2015 and December 31, 2014 are as follows (in thousands): September 30, 2015 U.S. International BioMimetic Corporate Total Total assets $ 437,509 $ 115,976 $ 21,609 $ 390,441 $ 965,535 |
Schedule of Segment Reporting Information, by Segment [Table Text Block] | Selected financial information related to our segments is presented below for the three and nine months ended September 30, 2015 and 2014 (in thousands): Three Months Ended September 30, 2015 U.S. International BioMimetic Corporate Total Sales $ 60,394 $ 19,745 $ — $ — $ 80,139 Depreciation expense 3,500 827 46 1,895 6,268 Amortization expense 2,025 469 52 — 2,546 Segment operating income (loss) $ 2,219 $ (2,627 ) $ (3,952 ) $ (16,759 ) $ (21,119 ) Other: Inventory step-up amortization (20 ) Distributor conversion and non-compete charges (16 ) Due diligence, transaction and transition expenses (19,887 ) Operating loss (41,042 ) Interest expense, net 11,185 Other (income) expense, net 10,236 Loss before income taxes $ (62,463 ) Capital expenditures $ 7,154 $ 1,094 $ 11 $ — $ 8,259 Three Months Ended September 30, 2014 U.S. International BioMimetic Corporate Total Sales $ 51,297 $ 20,010 $ — $ — $ 71,307 Depreciation expense 2,414 841 108 1,291 4,654 Amortization expense 1,293 547 77 — 1,917 Segment operating income (loss) $ 6,448 $ (3,213 ) $ (2,601 ) $ (15,660 ) $ (15,026 ) Other: Inventory step-up amortization (302 ) Distributor conversion and non-compete charges (478 ) Patent Dispute Settlement (900 ) Management Changes (1,203 ) Due diligence, transaction and transition expenses (2,740 ) Operating loss (20,649 ) Interest expense, net 4,565 Other (income) expense, net 21,430 Loss before income taxes $ (46,644 ) Capital expenditures $ 4,267 $ 3,290 $ — $ 3,865 $ 11,422 Nine Months Ended September 30, 2015 U.S. International BioMimetic Corporate Total Sales $ 176,150 $ 62,343 $ — $ — $ 238,493 Depreciation expense 9,693 2,330 127 4,816 16,966 Amortization expense 6,132 1,402 142 — 7,676 Segment operating income (loss) $ 8,021 $ (8,658 ) $ (11,051 ) $ (53,643 ) $ (65,331 ) Other: Inventory step-up amortization (69 ) Distributor conversion and non-compete charges (65 ) Due diligence, transaction and transition expenses (43,040 ) Operating loss (108,505 ) Interest expense, net 29,793 Other (income) expense, net 7,395 Loss before income taxes $ (145,693 ) Capital expenditures $ 30,361 $ 3,572 $ 55 $ 25 $ 34,013 Nine Months Ended September 30, 2014 U.S. International BioMimetic Corporate Total Sales $ 149,591 $ 65,142 $ — $ — $ 214,733 Depreciation expense 7,093 2,246 324 3,831 13,494 Amortization expense 3,820 1,663 231 1 5,715 Segment operating income (loss) $ 12,914 $ (2,385 ) $ (9,385 ) $ (52,658 ) $ (51,514 ) Other: Inventory step-up amortization (1,521 ) Distributor conversion and non-compete charges (1,698 ) Patent Dispute Settlement (900 ) Management Changes (1,203 ) Due diligence, transaction and transition expenses (16,030 ) Operating loss (72,866 ) Interest expense, net 12,873 Other (income) expense, net 54,986 Loss before income taxes $ (140,725 ) Capital expenditures $ 13,464 $ 7,597 $ 39 $ 14,606 $ 35,706 |
Schedule of Disclosure on Geographic Areas, Long-Lived Assets in Individual Foreign Countries by Country [Table Text Block] | The following table presents net sales by geographic area for the three and nine months ended September 30, 2015 and 2014 are as follows (in thousands): Three Months Ended Nine Months Ended Geographic September 30, 2015 September 30, 2014 % change September 30, 2015 September 30, 2014 % change United States $ 60,394 $ 51,297 17.7 % $ 176,150 $ 149,591 17.8 % Europe 10,718 11,180 (4.1 %) 34,951 36,615 (4.5 %) Other 9,027 8,830 2.2 % 27,392 28,527 (4.0 %) Total net sales $ 80,139 $ 71,307 12.4 % $ 238,493 $ 214,733 11.1 % Long-lived assets by geographic area as of September 30, 2015 and December 31, 2014 are as follows (in thousands): Long-Lived Assets: September 30, 2015 December 31, 2014 United States $ 110,994 $ 92,822 Europe 8,165 8,065 Other 3,291 3,348 Total $ 122,450 $ 104,235 |
Summary of Significant Accoun36
Summary of Significant Accounting Policies (Details) - USD ($) | Feb. 13, 2015 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | Mar. 01, 2013 | Aug. 22, 2012 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Repayments of Debt | $ 292,000,000 | |||||||
Mark-to-market adjustment for CVRs (Note 1) | $ 14,600,000 | $ 18,500,000 | $ (7,290,000) | $ 51,294,000 | ||||
Acquisitions Prior to 2012 [Member] | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Contingent Consideration Fair Value | 200,000 | 200,000 | ||||||
WG Healthcare [Member] | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Contingent Consideration Fair Value | 1,600,000 | 1,600,000 | ||||||
SSP - Distribution Business [Member] | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Contingent Consideration Fair Value | 1,500,000 | 1,500,000 | ||||||
BioMimetics [Member] | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Contingent Consideration Fair Value | $ 6.50 | |||||||
2020convertibledebt [Member] | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Long-term debt, gross | $ 632,500,000 | |||||||
Stated percentage rate | 2.00% | |||||||
2020convertibledebt [Member] | Carrying (Reported) Amount, Fair Value Disclosure [Member] | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Long-term debt, gross | $ 632,500,000 | |||||||
Convertible senior notes | 605,400,000 | 605,400,000 | ||||||
2017convertibledebt [Member] | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Long-term debt, gross | 60,000,000 | 60,000,000 | $ 300,000,000 | $ 300,000,000 | ||||
Repayments of Debt | 240,000,000 | |||||||
Stated percentage rate | 2.00% | |||||||
2017convertibledebt [Member] | Carrying (Reported) Amount, Fair Value Disclosure [Member] | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Long-term debt, gross | 60,000,000 | 60,000,000 | ||||||
