Document and Entity Information
Document and Entity Information - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Mar. 05, 2021 | Jun. 30, 2020 | |
Cover [Abstract] | |||
Entity Registrant Name | SIENTRA, INC. | ||
Entity Central Index Key | 0001551693 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2020 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Shell Company | false | ||
ICFR Auditor Attestation Flag | false | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
Entity Public Float | $ 188,807,000 | ||
Entity Common Stock, Shares Outstanding | 57,273,356 | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | SIEN | ||
Title of 12(b) Security | Common Stock, par value $0.01 per share | ||
Security Exchange Name | NASDAQ | ||
Entity File Number | 001-36709 | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 20-5551000 | ||
Entity Address, Address Line One | 420 South Fairview Avenue | ||
Entity Address, Address Line Two | Suite 200 | ||
Entity Address, City or Town | Santa Barbara | ||
Entity Address, State or Province | CA | ||
Entity Address, Postal Zip Code | 93117 | ||
City Area Code | 805 | ||
Local Phone Number | 562-3500 | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Documents Incorporated by Reference | Portions of the registrant’s definitive Proxy Statement relating to its 2020 Annual Meeting of Stockholders are incorporated by reference into Part III of this Annual Report on Form 10-K where indicated. Such Proxy Statement will be filed with the U.S. Securities and Exchange Commission within 120 days after the end of the fiscal year to which this report relates. |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 54,967 | $ 87,608 |
Accounts receivable, net of allowances of $4,464 and $3,835 at December 31, 2020 and December 31, 2019, respectively | 23,503 | 27,548 |
Inventories, net | 48,648 | 39,612 |
Prepaid expenses and other current assets | 2,154 | 2,489 |
Total current assets | 129,272 | 157,257 |
Property and equipment, net | 13,106 | 12,314 |
Goodwill | 9,202 | 9,202 |
Other intangible assets, net | 9,387 | 17,390 |
Other assets | 8,011 | 8,241 |
Total assets | 168,978 | 204,404 |
Current liabilities: | ||
Current portion of long-term debt | 4,670 | 6,508 |
Accounts payable | 6,504 | 9,352 |
Accrued and other current liabilities | 32,389 | 32,551 |
Customer deposits | 17,905 | 13,943 |
Sales return liability | 9,192 | 8,116 |
Total current liabilities | 70,660 | 70,470 |
Long-term debt | 60,500 | 38,248 |
Derivative liability | 26,570 | |
Deferred and contingent consideration | 2,350 | 5,177 |
Warranty reserve and other long-term liabilities | 9,455 | 8,627 |
Total liabilities | 169,535 | 122,522 |
Commitments and contingencies (Note 12) | ||
Stockholders’ equity (deficit): | ||
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 50,712,151 and 49,612,907 and outstanding 50,639,424 and 49,540,180 shares at December 31, 2020 and December 31, 2019, respectively | 506 | 495 |
Additional paid-in capital | 558,059 | 550,562 |
Treasury stock, at cost (72,727 shares at December 31, 2020 and December 31, 2019) | (260) | (260) |
Accumulated deficit | (558,862) | (468,915) |
Total stockholders’ equity (deficit) | (557) | 81,882 |
Total liabilities and stockholders’ equity (deficit) | $ 168,978 | $ 204,404 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Statement Of Financial Position [Abstract] | ||
Accounts receivable, allowances (in dollars) | $ 4,464 | $ 3,835 |
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 | 50,712,151 | 49,612,907 |
Common stock, shares outstanding | 50,639,424 | 49,540,180 |
Treasury stock, shares | 72,727 | 72,727 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Statement [Abstract] | |||
Net sales | $ 71,241 | $ 83,699 | $ 68,126 |
Cost of goods sold | 32,302 | 33,012 | 26,822 |
Gross profit | 38,939 | 50,687 | 41,304 |
Operating expenses: | |||
Sales and marketing | 52,553 | 80,189 | 67,715 |
Research and development | 10,311 | 13,537 | 10,945 |
General and administrative | 38,191 | 46,771 | 42,418 |
Restructuring | 1,762 | 1,083 | |
Impairment | 6,432 | 12,674 | |
Total operating expenses | 109,249 | 154,254 | 121,078 |
Loss from operations | (70,310) | (103,567) | (79,774) |
Other income (expense), net: | |||
Interest income | 206 | 1,406 | 532 |
Interest expense | (9,451) | (4,568) | (3,428) |
Change in fair value of derivative liability | (10,470) | ||
Other income (expense), net | 111 | (55) | 39 |
Total other income (expense), net | (19,604) | (3,217) | (2,857) |
Loss before income taxes | (89,914) | (106,784) | (82,631) |
Income tax | 33 | 34 | (4) |
Net loss | $ (89,947) | $ (106,818) | $ (82,627) |
Basic and diluted net loss per share attributable to common stockholders | $ (1.79) | $ (2.63) | $ (3.25) |
Weighted average outstanding common shares used for net loss per share attributable to common stockholders: | |||
Basic and diluted | 50,233,175 | 40,654,272 | 25,402,241 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity (Deficit) - USD ($) $ in Thousands | Total | Common stock | Treasury stock | Additional paid-in capital | Accumulated deficit |
Balance, beginning of year at Dec. 31, 2017 | $ 27,623 | $ 194 | $ (260) | $ 307,159 | $ (279,470) |
Balance, beginning of year (in shares) at Dec. 31, 2017 | 19,474,702 | 72,727 | |||
Proceeds from follow-on offering, net of costs | 107,551 | $ 85 | 107,466 | ||
Proceeds from follow-on offering, net of costs (in shares) | 8,518,519 | ||||
Employee stock-based compensation expense | 13,824 | 13,824 | |||
Stock option exercises | 1,149 | $ 1 | 1,148 | ||
Stock option exercises (in shares) | 147,463 | ||||
Employee stock purchase program (ESPP) | 993 | $ 2 | 991 | ||
Employee stock purchase program (ESPP) (in shares) | 145,616 | ||||
Vested restricted stock | $ 5 | (5) | |||
Vested restricted stock (in shares) | 523,257 | ||||
Shares withheld for tax obligations on vested RSUs | (1,635) | $ (1) | (1,634) | ||
Shares withheld for tax obligations on vested RSUs, shares | (108,063) | ||||
Net loss | (82,627) | (82,627) | |||
Balance, end of year at Dec. 31, 2018 | 66,878 | $ 286 | $ (260) | 428,949 | (362,097) |
Balance, end of year (in shares) at Dec. 31, 2018 | 28,701,494 | 72,727 | |||
Proceeds from follow-on offering, net of costs | 107,734 | $ 200 | 107,534 | ||
Proceeds from follow-on offering, net of costs (in shares) | 20,000,000 | ||||
Employee stock-based compensation expense | 12,655 | 12,655 | |||
Stock option exercises | 125 | 125 | |||
Stock option exercises (in shares) | 51,451 | ||||
Employee stock purchase program (ESPP) | 1,216 | $ 1 | 1,215 | ||
Employee stock purchase program (ESPP) (in shares) | 175,624 | ||||
Vested restricted stock | $ 10 | (10) | |||
Vested restricted stock (in shares) | 944,467 | ||||
Shares withheld for tax obligations on vested RSUs | (3,064) | $ (2) | (3,062) | ||
Shares withheld for tax obligations on vested RSUs, shares | (260,129) | ||||
Equity contingent consideration | 3,156 | 3,156 | |||
Net loss | (106,818) | (106,818) | |||
Balance, end of year at Dec. 31, 2019 | 81,882 | $ 495 | $ (260) | 550,562 | (468,915) |
Balance, end of year (in shares) at Dec. 31, 2019 | 49,612,907 | 72,727 | |||
Proceeds from follow-on offering, net of costs | 263 | 263 | |||
Proceeds from follow-on offering, net of costs (in shares) | 37,000 | ||||
Employee stock-based compensation expense | 8,171 | 8,171 | |||
Stock option exercises | 29 | 29 | |||
Stock option exercises (in shares) | 9,817 | ||||
Employee stock purchase program (ESPP) | 836 | $ 2 | 834 | ||
Employee stock purchase program (ESPP) (in shares) | 203,728 | ||||
Vested restricted stock | $ 12 | (12) | |||
Vested restricted stock (in shares) | 1,150,707 | ||||
Shares withheld for tax obligations on vested RSUs | (1,791) | $ (3) | (1,788) | ||
Shares withheld for tax obligations on vested RSUs, shares | (302,008) | ||||
Net loss | (89,947) | (89,947) | |||
Balance, end of year at Dec. 31, 2020 | $ (557) | $ 506 | $ (260) | $ 558,059 | $ (558,862) |
Balance, end of year (in shares) at Dec. 31, 2020 | 50,712,151 | 72,727 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Cash flows from operating activities: | |||
Net loss | $ (89,947) | $ (106,818) | $ (82,627) |
Adjustments to reconcile net loss to net cash used in operating activities | |||
Impairment | 6,432 | 12,674 | |
Depreciation and amortization | 4,094 | 3,524 | 3,321 |
Provision for doubtful accounts | 4,423 | 2,298 | 2,043 |
Provision for warranties | 1,271 | 929 | 325 |
Provision for inventory | 3,601 | 2,626 | 955 |
Fair value adjustments to derivative liability | 10,470 | ||
Fair value adjustments of other liabilities held at fair value | 96 | 969 | 2,447 |
Amortization of debt discount and issuance costs | 4,347 | 359 | 174 |
Stock-based compensation expense | 8,344 | 12,478 | 13,824 |
Payments of contingent consideration liability in excess of acquisition-date fair value | (1,968) | (320) | |
Other non-cash adjustments | 375 | 290 | 90 |
Changes in operating assets and liabilities: | |||
Accounts receivable | (378) | (7,320) | (14,094) |
Inventories | (12,808) | (10,921) | (4,144) |
Prepaid expenses, other current assets and other assets | 935 | (8,513) | (1,263) |
Accounts payable, accrueds, and other liabilities | (6,420) | 6,694 | 17,014 |
Customer deposits | 3,961 | 4,008 | 4,513 |
Sales return liability | 1,077 | 2,068 | 2,142 |
Legal settlement payable | (410) | (590) | |
Net cash used in operating activities | (60,127) | (87,033) | (56,190) |
Cash flows from investing activities: | |||
Purchase of property and equipment | (4,037) | (4,071) | (855) |
Business acquisitions, net of cash and restricted cash acquired | (17,943) | ||
Net cash used in investing activities | (4,037) | (22,014) | (855) |
Cash flows from financing activities: | |||
Proceeds from option exercises and employee stock purchase plan | 865 | 1,341 | 2,142 |
Net proceeds from issuance of common stock | 263 | 107,734 | 107,551 |
Payments related to tax witholding on vested restricted stock units (RSUs) | (1,791) | (3,064) | (1,635) |
Gross borrowings under the Term Loan | 5,000 | 10,000 | |
Repayments under the Term Loan | (25,000) | ||
Repayment of the Revolving Loan | (6,508) | (15,788) | (12,109) |
Net proceeds from issuance of the Convertible Note | 60,000 | ||
Payments of contingent consideration up to acquisition-date fair value | (5,766) | (680) | |
Deferred financing costs | (2,958) | (1,997) | (22) |
Net cash provided by financing activities | 31,523 | 109,756 | 117,356 |
Net increase (decrease) in cash, cash equivalents and restricted cash | (32,641) | 709 | 60,311 |
Cash, cash equivalents and restricted cash at: | |||
Beginning of period | 87,951 | 87,242 | 26,931 |
End of period | 55,310 | 87,951 | 87,242 |
Reconciliation of cash, cash equivalents, and restricted cash to the consolidated balance sheets | |||
Cash and cash equivalents | 54,967 | 87,608 | 86,899 |
Restricted cash included in other assets | 343 | $ 343 | $ 343 |
Restricted Cash Noncurrent Asset Statement Of Financial Position Extensible List | us-gaap:OtherNoncurrentAssetsMember | us-gaap:OtherNoncurrentAssetsMember | |
End of period | 55,310 | $ 87,951 | $ 87,242 |
Supplemental disclosure of cash flow information: | |||
Interest paid | 4,198 | 4,089 | 3,120 |
Supplemental disclosure of non-cash investing and financing activities: | |||
Property and equipment in accounts payable and accrued liabilities | 413 | 745 | 679 |
Acquisition of business, deferred and contingent consideration obligations at fair value | 9,063 | ||
Non-cash deferred consideration settlement | 1,000 | ||
Non-cash settlement of assets held for sale in accounts payable | 2,674 | ||
Revolving Loan | |||
Cash flows from financing activities: | |||
Gross borrowings | $ 22,296 | $ 12,109 | |
Paycheck Protection Program | |||
Cash flows from financing activities: | |||
Gross borrowings | $ 6,652 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | (1) Summary of Significant Accounting Policies (a) Basis of Presentation and Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America, or GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the dates of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Assets and liabilities which are subject to significant judgment and use of estimates include the allowance for doubtful accounts, sales return liability, provision for warranties, valuation of inventories, recoverability of long-lived assets, valuation allowances with respect to deferred tax assets, useful lives associated with property and equipment and finite lived intangible assets, and the valuation and assumptions underlying stock-based compensation and other equity instruments. On an ongoing basis, the Company evaluates its estimates compared to historical experience and trends, which form the basis for making judgments about the carrying value of assets and liabilities. In addition, the Company engages the assistance of valuation specialists in concluding on fair value measurements in connection with stock-based compensation and other equity instruments. (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 decrease with the change in the miraDry business strategy, but 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 and the convertible note, sales of products since 2012, and the proceeds from the sale of common stock in public offerings. To fund ongoing operating and capital needs, the Company may need to raise additional capital in the future through the sale of equity securities and incremental debt financing. Debt financing On July 25, 2017, the Company entered into the Existing Credit Agreements with Midcap. On July 1, 2019, the Company entered into certain credit agreements with Midcap Financial Trust pursuant to which the Company repaid their existing indebtedness under the Existing Credit Agreements and the outstanding commitment fee was cancelled. Further, on May 11, 2020 and February 5, 2021, the Company amended certain credit agreements with Midcap Financial Trust. On March 11, 2020, the Company entered into a facility agreement with Deerfield Partners, L.P., issuing $60.0 million in principal amount of 4.0% unsecured and subordinated convertible notes upon the terms and conditions set forth in the facility agreement. In April 2020, the Company was granted a loan of $6.7 million under the Paycheck Protection Program of the CARES Act, or the PPP Loan, all or a portion of which may be forgiven dependent on the use of proceeds. The PPP Loan matures on April 20, 2022 and bears interest at a rate of 1.0% per annum. All or a portion of the PPP Loan may be forgiven upon submission of documentation of expenditures in accordance with certain specified requirements. The Company sought and obtained the PPP Loan due to the immediate and continued impact of the COVID-19 pandemic on revenues and prospects. The PPP Loan has allowed the Company to satisfy payroll obligations without a material reduction in pay for employees or a material headcount reduction, other than the reductions in the previously announced organizational efficiency initiative. See Note 7 to the consolidated financial statements for a full description of our long-term debt, revolving line of credit, convertible note, and PPP loan. Equity financing 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 its common stock having an aggregate gross offering price of up to $50.0 million. As of December 31, 2020, the Company has sold 37,000 shares of its common stock pursuant to the sales agreement. On May 7, 2018, the Company completed an underwritten follow-on public offering in which the Company sold 7,407,408 shares of common stock at $13.50 per share, as well as 1,111,111 additional shares of common stock pursuant to the full exercise of the over-allotment option granted to the underwriters. Net proceeds were approximately $107.6 million after deducting underwriting discounts and commissions of $6.9 million and offering expenses of approximately $0.5 million. Further, on June 7, 2019, the Company completed an underwritten follow-on public offering of 17,391,305 shares of common stock at $5.75 per share, as well as 2,608,695 additional shares of common stock pursuant to the full exercise of the over-allotment option granted to the underwriters. Net proceeds were approximately $107.7 million after deducting underwriting discounts and commissions of $6.9 million and offering expenses of approximately $0.4 million. At December 31, 2020, the Company had cash and cash equivalents of $55.0 million. The accompanying 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. The Company believes that its cash and cash equivalents will be sufficient to fund its operations for at least the next 12 months. (c) Cash and Cash Equivalents The Company considers all highly liquid investments purchased with an original maturity of three months or less when purchased to be cash equivalents. Cash and cash equivalents consist primarily of cash in checking accounts and interest-bearing money market accounts. (d) Concentration of Credit and Supplier Risks Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash and cash equivalents. The Company’s cash and cash equivalents are deposited in demand accounts at financial institutions that management believes are creditworthy. The Company is exposed to credit risk in the event of default by these financial institutions for cash and cash equivalents in excess of amounts insured by the Federal Deposit Insurance Corporation, or FDIC. Management believes that the Company’s investments in cash and cash equivalents are financially sound and have minimal credit risk and the Company has not experienced any losses on its deposits of cash and cash equivalents. The Company relies on a limited number of third-party manufacturers for the manufacturing and supply of its products. This could result in the Company not being able to acquire the inventory needed to meet customer demand, which would result in possible loss of sales and affect operating results adversely. (e) 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, contingent consideration, and the convertible feature related to the convertible note are discussed in Note 1(f) below. The fair value of the debt is based on the amount of future cash flows associated with the instrument discounted using the Company’s market rate. As of December 31, 2020, the carrying value of the long-term debt was not materially different from the fair value. As of December 31, 2020, the carrying value and fair value of the convertible note were as follows (in thousands): December 31, 2020 Carrying Value Fair Value Convertible note $ 44,436 $ 37,580 The convertible note is carried on the consolidated balance sheets at amortized cost. The fair value is estimated using a discounted cash flow analysis with a yield derived from a calibrated binomial lattice model as of the convertible note issuance date and adjusted for market movements thereafter. The market for trading of the convertible note is not considered to be an active market and therefore the estimate of fair value is based on Level 2 inputs. (f) 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. (g) Property and Equipment Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is computed using the straight‑line method over the estimated useful life of the asset, generally three to fifteen years. Leasehold improvements are depreciated over the shorter of the lease term or the estimated useful life of the related asset. Upon retirement or sale of an asset, the cost and related accumulated depreciation or amortization are removed from the consolidated balance sheet and any resulting gain or loss is reflected in operations in the period realized. Maintenance and repairs are charged to operations as incurred. (h) Leases The Company leases certain office space, warehouses, distribution facilities, manufacturing facilities and office equipment. The Company also has embedded leases of manufacturing facilities and equipment associated with the Company’s manufacturing contracts. The Company determines if an arrangement contains a lease at inception by evaluating whether the arrangement conveys the right to use an identified asset and whether the Company obtains substantially all of the economic benefits from and has the ability to direct the use of the asset. Operating and finance lease right-of-use, or ROU, assets and lease liabilities are recognized based on the present value of the future lease payments over the lease term at the commencement date. The Company determines its incremental borrowing rate based on the information available at the commencement date in determining the lease liabilities as the Company’s leases generally do not provide an implicit rate. The ROU assets also include any initial direct costs incurred and any lease payments made at or before the lease commencement date, less lease incentives received. Lease terms may include options to extend or terminate when the Company is reasonably certain that the option will be exercised. The Company elected to apply the short-term lease measurement and recognition exemption in which ROU assets and lease liabilities are not recognized for short-term leases. The Company’s lease agreements generally do not contain material residual value guarantees or material restrictive covenants. The Company’s leases of office space, warehouses, distribution facilities and manufacturing facilities are treated as operating leases and often contain lease and non-lease components. The Company has elected to account for these lease and non-lease components separately. Non-lease components for these assets are primarily comprised of common-area maintenance, utilities, and real estate taxes that are passed on from the lessor in proportion to the space leased by the Company, and are recognized in operating expenses in the period in which the obligation for those payments was incurred. Lease cost for these operating leases is recognized on a straight-line basis over the lease term in operating expenses. The Company’s embedded leases of manufacturing facilities and equipment are treated as operating leases and often contain lease and non-lease components. The Company has elected to account for these lease and non-lease components as a single lease component. There may be variability in future lease payments as the amount of the non-lease components is based on the costs of manufacturing and is dependent on the amount and types of units produced. The Company reduces the operating lease liability when the inventory is purchased. The Company’s leases of office equipment are accounted for as finance leases as they meet one or more of the five finance lease classification criteria. Lease cost for these finance leases is comprised of amortization of the ROU asset and interest expense which are recognized in operating expenses and other income (expense), net. ( i ) Goodwill and Other Intangible Assets Goodwill Goodwill represents the excess of the purchase price over the fair value of net assets of purchased businesses. Goodwill is not amortized, but instead is subject to impairment tests on at least an annual basis and whenever circumstances suggest that goodwill may be impaired. After the acquisition of miraDry, management began evaluating the Company as two reporting units, Breast Products and miraDry. 