Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2018 | Aug. 02, 2018 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | Sientra, Inc. | |
Entity Central Index Key | 1,551,693 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2018 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 28,427,655 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q2 | |
Trading Symbol | SIEN |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 112,619 | $ 26,588 |
Accounts receivable, net of allowances of $1,393 and $4,816 at June 30, 2018 and December 31, 2017, respectively | 16,330 | 6,569 |
Inventories, net | 22,487 | 20,896 |
Prepaid expenses and other current assets | 6,516 | 1,512 |
Total current assets | 157,952 | 55,565 |
Property and equipment, net | 2,247 | 4,763 |
Goodwill | 12,507 | 12,507 |
Other intangible assets, net | 17,646 | 18,803 |
Other assets | 708 | 575 |
Total assets | 191,060 | 92,213 |
Current liabilities: | ||
Current portion of long-term debt | 6,663 | 24,639 |
Accounts payable | 11,637 | 5,811 |
Accrued and other current liabilities | 22,337 | 13,474 |
Legal settlement payable | 1,000 | |
Customer deposits | 6,025 | 5,423 |
Sales return liability | 4,882 | |
Total current liabilities | 51,544 | 50,347 |
Long-term debt | 28,032 | |
Deferred and contingent consideration | 6,070 | 12,597 |
Warranty reserve and other long-term liabilities | 2,500 | 1,646 |
Total liabilities | 88,146 | 64,590 |
Commitments and contingencies (Note 12) | ||
Stockholders’ equity: | ||
Preferred stock, $0.01 par value – Authorized 10,000,000 shares; none issued or outstanding | ||
Common stock, $0.01 par value — Authorized 200,000,000 shares; issued 28,390,271 and 19,474,702 and outstanding 28,317,544 and 19,401,975 shares at June 30, 2018 and December 31, 2017 respectively | 284 | 194 |
Additional paid-in capital | 419,811 | 307,159 |
Treasury stock, at cost (72,727 shares at June 30, 2018 and December 31, 2017) | (260) | (260) |
Accumulated deficit | (316,921) | (279,470) |
Total stockholders’ equity | 102,914 | 27,623 |
Total liabilities and stockholders’ equity | $ 191,060 | $ 92,213 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Statement Of Financial Position [Abstract] | ||
Accounts receivable, allowances (in dollars) | $ 1,393 | $ 4,816 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common stock, shares issued | 28,390,271 | 19,474,702 |
Common stock, shares outstanding | 28,317,544 | 19,401,975 |
Treasury stock, shares | 72,727 | 72,727 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Income Statement [Abstract] | ||||
Net sales | $ 17,554,000 | $ 8,169,000 | $ 32,229,000 | $ 15,658,000 |
Cost of goods sold | 6,660,000 | 2,621,000 | 12,756,000 | 4,942,000 |
Gross profit | 10,894,000 | 5,548,000 | 19,473,000 | 10,716,000 |
Operating expenses: | ||||
Sales and marketing | 15,477,000 | 6,163,000 | 30,733,000 | 13,119,000 |
Research and development | 2,301,000 | 1,573,000 | 5,052,000 | 4,766,000 |
General and administrative | 10,014,000 | 8,022,000 | 19,514,000 | 14,458,000 |
Legal settlement | 10,000,000 | 10,000,000 | ||
Total operating expenses | 27,792,000 | 25,758,000 | 55,299,000 | 42,343,000 |
Loss from operations | (16,898,000) | (20,210,000) | (35,826,000) | (31,627,000) |
Other income (expense), net: | ||||
Interest income | 40,000 | 37,000 | 80,000 | 59,000 |
Interest expense | (867,000) | (185,000) | (1,521,000) | (194,000) |
Other income (expense), net | (303,000) | (4,000) | (184,000) | 4,000 |
Total other income (expense), net | (1,130,000) | (152,000) | (1,625,000) | (131,000) |
Loss before income taxes | (18,028,000) | (20,362,000) | (37,451,000) | (31,758,000) |
Income tax expense | 0 | 29,000 | 0 | 54,000 |
Net loss | $ (18,028,000) | $ (20,391,000) | $ (37,451,000) | $ (31,812,000) |
Basic and diluted net loss per share attributable to common stockholders | $ (0.73) | $ (1.07) | $ (1.69) | $ (1.68) |
Weighted average outstanding common shares used for net loss per share attributable to common stockholders: | ||||
Basic and diluted | 24,761,117 | 19,132,052 | 22,202,565 | 18,953,500 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Cash flows from operating activities: | ||
Net loss | $ (37,451) | $ (31,812) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 1,700 | 1,159 |
Provision for doubtful accounts | 489 | 27 |
Provision for warranties | 572 | 119 |
Provision for inventory | 709 | (50) |
Amortization of acquired inventory step-up | 106 | 417 |
Change in fair value of warrants | 164 | 83 |
Change in fair value of deferred consideration | 18 | (14) |
Change in fair value of contingent consideration | 1,708 | 463 |
Change in deferred revenue | (161) | |
Amortization of debt discount and issuance costs | 85 | 144 |
Stock-based compensation expense | 5,686 | 3,182 |
Loss on disposal of property and equipment | 12 | |
Deferred income taxes | 54 | |
Changes in assets and liabilities, net of effects from acquisitions: | ||
Accounts receivable | (6,343) | 47 |
Inventories | (2,405) | 1,716 |
Prepaid expenses, other current assets and other assets | (2,518) | (2,395) |
Insurance recovery receivable | 33 | 9,277 |
Accounts payable | 4,230 | (1,264) |
Accrued and other liabilities | 1,643 | 4,648 |
Legal settlement payable | (1,000) | (900) |
Customer deposits | 602 | (697) |
Sales return liability | 976 | |
Net cash used in operating activities | (31,157) | (15,784) |
Cash flows from investing activities: | ||
Purchase of property and equipment | (160) | (1,580) |
Net cash used in investing activities | (160) | (1,580) |
Cash flows from financing activities: | ||
Proceeds from exercise of stock options | 410 | 1,096 |
Proceeds from issuance of common stock under ESPP | 391 | 324 |
Tax payments related to shares withheld for vested restricted stock units (RSUs) | (1,297) | (569) |
Net proceeds from issuance of common stock | 107,850 | |
Gross borrowings under the Term Loan | 10,000 | |
Gross borrowings under the Revolving Loan | 12,109 | 5,000 |
Repayment of the Revolving Loan | (12,109) | |
Deferred financing costs | (6) | (204) |
Net cash provided by financing activities | 117,348 | 5,647 |
Net increase (decrease) in cash and cash equivalents | 86,031 | (11,717) |
Cash and cash equivalents at: | ||
Beginning of period | 26,588 | 67,212 |
End of period | 112,619 | 55,495 |
Supplemental disclosure of cash flow information: | ||
Interest paid | 1,347 | 50 |
Supplemental disclosure of non-cash investing and financing activities: | ||
Property and equipment in accounts payable and accrued liabilities | 1,741 | $ 461 |
Deferred follow-on offering costs in accounts payable and accrued liabilities | $ 299 |
Formation and Business of the C
Formation and Business of the Company | 6 Months Ended |
Jun. 30, 2018 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Formation and Business of the Company | 1. a. Formation Sientra, Inc. (“Sientra”, the “Company,” “we,” “our” or “us”), was incorporated in the State of Delaware on August 29, 2003 under the name Juliet Medical, Inc. and subsequently changed its name to Sientra, Inc. in April 2007. The Company acquired substantially all the assets of Silimed, Inc. on April 4, 2007. The purpose of the acquisition was to acquire the rights to the silicone breast implant clinical trials, related product specifications and pre-market approval, or PMA, assets. Following this acquisition, the Company focused on completing the clinical trials to gain FDA approval to offer its silicone gel breast implants in the United States. In March 2012, the Company announced it had received approval from the FDA for its portfolio of silicone gel breast implants, and in the second quarter of 2012 the Company began commercialization efforts to sell its products in the United States. The Company, based in Santa Barbara, California, is a medical aesthetics company that focuses on serving board-certified plastic surgeons and offers a portfolio of silicone shaped and round breast implants, scar management, tissue expanders, and body contouring products. In November 2014, the Company completed an initial public offering, or IPO, and its common stock is listed on the Nasdaq Stock Exchange under the symbol “SIEN.” b. Acquisition of miraDry On June 11, 2017, Sientra entered into an Agreement and Plan of Merger, or the Merger Agreement, with miraDry, (formerly Miramar Labs), pursuant to which Sientra commenced a tender offer to purchase all of the outstanding shares of miraDry’s common stock for (i) $0.3149 per share, plus (ii) the contractual right to receive one or more contingent payments upon the achievement of certain future sales milestones. The total merger consideration was $18.7 million in upfront cash and the contractual rights represent potential contingent payments of up to $14 million. The transaction, which closed on July 25, 2017, added the miraDry System to Sientra’s aesthetics portfolio. c. Regulatory Review of Vesta Manufacturing The Company has engaged Vesta Intermediate Funding, Inc., or Vesta, a Lubrizol Lifesciences company, for the manufacture and supply of the Company’s breast implants. On March 14, 2017, the Company announced it had submitted a site-change pre-market approval, or PMA supplement, to the FDA for the manufacture of the Company’s PMA-approved breast implants at the Vesta manufacturing facility. On January 30, 2018, the Company announced the FDA has granted approval of the site-change pre-market approval, or PMA, supplement for the Company’s contract manufacturer, Vesta, to manufacture its silicone gel breast implants. In support of the move to the Vesta manufacturing facility, the Company also implemented new manufacturing process improvements which, in consultation with the FDA, required three (3) additional PMA submissions. In addition to approving the manufacturing site-change supplement, the FDA has approved our three (3) process enhancement submissions on . d. Follow-On Offering On May 7, 2018, the Company completed an underwritten follow-on public offering of 7,407,408 shares of its common stock at $13.50 per share, as well as 1,111,111 additional shares of its common stock pursuant to the full exercise of the over-allotment option granted to the underwriters. Net proceeds to the Company were approximately $107.6 million after deducting underwriting discounts and commissions of $6.9 million and offering expenses of approximately $0.5 million. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. a. Basis of Presentation The accompanying unaudited condensed consolidated financial statements in this Quarterly Report on Form 10-Q have been prepared in accordance with accounting principles generally accepted in the United States of America, or GAAP, and the rules and regulations of the U.S. Securities and Exchange Commission, or SEC. Accordingly, they do not include certain footnotes and financial presentations normally required under accounting principles generally accepted in the United States of America for complete financial reporting. The interim financial information is unaudited, but reflects all normal adjustments and accruals which are, in the opinion of management, considered necessary to provide a fair presentation for the interim periods presented. The accompanying condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 filed with the SEC on March 13, 2018 and Form 10-K/A filed on April 30, 2018, or the Annual Report. The results for the three and six months ended June 30, 2018 are not necessarily indicative of results to be expected for the year ending December 31, 2018, any other interim periods, or any future year or period. b. Liquidity Since the Company’s inception, it has incurred significant net operating losses and the Company anticipates that losses will continue in the near term. The Company expects its operating expenses will continue to grow as they expand operations. The Company will need to generate significant net sales to achieve profitability. To date, the Company has funded operations primarily with proceeds from the sales of preferred stock, borrowings under term loans, sales of products since 2012, and the proceeds from the sale of common stock in public offerings. The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which implies the Company will continue to realize its assets and discharge its liabilities in the normal course of business. As of June 30, 2018, the Company had cash and cash equivalents of $112.6 million. Since inception, the Company has incurred recurring losses from operations and cash outflows from operating activities. The continuation of the Company as a going concern is dependent upon many factors including liquidity and the ability to raise capital The Company received FDA approval of their PMA supplement on April 17, 2018 and was then able to access a $10.0 million term loan pursuant to an amendment to the credit agreement with MidCap Financial Trust, or MidCap. In addition, in February 2018, the Company entered into an At-The-Market Equity Offering Sales Agreement with Stifel, Nicolaus & Company, Incorporated, or Stifel, as sales agent pursuant to which the Company may sell, from time to time, through Stifel, shares of our common stock having an aggregate gross offering price of up to $50 million. . Further, on after deducting underwriting discounts and commissions and other offering expenses. The Company believes that its cash and cash equivalents will be sufficient to fund its operations for at least the next 12 months. , the Company may need to raise additional capital in the future through the sale of equity securities and incremental debt financing. c. Use of Estimates The preparation of the condensed consolidated financial statements, in conformity with GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. d. Significant Accounting Policies Revenue Recognition The Company recognizes revenue when the Company transfers control of promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled to in exchange for those goods or services. See Note 3 - Revenue for further discussion. There have been no other changes to the accounting policies during the three and six months ended June 30, 2018, as compared to the significant accounting policies described in the “Notes to Financial Statements” in the Annual Report. e. Recent Accounting Pronouncements Recently Adopted Accounting Standards In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers Topic 606). Revenue Recognition In accordance with Topic 606 disclosure requirements, the impact of adoption on our condensed consolidated balance sheet was as follows (in thousands): As Reported Total Adjusted December 31, 2017 Adjustment January 1, 2018 Balance Sheet Assets Accounts receivable, net of allowances $ 6,569 3,906 10,475 Liabilities Sales return liability $ — 3,906 3,906 As Reported Total Amounts Under June 30, 2018 Adjustment Previous Standards Balance Sheet Assets Accounts receivable, net of allowances $ 16,330 (4,882 ) 11,448 Liabilities Sales return liability $ 4,882 (4,882 ) — Additionally, in accordance with Topic 606, the balance of breast product inventory estimated to be returned as of June 30, 2018 is included in the components of the Company’s inventory as “finished goods – right of return” in Note 9b - Inventories. Prior to the adoption of Topic 606, the inventory impact of estimated returns for breast products was included in the “finished goods” inventory balance and was not separately disclosed. The adoption of Topic 606 did not have a material impact on our condensed consolidated statement of operations. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows – Classifications of Certain Cash Receipts and Cash Payments (Topic 230) The ASU requires a retrospective approach to adoption. The Company adopted the ASU in the first quarter of 2018. In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805) - Clarifying the Definition of a Business . The standard The Company adopted the ASU in the first quarter of 2018 on prospective basis. The adoption of this ASU did not have a material impact on the Company’s condensed consolidated financial statements. In May 2017, the FASB issued ASU 2017-09, Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting The standard provides clarification on when modification accounting should be used for changes to the terms or conditions of a share-based payment award Recently Issued Accounting Standards In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) Leases (Topic 840). In February 2018, the FASB issued ASU 2018-02, Income Taxes (Topic 740) In June 2018, the FASB issued ASU 2018-07, Compensation - Stock Compensation (Topic 718), f. Reclassifications Certain reclassifications have been made to prior year amounts to conform to the current year presentation. |
Revenue
Revenue | 6 Months Ended |
Jun. 30, 2018 | |
Revenue From Contract With Customer [Abstract] | |
Revenue | 3. Revenue Revenue Recognition The Company generates revenue primarily through the sale and delivery of promised goods or services to customers and recognizes revenue when control is transferred to customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for the goods or services. Sales prices are documented in the executed sales contract or purchase order prior to the transfer of control to the customer. Customers may enter into a separate extended service agreement to purchase an extended warranty for miraDry products from the Company whereby the payment is due at the inception of the agreement. Revenue for extended service agreements are recognized ratably over the term of the agreements. The Company also leverages a distributor network for selling the miraDry System internationally. The Company recognizes revenue when control of the goods or services is transferred to the distributors. Standard terms in these agreements do not allow for trial periods, right of return, refunds, payment contingent on obtaining financing or other terms that could impact the customer’s payment obligation. A portion of the Company’s revenue is generated from the sale of consigned inventory of breast implants maintained at doctor, hospital, and clinic locations. For these products, revenue is recognized at the time the Company is notified by the customer that the product has been implanted, not when the consigned products are delivered to the customer’s location. For Breast Products, with the exception of the Company’s BIOCORNEUM scar management products, the Company allows for the return of products from customers within six months after the original sale, which is accounted for as variable consideration. Appropriate reserves are established for anticipated sales returns based on the expected amount calculated with historical experience, recent gross sales and any notification of pending returns. The estimated sales return is recorded as a reduction of revenue and as a refund liability in the same period revenue is recognized. Actual sales returns in any future period are inherently uncertain and thus may differ from the estimates. If actual sales returns differ significantly from the estimates, an adjustment to revenue in the current or subsequent period would be recorded. The Company has established an allowance for sales returns of $4.9 million and $3.9 million as of June 30, 2018 and December 31, 2017, respectively, recorded as “sales return liability” on the condensed consolidated balance sheet under Topic 606 as of June 30, 2018 and recorded in “accounts receivable, net of allowances,” at December 31, 2017 on the condensed consolidated balance sheet, as indicated above in “ Sales tax, value-added tax, and other taxes the Company may collect concurrent with revenue-producing activities are excluded from the measurement of the transaction price and thus from revenue. Arrangements with Multiple Performance Obligations The Company has determined that the delivery of each unit of product in the Company’s revenue contracts with customers is a separate performance obligation. The Company’s revenue contracts may include multiple products, each of which is considered a separate performance obligation. For such arrangements, the Company allocates revenue to each performance obligation based on its relative standalone selling price. The Company generally determines standalone selling prices based on observable prices or using an expected cost plus margin approach when an observable price is not available. The Company invoices customers once products are shipped or delivered to customers depending on the negotiated shipping terms. Practical Expedients and Policy Election The Company generally expenses sales commissions when incurred because the amortization period would have been one year or less. These costs are recorded within sales and marketing expenses. The Company does not adjust accounts receivable for the effects of any significant financing components as customer payment terms are generally shorter than one year. The Company has elected to account for shipping and handling activities performed after a customer obtains control of the products as activities to fulfill the promise to transfer the products to the customer. Shipping and handling activities are largely provided to customers free of charge for the Breast Products segment. The associated costs were $0.6 million and $0.5 million for the six months ended June 30, 2018 and 2017. The associated costs were $0.3 million and $0.2 million for the three months ended June 30, 2018 and 2017. These costs are viewed as part of the Company’s marketing programs and are recorded as a component of sales and marketing expense in the condensed consolidated statement of operations as an accounting policy election. For the miraDry segment, shipping and handling charges are typically billed to customers and recorded as revenue. The shipping and handling costs incurred are recorded as a component of cost of goods sold in the condensed consolidated statement of operations. The associated costs were $0.1 million and $0.2 million for the three and six months ended June 30, 2018, respectively. |
Acquisitions
Acquisitions | 6 Months Ended |
Jun. 30, 2018 | |
Business Combinations [Abstract] | |
Acquisitions | 4. Acquisitions a. Acquisition of miraDry On June 11, 2017, Sientra entered into the Merger Agreement with miraDry, pursuant to which Sientra commenced a tender offer to purchase all of the outstanding shares of miraDry’s common stock for (i) $0.3149 per share, plus (ii) the contractual right to receive one or more contingent payments upon the achievement of certain future sales milestones. The total merger consideration was $18.7 million in upfront cash and the contractual rights represent potential contingent payments of up to $14 million. The transaction, which closed on July 25, 2017, or the Acquisition Date, added the miraDry System, the only FDA cleared device indicated to reduce underarm sweat, odor and hair of all colors, to Sientra’s aesthetics portfolio. The Company did not record any professional fees related to the acquisition for the three and six months ended June 30, 2018. The Company recorded $0.4 million in professional fees related to the acquisition for the three and six months ended June 30, 2017. The aggregate acquisition date fair value of the consideration transferred was approximately $29.6 million, consisting of the following (in thousands): Fair Value Cash consideration at Acquisition Date (other than debt payoff) $ 6,193 Cash consideration at Acquisition Date (debt payoff) 12,467 Deferred consideration 966 Contingent consideration 9,946 Total purchase consideration $ 29,572 The Company funded the cash consideration, including the debt payoff amount with cash on hand. The cash consideration included the payoff of miraDry’s existing term loan, or the Note Purchase Agreement dated January 27, 2017 and bridge loan, or the January 2017 Bridge Loan, including interest. The deferred consideration relates to cash held back to be used for either potential litigation-related expenses or for payments to certain former investors of miraDry, as defined in the Note Purchase Agreement dated January 27, 2017, one year following the Acquisition Date. Contingent consideration of future cash payments of a maximum of $14.0 million represents the contractual right of certain former miraDry shareholders to receive one or more contingent payments upon achievement of certain future sales milestones and includes certain amounts due to investors related to the remaining balances on the January 2017 Bridge Note and accrued royalty obligations, with certain amounts held back for potential litigation-related expenses. The fair value of the contingent consideration at the acquisition date was determined using a Monte-Carlo simulation model. The inputs include the estimated amount and timing of future net sales, and a risk-adjusted discount rate. The inputs are significant inputs not observable in the market, which are referred to as Level 3 inputs and are further discussed in Note 6. The contingent consideration component is subject to the recognition of subsequent changes in fair value through general and administrative expense in the condensed consolidated statement of operations. In accordance with ASC 805, the Company has recorded the acquired assets (including identifiable intangible assets) and liabilities assumed at their respective fair value. The allocation of the total purchase price is as follows (in thousands): July 25, 2017 Cash $ 205 Accounts receivable, net 2,091 Inventories, net 7,064 Other current assets 170 Property and equipment, net 528 Goodwill 7,629 Intangible assets 14,800 Restricted cash 305 Other assets 12 Liabilities assumed: Accounts payable (908 ) Accrued and other current liabilities (2,294 ) Other current liabilities (30 ) Net assets acquired $ 29,572 Goodwill has been allocated to the miraDry reportable segment. The goodwill recognized is attributable primarily to the assembled workforce and additional market opportunities. Goodwill is not expected to be deductible for tax purposes. A summary of the intangible assets acquired, estimated useful lives and amortization methods is as follows (in thousands): Estimated useful Amortization Amount life method Developed technology $ 3,000 15 years Accelerated Customer relationships 6,300 14 years Accelerated Distributor relationships 500 9 years Accelerated Trade name 5,000 15 years Accelerated $ 14,800 The Company retained an independent third-party appraiser to assist management in its valuation and the purchase price has been finalized. Unaudited Pro Forma Information The following unaudited pro forma financial information presents combined results of operations for each of the periods presented, as if miraDry had been acquired as of the beginning of fiscal year 2017. The pro forma information includes adjustments to amortization for intangible assets acquired, the purchase accounting effect on inventory acquired, interest expense for the additional indebtedness incurred to complete the acquisition, restructuring charges in connection with the acquisition and acquisition costs. The pro forma data are for informational purposes only and are not necessarily indicative of the condensed consolidated results of operations of the combined business had the merger actually occurred at the beginning of fiscal year 2017 or of the results of future operations of the combined business. Consequently, actual results will differ from the unaudited pro forma information presented below (in thousands, except per share amounts): Three Months Ended Six Months Ended June 30, June 30, 2017 2017 Pro Forma Pro Forma Net sales $ 13,709 $ 25,012 Net loss (23,935 ) (44,566 ) Pro forma loss per share attributable to ordinary shares - basic and diluted $ (1.25 ) $ (2.35 ) |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 6 Months Ended |
Jun. 30, 2018 | |
Financial Instruments Owned At Fair Value [Abstract] | |