Convertible senior notes | 63,600,000 | $ 63,600,000 | ||||||
BMTI Payment of Conditional Value Rights [Member] | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Price per share of contingent consideration | $ 3.50 | |||||||
Mark-to-market adjustment for CVRs (Note 1) | $ 98,100,000 | |||||||
Contingent Consideration [Member] | Fair Value, Measurements, Recurring [Member] | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Contingent Consideration Fair Value | 3,303,000 | 3,303,000 | 1,705,000 | |||||
Contingent Consideration [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Contingent Consideration Fair Value | 0 | 0 | 0 | |||||
Contingent Consideration [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Contingent Consideration Fair Value | 0 | 0 | 0 | |||||
Contingent Consideration [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Contingent Consideration Fair Value | 3,303,000 | 3,303,000 | 1,705,000 | |||||
ContingentValueRights [Member] | Fair Value, Measurements, Recurring [Member] | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Contingent Consideration Fair Value | 28,590,000 | 28,590,000 | 133,981,000 | |||||
ContingentValueRights [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Contingent Consideration Fair Value | 28,590,000 | 28,590,000 | 133,981,000 | |||||
ContingentValueRights [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Contingent Consideration Fair Value | 0 | 0 | 0 | |||||
ContingentValueRights [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | ||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||
Contingent Consideration Fair Value | $ 0 | $ 0 | $ 0 |
Summary of Significant Accoun37
Summary of Significant Accounting Policies - Valuation of Financial Instruments (Details) - USD ($) $ in Thousands | Feb. 13, 2015 | Sep. 30, 2015 | Dec. 31, 2014 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Repayments of Debt | $ 292,000 | ||
Fair Value, Measurements, Recurring [Member] | |||
Assets | |||
Cash and cash equivalents | $ 254,435 | $ 227,326 | |
Total Available For Sale Securities | 0 | 2,575 | |
Total Assets | 356,661 | 309,901 | |
Liabilities | |||
Total Liabilities | 143,651 | 211,686 | |
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | |||
Assets | |||
Cash and cash equivalents | 254,435 | 227,326 | |
Total Available For Sale Securities | 0 | 2,009 | |
Notes Hedges | 0 | 0 | |
Total Assets | 254,435 | 229,335 | |
Liabilities | |||
Total Liabilities | 28,590 | 133,981 | |
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | |||
Assets | |||
Cash and cash equivalents | 0 | 0 | |
Total Available For Sale Securities | 0 | 566 | |
Notes Hedges | 0 | 0 | |
Total Assets | 0 | 566 | |
Liabilities | |||
Total Liabilities | 0 | 0 | |
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | |||
Assets | |||
Cash and cash equivalents | 0 | 0 | |
Total Available For Sale Securities | 0 | 0 | |
Total Assets | 102,226 | 80,000 | |
Liabilities | |||
Total Liabilities | 115,061 | 77,705 | |
Contingent Consideration [Member] | Fair Value, Measurements, Recurring [Member] | |||
Liabilities | |||
Contingent Consideration Fair Value | 3,303 | 1,705 | |
Contingent Consideration [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | |||
Liabilities | |||
Contingent Consideration Fair Value | 0 | 0 | |
Contingent Consideration [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | |||
Liabilities | |||
Contingent Consideration Fair Value | 0 | 0 | |
Contingent Consideration [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | |||
Liabilities | |||
Contingent Consideration Fair Value | 3,303 | 1,705 | |
ContingentValueRights [Member] | Fair Value, Measurements, Recurring [Member] | |||
Liabilities | |||
Contingent Consideration Fair Value | 28,590 | 133,981 | |
ContingentValueRights [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | |||
Liabilities | |||
Contingent Consideration Fair Value | 28,590 | 133,981 | |
ContingentValueRights [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | |||
Liabilities | |||
Contingent Consideration Fair Value | 0 | 0 | |
ContingentValueRights [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | |||
Liabilities | |||
Contingent Consideration Fair Value | 0 | 0 | |
US Government Debt Securities [Member] | Fair Value, Measurements, Recurring [Member] | |||
Assets | |||
Estimated Fair Value | 0 | 2,009 | |
US Government Debt Securities [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | |||
Assets | |||
Estimated Fair Value | 0 | 2,009 | |
US Government Debt Securities [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | |||
Assets | |||
Estimated Fair Value | 0 | 0 | |
US Government Debt Securities [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | |||
Assets | |||
Estimated Fair Value | 0 | 0 | |
Corporate debt securities [Member] | Fair Value, Measurements, Recurring [Member] | |||
Assets | |||
Estimated Fair Value | 0 | 566 | |
Corporate debt securities [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | |||
Assets | |||
Estimated Fair Value | 0 | 0 | |
Corporate debt securities [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | |||
Assets | |||
Estimated Fair Value | 0 | 566 | |
Corporate debt securities [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | |||
Assets | |||
Estimated Fair Value | 0 | 0 | |
2017 Notes Hedges [Member] | |||
Assets | |||
Notes Hedges | 0 | 80,000 | |
Liabilities | |||
Notes Conversion Derivative | 8,143 | 76,000 | |
2017 Notes Hedges [Member] | Fair Value, Measurements, Recurring [Member] | |||
Assets | |||
Notes Hedges | 80,000 | ||
2020 Notes Hedges [Member] | |||
Assets | |||
Notes Hedges | 102,226 | ||
2020 Notes Hedges [Member] | Fair Value, Measurements, Recurring [Member] | |||
Assets | |||
Notes Hedges | 102,226 | ||