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 more likely than not that the fair value of a reporting unit is less than its carrying amount from the qualitative assessment, the Company performs a quantitative analysis to compare the fair value of the reporting unit to its carrying amount. The Company recognizes impairment charges for the amount by which the carrying amount exceeds the reporting unit’s fair value. The Company’s fair value analysis of goodwill utilizes the income approach and market approach, which requires the use of estimates about a reporting unit’s future revenues and free cash flows, market multiples, enterprise value, control risk premiums, discount rates, terminal value and enterprise value to determine the estimated fair value. The Company’s future revenues and free cash flow assumptions are determined based upon actual results giving effect to management’s expected changes in operating results in future years. The market multiples, enterprise value, control risk premiums, discount rates and terminal value are based upon market participant assumptions using a defined peer group. Changes in these assumptions can materially affect these estimates. Thus, to the extent the market changes, discount rates increase significantly or the Company do es not meet its projected performance, the Company could recognize impairments, and such impairments could be material. In the second quarter of 2019, the Company recorded a full impairment of goodwill in the miraDry reporting unit after performing a quantitative analysis. Refer to Note 5(a) for further details. Indefinite-lived intangible assets The Company tests indefinite-lived intangible assets for impairment on at least an annual basis and whenever circumstances suggest the assets may be impaired. The Company’s annual test for impairment is performed as of October 1 of each fiscal year. If indicators of impairment are present, the Company evaluates the carrying value of the intangible assets in relation to estimates of future undiscounted cash flows. If the carrying value of the intangible asset exceeds its fair value, an impairment loss is recognized in an amount equal to the difference. The Company also evaluates the remaining useful life of an indefinite-lived intangible asset to determine whether events and circumstances continue to support an indefinite useful life. For the years ended December 31, 2020, 2019, and 2018, the Company did not record any indefinite-lived intangible assets impairment charges. Finite-lived intangible assets The intangible assets are amortized to the consolidated statement of operations based on estimated cash flows generated from the intangible asset over its estimated life. Each fiscal year the Company evaluates the estimated remaining useful lives of purchased intangible assets and whether events or changes in circumstance warrant a revision to the remaining periods of amortization. Judgments about the recoverability of purchased finite‑lived intangible assets are made whenever events or changes in circumstance indicate that impairment may exist. Recoverability of finite‑lived intangible assets is measured by comparison of the carrying amount of the asset group to the future undiscounted cash flows the asset group is expected to generate. If the sum of the future undiscounted cash flows is less than the carrying value, the Company will evaluate whether the fair value of each asset in the asset group exceeds its respective carrying value. If the fair value of any asset in the asset group is determined to be less than its carrying value, then the Company will recognize an impairment loss based on the excess of the carrying amount over the asset’s respective fair value. The Company’s fair value analysis of intangible assets utilizes methods under various income approaches. The Company values its customer relationships using an excess earnings method, which assumes the value of the asset is the discounted future cash flows derived from existing customers and requires the use of customer attrition rates and discount rates to determine the estimated fair value. The future revenues and free cash flow from existing customers are determined based upon actual results giving effect to management’s expected changes in operating results in future years. The attrition rate is based on average historical levels of customer attrition and the discount rate is based upon market participant assumptions using a defined peer group. Tradenames and developed technology are valued using a relief from royalty method, which assumes the value of the asset is the discounted cash flows of the amount that would be paid by a hypothetical market participant had they not owned the asset and instead licensed the asset from another company. This method requires the use of royalty rates which are determined based on comparable third-party license agreements involving similar assets and discount rates similar to the above to determine the estimated fair value. In the second quarter of 2019, the Company recorded a partial impairment of intangible assets in the miraDry reporting unit after performing a quantitative analysis and subsequently recorded a full impairment in the first quarter of 2020. Refer to Note 5(b) for further details. ( j ) Impairment of Tangible Long‑Lived Assets The Company’s management routinely considers whether indicators of impairment of long‑lived assets are present. If such indicators are present, management determines whether the sum of the estimated undiscounted cash flows attributable to the asset group in question is less than their carrying value. If less, the Company will recognize an impairment loss based on the excess of the carrying amount of the assets over their respective fair values. Fair value is determined by discounted future cash flows, appraisals or other methods. If the assets determined to be impaired are to be held and used, the Company will recognize an impairment charge to the extent the present value of anticipated net cash flows attributable to the asset are less than the asset’s carrying value. The fair value of the asset will then become the asset’s new carrying value. ( k ) Business Combinations Business combinations are accounted for using the acquisition method of accounting. Under the acquisition method, assets acquired and liabilities assumed are recorded at their respective fair values as of the acquisition date in the financial statements. The excess of the fair value of consideration transferred over the fair value of the net assets acquired is recorded as goodwill. Liability-classified contingent consideration obligations incurred in connection with a business combination are recorded at their fair values on the acquisition date and remeasured at their fair values each subsequent reporting period until the related contingencies are resolved. The resulting changes in fair values are recorded in earnings. Equity-classified contingent consideration obligations incurred in connection with a business combination are recorded at their fair values on the acquisition date and are not subsequently remeasured each reporting period unless the obligation becomes reclassified as a liability. The subsequent settlement of the obligation is accounted for within equity. ( l ) Reportable 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 howe 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. Based on the financial information presented to and reviewed by the CODM, the Company has determined that it has two reportable segments: Breast Products and miraDry. ( m ) Revenue Recognition The Company generates revenue primarily through the sale and delivery of promised goods or services to customers. Sales prices are documented in the executed sales contract, purchase order or order acknowledgement prior to the transfer of control to the customer. Typical payment terms are 30 days for Breast Products and direct sales of consumable miraDry products and tend to be longer for capital sales of miraDry Systems and sales to miraDry distributors, but do not extend beyond one year. Revenue contracts may include multiple products or services, each of which is considered a separate performance obligation. Performance obligations typically include the delivery of promised products, such as breast implants, tissue expanders, BIOCORNEUM, miraDry Systems and bioTips, along with service-type warranties. Other deliverables are sometimes promised but are ancillary and insignificant in the context of the contract as a whole. Revenue is allocated to each performance obligation based on its relative standalone selling price. The Company determines standalone selling prices based on observable prices for all performance obligations with the exception of the service-type warranty under the Platinum20 Limited Warranty Program, or Platinum20. The Company introduced Platinum20 in May 2018 on all OPUS breast implants implanted in the United States or Puerto Rico on or after May 1, 2018. Platinum20 provides for financial assistance for revision surgeries and no-charge contralateral replacement implants upon the occurrence of certain qualifying events. The Company considers Platinum20 to have an assurance warranty component and a service warranty component. The assurance component is recorded as a warranty liability at the time of sale (as discussed in Note 1(t)). The Company considers the service warranty component as an additional performance obligation and defers revenue at the time of sale using the expected cost plus margin approach for the performance obligation. Inputs into the expected cost plus margin approach include historical incidence rates, estimated replacement costs, estimated financial assistance payouts and an estimated margin. The liability for unsatisfied performance obligations under the service warranty as of December 31, 2020 were as follows (in thousands): Year Ended December 31, 2020 Balance as of December 31, 2019 $ 1,596 Additions and adjustments 2,137 Revenue recognized (1,115 ) Balance as of December 31, 2020 $ 2,618 Revenue for service warranties are recognized ratably over the term of the agreements. Specifically for Platinum20, the performance obligation is satisfied at the time that the benefits are provided and are expected to be satisfied over the following 3 to 24 month period for financial assistance and 20 years for product replacement. For delivery of promised products, control transfers and revenue is recognized upon shipment, unless the contractual arrangement requires transfer of control when products reach their destination, for which revenue is recognized once the product arrives at its destination. For Breast Products, 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 miraDry, in addition to domestic and international direct sales, the Company 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 both direct sales agreements (domestic and international), and international distributor 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. Sales Return Liability 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. A sales return liability is established based on estimated returns using relevant historical experience taking into consideration recent gross sales and notifications of pending returns, as adjusted for changes in recent industry events and trends. The estimated sales returns are recorded as a reduction of revenue and as a sales return 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 following table provides a rollforward of the sales return liability (in thousands): Year Ended December 31, 2020 2019 Beginning balance $ 8,116 $ 6,048 Addition to reserve for sales activity 118,508 105,496 Actual returns (117,407 ) (104,148 ) Change in estimate of sales returns (25 ) 720 Ending balance $ 9,192 $ 8,116 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 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. For the Breast Products segment, s hipping and handling activities are largely provided to customers free of charge . The associated costs were $2.9 million, $1.9 million and $1.3 million for the years ended December 31, 2020 , 2019 , and 2018 , respectively. 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 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 consolidated statement of operations. The associated costs were $0.3 million , $0.7 million , and $0.4 million for the years ended December 31, 2020 , 2019 , and 2018 , respectively. ( n ) Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are recorded at the invoiced amount and do not bear interest. The Company maintains allowances for doubtful accounts for estimated losses resulting from the inability to collect from some of its customers. The allowances for doubtful accounts are based on the analysis of historical bad debts, customer credit‑worthiness, past transaction history with the customer, and current economic trends. If the financial condition of the Company’s customers were to deteriorate, adversely affecting their ability to make payments, additional allowances may be required. ( o ) Inventories and Cost of Goods Sold Inventories represent raw materials, work in process and finished goods that are recorded at the lower of cost or market on a first‑in, first‑out basis, or FIFO. The Company recognizes the cost of inventory transferred to the customer in cost of goods sold when revenue is recognized. Further, the Company periodically assesses the recoverability of all inventories to determine whether adjustments for impairment or obsolescence are required. The Company evaluates the remaining shelf life and other general obsolescence and impairment criteria in assessing the recoverability of the Company’s inventory. ( p ) Income Taxes The Company accounts for income taxes under the asset and liability method. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts expected to be realized. The Company the Company The Company accounts for uncertain tax positions in accordance with Account Standards Codification, or ASC, 740‑10, Accounting for Uncertainty in Income Taxes ( q ) Research and Development Expenditures Research and development costs are charged to operating expenses as incurred. Research and development, or R&D, primarily consist of clinical expenses, regulatory expenses, product development, consulting services, outside research activities, quality control and other costs associated with the development of the Company’s products and compliance with Good Clinical Practices, or GCP, requirements. R&D expenses also include related personnel and consultant compensation and stock-based compensation expense. ( r ) Advertising Expenses related to advertising are charged to sales and marketing expense as incurred. Advertising costs were $3.6 million, $6.1 million and $1.3 million for the years ended December 31, 2020, 2019 and 2018, respectively. ( s ) Stock‑Based Compensation The Company applies the fair value provisions of ASC 718, Compensation — Stock Compensation The option-pricing models require the input of subjective assumptions, including the risk‑free interest rate, expected dividend yield, expected volatility and expected term, among other inputs. These estimates involve inherent uncertainties and the application of management’s judgment. If factors change and different assumptions are used, our stock‑based compensation expense could be materially different in the future. These assumptions are estimated as follows: • Risk‑free interest rate —The risk‑free interest rate is based on the yields of U.S. Treasury securities with maturities similar to the expected term of the options for each option group. • Dividend yield —The |
Restructuring
Restructuring | 12 Months Ended |
Dec. 31, 2020 | |
Restructuring And Related Activities [Abstract] | |
Restructuring | (2) Restructuring On November 6, 2019, the Board of Directors of the Company approved an organizational efficiency initiative (the “Plan”) designed to reduce spending and simplify operations. Under the Plan, the Company implemented numerous initiatives to reduce spending, including closing the Santa Clara offices of miraDry, Inc. and consolidating a number of business support services via a shared services organization at the Company’s Santa Barbara headquarters. As of December 31, 2020, the Company has completed its restructuring plan, incurred cumulative restructuring charges to date, and does not anticipate incurring restructuring charges in connection with this Plan in future periods. Under the Plan, the Company reduced its workforce by terminating approximately 60 employees. As a result, the Company incurred total charges of $2.3 million in connection with one-time employee termination costs, retention costs and other benefits. In addition, the Company incurred $0.5 million related to duplicate operating costs and other associated costs. In total, the Plan incurred charges of $2.8 million, excluding non-cash charges. The following table details the activity of liabilities related to the Plan included in "Accrued and other current liabilities" in the consolidated balance sheet as of December 31, 2020 (amounts in thousands): Severance costs Other associated costs Duplicate operating costs Balance at December 31, 2019 $ 894 $ — $ — Costs charged to expense 1,380 208 174 Costs paid or otherwise settled (2,274 ) (208 ) (174 ) Balance at December 31, 2020 $ — $ — $ — The following table details the charges by reportable segment, recorded in "Restructuring" under operating expenses in the consolidated statements of operations for the year ended December 31, 2020 by segment (amounts in thousands): Year Ended Year Ended Cumulative Restructuring December 31, 2019 December 31, 2020 Charges Breast Products $ 499 $ 390 $ 889 miraDry 584 1,372 1,956 Total $ 1,083 $ 1,762 $ 2,845 |
Acquisitions
Acquisitions | 12 Months Ended |
Dec. 31, 2020 | |
Business Combinations [Abstract] | |
Acquisitions | (3) Acquisitions Acquisition of certain assets from Vesta Intermediate Funding, Inc. On November 7, 2019, the Company entered into an Asset Purchase Agreement with Vesta Intermediate Funding, Inc., pursuant to which the Company purchased certain assets and obtained a non-exclusive, royalty-free, perpetual, irrevocable, assignable, sublicensable, and worldwide license to certain intellectual property owned by Vesta. In consideration of the acquisition, the Company paid $14.0 million in cash on the closing date and $5.1 million for additional inventory. The Company will pay an additional $3.2 million and $3.0 million in cash on November 7, 2021 and November 7, 2023, respectively. In addition, in the event the closing price of the Company’s common stock equals or exceeds a certain agreed upon price target, or the First Milestone Price Target, on any date through November 7, 2023, the Company will issue Vesta 303,721 shares of common stock within five business days of such date and in the event the closing price of the Company’s common stock equals or exceeds a second agreed upon price target, or the Second Milestone Price Target, on any date through November 7, 2023, the Company will issue Vesta 303,721 shares of common stock within five business days of such date. The Company will use its commercially reasonable efforts to file and maintain a resale registration statement registering the resale of the milestone shares. The transaction, which closed on November 7, 2019, or the Acquisition Date, will allow the Company to achieve a greater degree of vertical integration, obtaining direct control of breast implant manufacturing and product development activities and generating production-related cost synergies. The acquired set of activities, which includes all the inputs, processes, and outputs related to the manufacturing of the Company’s gel breast implants, was determined to meet the definition of a business as outlined in ASC 805. In connection with the acquisition, the Company recorded $2.6 million of professional fees for the year ended December 31, 2019, which are included in general and administrative expense. The aggregate acquisition date fair value of the consideration transferred was approximately $27.0 million, consisting of the following (in thousands): Fair Value Cash consideration at Acquisition Date $ 14,000 Deferred consideration 4,737 Equity contingent consideration 3,156 Purchase price for additional inventory purchase 5,113 Total purchase consideration $ 27,006 The Company funded the cash consideration amount with cash on hand. The deferred consideration represents the fair value of the additional cash to be paid on the second and fourth anniversaries following the closing date. The equity contingent consideration represents Vesta’s contractual right to receive potential future consideration in the form of shares of Sientra common stock upon achievement of certain price milestones of the Company’s common stock (the First and Second Milestone Price Targets). The fair value of the equity contingent consideration at the acquisition date was determined using a Monte-Carlo simulation model. The inputs include the Company’s closing stock price as of the valuation date, Company-specific historical equity volatility, and the risk-free rate. Equity contingent consideration was determined to be equity classified and is therefore not subsequently remeasured each reporting period unless the obligation becomes reclassified as a liability, and subsequent settlement of the obligation will be accounted for within equity. The additional inventory purchase represents cash paid for inventory and ordering supplies needed to support the acquired manufacturing process, at cost in accordance with the Transition Services Agreement. As of December 31, 2019, $3.9 million of the additional inventory purchase was funded with cash on hand, and the remaining $1.2 million is included in “Accrued and other current liabilities” on the consolidated balance sheet. 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): November 7, 2019 Inventories $ 7,138 Property and equipment 7,304 Goodwill 4,324 Intangible assets 8,240 Net assets acquired $ 27,006 Goodwill was allocated to the Breast Products reportable segment. The goodwill recognized is attributable primarily to the assembled workforce and additional market opportunities and is deductible for tax purposes. The intangible assets consist of intellectual property related to manufacturing know-how. The intellectual property has an estimated useful life of 19 years and is amortized using an accelerated method of 95% of the benefit realized. The Company retained an independent third-party appraiser to assist management in its valuation and the purchase price has been finalized. Prior to its acquisition, the Company had engaged Vesta for the manufacture and supply of the Company’s breast implants. In connection with the acquisition, the Company entered into a Termination and Release Agreement with Vesta, effectively terminating the existing manufacturing agreement between the Company and Vesta. The Company evaluated the settlement of the pre-existing relationship under the provisions of ASC 805 and recognized no gain or loss as a result of the termination. The results of the acquired business have been included in the consolidated financial statements from November 7, 2019 through December 31, 2020 and have been included in the Breast Products segment. Disclosure of pro forma combined revenue have not been presented because the effect of the acquisition had no impact on the Company’s revenue. Disclosure of pro forma combined earnings have not been presented because it is impracticable to do so due to a variety of limitations, including a lack of readily available historical GAAP financial statements. |
Balance Sheet Components
Balance Sheet Components | 12 Months Ended |
Dec. 31, 2020 | |
Balance Sheet Related Disclosures [Abstract] | |
Balance Sheet Components | (4) Balance Sheet Components Inventories, net consist of the following (in thousands): December 31, December 31, 2020 2019 Raw materials $ 7,138 $ 8,095 Work in progress 12,303 5,543 Finished goods 25,791 23,893 Finished goods - right of return 3,416 2,081 $ 48,648 $ 39,612 At December 31, 2020 and 2019, approximately $5.7 million and $2.7 million, respectively, of the Company’s Breast Products segment inventory was held on consignment at doctors’ offices, clinics, and hospitals. The value and quantity at any one location is not significant. Property and equipment, net consist of the following (in thousands): December 31, December 31, 2020 2019 Leasehold improvements $ 2,857 $ 2,841 Manufacturing equipment and toolings 9,289 8,175 Computer equipment 2,776 1,250 Software 3,546 2,602 Office equipment 167 111 Furniture and fixtures 1,193 1,144 19,828 16,123 Less accumulated depreciation (6,722 ) (3,809 ) $ 13,106 $ 12,314 Depreciation expense for the years ended December 31, 2020, 2019 and 2018 was $2.5 million, $1.2 million and $1.1 million, respectively. There have been no impairments recorded during the years ended December 31, 2020, 2019 and 2018. Under the terms of the Asset Purchase Agreement with Vesta entered into on November 7, 2019, the Company acquired $7.3 million of fixed assets, including leasehold improvements of $2.4 million, manufacturing equipment of $4.4 million, and capitalized software of $0.5 million. Refer further to Note 3. Accrued and other current liabilities consist of the following: December 31, December 31, 2020 2019 Payroll and related expenses $ 3,524 $ 6,789 Accrued severance 2,900 894 Accrued commissions 5,561 4,984 Accrued manufacturing 225 2,616 Deferred and contingent consideration, current portion 10,146 6,830 Audit, consulting and legal fees 48 630 Accrued sales and marketing expenses 445 1,109 Lease liabilities 1,588 1,299 Other 7,952 7,400 $ 32,389 $ 32,551 The following table provides a rollforward of the accrued warranties (in thousands): Year Ended December 31, 2020 2019 Balance as of January 1 $ 1,562 $ 1,395 Warranty costs incurred during the period (832 ) (762 ) Changes in accrual related to warranties issued during the period 1,200 1,138 Changes in accrual related to pre-existing warranties 71 (209 ) Balance as of December 31 $ 2,001 $ 1,562 As of December 31, 2020, $1.9 million is included in “Warranty reserve and other long-term liabilities”, and $0.1 million is included in “Accrued and other current liabilities”. As of December 31, 2019, $1.4 million is included in “Warranty reserve and other long-term liabilities”, and $0.2 million is included in “Accrued and other current liabilities”. Liabilities measured at fair value Common stock warrants 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 estimates its expected stock volatility based on company-specific historical and implied volatility information of its stock. 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. Contingent consideration The Company assessed the fair value of the contingent consideration for future royalty payments related to the acquisition of BIOCORNEUM and the contingent consideration for the future milestone payments related to the acquisition of miraDry using a Monte-Carlo simulation model. The contingent consideration related to the acquisition of BIOCORNEUM consists of royalty obligations based on future net sales for a defined term, beginning in 2024. The significant assumption utilized in the fair value measurement was the discount rate, which was 21.0%. The contingent consideration for future milestone payments related to the acquisition of miraDry is based on the timing of achievement of target net sales, which is estimated based on an internal management forecast. The significant assumption utilized in the fair value measurement was the miraDry company discount rate, which was 11.2%. As these inputs are not observable, the overall fair value measurement of the contingent consideration is classified as Level 3. Derivative liability The Company assesses on a quarterly basis the fair value of the derivative liability associated with the conversion feature in the convertible note due in 2025. The conversion feature was bifurcated and recorded as a derivative liability on the consolidated balance sheet with a corresponding discount at the date of issuance that is netted against the principal amount of the note. The Company utilizes a binomial lattice method to determine the fair value of the conversion feature, which utilizes inputs including the common stock price, volatility of common stock, the risk-free interest rate and the probability of conversion to common shares at the Base Conversion Rate in the event of a major transaction (e.g. a change in control). As the probability of conversion is a significant unobservable input, the overall fair value measurement of the conversion feature 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 December 31, 2020 and 2019 and indicate the level of the fair value hierarchy utilized to determine such fair value (in thousands): Fair Value Measurements as of December 31, 2020 Using: Level 1 Level 2 Level 3 Total Liabilities: Liability for common stock warrants $ — $ — $ — $ — Liability for contingent consideration — — 7,026 7,026 Liability for derivative — — 26,570 26,570 $ — $ — $ 33,596 $ 33,596 Fair Value Measurements as of December 31, 2019 Using: Level 1 Level 2 Level 3 Total Liabilities: Liability for common stock warrants $ — $ — $ 38 $ 38 Liability for contingent consideration — — 6,891 6,891 $ — $ — $ 6,929 $ 6,929 The following table provides a rollforward of the aggregate fair values of the Company’s liabilities for which fair value is determined by Level 3 inputs (in thousands): Warrant liability Contingent consideration liability Derivative liability Balance, December 31, 2019 $ 38 $ 6,891 $ — Additions — — 16,100 Change in fair value (38 ) 135 10,470 Balance, December 31, 2020 $ — $ 7,026 $ 26,570 The liability for the current portion of contingent consideration is included in “accrued and other current liabilities” and the long-term portion is included in “deferred and contingent consideration” in the consolidated balance sheets. The liability for the conversion feature related to the convertible note is included in “derivative liability” in the consolidated balance sheets. The Company recognizes changes in the fair value of the derivative liability in “change in fair value of derivative liability” in the consolidated statement of operations and changes in the contingent consideration are recognized in “general and administrative” expense in the consolidated statement of operations. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets, net | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets, net | (5) Goodwill and Other Intangible Assets, net (a) Goodwill The Company has determined that it has two reporting units, Breast Products and miraDry, and evaluates goodwill for impairment at least annually on October 1 st In the second quarter of 2019, the Company noted a decline in actual and forecasted earnings for the miraDry reporting unit in comparison to forecasted earnings determined in prior periods. Based on this evaluation, the Company determined that the carrying value of the miraDry reporting unit more likely than not exceeded its estimated fair value. As a result, the Company performed a quantitative analysis to compare the fair value of the reporting unit to its carrying amount. After performing the impairment test as of June 30, 2019 the Company determined that the carrying value of its miraDry reporting unit exceeded its estimated fair value using the income approach by an amount that indicated a full impairment of the carrying value of goodwill. Consequently, the Company recorded a non-cash goodwill impairment charge of $7.6 million during the second quarter ended June 30, 2019, which is reflected in the consolidated statement of operations for the year ended December 31, 2019. For the year ended December 31, 2018, the Company did not record any goodwill impairment charges. In the current year, the Company performed a qualitative analysis for the goodwill in the Breast Products reporting unit on the annual impairment testing date of October 1, 2020. The Company determined the fair value of the reporting unit was more likely than not greater than its carrying value and did not record any goodwill impairment charges. As of December 31, 2020, the Breast Products reporting unit had a negative carrying value. As of December 31, 2019 the miraDry reporting unit had a negative carrying value. The changes in the carrying amount of goodwill during the years ended December 31, 2020 and 2019 were as follows (in thousands): Breast Products miraDry Total Balances as of December 31, 2018 $ 19,156 $ 7,629 $ 26,785 Accumulated impairment losses (14,278 ) (7,629 ) (21,907 ) Goodwill acquired (Note 3) 4,324 — 4,324 Balances as of December 31, 2019 $ 9,202 $ — $ 9,202 Goodwill acquired — — — Balances as of December 31, 2020 $ 9,202 $ — $ 9,202 (b) Other Intangible Assets In connection with the circumstances leading to the impairment of goodwill for the miraDry reporting unit, in the second quarter of 2019 the Company performed a test of recoverability of the intangible assets in the miraDry reporting unit by comparing the carrying amount of the asset group to the future undiscounted cash flows the assets are expected to generate. As the future undiscounted cash flows attributable to the asset group were less than the carrying value, the Company performed a quantitative analysis to compare the fair value of the intangible assets in the reporting unit to their carrying amount. After performing a quantitative impairment analysis as of June 30, 2019, the Company determined that the carrying values of all of the intangible assets in the miraDry reporting unit exceeded their estimated fair values. Consequently, the Company recorded non-cash impairment charges of $0.4 million for customer relationships, $0.3 million for distributor relationships, $3.3 million for tradenames, and $1.0 million for developed technology during the second quarter ended June 30, 2019, which is reflected in “Impairment” in the consolidated statement of operations for the year ended December 31, 2019. For the year ended December 31, 2018, the Company did not record any goodwill impairment charges. Further, in the first quarter of 2020, the Company noted a decline in actual and forecasted earnings for the miraDry reporting unit due to the impacts and uncertainty surrounding the COVID-19 pandemic. As a result, the Company performed a test of recoverability and determined that the future undiscounted cash flows attributable to the asset group were less than the carrying value. After performing a quantitative impairment analysis as of March 31, 2020, the Company determined that the carrying values of all of the remaining intangible assets in the miraDry reporting unit exceeded their estimated fair values. Consequently, the Company recorded total non-cash impairment charges of $1.1 million for trade names, $1.4 million for developed technology, and $3.9 million for customer relationships within “Impairment” in the accompanying consolidated statement of operations for the year ended December 31, 2020. As of December 31, 2020, the remaining carrying value of the intangible assets are entirely associated with the Breast Products segment. For those assets, the Company performed a qualitative analysis on the annual impairment testing date of October 1, 2020. The Company determined the fair value of the intangible assets was more likely than not greater than its carrying value and did not record any impairment charges. The components of the Company’s other intangible assets consist of the following definite-lived and indefinite-lived assets (in thousands): Average Amortization December 31, 2020 Period Gross Carrying Accumulated Intangible (in years) Amount Amortization Assets, net Intangibles with definite lives Customer relationships 10 $ 4,940 $ (3,856 ) $ 1,084 Trade names - finite life 12 800 (322 ) 478 Non-compete agreement 2 80 (80 ) — Regulatory approvals 1 670 (670 ) — Acquired FDA non-gel product approval 11 1,713 (1,713 ) — Manufacturing know-how 19 8,240 (865 ) 7,375 Total definite-lived intangible assets $ 16,443 $ (7,506 ) $ 8,937 Intangibles with indefinite lives Trade names - indefinite life — 450 — 450 Total indefinite-lived intangible assets $ 450 $ — $ 450 Average Amortization December 31, 2019 Period Gross Carrying Accumulated Intangible (in years) Amount Amortization Assets, net Intangibles with definite lives Customer relationships 11 $ 9,540 $ (3,846 ) $ 5,694 Trade names - finite life 14 2,000 (292 ) 1,708 Developed technology 13 1,500 (84 ) 1,416 Non-compete agreement 2 80 (80 ) — Regulatory approvals 1 670 (670 ) — Acquired FDA non-gel product approval 11 1,713 (1,713 ) — Manufacturing know-how 19 8,240 (118 ) 8,122 Total definite-lived intangible assets $ 23,743 $ (6,803 ) $ 16,940 Intangibles with indefinite lives Trade names - indefinite life — 450 — 450 Total indefinite-lived intangible assets $ 450 $ — $ 450 Amortization expense for the year ended December 31, 2020, 2019 and 2018 was $1.6 million, $2.3 million and $2.3 million, respectively. The following table summarizes the estimated amortization expense relating to the Company's intangible assets as of December 31, 2020 (in thousands): Amortization Period Expense 2021 $ 1,221 2022 1,163 2023 1,092 2024 948 2025 805 Thereafter 3,708 $ 8,937 |
Leases
Leases | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
Leases | (6) Leases Components of lease expense were as follows: Year Ended December 31, Lease Cost Classification 2020 2019 Operating lease cost Operating expenses $ 1,698 $ 1,550 Operating lease cost Inventory 488 4,206 Total operating lease cost $ 2,186 $ 5,756 Finance lease cost Amortization of right-of-use assets Operating expenses 41 41 Amortization of right-of-use assets Inventory 36 — Interest on lease liabilities Other income (expense), net 10 4 Total finance lease cost $ 87 $ 45 Variable lease cost Inventory — 10,568 Total lease cost $ 2,273 $ 16,369 Short-term lease expense for the years ended December 31, 2020 and 2019 were immaterial. Supplemental cash flow information related to operating and finance leases was as follows (in thousands): Year Ended December 31, 2020 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash outflows from operating leases $ 1,758 $ 5,419 Operating cash outflows from finance leases 85 44 Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 1,242 $ 8,667 Finance leases 157 117 Supplemental balance sheet information related to operating and finance leases was as follows (in thousands, except lease term and discount rate): December 31, December 31, 2020 2019 Reported as: Other assets Operating lease right-of-use assets $ 7,176 $ 7,494 Finance lease right-of-use assets 158 78 Total right-of use assets $ 7,334 $ 7,572 Accrued and other current liabilities Operating lease liabilities $ 1,504 $ 1,259 Finance lease liabilities 84 40 Warranty reserve and other long-term liabilities Operating lease liabilities 5,946 6,434 Finance lease liabilities 77 35 Total lease liabilities $ 7,611 $ 7,768 Weighted average remaining lease term (years) Operating leases 5 5 Finance leases 2 2 Weighted average discount rate Operating leases 7.75 % 7.45 % Finance leases 6.15 % 4.06 % During the fourth quarter of 2019, the Company included a four-year As of December 31, 2020, maturities of the Company’s operating and finance lease liabilities are as follows (in thousands): Period Operating leases Finance leases Total 2021 $ 2,095 $ 89 $ 2,184 2022 1,920 53 1,973 2023 1,968 28 1,996 2024 1,507 1 1,508 2025 579 — 579 2026 and thereafter 955 — 955 Total lease payments $ 9,024 $ 171 $ 9,195 Less imputed interest 1,574 10 1,584 Total operating lease liabilities $ 7,450 $ 161 $ 7,611 |
Debt
Debt | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Debt | (7) Debt Term Loan and Revolving Loan On July 25, 2017, the Company entered into a Term Loan Credit and Security Agreement and a Revolving Loan Credit and Security Agreement with MidCap Financial Trust (“MidCap”), which replaced the Company’s prior Silicon Valley Bank Loan Agreement. Both agreements were amended and restated on July 1, 2019 and further amended on November 7, 2019 (as so amended, the “Restated Term Loan Agreement” and the “Restated Revolving Credit Agreement” and, together, the “Credit Agreements”). The Restated Term Loan Agreement provided for the following tranches: (i) a $35 million term loan facility drawn at signing, (ii) a $5 million term loan facility drawn at signing, (iii) at any time after September 30, 2020 to December 31, 2020, a $ 10.0 million term loan facility (subject to the satisfaction of certain conditions, including evidence that the Company’s net revenue for the past 12 months was greater than or equal to $ 100.0 million), and (iv) until December 31, 2020 and upon the consent of the agent and the lenders following a request from the Company, an additional $ 15.0 million term loan facility. The loan matures on July 1, 2024 and carries an interest rate of LIBOR plus 7.50 %. The Company will make monthly payments of accrued interest from the funding date until July 31, 2021, to be followed by monthly installments of principal and interest through the maturity date. The Company may prepay some or all of the principal prior to its maturity date provided the Company pays MidCap a prepayment fee. The loan provide d that the Company shall pay an exit fee equal to 5.0 % of the aggregate amount of all term loans funded to the Company . On May 11, 2020, the Company entered into the Second Amendment to Amended and Restated Credit and Security Agreement (Term Loan), by and among the Company, certain of the Company’s subsidiaries, the lenders party thereto and MidCap Financial Trust as agent (the “Term Amendment”). The Term Amendment provided for, among other things, the prepayment by the Company of $25.0 million of outstanding principal, $0.1 million of accrued interest, and $1.25 million in prepaid exit fees with the parties agreeing to waive the prepayment fee with respect to these amounts. The Term Amendment increased the tranche 3 commitment amount from $10.0 million to $15.0 million, extended the tranche 3 termination date from December 31, 2020 to June 30, 2021, and amended certain conditions upon which the tranche 3 commitment can be withdrawn, including evidence that the Company’s net revenue for the past six months was greater than or equal to $30.0 million. In addition, the Term Amendment amended certain financial requirements including reducing the Company’s minimum unrestricted cash amount from $20.0 million to $5.0 million and amended certain minimum net revenue requirements. Further, the monthly minimum net revenue requirements were revised to be calculated on a trailing three-month basis. On February 5, 2021, the Company entered into a Second Amended and Restated Credit and Security Agreement (Term Loan), by and among the Company, certain of the Company’s subsidiaries, the lenders party thereto from time to time and MidCap Financial Trust, as administrative agent and collateral agent (“Agent”) (the “Restated Term Loan Agreement”). The Restated Term Loan Agreement amends and restates the Company’s existing Amended and Restated Credit and Security Agreement, dated as of July 1, 2019. Pursuant to the Restated Term Loan Agreement, tranche 3 commitments were reduced from $15 million to $1 million and were advanced on the effective date of the Restated Term Loan Agreement and the remaining unfunded tranche of $15 million was revised to two $5 million tranche commitments, with tranche 4 availability commencing on July 1, 2021 and tranche 5 availability commencing July 1, 2022. The parties agreed to extend the last day of the interest only period for all tranches from July 31, 2021 in the Existing Term Loan Agreement to December 31, 2022 in the Restated Term Loan Agreement. The Restated Term Loan Agreement contains certain minimum net revenue requirements based on the Company’s 12-month trailing net revenue, as well as certain minimum unrestricted cash requirements that increase upon the funding of the tranche 4 and tranche 5 loans. The exit fee was modified to apply to only to the amount of any tranche 4 and 5 loans advanced. Finally, in connection with the Restated Term Loan Agreement, the Company agreed to pay an amendment fee of $750,000. As of December 31, 2020, there was $15.0 million of outstanding principal. $12.9 million is included in “Long-term debt” and $2.1 million is included in “Current portion of long-term debt” on the consolidated balance sheets. $0.9 million of unamortized debt issuance costs is included in “Long-term debt”, and $0.7 million of unamortized debt issuance costs is included in “Current portion of long-term debt”. In addition, an exit fee payable of $0.8 million is also included in “Long-term debt”. The Restated Revolving Credit Agreement provides for, among other things, a revolving loan of up to $10.0 million. The amount of loans available to be drawn under the Revolving Credit Agreement is based on a borrowing base equal to 85% of the net collectible value of eligible accounts receivable plus 40% of eligible finished goods inventory, or the Borrowing Base, provided that availability from eligible finished goods inventory does not exceed 20% of the Borrowing Base. The revolving loan carries an interest rate of LIBOR plus 4.50%. The Company may make (subject to the applicable borrowing base at the time) and repay borrowings from time to time until the maturity of the facility on July 1, 2024. On May 11, 2020, the Company entered into the Second Amendment to Amended and Restated Credit and Security Agreement (Revolving Loan), by and among the Company, certain of the Company’s subsidiaries, the lenders party thereto and MidCap Financial Trust as agent (the “Revolving Amendment”). The Revolving Amendment includes conforming changes to reflect the changes in the Term Amendment. In addition, the Revolving Amendment reduces the borrowing base by the portion of the eligible inventory previously included in the calculation. Also on February 5, 2021, Sientra entered into a Third Amendment to Amended and Restated Credit and Security Agreement (Revolving Loan), by and among the Company, the lenders party thereto from time to time, and the Agent (the “Revolving Loan Amendment”). The Revolving Loan Amendment modified the Net Revenue requirement in a manner consistent with the modification under the Restated Term Loan Agreement. In addition, the Revolving Loan Amendment made other conforming changes to the Restated Term Loan Agreement. As of December 31, 2020, there were no borrowings outstanding and $2.9 million available under the Revolving Loan. As of December 31, 2020, the unamortized debt issuance costs related to the Revolving Loan was approximately $0.1 million and was included in “Other assets” on the consolidated balance sheets. The amortization of debt issuance costs on the Term Loan and Revolving Loan for the years ended December 31, 2020, 2019, and 2018 was $0.9 million, $0.4 million, and $0.2 million, respectively, and was included in interest expense in the consolidated statements of operations. The Credit Agreements include 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. Convertible Note On March 11, 2020, the Company issued $60.0 million of unsecured and subordinated convertible notes with an interest rate of 4.00% (“Note”) to Deerfield Partners, L.P.(“Holder”) in order to fund ongoing operations. The Note matures on March 11, 2025, subject to earlier conversion by the option of the Holder at any time in whole or in part into common shares of the Company, for a period up to five years. Upon conversion by the Holder, the Company shall deliver, shares of the Company’s common stock at a conversion rate of 14,634 per $1,000 principal amount of the Note (which represents an initial conversion rate price of $4.10), or the Base Conversion Rate, in each case subject to customary anti-dilution adjustments. In addition to the typical anti-dilution adjustment, the Note also provides the Holder with additional consideration (“Make-Whole Provision”) beyond the settlement of the conversion obligation, in the event of a major transaction prior to maturity (e.g. a change in control). Upon conversion by the Holder in the event of a major transaction, the Company shall deliver, either cash, shares of the Company’s common stock or a combination of cash and common stock at the Base Conversion rate plus the additional consideration from the Make-Whole Provision. The $60.0 million principal amount of the Note is not payable until the maturity date of March 11, 2025, unless converted to equity earlier. The Company will pay interest in cash on the Note at 4.00% per annum, quarterly from July 1, 2020. The Convertible Note is convertible at any time at the option of Deerfield, provided that Deerfield is prohibited from converting the Convertible Note into shares of Common Stock if, as a result of such conversion, the Holder (together with certain affiliates and “group” members) would beneficially own more than 4.985% of the total number of shares of Common Stock then issued and outstanding. Pursuant to the Convertible Note, Deerfield has the option to demand repayment of all outstanding principal, and any unpaid interest accrued thereon, in connection with a Major Transaction (as defined in the Convertible Note), which shall include, among others, any acquisition or other change of control of the Company; the sale or transfer of assets of the Company equal to more than 50% of the Enterprise Value (as defined in the Convertible Note) of the Company; a liquidation, bankruptcy or other dissolution of the Company; or if at any time shares of the Company’s common stock are not listed on an Eligible Market (as defined in the Convertible Note). The Convertible Note is subject to specified events of default, the occurrence of which would entitle Deerfield to immediately demand repayment of all outstanding principal and accrued interest on the Convertible Note. Such events of default include, among others, failure to make any payment under the Convertible Note when due, failure to observe or perform any covenant under the Deerfield Facility Agreement or the other transaction documents related thereto (subject to a standard cure period), the failure of the Company to be able to pay debts as they come due, the commencement of bankruptcy or insolvency proceedings against the Company, a material judgement levied against the Company and a material default by the Company under the Convertible Note. The conversion features in the outstanding convertible debt instrument are accounted for as a free-standing embedded derivative bifurcated from the principal balance of the Note, as (1) the conversion features are not clearly and closely related to the debt instrument and are not considered to be indexed to the Company’s equity, (2) the conversion features standing alone meet the definition of a derivative, and (3) the Note is not remeasured at fair value each reporting period with changes in fair value recorded in the consolidated statement of operations. The initial embedded derivative liability of $16.1 million was recorded as a non-current liability on the consolidated balance sheet and is remeasured to fair value at each balance sheet date with a resulting non-cash gain or loss related to the change in the fair value being charged to earnings (loss). As of December 31, 2020, the fair value of the derivative liability was $26.6 million. A corresponding debt discount to the initial embedded derivative liability of $16.1 million and issuance costs of $1.5 million were recorded on the issuance date and is netted against the principal amount of the Note. As of December 31, 2020, the unamortized debt discount and issuance costs were $15.6 million. The Company will amortize the debt discount and debt issuance costs to interest expense under the effective interest method over the term of the Note, at a resulting effective interest rate of approximately 12%. For the year ended December 31, 2020, the amortization of the convertible debt discount and issuance costs were $2.2 million and were included in interest expense in the consolidated statements of operations. In connection with the Deerfield Financing, the Company also entered into a Subordination Agreement, by and among Deerfield, the Company, MiraDry Holdings, Inc., MiraDry, Inc. and MiraDry International, Inc. and MidCap Funding IV Trust, pursuant to which the parties thereto agreed that the obligations of the Company to Deerfield under the Deerfield Facility Agreement and under the Convertible Note shall be subordinate to the Company’s obligations to MidCap Funding IV Trust, as agent for the financial institutions party to that certain Amended and Restated Credit and Security Agreement (Revolving Loan) dated as of July 1, 2019, which agreement the Company, MiraDry Holdings, Inc., MiraDry, Inc. and MiraDry International, Inc. and MidCap Funding IV Trust are a party to. Registration Rights Agreement In connection with the Deerfield Facility Agreement, on March 11, 2020, the Company and Deerfield entered into a Registration Rights Agreement (the “Registration Rights Agreement”). Pursuant to the Registration Rights Agreement, the Company filed with the SEC a Registration Statement on Form S-3 as required to effect a registration of the Common Stock issued or issuable upon conversion of or pursuant to the Convertible Note (the “Registrable Securities”), covering the resale of the Registrable Securities and such indeterminate number of additional shares of Common Stock as may become issuable upon conversion of or otherwise pursuant to the Convertible Note to prevent dilution resulting from certain corporate actions. CARES Act On April 20, 2020, the Company was granted a loan of $6.7 million under the Paycheck Protection Program of the CARES Act, or the PPP Loan, from Silicon Valley Bank, or the Lender. The PPP Loan matures on April 20, 2022, or the Maturity Date, and bears interest at a rate of 1.0% per annum. Under the terms of the PPP Loan, the Company will make no payments until the date which forgiveness of the PPP Loan is determined, which can be up to 10 months following the end of the covered period (which is defined as 24 weeks from the date of the loan), or the Deferral Period. Commencing one month after the expiration of the Deferral Period, and continuing on the same day of each month until the Maturity Date, the Company will pay to Lender monthly payments of principal and interest, in an amount required to fully amortize the principal amount outstanding on the PPP Loan on the last day of the Deferral Period by the Maturity Date. As of December 31, 2020, $3.3 million is recorded in “Long-term debt” and $3.3 million is recorded in “Current portion of long-term debt” on the Company’s consolidated balance sheets. All or a portion of the PPP Loan may be forgiven upon submission of documentation of expenditures in accordance with certain specified requirements. Under the CARES Act, loan forgiveness is available for the sum of documented payroll costs, covered rent payments, covered mortgage interest and covered utilities during the 24-week period beginning on the date of loan approval. Not more than 40% of the forgiven amount may be for non-payroll costs. The amount of the PPP Loan eligible to be forgiven