Fair Value of Financial Instruments | 5 . Fair Value of Financial Instruments The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable, accrued liabilities, customer deposits and sales return liability are reasonable estimates of their fair value because of the short maturity of these items. The fair value of the common stock warrant liability and contingent consideration are discussed in Note 6. The fair value of the debt is based on the amount of future cash flows associated with the instrument discounted using the Company’s estimated market rate. As of June 30, 2018, the carrying value of the long-term debt was not materially different from the fair value. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 6. Fair Value Measurements Certain assets and liabilities are carried at fair value under GAAP. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. Financial assets and liabilities carried at fair value are to be classified and disclosed in one of the following three levels of the fair value hierarchy, of which the first two are considered observable and the last is considered unobservable: • Level 1 — Quoted prices in active markets for identical assets or liabilities. • Level 2 — Observable inputs (other than Level 1 quoted prices) such as quoted prices in active markets for similar assets or liabilities, quoted prices in markets that are not active for identical or similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market data. • Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to determining the fair value of the assets or liabilities, including pricing models, discounted cash flow methodologies and similar techniques. The Company’s common stock warrant liabilities are carried at fair value determined according to the fair value hierarchy described above. The Company has utilized an option pricing valuation model to determine the fair value of its outstanding common stock warrant liabilities. The inputs to the model include fair value of the common stock related to the warrant, exercise price of the warrant, expected term, expected volatility, risk-free interest rate and dividend yield. The warrants are valued using the fair value of common stock as of the measurement date. The Company historically has been a private company and lacks company-specific historical and implied volatility information of its stock. Therefore, it estimates its expected stock volatility based on the historical volatility of publicly traded peer companies for a term equal to the remaining contractual term of the warrants. The risk-free interest rate is determined by reference to the U.S. Treasury yield curve for time periods approximately equal to the remaining contractual term of the warrants. The Company has estimated a 0% dividend yield based on the expected dividend yield and the fact that the Company has never paid or declared dividends. As several significant inputs are not observable, the overall fair value measurement of the warrants is classified as Level 3. The Company assessed the fair value of the contingent consideration for future royalty payments related to the acquisition of BIOCORNEUM, the contingent consideration for future milestone payments for the acquisition of the tissue expander portfolio and the contingent consideration for the future milestone payments related to the acquisition of miraDry using a Monte-Carlo simulation model. Significant assumptions used in the measurement include future net sales for a defined term and the risk-adjusted discount rate associated with the business. As the inputs are not observable, the overall fair value measurement of the contingent consideration is classified as Level 3. The following tables present information about the Company’s liabilities that are measured at fair value on a recurring basis as of June 30, 2018 and December 31, 2017 and indicate the level of the fair value hierarchy utilized to determine such fair value (in thousands): Fair Value Measurements as of June 30, 2018 Using: Level 1 Level 2 Level 3 Total Liabilities: Liability for common stock warrants $ — — 358 358 Liability for contingent consideration — — 14,027 14,027 $ — — 14,385 14,385 Fair Value Measurements as of December 31, 2017 Using: Level 1 Level 2 Level 3 Total Liabilities: Liability for common stock warrants $ — — 194 194 Liability for contingent consideration — — 12,319 12,319 $ — — 12,513 12,513 The liability for common stock warrants and the current portion of contingent consideration is included in “accrued and other current liabilities” and the long-term liabilities for the contingent consideration are included in “deferred and contingent consideration” in the condensed consolidated balance sheet. The following table provides a rollforward of the aggregate fair values of the Company’s common stock warrants and contingent consideration for which fair value is determined by Level 3 inputs (in thousands): Warrant Liability Balance, December 31, 2017 $ 194 Change in fair value of warrant liability 164 Balance, June 30, 2018 $ 358 Contingent Consideration Liability Balance, December 31, 2017 $ 12,319 Change in fair value of contingent consideration 1,708 Balance, June 30, 2018 $ 14,027 The Company recognizes changes in the fair value of the warrants in “other income (expense), net” in the condensed consolidated statement of operations and changes in contingent consideration are recognized in “general and administrative” expense in the condensed consolidated statement of operations. |
Product Warranties
Product Warranties | 6 Months Ended |
Jun. 30, 2018 | |
Product Warranties Disclosures [Abstract] | |
Product Warranties | 7. Product Warranties The Company offers a product replacement and limited warranty program for the Company’s silicone gel breast implants, and a product warranty for the Company’s miraDry Systems and consumable bioTips. For implant surgeries taking place after May 1, 2018, the breast implant product replacement and limited warranty program provides lifetime no-charge replacement implants for covered rupture events, and no-charge replacement breast implants for other covered events that occur within twenty years of the implant surgery. For certain covered events, the Company will also reimburse patients for certain out-of-pocket expenses incurred by patients within twenty years of the implant surgery, up to a maximum amount of $5,000. For implants occurring prior to May 1, 2018, the Company will reimburse patients for certain out-of-pocket costs related to revision surgeries performed within ten years from the date of implantation in a covered event. Under the breast implant lifetime product replacement program, the Company provides no-charge replacement breast implants if a patient experiences a covered event. Under the miraDry warranty, the Company provides a standard product warranty for the miraDry system and bioTips. Additionally, an extended warranty may be purchased to provide additional protection of the miraDry System. The following table provides a rollforward of the accrued warranties (in thousands): Six Months Ended June 30, 2018 2017 Beginning balance as of January 1 $ 1,642 $ 1,378 Warranty costs incurred during the period (231 ) — Changes in accrual related to warranties issued during the period 568 110 Changes in accrual related to pre-existing warranties 4 9 Balance as of June 30 $ 1,983 $ 1,497 |
Net Loss Per Share
Net Loss Per Share | 6 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | 8. Net Loss Per Share Basic net loss per share attributable to common stockholders is computed by dividing net loss by the weighted average number of common shares outstanding during each period. Diluted net loss per common share is computed by dividing net loss available to common stockholders by the weighted average number of common shares and dilutive potential common share equivalents then outstanding, to the extent they are dilutive. Potential common shares consist of shares issuable upon the exercise of stock options and warrants (using the treasury stock method). Dilutive net loss per share is the same as basic net loss per share for all periods presented because the effects of potentially dilutive items were anti-dilutive. Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 Net loss (in thousands) $ (18,028 ) $ (20,391 ) $ (37,451 ) $ (31,812 ) Weighted average common shares outstanding, basic and diluted 24,761,117 19,132,052 22,202,565 18,953,500 Net loss per share attributable to common stockholders $ (0.73 ) $ (1.07 ) $ (1.69 ) $ (1.68 ) The Company excluded the following potentially dilutive securities, outstanding as of June 30, 2018 and 2017, from the computation of diluted net loss per share attributable to common stockholders for the three and six months ended June 30, 2018 and 2017 because they had an anti-dilutive impact due to the net loss attributable to common stockholders incurred for the periods. June 30, 2018 2017 Stock options to purchase common stock 2,011,503 1,663,890 Warrants for the purchase of common stock 47,710 47,710 2,059,213 1,711,600 |
Balance Sheet Components
Balance Sheet Components | 6 Months Ended |
Jun. 30, 2018 | |
Balance Sheet Related Disclosures [Abstract] | |
Balance Sheet Components | 9. Balance Sheet Components a. Allowance for Doubtful Accounts The Company has established an allowance for doubtful accounts of $1.4 million and $0.9 million as of June 30, 2018 and December 31, 2017, respectively, recorded net against accounts receivable in the balance sheet. b. Inventories Inventories, net consist of the following (in thousands): June 30, December 31, 2018 2017 Raw materials $ 1,807 $ 1,642 Work in progress 2,015 3,956 Finished goods 17,456 15,298 Finished goods - right of return 1,209 — $ 22,487 $ 20,896 c. Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consist of the following (in thousands): June 30, December 31, 2018 2017 Prepaid expenses $ 2,245 $ 1,040 Assets held for sale 2,674 — Other current assets 1,597 472 Total $ 6,516 $ 1,512 Under the terms of the manufacturing agreement with Vesta, upon the commencement of Contract Year One (as defined in the agreement) which occurred following FDA-approval of all submissions related to the site-change PMA supplement for the Vesta manufacturing facility Vesta is obligated to purchase the manufacturing equipment and tooling that Sientra had originally purchased for the manufacture of Sientra’s breast implant inventory at Vesta’s manufacturing facility. The Company expects Vesta to purchase the equipment in the third quarter of 2018. The net book value of $2.7 million is in “assets held for sale” in “prepaid expenses and other current assets” at June 30, 2018 and “property and equipment, net” at December 31, 2017 for the Breast Products segment. d. Property and Equipment Property and equipment, net consist of the following (in thousands): June 30, December 31, 2018 2017 Leasehold improvements $ 402 $ 402 Manufacturing equipment and toolings 1,586 4,260 Computer equipment 411 387 Software 901 797 Office equipment 156 142 Furniture and fixtures 816 816 4,272 6,804 Less accumulated depreciation (2,025 ) (2,041 ) $ 2,247 $ 4,763 Depreciation expense for the three months ended June 30, 2018 and 2017 was $0.3 million and $0.2 million, respectively. Depreciation expense for the six months ended June 30, 2018 and 2017 was $0.6 million and $0.3 million, respectively. e. Goodwill and Other Intangible Assets, net Goodwill represents the excess of the purchase price over the fair value of net assets of purchased businesses. Goodwill is not amortized, but instead subject to impairment tests on at least an annual basis and whenever circumstances suggest that goodwill may be impaired. The Company’s annual test for impairment is performed as of October 1 of each fiscal year. The Company makes a qualitative assessment of whether it is more likely than not that a reporting unit’s fair value is less than its carrying amount. If the Company concludes that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, it is not required to perform the impairment assessment for that reporting unit. The applicable accounting guidance requires the Company to compare the fair value of a reporting unit with its carrying amount, including goodwill. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is not considered impaired. The impairment loss is measured by the excess of the carrying amount of the reporting unit goodwill over the fair value of that goodwill. The changes in the carrying amount of goodwill during the six months ended June 30, 2018 were as follows (in thousands): Breast Products miraDry Total Balances as of December 31, 2017 Goodwill $ 19,156 $ 7,629 $ 26,785 Accumulated impairment losses (14,278 ) — (14,278 ) Goodwill, net $ 4,878 $ 7,629 $ 12,507 Balances as of June 30, 2018 Goodwill $ 19,156 $ 7,629 $ 26,785 Accumulated impairment losses (14,278 ) — (14,278 ) Goodwill, net $ 4,878 $ 7,629 $ 12,507 The components of the Company’s other intangible assets consist of the following (in thousands): Average Amortization June 30, 2018 Period Gross Carrying Accumulated Intangible (in years) Amount Amortization Assets, net Intangibles with definite lives Customer relationships 11 $ 11,240 $ (2,672 ) $ 8,568 Trade names - finite life 14 5,800 (378 ) 5,422 Developed technology 15 3,000 (217 ) 2,783 Distributor relationships 9 500 (85 ) 415 Non-compete agreement 2 80 (72 ) 8 Regulatory approvals 1 670 (670 ) — Acquired FDA non-gel product approval 11 1,713 (1,713 ) — Total definite-lived intangible assets $ 23,003 $ (5,807 ) $ 17,196 Intangibles with indefinite lives Trade names - indefinite life — 450 — 450 Total indefinite-lived intangible assets $ 450 $ — $ 450 Average Amortization December 31, 2017 Period Gross Carrying Accumulated Intangible (in years) Amount Amortization Assets, net Intangibles with definite lives Customer relationships 11 $ 11,240 $ (1,859 ) $ 9,381 Trade names - finite life 14 5,800 (216 ) 5,584 Developed technology 15 3,000 (95 ) 2,905 Distributor relationships 9 500 (40 ) 460 Non-compete agreement 2 80 (57 ) 23 Regulatory approvals 1 670 (670 ) — Acquired FDA non-gel product approval 11 1,713 (1,713 ) — Total definite-lived intangible assets $ 23,003 $ (4,650 ) $ 18,353 Intangibles with indefinite lives Trade names - indefinite life — 450 — 450 Total indefinite-lived intangible assets $ 450 $ — $ 450 Amortization expense for the three months ended June 30, 2018 and 2017 was $0.6 million and $0.4 million, respectively. Amortization Period Expense Remainder of 2018 $ 1,151 2019 2,321 2020 2,209 2021 1,996 2022 1,762 Thereafter 7,757 $ 17,196 f. Accrued and Other Current Liabilities Accrued and other current liabilities consist of the following (in thousands): June 30, December 31, 2018 2017 Payroll and related expenses $ 4,156 $ 3,579 Accrued commissions 3,179 3,297 Accrued equipment 35 1,091 Deferred and contingent consideration, current portion 9,230 977 Audit, consulting and legal fees 406 920 Accrued sales and marketing expenses 569 794 Other 4,762 2,816 $ 22,337 $ 13,474 |
Long-Term Debt and Revolving Lo
Long-Term Debt and Revolving Loan | 6 Months Ended |
Jun. 30, 2018 | |
Debt Disclosure [Abstract] | |