2017 Notes Conversion Derivative [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Repayments of Debt | 240,000 | ||
2017 Notes Conversion Derivative [Member] | Fair Value, Measurements, Recurring [Member] | |||
Liabilities | |||
Notes Conversion Derivative | 8,143 | 76,000 | |
2017 Notes Conversion Derivative [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | |||
Liabilities | |||
Notes Conversion Derivative | 0 | 0 | |
2017 Notes Conversion Derivative [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | |||
Liabilities | |||
Notes Conversion Derivative | 0 | 0 | |
2017 Notes Conversion Derivative [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | |||
Liabilities | |||
Notes Conversion Derivative | 8,143 | $ 76,000 | |
2020 Conversion Derivative [Member] | |||
Liabilities | |||
Notes Conversion Derivative | 103,615 | ||
2020 Conversion Derivative [Member] | Fair Value, Measurements, Recurring [Member] | |||
Liabilities | |||
Notes Conversion Derivative | 103,615 | ||
2020 Conversion Derivative [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | |||
Liabilities | |||
Notes Conversion Derivative | 0 | ||
2020 Conversion Derivative [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | |||
Liabilities | |||
Notes Conversion Derivative | 0 | ||
2020 Conversion Derivative [Member] | Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | |||
Liabilities | |||
Notes Conversion Derivative | 103,615 | ||
2017convertibledebt [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Repayments of Debt | $ 240,000 |
Summary of Significant Accoun38
Summary of Significant Accounting Policies Summary of Significant Accounting Policies Fair Value Measurments (Assets and Liabilities Measured At Fair Value on A Recurring Basis Using Unobservable Inputs (Level 3) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
FairValueAssetsAndLiabilitiesMeasuredOnRecurringBasisUnobservableInputReconciliationTableTextBlock [Line Items] | |||||
Mark-to-market adjustment for CVRs (Note 1) | $ 14,600 | $ 18,500 | $ (7,290) | $ 51,294 | |
2020 Conversion Derivative [Member] | |||||
FairValueAssetsAndLiabilitiesMeasuredOnRecurringBasisUnobservableInputReconciliationTableTextBlock [Line Items] | |||||
Fair Value, Measurement with Unobservable Inputs Reconciliations, Recurring Basis, Liability Value | (103,615) | (103,615) | $ 0 | ||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Liability, Transfers Into Level 3 | (149,784) | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Liability, Gain (Loss) Included in Earnings | 46,169 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Currency | 0 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Liability, Settlements | 0 | ||||
Contingent Consideration [Member] | |||||
FairValueAssetsAndLiabilitiesMeasuredOnRecurringBasisUnobservableInputReconciliationTableTextBlock [Line Items] | |||||
Fair Value, Measurement with Unobservable Inputs Reconciliations, Recurring Basis, Liability Value | (3,303) | (3,303) | (1,705) | ||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Liability, Transfers Into Level 3 | 0 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Liability, Gain (Loss) Included in Earnings | (144) | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Currency | 47 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Liability, Settlements | 0 | ||||
2017 Notes Conversion Derivative [Member] | |||||
FairValueAssetsAndLiabilitiesMeasuredOnRecurringBasisUnobservableInputReconciliationTableTextBlock [Line Items] | |||||
Fair Value, Measurement with Unobservable Inputs Reconciliations, Recurring Basis, Liability Value | (8,143) | (8,143) | (76,000) | ||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Liability, Transfers Into Level 3 | 0 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Liability, Gain (Loss) Included in Earnings | 18,705 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Currency | 0 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Liability, Settlements | 49,152 | ||||
2020 Notes Hedges [Member] | |||||
FairValueAssetsAndLiabilitiesMeasuredOnRecurringBasisUnobservableInputReconciliationTableTextBlock [Line Items] | |||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value | 102,226 | 102,226 | 0 | ||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Transfers Into Level 3 | 144,843 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Gain (Loss) Included in Earnings | (42,617) | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Settlements | 0 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Currency | 0 | ||||
2017 Notes Hedges [Member] | |||||
FairValueAssetsAndLiabilitiesMeasuredOnRecurringBasisUnobservableInputReconciliationTableTextBlock [Line Items] | |||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value | 0 | 0 | $ 80,000 | ||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Transfers Into Level 3 | 0 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Gain (Loss) Included in Earnings | (10,236) | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Settlements | (69,764) | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Currency | $ 0 | ||||
2020 Conversion Derivative [Member] | |||||
FairValueAssetsAndLiabilitiesMeasuredOnRecurringBasisUnobservableInputReconciliationTableTextBlock [Line Items] | |||||
Fair Value Assumptions, Expected Volatility Rate | 43.00% | ||||
2020 Conversion Derivative [Member] | Wright Medical Group, Inc. [Member] | |||||
FairValueAssetsAndLiabilitiesMeasuredOnRecurringBasisUnobservableInputReconciliationTableTextBlock [Line Items] | |||||
Fair Value Inputs, Entity Credit Risk | 6.40% | ||||
2017 Notes Conversion Derivative [Member] | |||||
FairValueAssetsAndLiabilitiesMeasuredOnRecurringBasisUnobservableInputReconciliationTableTextBlock [Line Items] | |||||
Fair Value Assumptions, Expected Volatility Rate | 43.00% | ||||