will be reduced if the Company’s full-time headcount declines, or if salaries and wages for employees with salaries of $100,000 or less annually are reduced by more than 25%. The Company will be required to repay any portion of the outstanding principal that is not forgiven, along with accrued interest, in accordance with the amortization schedule described above. The Company has elected to account for the PPP loan in accordance with ASC 470 – Debt, and any forgiveness of the loan will be treated as a gain on extinguishment within the consolidated statement of operations. Future Principal Payments of Debt The future schedule of principal and exit fee payments for all outstanding debt as of December 31, 2020 was as follows (in thousands): Fiscal Year 2021 $ 5,409 2022 8,326 2023 5,000 2024 3,667 2025 60,000 Total $ 82,402 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | (8) Income Taxes The provision for income tax consists of the following: Year Ended December 31, 2020 2019 2018 Federal $ 12 $ 9 $ 2 State 10 9 (10 ) Foreign 11 16 4 Total income tax (benefit) expense $ 33 $ 34 $ (4 ) Actual income tax expense differs from that obtained by applying the statutory federal income tax rate of 21% in 2020, 2019, and 2018, respectively, to income before income taxes as follows: (in thousands): Year Ended December 31, 2020 2019 2018 Tax at federal statutory rate $ (18,882 ) $ (22,424 ) $ (17,353 ) State, net of federal benefit (2,372 ) (2,109 ) (5,999 ) Permanent items 2,282 857 338 Benefit state rate change 20 337 60 Other 2,984 368 (103 ) Goodwill impairment — 1,602 — Change in valuation allowance 16,001 21,403 23,053 $ 33 $ 34 $ (4 ) The tax effects of temporary differences and carryforwards that give rise to significant portions of the deferred tax assets and liabilities are as follows (in thousands): December 31, 2020 2019 Net operating loss carryforwards $ 113,374 $ 99,759 Research and development credits 2,121 3,626 Lease liabilities 1,861 1,902 Derivative liability 6,495 — Accruals and reserves 10,175 9,636 Intangibles 3,053 5,330 137,079 120,253 Less valuation allowance (131,309 ) (115,307 ) Total deferred tax assets $ 5,770 $ 4,946 Depreciation $ (276 ) $ (40 ) Convertible debt discount (3,440 ) — Right-of-use assets (1,793 ) (1,854 ) Intangibles - deferred tax liability (333 ) (3,102 ) Total deferred tax liabilities (5,842 ) (4,996 ) Net deferred taxes $ (72 ) $ (50 ) In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. Generally, the ultimate realization of deferred tax assets is dependent on the generation of future taxable income during the periods in which those temporary differences become deductible. Based on all the relevant factors, a valuation allowance of $131.3 million has been established against deferred tax assets as of December 31, 2020 as management determined that it is more likely than not that sufficient taxable income will not be generated to realize these temporary differences. As of December 31, 2020, the Company had net operating loss carryforwards for federal income tax purposes of approximately $445.1 million, of which approximately $217.4 million can be carried forward indefinitely and the remaining net operating loss carryforwards begin expiring in 2027, if not utilized. In addition, the Company had net operating loss carryforwards for state income tax purposes of approximately $306.2 million, of which approximately $26.2 million can be carried forward indefinitely and the remaining net operating loss carryforwards began expiring in 2021. It is possible that the Company will not generate taxable income in time to use these NOLs before their expiration. In addition, under Section 382 of the Internal Revenue Code of 1986, as amended, or the Code, if a corporation undergoes an “ownership change ”, the corporation's ability to use its pre-change NOL carryforwards and other pre-change tax attributes to offset its post-change income may be limited. In general, an “ownership change” occurs if there is a cumulative change in a loss corporation’s ownership by 5% shareholders that exceeds 50 percentage points over a rolling three-year period. As of December 31, 2020, the Company had research and development credit carryforwards of approximately $30,000 and $2.7 million available to reduce future taxable income, income, if any, for federal and California state income tax purposes, respectively. The federal credit carryforwards begin expiring in 2029 and the state credits carryforward indefinitely. At December 31, 2020, the Company had unrecognized tax benefits of approximately $0.6 million associated with the research and development credits. The decrease in the unrecognized tax benefits of $0.5 million relates to the elimination of federal R&D credit carryforwards that cannot be used due to ownership changes that were reported during 2020. The decrease in the unrecognized tax benefits has no impact on the Company’s financial statements due to the valuation allowance on deferred tax assets. The Company does not anticipate that total unrecognized net tax benefits will significantly change over the next twelve months. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in thousands): Ending balance at December 31, 2018 $ 1,076 Additions based on tax positions taken in the current year 40 Ending balance at December 31, 2019 1,116 Additions based on tax positions taken in the current year 10 Decreases based on tax positions taken in the prior year (507 ) Ending balance at December 31, 2020 $ 619 It is the Company’s policy to include penalties and interest expense related to income taxes as a component of other (income) expense and interest expense, respectively, as necessary. There was no interest expense or penalties related to unrecognized tax benefits recorded through December 31, 2020. The Company files U.S. federal and state income tax returns in jurisdictions with varying statute of limitations. In general, the Company’s federal tax returns for 2017 to 2019 and state tax returns for 2016 to 2019 remain open for examination by the federal and state tax authorities, including net operating loss carryforwards to those years. |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Dec. 31, 2020 | |
Compensation And Retirement Disclosure [Abstract] | |
Employee Benefit Plans | (9) Employee Benefit Plans In September 2016, the Company adopted a Section 401(k) Retirement Savings Plan for the benefit of eligible employees. All employees become eligible to participate in the plan the first of the month following their hire date and may contribute their pretax or after–tax salary, up to the Internal Revenue Service annual contribution limit. The Company makes contributions to the 401(k) plan under a safe harbor provision, whereby the Company contributes 3% of each participating employee’s annual compensation. The Company contributions vest immediately. The Company contributed and included in operating expense $0.7 |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2020 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stockholders' Equity | (10) (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 December 31, 2020, 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 the 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 seven-year (c) Stock Option Plans In April 2007, the Company adopted the 2007 Equity Incentive Plan, or 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 reserved for issuance under the 2007 Plan. As of December 31, 2020, pursuant to the 2007 Plan, there were 269,295 options outstanding and no shares of common stock available for future grants. 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 December 31, 2020, pursuant to the 2014 Plan, there were 6,692,279 shares of common stock reserved and 299,947 shares of common stock available for future grants. Pursuant to a board-approved Inducement Plan, the Company may issue NSOs and restricted stock unit awards 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 December 31, 2020, inducement grants for 1,476,106 shares of common stock have been awarded, and 937,591 shares of common stock were reserved 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 be not 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, 2018 1,953,334 $ 7.42 6.30 Exercised (51,451 ) 2.44 Forfeited (21,037 ) 19.39 Balances at December 31, 2019 1,880,846 $ 7.42 5.48 Granted 600,000 3.58 Exercised (9,817 ) 2.89 Forfeited (511,528 ) 8.87 Balances at December 31, 2020 1,959,501 $ 4.79 5.92 Vested and expected to vest at December 31, 2020 1,959,501 Vested and exercisable at December 31, 2020 1,359,558 8.53 The weighted average grant date fair value of stock options granted to employees and directors during the year ended December 31, 2020 was $3.58 per share. There were no stock options granted during the years ended December 31, 2019 and 2018. Stock-based compensation expense for stock options for the years ended December 31, 2020, 2019 and 2018 was $0.1 million, $0.6 million and $1.6 million, respectively. Tax benefits arising from the disposition of certain shares issued upon exercise of stock options within two years of the date of grant or within one year of the date of exercise by the option holder, or Disqualifying Dispositions, provide the Company with a tax deduction equal to the difference between the exercise price and the fair market value of the stock on the date of exercise. As of December 31, 2020 there was $2.1 million of unrecognized compensation cost related to stock options granted under the plans. The expense is recorded within the operating expense components in the consolidated statement of operations based on the employees receiving the awards. The aggregate intrinsic value of stock options is calculated as the difference between the exercise price of the stock options and the fair value of the Company’s common stock for those stock options that had exercise prices lower than the fair value of the Company’s common stock. The aggregate intrinsic value of stock options exercised was $14,000, $0.6 million, and $2.0 million during the years ended December 31, 2020, 2019 and 2018, respectively. The following table presents the weighted‑average assumptions used to estimate the fair value of options granted during the periods presented: Year Ended December 31, Stock Options 2020 2019 2018 Expected term (in years) 6.50 — — Expected volatility 82.65% — — Risk-free interest rate 0.27% — — Dividend yield — — — The expected term of employee stock options, risk‑free interest rate and volatility represents the weighted average, based on grant date period which the stock options are expected to remain outstanding. The Company utilizes the simplified method to estimate the expected term of the options pursuant to ASC Subtopic 718‑10 for all option grants to employees. The Company estimates its expected stock volatility based on company-specific historical and implied volatility information of its stock. The risk‑free interest rate is based on the U.S. Treasury yield curve in effect at the time of the grant for periods corresponding with the expected term of the option. The dividend yield assumption is based on the Company’s history and expectation of dividend payouts. The Company has never declared or paid any cash dividends on its common stock, and the Company does not anticipate paying any cash dividends in the foreseeable future. The Company records forfeitures when they occur. For purposes of financial accounting for stock‑based compensation, the Company has determined the fair values of its options based in part on the work of a third‑party valuation specialist. The determination of stock‑based compensation is inherently uncertain and subjective and involves the application of valuation models and assumptions requiring the use of judgment. If the Company had made different assumptions, its stock‑based compensation expense, and its net loss could have been significantly different. (d) Restricted Stock Units The Company has issued restricted stock unit awards, or RSUs, to employees and non-employees under the 2014 Plan and Inducement Plan. The RSUs issued to employees generally vest on a straight-line basis annually over a 3-year requisite service period. The RSUs issued to non-employees are generally for consulting services and 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, 2018 2,141,350 $ 13.27 Granted 1,407,768 8.02 Vested (944,467 ) 10.56 Forfeited (371,695 ) 7.99 Balances at December 31, 2019 2,232,956 $ 11.99 Granted 3,070,430 4.77 Vested (1,150,707 ) 10.06 Forfeited (1,058,889 ) 7.82 Balances at December 31, 2020 3,093,790 $ 6.97 The weighted average grant date fair value of RSUs granted to employees and directors during the years ended December 31, 2020, 2019 and 2018 was $4.77, $8.02, and $14.38 per share, respectively. Stock-based compensation expense for RSUs for the years ended December 31, 2020, 2019 and 2018 was $7.5 million, $11.3 million and $11.7 million, respectively. As of December 31, 2020, there was $11.5 million total unrecognized compensation cost related to non-vested RSU awards. The cost is expected to be recognized over a weighted average period of 1.88 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 offering periods not to exceed 27 months, and each offering period will include purchase periods, which will be the approximately six-month As of December 31, 2020, the number of shares of common stock reserved for issuance under the ESPP was 1,746,258. During the year ended December 31, 2020, employees purchased 203,728 shares under the ESPP at a weighted average exercise price of $4.11 per share. During the year ended December 31, 2019, employees purchased 175,624 shares under the ESPP at a weighted average exercise price of $6.93 per share. As of December 31, 2020, the number of shares of common stock available for future issuance under the ESPP was 946,292. Stock-based compensation related to the ESPP for the years ended December 31, 2020, 2019 and 2018 was $0.6 million, $0.8 million, and $0.6 million, respectively. The following table presents the weighted-average assumptions used to estimate the fair value of the stock purchase rights granted under the employee stock purchase plan: Year Ended December 31, ESPP 2020 2019 2018 Expected term (in years) 0.50 to 2.00 0.50 to 2.00 0.50 to 2.00 Expected volatility 68 % to 139 % 69 % to 77 % 36 % to 42 % Risk-free interest rate 0.14 % to 1.57 % 1.87 % to 2.06 % 1.27 % to 3.03 % Dividend yield — — — (f) Significant modifications There were no material modifications of equity awards during the years ended December 31, 2020, 2019, and 2018. |
Segment Reporting and Geographi
Segment Reporting and Geographic Information | 12 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
Segment Reporting and Geographic Information | (11) (a) 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, which was acquired in 2017, includes 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 November 7, 2019, the Company acquired Vesta. See Note 3 – Acquisitions for additional details. Vesta has been included in the consolidated results of operations as of the acquisition date and financial performance of the acquired business is reported in the Breast Products segment. 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): Year Ended December 31, 2020 2019 2018 Net sales Breast Products $ 54,997 $ 46,363 $ 37,016 miraDry 16,244 37,336 31,110 Total net sales $ 71,241 $ 83,699 $ 68,126 Year Ended December 31, 2020 2019 2018 Loss from operations Breast Products $ (46,521 ) $ (50,175 ) $ (53,047 ) miraDry (23,789 ) (53,392 ) (26,727 ) Total loss from operations $ (70,310 ) $ (103,567 ) $ (79,774 ) December 31, December 31, 2020 2019 Assets Breast Products $ 151,059 $ 169,613 miraDry 17,919 34,791 Total assets $ 168,978 $ 204,404 (b) Geographic Information Net sales are attributed to geographic areas based on where the Company’s products are shipped. The following table presents the net sales by geographical region for the periods presented (in thousands): Year Ended December 31, 2020 2019 2018 United States $ 58,752 $ 62,277 $ 49,975 International 12,489 21,422 18,151 Total net sales $ 71,241 $ 83,699 $ 68,126 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2020 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | (12) Commitments and Contingencies The Company is subject to claims and assessments 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. 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. Following a hearing, the Delaware Chancery Court approved the proposed settlement terms on January 15, 2019, with a modification to the amount of attorneys’ fees awarded to the plaintiffs’ attorneys. Under the terms of the settlement, in exchange for a full and final settlement and release of all claims, the Defendants (and/or their indemnitors and/or insurers) paid 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. The holdback amount has been used to offset $0.6 million of legal fees and $0.4 million was included in “legal settlement payable” on the consolidated balance sheet as of December 31, 2018. The legal settlement of $0.4 million was paid during the first quarter of 2019. Product Liability Litigation On October 7, 2019, a lawsuit was filed in the Superior Court of the State of California against the Company and Silimed Industria de Implantes Ltda. (the Company’s former contract manufacturer). The lawsuit alleges that the Company’s textured breast implants caused certain of the plaintiffs to develop a condition known as breast implant associated anaplastic large cell lymphoma (“BIA-ALCL”), and that the Company is liable to the Plaintiffs based on claims for strict liability (failure to warn), strict liability (defective manufacture), negligence and loss of consortium. The Company intends to vigorously defend itself in this lawsuit. Given the nature of this case, the Company is unable to estimate the reasonably possible loss or range of loss, if any, arising from this matter. On September 23, 2020, a lawsuit was filed in the Eastern District of Tennessee against the Company. The lawsuit alleges that the Company’s textured breast implants caused certain of the plaintiffs to develop a condition known as breast implant associated anaplastic large cell lymphoma (“BIA-ALCL”), and that the Company is liable to the plaintiffs based on claims for negligence, strict liability (manufacturing defects), strict liability (failure to warn), breach of express and implied warranties, and punitive damages. No response has been filed to the complaint at presented. The Company intends to vigorously defend itself in this lawsuit. Given the nature of this case, the Company is unable to estimate the reasonably possible loss or range of loss, if any, arising from this matter. |
Summary of Quarterly Financial
Summary of Quarterly Financial Information (Unaudited) | 12 Months Ended |
Dec. 31, 2020 | |
Selected Quarterly Financial Information [Abstract] | |
Summary of Quarterly Financial Information (Unaudited) | (13) Summary of Quarterly Financial Information (Unaudited) The following tables set forth our unaudited quarterly statements of operations data and our key metrics for each of the eight quarters ended December 31, 2020. We have prepared the quarterly data on a consistent basis with the audited financial statements included in this report. In the opinion of management, the financial information reflects all necessary adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of this data. This information should be read in conjunction with the audited financial statements and related notes included elsewhere in this report. The results of historical periods are not necessarily indicative of the results of operations for a full year or any future period. Quarter Ended 2020 March 31 June 30 September 30 December 31 (in thousands, except share data) Net sales $ 16,932 $ 12,448 $ 19,217 $ 22,644 Gross profit 10,140 6,898 10,826 11,075 Net loss (28,612 ) (34,277 ) (5,821 ) (21,237 ) Net loss per share: Basic and diluted $ (0.57 ) $ (0.68 ) $ (0.12 ) $ (0.42 ) Quarter Ended 2019 March 31 June 30 September 30 December 31 (in thousands, except share data) Net sales $ 17,552 $ 20,525 $ 22,412 $ 23,210 Gross profit 11,078 12,712 12,658 14,239 Net loss (26,484 ) (37,654 ) (22,433 ) (20,247 ) Net loss per share: Basic and diluted $ (0.91 ) $ (1.10 ) $ (0.45 ) $ (0.41 ) |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | (14) Subsequent Events Debt amendment On February 5, 2021, the Company entered into a Second Amended and Restated Credit and Security Agreement (Term Loan), by and among the Company, certain of the Company’s wholly-owned subsidiaries (together with Sientra, the “Borrowers”), the lenders party thereto from time to time and MidCap Financial Trust, as administrative agent and collateral agent (“Agent”) (the “Restated Term Loan Agreement”). The Restated Term Loan Agreement amends and restates the Company’s existing Amended and Restated Credit and Security Agreement (Term Loan), dated as of July 1, 2019. Refer to Note 7 – Debt for further details. Also on February 5, 2021, the Company entered in to a Third Amendment to Amended and Restated Credit and Security Agreement (Revolving Loan), by and among the Borrowers, the lenders party thereto from time to time, and the Agent (the “Revolving Loan Amendment”). The Revolving Loan Amendment modified the Net Revenue (as defined therein) requirement in a manner consistent with the modification under the Restated Term Loan Agreement. In addition, the Revolving Loan Amendment made other conforming changes to the Restated Term Loan Agreement. Refer to Note 7 – Debt for further details. Follow-on public offering On February 8, 2021, the Company completed a follow on public offering of 5,410,628 shares of common stock at $6.75 per share, as well as 811,594 additional shares of common stock pursuant to the full exercise of the over-allotment option granted to the underwriters. Net proceeds were approximately $39.1 million after deducting underwriting discounts and commissions of approximately $2.2 million and offering expenses of approximately $0.4 million. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Use of Estimates | (a) Basis of Presentation and Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America, or GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the dates of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Assets and liabilities which are subject to significant judgment and use of estimates include the allowance for doubtful accounts, sales return liability, provision for warranties, valuation of inventories, recoverability of long-lived assets, valuation allowances with respect to deferred tax assets, useful lives associated with property and equipment and finite lived intangible assets, and the valuation and assumptions underlying stock-based compensation and other equity instruments. On an ongoing basis, the Company evaluates its estimates compared to historical experience and trends, which form the basis for making judgments about the carrying value of assets and liabilities. In addition, the Company engages the assistance of valuation specialists in concluding on fair value measurements in connection with stock-based compensation and other equity instruments. |
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 decrease with the change in the miraDry business strategy, but 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 and the convertible note, sales of products since 2012, and the proceeds from the sale of common stock in public offerings. To fund ongoing operating and capital needs, the Company may need to raise additional capital in the future through the sale of equity securities and incremental debt financing. Debt financing On July 25, 2017, the Company entered into the Existing Credit Agreements with Midcap. On July 1, 2019, the Company entered into certain credit agreements with Midcap Financial Trust pursuant to which the Company repaid their existing indebtedness under the Existing Credit Agreements and the outstanding commitment fee was cancelled. Further, on May 11, 2020 and February 5, 2021, the Company amended certain credit agreements with Midcap Financial Trust. On March 11, 2020, the Company entered into a facility agreement with Deerfield Partners, L.P., issuing $60.0 million in principal amount of 4.0% unsecured and subordinated convertible notes upon the terms and conditions set forth in the facility agreement. In April 2020, the Company was granted a loan of $6.7 million under the Paycheck Protection Program of the CARES Act, or the PPP Loan, all or a portion of which may be forgiven dependent on the use of proceeds. The PPP Loan matures on April 20, 2022 and bears interest at a rate of 1.0% per annum. All or a portion of the PPP Loan may be forgiven upon submission of documentation of expenditures in accordance with certain specified requirements. The Company sought and obtained the PPP Loan due to the immediate and continued impact of the COVID-19 pandemic on revenues and prospects. The PPP Loan has allowed the Company to satisfy payroll obligations without a material reduction in pay for employees or a material headcount reduction, other than the reductions in the previously announced organizational efficiency initiative. See Note 7 to the consolidated financial statements for a full description of our long-term debt, revolving line of credit, convertible note, and PPP loan. Equity financing 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 its common stock having an aggregate gross offering price of up to $50.0 million. As of December 31, 2020, the Company has sold 37,000 shares of its common stock pursuant to the sales agreement. On May 7, 2018, the Company completed an underwritten follow-on public offering in which the Company sold 7,407,408 shares of common stock at $13.50 per share, as well as 1,111,111 additional shares of common stock pursuant to the full exercise of the over-allotment option granted to the underwriters. Net proceeds were approximately $107.6 million after deducting underwriting discounts and commissions of $6.9 million and offering expenses of approximately $0.5 million. Further, on June 7, 2019, the Company completed an underwritten follow-on public offering of 17,391,305 shares of common stock at $5.75 per share, as well as 2,608,695 additional shares of common stock pursuant to the full exercise of the over-allotment option granted to the underwriters. Net proceeds were approximately $107.7 million after deducting underwriting discounts and commissions of $6.9 million and offering expenses of approximately $0.4 million. At December 31, 2020, the Company had cash and cash equivalents of $55.0 million. The accompanying 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. The Company believes that its cash and cash equivalents will be sufficient to fund its operations for at least the next 12 months. |
