Cover
Cover - shares | 3 Months Ended | |
Mar. 31, 2024 | Apr. 30, 2024 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2024 | |
Document Transition Report | false | |
Entity File Number | 001-35280 | |
Entity Registrant Name | VERICEL CORPORATION | |
Entity Incorporation, State or Country Code | MI | |
Entity Tax Identification Number | 94-3096597 | |
Entity Address, Address Line One | 64 Sidney Street | |
Entity Address, City or Town | Cambridge | |
Entity Address, State or Province | MA | |
Entity Address, Postal Zip Code | 02139 | |
City Area Code | 617 | |
Local Phone Number | 588-5555 | |
Title of 12(b) Security | Common Stock (No par value) | |
Trading Symbol | VCEL | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 48,601,736 | |
Entity Central Index Key | 0000887359 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Current assets: | ||
Cash and cash equivalents | $ 62,938 | $ 69,088 |
Restricted cash | 7,804 | 17,778 |
Short-term investments | 47,710 | 40,469 |
Accounts receivable (net of allowance for doubtful accounts of $87 and $43, respectively) | 49,934 | 58,356 |
Inventory | 13,557 | 13,087 |
Other current assets | 7,775 | 6,853 |
Total current assets | 189,718 | 205,631 |
Property and equipment, net | 56,392 | 41,635 |
Intangible assets, net | 6,719 | 6,875 |
Right-of-use assets | 73,682 | 73,462 |
Long-term investments | 29,433 | 25,283 |
Other long-term assets | 717 | 771 |
Total assets | 356,661 | 353,657 |
Current liabilities: | ||
Accounts payable | 19,432 | 22,347 |
Accrued expenses | 11,026 | 17,215 |
Current portion of operating lease liabilities | 6,012 | 6,187 |
Total current liabilities | 36,470 | 45,749 |
Operating lease liabilities | 86,141 | 81,856 |
Other long-term liabilities | 154 | 100 |
Total liabilities | 122,765 | 127,705 |
COMMITMENTS AND CONTINGENCIES (Note 12) | ||
Shareholders’ equity: | ||
Common stock, no par value; shares authorized — 75,000; shares issued and outstanding — 48,489 and 47,829, respectively | 641,180 | 629,229 |
Accumulated other comprehensive loss | (245) | (100) |
Accumulated deficit | (407,039) | (403,177) |
Total shareholders’ equity | 233,896 | 225,952 |
Total liabilities and shareholders’ equity | $ 356,661 | $ 353,657 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 87 | $ 43 |
Common stock, shares authorized (in shares) | 75,000,000 | 75,000,000 |
Common stock, shares issued (in shares) | 48,489,000 | 47,829,000 |
Common stock, shares outstanding (in shares) | 48,489,000 | 47,829,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Income Statement [Abstract] | ||
Product sales, net | $ 51,281 | $ 41,017 |
Total revenue | 51,281 | 41,017 |
Cost of product sales | 15,927 | 14,497 |
Gross profit | 35,354 | 26,520 |
Research and development | 6,418 | 5,212 |
Selling, general and administrative | 34,400 | 29,485 |
Total operating expenses | 40,818 | 34,697 |
Loss from operations | (5,464) | (8,177) |
Other income (expense): | ||
Interest income | 1,762 | 839 |
Interest expense | (153) | (145) |
Other expense | (7) | (12) |
Total other income | 1,602 | 682 |
Net loss | $ (3,862) | $ (7,495) |
Net loss per common share: | ||
Basic (in USD per share) | $ (0.08) | $ (0.16) |
Diluted (in USD per share) | $ (0.08) | $ (0.16) |
Weighted-average common shares outstanding: | ||
Basic (in shares) | 48,141 | 47,387 |
Diluted (in shares) | 48,141 | 47,387 |
Revenue, Product and Service [Extensible List] | Product [Member] | Product [Member] |
Cost, Product and Service [Extensible List] | Product [Member] | Product [Member] |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Statement of Comprehensive Income [Abstract] | ||
Net loss | $ (3,862) | $ (7,495) |
Other comprehensive (loss) gain: | ||
Unrealized (loss) gain on investments | (145) | 342 |
Comprehensive loss | $ (4,007) | $ (7,153) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Accumulated Other Comprehensive Gain (Loss) | Accumulated Deficit |
Beginning balance (in shares) at Dec. 31, 2022 | 47,253 | |||
Beginning balance at Dec. 31, 2022 | $ 192,272 | $ 593,245 | $ (978) | $ (399,995) |
Increase (Decrease) in Shareholders' Equity | ||||
Net loss | (7,495) | (7,495) | ||
Stock-based compensation expense | 8,731 | $ 8,731 | ||
Stock option exercises (in shares) | 132 | |||
Stock option exercises | 2,009 | $ 2,009 | ||
Shares issued under the Employee Stock Purchase Plan (in shares) | 11 | |||
Shares issued under the Employee Stock Purchase Plan | 216 | $ 216 | ||
Issuance of stock for restricted stock unit vesting (in shares) | 183 | |||
Restricted stock withheld for employee tax remittance (in shares) | (72) | |||
Restricted stock withheld for employee tax remittance | (2,097) | $ (2,097) | ||
Unrealized (loss) gain on investments | 342 | 342 | ||
Ending balance (in shares) at Mar. 31, 2023 | 47,507 | |||
Ending balance at Mar. 31, 2023 | $ 193,978 | $ 602,104 | (636) | (407,490) |
Beginning balance (in shares) at Dec. 31, 2023 | 47,829 | 47,829 | ||
Beginning balance at Dec. 31, 2023 | $ 225,952 | $ 629,229 | (100) | (403,177) |
Increase (Decrease) in Shareholders' Equity | ||||
Net loss | (3,862) | (3,862) | ||
Stock-based compensation expense | 9,834 | $ 9,834 | ||
Stock option exercises (in shares) | 487 | |||
Stock option exercises | 6,779 | $ 6,779 | ||
Shares issued under the Employee Stock Purchase Plan (in shares) | 9 | |||
Shares issued under the Employee Stock Purchase Plan | 247 | $ 247 | ||
Issuance of stock for restricted stock unit vesting (in shares) | 265 | |||
Restricted stock withheld for employee tax remittance (in shares) | (101) | |||
Restricted stock withheld for employee tax remittance | (4,909) | $ (4,909) | ||
Unrealized (loss) gain on investments | $ (145) | (145) | ||
Ending balance (in shares) at Mar. 31, 2024 | 48,489 | 48,489 | ||
Ending balance at Mar. 31, 2024 | $ 233,896 | $ 641,180 | $ (245) | $ (407,039) |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Operating activities: | ||
Net loss | $ (3,862) | $ (7,495) |
Adjustments to reconcile net loss to net cash flows from operating activities: | ||
Depreciation and amortization expense | 1,378 | 1,158 |
Stock-based compensation expense | 9,834 | 8,731 |
Amortization of premiums and discounts on marketable securities | (102) | (290) |
Amortization of debt issuance costs | 54 | 54 |
Non-cash lease costs | 1,771 | 1,112 |
Other | 7 | 12 |
Changes in operating assets and liabilities: | ||
Inventory | (470) | 616 |
Accounts receivable | 8,422 | 8,180 |
Other current assets | (922) | 263 |
Accounts payable | (4,883) | (274) |
Accrued expenses | (6,198) | (3,079) |
Operating lease liabilities | 2,119 | (1,128) |
Other non-current assets and liabilities, net | 54 | 0 |
Net cash provided by operating activities | 7,202 | 7,860 |
Investing activities: | ||