2017 Notes Conversion Derivative [Member] | Wright Medical Group, Inc. [Member] | |||||
FairValueAssetsAndLiabilitiesMeasuredOnRecurringBasisUnobservableInputReconciliationTableTextBlock [Line Items] | |||||
Fair Value Inputs, Entity Credit Risk | 5.40% | ||||
2020 Notes Hedges [Member] | Wright Medical Group, Inc. [Member] | |||||
FairValueAssetsAndLiabilitiesMeasuredOnRecurringBasisUnobservableInputReconciliationTableTextBlock [Line Items] | |||||
Fair Value Assumptions, Expected Volatility Rate | 43.00% | ||||
2020 Notes Hedges [Member] | DEUTSCHE BANK ATS [Member] | |||||
FairValueAssetsAndLiabilitiesMeasuredOnRecurringBasisUnobservableInputReconciliationTableTextBlock [Line Items] | |||||
Fair Value Inputs, Entity Credit Risk | 0.90% | ||||
2020 Notes Hedges [Member] | JP Morgan Chase Bank [Member] | |||||
FairValueAssetsAndLiabilitiesMeasuredOnRecurringBasisUnobservableInputReconciliationTableTextBlock [Line Items] | |||||
Fair Value Inputs, Entity Credit Risk | 0.50% | ||||
2020 Notes Hedges [Member] | WELLS FARGO LIQUIDITY CROSS ATS [Member] | |||||
FairValueAssetsAndLiabilitiesMeasuredOnRecurringBasisUnobservableInputReconciliationTableTextBlock [Line Items] | |||||
Fair Value Inputs, Entity Credit Risk | 0.70% | ||||
SSP - Distribution Business [Member] | Contingent Consideration [Member] | |||||
FairValueAssetsAndLiabilitiesMeasuredOnRecurringBasisUnobservableInputReconciliationTableTextBlock [Line Items] | |||||
Fair Value, Measurement with Unobservable Inputs Reconciliations, Recurring Basis, Liability Value | $ (1,501) | $ (1,501) |
Acquisitions (Details)
Acquisitions (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Business Acquisition [Line Items] | |||||
Goodwill | $ 190,568 | $ 190,568 | $ 190,966 | ||
Net sales | $ 80,139 | $ 71,307 | $ 238,493 | $ 214,733 |
Discontinued Operations (Detail
Discontinued Operations (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | Jan. 09, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Loss Contingency, Receivable, Period Increase (Decrease) | $ 25,000 | ||||
Loss Contingency Accrual, Period Increase (Decrease) | $ 4,000 | ||||
Goodwill, Written off Related to Sale of Business Unit | $ 25,800 | ||||
Discontinued Operation, Gain (Loss) from Disposal of Discontinued Operation, before Income Tax | 80 | $ 24,277 | |||
Purchase Price Discontinued Operations | $ 283,000 | ||||
Disposal Group, Including Discontinued Operation, Revenue | 0 | 0 | 0 | 3,056 | |
Discontinued Operation, Income (Loss) from Discontinued Operation, before Income Tax | (36,211) | (18,137) | (46,720) | (7,121) | |
Discontinued Operation, Tax Effect of Discontinued Operation | 0 | (5,977) | 0 | 7,804 | |
(Loss) Income from Discontinued Operations, Net of Tax, Attributable to Parent | $ (36,211) | $ (12,160) | $ (46,720) | $ (14,925) | |
Discontinued Operation, Gain (Loss) on Disposal of Discontinued Operation, Net of Tax, Per Basic Share | $ (0.71) | $ (0.24) | $ (0.92) | $ (0.30) | |
Discontinued Operation, Gain (Loss) on Disposal of Discontinued Operation, Net of Tax, Per Diluted Share | $ (0.71) | $ (0.24) | $ (0.92) | $ (0.30) | |
Weighted-average number of shares outstanding-basic (in shares) | 51,172 | 50,043 | 51,033 | 49,441 | |
Weighted Average Number of Shares Outstanding, Diluted | 51,172 | 50,043 | 51,033 | 49,441 | |
PROFEMUR Titanium Modular Neck Product [Member] | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Loss Contingency, Receivable, Period Increase (Decrease) | $ 25,000 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Inventory Disclosure [Abstract] | ||
Inventory Adjustments | $ 2,100 | |
Raw materials | 7,768 | $ 6,910 |
Work-in-process | 16,806 | 13,849 |
Finished goods | 86,490 | 67,653 |
Total Inventory | $ 111,064 | $ 88,412 |
Marketable Securities (Details)
Marketable Securities (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2014 | Sep. 30, 2015 | |
Marketable Securities [Abstract] | ||
Current Marketable Securities | $ 2,575 | $ 0 |
Categories of Investments, Marketable Securities, Available-for-sale Securities [Member] | ||
Schedule of Marketable Securities [Line Items] | ||
Amortized Cost | 2,575 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized (Losses) | 0 | |
Estimated Fair Value | 2,575 | |
Categories of Investments, Marketable Securities, Available-for-sale Securities [Member] | Corporate debt securities [Member] | ||
Schedule of Marketable Securities [Line Items] | ||
Amortized Cost | 566 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized (Losses) | 0 | |
Estimated Fair Value | 566 | |
Categories of Investments, Marketable Securities, Available-for-sale Securities [Member] | U.S. government debt securities [Member] | ||
Schedule of Marketable Securities [Line Items] | ||
Amortized Cost | 2,009 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized (Losses) | 0 | |
Estimated Fair Value | $ 2,009 |
Property, Plant and Equipment43
Property, Plant and Equipment, Net (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Property, Plant and Equipment, Net [Abstract] | ||
Property, plant and equipment, at cost | $ 221,602 | $ 191,094 |
Less: Accumulated depreciation | (99,152) | (86,859) |
Net property, plant and equipment | $ 122,450 | $ 104,235 |
Long-Term Debt and Capital Le44
Long-Term Debt and Capital Lease Obligations (Details) $ / shares in Units, $ in Thousands, shares in Millions | Feb. 13, 2015USD ($) | Sep. 30, 2015USD ($)$ / shares | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($)$ / sharesshares | Sep. 30, 2014USD ($) | Dec. 31, 2014USD ($) | Mar. 31, 2013 | Sep. 30, 2012USD ($) | Aug. 31, 2012USD ($) | Aug. 22, 2012USD ($) |
Debt and Capital Lease Obligations [Abstract] | ||||||||||
Debt and capital lease obligations | $ 566,340 | $ 566,340 | $ 281,330 | |||||||
Less: Current portion | (784) | (784) | (718) | |||||||