Cash and Cash Equivalents | (c) Cash and Cash Equivalents The Company considers all highly liquid investments purchased with an original maturity of three months or less when purchased to be cash equivalents. Cash and cash equivalents consist primarily of cash in checking accounts and interest-bearing money market accounts. |
Concentration of Credit and Supplier Risks | (d) Concentration of Credit and Supplier Risks Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash and cash equivalents. The Company’s cash and cash equivalents are deposited in demand accounts at financial institutions that management believes are creditworthy. The Company is exposed to credit risk in the event of default by these financial institutions for cash and cash equivalents in excess of amounts insured by the Federal Deposit Insurance Corporation, or FDIC. Management believes that the Company’s investments in cash and cash equivalents are financially sound and have minimal credit risk and the Company has not experienced any losses on its deposits of cash and cash equivalents. The Company relies on a limited number of third-party manufacturers for the manufacturing and supply of its products. This could result in the Company not being able to acquire the inventory needed to meet customer demand, which would result in possible loss of sales and affect operating results adversely. |
Fair Value of Financial Instruments | (e) 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, contingent consideration, and the convertible feature related to the convertible note are discussed in Note 1(f) below. The fair value of the debt is based on the amount of future cash flows associated with the instrument discounted using the Company’s market rate. As of December 31, 2020, the carrying value of the long-term debt was not materially different from the fair value. As of December 31, 2020, the carrying value and fair value of the convertible note were as follows (in thousands): December 31, 2020 Carrying Value Fair Value Convertible note $ 44,436 $ 37,580 The convertible note is carried on the consolidated balance sheets at amortized cost. The fair value is estimated using a discounted cash flow analysis with a yield derived from a calibrated binomial lattice model as of the convertible note issuance date and adjusted for market movements thereafter. The market for trading of the convertible note is not considered to be an active market and therefore the estimate of fair value is based on Level 2 inputs. |
Fair Value Measurements | (f) 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. |
Property and Equipment | (g) Property and Equipment Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is computed using the straight‑line method over the estimated useful life of the asset, generally three to fifteen years. Leasehold improvements are depreciated over the shorter of the lease term or the estimated useful life of the related asset. Upon retirement or sale of an asset, the cost and related accumulated depreciation or amortization are removed from the consolidated balance sheet and any resulting gain or loss is reflected in operations in the period realized. Maintenance and repairs are charged to operations as incurred. |
Leases | (h) Leases The Company leases certain office space, warehouses, distribution facilities, manufacturing facilities and office equipment. The Company also has embedded leases of manufacturing facilities and equipment associated with the Company’s manufacturing contracts. The Company determines if an arrangement contains a lease at inception by evaluating whether the arrangement conveys the right to use an identified asset and whether the Company obtains substantially all of the economic benefits from and has the ability to direct the use of the asset. Operating and finance lease right-of-use, or ROU, assets and lease liabilities are recognized based on the present value of the future lease payments over the lease term at the commencement date. The Company determines its incremental borrowing rate based on the information available at the commencement date in determining the lease liabilities as the Company’s leases generally do not provide an implicit rate. The ROU assets also include any initial direct costs incurred and any lease payments made at or before the lease commencement date, less lease incentives received. Lease terms may include options to extend or terminate when the Company is reasonably certain that the option will be exercised. The Company elected to apply the short-term lease measurement and recognition exemption in which ROU assets and lease liabilities are not recognized for short-term leases. The Company’s lease agreements generally do not contain material residual value guarantees or material restrictive covenants. The Company’s leases of office space, warehouses, distribution facilities and manufacturing facilities are treated as operating leases and often contain lease and non-lease components. The Company has elected to account for these lease and non-lease components separately. Non-lease components for these assets are primarily comprised of common-area maintenance, utilities, and real estate taxes that are passed on from the lessor in proportion to the space leased by the Company, and are recognized in operating expenses in the period in which the obligation for those payments was incurred. Lease cost for these operating leases is recognized on a straight-line basis over the lease term in operating expenses. The Company’s embedded leases of manufacturing facilities and equipment are treated as operating leases and often contain lease and non-lease components. The Company has elected to account for these lease and non-lease components as a single lease component. There may be variability in future lease payments as the amount of the non-lease components is based on the costs of manufacturing and is dependent on the amount and types of units produced. The Company reduces the operating lease liability when the inventory is purchased. The Company’s leases of office equipment are accounted for as finance leases as they meet one or more of the five finance lease classification criteria. Lease cost for these finance leases is comprised of amortization of the ROU asset and interest expense which are recognized in operating expenses and other income (expense), net. |
Goodwill and Other Intangible Assets | ( i ) Goodwill and Other Intangible Assets Goodwill Goodwill represents the excess of the purchase price over the fair value of net assets of purchased businesses. Goodwill is not amortized, but instead is subject to impairment tests on at least an annual basis and whenever circumstances suggest that goodwill may be impaired. After the acquisition of miraDry, management began evaluating the Company as two reporting units, Breast Products and miraDry. 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 more likely than not that the fair value of a reporting unit is less than its carrying amount from the qualitative assessment, the Company performs a quantitative analysis to compare the fair value of the reporting unit to its carrying amount. The Company recognizes impairment charges for the amount by which the carrying amount exceeds the reporting unit’s fair value. The Company’s fair value analysis of goodwill utilizes the income approach and market approach, which requires the use of estimates about a reporting unit’s future revenues and free cash flows, market multiples, enterprise value, control risk premiums, discount rates, terminal value and enterprise value to determine the estimated fair value. The Company’s future revenues and free cash flow assumptions are determined based upon actual results giving effect to management’s expected changes in operating results in future years. The market multiples, enterprise value, control risk premiums, discount rates and terminal value are based upon market participant assumptions using a defined peer group. Changes in these assumptions can materially affect these estimates. Thus, to the extent the market changes, discount rates increase significantly or the Company do es not meet its projected performance, the Company could recognize impairments, and such impairments could be material. In the second quarter of 2019, the Company recorded a full impairment of goodwill in the miraDry reporting unit after performing a quantitative analysis. Refer to Note 5(a) for further details. Indefinite-lived intangible assets The Company tests indefinite-lived intangible assets for impairment on at least an annual basis and whenever circumstances suggest the assets may be impaired. The Company’s annual test for impairment is performed as of October 1 of each fiscal year. If indicators of impairment are present, the Company evaluates the carrying value of the intangible assets in relation to estimates of future undiscounted cash flows. If the carrying value of the intangible asset exceeds its fair value, an impairment loss is recognized in an amount equal to the difference. The Company also evaluates the remaining useful life of an indefinite-lived intangible asset to determine whether events and circumstances continue to support an indefinite useful life. For the years ended December 31, 2020, 2019, and 2018, the Company did not record any indefinite-lived intangible assets impairment charges. Finite-lived intangible assets The intangible assets are amortized to the consolidated statement of operations based on estimated cash flows generated from the intangible asset over its estimated life. Each fiscal year the Company evaluates the estimated remaining useful lives of purchased intangible assets and whether events or changes in circumstance warrant a revision to the remaining periods of amortization. Judgments about the recoverability of purchased finite‑lived intangible assets are made whenever events or changes in circumstance indicate that impairment may exist. Recoverability of finite‑lived intangible assets is measured by comparison of the carrying amount of the asset group to the future undiscounted cash flows the asset group is expected to generate. If the sum of the future undiscounted cash flows is less than the carrying value, the Company will evaluate whether the fair value of each asset in the asset group exceeds its respective carrying value. If the fair value of any asset in the asset group is determined to be less than its carrying value, then the Company will recognize an impairment loss based on the excess of the carrying amount over the asset’s respective fair value. The Company’s fair value analysis of intangible assets utilizes methods under various income approaches. The Company values its customer relationships using an excess earnings method, which assumes the value of the asset is the discounted future cash flows derived from existing customers and requires the use of customer attrition rates and discount rates to determine the estimated fair value. The future revenues and free cash flow from existing customers are determined based upon actual results giving effect to management’s expected changes in operating results in future years. The attrition rate is based on average historical levels of customer attrition and the discount rate is based upon market participant assumptions using a defined peer group. Tradenames and developed technology are valued using a relief from royalty method, which assumes the value of the asset is the discounted cash flows of the amount that would be paid by a hypothetical market participant had they not owned the asset and instead licensed the asset from another company. This method requires the use of royalty rates which are determined based on comparable third-party license agreements involving similar assets and discount rates similar to the above to determine the estimated fair value. In the second quarter of 2019, the Company recorded a partial impairment of intangible assets in the miraDry reporting unit after performing a quantitative analysis and subsequently recorded a full impairment in the first quarter of 2020. Refer to Note 5(b) for further details. |
Impairment of Tangible Long Lived Assets | ( j ) Impairment of Tangible Long‑Lived Assets The Company’s management routinely considers whether indicators of impairment of long‑lived assets are present. If such indicators are present, management determines whether the sum of the estimated undiscounted cash flows attributable to the asset group in question is less than their carrying value. If less, the Company will recognize an impairment loss based on the excess of the carrying amount of the assets over their respective fair values. Fair value is determined by discounted future cash flows, appraisals or other methods. If the assets determined to be impaired are to be held and used, the Company will recognize an impairment charge to the extent the present value of anticipated net cash flows attributable to the asset are less than the asset’s carrying value. The fair value of the asset will then become the asset’s new carrying value. |
Business Combinations | ( k ) Business Combinations Business combinations are accounted for using the acquisition method of accounting. Under the acquisition method, assets acquired and liabilities assumed are recorded at their respective fair values as of the acquisition date in the financial statements. The excess of the fair value of consideration transferred over the fair value of the net assets acquired is recorded as goodwill. Liability-classified contingent consideration obligations incurred in connection with a business combination are recorded at their fair values on the acquisition date and remeasured at their fair values each subsequent reporting period until the related contingencies are resolved. The resulting changes in fair values are recorded in earnings. Equity-classified contingent consideration obligations incurred in connection with a business combination are recorded at their fair values on the acquisition date and are not subsequently remeasured each reporting period unless the obligation becomes reclassified as a liability. The subsequent settlement of the obligation is accounted for within equity. |
Segment Reporting | ( l ) Reportable 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 howe 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. Based on the financial information presented to and reviewed by the CODM, the Company has determined that it has two reportable segments: Breast Products and miraDry. |
Revenue Recognition | ( m ) Revenue Recognition The Company generates revenue primarily through the sale and delivery of promised goods or services to customers. Sales prices are documented in the executed sales contract, purchase order or order acknowledgement prior to the transfer of control to the customer. Typical payment terms are 30 days for Breast Products and direct sales of consumable miraDry products and tend to be longer for capital sales of miraDry Systems and sales to miraDry distributors, but do not extend beyond one year. Revenue contracts may include multiple products or services, each of which is considered a separate performance obligation. Performance obligations typically include the delivery of promised products, such as breast implants, tissue expanders, BIOCORNEUM, miraDry Systems and bioTips, along with service-type warranties. Other deliverables are sometimes promised but are ancillary and insignificant in the context of the contract as a whole. Revenue is allocated to each performance obligation based on its relative standalone selling price. The Company determines standalone selling prices based on observable prices for all performance obligations with the exception of the service-type warranty under the Platinum20 Limited Warranty Program, or Platinum20. The Company introduced Platinum20 in May 2018 on all OPUS breast implants implanted in the United States or Puerto Rico on or after May 1, 2018. Platinum20 provides for financial assistance for revision surgeries and no-charge contralateral replacement implants upon the occurrence of certain qualifying events. The Company considers Platinum20 to have an assurance warranty component and a service warranty component. The assurance component is recorded as a warranty liability at the time of sale (as discussed in Note 1(t)). The Company considers the service warranty component as an additional performance obligation and defers revenue at the time of sale using the expected cost plus margin approach for the performance obligation. Inputs into the expected cost plus margin approach include historical incidence rates, estimated replacement costs, estimated financial assistance payouts and an estimated margin. The liability for unsatisfied performance obligations under the service warranty as of December 31, 2020 were as follows (in thousands): Year Ended December 31, 2020 Balance as of December 31, 2019 $ 1,596 Additions and adjustments 2,137 Revenue recognized (1,115 ) Balance as of December 31, 2020 $ 2,618 Revenue for service warranties are recognized ratably over the term of the agreements. Specifically for Platinum20, the performance obligation is satisfied at the time that the benefits are provided and are expected to be satisfied over the following 3 to 24 month period for financial assistance and 20 years for product replacement. For delivery of promised products, control transfers and revenue is recognized upon shipment, unless the contractual arrangement requires transfer of control when products reach their destination, for which revenue is recognized once the product arrives at its destination. For Breast Products, 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 miraDry, in addition to domestic and international direct sales, the Company 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 both direct sales agreements (domestic and international), and international distributor 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. Sales Return Liability 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. A sales return liability is established based on estimated returns using relevant historical experience taking into consideration recent gross sales and notifications of pending returns, as adjusted for changes in recent industry events and trends. The estimated sales returns are recorded as a reduction of revenue and as a sales return 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 following table provides a rollforward of the sales return liability (in thousands): Year Ended December 31, 2020 2019 Beginning balance $ 8,116 $ 6,048 Addition to reserve for sales activity 118,508 105,496 Actual returns (117,407 ) (104,148 ) Change in estimate of sales returns (25 ) 720 Ending balance $ 9,192 $ 8,116 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 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. For the Breast Products segment, s hipping and handling activities are largely provided to customers free of charge . The associated costs were $2.9 million, $1.9 million and $1.3 million for the years ended December 31, 2020 , 2019 , and 2018 , respectively. 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 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 consolidated statement of operations. The associated costs were $0.3 million , $0.7 million , and $0.4 million for the years ended December 31, 2020 , 2019 , and 2018 , respectively. |
Accounts Receivable and Allowance for Doubtful Accounts | ( n ) Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are recorded at the invoiced amount and do not bear interest. The Company maintains allowances for doubtful accounts for estimated losses resulting from the inability to collect from some of its customers. The allowances for doubtful accounts are based on the analysis of historical bad debts, customer credit‑worthiness, past transaction history with the customer, and current economic trends. If the financial condition of the Company’s customers were to deteriorate, adversely affecting their ability to make payments, additional allowances may be required. |
Inventories and Cost of Goods Sold | ( o ) Inventories and Cost of Goods Sold Inventories represent raw materials, work in process and finished goods that are recorded at the lower of cost or market on a first‑in, first‑out basis, or FIFO. The Company recognizes the cost of inventory transferred to the customer in cost of goods sold when revenue is recognized. Further, the Company periodically assesses the recoverability of all inventories to determine whether adjustments for impairment or obsolescence are required. The Company evaluates the remaining shelf life and other general obsolescence and impairment criteria in assessing the recoverability of the Company’s inventory. |
Income Taxes | ( p ) Income Taxes The Company accounts for income taxes under the asset and liability method. Under this method, deferred tax assets and liabilities are determined based on the difference between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amounts expected to be realized. The Company the Company The Company accounts for uncertain tax positions in accordance with Account Standards Codification, or ASC, 740‑10, Accounting for Uncertainty in Income Taxes |
Research and Development Expenditures | ( q ) Research and Development Expenditures Research and development costs are charged to operating expenses as incurred. Research and development, or R&D, primarily consist of clinical expenses, regulatory expenses, product development, consulting services, outside research activities, quality control and other costs associated with the development of the Company’s products and compliance with Good Clinical Practices, or GCP, requirements. R&D expenses also include related personnel and consultant compensation and stock-based compensation expense. |
Advertising | ( r ) Advertising Expenses related to advertising are charged to sales and marketing expense as incurred. Advertising costs were $3.6 million, $6.1 million and $1.3 million for the years ended December 31, 2020, 2019 and 2018, respectively. |
Stock-Based Compensation | ( s ) Stock‑Based Compensation The Company applies the fair value provisions of ASC 718, Compensation — Stock Compensation The option-pricing models require the input of subjective assumptions, including the risk‑free interest rate, expected dividend yield, expected volatility and expected term, among other inputs. These estimates involve inherent uncertainties and the application of management’s judgment. If factors change and different assumptions are used, our stock‑based compensation expense could be materially different in the future. These assumptions are estimated as follows: • Risk‑free interest rate —The risk‑free interest rate is based on the yields of U.S. Treasury securities with maturities similar to the expected term of the options for each option group. • Dividend yield —The Company has never declared or paid any cash dividends and do not presently plan to pay cash dividends in the foreseeable future. Consequently, the Company utilized an expected dividend yield of zero. • Expected volatility —In the prior years, the Company utilized median historic price volatilities and implied volatilities of comparable public companies due to a lack of significant trading history for the Company’s own common stock. In the current year, the Company estimated its expected stock volatility based on company-specific historical and implied volatility information of its stock as sufficient historical information has become available. • Expected term —The expected term represents the period that our stock‑based awards are expected to be outstanding. The Company utilizes the simplified method to estimate the expected term. |
Product Warranties | ( t ) 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 silicone gel breast implant surgeries occurring prior to May 1, 2018, the Company provides lifetime replacement implants and up to $ 3,600 in financial assistance for revision surgeries, for covered rupture events that occur within ten years of the surgery date. The Company introduced its Platinum20 Limited Warranty Program in May 2018, covering OPUS silicone ge l breast implants implanted in the United States or Puerto Rico on or after May 1, 2018. The Company considers the program to have an assurance warranty component and a service warranty component. The service warranty component is discussed in Note 1 ( m ) above . The assurance component is related to the lifetime no-charge contralateral replacement implants and up to $5,000 in financial assistance for revision surgeries, for covered rupture events that occur within twenty years of the surgery date. Under the miraDry warranty, the Company provides a standard product warranty for the miraDry System and bioTips , which the Company considers an assurance-type warranty. |
Net Loss Per Share | ( u ) Net Loss Per Share December 31, 2020 2019 2018 Net loss (in thousands) $ (89,947 ) $ (106,818 ) $ (82,627 ) Weighted average common shares outstanding, basic and diluted 50,233,175 40,654,272 25,402,241 Net loss per share attributable to common stockholders $ (1.79 ) $ (2.63 ) $ (3.25 ) The Company excluded the following potentially dilutive securities, outstanding as of December 31, 2020, 2019 and 2018 from the computation of diluted net loss per share attributable to common stockholders for the years ended December 31, 2020, 2019 and 2018 because they had an anti-dilutive impact due to the net loss attributable to common stockholders incurred for the periods. December 31, 2020 2019 2018 Stock options to purchase common stock 2,559,558 1,967,367 1,625,778 Warrants for the purchase of common stock 17,040 47,710 47,710 Equity contingent consideration 607,442 — — Stock issuable upon conversion of convertible note 19,733,352 — — 22,917,392 2,015,077 1,673,488 The Company uses the if-converted method for calculating any potential dilutive effects of the convertible note. The Company did not adjust the net loss for the year ended December 31, 2020 to eliminate any interest expense or gain/loss for the derivative liability related to the note in the computation of diluted loss per share, as the effects would be anti-dilutive. |