Purchases of investments | (22,555) | (9,787) |
Sales and maturities of investments | 11,120 | 21,500 |
Expenditures for property and equipment | (14,017) | (1,413) |
Purchases of intangible assets | 0 | (7,500) |
Net cash (used in) provided by investing activities | (25,452) | 2,800 |
Financing activities: | ||
Net proceeds from common stock issuance | 7,026 | 2,225 |
Payments on employee’s behalf for taxes related to vesting of restricted stock unit awards | (4,900) | (2,097) |
Other | 0 | (21) |
Net cash provided by financing activities | 2,126 | 107 |
Net (decrease) increase in cash, cash equivalents, and restricted cash | (16,124) | 10,767 |
Cash, cash equivalents, and restricted cash at beginning of period | 86,866 | 51,067 |
Cash, cash equivalents, and restricted cash at end of period | 70,742 | 61,834 |
Supplemental disclosure of cash flow information: | ||
Right-of-use asset and lease liability recognized | 1,991 | 419 |
Additions to property and equipment included in accounts payable | 12,115 | 2,282 |
Reconciliation to amounts within the condensed consolidated balance sheets: | ||
Cash and cash equivalents | 62,938 | 61,834 |
Restricted cash | 7,804 | 0 |
Total cash, cash equivalents, and restricted cash at end of period | $ 70,742 | $ 61,834 |
Organization
Organization | 3 Months Ended |
Mar. 31, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization | Organization Vericel Corporation, a Michigan corporation (together with its consolidated subsidiaries referred to herein as the Company, or Vericel), was incorporated in March 1989 and began employee-based operations in 1991. The Company is a fully-integrated, commercial-stage biopharmaceutical company and is a leading provider of advanced therapies for the sports medicine and severe burn care markets. Vericel currently markets three commercial-stage products in the U.S., MACI ® , Epicel ® and NexoBrid ® . MACI (autologous cultured chondrocytes on porcine collagen membrane) is an autologous cellularized scaffold product indicated for the repair of symptomatic, single or multiple full-thickness cartilage defects of the knee with or without bone involvement in adults. Epicel (cultured epidermal autografts) is a permanent skin replacement for the treatment of adult and pediatric patients with deep-dermal or full-thickness burns comprising greater than or equal to 30 percent of total body surface area (“TBSA”). The Company also holds an exclusive license from MediWound Ltd. (“MediWound”) for North American rights to NexoBrid (anacaulase-bcdb), a topically administered biological orphan product containing proteolytic enzymes, which is indicated for the removal of eschar in adults with deep partial-thickness and/or full thickness thermal burns. Following the FDA’s approval of a Biologics License Application for NexoBrid on December 28, 2022, the Company began commercial sales of NexoBrid in the U.S. during the third quarter of 2023. The Company operates its business primarily in the U.S. in one reportable segment — the research, product development, manufacture and distribution of cellular therapies and specialty biologics for use in the treatment of specific conditions. The Company is subject to risks common to companies in the life sciences industry including, but not limited to, development by the Company or its competitors of new technological innovations, dependence on key personnel, protection of proprietary technology, commercialization of existing and new products, and compliance with FDA regulations and approval requirements, as well as the ability to grow the Company’s business through appropriate commercial strategies. The War in Ukraine The ongoing war between Russia and Ukraine and the related sanctions and other penalties imposed by countries across the globe against Russia are continuing to create substantial uncertainty in the global economy and have contributed to heightened inflation and supply chain disruptions. While the Company does not have operations in Russia or Ukraine and does not have exposure to distributors, or third-party service providers in Russia or Ukraine, it is unable to predict the ultimate impact that these actions will have on the global economy or on its financial condition, results of operations, and cash flows as of the date of these condensed consolidated financial statements. The War in Israel and Gaza In May 2019, the Company entered into exclusive license and supply agreements with MediWound, under which MediWound manufactures and supplies NexoBrid to the U.S. market on a unit price basis. MediWound develops and manufactures NexoBrid, in part, at its facilities in Yavne, Israel. The Company continues to monitor the ongoing conflict in Israel and is in close communication with MediWound leadership. MediWound’s NexoBrid manufacturing operations are continuing and, as of the date of this disclosure, MediWound does not anticipate a disruption to its ongoing supply of commercial NexoBrid to the United States. To the extent the war between Israel and Hamas intensifies or expands to include additional countries or militant groups in the region and MediWound’s facilities in Israel are damaged or destroyed, travel to and from Israel is halted or inhibited, or significant key MediWound operational personnel are called to military service, MediWound’s ability to continue to supply NexoBrid to the U.S. market could be disrupted. Liquidity The accompanying condensed consolidated financial statements have been prepared on a basis which assumes that the Company will continue as a going concern and contemplates the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. As of March 31, 2024, the Company had an accumulated deficit of $407.0 million and had a net loss of $3.9 million during the three months ended March 31, 2024. The Company had cash and cash equivalents of $62.9 million and investments of $77.1 million as of March 31, 2024. The Company expects that cash from the sales of its products and existing cash, cash equivalents, investments, and available borrowing capacity will be sufficient to support the Company’s current operations through at least 12 months from the issuance of these condensed consolidated financial statements. If revenues decline for a sustained period, the Company may need to access additional capital; however, the Company may not be able to obtain additional financing on acceptable terms or at all. The terms of any additional financing may adversely affect the holdings or the rights of the Company’s shareholders. Concentration of Credit Risk Financial instruments that potentially subject the Company to significant concentration of credit risk consist primarily of cash, cash equivalents and investments in marketable debt securities. The