Long-Term Debt and Revolving Loan | 10. Long-Term Debt and Revolving Loan On July 25, 2017, the Company entered into a Credit and Security Agreement, or the Term Loan Credit Agreement, and a Credit and Security Agreement, or the Revolving Credit Agreement with MidCap, and, together with the Term Loan Credit Agreement, the Credit Agreements, which replaced the Company’s then-existing Silicon Valley Bank Loan Agreement, or the SVB Loan Agreement. Under the terms of the Term Loan Credit Agreement, as of July 25, 2017, MidCap funded $ parties agreed to adjust the date by which the Company must obtain FDA approval of its PMA supplement in order to access the March 2018 Term Loan until April 30, 2018. In April 2018, upon FDA approval of the Company’s PMA supplement, MidCap funded the $10.0 million March Term Loan. Any indebtedness under the Term Loan Credit Agreement bears interest at a floating per annum rate equal to the LIBOR as reported by MidCap with a floor of 1.00%, which as of June 30, 2018 was 1.98%, plus 7.50%. The Term Loans have a scheduled maturity date of December 1, 2021, or the Maturity Date. The Company must make monthly payments of accrued interest under the Term Loans from the funding date of the Term Loans, until December 31, 2018, followed by monthly installments of principal and interest through the Maturity Date. The Company may prepay all of the Term Loans prior to its maturity date provided the Company pays MidCap a prepayment fee. The Company paid an origination fee of 0.50% of the Term Loans total amount of $40.0 million on the closing date. As of June 30, 2018, there was $35.0 million outstanding related to the Term Loans. As of June 30, 2018, the unamortized debt issuance costs on the Term Loans was approximately $0.1 million current portion and approximately $0.2 million long-term portion and are included as a reduction to debt on the condensed consolidated balance sheet. Any indebtedness under the Revolving Credit Agreement bears interest at a floating per annum rate equal to the LIBOR as reported by MidCap with a floor of 1.00%, plus 4.50%. The Company may make and repay borrowings from time to time under the Revolving Credit Agreement until the maturity of the facility on December 1, 2021. The Company is required to pay an annual collateral management fee of 0.50% on the outstanding balance, and an annual unused line fee of 0.50% of the average unused portion. The Company paid an origination fee of 0.50% of the Revolving Loan amount of $10.0 million on the closing date. The Company classifies the amounts borrowed under the Revolving Loan as short term because it is the Company's intention to use the line of credit to borrow and pay back funds over short periods of time. As of June 30, 2018, there were no borrowings outstanding under the Revolving Loan. As of June 30, 2018, the unamortized debt issuance costs related to the Revolving Loan was approximately $0.1 million and was included in other long-term assets on the condensed consolidated balance sheet. The amortization of debt issuance costs for the three months ended June 30, 2018 and 2017 was $34,000 and $48,000, respectively. The amortization of debt issuance costs for both the six months ended June 30, 2018 and 2017 was $0.1 million, and was included in interest expense in the condensed consolidated statements of operations. The Credit Agreements includes customary affirmative and restrictive covenants and representations and warranties, including a financial covenant for minimum revenues, a financial covenant for minimum cash requirements, a covenant against the occurrence of a “change in control,” financial reporting obligations, and certain limitations on indebtedness, liens, investments, distributions, collateral, mergers or acquisitions, taxes, and deposit accounts. Upon the occurrence of an event of default, a default interest rate of an additional 5.0% may be applied to any outstanding principal balances, and MidCap may declare all outstanding obligations immediately due and payable and take such other actions as set forth in the Credit Agreements. The Company’s obligations under the Credit Agreements are secured by a security interest in substantially all of The Company’s assets. Future Principal Payments of Debt The future schedule of principal payments for the outstanding Term Loans as of June 30, 2018 was as follows (in thousands): Fiscal Year 2019 $ 11,666 2020 11,667 2021 11,667 2022 — 2023 — Thereafter — Total $ 35,000 |
Stockholders' Equity
Stockholders' Equity | 6 Months Ended |
Jun. 30, 2018 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stockholders' Equity | 11. Stockholders’ Equity a. Authorized Stock The Company’s Amended and Restated Certificate of Incorporation authorizes the Company to issue 210,000,000 shares of common and preferred stock, consisting of 200,000,000 shares of common stock with $0.01 par value and 10,000,000 shares of preferred stock with $0.01 par value. As of June 30, 2018 and December 31, 2017, the Company had no preferred stock issued or outstanding. b. Common Stock Warrants On January 17, 2013, the Company entered into a Loan and Security Agreement, or the Original Term Loan Agreement, with Oxford Finance, LLC, or Oxford. On June 30, 2014, the Company entered into an Amended and Restated Loan and Security Agreement, or the Amended Term Loan Agreement, with Oxford. In connection with the Original Term Loan Agreement and the Amended Term Loan Agreement, the Company issued to Oxford (i) seven-year warrants in January 2013 to purchase shares of the Company’s common stock with a value equal to 3.0% of the tranche A, B and C term loans amounts and (ii) seven-year warrants in June 2014 to purchase shares of the Company’s common stock with a value equal to 2.5% of the tranche D term loan amount. The warrants have an exercise price per share of $14.671. As of June 30, 2018, there were warrants to purchase an aggregate of 47,710 shares of common stock outstanding. c. Stock Option Plans In April 2007, the Company adopted the 2007 Equity Incentive Plan, or the 2007 Plan. The 2007 Plan provides for the granting of stock options to employees, directors and consultants of the Company. Options granted under the 2007 Plan may either be incentive stock options or nonstatutory stock options. Incentive stock options, or ISOs, may be granted only to Company employees. Nonstatutory stock options, or NSOs, may be granted to all eligible recipients. A total of 1,690,448 shares of the Company’s common stock were initially reserved for issuance under the 2007 Plan. The Company’s board of directors adopted the 2014 Equity Incentive Plan, or 2014 Plan, in July 2014, and the stockholders approved the 2014 Plan in October 2014. The 2014 Plan became effective upon completion of the IPO on November 3, 2014, at which time the Company ceased granting awards under the 2007 Plan. Under the 2014 Plan, the Company may issue ISOs, NSOs, stock appreciation rights, restricted stock awards, restricted stock unit awards and other forms of stock awards, or collectively, stock awards, all of which may be granted to employees, including officers, non-employee directors and consultants of the Company and their affiliates. ISOs may be granted only to employees. A total of 1,027,500 shares of common stock were initially reserved for issuance under the 2014 Plan, subject to certain annual increases. As of June 30, 2018, a total of 244,977 shares of the Company’s common stock were available for issuance under the 2014 Plan. Pursuant to a board-approved Inducement Plan, the Company may issue NSOs and restricted stock unit awards, or collectively, stock awards, all of which may only be granted to new employees of the Company and their affiliates in accordance with NASDAQ Stock Market Rule 5635(c)(4) as an inducement material to such individuals entering into employment with the Company. As of June 30, 2018, inducement grants for 624,735 shares of common stock have been awarded, and 327,912 shares of common stock were available for future issuance under the Inducement Plan. Options under the 2007 Plan and the 2014 Plan may be granted for periods of up to ten years as determined by the Company’s board of directors, provided, however, that (i) the exercise price of an ISO shall not be less than 100% of the estimated fair value of the shares on the date of grant, and (ii) the exercise price of an ISO granted to a more than 10% shareholder shall not be less than 110% of the estimated fair value of the shares on the date of grant. An NSO has no such exercise price limitations. NSOs under the Inducement Plan may be granted for periods of up to ten years as determined by the board of directors, provided, the exercise price will not be less than 100% of the estimated fair value of the shares on the date of grant. Options generally vest with 25% of the grant vesting on the first anniversary and the balance vesting monthly on a straight-lined basis over the requisite service period of three additional years for the award. Additionally, options have been granted to certain key executives that vest upon achievement of performance conditions based on performance targets as defined by the board of directors, which have included net sales targets and defined corporate objectives over the performance period with possible payout ranging from 0% to 100% of the target award. Compensation expense is recognized on a straight-lined basis over the vesting term of one year based upon the probable performance target that will be met. The vesting provisions of individual options may vary but provide for vesting of at least 25% per year. The following summarizes all option activity under the 2007 Plan, 2014 Plan and Inducement Plan: Weighted Weighted average average remaining Option exercise contractual Shares price term (year) Balances at December 31, 2017 2,179,787 $ 7.60 7.27 Exercised (61,203 ) 6.70 Forfeited (69,896 ) 9.99 Balances at June 30, 2018 2,048,688 $ 7.54 6.72 For stock-based awards the Company recognizes compensation expense based on the grant date fair value using the Black-Scholes option valuation model. Stock-based compensation expense related to stock options was $0.4 million and $0.5 million for the three months ended June 30, 2018 and 2017, respectively. Stock-based compensation expense related to stock options was $0.8 million and $1.2 million for the six months ended June 30, 2018 and 2017, respectively. As of June 30, 2018, there was $1.8 million of unrecognized compensation costs related to stock options. The expense is recorded within the operating expense components in the condensed consolidated statement of operations based on the recipients receiving the awards. These costs are expected to be recognized over a weighted average period of 1.59 years. d. Restricted Stock Units The Company has issued restricted stock unit awards, or RSUs, under the 2014 Plan and the Inducement Plan. The RSUs issued to employees generally vest on a straight-line basis, either quarterly over a 4-year requisite service period or annually over a 3-year requisite service period. RSUs issued to non-employees generally vest either monthly or annually over the service term. Activity related to RSUs is set forth below: Weighted average Number grant date of shares fair value Balances at December 31, 2017 928,552 $ 9.12 Granted 1,327,746 11.89 Vested (366,116 ) 8.86 Forfeited (106,330 ) 10.90 Balances at June 30, 2018 1,783,852 $ 11.13 Stock-based compensation expense for RSUs for the three months ended June 30, 2018 and 2017 was $2.6 million and $1.2 million, respectively. Stock-based compensation expense for RSUs for the six months ended June 30, 2018 and 2017 was $4.6 million and $1.8 million respectively. As of June 30, 2018, there was $16.4 million of total unrecognized compensation costs related to non-vested RSU awards. The cost is expected to be recognized over a weighted average period of 2.20 years. e. Employee Stock Purchase Plan The Company’s board of directors adopted the 2014 Employee Stock Purchase Plan, or ESPP, in July 2014, and the stockholders approved the ESPP in October 2014. The ESPP allows eligible employees to purchase shares of the Company’s common stock at a discount through payroll deductions of up to 15% of their eligible compensation, subject to any plan limitations. The ESPP provides for offering periods not to exceed 27 months, and each offering period will include purchase periods, which will be the approximately six-month period commencing with one exercise date and ending with the next exercise date. Employees are able to purchase shares at 85% of the lower of the fair market value of the Company’s common stock on the first trading day of the offering period or on the purchase date. A total of 255,500 shares of common stock were initially reserved for issuance under the ESPP, subject to certain annual increases. During the six months ended June 30, 2018, employees purchased 62,491 shares of common stock at a weighted average price of $6.26 per share. As of June 30, 2018, the number of shares of common stock available for future issuance was 627,080. The Company estimated the fair value of employee stock purchase rights using the Black-Scholes model. Stock-based compensation expense related to the ESPP was $0.1 million for both the three months ended June 30, 2018 and 2017. Stock-based compensation expense related to the ESPP was $0.3 million and $0.2 million for the six months ended June 30, 2018 and 2017, respectively. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 12. Income Taxes The Company the Company |
Segment Information
Segment Information | 6 Months Ended |
Jun. 30, 2018 | |
Segment Reporting [Abstract] | |