Recent Accounting Pronouncements | ( v ) Recent Accounting Pronouncements Recently Adopted Accounting Standards In February 2016, the FASB issued Accounting Standards Update, or ASU, 2016-02, Leases (Topic 842). This ASU requires a company to recognize lease assets and liabilities arising from operating leases in the statement of financial position. This ASU does not significantly change the previous lease guidance for how a lessee should recognize the recognition, measurement, and presentation of expenses and cash flows arising from a lease. Additionally, the criteria for classifying a finance lease versus an operating lease are substantially the same as the previous guidance. This ASU is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, and early adoption was permitted. In July 2018, the FASB issued ASU 2018-11, Leases (Topic 842) Targeted Improvements, amending certain aspects of the new leasing standard. The amendment allowed an additional optional transition method whereby an entity records a cumulative effect adjustment to opening retained earnings in the year of adoption without restating prior periods. The Company adopted Topic 842 on January 1, 2019 electing the package of practical expedients permitted under the transition guidance, which allowed the Company to carry forward the historical lease classification, the assessment on whether a contract is or contains a lease, and the initial direct costs for any leases that exist prior to adoption of the new standard. The Company has not restated prior periods under the optional transition method. The adoption of ASU 2016-02 on January 1, 2019 resulted in the recognition of right-of-use assets of approximately $ 22.7 million, lease liabilities of approximately $ 22.9 million and no cumulative-effect adjustment on retained earnings on its consolidated balance sheets. In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820) - Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement In August 2018, the FASB issued ASU 2018-15, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40) - Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement that is a Service Contract Recently Issued Accounting Standards In August 2020, the FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848)-Facilitation of the Effects of Reference Rate Reform on Financial Reporting In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes |
Risks and Uncertainties | (w) Risks and Uncertainties The rapid, global spread of COVID-19 has resulted in significant economic uncertainty, significant declines in business and consumer confidence and global demand in the non-essential healthcare industry (among others), a global economic slowdown, and could lead to a global recession. The Company is subject to risks and uncertainties as a result of the COVID-19 pandemic. The full extent to which the COVID-19 pandemic will directly or indirectly impact the Company’s business, results of operations and financial condition, including sales, expenses, reserves and allowances, manufacturing, and employee-related amounts, will depend on future developments that are highly uncertain. The Company continues to monitor and assess new information related to the COVID-19 pandemic, the actions taken to contain or treat COVID-19, as well as the economic impact on local, regional, national and international customers and markets. As an aesthetics company, surgical procedures involving the Company’s breast and miraDry products are susceptible to local and national government restrictions, such as social distancing, “shelter in place” orders and business closures, due to the economic and logistical impacts these measures have on consumer demand as well as the practitioners’ ability to administer such procedures. The inability or limited ability to perform such non-emergency procedures significantly harmed the Company’s revenues during the second quarter of 2020 and continued to harm the Company’s revenues during the third and fourth quarter of 2020. While some states have lifted certain restrictions on non-emergency procedures, the Company will likely continue to experience future harm to its revenues while existing or new restrictions remain in place. Further, the spread of COVID-19 has caused the Company to modify workforce practices, and the Company may take further actions determined to be in the best interests of the Company’s employees or as required by governments. In addition, capital markets and economies worldwide have also been negatively impacted by the COVID-19 pandemic, and it is possible that this can lead to a local and/or global economic recession, which may result in further harm to the aesthetics market. Such economic disruption could adversely affect the Company’s business. The continued spread of COVID-19, or another infectious disease, could also result in delays or disruptions in the Company’s supply chain or adversely affect the Company’s manufacturing facilities and personnel. Further, trade and/or national security protection policies may be adjusted as a result of the COVID-19 pandemic, such as actions by governments that limit, restrict or prevent the movement of certain goods into a country and/or region, and current U.S./China trade relations may be further exacerbated by the pandemic. The estimates used for, but not limited to, determining the collectability of accounts receivable, fair value of long-lived assets and goodwill, and sales returns liability required could be impacted by the pandemic. While the full impact of COVID-19 is unknown at this time, the Company has made appropriate estimates based on the facts and circumstances available as of the reporting date. These estimates may change as new events occur and additional information is obtained. |
Reclassifications | ( x ) Reclassifications Certain reclassifications have been made to prior year amounts to conform to the current year presentation. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Schedule of Carrying Value and Fair Value of Convertible Note | As of December 31, 2020, the carrying value and fair value of the convertible note were as follows (in thousands): December 31, 2020 Carrying Value Fair Value Convertible note $ 44,436 $ 37,580 |
Schedule of Liability for Unsatisfied Performance Obligations Under Service Warranty | The liability for unsatisfied performance obligations under the service warranty as of December 31, 2020 were as follows (in thousands): Year Ended December 31, 2020 Balance as of December 31, 2019 $ 1,596 Additions and adjustments 2,137 Revenue recognized (1,115 ) Balance as of December 31, 2020 $ 2,618 |
Schedule of Rollforward of Sales Return Liability | The following table provides a rollforward of the sales return liability (in thousands): Year Ended December 31, 2020 2019 Beginning balance $ 8,116 $ 6,048 Addition to reserve for sales activity 118,508 105,496 Actual returns (117,407 ) (104,148 ) Change in estimate of sales returns (25 ) 720 Ending balance $ 9,192 $ 8,116 |
Schedule of net loss per share, basic and diluted | December 31, 2020 2019 2018 Net loss (in thousands) $ (89,947 ) $ (106,818 ) $ (82,627 ) Weighted average common shares outstanding, basic and diluted 50,233,175 40,654,272 25,402,241 Net loss per share attributable to common stockholders $ (1.79 ) $ (2.63 ) $ (3.25 ) |
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 December 31, 2020, 2019 and 2018 from the computation of diluted net loss per share attributable to common stockholders for the years ended December 31, 2020, 2019 and 2018 because they had an anti-dilutive impact due to the net loss attributable to common stockholders incurred for the periods. December 31, 2020 2019 2018 Stock options to purchase common stock 2,559,558 1,967,367 1,625,778 Warrants for the purchase of common stock 17,040 47,710 47,710 Equity contingent consideration 607,442 — — Stock issuable upon conversion of convertible note 19,733,352 — — 22,917,392 2,015,077 1,673,488 |
Restructuring (Tables)
Restructuring (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Restructuring And Related Activities [Abstract] | |
Summary of Liabilities Related to Plan Included in Accrued and Other Current Liabilities in Consolidated Balance Sheet | The following table details the activity of liabilities related to the Plan included in "Accrued and other current liabilities" in the consolidated balance sheet as of December 31, 2020 (amounts in thousands): Severance costs Other associated costs Duplicate operating costs Balance at December 31, 2019 $ 894 $ — $ — Costs charged to expense 1,380 208 174 Costs paid or otherwise settled (2,274 ) (208 ) (174 ) Balance at December 31, 2020 $ — $ — $ — |
Schedule of Charges by Reportable Segment, Recorded in Restructuring Costs Under Operating Expenses in Consolidated Statements of Operations | The following table details the charges by reportable segment, recorded in "Restructuring" under operating expenses in the consolidated statements of operations for the year ended December 31, 2020 by segment (amounts in thousands): Year Ended Year Ended Cumulative Restructuring December 31, 2019 December 31, 2020 Charges Breast Products $ 499 $ 390 $ 889 miraDry 584 1,372 1,956 Total $ 1,083 $ 1,762 $ 2,845 |
Acquisitions (Tables)
Acquisitions (Tables) - Vesta Intermediate Funding, Inc | 12 Months Ended |
Dec. 31, 2020 | |
Business Acquisition [Line Items] | |
Schedule of Aggregate Preliminary Acquisition Date Fair Value of Consideration Transferred | The aggregate acquisition date fair value of the consideration transferred was approximately $27.0 million, consisting of the following (in thousands): Fair Value Cash consideration at Acquisition Date $ 14,000 Deferred consideration 4,737 Equity contingent consideration 3,156 Purchase price for additional inventory purchase 5,113 Total purchase consideration $ 27,006 |
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): November 7, 2019 Inventories $ 7,138 Property and equipment 7,304 Goodwill 4,324 Intangible assets 8,240 Net assets acquired $ 27,006 |
Balance Sheet Components (Table
Balance Sheet Components (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Balance Sheet Related Disclosures [Abstract] | |
Schedule of inventories, net | Inventories, net consist of the following (in thousands): December 31, December 31, 2020 2019 Raw materials $ 7,138 $ 8,095 Work in progress 12,303 5,543 Finished goods 25,791 23,893 Finished goods - right of return 3,416 2,081 $ 48,648 $ 39,612 |
Schedule of property and equipment, net | Property and equipment, net consist of the following (in thousands): December 31, December 31, 2020 2019 Leasehold improvements $ 2,857 $ 2,841 Manufacturing equipment and toolings 9,289 8,175 Computer equipment 2,776 1,250 Software 3,546 2,602 Office equipment 167 111 Furniture and fixtures 1,193 1,144 19,828 16,123 Less accumulated depreciation (6,722 ) (3,809 ) $ 13,106 $ 12,314 |
Schedule of accrued and other current liabilities | Accrued and other current liabilities consist of the following: December 31, December 31, 2020 2019 Payroll and related expenses $ 3,524 $ 6,789 Accrued severance 2,900 894 Accrued commissions 5,561 4,984 Accrued manufacturing 225 2,616 Deferred and contingent consideration, current portion 10,146 6,830 Audit, consulting and legal fees 48 630 Accrued sales and marketing expenses 445 1,109 Lease liabilities 1,588 1,299 Other 7,952 7,400 $ 32,389 $ 32,551 |
Schedule of rollforward of the accrued warranties | The following table provides a rollforward of the accrued warranties (in thousands): Year Ended December 31, 2020 2019 Balance as of January 1 $ 1,562 $ 1,395 Warranty costs incurred during the period (832 ) (762 ) Changes in accrual related to warranties issued during the period 1,200 1,138 Changes in accrual related to pre-existing warranties 71 (209 ) Balance as of December 31 $ 2,001 $ 1,562 |
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 December 31, 2020 and 2019 and indicate the level of the fair value hierarchy utilized to determine such fair value (in thousands): Fair Value Measurements as of December 31, 2020 Using: Level 1 Level 2 Level 3 Total Liabilities: Liability for common stock warrants $ — $ — $ — $ — Liability for contingent consideration — — 7,026 7,026 Liability for derivative — — 26,570 26,570 $ — $ — $ 33,596 $ 33,596 Fair Value Measurements as of December 31, 2019 Using: Level 1 Level 2 Level 3 Total Liabilities: Liability for common stock warrants $ — $ — $ 38 $ 38 Liability for contingent consideration — — 6,891 6,891 $ — $ — $ 6,929 $ 6,929 |
Schedule of Aggregate Fair Values of Company's Liabilities 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 liabilities for which fair value is determined by Level 3 inputs (in thousands): Warrant liability Contingent consideration liability Derivative liability Balance, December 31, 2019 $ 38 $ 6,891 $ — Additions — — 16,100 Change in fair value (38 ) 135 10,470 Balance, December 31, 2020 $ — $ 7,026 $ 26,570 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets, net (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Schedule of Changes in Carrying Amount of Goodwill | The changes in the carrying amount of goodwill during the years ended December 31, 2020 and 2019 were as follows (in thousands): Breast Products miraDry Total Balances as of December 31, 2018 $ 19,156 $ 7,629 $ 26,785 Accumulated impairment losses (14,278 ) (7,629 ) (21,907 ) Goodwill acquired (Note 3) 4,324 — 4,324 Balances as of December 31, 2019 $ 9,202 $ — $ 9,202 Goodwill acquired — — — Balances as of December 31, 2020 $ 9,202 $ — $ 9,202 |
Schedule of Other Intangible assets | The components of the Company’s other intangible assets consist of the following definite-lived and indefinite-lived assets (in thousands): Average Amortization December 31, 2020 Period Gross Carrying Accumulated Intangible (in years) Amount Amortization Assets, net Intangibles with definite lives Customer relationships 10 $ 4,940 $ (3,856 ) $ 1,084 Trade names - finite life 12 800 (322 ) 478 Non-compete agreement 2 80 (80 ) — Regulatory approvals 1 670 (670 ) — Acquired FDA non-gel product approval 11 1,713 (1,713 ) — Manufacturing know-how 19 8,240 (865 ) 7,375 Total definite-lived intangible assets $ 16,443 $ (7,506 ) $ 8,937 Intangibles with indefinite lives Trade names - indefinite life — 450 — 450 Total indefinite-lived intangible assets $ 450 $ — $ 450 Average Amortization December 31, 2019 Period Gross Carrying Accumulated Intangible (in years) Amount Amortization Assets, net Intangibles with definite lives Customer relationships 11 $ 9,540 $ (3,846 ) $ 5,694 Trade names - finite life 14 2,000 (292 ) 1,708 Developed technology 13 1,500 (84 ) 1,416 Non-compete agreement 2 80 (80 ) — Regulatory approvals 1 670 (670 ) — Acquired FDA non-gel product approval 11 1,713 (1,713 ) — Manufacturing know-how 19 8,240 (118 ) 8,122 Total definite-lived intangible assets $ 23,743 $ (6,803 ) $ 16,940 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 intangible assets as of December 31, 2020 (in thousands): Amortization Period Expense 2021 $ 1,221 2022 1,163 2023 1,092 2024 948 2025 805 Thereafter 3,708 $ 8,937 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
Components of Lease Expense | Components of lease expense were as follows: Year Ended December 31, Lease Cost Classification 2020 2019 Operating lease cost Operating expenses $ 1,698 $ 1,550 Operating lease cost Inventory 488 4,206 Total operating lease cost $ 2,186 $ 5,756 Finance lease cost Amortization of right-of-use assets Operating expenses 41 41 Amortization of right-of-use assets Inventory 36 — Interest on lease liabilities Other income (expense), net 10 4 Total finance lease cost $ 87 $ 45 Variable lease cost Inventory — 10,568 Total lease cost $ 2,273 $ 16,369 |
Supplemental Cash Flow Information Related to Operating and Finance Leases | Supplemental cash flow information related to operating and finance leases was as follows (in thousands): Year Ended December 31, 2020 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash outflows from operating leases $ 1,758 $ 5,419 Operating cash outflows from finance leases 85 44 Right-of-use assets obtained in exchange for lease obligations: Operating leases $ 1,242 $ 8,667 Finance leases 157 117 |
Supplemental Balance Sheet Information Related to Operating and Finance Leases | Supplemental balance sheet information related to operating and finance leases was as follows (in thousands, except lease term and discount rate): December 31, December 31, 2020 2019 Reported as: Other assets Operating lease right-of-use assets $ 7,176 $ 7,494 Finance lease right-of-use assets 158 78 Total right-of use assets $ 7,334 $ 7,572 Accrued and other current liabilities Operating lease liabilities $ 1,504 $ 1,259 Finance lease liabilities 84 40 Warranty reserve and other long-term liabilities Operating lease liabilities 5,946 6,434 Finance lease liabilities 77 35 Total lease liabilities $ 7,611 $ 7,768 Weighted average remaining lease term (years) Operating leases 5 5 Finance leases 2 2 Weighted average discount rate Operating leases 7.75 % 7.45 % Finance leases 6.15 % 4.06 % |
Maturities of Operating and Finance Lease Liabilities | As of December 31, 2020, maturities of the Company’s operating and finance lease liabilities are as follows (in thousands): Period Operating leases Finance leases Total 2021 $ 2,095 $ 89 $ 2,184 2022 1,920 53 1,973 2023 1,968 28 1,996 2024 1,507 1 1,508 2025 579 — 579 2026 and thereafter 955 — 955 Total lease payments $ 9,024 $ 171 $ 9,195 Less imputed interest 1,574 10 1,584 Total operating lease liabilities $ 7,450 $ 161 $ 7,611 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Future Principal and Exit Fee Payments for Outstanding Debt | The future schedule of principal and exit fee payments for all outstanding debt as of December 31, 2020 was as follows (in thousands): Fiscal Year 2021 $ 5,409 2022 8,326 2023 5,000 2024 3,667 2025 60,000 Total $ 82,402 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Schedule of Provision for Income Tax | The provision for income tax consists of the following: Year Ended December 31, 2020 2019 2018 Federal $ 12 $ 9 $ 2 State 10 9 (10 ) Foreign 11 16 4 Total income tax (benefit) expense $ 33 $ 34 $ (4 ) |
Schedule of Reconciliation of Actual Income Tax Expense Obtained by Applying Statutory Federal Income Tax Rate | Actual income tax expense differs from that obtained by applying the statutory federal income tax rate of 21% in 2020, 2019, and 2018, respectively, to income before income taxes as follows: (in thousands): Year Ended December 31, 2020 2019 2018 Tax at federal statutory rate $ (18,882 ) $ (22,424 ) $ (17,353 ) State, net of federal benefit (2,372 ) (2,109 ) (5,999 ) Permanent items 2,282 857 338 Benefit state rate change 20 337 60 Other 2,984 368 (103 ) Goodwill impairment — 1,602 — Change in valuation allowance 16,001 21,403 23,053 $ 33 $ 34 $ (4 ) |
Schedule of Tax Effects of Temporary Differences and Carryforwards that Give Rise to Significant Portions of Deferred Tax Assets and Liabilities | The tax effects of temporary differences and carryforwards that give rise to significant portions of the deferred tax assets and liabilities are as follows (in thousands): December 31, 2020 2019 Net operating loss carryforwards $ 113,374 $ 99,759 Research and development credits 2,121 3,626 Lease liabilities 1,861 1,902 Derivative liability 6,495 — Accruals and reserves 10,175 9,636 Intangibles 3,053 5,330 137,079 120,253 Less valuation allowance (131,309 ) (115,307 ) Total deferred tax assets $ 5,770 $ 4,946 Depreciation $ (276 ) $ (40 ) Convertible debt discount (3,440 ) — Right-of-use assets (1,793 ) (1,854 ) Intangibles - deferred tax liability (333 ) (3,102 ) Total deferred tax liabilities (5,842 ) (4,996 ) Net deferred taxes $ (72 ) $ (50 ) |
Schedule of Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in thousands): Ending balance at December 31, 2018 $ 1,076 Additions based on tax positions taken in the current year 40 Ending balance at December 31, 2019 1,116 Additions based on tax positions taken in the current year 10 Decreases based on tax positions taken in the prior year (507 ) Ending balance at December 31, 2020 $ 619 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Summary of option activity | 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, 2018 1,953,334 $ 7.42 6.30 Exercised (51,451 ) 2.44 Forfeited (21,037 ) 19.39 Balances at December 31, 2019 1,880,846 $ 7.42 5.48 Granted 600,000 3.58 Exercised (9,817 ) 2.89 Forfeited (511,528 ) 8.87 Balances at December 31, 2020 1,959,501 $ 4.79 5.92 Vested and expected to vest at December 31, 2020 1,959,501 Vested and exercisable at December 31, 2020 1,359,558 8.53 |
Summary of RSUs activity | Activity related to RSUs is set forth below: Weighted average Number grant date of shares fair value Balances at December 31, 2018 2,141,350 $ 13.27 Granted 1,407,768 8.02 Vested (944,467 ) 10.56 Forfeited (371,695 ) 7.99 Balances at December 31, 2019 2,232,956 $ 11.99 Granted 3,070,430 4.77 Vested (1,150,707 ) 10.06 Forfeited (1,058,889 ) 7.82 Balances at December 31, 2020 3,093,790 $ 6.97 |
Stock Option | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Schedule of Fair Value of Employee Stock Options Estimated Using Black-Scholes Option Valuation Model | The following table presents the weighted‑average assumptions used to estimate the fair value of options granted during the periods presented: Year Ended December 31, Stock Options 2020 2019 2018 Expected term (in years) 6.50 — — Expected volatility 82.65% — — Risk-free interest rate 0.27% — — Dividend yield — — — |
Employee Stock Purchase Plan | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Schedule of Fair Value of Employee Stock Options Estimated Using Black-Scholes Option Valuation Model | The following table presents the weighted-average assumptions used to estimate the fair value of the stock purchase rights granted under the employee stock purchase plan: Year Ended December 31, ESPP 2020 2019 2018 Expected term (in years) 0.50 to 2.00 0.50 to 2.00 0.50 to 2.00 Expected volatility 68 % to 139 % 69 % to 77 % 36 % to 42 % Risk-free interest rate 0.14 % to 1.57 % 1.87 % to 2.06 % 1.27 % to 3.03 % Dividend yield — — — |
Segment Reporting and Geograp_2
Segment Reporting and Geographic Information (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
Summary of Net Sales, Net Operating Loss and Net Assets by Reportable Segment | The following tables present the net sales, net operating loss and net assets by reportable segment for the periods presented (in thousands): Year Ended December 31, 2020 2019 2018 Net sales Breast Products $ 54,997 $ 46,363 $ 37,016 miraDry 16,244 37,336 31,110 Total net sales $ 71,241 $ 83,699 $ 68,126 Year Ended December 31, 2020 2019 2018 Loss from operations Breast Products $ (46,521 ) $ (50,175 ) $ (53,047 ) miraDry (23,789 ) (53,392 ) (26,727 ) Total loss from operations $ (70,310 ) $ (103,567 ) $ (79,774 ) December 31, December 31, 2020 2019 Assets Breast Products $ 151,059 $ 169,613 miraDry 17,919 34,791 Total assets $ 168,978 $ 204,404 |
Summary of Net Sales by Geographical Regions | The following table presents the net sales by geographical region for the periods presented (in thousands): Year Ended December 31, 2020 2019 2018 United States $ 58,752 $ 62,277 $ 49,975 International 12,489 21,422 18,151 Total net sales $ 71,241 $ 83,699 $ 68,126 |
Summary of Quarterly Financia_2
Summary of Quarterly Financial Information (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Selected Quarterly Financial Information [Abstract] | |
Summary of Quarterly Financial Information (Unaudited) | Quarter Ended 2020 March 31 June 30 September 30 December 31 (in thousands, except share data) Net sales $ 16,932 $ 12,448 $ 19,217 $ 22,644 Gross profit 10,140 6,898 10,826 11,075 Net loss (28,612 ) (34,277 ) (5,821 ) (21,237 ) Net loss per share: Basic and diluted $ (0.57 ) $ (0.68 ) $ (0.12 ) $ (0.42 ) Quarter Ended 2019 March 31 June 30 September 30 December 31 (in thousands, except share data) Net sales $ 17,552 $ 20,525 $ 22,412 $ 23,210 Gross profit 11,078 12,712 12,658 14,239 Net loss (26,484 ) (37,654 ) (22,433 ) (20,247 ) Net loss per share: Basic and diluted $ (0.91 ) $ (1.10 ) $ (0.45 ) $ (0.41 ) |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) | Apr. 20, 2020USD ($) | Jun. 07, 2019USD ($)$ / sharesshares | Jan. 01, 2019USD ($) | May 07, 2018USD ($)$ / sharesshares | Apr. 20, 2020USD ($) | Dec. 31, 2020USD ($)ReportingUnitSegmentshares | Dec. 31, 2019USD ($)shares | Dec. 31, 2018USD ($)shares | Mar. 11, 2020USD ($) |
Summary Of Significant Accounting Policies [Line Items] | |||||||||
Common stock, shares issued | shares | 50,712,151 | 49,612,907 | |||||||
Cash and cash equivalents | $ 54,967,000 | $ 87,608,000 | $ 86,899,000 | ||||||
Segment Information | |||||||||
Number of reporting units | ReportingUnit | 2 | ||||||||
Number of reportable segments | Segment | 2 | ||||||||
Indefinite-lived intangible assets impairment charges | $ 0 | 0 | 0 | ||||||
Replacement implants and revision surgery financial assistance under limited warranty program | 2,001,000 | 1,562,000 | $ 1,395,000 | ||||||
Right-of-use asset | 7,176,000 | $ 7,494,000 | |||||||
Lease, liabilities | $ 7,450,000 | ||||||||
ASU 2016-02 | |||||||||
Segment Information | |||||||||
Cumulative effect adjustment | $ 0 | ||||||||
Right-of-use asset | 22,700,000 | ||||||||
Lease, liabilities | $ 22,900,000 | ||||||||
Silicone Gel Breast Implant Surgeries Occurring Prior to May 1, 2018 | |||||||||
Segment Information | |||||||||