Company may maintain deposits in financial institutions in excess of the insurance coverage offered by the Federal Deposit Insurance Corporation, the loss of which could have a negative effect on its operations and liquidity. The Company believes that it is not exposed to significant credit risk as its deposits, including cash and cash equivalents, are held at multiple high credit quality financial institutions. The Company has not experienced any losses on these deposits; however no assurances can be provided that there will not be losses experienced in the future. The Company believes that the market risk arising from its holdings of these financial instruments is mitigated based on the fact that many of these securities are either government-backed or of high credit rating. |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2024 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying condensed consolidated financial statements of Vericel are unaudited and have been prepared in accordance with the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”). The preparation of condensed consolidated financial statements in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”) requires management to make estimates, judgments, and assumptions that may affect the reported amounts of assets, liabilities, equity, revenue and expenses. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been omitted pursuant to such rules and regulations. The financial statements reflect, in the opinion of management, all adjustments (consisting only of normal, recurring adjustments) necessary to state fairly the financial position and results of operations as of and for the periods indicated. The Company bases its estimates on historical experience and on various other assumptions that it believes are reasonable, the results of which form the basis for making judgments about the carrying values of assets, liabilities and equity and the amount of revenue and expenses. The condensed consolidated balance sheet as of December 31, 2023 has been derived from the audited consolidated financial statements at that date, but does not include all the information and notes required by U.S. GAAP for complete financial statements. These c ondensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the SEC on February 29, 2024 (“Annual Report”). Recent Accounting Pronouncements No new accounting standards were adopted during the three months ended March 31, 2024. The Company considers the applicability and impact of any recent Accounting Standards Updates (“ASUs”) issued by the Financial Accounting Standards Board (“FASB”), as noted below: In November 2023 , the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures , to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The disclosure requirements must be applied retrospectively to all prior periods presented in the financial statements. The effective date for the standard is for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024 , with early adoption permitted. The Company is currently evaluating the effects adoption of this guidance will have on the consolidated financial statements. In December 2023, the FASB issued ASU 2023-09 , Improvements to Income Tax Disclosures , to provide more detailed income tax disclosure requirements. The guidance requires entities to disclose disaggregated information about their effective tax rate reconciliation as well as information on income taxes paid. The disclosure requirements will be applied on a prospective basis, with the option to apply it retrospectively. The effective date for the standard is for fiscal years beginning after December 15, 2024, with early adoption permitted. The Company is currently evaluating the effects adoption of this guidance will have on the consolidated financial statements. |
Revenue
Revenue | 3 Months Ended |
Mar. 31, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue Revenue Recognition and Product Sales, Net The Company recognizes product revenue from sales of MACI biopsy kits, MACI implants, Epicel grafts, and NexoBrid following the five-step model in Accounting Standards Codification 606, Revenue Recognition. MACI Biopsy Kits MACI biopsy kits are sold directly to hospitals and ambulatory surgical centers based on contracted rates in an approved contract or sales order. The Company recognizes MACI kit revenue upon delivery of the biopsy kit, at which time the customer (the facility) is in control of the kit. The kit is used by the doctor to provide a sample of cartilage tissue to the Company, which can later be used to manufacture a MACI implant. The ordering of the kit does not obligate the Company to manufacture an implant nor does the receipt of the cartilage tissue by the Company from the customer following biopsy. The customer’s order of an implant is separate from the process of ordering the biopsy kit. Therefore, the sale of the biopsy kit and any subsequent sale of an implant are distinct contracts and are accounted for separately. MACI Implants The Company contracts with two specialty pharmacies, Orsini Pharmaceutical Services, Inc. (“Orsini”) and AllCare Plus Pharmacy, Inc. (“AllCare”) to distribute MACI in a manner in which the Company retains the credit and collection risk from the end customer. The Company pays each specialty pharmacy a fee in each instance when it dispenses MACI for use in treating a patient. Both Orsini and AllCare perform collection activities to collect payment from customers. In addition, the Company sells MACI directly to hospitals pursuant to an agreed upon purchase order and to a distributor, DMS Pharmaceutical Group, Inc. (“DMS”) at a contracted rate for the treatment of patients at military facilities throughout the U.S. The Company engages a third party to provide services in connection with a patient support program to manage patient cases and to ensure that complete and correct billing information is provided to the insurers and hospitals. Prior authorization and confirmation of coverage level by the patient’s private insurance plan, hospital or government payer is a prerequisite to the shipment of a MACI implant to a patient. The Company recognizes product revenue from sales of all MACI implants upon delivery at which time the customer obtains control of the implant and the claim is billable. The total consideration that the Company expects to collect in exchange for MACI implants (the “Transaction Price”) may be fixed or variable. Direct sales to hospitals or distributors are recorded at a contracted price, and there are typically no forms of variable consideration. When the Company sells MACI through its specialty pharmacies, the Company is typically reimbursed by a third-party insurer or government