Long term debt and capital lease obligations | 565,556 | 565,556 | 280,612 | |||||||
Repayments of Debt | $ 292,000 | |||||||||
Payments for bond hedge options | $ 56,200 | |||||||||
Repayments of Convertible Debt | 240,000 | 0 | ||||||||
Write off of pro-rata unamortized deferred financing fees and for bank and legal fees | 24,746 | 0 | ||||||||
Amortization of Debt Discount (Premium) | 500 | $ 2,300 | 2,400 | 6,900 | ||||||
Derivative, Cost of Hedge | (144,843) | $ 0 | ||||||||
Capital Lease Obligations Incurred | 4,000 | |||||||||
2017convertibledebt [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Long-term debt, gross | 60,000 | 60,000 | 300,000 | $ 300,000 | ||||||
Debt Instrument, Unamortized Discount | (4,001) | (4,001) | (27,348) | |||||||
Debt and Capital Lease Obligations [Abstract] | ||||||||||
Debt and capital lease obligations | $ 55,999 | $ 55,999 | 272,652 | |||||||
Stated percentage rate | 2.00% | |||||||||
Maturity date | Aug. 15, 2017 | |||||||||
Debt Instrument, Interest Rate, Effective Percentage | 6.47% | |||||||||
Repayments of Debt | $ 240,000 | |||||||||
Debt instrument, convertible, conversion ratio | 39.3140 | |||||||||
Conversion price (in dollars per share) | $ / shares | $ 25.44 | $ 25.44 | ||||||||
Threshold for Conversion as Percent of Conversion Price | 130.00% | |||||||||
Threshold for Conversion | 98.00% | |||||||||
Debt instrument, convertible, minimum consecutive period | 20 days | |||||||||
Debt instrument, convertible, trading period | 30 days | |||||||||
Debt instrument, convertible, purchase Price as a Percent of principal amount if fundamental change event occurs | 100.00% | |||||||||
Deferred finance charges | $ 8,800 | |||||||||
Capital Lease Obligations [Member] | ||||||||||
Debt and Capital Lease Obligations [Abstract] | ||||||||||
Debt and capital lease obligations | $ 12,197 | $ 12,197 | 8,678 | |||||||
2020convertibledebt [Member] | ||||||||||
Debt Instrument [Line Items] | ||||||||||
Long-term debt, gross | $ 632,500 | |||||||||
Debt Instrument, Unamortized Discount | (134,356) | (134,356) | ||||||||
Debt and Capital Lease Obligations [Abstract] | ||||||||||
Debt and capital lease obligations | $ 498,144 | $ 498,144 | $ 0 | |||||||
Stated percentage rate | 2.00% | |||||||||
Maturity date | Feb. 15, 2020 | |||||||||
Debt Instrument, Interest Rate, Effective Percentage | 8.54% | 8.54% | ||||||||
Incremental Common Shares Attributable to Call Options and Warrants | shares | 20.5 | |||||||||
Debt instrument, convertible, conversion ratio | 32.3939 | |||||||||
Conversion price (in dollars per share) | $ / shares | $ 30.87 | $ 30.87 | ||||||||
Threshold for Conversion as Percent of Conversion Price | 130.00% | |||||||||
Debt instrument, convertible, minimum consecutive period | 20 days | |||||||||
Debt instrument, convertible, trading period | 30 days | |||||||||
Debt instrument, convertible, purchase Price as a Percent of principal amount if fundamental change event occurs | 100.00% | |||||||||
Deferred finance charges | $ 18,000 | $ 18,000 | ||||||||
Amortization of Debt Discount (Premium) | $ 6,100 | $ 15,400 | ||||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ / shares | $ 40 | $ 40 | ||||||||
2017 Notes Conversion Derivative [Member] | ||||||||||
Debt and Capital Lease Obligations [Abstract] | ||||||||||
Repayments of Debt | $ 240,000 | |||||||||
Write off of pro-rata unamortized deferred financing fees and for bank and legal fees | $ 24,700 | |||||||||
Debt Discount at Time of Issuance | $ 48,100 | |||||||||
2020 Conversion Derivative [Member] | ||||||||||
Debt and Capital Lease Obligations [Abstract] | ||||||||||
Debt Discount at Time of Issuance | $ 149,800 | |||||||||
2020 Notes Hedges [Member] | ||||||||||
Debt and Capital Lease Obligations [Abstract] | ||||||||||
Derivative, Cost of Hedge | $ 144,800 |
Derivative Instruments and He45
Derivative Instruments and Hedging Activities (Details) - USD ($) $ in Thousands | Feb. 13, 2015 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | Aug. 31, 2012 |
Derivatives, Fair Value [Line Items] | |||||||
Payments for bond hedge options | $ 56,200 | ||||||
Repayments of Debt | $ 292,000 | ||||||
Proceedsfrom2017bondhegdessettlement | 10,000 | ||||||
Non Cash Adjustment Derivative Fair Value | $ 12,022 | (2,000) | |||||
Derivative, Cost of Hedge | (144,843) | 0 | |||||
Amortization of Debt Discount (Premium) | $ 500 | $ 2,300 | 2,400 | 6,900 | |||
2017 Notes Hedges [Member] | |||||||
Derivatives, Fair Value [Line Items] | |||||||
Notes Hedges | 0 | 0 | $ 80,000 | ||||
Notes Conversion Derivative | 8,143 | 8,143 | $ 76,000 | ||||
Derivative, Gain (Loss) on Derivative, Net | 0 | (12,000) | (10,236) | (6,000) | |||
2017 Notes Conversion Derivative [Member] | |||||||
Derivatives, Fair Value [Line Items] | |||||||
Debt Discount at Time of Issuance | $ 48,100 | ||||||
Repayments of Debt | 240,000 | ||||||
Derivative, Gain (Loss) on Derivative, Net | 4,407 | 11,000 | 18,705 | 4,000 | |||
2020 Notes Hedges [Member] | |||||||
Derivatives, Fair Value [Line Items] | |||||||
Notes Hedges | 102,226 | 102,226 | |||||
Derivative, Gain (Loss) on Derivative, Net | (42,617) | (21,512) | |||||
2020 Conversion Derivative [Member] | |||||||
Derivatives, Fair Value [Line Items] | |||||||
Debt Discount at Time of Issuance | 149,800 | ||||||
Notes Conversion Derivative | 103,615 | 103,615 | |||||
Derivative, Gain (Loss) on Derivative, Net | 46,169 | 21,757 | |||||
2017 Change in Derivative Fair Value [Member] | |||||||
Derivatives, Fair Value [Line Items] | |||||||
Non Cash Adjustment Derivative Fair Value | (4,407) | $ 1,000 | (8,469) | $ 2,000 | |||
2020 Change in Derivative Fair Value [Member] | |||||||
Derivatives, Fair Value [Line Items] | |||||||
Non Cash Adjustment Derivative Fair Value | (245) | (3,552) | |||||