Segment Information | 13. Segment Information Reportable Segments The Company has two reportable segments: Breast Products and miraDry. The Breast Products segment focuses on sales of silicone gel breast implants, tissue expanders and scar management products under the brands Sientra, AlloX2, Dermaspan, Softspan and BIOCORNEUM. The miraDry segment focuses on sales of the miraDry System, consisting of a console and a handheld device which uses consumable single-use bioTips. These segments align with the Company’s principal target markets. On July 25, 2017, the Company acquired miraDry. See Note 4 – Acquisitions for additional details. miraDry has been included in the condensed consolidated results of operations as of the Acquisition Date and financial performance of the acquired business is reported in the miraDry segment. The segments represent components for which separate financial information is available that is utilized on a regular basis by the Chief Executive Officer, who has been identified as the Chief Operating Decision Maker, or CODM, as defined by authoritative guidance on segment reporting, in determining how to allocate resources and evaluate performance. The segments are determined based on several factors, including client base, homogeneity of products, technology, delivery channels and similar economic characteristics. The Company’s CODM assesses the performance of each segment and allocates resources to those segments based on net sales and operating income (loss). Operating income (loss) by segment includes items that are directly attributable to each segment, including sales and marketing functions, as well as finance, information technology, human resources, legal and related corporate infrastructure costs, along with certain benefit-related expenses. There are no unallocated expenses for the two segments. The following tables present the net sales, net operating loss and net assets by reportable segment for the periods presented (in thousands): Three Months Ended Six Months Ended June 30, June 30, 2018 2017 2018 2017 Net sales Breast Products $ 9,412 $ 8,169 $ 17,954 $ 15,658 miraDry 8,142 — 14,275 — Total net sales $ 17,554 $ 8,169 $ 32,229 $ 15,658 Three Months Ended Six Months Ended June 30, June 30, 2018 2017 2018 2017 Loss from operations Breast Products $ 12,444 $ 20,210 $ 25,238 $ 31,627 miraDry 4,454 — 10,588 — Total loss from operations $ 16,898 $ 20,210 $ 35,826 $ 31,627 June 30, December 31, 2018 2017 Assets Breast Products $ 157,404 $ 59,365 miraDry 33,656 32,848 Total assets $ 191,060 $ 92,213 |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2018 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 14. Commitments and Contingencies a. Operating Leases The Company’s leases for its general office facilities are in Santa Barbara, California and Santa Clara, California, with leases expiring February 2020 and May 2019, respectively. The Company also leases additional industrial space for warehouse, research and development and additional general office use. Rent expense was $0.3 million and $0.1 million for the three months ended June 30, 2018 and 2017, respectively. Rent expense was $0.6 million and $0.3 million for the six months ended June 30, 2018 and 2017, respectively. The Company recognizes rent expense on a straight-line basis over the lease term. b. Contingencies The Company is subject to claims and assessment from time to time in the ordinary course of business. The Company accrues a liability for such matters when it is probable that future expenditures will be made and such expenditures can be reasonably estimated. Class Action Shareholder Litigation On September 25, 2015, a lawsuit styled as a class action of the Company ’ ’ ’ ’ ’ As a result of these developments, the Company determined a probable loss had been incurred and recognized a net charge to earnings of approximately $1.6 million for the nine months ended September 30, 2016 within general and administrative expense which was comprised of the loss contingency of approximately $10.9 million, net of expected insurance proceeds of approximately $9.4 million. In the first quarter of 2017, the Company received $9.3 million in insurance proceeds and paid the $10.9 million loss contingency. The remaining insurance proceeds receivable is classified as “prepaid expenses and other current assets” on the accompanying condensed consolidated balance sheets. miraDry Class Action Litigation On August 3, 2017, a lawsuit styled as a verified class action on the part of the former stockholders of miraDry was filed in the Court of Chancery for the State of Delaware against the former board of directors of miraDry, or the Defendants, alleging breach of their fiduciary duties in connection with the Company’s acquisition of miraDry. On August 30, 2017, the Defendants moved to dismiss the verified class action complaint for failure to state a claim upon which relief can be granted. On November 11, 2017 the parties notified the Court that they had reached an agreement to settle the matter pending completion of confirmatory discovery regarding the fairness of the settlement and obtaining approval from the court. Under the terms of the proposed settlement, in exchange for a full and final settlement and release of all claims, the Defendants (and/or their indemnitors and/or insurers) agreed to pay a settlement consideration of $0.4 million. The miraDry Merger Agreement contained a holdback amount expected to be used for the settlement and associated costs of the miraDry Class Action litigation and is included in the Company’s “deferred and contingent consideration, current portion” component of “accrued and other current liabilities” on the condensed consolidated balance sheet. Silimed Litigation On July 27, 2017, the Company entered into a settlement agreement, or the Settlement Agreement, with Silimed to settle outstanding litigations with Silimed. Pursuant to the Settlement Agreement, in exchange for a mutual release of claims and covenants not to sue or pursue certain litigation, Sientra paid Silimed a lump sum of $9.0 million on September 7, 2017 and paid an additional $1.0 million on June 29, 2018. In addition, should the Company enter into international markets using certain breast implant specifications, the Company has agreed to make royalty payments of $12.50 on each of its net sales of such products, up to a maximum royalty of $5.0 million. (See Part II – Item 1. Legal Proceedings – Silimed Litigation.) It is possible that additional suits will be filed, or allegations made by stockholders, with respect to these same or other matters and also naming the Company and/or its officers and directors as defendants. The Company believes it has meritorious defenses and intends to defend these lawsuits vigorously. |
Summary of Significant Accoun20
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation | a. Basis of Presentation The accompanying unaudited condensed consolidated financial statements in this Quarterly Report on Form 10-Q have been prepared in accordance with accounting principles generally accepted in the United States of America, or GAAP, and the rules and regulations of the U.S. Securities and Exchange Commission, or SEC. Accordingly, they do not include certain footnotes and financial presentations normally required under accounting principles generally accepted in the United States of America for complete financial reporting. The interim financial information is unaudited, but reflects all normal adjustments and accruals which are, in the opinion of management, considered necessary to provide a fair presentation for the interim periods presented. The accompanying condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 filed with the SEC on March 13, 2018 and Form 10-K/A filed on April 30, 2018, or the Annual Report. The results for the three and six months ended June 30, 2018 are not necessarily indicative of results to be expected for the year ending December 31, 2018, any other interim periods, or any future year or period. |
Liquidity | b. Liquidity Since the Company’s inception, it has incurred significant net operating losses and the Company anticipates that losses will continue in the near term. The Company expects its operating expenses will continue to grow as they expand operations. The Company will need to generate significant net sales to achieve profitability. To date, the Company has funded operations primarily with proceeds from the sales of preferred stock, borrowings under term loans, sales of products since 2012, and the proceeds from the sale of common stock in public offerings. The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which implies the Company will continue to realize its assets and discharge its liabilities in the normal course of business. As of June 30, 2018, the Company had cash and cash equivalents of $112.6 million. Since inception, the Company has incurred recurring losses from operations and cash outflows from operating activities. The continuation of the Company as a going concern is dependent upon many factors including liquidity and the ability to raise capital The Company received FDA approval of their PMA supplement on April 17, 2018 and was then able to access a $10.0 million term loan pursuant to an amendment to the credit agreement with MidCap Financial Trust, or MidCap. In addition, in February 2018, the Company entered into an At-The-Market Equity Offering Sales Agreement with Stifel, Nicolaus & Company, Incorporated, or Stifel, as sales agent pursuant to which the Company may sell, from time to time, through Stifel, shares of our common stock having an aggregate gross offering price of up to $50 million. . Further, on after deducting underwriting discounts and commissions and other offering expenses. The Company believes that its cash and cash equivalents will be sufficient to fund its operations for at least the next 12 months. , the Company may need to raise additional capital in the future through the sale of equity securities and incremental debt financing. |
Use of Estimates | c. Use of Estimates The preparation of the condensed consolidated financial statements, in conformity with GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. |
Significant Accounting Policies | d. Significant Accounting Policies Revenue Recognition The Company recognizes revenue when the Company transfers control of promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled to in exchange for those goods or services. See Note 3 - Revenue for further discussion. There have been no other changes to the accounting policies during the three and six months ended June 30, 2018, as compared to the significant accounting policies described in the “Notes to Financial Statements” in the Annual Report. |
Recent Accounting Pronouncements | e. Recent Accounting Pronouncements Recently Adopted Accounting Standards In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers Topic 606). Revenue Recognition In accordance with Topic 606 disclosure requirements, the impact of adoption on our condensed consolidated balance sheet was as follows (in thousands): As Reported Total Adjusted December 31, 2017 Adjustment January 1, 2018 Balance Sheet Assets Accounts receivable, net of allowances $ 6,569 3,906 10,475 Liabilities Sales return liability $ — 3,906 3,906 As Reported Total Amounts Under June 30, 2018 Adjustment Previous Standards Balance Sheet Assets Accounts receivable, net of allowances $ 16,330 (4,882 ) 11,448 Liabilities Sales return liability $ 4,882 (4,882 ) — Additionally, in accordance with Topic 606, the balance of breast product inventory estimated to be returned as of June 30, 2018 is included in the components of the Company’s inventory as “finished goods – right of return” in Note 9b - Inventories. Prior to the adoption of Topic 606, the inventory impact of estimated returns for breast products was included in the “finished goods” inventory balance and was not separately disclosed. The adoption of Topic 606 did not have a material impact on our condensed consolidated statement of operations. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows – Classifications of Certain Cash Receipts and Cash Payments (Topic 230) The ASU requires a retrospective approach to adoption. The Company adopted the ASU in the first quarter of 2018. In January 2017, the FASB issued ASU 2017-01, Business Combinations (Topic 805) - Clarifying the Definition of a Business . The standard The Company adopted the ASU in the first quarter of 2018 on prospective basis. The adoption of this ASU did not have a material impact on the Company’s condensed consolidated financial statements. In May 2017, the FASB issued ASU 2017-09, Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting The standard provides clarification on when modification accounting should be used for changes to the terms or conditions of a share-based payment award Recently Issued Accounting Standards In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) Leases (Topic 840). In February 2018, the FASB issued ASU 2018-02, Income Taxes (Topic 740) In June 2018, the FASB issued ASU 2018-07, Compensation - Stock Compensation (Topic 718), |
Reclassifications | f. Reclassifications Certain reclassifications have been made to prior year amounts to conform to the current year presentation. |
Revenue Recognition | Revenue Recognition The Company generates revenue primarily through the sale and delivery of promised goods or services to customers and recognizes revenue when control is transferred to customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for the goods or services. Sales prices are documented in the executed sales contract or purchase order prior to the transfer of control to the customer. Customers may enter into a separate extended service agreement to purchase an extended warranty for miraDry products from the Company whereby the payment is due at the inception of the agreement. Revenue for extended service agreements are recognized ratably over the term of the agreements. The Company also leverages a distributor network for selling the miraDry System internationally. The Company recognizes revenue when control of the goods or services is transferred to the distributors. Standard terms in these agreements do not allow for trial periods, right of return, refunds, payment contingent on obtaining financing or other terms that could impact the customer’s payment obligation. A portion of the Company’s revenue is generated from the sale of consigned inventory of breast implants maintained at doctor, hospital, and clinic locations. For these products, revenue is recognized at the time the Company is notified by the customer that the product has been implanted, not when the consigned products are delivered to the customer’s location. For Breast Products, with the exception of the Company’s BIOCORNEUM scar management products, the Company allows for the return of products from customers within six months after the original sale, which is accounted for as variable consideration. Appropriate reserves are established for anticipated sales returns based on the expected amount calculated with historical experience, recent gross sales and any notification of pending returns. The estimated sales return is recorded as a reduction of revenue and as a refund liability in the same period revenue is recognized. Actual sales returns in any future period are inherently uncertain and thus may differ from the estimates. If actual sales returns differ significantly from the estimates, an adjustment to revenue in the current or subsequent period would be recorded. The Company has established an allowance for sales returns of $4.9 million and $3.9 million as of June 30, 2018 and December 31, 2017, respectively, recorded as “sales return liability” on the condensed consolidated balance sheet under Topic 606 as of June 30, 2018 and recorded in “accounts receivable, net of allowances,” at December 31, 2017 on the condensed consolidated balance sheet, as indicated above in “ Sales tax, value-added tax, and other taxes the Company may collect concurrent with revenue-producing activities are excluded from the measurement of the transaction price and thus from revenue. |