payer, subject to a patient co-pay amount. Reimbursements from third-party insurers and government payers vary by patient and payer and are based on either contracted rates, publicly available rates, fee schedules or past payer precedents. Net product revenue is recognized net of estimated contractual allowances, which considers historical collection experience from both the payer and patient, denial rates and the terms of the Company’s contractual arrangements. The Company estimates expected collections for these transactions using the portfolio approach. The Company records a reduction to revenue at the time of sale for its estimate of the amount of consideration that will not be collected. In addition, potential credit risk exposure has been evaluated for the Company’s accounts receivable in accordance with ASC 326, Financial Instruments - Credit Losses . The Company assesses risk and determines a loss percentage by pooling accounts receivable based on similar risk characteristics. The loss percentage is calculated through the use of forecasts that are based on current and historical economic and financial information. This loss percentage was applied to the accounts receivables as of March 31, 2024. The total allowance for uncollectible consideration as of March 31, 2024 and December 31, 2023 was $5.3 million and $5.6 million, respectively. Changes to the estimate of the amount of consideration that will not be collected could have a material impact on the revenue recognized. A 50 basis points change to the estimated uncollectible percentage could result in an approximately $0.4 million decrease or increase in the revenue recognized for the three months ended March 31, 2024. Changes in estimates of the Transaction Price are recorded through revenue in the period in which such change occurs. Changes in estimates related to prior periods are shown in the Revenue by Product and Customer table below and relate primarily to changes in the initial expected reimbursement or collection expectation upon completion of the billing claims process for MACI implants that occurred in a prior period. Epicel The Company sells Epicel directly to hospitals and burn centers based on contracted rates stated in an approved contract or purchase order. Similar to MACI, there is no obligation to manufacture Epicel grafts upon receipt of a skin biopsy, and Vericel has no contractual right to receive payment until the product is delivered to the hospital. The Company recognizes product revenue from sales of Epicel upon delivery to the hospital, at which time the customer is in control of the Epicel grafts and the claim is billable to the hospital. NexoBrid The Company entered into exclusive license and supply agreements with MediWound in May 2019, pursuant to which MediWound will manufacture and supply NexoBrid on a unit price basis, which may be increased pursuant to the terms of the agreements. Additionally, beginning in 2020 the U.S. Biomedical Advanced Research and Development Authority (“BARDA”) procured quantities of NexoBrid from MediWound, for use as a medical countermeasure in the event of a mass casualty emergency in the U.S. involving thermal burns. The initial, quarterly, procurement of NexoBrid by BARDA under its agreement with MediWound completed during the third quarter of 2022. The Company recognized revenue based on a percentage of gross profits for sales of NexoBrid to BARDA upon delivery, at which time BARDA was in control of the product. As of March 31, 2024, the Company did not hold a direct contract or distribution agreement with BARDA, or take title to the product procured by BARDA. On December 28, 2022, the FDA approved a BLA for NexoBrid, granting a license for commercial use in the U.S. NexoBrid is a topically-administered biological orphan product containing proteolytic enzymes, which is indicated for the removal of eschar in adults with deep partial-thickness and/or full thickness thermal burns. The Company sells NexoBrid to specialty distributors. These customers subsequently resell NexoBrid to hospitals and burn centers. Product revenue is recorded net of reserves for specialty distributor fees, prompt payment discounts and allowances for returns, as applicable. The Company recognizes product revenue from sales of NexoBrid when the specialty distributors take control of the product, which typically occurs upon delivery to the specialty distributors. Revenue by Product and Customer The following table and descriptions below show the products from which the Company generated its revenue for the periods indicated: Three Months Ended March 31, Revenue by product (in thousands) 2024 2023 MACI implants and kits Implants based on contracted rate sold through a specialty pharmacy (a) $ 27,196 $ 22,698 Implants subject to third party reimbursement sold through a specialty pharmacy (b) 3,253 3,485 Implants sold direct based on contracted rates (c) 6,402 6,919 Implants sold direct subject to third-party reimbursement (d) 1,185 501 Biopsy kits - direct bill 565 535 Change in estimates related to prior periods (e) 1,580 52 Total MACI implants and kits 40,181 34,190 Epicel Direct bill (hospital) 10,664 6,827 NexoBrid (f) 436 — Total revenue $ 51,281 $ 41,017 (a) Represents implants sold through Orsini and AllCare whereby such specialty pharmacies have a direct contract with the underlying insurance provider. The amount of reimbursement is based on contracted rates at the time of sale supported by the pharmacy’s direct contracts. (b) Represents implants sold through Orsini and AllCare whereby such specialty pharmacy does not have a direct contract with the underlying payer, and are subject to third-party reimbursement. The amount of reimbursement is established based on publicly available rates, fee schedules or past payer precedents. (c) Represents implants sold directly from the Company to the facility based on a contract and known price agreed upon prior to the surgery date. Also represents direct sales under a contract to specialty distributor DMS. (d) Represents implants sold directly from the Company to the facility based on a contract and known price agreed upon prior to the surgery date. The payment terms are subject to third-party reimbursement from an underlying insurance provider. (e) Primarily represents changes in estimates related to implants sold through Orsini or AllCare and relate to changes to the initial expected reimbursement or collection expectations upon completion of the billing claims process. The change in estimates is a result of additional information, changes in collection expectations or actual cash collections received in the current period. (f) Represents U.S. commercial revenue of NexoBrid. |
Selected Balance Sheet Componen