2020convertibledebt [Member] | |||||||
Derivatives, Fair Value [Line Items] | |||||||
Proceeds from Issuance of Debt | 613,000 | ||||||
Amortization of Debt Discount (Premium) | $ 6,100 | $ 15,400 | |||||
2020 Notes Hedges [Member] | |||||||
Derivatives, Fair Value [Line Items] | |||||||
Derivative, Cost of Hedge | $ 144,800 |
Goodwill and Intangible Asset46
Goodwill and Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2015 | Dec. 31, 2014 | |
Finite And Indefinite Lived Intangible Assets [Line Items] | |||
Intangible Assets, Gross, Excluding Goodwill | $ 94,868 | $ 94,868 | $ 90,030 |
Less: Accumulated Amortization | 26,560 | 26,560 | 21,005 |
Intangible assets, net | 68,308 | 68,308 | 69,025 |
Goodwill [Roll Forward] | |||
Goodwill at December 31, 2013 | 190,966 | ||
Foreign currency translation | (4,285) | ||
Goodwill at March 31, 2014 | 190,568 | 190,568 | |
Goodwill, Acquired During Period | 3,887 | ||
Future amortization [Abstract] | |||
2,014 | 10,200 | 10,200 | |
2,015 | 8,900 | 8,900 | |
2,016 | 8,300 | 8,300 | |
2,017 | 6,600 | 6,600 | |
2,018 | 6,000 | 6,000 | |
Indefinite-Lived Intangible Assets Member | |||
Finite And Indefinite Lived Intangible Assets [Line Items] | |||
Indefinite life intangibles | 3,951 | 3,951 | 8,270 |
Finite-Lived Intangible Assets [Member] | |||
Finite And Indefinite Lived Intangible Assets [Line Items] | |||
Definite life intangibles, cost | 90,917 | 90,917 | 81,760 |
Less: Accumulated Amortization | 26,560 | 26,560 | 21,005 |
Developed Technology Rights [Member] | Indefinite-Lived Intangible Assets Member | |||
Finite And Indefinite Lived Intangible Assets [Line Items] | |||
Indefinite life intangibles | 0 | 0 | 4,266 |
Developed Technology Rights [Member] | Finite-Lived Intangible Assets [Member] | |||
Finite And Indefinite Lived Intangible Assets [Line Items] | |||
Definite life intangibles, cost | 37,001 | 37,001 | 33,253 |
Less: Accumulated Amortization | 11,786 | 11,786 | 9,185 |
Trademarks [Member] | Indefinite-Lived Intangible Assets Member | |||
Finite And Indefinite Lived Intangible Assets [Line Items] | |||
Indefinite life intangibles | 3,951 | 3,951 | 4,004 |
Trademarks [Member] | Finite-Lived Intangible Assets [Member] | |||
Finite And Indefinite Lived Intangible Assets [Line Items] | |||
Definite life intangibles, cost | 2,756 | 2,756 | 2,798 |
Less: Accumulated Amortization | 2,416 | 2,416 | 1,850 |
Distribution Rights [Member] | Finite-Lived Intangible Assets [Member] | |||
Finite And Indefinite Lived Intangible Assets [Line Items] | |||
Definite life intangibles, cost | 250 | 250 | 250 |
Less: Accumulated Amortization | 212 | 212 | 194 |
Licensing Agreements [Member] | Finite-Lived Intangible Assets [Member] | |||
Finite And Indefinite Lived Intangible Assets [Line Items] | |||
Definite life intangibles, cost | 8,233 | 8,233 | 8,234 |
Less: Accumulated Amortization | 2,128 | 2,128 | 1,637 |
Customer Relationships [Member] | Finite-Lived Intangible Assets [Member] | |||
Finite And Indefinite Lived Intangible Assets [Line Items] | |||
Definite life intangibles, cost | 32,661 | 32,661 | 27,946 |
Less: Accumulated Amortization | 6,284 | 6,284 | 4,636 |
Noncompete Agreements [Member] | Finite-Lived Intangible Assets [Member] | |||
Finite And Indefinite Lived Intangible Assets [Line Items] | |||
Definite life intangibles, cost | 8,785 | 8,785 | 8,508 |
Less: Accumulated Amortization | 3,593 | 3,593 | 3,397 |
Other Intangible Assets [Member] | Finite-Lived Intangible Assets [Member] | |||
Finite And Indefinite Lived Intangible Assets [Line Items] | |||
Definite life intangibles, cost | 1,231 | 1,231 | 771 |
Less: Accumulated Amortization | 141 | 141 | $ 106 |
UNITED STATES | |||
Goodwill [Roll Forward] | |||
Goodwill, Acquired During Period | 0 | ||
International Segment [Member] | |||
Goodwill [Roll Forward] | |||
Goodwill, Acquired During Period | 3,887 | ||
BioMimetics [Member] | |||
Goodwill [Roll Forward] | |||
Goodwill, Acquired During Period | 0 | ||
BioMimetics [Member] | |||
Goodwill [Roll Forward] | |||
Goodwill at December 31, 2013 | 1,336 | ||
Foreign currency translation | 0 | ||
Goodwill at March 31, 2014 | 1,336 | 1,336 | |
International Segment [Member] | |||
Goodwill [Roll Forward] | |||
Goodwill at December 31, 2013 | 16,041 | ||
Foreign currency translation | (4,285) | ||
Goodwill at March 31, 2014 | 15,643 | 15,643 | |
UNITED STATES | |||
Goodwill [Roll Forward] | |||
Goodwill at December 31, 2013 | 173,589 | ||
Foreign currency translation | 0 | ||
Goodwill at March 31, 2014 | 173,589 | 173,589 | |
SSP - Distribution Business [Member] | |||
Finite And Indefinite Lived Intangible Assets [Line Items] | |||
Payments to Acquire Businesses, Gross | 4,900 | ||
Other Payments to Acquire Businesses | 4,900 | ||
Goodwill [Roll Forward] | |||
Finite-lived Intangible Assets Acquired | 8,200 | ||
Goodwill, Acquired During Period | 3,900 | ||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Deferred Tax Liabilities Noncurrent | $ 2,500 | $ 2,500 |
Accumulated Other Comprehensi47
Accumulated Other Comprehensive Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Schedule of Accumulated Other Comprehensive Income(Loss) [Line Items] | |||||
Accumulated other comprehensive income (loss), net of tax | $ (4,895) | $ (4,895) | $ 2,398 | ||
Other Comprehensive Income Loss Before Reclassifications Net Of Tax | (7,293) | $ (11,636) | |||
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Reclassification Adjustment from AOCI, Realized upon Sale or Liquidation, Net of Tax | 0 | $ 0 | 0 | $ (2,628) | |
Accumulated Translation Adjustment [Member] | |||||
Schedule of Accumulated Other Comprehensive Income(Loss) [Line Items] | |||||
Accumulated other comprehensive income (loss), net of tax | $ (4,895) | (4,895) | $ 2,398 | ||
Other Comprehensive Income Loss Before Reclassifications Net Of Tax | $ (7,293) |