Period to claim financial assistance under limited warranty program | 10 years | ||||||||
Silicone Gel Breast Implants Occurring on or after May 1, 2018 | |||||||||
Segment Information | |||||||||
Period to claim financial assistance under limited warranty program | 20 years | ||||||||
Common stock | |||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||
Proceeds from follow-on offering, net of costs (in shares) | shares | 37,000 | 20,000,000 | 8,518,519 | ||||||
Underwritten Follow-On Offering | Common stock | |||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||
Proceeds from follow-on offering, net of costs (in shares) | shares | 17,391,305 | 7,407,408 | |||||||
Public offering price (in dollars per share) | $ / shares | $ 5.75 | $ 13.50 | |||||||
Additional shares granted to underwriters | shares | 2,608,695 | 1,111,111 | |||||||
Proceeds from the issuance of common stock, net of underwriting discounts, commissions and offering expenses | $ 107,700,000 | $ 107,600,000 | |||||||
Payment of underwriting discounts and commissions and offering expenses | 6,900,000 | 6,900,000 | |||||||
Offering expenses | $ 400,000 | $ 500,000 | |||||||
Maximum | Silicone Gel Breast Implant Surgeries Occurring Prior to May 1, 2018 | |||||||||
Segment Information | |||||||||
Replacement implants and revision surgery financial assistance under limited warranty program | $ 3,600 | ||||||||
Maximum | Silicone Gel Breast Implants Occurring on or after May 1, 2018 | |||||||||
Segment Information | |||||||||
Replacement implants and revision surgery financial assistance under limited warranty program | $ 5,000 | ||||||||
Paycheck Protection Program | |||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||
Debt instrument principal | $ 6,700,000 | $ 6,700,000 | |||||||
Debt instrument interest rate | 1.00% | 1.00% | |||||||
Debt maturity date | Apr. 20, 2022 | Apr. 20, 2022 | |||||||
At-The-Market Equity Offering Sales Agreement | |||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||
Common stock, shares issued | shares | 37,000,000 | ||||||||
At-The-Market Equity Offering Sales Agreement | Maximum | |||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||
Aggregate gross offering price | $ 50,000,000 | ||||||||
Deerfield Facility Agreement | |||||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||||
Debt instrument principal | $ 60,000,000 | ||||||||
Debt instrument interest rate | 4.00% |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Schedule of Carrying Value and Fair Value of Convertible Note (Details) - Convertible Note $ in Thousands | Dec. 31, 2020USD ($) |
Debt Instrument [Line Items] | |
Carrying Value | $ 44,436 |
Fair Value | $ 37,580 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies (PPE and Revenue) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Property, Plant and Equipment | |||
Period for sales return | 6 months | ||
Revenue, practical expedient, incremental cost of obtaining contract | true | ||
Revenue, practical expedient, significant financing component | true | ||
Shipping and handling costs | $ 32,302,000 | $ 33,012,000 | $ 26,822,000 |
Advertising | |||
Advertising costs | 3,600,000 | 6,100,000 | 1,300,000 |
Breast Products | Sales and marketing expense | |||
Property, Plant and Equipment | |||
Shipping and handling costs | $ 2,900,000 | $ 1,900,000 | $ 1,300,000 |
Type of Cost, Good or Service [Extensible List] | us-gaap:ShippingAndHandlingMember | us-gaap:ShippingAndHandlingMember | us-gaap:ShippingAndHandlingMember |
miraDry | Cost of goods sold | |||
Property, Plant and Equipment | |||
Shipping and handling costs | $ 300,000 | $ 700,000 | $ 0.4 |
Type of Cost, Good or Service [Extensible List] | us-gaap:ShippingAndHandlingMember | us-gaap:ShippingAndHandlingMember | us-gaap:ShippingAndHandlingMember |
Minimum | |||
Property, Plant and Equipment | |||
Estimated useful life of asset | 3 years | ||
Percentage of largest amount of tax benefit of settled uncertain tax position | 50.00% | ||
Maximum | |||
Property, Plant and Equipment | |||
Estimated useful life of asset | 15 years |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies (PPE and Revenue) (Details 1) - Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2021-01-01 | Dec. 31, 2020 |
Breast Products and Consumable miraDry products | |
Summary Of Significant Accounting Policies [Line Items] | |
Performance obligation satisfying period | 30 days |
Product Replacement | |
Summary Of Significant Accounting Policies [Line Items] | |
Performance obligation satisfying period | 20 years |
Maximum | MiraDry Systems | |
Summary Of Significant Accounting Policies [Line Items] | |
Performance obligation satisfying period | 1 year |
Maximum | Financial Service | |
Summary Of Significant Accounting Policies [Line Items] | |
Performance obligation satisfying period | 24 months |
Minimum | Financial Service | |
Summary Of Significant Accounting Policies [Line Items] | |
Performance obligation satisfying period | 3 months |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies - Schedule of Liability for Unsatisfied Performance Obligations Under Service Warranty (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Change In Contract With Customer Liability [Abstract] | |
Balance as of December 31, 2019 | $ 1,596 |
Additions and adjustments | 2,137 |
Revenue recognized | (1,115) |
Balance as of December 31, 2020 | $ 2,618 |
Summary of Significant Accoun_9
Summary of Significant Accounting Policies - Schedule of Rollforward of Sales Return Liability (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Revenue Recognition [Abstract] | ||
Beginning balance | $ 8,116 | $ 6,048 |
Addition to reserve for sales activity | 118,508 | 105,496 |
Actual returns | (117,407) | (104,148) |
Change in estimate of sales returns | (25) | 720 |
Ending balance | $ 9,192 | $ 8,116 |
Summary of Significant Accou_10
Summary of Significant Accounting Policies - Schedule of Net Loss Per Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Accounting Policies [Abstract] | |||||||||||
Net loss | $ (21,237) | $ (5,821) | $ (34,277) | $ (28,612) | $ (20,247) | $ (22,433) | $ (37,654) | $ (26,484) | $ (89,947) | $ (106,818) | $ (82,627) |
Weighted average common shares outstanding, basic and diluted | 50,233,175 | 40,654,272 | 25,402,241 | ||||||||
Net loss per share attributable to common stockholders | $ (0.42) | $ (0.12) | $ (0.68) | $ (0.57) | $ (0.41) | $ (0.45) | $ (1.10) | $ (0.91) | $ (1.79) | $ (2.63) | $ (3.25) |
Summary of Significant Accou_11
Summary of Significant Accounting Policies - Schedule of Potentially Dilutive Securities Excluded from Computation of Diluted Net Loss Per Share Attributable to Common Stockholders (Details) - shares | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Potentially dilutive securities | |||
Potentially dilutive securities | 22,917,392 | 2,015,077 | 1,673,488 |
Stock options to purchase common stock | |||
Potentially dilutive securities | |||
Potentially dilutive securities | 2,559,558 | 1,967,367 | 1,625,778 |
Warrants for the purchase of common stock | |||
Potentially dilutive securities | |||
Potentially dilutive securities | 17,040 | 47,710 | 47,710 |
Equity contingent consideration | |||
Potentially dilutive securities | |||
Potentially dilutive securities | 607,442 | ||
Stock issuable upon conversion of convertible note | |||
Potentially dilutive securities | |||
Potentially dilutive securities | 19,733,352 |
Restructuring (Details)
Restructuring (Details) $ in Millions | Nov. 06, 2019USD ($)Employee |
Organizational Efficiency Initiative | |
Restructuring Cost And Reserve [Line Items] | |
Restructuring and related, expected cost | $ 2.8 |
miraDry's Santa Clara | |
Restructuring Cost And Reserve [Line Items] | |
Restructuring and related activities, description | Under the Plan, the Company reduced its workforce by terminating approximately 60 employees. |
Restructuring charges estimated incur period | Employee | 60 |
One Time Employee Termination Costs Retention Costs And Other Benefits | Organizational Efficiency Initiative | |
Restructuring Cost And Reserve [Line Items] | |
Restructuring and related, expected cost | $ 2.3 |
Duplicate Operating Costs | Organizational Efficiency Initiative | |
Restructuring Cost And Reserve [Line Items] | |
Restructuring and related, expected cost | $ 0.5 |
Restructuring - Summary of Liab
Restructuring - Summary of Liabilities Related to Plan Included in Accrued and Other Current Liabilities in Consolidated Balance Sheet (Details) - USD ($) $ in Thousands | 12 Months Ended | 14 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | |
Restructuring Cost And Reserve [Line Items] | |||
Costs charged to expense | $ 1,762 | $ 1,083 | $ 2,845 |
Severance Costs | |||
Restructuring Cost And Reserve [Line Items] | |||
Balance at December 31, 2019 | 894 | ||
Costs charged to expense | 1,380 | ||
Costs paid or otherwise settled | (2,274) | ||
Balance at December 31, 2020 | $ 894 | ||
Other Associated Costs | |||
Restructuring Cost And Reserve [Line Items] | |||
Costs charged to expense | 208 | ||
Costs paid or otherwise settled | (208) | ||
Duplicate Operating Costs | |||
Restructuring Cost And Reserve [Line Items] | |||
Costs charged to expense | 174 | ||
Costs paid or otherwise settled | $ (174) |
Restructuring - Schedule of Cha
Restructuring - Schedule of Charges by Reportable Segment, Recorded in Restructuring Costs Under Operating Expenses in Consolidated Statements of Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | 14 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | |
Restructuring Cost And Reserve [Line Items] | |||
Total | $ 1,762 | $ 1,083 | $ 2,845 |
Breast Products | |||
Restructuring Cost And Reserve [Line Items] | |||
Total | 390 | 499 | 889 |
miraDry | |||
Restructuring Cost And Reserve [Line Items] | |||
Total | $ 1,372 | $ 584 | $ 1,956 |
Acquisitions (Details)
Acquisitions (Details) - Vesta Intermediate Funding, Inc - USD ($) $ in Thousands | Nov. 07, 2023 | Nov. 07, 2019 | Dec. 31, 2019 | Nov. 07, 2021 |
Business Acquisition [Line Items] | ||||
Payment to acquire business | $ 14,000 | |||
Purchase price for additional inventory purchase | 5,113 | |||
Fair value of consideration transferred | $ 27,006 | |||
Purchase price for additional inventory funded amount | $ 3,900 | |||
Intellectual Property | ||||
Business Acquisition [Line Items] | ||||
Estimated useful life | 19 years | |||
Percentage of benefit realized using accelerated method | 95.00% | |||
Accrued and Other Current Liabilities | ||||
Business Acquisition [Line Items] | ||||
Purchase price for additional inventory remaining amount | 1,200 | |||
General & administrative expense | ||||
Business Acquisition [Line Items] | ||||
Professional fees | $ 2,600 | |||
Scenario Forecast | ||||
Business Acquisition [Line Items] | ||||
Contingent consideration liability | $ 3,000 | $ 3,200 | ||
Scenario Forecast | First Milestone Price Target | ||||
Business Acquisition [Line Items] | ||||
Stock issued during period, shares | 303,721 | |||
Number of days within which additional shares will be issued | 5 days | |||
Scenario Forecast | Second Milestone Price Target | ||||
Business Acquisition [Line Items] | ||||
Stock issued during period, shares | 303,721 | |||
Number of days within which additional shares will be issued | 5 days |
Acquisitions - Schedule of Aggr
Acquisitions - Schedule of Aggregate Preliminary Acquisition Date Fair Value of Consideration Transferred (Details) - Vesta Intermediate Funding, Inc $ in Thousands | Nov. 07, 2019USD ($) |
Business Acquisition [Line Items] | |
Cash consideration at Acquisition Date | $ 14,000 |
Deferred consideration | 4,737 |
Equity contingent consideration | 3,156 |
Purchase price for additional inventory purchase | 5,113 |
Total purchase consideration | $ 27,006 |
Acquisitions - Schedule of Allo
Acquisitions - Schedule of Allocation of the Fair Value of the Consideration Transferred by Major Class (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | Nov. 07, 2019 | Dec. 31, 2018 |
Fair value of the assets acquired | ||||
Goodwill | $ 9,202 | $ 9,202 | $ 26,785 | |
Vesta Intermediate Funding, Inc | ||||
Fair value of the assets acquired | ||||
Inventories | $ 7,138 | |||
Property and equipment | 7,304 | |||
Goodwill | 4,324 | |||
Intangible assets | 8,240 | |||
Liabilities assumed: | ||||
Net assets acquired | $ 27,006 |
Balance Sheet Components (Inven
Balance Sheet Components (Inventories) (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Inventory [Line Items] | ||
Raw materials | $ 7,138 | $ 8,095 |
Work in progress | 12,303 | 5,543 |
Finished goods | 25,791 | 23,893 |
Finished goods - right of return | 3,416 | 2,081 |
Inventory, net | 48,648 | 39,612 |
Breast Products | ||
Inventory [Line Items] | ||
Inventory held on consignment at doctors' offices, clinics, and hospitals | $ 5,700 | $ 2,700 |
Balance Sheet Components (PPE)
Balance Sheet Components (PPE) (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Nov. 07, 2019 | |
Property Plant And Equipment [Line Items] | ||||
Property and equipment, gross | $ 19,828,000 | $ 16,123,000 | ||
Less accumulated depreciation | (6,722,000) | (3,809,000) | ||
Property and equipment, net | 13,106,000 | 12,314,000 | ||
Depreciation expense | 2,500,000 | 1,200,000 | $ 1,100,000 | |
Impairments | 0 | 0 | $ 0 | |
Vesta Intermediate Funding, Inc | ||||
Property Plant And Equipment [Line Items] | ||||
Fixed assets acquired | $ 7,304,000 | |||
Leasehold improvements | ||||
Property Plant And Equipment [Line Items] | ||||
Property and equipment, gross | 2,857,000 | 2,841,000 | ||
Leasehold improvements | Vesta Intermediate Funding, Inc | ||||
Property Plant And Equipment [Line Items] | ||||
Fixed assets acquired | 2,400,000 | |||
Manufacturing equipment and toolings | ||||
Property Plant And Equipment [Line Items] | ||||
Property and equipment, gross | 9,289,000 | 8,175,000 | ||
Computer equipment | ||||
Property Plant And Equipment [Line Items] | ||||
Property and equipment, gross | 2,776,000 | 1,250,000 | ||
Software | ||||
Property Plant And Equipment [Line Items] | ||||
Property and equipment, gross | 3,546,000 | 2,602,000 | ||
Office equipment | ||||
Property Plant And Equipment [Line Items] | ||||
Property and equipment, gross | 167,000 | 111,000 | ||
Furniture and fixtures | ||||
Property Plant And Equipment [Line Items] | ||||
Property and equipment, gross | $ 1,193,000 | $ 1,144,000 | ||
Manufacturing Equipment | Vesta Intermediate Funding, Inc | ||||
Property Plant And Equipment [Line Items] | ||||
Fixed assets acquired | 4,400,000 | |||
Capitalized Software | Vesta Intermediate Funding, Inc | ||||
Property Plant And Equipment [Line Items] | ||||
Fixed assets acquired | $ 500,000 |
Balance Sheet Components (Accru
Balance Sheet Components (Accrued liabilities) (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Accrued and other current liabilities | ||
Payroll and related expenses | $ 3,524 | $ 6,789 |
Accrued severance | 2,900 | 894 |
Accrued commissions | 5,561 | 4,984 |
Accrued manufacturing | 225 | 2,616 |
Deferred and contingent consideration, current portion | 10,146 | 6,830 |
Audit, consulting and legal fees | 48 | 630 |
Accrued sales and marketing expenses | 445 | 1,109 |
Lease liabilities | $ 1,588 | $ 1,299 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | sien:AccruedAndOtherCurrentLiabilitiesMember | sien:AccruedAndOtherCurrentLiabilitiesMember |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible List] | sien:AccruedAndOtherCurrentLiabilitiesMember | sien:AccruedAndOtherCurrentLiabilitiesMember |
Other | $ 7,952 | $ 7,400 |
Total | $ 32,389 | $ 32,551 |
Balance Sheet Components - Sche
Balance Sheet Components - Schedule of rollforward of the accrued warranties (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Balance Sheet Related Disclosures [Abstract] | ||
Beginning Balance | $ 1,562 | $ 1,395 |
Warranty costs incurred during the period | (832) | (762) |
Changes in accrual related to warranties issued during the period | 1,200 | 1,138 |
Changes in accrual related to pre-existing warranties | 71 | (209) |
Ending Balance | $ 2,001 | $ 1,562 |
Balance Sheet Components (Acc_2
Balance Sheet Components (Accrued Warranties) (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Product Warranty Liability [Line Items] | |||
Replacement implants and revision surgery financial assistance under limited warranty program | $ 2,001 | $ 1,562 | $ 1,395 |
Warranty Reserve and Other Long-term Liabilities | |||
Product Warranty Liability [Line Items] | |||
Replacement implants and revision surgery financial assistance under limited warranty program | 1,900 | 1,400 | |
Accrued and Other Current Liabilities | |||
Product Warranty Liability [Line Items] | |||
Replacement implants and revision surgery financial assistance under limited warranty program | $ 100 | $ 200 |
Balance Sheet Components (Liabi
Balance Sheet Components (Liabilities measured at fair value) (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Estimated Dividend Yield | |
Fair Value Measurements | |
Measurement input | 0 |
Measurement Input, Discount Rate | BIOCORNEUM | Future Royalty Payments | |
Fair Value Measurements | |
Fair value measurement discount rate | 21.00% |
Measurement Input, Discount Rate | miraDry | Future Milestone Payments | |
Fair Value Measurements | |
Fair value measurement discount rate | 11.20% |
Balance Sheet Components - Sc_2
Balance Sheet Components - Schedule of Company's Liabilities that are Measured at Fair Value on a Recurring Basis (Details) - Recurring - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Fair Value Measurements | ||
Fair value liability | $ 33,596 | $ 6,929 |
Warrants | ||
Fair Value Measurements | ||
Fair value liability | 38 | |
Contingent Consideration Liability | ||
Fair Value Measurements | ||
Fair value liability | 7,026 | 6,891 |
Derivative Liability | ||
Fair Value Measurements | ||
Fair value liability | 26,570 | |
Level 3 | ||
Fair Value Measurements | ||
Fair value liability | 33,596 | 6,929 |
Level 3 | Warrants | ||
Fair Value Measurements | ||
Fair value liability | 38 | |
Level 3 | Contingent Consideration Liability | ||
Fair Value Measurements | ||
Fair value liability | 7,026 | $ 6,891 |
Level 3 | Derivative Liability | ||
Fair Value Measurements | ||
Fair value liability | $ 26,570 |
Balance Sheet Components - Sc_3
Balance Sheet Components - Schedule of Aggregate Fair Values of Company's Liabilities for which Fair Value is Determined by Level 3 Inputs (Details) - Level 3 - Recurring $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Warrants | |
Fair Value Measurements | |
Balance at beginning of the period | $ 38 |
Change in fair value | (38) |
Contingent Consideration Liability | |
Fair Value Measurements | |
Balance at beginning of the period | 6,891 |
Change in fair value | 135 |
Balance at the end of the period | 7,026 |
Derivative Liability | |
Fair Value Measurements | |
Additions | 16,100 |
Change in fair value | 10,470 |
Balance at the end of the period | $ 26,570 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets, net (Details) | 3 Months Ended | 12 Months Ended | ||
Jun. 30, 2019USD ($) | Dec. 31, 2020USD ($)ReportingUnit | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | |
Finite Lived Intangible Assets [Line Items] | ||||
Number of reporting units | ReportingUnit | 2 | |||
Goodwill impairment charge | $ 0 | |||
Non-cash impairment charges | $ 6,432,000 | $ 12,674,000 | ||
Other intangible assets | ||||
Amortization expense | 1,600,000 | $ 2,300,000 | 2,300,000 | |
Customer relationships | ||||
Finite Lived Intangible Assets [Line Items] | ||||
Non-cash impairment charges | $ 400,000 | 3,900,000 | ||
Distributor relationships | ||||
Finite Lived Intangible Assets [Line Items] | ||||
Non-cash impairment charges | 300,000 | |||
Trade name | ||||
Finite Lived Intangible Assets [Line Items] | ||||
Non-cash impairment charges | 3,300,000 | 1,100,000 | ||
Developed technology | ||||
Finite Lived Intangible Assets [Line Items] | ||||
Non-cash impairment charges | 1,000,000 | 1,400,000 | ||
miraDry | ||||
Finite Lived Intangible Assets [Line Items] | ||||
Goodwill impairment charge | $ 7,600,000 | $ 0 | ||
Breast Products | ||||
Finite Lived Intangible Assets [Line Items] | ||||
Goodwill impairment charge | 0 | |||
Non-cash impairment charges | $ 0 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets, net - Schedule of Changes in Carrying Amount of Goodwill (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Goodwill and intangible assets | |
Goodwill, beginning balance | $ 26,785 |
Accumulated impairment losses | (21,907) |
Goodwill acquired | 4,324 |
Goodwill, ending balance | 9,202 |
Breast Products | |
Goodwill and intangible assets | |
Goodwill, beginning balance | 19,156 |
Accumulated impairment losses | (14,278) |
Goodwill acquired | 4,324 |
Goodwill, ending balance | 9,202 |
miraDry | |
Goodwill and intangible assets | |
Goodwill, beginning balance | 7,629 |
Accumulated impairment losses | $ (7,629) |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets, net - Components of Other Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Other intangible assets | ||
Gross Carrying Amount | $ 16,443 | $ 23,743 |
Accumulated Amortization | (7,506) | (6,803) |
Intangible Assets, net | 8,937 | 16,940 |
Indefinite-lived intangible assets | 450 | 450 |
Trade name | ||
Other intangible assets | ||
Indefinite-lived intangible assets | $ 450 | $ 450 |
Customer relationships | ||
Other intangible assets | ||
Average Amortization Period | 10 years | 11 years |
Gross Carrying Amount | $ 4,940 | $ 9,540 |
Accumulated Amortization | (3,856) | (3,846) |
Intangible Assets, net | $ 1,084 | $ 5,694 |
Trade name | ||
Other intangible assets | ||
Average Amortization Period | 12 years | 14 years |
Gross Carrying Amount | $ 800 | $ 2,000 |
Accumulated Amortization | (322) | (292) |
Intangible Assets, net | $ 478 | $ 1,708 |
Non-compete agreement | ||
Other intangible assets | ||
Average Amortization Period | 2 years | 2 years |
Gross Carrying Amount | $ 80 | $ 80 |
Accumulated Amortization | $ (80) | $ (80) |
Regulatory approvals | ||
Other intangible assets | ||
Average Amortization Period | 1 year | 1 year |
Gross Carrying Amount | $ 670 | $ 670 |
Accumulated Amortization | $ (670) | $ (670) |
Acquired FDA non-gel product approval | ||
Other intangible assets | ||
Average Amortization Period | 11 years | 11 years |
Gross Carrying Amount | $ 1,713 | $ 1,713 |
Accumulated Amortization | $ (1,713) | $ (1,713) |
Manufacturing know-how | ||
Other intangible assets | ||
Average Amortization Period | 19 years | 19 years |
Gross Carrying Amount | $ 8,240 | $ 8,240 |
Accumulated Amortization | (865) | (118) |
Intangible Assets, net | $ 7,375 | $ 8,122 |
Developed technology | ||
Other intangible assets | ||
Average Amortization Period | 13 years | |
Gross Carrying Amount | $ 1,500 | |
Accumulated Amortization | (84) | |
Intangible Assets, net | $ 1,416 |
Goodwill and Other Intangible_6
Goodwill and Other Intangible Assets, net - Schedule of Estimated Amortization Expense (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Estimated amortization expense | |
2021 | $ 1,221 |
2022 | 1,163 |
2023 | 1,092 |
2024 | 948 |
2025 | 805 |
Thereafter | 3,708 |
Total amortization | $ 8,937 |
Leases - Components of Lease Ex
Leases - Components of Lease Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Lessee Lease Description [Line Items] | ||
Total operating lease cost | $ 2,186 | $ 5,756 |
Finance lease cost | ||
Total finance lease cost | 87 | 45 |
Total lease cost | 2,273 | 16,369 |
Inventory | ||
Lessee Lease Description [Line Items] | ||
Total operating lease cost | 488 | 4,206 |
Finance lease cost | ||
Amortization of right-of-use assets | 36 | |
Variable lease cost | 10,568 | |
Operating Expenses | ||
Lessee Lease Description [Line Items] | ||
Total operating lease cost | 1,698 | 1,550 |
Finance lease cost | ||
Amortization of right-of-use assets | 41 | 41 |
Other Income (Expense), Net | ||
Finance lease cost | ||
Interest on lease liabilities | $ 10 | $ 4 |
Leases (Details)
Leases (Details) | 3 Months Ended |
Dec. 31, 2019OperatingLease | |
Lessee Disclosure [Abstract] | |
Renewal term of lease | 4 years |
Number of operating lease, renewable | 1 |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information Related to Operating and Finance Leases (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Cash paid for amounts included in the measurement of lease liabilities: | ||
Operating cash outflows from operating leases | $ 1,758 | $ 5,419 |
Operating cash outflows from finance leases | 85 | 44 |
Right-of-use assets obtained in exchange for lease obligations: | ||
Operating leases | 1,242 | 8,667 |
Finance leases | $ 157 | $ 117 |
Leases - Supplemental Balance S
Leases - Supplemental Balance Sheet Information Related to Operating and Finance Leases (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Assets And Liabilities Lessee [Abstract] | ||
Operating lease right-of-use assets | $ 7,176 | $ 7,494 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | us-gaap:OtherAssetsMember | us-gaap:OtherAssetsMember |
Finance lease right-of-use assets | $ 158 | $ 78 |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | us-gaap:OtherAssetsMember | us-gaap:OtherAssetsMember |
Total right-of use assets | $ 7,334 | $ 7,572 |
Operating lease liabilities | $ 1,504 | $ 1,259 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | sien:AccruedAndOtherCurrentLiabilitiesMember | sien:AccruedAndOtherCurrentLiabilitiesMember |
Finance lease liabilities | $ 84 | $ 40 |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible List] | sien:AccruedAndOtherCurrentLiabilitiesMember | sien:AccruedAndOtherCurrentLiabilitiesMember |
Operating lease liabilities | $ 5,946 | $ 6,434 |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | sien:WarrantyReserveAndOtherLongTermLiabilitiesMember | sien:WarrantyReserveAndOtherLongTermLiabilitiesMember |
Finance lease liabilities | $ 77 | $ 35 |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | sien:WarrantyReserveAndOtherLongTermLiabilitiesMember | sien:WarrantyReserveAndOtherLongTermLiabilitiesMember |
Total lease liabilities | $ 7,611 | $ 7,768 |
Weighted average remaining lease term (years) | ||
Operating leases | 5 years | 5 years |
Finance leases | 2 years | 2 years |