Selected Balance Sheet Components | 3 Months Ended |
Mar. 31, 2024 | |
Balance Sheet Related Disclosures [Abstract] | |
Selected Balance Sheet Components | Selected Balance Sheet Components Inventory Inventory consisted of the following: (In thousands) March 31, 2024 December 31, 2023 Raw materials $ 10,858 $ 11,348 Work-in-process 1,745 1,210 Finished goods 954 529 Total inventory $ 13,557 $ 13,087 Property and Equipment Property and Equipment, net consisted of the following: (In thousands) March 31, 2024 December 31, 2023 Machinery and equipment $ 5,822 $ 5,562 Furniture, fixtures and office equipment 1,647 1,731 Computer equipment and software 9,976 9,116 Leasehold improvements 14,901 14,901 Construction in process 47,474 32,531 Total property and equipment, gross 79,820 63,841 Less accumulated depreciation (23,428) (22,206) Total property and equipment, net $ 56,392 $ 41,635 Depreciation expense for the three months ended March 31, 2024 and 2023 was $1.2 million and $1.0 million, respectively. Intangible Assets Intangible assets, net consisted of the following: March 31, 2024 December 31, 2023 (In thousands) Useful Life (in years) Amortization Method Cost Accumulated Amortization Net Cost Accumulated Amortization Net NexoBrid license 12 Straight-line $ 7,500 $ (781) $ 6,719 $ 7,500 $ (625) $ 6,875 Amortization expense for the three months ended March 31, 2024 and 2023 was $0.2 million. Future amortization expense of intangible assets as of March 31, 2024 is estimated to be as follows: (In thousands) Amount Remainder of 2024 $ 469 2025 625 2026 625 2027 625 2028 625 Thereafter 3,750 Total $ 6,719 Accrued Expenses Accrued Expenses consisted of the following: (In thousands) March 31, 2024 December 31, 2023 Bonus-related compensation $ 3,932 $ 9,757 Employee-related accruals 3,394 3,503 Insurance reimbursement-related liabilities 3,385 3,591 Other accrued expenses 315 364 Total accrued expenses $ 11,026 $ 17,215 |
Leases
Leases | 3 Months Ended |
Mar. 31, 2024 | |
Leases [Abstract] | |
Leases | Leases The Company leases facilities in Ann Arbor, Michigan, Cambridge, Massachusetts and Burlington, Massachusetts. The Ann Arbor facility includes office space, and the Cambridge facilities include clean rooms, laboratories for MACI and Epicel manufacturing and office space. The Company also leases offsite warehouse space and other computer-related equipment. On January 28, 2022, the Company entered into a lease agreement (the “Burlington Lease”) to lease approximately 126,000 square feet of manufacturing, laboratory and office space in Burlington, Massachusetts (the “Premises”), which is currently being constructed. Once constructed, the Premises will serve as the Company’s new corporate headquarters and primary manufacturing facility. In April 2023, in connection with the Burlington Lease, the Company entered into a construction escrow agreement (the “Construction Escrow Agreement”) with the facility’s landlord and an escrow agent. Pursuant to the terms of the Construction Escrow Agreement, in April 2023, the Company began funding, into an escrow account maintained by the escrow agent, a portion of its share of tenant improvement construction costs at the facility, which are designated as restricted cash. At the same time, the facility’s landlord began funding a portion of its tenant improvement allowance through a separate escrow account. The Company funded the remaining 50% of its required cost amount, or approximately $28.3 million, with cash on hand, pursuant to the Construction Escrow Agreement in April 2024. The term of the Burlington Lease began on June 1, 2023, (the “Commencement Date”), when the Company gained control of and commenced tenant improvement work at the Premises. The Company’s obligation to pay rent for the Premises will begin on the earlier of: 13 months from the Commencement Date; or the date on which the Company first occupies the Premises to conduct operations (the “Rent Commencement Date”). The initial term of the Lease is 144 months following the Rent Commencement Date. The Company has a one-time option to extend the term of the Lease for an additional 10 years, exercisable under certain conditions and at a market rate determined in accordance with the Burlington Lease. The annual base rent of the Burlington Lease is initially $57 per square foot per year, subject to annual increases of 2.5%. Monthly contractual payments are expected to range from $0.6 million to $0.8 million. Additionally, the Company is responsible for reimbursing the landlord for the Company’s share of the Premises’ property taxes and certain other operating expenses. The Burlington Lease also provides for a tenant improvement allowance from the landlord in an amount equal to $200 per square foot of the Premises, or approximately $24.4 million. The tenant improvement allowance is being used towards the design and construction of the tenant improvements made to the Premises, subject to the terms set forth in the Burlington Lease. The Company was not involved in the initial construction of the core and shell of the building. On June 1, 2023, the Company gained control of the Premises to begin construction of its tenant improvements. As such, the corresponding right-of-use asset and lease liability of $35.5 million was recorded on the Company’s condensed consolidated balance sheet. As there was not an implicit rate within the lease available, the Company estimated the incremental borrowing rate of 7.7%, based on the rate of interest the Company would have to pay to borrow a similar amount on a collateralized basis over a similar term. The lease term of 13.1 years does not include the lease extension option, as the Company is not reasonably certain to exercise that option. The Company has determined that certain improvements to the Premises are landlord-owned improvements and costs incurred for these improvements are accounted for as a variable lease payment. In the three months ended March 31, 2024, the Company recorded a right-of-use asset related to landlord-owned improvements incurred of approximately $1.8 million. In January 2022, in connection with the execution of the Burlington Lease, the Company issued a letter of credit collateralized by cash deposits of approximately $6.0 million. Subsequent to the execution of the Revolving Credit Agreement on July 29, 2022 (see Note 8, “Revolving Credit Agreement” for further details), the letter of credit is issued under the sub-facility limit of the Revolving Credit Agreement. Such letter of credit shall be reduced to approximately $4.2 million and $1.8 million at the conclusion of the third and sixth lease years, respectively, provided certain conditions set forth in the Burlington Lease are satisfied. For the three months ended March 31, 2024 and 2023, lease expense of less than $0.1 million was recorded related to short-term leases. For the three months ended March 31, 2024 and 2023 , the Company recognized $3.2 million and $1.7 million, respectively, of operating lease expense. For the three months ended March 31, 2023, the Company recognized less than $0.1 million of financing lease expense . Operating and finance lease assets and liabilities are as follows: (In thousands) Classification March 31, 2024 December 31, 2023 Assets Operating Right-of-use assets $ 73,682 $ 73,462 Liabilities Current Operating Current portion of operating lease liabilities $ 6,012 $ 6,187 Non-current Operating Operating lease liabilities $ 86,141 $ 81,856 Total leased liabilities $ 92,153 $ 88,043 |