Changes in Stockholders' Equi48
Changes in Stockholders' Equity (Details) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | Jun. 30, 2014 | Dec. 31, 2013 | |
Stockholders' Equity Attributable to Parent | $ 113,971 | $ 113,971 | $ 278,803 | $ 382,904 | $ 459,714 | ||
Net (loss) income | (98,861) | $ (61,807) | (192,924) | $ (148,453) | |||
Other Comprehensive Income Loss Before Reclassifications Net Of Tax | (7,293) | (11,636) | |||||
Reclassification of gain on equity securities, net of taxes of $1 and $3,041, respectively | 2 | ||||||
Other Comprehensive (Income) Loss, Pension and Other Postretirement Benefit Plans, Adjustment, Net of Tax | 0 | 0 | 0 | (344) | |||
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Reclassification Adjustment from AOCI, Realized upon Sale or Liquidation, Net of Tax | $ 0 | $ 0 | 0 | 2,628 | |||
Stock Issued During Period, Value, New Issues | 3,090 | 26,376 | |||||
Adjustments to Additional Paid in Capital, Share-based Compensation and Exercise of Stock Options | 7,720 | $ 13,174 | |||||
Adjustments to Additional Paid in Capital, Warrant Issued | $ 24,575 | ||||||
Common Stock [Member] | |||||||
Common Stock, Shares, Outstanding | 51,471,807 | 51,471,807 | 51,326,696 | 50,844,255 | 47,993,765 | ||
Stockholders' Equity Attributable to Parent | $ 512 | $ 512 | $ 509 | $ 504 | $ 473 | ||
Stock Issued During Period, Shares, New Issues | 133,544 | 1,183,055 | |||||
Stock Issued During Period, Value, New Issues | $ 1 | $ 13 | |||||
Stock Issued During Period, Shares, Restricted Stock Award, Gross | 5,092 | 243,228 | |||||
Stock Issued During Period, Shares, Restricted Stock Award, Forfeited | (5,695) | (21,541) | |||||
Stock Issued During Period, Shares, Share-based Compensation, Net of Forfeitures | 12,170 | 81,116 | |||||
Stock Issued During Period, Value, Share-based Compensation, Net of Forfeitures | $ 2 | $ 5 | |||||
Additional Paid-in Capital [Member] | |||||||
Stockholders' Equity Attributable to Parent | 786,443 | 786,443 | 751,061 | 737,732 | 656,770 | ||
Stock Issued During Period, Value, New Issues | 3,089 | 26,363 | |||||
Stock Issued During Period, Value, Share-based Compensation, Net of Forfeitures | (2) | (5) | |||||
Adjustments to Additional Paid in Capital, Share-based Compensation and Exercise of Stock Options | 7,720 | 13,174 | |||||
Adjustments to Additional Paid in Capital, Warrant Issued | 24,575 | ||||||
Retained Earnings [Member] | |||||||
Stockholders' Equity Attributable to Parent | (668,089) | (668,089) | (475,165) | (363,935) | (215,482) | ||
Accumulated Translation Adjustment [Member] | |||||||
Stockholders' Equity Attributable to Parent | $ (4,895) | (4,895) | $ 2,398 | $ 8,603 | $ 17,953 | ||
Other Comprehensive Income Loss Before Reclassifications Net Of Tax | (7,293) | (11,636) | |||||
Solana [Member] | |||||||
Stock Issued During Period, Value, New Issues | $ 41,443 | ||||||
Solana [Member] | Common Stock [Member] | |||||||
Stock Issued During Period, Shares, New Issues | 1,364,632 | ||||||
Stock Issued During Period, Value, New Issues | $ 13 | ||||||
Solana [Member] | Additional Paid-in Capital [Member] | |||||||
Stock Issued During Period, Value, New Issues | 41,430 | ||||||
Unrealized Gain(Loss) Marketable Securities [Member] | Other Comprehensive Income (Loss) [Member] | |||||||
Reclassification of gain on equity securities, net of taxes of $1 and $3,041, respectively | 2 | ||||||
Minimum Pension Liability [Member] | Other Comprehensive Income (Loss) [Member] | |||||||
Other Comprehensive (Income) Loss, Pension and Other Postretirement Benefit Plans, Adjustment, Net of Tax | 344 | ||||||
Accumulated Translation Adjustment [Member] | |||||||
Other Comprehensive Income Loss Before Reclassifications Net Of Tax | $ (7,293) | ||||||
Accumulated Translation Adjustment [Member] | Other Comprehensive Income (Loss) [Member] | |||||||
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Reclassification Adjustment from AOCI, Realized upon Sale or Liquidation, Net of Tax | $ (2,628) |
Earnings Per Share (Details)
Earnings Per Share (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Earnings Per Share [Abstract] | ||||
Anti-dilutive common stock equivalents excluded from diluted earnings per share computation as a result of net loss | 600 | 1,600 | 700 | 1,500 |
Weighted-average number of shares outstanding-basic (in shares) | 51,172 | 50,043 | 51,033 | 49,441 |
Common stock equivalents | 0 | 0 | 0 | 0 |
Weighted-average number of shares outstanding, diluted | 51,172 | 50,043 | 51,033 | 49,441 |
Stock options | 698 | 843 | 709 | 566 |
Non-vested shares, restricted stock units, and stock-settled phantom stock units | 139 | 1 | 9 | 12 |
Convertible debt | 0 | 115 | 0 | 115 |
Commitments and Contingencies -
Commitments and Contingencies - Product Liability Contingency (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Jun. 30, 2013 | Mar. 31, 2013 | Sep. 30, 2015 | |
Product Liability Contingency [Line Items] | |||||
Loss Contingency Accrual, Period Increase (Decrease) | $ 4,000 | ||||
Third Party Recovery | $ 10,000 | $ 5,000 | $ 5,000 | ||
Insurance Recovery Cash Spend | 25,000 | ||||
Loss Contingency, Receivable, Period Increase (Decrease) | 25,000 | ||||
Product Liability Contingency, Third Party Recovery | 4,100 | ||||
Product Liability Accrual, Component Amount | 4,400 | 4,400 | |||
Product Liability Costs in Excess of Threshold | 18,400 | ||||
PROFEMUR Titanium Modular Neck Product [Member] | |||||
Product Liability Contingency [Line Items] | |||||
Estimated product liability range, minimum | 19,000 | 19,000 | |||
Estimated product liability range, maximum | 24,800 | 24,800 | |||
Product Liability Accrual, Net | 19,000 | 19,000 | |||
Product Liability, current | 5,000 | 5,000 | |||
Product Liability, non current | 14,000 | 14,000 | |||