Weighted average discount rate | ||
Operating leases | 7.75% | 7.45% |
Finance leases | 6.15% | 4.06% |
Leases - Maturities of Operatin
Leases - Maturities of Operating and Finance Lease Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Operating Lease Liabilities, Payments Due [Abstract] | ||
Operating leases, 2021 | $ 2,095 | |
Operating leases, 2022 | 1,920 | |
Operating leases, 2023 | 1,968 | |
Operating leases, 2024 | 1,507 | |
Operating leases, 2025 | 579 | |
Operating leases, 2026 and thereafter | 955 | |
Total operating lease payments | 9,024 | |
Less imputed interest, Operating leases | 1,574 | |
Total operating lease liabilities | 7,450 | |
Finance Lease Liabilities, Payments, Due [Abstract] | ||
Finance leases, 2021 | 89 | |
Finance leases, 2022 | 53 | |
Finance leases, 2023 | 28 | |
Finance leases, 2024 | 1 | |
Total finance lease payments | 171 | |
Less imputed interest, Finance leases | 10 | |
Total finance lease liabilities | 161 | |
Lessee Lease Liability Payments Due [Abstract] | ||
2021 | 2,184 | |
2022 | 1,973 | |
2023 | 1,996 | |
2024 | 1,508 | |
2025 | 579 | |
2026 and thereafter | 955 | |
Total lease payments | 9,195 | |
Less imputed interest | 1,584 | |
Total lease liabilities | $ 7,611 | $ 7,768 |
Debt (Details)
Debt (Details) | Feb. 05, 2021USD ($)Tranche | May 11, 2020USD ($) | Apr. 20, 2020USD ($) | Mar. 11, 2020USD ($)$ / shares | Nov. 07, 2019 | Jul. 01, 2019USD ($) | Jul. 25, 2017 | Apr. 20, 2020USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Jul. 01, 2022USD ($) | Jul. 01, 2021USD ($) | Jul. 01, 2020 | May 10, 2020USD ($) |
Line Of Credit Facility [Line Items] | |||||||||||||||
Term loan credit and security agreement entered date | Jul. 25, 2017 | ||||||||||||||
Current portion of long-term debt | $ 4,670,000 | $ 6,508,000 | |||||||||||||
Borrowing base of finished goods inventory (as a percent) | 40.00% | ||||||||||||||
Borrowing base availability from finished goods inventory (as a percent) | 20.00% | ||||||||||||||
Additional interest (as a percent) | 5.00% | ||||||||||||||
Fair value of derivative liability | 26,570,000 | ||||||||||||||
Amortization of debt issuance costs and discounts | 4,347,000 | 359,000 | $ 174,000 | ||||||||||||
Long-term debt | $ 60,500,000 | 38,248,000 | |||||||||||||
Paycheck Protection Program | |||||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||||
Debt maturity date | Apr. 20, 2022 | Apr. 20, 2022 | |||||||||||||
Debt instrument interest rate | 1.00% | 1.00% | |||||||||||||
Debt instrument principal | $ 6,700,000 | $ 6,700,000 | |||||||||||||
Debt instrument, payment terms | Company will make no payments until the date which forgiveness of the PPP Loan is determined, which can be up to 10 months following the end of the covered period (which is defined as 24 weeks from the date of the loan), or the Deferral Period. Commencing one month after the expiration of the Deferral Period, and continuing on the same day of each month until the Maturity Date, the Company will pay to Lender monthly payments of principal and interest, in an amount required to fully amortize the principal amount outstanding on the PPP Loan on the last day of the Deferral Period by the Maturity Date. | ||||||||||||||
Salary amount which loan forgiven | $ 100,000 | ||||||||||||||
Convertible Note | |||||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||||
Carrying Value | $ 44,436,000 | ||||||||||||||
Maximum | Paycheck Protection Program | |||||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||||
Percentage of forgiven amount for non-payroll costs | 40.00% | ||||||||||||||
Minimum | Paycheck Protection Program | |||||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||||
Percentage of salary reduction | 25.00% | ||||||||||||||
Long-term Debt | Paycheck Protection Program | |||||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||||
Current portion of long-term debt | 3,300,000 | ||||||||||||||
Long-term debt | 3,300,000 | ||||||||||||||
Term Loan Credit and Security Agreement and Revolving Loan Credit and Security Agreement | |||||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||||
Agreements amended and restated date | Jul. 1, 2019 | ||||||||||||||
Restated Term Loan Agreement | |||||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||||
Agreements amended date | Nov. 7, 2019 | ||||||||||||||
Line of credit facility, remaining borrowing capacity | $ 35,000,000 | 10,000,000 | |||||||||||||
Debt maturity date | Jul. 1, 2024 | ||||||||||||||
Exit fee percentage to aggregate amount of all term loans funded | 5.00% | ||||||||||||||
Periodic commitment amount | $ 15,000,000 | ||||||||||||||
Loan amount outstanding | 15,000,000 | ||||||||||||||
Loan amount outstanding, long term debt | 12,900,000 | ||||||||||||||
Loan amount outstanding, long term debt current | 2,100,000 | ||||||||||||||
Unamortized debt issuance costs | 900,000 | ||||||||||||||
Current portion of long-term debt | 700,000 | ||||||||||||||
Line of credit exit fee payables | 800,000 | ||||||||||||||
Restated Term Loan Agreement | Subsequent Event | |||||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||||
Line of credit facility, remaining borrowing capacity | $ 15,000,000 | ||||||||||||||
Periodic commitment amount | $ 1,000,000 | ||||||||||||||
Unfunded tranche revised number | Tranche | 2 | ||||||||||||||
Debt instrument amendment fee | $ 750,000 | ||||||||||||||
Restated Term Loan Agreement | Tranche 4 | Scenario Forecast | |||||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||||
Periodic commitment amount | $ 5,000,000 | ||||||||||||||
Restated Term Loan Agreement | Tranche 5 | Scenario Forecast | |||||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||||
Periodic commitment amount | $ 5,000,000 | ||||||||||||||
Restated Term Loan Agreement | London Interbank Offered Rate (LIBOR) | |||||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||||
Spread on variable rate basis (as a percent) | 7.50% | ||||||||||||||
Additional Term Loan | |||||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||||
Line of credit facility, remaining borrowing capacity | $ 5,000,000 | 15,000,000 | |||||||||||||
Minimum revenue required to satisfy additional term loan facility | $ 100,000,000 | ||||||||||||||
Term Amendment | |||||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||||
Prepaid principal amount | 25,000,000 | ||||||||||||||
Accrued interest prepaid | 100,000 | ||||||||||||||
Prepaid exit fee | 1,250,000 | ||||||||||||||
Minimum unrestricted cash amount | 5,000,000 | $ 20,000,000 | |||||||||||||
Term Amendment | Tranche 3 | |||||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||||
Minimum revenue required to satisfy additional term loan facility | 30,000,000 | ||||||||||||||
Periodic commitment amount | $ 15,000,000 | $ 10,000,000 | |||||||||||||
Revolving Loan | |||||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||||
Debt maturity date | Jul. 1, 2024 | ||||||||||||||
Loan amount outstanding | 0 | ||||||||||||||
Borrowing base of accounts receivable (as a percent) | 85.00% | ||||||||||||||
Loan amount available | 2,900,000 | ||||||||||||||
Revolving Loan | Maximum | |||||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||||
Loan amount outstanding | $ 10,000,000 | ||||||||||||||
Revolving Loan | Other Assets | |||||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||||
Unamortized debt issuance costs | 100,000 | ||||||||||||||
Revolving Loan | London Interbank Offered Rate (LIBOR) | |||||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||||
Spread on variable rate basis (as a percent) | 4.50% | ||||||||||||||
Term Loan and Revolving Loan | |||||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||||
Amortization of debt issuance costs | $ 900,000 | $ 400,000 | $ 200,000 | ||||||||||||
Deerfield Facility Agreement | |||||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||||
Debt instrument interest rate | 4.00% | ||||||||||||||
Debt instrument principal | $ 60,000,000 | ||||||||||||||
Deerfield Facility Agreement | Convertible Note | |||||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||||
Term loan credit and security agreement entered date | Mar. 11, 2020 | ||||||||||||||
Debt maturity date | Mar. 11, 2025 | ||||||||||||||
Carrying Value | $ 60,000,000 | ||||||||||||||
Debt instrument interest rate | 4.00% | 12.00% | 4.00% | ||||||||||||
Debt instrument conversion rate per principal amount | 14,634 | ||||||||||||||
Debt instrument principal amount per conversion unit | $ 1,000 | ||||||||||||||
Debt instrument conversion price | $ / shares | $ 4.10 | ||||||||||||||
Debt instrument principal | $ 60,000,000 | ||||||||||||||
Minimum percentage of number of shares of common stock owned by conversion of debt instrument | 4.985% | ||||||||||||||
Minimum percentage of change in ownership percentage entitling lender to demand repayment of all outstanding debt | 50.00% | ||||||||||||||
Debt instrument, call feature | Deerfield has the option to demand repayment of all outstanding principal, and any unpaid interest accrued thereon, in connection with a Major Transaction (as defined in the Convertible Note), which shall include, among others, any acquisition or other change of control of the Company; the sale or transfer of assets of the Company equal to more than 50% of the Enterprise Value (as defined in the Convertible Note) of the Company; a liquidation, bankruptcy or other dissolution of the Company; or if at any time shares of the Company’s common stock are not listed on an Eligible Market (as defined in the Convertible Note). The Convertible Note is subject to specified events of default, the occurrence of which would entitle Deerfield to immediately demand repayment of all outstanding principal and accrued interest on the Convertible Note. Such events of default include, among others, failure to make any payment under the Convertible Note when due, failure to observe or perform any covenant under the Deerfield Facility Agreement or the other transaction documents related thereto (subject to a standard cure period), the failure of the Company to be able to pay debts as they come due, the commencement of bankruptcy or insolvency proceedings against the Company, a material judgement levied against the Company and a material default by the Company under the Convertible Note. | ||||||||||||||
Embedded derivative liability | $ 16,100,000 | ||||||||||||||
Fair value of derivative liability | 26,600,000 | ||||||||||||||
Debt discount on initial embedded derivative liability | $ 16,100,000 | ||||||||||||||
Debt issuance costs | $ 1,500,000 | ||||||||||||||
Unamortized debt discount and issuance costs | 15,600,000 | ||||||||||||||
Amortization of debt issuance costs and discounts | $ 2,200,000 | ||||||||||||||
Amended and restated credit and security agreement date | Jul. 1, 2019 |
Debt (Schedule of Future Princi
Debt (Schedule of Future Principal and Exit Fee Payments of Outstanding Debt) (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Debt Disclosure [Abstract] | |
2021 | $ 5,409 |
2022 | 8,326 |
2023 | 5,000 |
2024 | 3,667 |
2025 | 60,000 |
Total | $ 82,402 |
Income Taxes - Schedule of Prov
Income Taxes - Schedule of Provision for Income Tax (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |||
Federal | $ 12 | $ 9 | $ 2 |
State | 10 | 9 | (10) |
Foreign | 11 | 16 | 4 |
Income tax (benefit) expense | $ 33 | $ 34 | $ (4) |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Statutory federal income tax rate | |||
Statutory federal income tax rate (as a percent) | 21.00% | 21.00% | 21.00% |
Deferred tax assets: | |||
Valuation allowance against deferred tax assets | $ 131,309,000 | $ 115,307,000 | |
Tax Credit Carryforwards | |||
Unrecognized tax benefits | 619,000 | $ 1,116,000 | $ 1,076,000 |
Impact of unrecognized tax benefit on financial statements | 0 | ||
Unrecognized Tax Benefits Penalties and Interest | |||
Interest expense or penalties related to unrecognized tax benefits | 0 | ||
Research and development | |||
Tax Credit Carryforwards | |||
Unrecognized tax benefits | 600,000 | ||
Federal | |||
Deferred tax assets: | |||
Net operating loss carryforwards | 445,100,000 | ||
Net operating loss carryforwards, not subject to expiration | $ 217,400,000 | ||
Net operating loss carryforwards, expiration year | 2027 | ||
Federal | Minimum [Member] | |||
Income Tax Uncertainties [Abstract] | |||
Tax years | 2017 | ||
Federal | Maximum | |||
Income Tax Uncertainties [Abstract] | |||
Tax years | 2019 | ||
Federal | Research and development | |||
Tax Credit Carryforwards | |||
Tax credit carryforwards | $ 30,000 | ||
Tax credit carryforwards, expiration year | 2029 | ||
Unrecognized tax benefit decreased amount | $ 500,000 | ||
State | |||
Deferred tax assets: | |||
Net operating loss carryforwards | 306,200,000 | ||
Net operating loss carryforwards, not subject to expiration | $ 26,200,000 | ||
Net operating loss carryforwards, expiration year | 2021 | ||
State | Minimum [Member] | |||
Income Tax Uncertainties [Abstract] | |||
Tax years | 2016 | ||
State | Maximum | |||
Income Tax Uncertainties [Abstract] | |||
Tax years | 2019 | ||
State | Research and development | |||
Tax Credit Carryforwards | |||
Tax credit carryforwards | $ 2,700,000 |
Income Taxes - Schedule of Reco
Income Taxes - Schedule of Reconciliation of Actual Income Tax Expense Obtained by Applying Statutory Federal Income Tax Rate (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Reconciliation of actual income tax expense obtained by applying the statutory federal income tax rate | |||
Tax at federal statutory rate | $ (18,882) | $ (22,424) | $ (17,353) |
State, net of federal benefit | (2,372) | (2,109) | (5,999) |
Permanent items | 2,282 | 857 | 338 |
Benefit state rate change | 20 | 337 | 60 |
Other | 2,984 | 368 | (103) |
Goodwill impairment | 1,602 | ||
Change in valuation allowance | 16,001 | 21,403 | 23,053 |
Income tax (benefit) expense | $ 33 | $ 34 | $ (4) |
Income Taxes - Schedule of Tax
Income Taxes - Schedule of Tax Effects of Temporary Differences and Carryforwards that Give Rise to Significant Portions of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred tax assets and liabilities | ||
Net operating loss carryforwards | $ 113,374 | $ 99,759 |
Research and development credits | 2,121 | 3,626 |
Lease liabilities | 1,861 | 1,902 |
Derivative liability | 6,495 | |
Accruals and reserves | 10,175 | 9,636 |
Intangibles | 3,053 | 5,330 |
Gross deferred tax assets | 137,079 | 120,253 |
Less valuation allowance | (131,309) | (115,307) |
Total deferred tax assets | 5,770 | 4,946 |
Depreciation | (276) | (40) |
Convertible debt discount | (3,440) | |
Right-of-use assets | (1,793) | (1,854) |
Intangibles - deferred tax liability | (333) | (3,102) |
Total deferred tax liabilities | (5,842) | (4,996) |
Net deferred taxes | $ (72) | $ (50) |
Income Taxes - Schedule of Re_2
Income Taxes - Schedule of Reconciliation of Beginning and Ending Amount of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Reconciliation of the beginning and ending amount of unrecognized tax benefits | ||
Balance at beginning of the period | $ 1,116 | $ 1,076 |
Additions based on tax positions taken in the current year | 10 | 40 |
Decreases based on tax positions taken in the prior year | (507) | |
Balance at end of the period | $ 619 | $ 1,116 |
Employee Benefit Plans (Details
Employee Benefit Plans (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Compensation And Retirement Disclosure [Abstract] | |||
Company contribution (as a percent) | 3.00% | ||
Company contribution | $ 0.7 | $ 0.7 | $ 0.7 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - $ / shares | Dec. 31, 2020 | Dec. 31, 2019 |
Stock other disclosures | ||
Common and preferred stock, shares authorized | 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 | Dec. 31, 2020 |
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 | |||
Common Stock Warrants | |||
Aggregate number of common shares to purchase | 17,040 | ||
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 | 12 Months Ended | |||||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2020 | Nov. 03, 2014 | Apr. 30, 2007 | |
Stock options | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Balance at the end of the period (in shares) | 1,959,501 | 1,880,846 | 1,953,334 | 1,959,501 | ||
Number of options | ||||||
Balance at the beginning of period (in shares) | 1,880,846 | 1,953,334 | ||||
Options exercised (in shares) | (9,817) | (51,451) | ||||
Options forfeited (in shares) | (511,528) | (21,037) | ||||
Balance at the end of the period (in shares) | 1,959,501 | 1,880,846 | 1,953,334 | |||
Options granted (in shares) | 600,000 | 0 | 0 | |||
Number of options vested and expected to vest (in shares) | 1,959,501 | |||||
Number of options vested and exercisable (in shares) | 1,359,558 | |||||
Weighted average exercise price | ||||||
Balance at the beginning of period (in dollars per share) | $ 7.42 | $ 7.42 | ||||
Options exercised (in dollars per share) | 2.89 | 2.44 | ||||
Options forfeited (in dollars per share) | 8.87 | 19.39 | ||||
Balance at the end of period (in dollars per share) | 4.79 | $ 7.42 | $ 7.42 | |||
Options granted (in dollars per share) | $ 3.58 | |||||
Additional information | ||||||
Weighted average remaining contractual term | 5 years 11 months 1 day | 5 years 5 months 23 days | 6 years 3 months 18 days | |||
Weighted average remaining contractual term, vested and exercisable | 8 years 6 months 10 days | |||||
Options granted (in shares) | 600,000 | 0 | 0 | |||
Weighted average grant date fair value (in dollars per share) | $ 3.58 | |||||
Stock-based compensation expense | $ 0.1 | $ 0.6 | $ 1.6 | |||
Number of years from the date of grant for tax benefits | 2 years | |||||
Number of years from the date of exercise for tax benefits | 1 year | |||||
Unrecognized compensation costs (in dollars) | $ 2.1 | |||||
Aggregate intrinsic value (in dollars) | $ 14,000 | $ 0.6 | $ 2 | |||
Stock Option | ||||||
Assumptions used to estimate the fair value of stock options | ||||||
Expected term (in years) | 10 years 3 days | |||||
Expected volatility | 82.65% | |||||
Risk-free interest rate | 0.27% | |||||
2007 Plan | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Common stock reserved for issuance (in shares) | 1,690,448,000 | |||||
Balance at the end of the period (in shares) | 269,295,000 | 269,295,000 | ||||
Number of shares available for future grants | 0 | |||||
Number of options | ||||||
Balance at the end of the period (in shares) | 269,295,000 | |||||
2014 Plan | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Common stock reserved for issuance (in shares) | 6,692,279,000 | 1,027,500,000 | ||||
Number of shares available for future grants | 299,947,000 | |||||
Inducement Plan | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Number of shares available for future grants | 937,591,000 | |||||
Number of shares awarded | 1,476,106,000 | |||||
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 [Member] | ||||||
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 [Member] | 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 [Member] | ||||||
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% | |||||
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 | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Stockholders' Equity, other disclosures | |||
Requisite service period, annually | 3 years | ||
Granted | $ 4.77 | $ 8.02 | $ 14.38 |
Stock-based compensation expense | $ 7.5 | $ 11.3 | $ 11.7 |
Unrecognized compensation costs (in dollars) | $ 11.5 | ||
Weighted average period over which unrecognized compensation costs are expected to be recognized | 1 year 10 months 17 days | ||
Number of shares | |||
Balance at beginning of the period | 2,232,956 | 2,141,350 | |
Granted | 3,070,430 | 1,407,768 | |
Vested | (1,150,707) | (944,467) | |
Forfeited | (1,058,889) | (371,695) | |
Balance at end of the period | 3,093,790 | 2,232,956 | 2,141,350 |
Weighted average grant date fair value | |||
Balance at beginning of the period | $ 11.99 | $ 13.27 | |
Granted | 4.77 | 8.02 | $ 14.38 |
Vested | 10.06 | 10.56 | |
Forfeited | 7.82 | 7.99 | |
Balance at end of the period | $ 6.97 | $ 11.99 | $ 13.27 |
Stockholders' Equity (Stock Pur
Stockholders' Equity (Stock Purchase) (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Oct. 31, 2014 | |
Employee Stock Purchase Plan | ||||
Assumptions used to estimate the fair value of stock options | ||||
Expected volatility, minimum (as a percent) | 68.00% | 69.00% | 36.00% | |
Expected volatility, maximum (as a percent) | 139.00% | 77.00% | 42.00% | |
Risk-free interest rate, minimum (as a percent) | 0.14% | 1.87% | 1.27% | |
Risk-free interest rate, maximum (as a percent) | 1.57% | 2.06% | 3.03% | |
Employee Stock Purchase Plan | Minimum | ||||
Assumptions used to estimate the fair value of stock options | ||||
Expected term (in years) | 6 months | 6 months | 6 months | |
Employee Stock Purchase Plan | Maximum | ||||
Assumptions used to estimate the fair value of stock options | ||||
Expected term (in years) | 2 years | 2 years | 2 years | |
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% | |||
Number of shares reserved for future issuance | 1,746,258 | |||
Rate of increase in the number of shares available for grant every year on outstanding common stock (as a percent) | 1.00% | |||
Number of shares available for future grants | 946,292 | |||
Purchases under the award | 203,728 | 175,624 | ||
Weighted Average purchase price | $ 4.11 | $ 6.93 | ||
Stock-based compensation expense | $ 600,000 | $ 800,000 | $ 600,000 | |
Incremental compensation cost | $ 0 | $ 0 | $ 0 | |
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 | |||
Number of shares available for future grants | 3,000,000 |
Segment Reporting and Geograp_3
Segment Reporting and Geographic Information (Details) | 12 Months Ended |
Dec. 31, 2020USD ($)Segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | Segment | 2 |
Segments unallocated expenses | $ | $ 0 |
Segment Reporting and Geograp_4
Segment Reporting and Geographic Information - Summary of Net Sales and Net Operating Loss by Reportable Segment (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Segment Reporting Information [Line Items] | |||||||||||
Total net sales | $ 22,644 | $ 19,217 | $ 12,448 | $ 16,932 | $ 23,210 | $ 22,412 | $ 20,525 | $ 17,552 | $ 71,241 | $ 83,699 | $ 68,126 |
Total loss from operations | (70,310) | (103,567) | (79,774) | ||||||||
Total assets | 168,978 | 204,404 | 168,978 | 204,404 | |||||||
Breast Products | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Total net sales | 54,997 | 46,363 | 37,016 | ||||||||
Total loss from operations | (46,521) | (50,175) | (53,047) | ||||||||
Total assets | 151,059 | 169,613 | 151,059 | 169,613 | |||||||
miraDry | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Total net sales | 16,244 | 37,336 | 31,110 | ||||||||
Total loss from operations | (23,789) | (53,392) | $ (26,727) | ||||||||
Total assets | $ 17,919 | $ 34,791 | $ 17,919 | $ 34,791 |
Segment Reporting and Geograp_5
Segment Reporting and Geographic Information - Summary of Net Sales by Geographical Regions (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Segment Reporting Information [Line Items] | |||||||||||
Net sales | $ 22,644 | $ 19,217 | $ 12,448 | $ 16,932 | $ 23,210 | $ 22,412 | $ 20,525 | $ 17,552 | $ 71,241 | $ 83,699 | $ 68,126 |
North America | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | 58,752 | 62,277 | 49,975 | ||||||||
International | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net sales | $ 12,489 | $ 21,422 | $ 18,151 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) $ in Millions | Nov. 11, 2017 | Mar. 31, 2019 | Dec. 31, 2020 |
Contingencies | |||
Legal settlement paid | $ 0.4 | ||
miraDry Class Action Litigation | |||
Contingencies | |||
Amount of Defendants (and/or their indemnitors and/or insurers) agreed to pay settlement consideration | $ 0.4 | ||
Loss contingency paid | $ 0.4 | ||
Legal settlement | $ 0.6 |
Summary of Quarterly Financia_3
Summary of Quarterly Financial Information (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Selected Quarterly Financial Information [Abstract] | |||||||||||
Net sales | $ 22,644 | $ 19,217 | $ 12,448 | $ 16,932 | $ 23,210 | $ 22,412 | $ 20,525 | $ 17,552 | $ 71,241 | $ 83,699 | $ 68,126 |
Gross profit | 11,075 | 10,826 | 6,898 | 10,140 | 14,239 | 12,658 | 12,712 | 11,078 | 38,939 | 50,687 | 41,304 |
Net loss | $ (21,237) | $ (5,821) | $ (34,277) | $ (28,612) | $ (20,247) | $ (22,433) | $ (37,654) | $ (26,484) | $ (89,947) | $ (106,818) | $ (82,627) |
Net loss per share: | |||||||||||
Basic and diluted | $ (0.42) | $ (0.12) | $ (0.68) | $ (0.57) | $ (0.41) | $ (0.45) | $ (1.10) | $ (0.91) | $ (1.79) | $ (2.63) | $ (3.25) |
Subsequent Events (Details)
Subsequent Events (Details) - Common stock - USD ($) $ / shares in Units, $ in Millions | Feb. 08, 2021 | Jun. 07, 2019 | May 07, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Subsequent Event [Line Items] | ||||||
Stock issued during period, shares | 37,000 | 20,000,000 | 8,518,519 | |||
Underwritten Follow-On Offering | ||||||
Subsequent Event [Line Items] | ||||||
Stock issued during period, shares | 17,391,305 | 7,407,408 | ||||
Public offering price (in dollars per share) | $ 5.75 | $ 13.50 | ||||
Additional shares granted to underwriters | 2,608,695 | 1,111,111 | ||||
Proceeds from the issuance of common stock, net of underwriting discounts, commissions and offering expenses | $ 107.7 | $ 107.6 | ||||
Payment of underwriting discounts and commissions and offering expenses | 6.9 | 6.9 | ||||
Offering expenses | $ 0.4 | $ 0.5 | ||||
Underwritten Follow-On Offering | Subsequent Event | ||||||
Subsequent Event [Line Items] | ||||||
Stock issued during period, shares | 5,410,628 | |||||
Public offering price (in dollars per share) | $ 6.75 | |||||
Additional shares granted to underwriters | 811,594 | |||||
Proceeds from the issuance of common stock, net of underwriting discounts, commissions and offering expenses | $ 39.1 | |||||
Payment of underwriting discounts and commissions and offering expenses | 2.2 | |||||
Offering expenses | $ 0.4 |
Uncategorized Items - sien-10k_
Label | Element | Value |
Breast Product [Member] | ||
Goodwill | us-gaap_Goodwill | $ 9,202,000 |