Summary of Significant Accoun21
Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
ASU 2014-09 | |
New Accounting Pronouncements Or Change In Accounting Principle [Line Items] | |
Schedule of Impact of Topic 606 Adoption on Condensed Consolidated Balance Sheet | In accordance with Topic 606 disclosure requirements, the impact of adoption on our condensed consolidated balance sheet was as follows (in thousands): As Reported Total Adjusted December 31, 2017 Adjustment January 1, 2018 Balance Sheet Assets Accounts receivable, net of allowances $ 6,569 3,906 10,475 Liabilities Sales return liability $ — 3,906 3,906 As Reported Total Amounts Under June 30, 2018 Adjustment Previous Standards Balance Sheet Assets Accounts receivable, net of allowances $ 16,330 (4,882 ) 11,448 Liabilities Sales return liability $ 4,882 (4,882 ) — |
Acquisitions (Tables)
Acquisitions (Tables) - miraDry | 6 Months Ended |
Jun. 30, 2018 | |
Business Acquisition [Line Items] | |
Schedule of aggregate acquisition date fair value of consideration transferred | The aggregate acquisition date fair value of the consideration transferred was approximately $29.6 million, consisting of the following (in thousands): Fair Value Cash consideration at Acquisition Date (other than debt payoff) $ 6,193 Cash consideration at Acquisition Date (debt payoff) 12,467 Deferred consideration 966 Contingent consideration 9,946 Total purchase consideration $ 29,572 |
Schedule of allocation of the fair value of the consideration transferred by major class | In accordance with ASC 805, the Company has recorded the acquired assets (including identifiable intangible assets) and liabilities assumed at their respective fair value. The allocation of the total purchase price is as follows (in thousands): July 25, 2017 Cash $ 205 Accounts receivable, net 2,091 Inventories, net 7,064 Other current assets 170 Property and equipment, net 528 Goodwill 7,629 Intangible assets 14,800 Restricted cash 305 Other assets 12 Liabilities assumed: Accounts payable (908 ) Accrued and other current liabilities (2,294 ) Other current liabilities (30 ) Net assets acquired $ 29,572 |
Schedule of intangible assets acquired | A summary of the intangible assets acquired, estimated useful lives and amortization methods is as follows (in thousands): Estimated useful Amortization Amount life method Developed technology $ 3,000 15 years Accelerated Customer relationships 6,300 14 years Accelerated Distributor relationships 500 9 years Accelerated Trade name 5,000 15 years Accelerated $ 14,800 |
Unaudited Pro Forma Information | The pro forma data are for informational purposes only and are not necessarily indicative of the condensed consolidated results of operations of the combined business had the merger actually occurred at the beginning of fiscal year 2017 or of the results of future operations of the combined business. Consequently, actual results will differ from the unaudited pro forma information presented below (in thousands, except per share amounts): Three Months Ended Six Months Ended June 30, June 30, 2017 2017 Pro Forma Pro Forma Net sales $ 13,709 $ 25,012 Net loss (23,935 ) (44,566 ) Pro forma loss per share attributable to ordinary shares - basic and diluted $ (1.25 ) $ (2.35 ) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Schedule of Company's liabilities that are measured at fair value on a recurring basis | The following tables present information about the Company’s liabilities that are measured at fair value on a recurring basis as of June 30, 2018 and December 31, 2017 and indicate the level of the fair value hierarchy utilized to determine such fair value (in thousands): Fair Value Measurements as of June 30, 2018 Using: Level 1 Level 2 Level 3 Total Liabilities: Liability for common stock warrants $ — — 358 358 Liability for contingent consideration — — 14,027 14,027 $ — — 14,385 14,385 Fair Value Measurements as of December 31, 2017 Using: Level 1 Level 2 Level 3 Total Liabilities: Liability for common stock warrants $ — — 194 194 Liability for contingent consideration — — 12,319 12,319 $ — — 12,513 12,513 |
Schedule of aggregate fair values of the Company's common stock warrants and contingent consideration for which fair value is determined by Level 3 inputs | The following table provides a rollforward of the aggregate fair values of the Company’s common stock warrants and contingent consideration for which fair value is determined by Level 3 inputs (in thousands): Warrant Liability Balance, December 31, 2017 $ 194 Change in fair value of warrant liability 164 Balance, June 30, 2018 $ 358 Contingent Consideration Liability Balance, December 31, 2017 $ 12,319 Change in fair value of contingent consideration 1,708 Balance, June 30, 2018 $ 14,027 |
Product Warranties (Tables)
Product Warranties (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Product Warranties Disclosures [Abstract] | |
Schedule of rollforward of the accrued warranties | The following table provides a rollforward of the accrued warranties (in thousands): Six Months Ended June 30, 2018 2017 Beginning balance as of January 1 $ 1,642 $ 1,378 Warranty costs incurred during the period (231 ) — Changes in accrual related to warranties issued during the period 568 110 Changes in accrual related to pre-existing warranties 4 9 Balance as of June 30 $ 1,983 $ 1,497 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
Schedule of net loss per share, basic and diluted | Three Months Ended June 30, Six Months Ended June 30, 2018 2017 2018 2017 Net loss (in thousands) $ (18,028 ) $ (20,391 ) $ (37,451 ) $ (31,812 ) Weighted average common shares outstanding, basic and diluted 24,761,117 19,132,052 22,202,565 18,953,500 Net loss per share attributable to common stockholders $ (0.73 ) $ (1.07 ) $ (1.69 ) $ (1.68 ) |
Schedule of potentially dilutive securities excluded from the computation of diluted net loss per share attributable to common stockholders | The Company excluded the following potentially dilutive securities, outstanding as of June 30, 2018 and 2017, from the computation of diluted net loss per share attributable to common stockholders for the three and six months ended June 30, 2018 and 2017 because they had an anti-dilutive impact due to the net loss attributable to common stockholders incurred for the periods. June 30, 2018 2017 Stock options to purchase common stock 2,011,503 1,663,890 Warrants for the purchase of common stock 47,710 47,710 2,059,213 1,711,600 |
Balance Sheet Components (Table
Balance Sheet Components (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Balance Sheet Related Disclosures [Abstract] | |
Schedule of inventories, net | Inventories, net consist of the following (in thousands): June 30, December 31, 2018 2017 Raw materials $ 1,807 $ 1,642 Work in progress 2,015 3,956 Finished goods 17,456 15,298 Finished goods - right of return 1,209 — $ 22,487 $ 20,896 |
Schedule of prepaid expenses and other current assets | c. Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consist of the following (in thousands): June 30, December 31, 2018 2017 Prepaid expenses $ 2,245 $ 1,040 Assets held for sale 2,674 — Other current assets 1,597 472 Total $ 6,516 $ 1,512 |
Schedule of property and equipment, net | Property and equipment, net consist of the following (in thousands): June 30, December 31, 2018 2017 Leasehold improvements $ 402 $ 402 Manufacturing equipment and toolings 1,586 4,260 Computer equipment 411 387 Software 901 797 Office equipment 156 142 Furniture and fixtures 816 816 4,272 6,804 Less accumulated depreciation (2,025 ) (2,041 ) $ 2,247 $ 4,763 |
Schedule of changes in carrying amount of goodwill | The changes in the carrying amount of goodwill during the six months ended June 30, 2018 were as follows (in thousands): Breast Products miraDry Total Balances as of December 31, 2017 Goodwill $ 19,156 $ 7,629 $ 26,785 Accumulated impairment losses (14,278 ) — (14,278 ) Goodwill, net $ 4,878 $ 7,629 $ 12,507 Balances as of June 30, 2018 Goodwill $ 19,156 $ 7,629 $ 26,785 Accumulated impairment losses (14,278 ) — (14,278 ) Goodwill, net $ 4,878 $ 7,629 $ 12,507 |
Schedule of intangible assets | The components of the Company’s other intangible assets consist of the following (in thousands): Average Amortization June 30, 2018 Period Gross Carrying Accumulated Intangible (in years) Amount Amortization Assets, net Intangibles with definite lives Customer relationships 11 $ 11,240 $ (2,672 ) $ 8,568 Trade names - finite life 14 5,800 (378 ) 5,422 Developed technology 15 3,000 (217 ) 2,783 Distributor relationships 9 500 (85 ) 415 Non-compete agreement 2 80 (72 ) 8 Regulatory approvals 1 670 (670 ) — Acquired FDA non-gel product approval 11 1,713 (1,713 ) — Total definite-lived intangible assets $ 23,003 $ (5,807 ) $ 17,196 Intangibles with indefinite lives Trade names - indefinite life — 450 — 450 Total indefinite-lived intangible assets $ 450 $ — $ 450 Average Amortization December 31, 2017 Period Gross Carrying Accumulated Intangible (in years) Amount Amortization Assets, net Intangibles with definite lives Customer relationships 11 $ 11,240 $ (1,859 ) $ 9,381 Trade names - finite life 14 5,800 (216 ) 5,584 Developed technology 15 3,000 (95 ) 2,905 Distributor relationships 9 500 (40 ) 460 Non-compete agreement 2 80 (57 ) 23 Regulatory approvals 1 670 (670 ) — Acquired FDA non-gel product approval 11 1,713 (1,713 ) — Total definite-lived intangible assets $ 23,003 $ (4,650 ) $ 18,353 Intangibles with indefinite lives Trade names - indefinite life — 450 — 450 Total indefinite-lived intangible assets $ 450 $ — $ 450 |
Schedule of estimated amortization expense | The following table summarizes the estimated amortization expense relating to the Company's definite-lived intangible assets as of June 30, 2018 (in thousands): Amortization Period Expense Remainder of 2018 $ 1,151 2019 2,321 2020 2,209 2021 1,996 2022 1,762 Thereafter 7,757 $ 17,196 |
Schedule of accrued and other current liabilities | Accrued and other current liabilities consist of the following (in thousands): June 30, December 31, 2018 2017 Payroll and related expenses $ 4,156 $ 3,579 Accrued commissions 3,179 3,297 Accrued equipment 35 1,091 Deferred and contingent consideration, current portion 9,230 977 Audit, consulting and legal fees 406 920 Accrued sales and marketing expenses 569 794 Other 4,762 2,816 $ 22,337 $ 13,474 |
Long-Term Debt and Revolving 27
Long-Term Debt and Revolving Loan (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Future Principal Payments for Outstanding Term Loans | The future schedule of principal payments for the outstanding Term Loans as of June 30, 2018 was as follows (in thousands): Fiscal Year 2019 $ 11,666 2020 11,667 2021 11,667 2022 — 2023 — Thereafter — Total $ 35,000 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Summary of option activity | Weighted Weighted average average remaining Option exercise contractual Shares price term (year) Balances at December 31, 2017 2,179,787 $ 7.60 7.27 Exercised (61,203 ) 6.70 Forfeited (69,896 ) 9.99 Balances at June 30, 2018 2,048,688 $ 7.54 6.72 |
Summary of RSUs activity | Weighted average Number grant date of shares fair value Balances at December 31, 2017 928,552 $ 9.12 Granted 1,327,746 11.89 Vested (366,116 ) 8.86 Forfeited (106,330 ) 10.90 Balances at June 30, 2018 1,783,852 $ 11.13 |
Segment Information (Tables)
Segment Information (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Segment Reporting [Abstract] | |
Summary of Net Sales, Net Operating Loss and Net Assets by Reportable | The following tables present the net sales, net operating loss and net assets by reportable segment for the periods presented (in thousands): Three Months Ended Six Months Ended June 30, June 30, 2018 2017 2018 2017 Net sales Breast Products $ 9,412 $ 8,169 $ 17,954 $ 15,658 miraDry 8,142 — 14,275 — Total net sales $ 17,554 $ 8,169 $ 32,229 $ 15,658 Three Months Ended Six Months Ended June 30, June 30, 2018 2017 2018 2017 Loss from operations Breast Products $ 12,444 $ 20,210 $ 25,238 $ 31,627 miraDry 4,454 — 10,588 — Total loss from operations $ 16,898 $ 20,210 $ 35,826 $ 31,627 June 30, December 31, 2018 2017 Assets Breast Products $ 157,404 $ 59,365 miraDry 33,656 32,848 Total assets $ 191,060 $ 92,213 |
Formation and Business of the30
Formation and Business of the Company (Details) | May 07, 2018USD ($)$ / sharesshares | Jun. 11, 2017USD ($)Payment$ / shares | Jun. 30, 2018 |
Formation and Business of the Company [Line Items] | |||
Proceeds from the issuance of common stock, net of underwriting discounts, commissions and offering expenses | $ 107,600,000 | ||
Underwritten Follow-On Offering | Common stock | |||
Formation and Business of the Company [Line Items] | |||
Shares issued in follow-on public offering | shares | 7,407,408 | ||
Public offering price (in dollars per share) | $ / shares | $ 13.50 | ||
Additional shares granted to underwriters | shares | 1,111,111 | ||
Proceeds from the issuance of common stock, net of underwriting discounts, commissions and offering expenses | $ 107,600,000 | ||
Payment of underwriting discounts and commissions and offering expenses | 6,900,000 | ||
Offering expenses | $ 500,000 | ||
miraDry | |||
Formation and Business of the Company [Line Items] | |||
Business acquisition agreement date | Jun. 11, 2017 | ||
Business purchase price per share | $ / shares | $ 0.3149 | ||
Business combination, upfront cash payments | $ 18,700,000 | ||