Leases | Leases The Company leases facilities in Ann Arbor, Michigan, Cambridge, Massachusetts and Burlington, Massachusetts. The Ann Arbor facility includes office space, and the Cambridge facilities include clean rooms, laboratories for MACI and Epicel manufacturing and office space. The Company also leases offsite warehouse space and other computer-related equipment. On January 28, 2022, the Company entered into a lease agreement (the “Burlington Lease”) to lease approximately 126,000 square feet of manufacturing, laboratory and office space in Burlington, Massachusetts (the “Premises”), which is currently being constructed. Once constructed, the Premises will serve as the Company’s new corporate headquarters and primary manufacturing facility. In April 2023, in connection with the Burlington Lease, the Company entered into a construction escrow agreement (the “Construction Escrow Agreement”) with the facility’s landlord and an escrow agent. Pursuant to the terms of the Construction Escrow Agreement, in April 2023, the Company began funding, into an escrow account maintained by the escrow agent, a portion of its share of tenant improvement construction costs at the facility, which are designated as restricted cash. At the same time, the facility’s landlord began funding a portion of its tenant improvement allowance through a separate escrow account. The Company funded the remaining 50% of its required cost amount, or approximately $28.3 million, with cash on hand, pursuant to the Construction Escrow Agreement in April 2024. The term of the Burlington Lease began on June 1, 2023, (the “Commencement Date”), when the Company gained control of and commenced tenant improvement work at the Premises. The Company’s obligation to pay rent for the Premises will begin on the earlier of: 13 months from the Commencement Date; or the date on which the Company first occupies the Premises to conduct operations (the “Rent Commencement Date”). The initial term of the Lease is 144 months following the Rent Commencement Date. The Company has a one-time option to extend the term of the Lease for an additional 10 years, exercisable under certain conditions and at a market rate determined in accordance with the Burlington Lease. The annual base rent of the Burlington Lease is initially $57 per square foot per year, subject to annual increases of 2.5%. Monthly contractual payments are expected to range from $0.6 million to $0.8 million. Additionally, the Company is responsible for reimbursing the landlord for the Company’s share of the Premises’ property taxes and certain other operating expenses. The Burlington Lease also provides for a tenant improvement allowance from the landlord in an amount equal to $200 per square foot of the Premises, or approximately $24.4 million. The tenant improvement allowance is being used towards the design and construction of the tenant improvements made to the Premises, subject to the terms set forth in the Burlington Lease. The Company was not involved in the initial construction of the core and shell of the building. On June 1, 2023, the Company gained control of the Premises to begin construction of its tenant improvements. As such, the corresponding right-of-use asset and lease liability of $35.5 million was recorded on the Company’s condensed consolidated balance sheet. As there was not an implicit rate within the lease available, the Company estimated the incremental borrowing rate of 7.7%, based on the rate of interest the Company would have to pay to borrow a similar amount on a collateralized basis over a similar term. The lease term of 13.1 years does not include the lease extension option, as the Company is not reasonably certain to exercise that option. The Company has determined that certain improvements to the Premises are landlord-owned improvements and costs incurred for these improvements are accounted for as a variable lease payment. In the three months ended March 31, 2024, the Company recorded a right-of-use asset related to landlord-owned improvements incurred of approximately $1.8 million. In January 2022, in connection with the execution of the Burlington Lease, the Company issued a letter of credit collateralized by cash deposits of approximately $6.0 million. Subsequent to the execution of the Revolving Credit Agreement on July 29, 2022 (see Note 8, “Revolving Credit Agreement” for further details), the letter of credit is issued under the sub-facility limit of the Revolving Credit Agreement. Such letter of credit shall be reduced to approximately $4.2 million and $1.8 million at the conclusion of the third and sixth lease years, respectively, provided certain conditions set forth in the Burlington Lease are satisfied. For the three months ended March 31, 2024 and 2023, lease expense of less than $0.1 million was recorded related to short-term leases. For the three months ended March 31, 2024 and 2023 , the Company recognized $3.2 million and $1.7 million, respectively, of operating lease expense. For the three months ended March 31, 2023, the Company recognized less than $0.1 million of financing lease expense . Operating and finance lease assets and liabilities are as follows: (In thousands) Classification March 31, 2024 December 31, 2023 Assets Operating Right-of-use assets $ 73,682 $ 73,462 Liabilities Current Operating Current portion of operating lease liabilities $ 6,012 $ 6,187 Non-current Operating Operating lease liabilities $ 86,141 $ 81,856 Total leased liabilities $ 92,153 $ 88,043 |
Investments
Investments | 3 Months Ended |