Increase Decrease in Estimated Recovery from Third Party | $ 19,400 | ||||
Estimated Recovery from Third Party, Current | 0 | 25,000 | |||
Loss Contingency, Receivable, Period Increase (Decrease) | $ 25,000 | ||||
Maximum Estimated Third Party Recovery | 40,000 | ||||
CONSERVE (R) Metal-on-metal [Member] | |||||
Product Liability Contingency [Line Items] | |||||
Product Liability Contingency, Third Party Recovery | $ 14,800 |
Segment Information (Details)
Segment Information (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Dec. 31, 2014USD ($) | |
Segment Reporting Information [Line Items] | |||||
Assets | $ 965,535 | $ 965,535 | $ 892,676 | ||
Net sales | 80,139 | $ 71,307 | 238,493 | $ 214,733 | |
Depreciation | 16,966 | 13,617 | |||
Operating Income (Loss) | (41,042) | (20,649) | (108,505) | (72,866) | |
InventoryStepUpAmortizationExpense | (20) | (302) | (69) | (1,521) | |
DistributorConversionCharges | (16) | (478) | (65) | (1,698) | |
Payments for Legal Settlements | (900) | ||||
Management Changes | (1,203) | ||||
Business Combination, Acquisition Related Costs, Transition Costs | (19,887) | (2,740) | (43,040) | (16,030) | |
Interest Expense Income, Net | 11,185 | 4,565 | 29,793 | 12,873 | |
Other Nonoperating Income (Expense) | 10,236 | 21,430 | 7,395 | 54,986 | |
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Extraordinary Items, Noncontrolling Interest | (62,463) | (46,644) | (145,693) | (140,725) | |
Payments to Acquire Property, Plant, and Equipment | 8,259 | 11,422 | 34,013 | 35,706 | |
Capital Expenditures, Continuing Operations | 35,706 | ||||
UNITED STATES | |||||
Segment Reporting Information [Line Items] | |||||
Assets | 437,509 | 437,509 | 450,055 | ||
Net sales | 60,394 | 51,297 | 176,150 | 149,591 | |
Depreciation | $ 3,500 | 2,414 | $ 9,693 | 7,093 | |
Sales Revenue Goods Net Percent Change | 17.70% | 17.80% | |||
AmortizationExpenseWithoutDistributorConversion | $ 2,025 | 1,293 | $ 6,132 | 3,820 | |
Segment Operating Loss | 2,219 | 6,448 | 8,021 | 12,914 | |
Payments to Acquire Property, Plant, and Equipment | 7,154 | 4,267 | 30,361 | ||
Capital Expenditures, Continuing Operations | 13,464 | ||||
International Segment [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Assets | 115,976 | 115,976 | 94,412 | ||
Net sales | 19,745 | 20,010 | 62,343 | 65,142 | |
Depreciation | 827 | 841 | 2,330 | 2,246 | |
AmortizationExpenseWithoutDistributorConversion | 469 | 547 | 1,402 | 1,663 | |
Segment Operating Loss | (2,627) | (3,213) | (8,658) | (2,385) | |
Payments to Acquire Property, Plant, and Equipment | 1,094 | 3,290 | 3,572 | ||
Capital Expenditures, Continuing Operations | 7,597 | ||||
BioMimetics [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Assets | 21,609 | 21,609 | 17,924 | ||
Net sales | 0 | 0 | 0 | 0 | |
Depreciation | 46 | 108 | 127 | 324 | |
AmortizationExpenseWithoutDistributorConversion | 52 | 77 | 142 | 231 | |
Segment Operating Loss | (3,952) | (2,601) | (11,051) | (9,385) | |
Payments to Acquire Property, Plant, and Equipment | 11 | 0 | 55 | ||
Capital Expenditures, Continuing Operations | 39 | ||||
Europe [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | $ 10,718 | 11,180 | $ 34,951 | 36,615 | |
Sales Revenue Goods Net Percent Change | (4.10%) | (4.50%) | |||
Other Geographical Areas [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | $ 9,027 | 8,830 | $ 27,392 | 28,527 | |
Sales Revenue Goods Net Percent Change | 2.20% | (4.00%) | |||
Corporate Segment [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Assets | $ 390,441 | $ 390,441 | 330,285 | ||
Net sales | 0 | 0 | 0 | 0 | |
Depreciation | 1,895 | 1,291 | 4,816 | 3,831 | |
AmortizationExpenseWithoutDistributorConversion | 0 | 0 | 0 | 1 | |
Segment Operating Loss | (16,759) | (15,660) | (53,643) | (52,658) | |
Payments to Acquire Property, Plant, and Equipment | 0 | 3,865 | $ 25 | ||
Capital Expenditures, Continuing Operations | 14,606 | ||||
Segment [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Number of Reportable Segments | 3 | ||||
Assets | 965,535 | $ 965,535 | 892,676 | ||
Net sales | 80,139 | 71,307 | 238,493 | 214,733 | |
Depreciation | $ 6,268 | 4,654 | $ 16,966 | 13,494 | |
Sales Revenue Goods Net Percent Change | 12.40% | 11.10% | |||
AmortizationExpenseWithoutDistributorConversion | $ 2,546 | 1,917 | $ 7,676 | 5,715 | |
Segment Operating Loss | (21,119) | $ (15,026) | (65,331) | $ (51,514) | |
Payments to Acquire Property, Plant, and Equipment | 34,013 | ||||
All Countries [Domain] | |||||
Segment Reporting Information [Line Items] | |||||
Disclosure on Geographic Areas, Long-Lived Assets | 122,450 | 122,450 | 104,235 | ||
Other Geographical Areas [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Disclosure on Geographic Areas, Long-Lived Assets | 3,291 | 3,291 | 3,348 | ||
Europe [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Disclosure on Geographic Areas, Long-Lived Assets | 8,165 | 8,165 | 8,065 | ||
UNITED STATES | |||||
Segment Reporting Information [Line Items] | |||||
Disclosure on Geographic Areas, Long-Lived Assets | $ 110,994 | $ 110,994 | $ 92,822 |
Subsequent Event (Details)
Subsequent Event (Details) - USD ($) $ in Millions | Oct. 01, 2015 | Sep. 30, 2015 | Sep. 30, 2015 |
Subsequent Event [Line Items] | |||
Subsequent Event, Date | Oct. 1, 2015 | ||
Completion of merger with Tornier [Member] | |||
Subsequent Event [Line Items] | |||
Common Stock, Conversion Features | 1.0309 | ||
Stock Issued During Period, Shares, New Issues | 53,080,978 | ||
Stock Issued | $ 1,100 | ||
Common Stock, Call or Exercise Features | 20.67 | ||
Business Acquisition, Pro Forma Revenue | $ 152.1 | $ 484.7 | |
Revenue excluded due to Divestiture | $ 3 | $ 9.9 |
Uncategorized Items - wmgi-2015
Label | Element | Value |
Consolidated Cash and Equivalents, at Carrying Value | wmgi_ConsolidatedCashandEquivalentsatCarryingValue | $ 273,031 |