Business combination, potential contingent payments | $ 9,946,000 | ||
Effective date of acquisition | Jul. 25, 2017 | ||
Minimum | miraDry | |||
Formation and Business of the Company [Line Items] | |||
Number of contingent payments | Payment | 1 | ||
Maximum | miraDry | |||
Formation and Business of the Company [Line Items] | |||
Business combination, potential contingent payments | $ 14,000,000 |
Summary of Significant Accoun31
Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands | May 07, 2018 | Feb. 28, 2018 | Jun. 30, 2018 | Apr. 30, 2018 | Dec. 31, 2017 |
Summary Of Significant Accounting Policies [Line Items] | |||||
Cash and cash equivalents | $ 112,619 | $ 26,588 | |||
Common stock, shares issued | 28,390,271 | 19,474,702 | |||
Proceeds from the issuance of common stock, net of underwriting discounts, commissions and offering expenses | $ 107,600 | ||||
At-The-Market Equity Offering Sales Agreement | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Common stock, shares issued | 0 | ||||
Maximum | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Aggregate gross offering price | $ 50,000 | ||||
March Two Thousand Eighteen Term Loan | |||||
Summary Of Significant Accounting Policies [Line Items] | |||||
Loan amount outstanding | $ 10,000 |
Summary of Significant Accoun32
Summary of Significant Accounting Policies - Schedule of Impact of Topic 606 Adoption on Condensed Consolidated Balance Sheet (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Jan. 01, 2018 | Dec. 31, 2017 |
Assets | |||
Accounts receivable, net of allowances | $ 16,330 | $ 6,569 | |
Liabilities | |||
Sales return liability | 4,882 | ||
ASU 2014-09 | |||
Assets | |||
Accounts receivable, net of allowances | $ 10,475 | ||
Liabilities | |||
Sales return liability | 3,906 | ||
Total Adjustment | ASU 2014-09 | |||
Assets | |||
Accounts receivable, net of allowances | (4,882) | 3,906 | |
Liabilities | |||
Sales return liability | (4,882) | $ 3,906 | |
Amounts Under Previous Standards | ASU 2014-09 | |||
Assets | |||
Accounts receivable, net of allowances | $ 11,448 |
Revenue (Details)
Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Revenue From Contracts With Customers [Line Items] | |||||
Period for sales return | 6 months | ||||
Allowance for sales returns | $ 4.9 | $ 3.9 | |||
Revenue, practical expedient, incremental cost of obtaining contract | true | ||||
Revenue, practical expedient, significant financing component | true | ||||
Breast Products | Sales and marketing expense | |||||
Revenue From Contracts With Customers [Line Items] | |||||
Shipping and handling costs | $ 0.3 | $ 0.2 | $ 0.6 | $ 0.5 | |
miraDry | Cost of goods sold | |||||
Revenue From Contracts With Customers [Line Items] | |||||
Shipping and handling costs | $ 0.1 | $ 0.2 |
Acquisitions (Details)
Acquisitions (Details) - miraDry | Jun. 11, 2017USD ($)Payment$ / shares | Jun. 30, 2018USD ($) | Jun. 30, 2017USD ($) | Jun. 30, 2018USD ($) | Jun. 30, 2017USD ($) |
Business Acquisition [Line Items] | |||||
Business acquisition agreement date | Jun. 11, 2017 | ||||
Business purchase price per share | $ / shares | $ 0.3149 | ||||
Cash | $ 18,700,000 | ||||
Contingent consideration | 9,946,000 | ||||
Effective date of acquisition | Jul. 25, 2017 | ||||
Professional fees | $ 0 | $ 400,000 | $ 0 | $ 400,000 | |
Fair value of consideration transferred | $ 29,572,000 | ||||
Business combination contingent consideration payment period | 1 year | ||||
Minimum | |||||
Business Acquisition [Line Items] | |||||
Number of contingent payments | Payment | 1 | ||||
Maximum | |||||
Business Acquisition [Line Items] | |||||
Contingent consideration | $ 14,000,000 | ||||
Estimated future payments due | $ 14,000,000 |
Acquisitions - Schedule of aggr
Acquisitions - Schedule of aggregate acquisition date fair value of consideration transferred (Details) - miraDry $ in Thousands | Jun. 11, 2017USD ($) |
Business Acquisition [Line Items] | |
Cash consideration at Acquisition Date (other than debt payoff) | $ 6,193 |
Cash consideration at Acquisition Date (debt payoff) | 12,467 |
Deferred consideration | 966 |
Contingent consideration | 9,946 |
Total purchase consideration | $ 29,572 |
Acquisitions - Schedule of allo
Acquisitions - Schedule of allocation of the fair value of the consideration transferred by major class (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 | Jul. 25, 2017 |
Fair value of the assets acquired | |||
Goodwill | $ 12,507 | $ 12,507 | |
miraDry | |||
Fair value of the assets acquired | |||
Cash | $ 205 | ||
Accounts receivable, net | 2,091 | ||
Inventories, net | 7,064 | ||
Other current assets | 170 | ||
Property and equipment, net | 528 | ||
Goodwill | 7,629 | ||
Intangible assets | 14,800 | ||
Restricted cash | 305 | ||
Other assets | 12 | ||
Liabilities assumed: | |||
Accounts payable | (908) | ||
Accrued and other current liabilities | (2,294) | ||
Other current liabilities | (30) | ||
Net assets acquired | $ 29,572 |
Acquisitions - Schedule of inta
Acquisitions - Schedule of intangible assets acquired (Details) - miraDry $ in Thousands | Jul. 25, 2017USD ($) |
Fair value of the assets acquired | |
Intangible assets | $ 14,800 |
Developed technology | |
Fair value of the assets acquired | |
Intangible assets | $ 3,000 |
Estimated useful life of asset | 15 years |
Amortization method | Accelerated |
Customer relationships | |
Fair value of the assets acquired | |
Intangible assets | $ 6,300 |
Estimated useful life of asset | 14 years |
Amortization method | Accelerated |
Distributor relationships | |
Fair value of the assets acquired | |
Intangible assets | $ 500 |
Estimated useful life of asset | 9 years |
Amortization method | Accelerated |
Trade name | |
Fair value of the assets acquired | |
Intangible assets | $ 5,000 |
Estimated useful life of asset | 15 years |
Amortization method | Accelerated |
Acquisitions - Unaudited Pro Fo
Acquisitions - Unaudited Pro Forma Information (Details) - miraDry - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2017 | Jun. 30, 2017 | |
Business Acquisition [Line Items] | ||
Net sales | $ 13,709 | $ 25,012 |
Net loss | $ (23,935) | $ (44,566) |
Pro forma loss per share attributable to ordinary shares - basic and diluted | $ (1.25) | $ (2.35) |
Fair Value Measurements (Detail
Fair Value Measurements (Details) | 6 Months Ended |
Jun. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Estimated dividend yield | 0.00% |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Company's liabilities that are measured at fair value on a recurring basis (Details) - Recurring - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Fair Value Measurements | ||
Fair value liability | $ 14,385 | $ 12,513 |
Warrants | ||
Fair Value Measurements | ||
Fair value liability | 358 | 194 |
Contingent Consideration Liability | ||
Fair Value Measurements | ||
Fair value liability | 14,027 | 12,319 |
Level 3 | ||
Fair Value Measurements | ||
Fair value liability | 14,385 | 12,513 |
Level 3 | Warrants | ||
Fair Value Measurements | ||
Fair value liability | 358 | 194 |
Level 3 | Contingent Consideration Liability | ||
Fair Value Measurements | ||
Fair value liability | $ 14,027 | $ 12,319 |
Fair Value Measurements - Sch41
Fair Value Measurements - Schedule of aggregate fair values of the Company's common stock warrants and contingent consideration for which fair value is determined by Level 3 inputs (Details) - Level 3 - Recurring $ in Thousands | 6 Months Ended |
Jun. 30, 2018USD ($) | |
Warrants | |
Fair values of the Company's liabilities determined by Level 3 inputs | |
Balance at beginning of the period | $ 194 |
Change in fair value | 164 |
Balance at the end of the period | 358 |
Contingent Consideration Liability | |
Fair values of the Company's liabilities determined by Level 3 inputs | |
Balance at beginning of the period | 12,319 |
Change in fair value | 1,708 |
Balance at the end of the period | $ 14,027 |
Product Warranties (Details)
Product Warranties (Details) | 6 Months Ended |
Jun. 30, 2018USD ($) | |
Maximum | |
Product Warranty Liability [Line Items] | |
Reimbursement for out of pocket expenses | $ 5,000 |
Implants occuring after May 1, 2018 | |
Product Warranty Liability [Line Items] | |
Period to claim reimbursement under limited warranty program | 20 years |
Implants occuring prior to May 1, 2018 | |
Product Warranty Liability [Line Items] | |
Period to claim reimbursement under limited warranty program | 10 years |
Product Warranties - Schedule o
Product Warranties - Schedule of rollforward of the accrued warranties (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Product Warranties Disclosures [Abstract] | ||
Beginning balance | $ 1,642 | $ 1,378 |
Warranty costs incurred during the period | (231) | |
Changes in accrual related to warranties issued during the period | 568 | 110 |
Changes in accrual related to pre-existing warranties | 4 | 9 |
Ending Balance | $ 1,983 | $ 1,497 |
Net Loss Per Share - Schedule o
Net Loss Per Share - Schedule of Net Loss Per Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Earnings Per Share [Abstract] | ||||
Net loss | $ (18,028) | $ (20,391) | $ (37,451) | $ (31,812) |
Weighted average common shares outstanding, basic and diluted | 24,761,117 | 19,132,052 | 22,202,565 | 18,953,500 |
Net loss per share attributable to common stockholders | $ (0.73) | $ (1.07) | $ (1.69) | $ (1.68) |
Net Loss Per Share - Schedule45
Net Loss Per Share - Schedule of Potentially Dilutive Securities Excluded from Computation of Diluted Net Loss Per Share Attributable to Common Stockholders (Details) - shares | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Potentially dilutive securities | ||
Potentially dilutive securities | 2,059,213 | 1,711,600 |
Stock options to purchase common stock | ||
Potentially dilutive securities | ||
Potentially dilutive securities | 2,011,503 | 1,663,890 |
Warrants for the purchase of common stock | ||
Potentially dilutive securities | ||
Potentially dilutive securities | 47,710 | 47,710 |
Balance Sheet Components (Allow
Balance Sheet Components (Allowance) (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Dec. 31, 2017 |
Balance Sheet Related Disclosures [Abstract] | ||
Allowance for doubtful accounts | $ 1.4 | $ 0.9 |
Balance Sheet Components (Inven
Balance Sheet Components (Inventories) (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Balance Sheet Related Disclosures [Abstract] | ||
Raw materials | $ 1,807 | $ 1,642 |
Work in progress | 2,015 | 3,956 |
Finished goods | 17,456 | 15,298 |
Finished goods - right of return | 1,209 | |
Inventory, net | $ 22,487 | $ 20,896 |
Balance Sheet Components (Prepa
Balance Sheet Components (Prepaid Expenses and Other Current Assets) (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Property Plant And Equipment [Line Items] | ||
Prepaid expenses | $ 2,245 | $ 1,040 |
Assets held for sale | 2,674 | |
Other current assets | 1,597 | 472 |
Total | 6,516 | $ 1,512 |
Breast Products | Prepaid Expenses and Other Current Assets | ||
Property Plant And Equipment [Line Items] | ||
Assets held for sale | $ 2,700 |
Balance Sheet Components (PPE)
Balance Sheet Components (PPE) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Property Plant And Equipment [Line Items] | |||||
Property and equipment, gross | $ 4,272 | $ 4,272 | $ 6,804 | ||
Less accumulated depreciation | (2,025) | (2,025) | (2,041) | ||
Property and equipment, net | 2,247 | 2,247 | 4,763 | ||
Depreciation expense | 300 | $ 200 | 600 | $ 300 | |
Leasehold improvements | |||||
Property Plant And Equipment [Line Items] | |||||
Property and equipment, gross | 402 | 402 | 402 | ||
Manufacturing equipment and toolings | |||||
Property Plant And Equipment [Line Items] | |||||
Property and equipment, gross | 1,586 | 1,586 | 4,260 | ||
Computer equipment | |||||
Property Plant And Equipment [Line Items] | |||||
Property and equipment, gross | 411 | 411 | 387 | ||
Software | |||||
Property Plant And Equipment [Line Items] | |||||
Property and equipment, gross | 901 | 901 | 797 | ||
Office equipment | |||||
Property Plant And Equipment [Line Items] | |||||
Property and equipment, gross | 156 | 156 | 142 | ||
Furniture and fixtures | |||||
Property Plant And Equipment [Line Items] | |||||
Property and equipment, gross | $ 816 | $ 816 | $ 816 |
Balance Sheet Components (Goodw
Balance Sheet Components (Goodwill and Intangibles) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Goodwill and intangible assets | |||||
Goodwill | $ 26,785 | $ 26,785 | $ 26,785 | ||
Accumulated impairment losses | (14,278) | (14,278) | (14,278) | ||
Goodwill, net | 12,507 | 12,507 | 12,507 | ||
Other intangible assets | |||||
Gross Carrying Amount | 23,003 | 23,003 | 23,003 | ||
Accumulated Amortization | (5,807) | (5,807) | (4,650) | ||
Intangible Assets, net | 17,196 | 17,196 | 18,353 | ||
Indefinite-lived intangible assets | 450 | 450 | 450 | ||
Amortization expense | 600 | $ 400 | 1,200 | $ 900 | |
Estimated amortization expense | |||||
Remainder of 2018 | 1,151 | 1,151 | |||
2,019 | 2,321 | 2,321 | |||
2,020 | 2,209 | 2,209 | |||
2,021 | 1,996 | 1,996 | |||
2,022 | 1,762 | 1,762 | |||
Thereafter | 7,757 | 7,757 | |||
Total amortization | 17,196 | 17,196 | |||
Trade name | |||||
Other intangible assets | |||||
Indefinite-lived intangible assets | 450 | $ 450 | $ 450 | ||
Acquired FDA non-gel product approval | |||||
Other intangible assets | |||||
Average Amortization Period | 11 years | 11 years | |||
Gross Carrying Amount | 1,713 | $ 1,713 | $ 1,713 | ||
Accumulated Amortization | (1,713) | $ (1,713) | $ (1,713) | ||
Customer relationships | |||||
Other intangible assets | |||||
Average Amortization Period | 11 years | 11 years | |||
Gross Carrying Amount | 11,240 | $ 11,240 | $ 11,240 | ||
Accumulated Amortization | (2,672) | (2,672) | (1,859) | ||
Intangible Assets, net | 8,568 | $ 8,568 | $ 9,381 | ||
Trade name | |||||
Other intangible assets | |||||
Average Amortization Period | 14 years | 14 years | |||
Gross Carrying Amount | 5,800 | $ 5,800 | $ 5,800 | ||
Accumulated Amortization | (378) | (378) | (216) | ||
Intangible Assets, net | 5,422 | $ 5,422 | $ 5,584 | ||
Developed technology | |||||
Other intangible assets | |||||
Average Amortization Period | 15 years | 15 years | |||
Gross Carrying Amount | 3,000 | $ 3,000 | $ 3,000 | ||
Accumulated Amortization | (217) | (217) | (95) | ||
Intangible Assets, net | 2,783 | $ 2,783 | $ 2,905 | ||