Mar. 31, 2024 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | Investments Marketable debt securities held by the Company are classified as available-for-sale pursuant to ASC 320, Investments – Debt and Equity Securities , and carried at fair value in the accompanying condensed consolidated balance sheets on a settlement date basis. The following tables summarize the gross unrealized gains and losses of the Company’s marketable securities: March 31, 2024 Gross Unrealized Estimated Fair Value (In thousands) Amortized Cost Gains Losses Credit Losses Commercial paper $ 7,396 $ — $ (13) $ — $ 7,383 Corporate notes 56,803 — (199) — 56,604 U.S. government securities 2,473 — (1) — 2,472 U.S. government agency bonds 10,713 — (29) — 10,684 $ 77,385 $ — $ (242) $ — $ 77,143 Classified as: Short-term investments $ 47,710 Long-term investments 29,433 $ 77,143 December 31, 2023 Gross Unrealized Estimated Fair Value (In thousands) Amortized Cost Gains Losses Credit Losses Commercial paper $ 3,638 $ 1 $ — $ — $ 3,639 Corporate notes 47,228 — (69) — 47,159 U.S. government securities 983 — — — 983 U.S. government agency bonds 14,003 — (32) — 13,971 $ 65,852 $ 1 $ (101) $ — $ 65,752 Classified as: Short-term investments $ 40,469 Long-term investments 25,283 $ 65,752 |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2024 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The Company’s fair value measurements are classified and disclosed in one of the following three categories: • Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; • Level 2: Quoted prices in markets that are not active, or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability; • Level 3: Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity). Assets and liabilities measured at fair value are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The commercial paper, corporate notes, U.S. government securities, and U.S. government agency bonds are classified as Level 2 as they were valued based upon quoted market prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-based valuation techniques for which all significant inputs are observable in the market or can be corroborated by observable market data for substantially the full term of the assets. There were no transfers into or out of Level 3 from December 31, 2023 to March 31, 2024. The following table summarizes the valuation of the Company’s financial instruments that are measured at fair value on a recurring basis: March 31, 2024 December 31, 2023 Fair value measurement category Fair value measurement category (In thousands) Total Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Assets: Money market funds $ 36,617 $ 36,617 $ — $ — $ 34,672 $ 34,672 $ — $ — Commercial paper (a) 8,873 — 8,873 — 4,876 — 4,876 — Corporate notes 56,606 — 56,606 — 47,159 — 47,159 — U.S. government agency bonds (a) 10,684 — 10,684 — 13,971 — 13,971 — U.S. government securities (a) 23,763 — 23,763 — 24,874 — 24,874 — $ 136,543 $ 36,617 $ 99,926 $ — $ 125,552 $ 34,672 $ 90,880 $ — (a) Approximately $1.5 million of commercial paper and $21.3 million of U.S. government securities had an original maturity of 90 days or less and is recorded as a cash equivalent as of March 31, 2024. Approximately $23.9 million of U.S. government securities and $1.2 million of commercial paper had an original maturity of 90 days or less and is recorded as a cash equivalent as of December 31, 2023. The fair values of the cash equivalents and marketable securities are based on observable market prices. The Company’s accounts receivables, accounts payable and accrued expenses are valued at cost, which approximates fair value. |
Revolving Credit Agreement
Revolving Credit Agreement | 3 Months Ended |
Mar. 31, 2024 | |
Debt Disclosure [Abstract] | |
Revolving Credit Agreement | Revolving Credit Agreement On July 29, 2022, the Company, as borrower, entered into a $150.0 million five-year senior secured revolving credit agreement by and among the Company, the other loan parties thereto, the lenders party thereto, and JPMorgan Chase Bank, N.A., as the administrative agent (the “Revolving Credit Agreement”). The Revolving Credit Agreement includes a $15.0 million sub-facility for the issuance of letters of credit, of which the Company is utilizing approximately $6.2 million. Amounts available under the Revolving Credit Agreement are for the working capital needs and other general corporate purposes of the Company. The Company incurred and capitalized approximately $1.1 million of debt issuance costs related to the Revolving Credit Agreement. Outstanding borrowings under the Revolving Credit Agreement bear interest, with pricing based from time to time at the Company’s election at (i) the Secured Overnight Financing Rate (“SOFR”) plus 0.10% plus a spread ranging from 1.25% to 2.50% as determined by the Company’s Total Net Leverage Ratio (as defined in the Revolving Credit Agreement) or (ii) the alternative base rate (as defined in the Revolving Credit Agreement) plus a spread ranging from 0.25% to 1.50% as determined by the Company’s Total Net Leverage Ratio. The Revolving Credit Agreement also includes a commitment fee, which ranges from 0.20% to 0.25% as determined by the Company’s Total Net Leverage Ratio. The Company is permitted to voluntarily prepay borrowings under the Revolving Credit Agreement, in whole or in part, without premium or penalty. On any business day on which the total amount of outstanding Revolving Loans (as defined in the Revolving Credit Agreement) and letters of credit exceeds the total Revolving Commitments (as defined in the Revolving Credit Agreement), the Company must prepay the Revolving Loans in an amount equal to such excess. As of March 31, 2024, there are no outstanding borrowings under the Revolving Credit Agreement. The Revolving Credit Agreement contains a number of affirmative, negative, reporting and financial covenants, in each case subject to certain exceptions and materiality thresholds. The Revolving Credit Agreement requires the Company to be in quarterly compliance, measured on a trailing four quarter basis, with a financial covenant. The maximum Total Net Leverage Ratio (as defined in the Revolving Credit Agreement) is 3.50 to 1.00. The Company may elect to increase the maximum Total Net Leverage Ratio to 4.00 to 1.00 for a period of four consecutive quarters in connection with a Permitted Acquisition (as defined in the Revolving Credit Agreement). The Revolving Credit Agreement contains usual and customary restrictions on the ability of the Company and its subsidiaries to: (i) incur additional indebtedness; (ii) create liens; (iii) consolidate, merge, sell or otherwise dispose of all, or substantially all, of its assets; (iv) sell certain assets; (v) pay dividends on, repurchase or make distributions in respect of capital stock or make other restricted payments; (vi) make certain investments; (vii) repay subordinated indebtedness prior to stated maturity; and (viii) enter into certain transactions with its affiliates. Obligations under the Revolving Credit Agreement are secured by first priority liens over substantially all of the assets of Vericel Corporation, excluding