Distributor relationships | |||||
Other intangible assets | |||||
Average Amortization Period | 9 years | 9 years | |||
Gross Carrying Amount | 500 | $ 500 | $ 500 | ||
Accumulated Amortization | (85) | (85) | (40) | ||
Intangible Assets, net | 415 | $ 415 | $ 460 | ||
Regulatory approvals | |||||
Other intangible assets | |||||
Average Amortization Period | 1 year | 1 year | |||
Gross Carrying Amount | 670 | $ 670 | $ 670 | ||
Accumulated Amortization | (670) | $ (670) | $ (670) | ||
Non-compete agreement | |||||
Other intangible assets | |||||
Average Amortization Period | 2 years | 2 years | |||
Gross Carrying Amount | 80 | $ 80 | $ 80 | ||
Accumulated Amortization | (72) | (72) | (57) | ||
Intangible Assets, net | 8 | 8 | 23 | ||
Breast Products | |||||
Goodwill and intangible assets | |||||
Goodwill | 19,156 | 19,156 | 19,156 | ||
Accumulated impairment losses | (14,278) | (14,278) | (14,278) | ||
Goodwill, net | 4,878 | 4,878 | 4,878 | ||
miraDry | |||||
Goodwill and intangible assets | |||||
Goodwill | 7,629 | 7,629 | 7,629 | ||
Goodwill, net | $ 7,629 | $ 7,629 | $ 7,629 |
Balance Sheet Components (Accru
Balance Sheet Components (Accrued liabilities) (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Accrued and other current liabilities | ||
Payroll and related expenses | $ 4,156 | $ 3,579 |
Accrued commissions | 3,179 | 3,297 |
Accrued equipment | 35 | 1,091 |
Deferred and contingent consideration, current portion | 9,230 | 977 |
Audit, consulting and legal fees | 406 | 920 |
Accrued sales and marketing expenses | 569 | 794 |
Other | 4,762 | 2,816 |
Total | $ 22,337 | $ 13,474 |
Long-Term Debt and Revolving 52
Long-Term Debt and Revolving Loan (Details) - USD ($) | Apr. 18, 2018 | Jul. 25, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Apr. 30, 2018 |
Line Of Credit Facility [Line Items] | |||||||
Credit and security agreement entered date | Jul. 25, 2017 | ||||||
Amortization of debt issuance costs | $ 34,000 | $ 48,000 | $ 100,000 | $ 100,000 | |||
Additional interest (as a percent) | 5.00% | ||||||
Term Loan Credit Agreement | |||||||
Line Of Credit Facility [Line Items] | |||||||
Amount funded by Midcap under agreement | $ 25,000,000 | ||||||
Lines of credit facility available date | Apr. 30, 2018 | Mar. 31, 2018 | |||||
Loan amount outstanding | $ 40,000,000 | 35,000,000 | 35,000,000 | ||||
Debt scheduled maturity date | Dec. 1, 2021 | ||||||
Origination fee (as a percent) | 0.50% | ||||||
Unamortized debt issuance costs on term loan, current portion | 100,000 | 100,000 | |||||
Unamortized debt issuance costs on term loan, long-term portion | 200,000 | $ 200,000 | |||||
Term Loan Credit Agreement | London Interbank Offered Rate (LIBOR) | |||||||
Line Of Credit Facility [Line Items] | |||||||
Spread on variable rate basis (as a percent) | 7.50% | ||||||
Debt Instrument Reference Rate | 1.98% | ||||||
Term Loan Credit Agreement | Minimum | London Interbank Offered Rate (LIBOR) | |||||||
Line Of Credit Facility [Line Items] | |||||||
Debt instrument, interest rate floor | 1.00% | ||||||
March Two Thousand Eighteen Term Loan | |||||||
Line Of Credit Facility [Line Items] | |||||||
Line of Credit Facility, Remaining Borrowing Capacity | $ 10,000,000 | ||||||
Loan amount outstanding | $ 10,000,000 | ||||||
Additional Term Loan | |||||||
Line Of Credit Facility [Line Items] | |||||||
Line of Credit Facility, Remaining Borrowing Capacity | 5,000,000 | ||||||
Minimum revenue required to satisfy additional term loan facility | 75,000,000 | ||||||
Revolving Credit Agreement | |||||||
Line Of Credit Facility [Line Items] | |||||||
Loan amount outstanding | $ 10,000,000 | 0 | $ 0 | ||||
Borrowing base of accounts receivable (as a percent) | 85.00% | ||||||
Borrowing base of finished goods inventory (as a percent) | 40.00% | ||||||
Debt scheduled maturity date | Dec. 1, 2021 | ||||||
Origination fee (as a percent) | 0.50% | ||||||
Annual collateral management fee (as a percent) | 0.50% | ||||||
Annual unused line fee of average unused portion (as a percent) | 0.50% | ||||||
Revolving Credit Agreement | Other Long-Term Assets | |||||||
Line Of Credit Facility [Line Items] | |||||||
Unamortized debt issuance costs on term loan, long-term portion | $ 100,000 | $ 100,000 | |||||
Revolving Credit Agreement | London Interbank Offered Rate (LIBOR) | |||||||
Line Of Credit Facility [Line Items] | |||||||
Spread on variable rate basis (as a percent) | 4.50% | ||||||
Revolving Credit Agreement | Maximum | |||||||
Line Of Credit Facility [Line Items] | |||||||
Borrowing base availability from finished goods inventory (as a percent) | 20.00% | ||||||
Revolving Credit Agreement | Minimum | London Interbank Offered Rate (LIBOR) | |||||||
Line Of Credit Facility [Line Items] | |||||||
Debt instrument, interest rate floor | 1.00% |
Long-Term Debt and Revolving 53
Long-Term Debt and Revolving Loan (Schedule of Future Principal Payments for Outstanding Term Loans) (Details) - Term Loans $ in Thousands | Jun. 30, 2018USD ($) |
Line Of Credit Facility [Line Items] | |
2,019 | $ 11,666 |
2,020 | 11,667 |
2,021 | 11,667 |
Total | $ 35,000 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - $ / shares | Jun. 30, 2018 | Dec. 31, 2017 |
Stock other disclosures | ||
Common and preferred stock, shares authorized | 210,000,000 | 210,000,000 |
Common stock, shares authorized | 200,000,000 | 200,000,000 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Stockholders' Equity (Warrants)
Stockholders' Equity (Warrants) (Details) - $ / shares | Jan. 17, 2013 | Jun. 30, 2014 | Jun. 30, 2018 |
Common Stock Warrants | |||
Aggregate number of common shares to purchase | 47,710 | ||
Oxford Finance, LLC | |||
Common Stock Warrants | |||
Exercise price (in dollars per share) | $ 14.671 | $ 14.671 | |
Tranche A, B and C loans | Oxford Finance, LLC | |||
Common Stock Warrants | |||
Warrant term | 7 years | ||
Percentage of term loan amounts | 3.00% | ||
Tranche D term loan | Oxford Finance, LLC | |||
Common Stock Warrants | |||
Warrant term | 7 years | ||
Percentage of term loan amounts | 2.50% |
Stockholders' Equity (Options)
Stockholders' Equity (Options) (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | Nov. 03, 2014 | Apr. 30, 2007 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Number of shares available for future grants | 627,080 | 627,080 | |||||
Stock options | |||||||
Number of options | |||||||
Balance at the beginning of period (in shares) | 2,179,787 | ||||||
Options exercised (in shares) | (61,203) | ||||||
Options forfeited (in shares) | (69,896) | ||||||
Balance at the end of the period (in shares) | 2,048,688 | 2,048,688 | 2,179,787 | ||||
Weighted average exercise price | |||||||
Balance at the beginning of period (in dollars per share) | $ 7.60 | ||||||
Options exercised (in dollars per share) | 6.70 | ||||||
Options forfeited (in dollars per share) | 9.99 | ||||||
Balance at the end of period (in dollars per share) | $ 7.54 | $ 7.54 | $ 7.60 | ||||
Additional information | |||||||
Weighted average remaining contractual term | 6 years 8 months 19 days | 7 years 3 months 7 days | |||||
Stock-based compensation expense | $ 0.4 | $ 0.5 | $ 0.8 | $ 1.2 | |||
Unrecognized compensation costs (in dollars) | $ 1.8 | $ 1.8 | |||||
Weighted average period over which unrecognized compensation costs are expected to be recognized | 1 year 7 months 2 days | ||||||
2007 Plan | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Common stock initially reserved for issuance (in shares) | 1,690,448 | ||||||
2014 Plan | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Common stock initially reserved for issuance (in shares) | 1,027,500 | ||||||
Number of shares available for future grants | 244,977 | 244,977 | |||||
Inducement Plan | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Number of shares available for future grants | 327,912 | 327,912 | |||||
Number of shares awarded | 624,735 | ||||||
Grant period of stock awards | 10 years | ||||||
Number of additional years of requisite service period | 3 years | ||||||
Vesting period | 1 year | ||||||
Inducement Plan | On the first anniversary | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Vesting percentage | 25.00% | ||||||
Inducement Plan | Minimum | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Purchase price of awards expressed as a percentage of fair value of shares on the date of grant | 100.00% | ||||||
Percentage of possible payouts of the target award | 0.00% | ||||||
Inducement Plan | Minimum | Individual options | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Vesting percentage | 25.00% | ||||||
Inducement Plan | Maximum | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Percentage of possible payouts of the target award | 100.00% | ||||||
2007 Plan and 2014 Plan | Stock options | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Grant period of stock awards | 10 years | ||||||
2007 Plan and 2014 Plan | Stock options | Minimum | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Purchase price of awards expressed as a percentage of fair value of shares on the date of grant | 100.00% | ||||||
Percentage of voting power owned by shareholder | 10.00% | 10.00% | |||||
2007 Plan and 2014 Plan | Stock options | Maximum | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Purchase price of awards expressed as a percentage of fair value of shares on the date of grant | 110.00% |
Stockholders' Equity (Restricte
Stockholders' Equity (Restricted Stock) (Details) - Restricted stock units - 2014 Plan - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Stockholders' Equity, other disclosures | ||||
Requisite service period, quarterly | 4 years | |||
Requisite service period, annually | 3 years | |||
Stock-based compensation expense | $ 2.6 | $ 1.2 | $ 4.6 | $ 1.8 |
Unrecognized compensation costs (in dollars) | $ 16.4 | $ 16.4 | ||
Weighted average period over which unrecognized compensation costs are expected to be recognized | 2 years 2 months 12 days | |||
Number of shares | ||||
Balance at beginning of the period | 928,552 | |||
Granted | 1,327,746 | |||
Vested | (366,116) | |||
Forfeited | (106,330) | |||
Balance at end of the period | 1,783,852 | 1,783,852 | ||
Weighted average grant date fair value | ||||
Balance at beginning of the period | $ 9.12 | |||
Granted | 11.89 | |||
Vested | 8.86 | |||
Forfeited | 10.90 | |||
Balance at end of the period | $ 11.13 | $ 11.13 |
Stockholders' Equity (Stock Pur
Stockholders' Equity (Stock Purchase) (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Oct. 31, 2014 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Number of shares available for future grants | 627,080 | 627,080 | |||
2014 Employee Stock Purchase Plan | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Purchase period of offering | 6 months | ||||
Rate of purchase price of stock on fair value (as a percent) | 85.00% | ||||
Purchases under the award | 62,491 | ||||
Weighted Average purchase price | $ 6.26 | $ 6.26 | |||
Stock-based compensation expense | $ 0.1 | $ 0.1 | $ 0.3 | $ 0.2 | |
2014 Employee Stock Purchase Plan | Maximum | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Discount rate on the value of shares through payroll deductions (as a percent) | 15.00% | ||||
Expiration period of each offering | 27 months | ||||
Number of shares reserved for future issuance | 255,500 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Income Tax Disclosure [Abstract] | ||||
Tax expense | $ 0 | $ 29,000 | $ 0 | $ 54,000 |
Segment Information (Details)
Segment Information (Details) | 6 Months Ended |
Jun. 30, 2018USD ($)Segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | Segment | 2 |
Segments unallocated expenses | $ | $ 0 |
Segment Information - Summary o
Segment Information - Summary of Net Sales, Net Operating Loss and Net Assets by Reportable (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Segment Reporting Information [Line Items] | |||||
Total net sales | $ 17,554 | $ 8,169 | $ 32,229 | $ 15,658 | |
Total loss from operations | 16,898 | 20,210 | 35,826 | 31,627 | |
Total assets | 191,060 | 191,060 | $ 92,213 | ||
Breast Products | |||||
Segment Reporting Information [Line Items] | |||||
Total net sales | 9,412 | 8,169 | 17,954 | 15,658 | |
Total loss from operations | 12,444 | $ 20,210 | 25,238 | $ 31,627 | |
Total assets | 157,404 | 157,404 | 59,365 | ||
miraDry | |||||
Segment Reporting Information [Line Items] | |||||
Total net sales | 8,142 | 14,275 | |||
Total loss from operations | 4,454 | 10,588 | |||
Total assets | $ 33,656 | $ 33,656 | $ 32,848 |
Commitments and Contingencies (
Commitments and Contingencies (Details) | Jul. 29, 2018USD ($) | Nov. 11, 2017USD ($) | Sep. 07, 2017USD ($) | Jul. 27, 2017USD ($)USD_Per_Unit | Nov. 19, 2015lawsuit | Jun. 30, 2018USD ($) | Jun. 30, 2017USD ($) | Mar. 31, 2017USD ($) | Jun. 30, 2018USD ($) | Jun. 30, 2017USD ($) | Sep. 30, 2016USD ($) | Dec. 31, 2017USD ($) |
Operating Leases | ||||||||||||
Rent expense | $ 300,000 | $ 100,000 | $ 600,000 | $ 300,000 | ||||||||
Contingencies | ||||||||||||
General and administrative | $ 10,014,000 | $ 8,022,000 | $ 19,514,000 | $ 14,458,000 | ||||||||
Loss contingency paid | $ 1,000,000 | |||||||||||
Litigation settlement agreement, amount paid or to be paid | $ 9,000,000 | |||||||||||
Royalty payments on each of net sales per product | USD_Per_Unit | 12.50 | |||||||||||
Maximum | ||||||||||||
Contingencies | ||||||||||||
Royalty expense | $ 5,000,000 | |||||||||||
Class Action Lawsuits | ||||||||||||
Contingencies | ||||||||||||
Number of lawsuits filed | lawsuit | 3 | |||||||||||
General and administrative | $ 1,600,000 | |||||||||||
Contingency loss in period | 10,900,000 | |||||||||||
Insurance recovery receivable | $ 9,400,000 | |||||||||||
Received in insurance proceeds | $ 9,300,000 | |||||||||||
Loss contingency paid | $ 10,900,000 | |||||||||||
miraDry Class Action Litigation | ||||||||||||
Contingencies | ||||||||||||
Amount of Defendants (and/or their indemnitors and/or insurers) agreed to pay settlement consideration | $ 400,000 | |||||||||||
Litigation Settlement in 2018 | ||||||||||||
Contingencies | ||||||||||||
Litigation settlement agreement, amount paid or to be paid | $ 1,000,000 | |||||||||||
California | Santa Barbara | ||||||||||||
Operating Leases | ||||||||||||
Lease expiration date | Feb. 29, 2020 | |||||||||||
California | Santa Clara | ||||||||||||
Operating Leases | ||||||||||||
Lease expiration date | May 31, 2019 |