certain subsidiaries (subject to customary exclusions set forth in the Revolving Credit Agreement and the other transaction documents). |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2024 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation The Vericel Corporation 2022 Omnibus Incentive Plan (“2022 Plan”) was approved on April 27, 2022, and provides incentives through the grant of stock options, stock appreciation rights, restricted stock awards and restricted stock units. The exercise price of stock options granted under the 2022 Plan shall not be less than the fair market value of the Company’s common stock on the date of grant. The 2022 Plan replaced the 1992 Stock Option Plan, the 2001 Stock Option Plan, the Amended and Restated 2004 Equity Incentive Plan, the 2009 Second Amended and Restated Omnibus Incentive Plan, the 2017 Omnibus Incentive Plan, and the Amended and Restated 2019 Omnibus Incentive Plan (collectively the “Prior Plans”), and no new grants have been granted under the Prior Plans after approval of the 2022 Plan. However, the expiration or forfeiture of options previously granted under the Prior Plans will increase the number of shares available for issuance under the 2022 Plan. Stock Compensation Expense Non-cash stock-based compensation expense (service-based stock options, restricted stock units and employee stock purchase plan) is summarized in the following table: Three Months Ended March 31, (in thousands) 2024 2023 Cost of product sales $ 1,241 $ 885 Research and development 1,221 977 Selling, general and administrative 7,372 6,869 Total non-cash stock-based compensation expense $ 9,834 $ 8,731 Service-Based Stock Options During the three months ended March 31, 2024 and 2023, the Company granted service-based options to purchase common stock of 507,162 and 467,957, respectively. The weighted-average grant-date fair value of service-based options granted during the three months ended March 31, 2024 and 2023 was $28.21 and $18.00 per option, respectively. Restricted Stock Units During the three months ended March 31, 2024 and 2023, the Company granted 538,425 and 496,505 restricted stock units, respectively. The weighted-average grant-date fair value of restricted stock units granted during the three months ended March 31, 2024 and 2023 was $48.25 and $29.82 per unit, respectively. |
Net Loss Per Common Share
Net Loss Per Common Share | 3 Months Ended |
Mar. 31, 2024 | |
Earnings Per Share [Abstract] | |
Net Loss Per Common Share | Net Loss Per Common Share A summary of net loss per common share is presented below: Three Months Ended March 31, (Amounts in thousands, except per share amounts) 2024 2023 Net loss $ (3,862) $ (7,495) Basic weighted-average common shares outstanding 48,141 47,387 Effect of dilutive stock options and restricted stock units — — Diluted weighted-average common shares outstanding 48,141 47,387 Basic loss per common share $ (0.08) $ (0.16) Diluted loss per common share $ (0.08) $ (0.16) Anti-dilutive shares excluded from diluted net loss per common share: Stock options 6,730 6,918 Restricted stock units 1,201 954 |
NexoBrid License and Supply Agr
NexoBrid License and Supply Agreements | 3 Months Ended |
Mar. 31, 2024 | |
Related Party Transactions [Abstract] | |
NexoBrid License and Supply Agreements | NexoBrid License and Supply Agreements On May 6, 2019, the Company entered into exclusive license and supply agreements with MediWound to commercialize NexoBrid in North America. The FDA subsequently approved a BLA for the product on December 28, 2022. NexoBrid is a topically-administered biological orphan product, which contains proteolytic enzymes and is indicated for the removal of eschar in adults with deep partial-thickness and/or full thickness thermal burns. Pursuant to the terms of the license agreement, following the FDA approval of NexoBrid, MediWound transferred the BLA to Vericel effective February 20, 2023. Both MediWound and Vericel, under the supervision of a Central Steering Committee comprised of members of both companies will continue to guide the development of NexoBrid in North America (the “Central Steering Committee”). NexoBrid is approved in the European Union (“EU”) and other international markets and has been designated as an orphan biologic in the U.S., EU and other international markets. In May 2019, the Company paid MediWound $17.5 million in consideration for the license, which was recorded as research and development expense during 2019. The FDA’s December 2022 approval of NexoBrid resulted in the achievement of a $7.5 million regulatory milestone payment pursuant to the terms of the license agreement. The Company recorded the $7.5 million milestone for the licensing rights to commercially sell NexoBrid in the U.S. as an intangible asset as of December 31, 2022 (see Note 4, “Selected Balance Sheet Components” for further details). The $7.5 million milestone payment was paid to MediWound in February of 2023. Additionally, the Company is obligated to pay MediWound up to $125.0 million, which is contingent upon meeting certain sales milestones. The first sales milestone payment of $7.5 million would be triggered when annual net sales of NexoBrid or improvements to NexoBrid in North America exceed $75.0 million. As of March 31, 2024, the sales milestone payments are not yet probable and therefore, not recorded as a liability. The Company also will pay MediWound tiered royalties on net sales ranging from mid-high single-digit to mid-teen percentages, subject to customary reductions. Pursuant to the terms of the Company’s supply agreement with MediWound, MediWound is manufacturing and will continue to manufacture NexoBrid for the Company on a unit price basis, which may be increased pursuant to the terms of the supply agreement. MediWound is obligated to supply the Company with NexoBrid for sale in North America on an exclusive basis for the first five years of the term of the supply agreement. Under the supply agreement, the Company possesses the option to extend the initial term of the agreement by an additional 24 months, which it did in May 2022. After the initial term, the Company may extend the supply agreement on an annual basis for up to 10 additional years, at its sole discretion. Under the supply agreement, the Company is permitted to establish an alternate source of supply in certain circumstances, including the event of a supply failure. Additionally, beginning in 2020, BARDA procured quantities of NexoBrid from MediWound for use as a medical countermeasure in the event of a mass casualty emergency in the U.S. involving thermal burns. The initial, quarterly, procurement of NexoBrid by BARDA under its agreement with MediWound completed during the third quarter of 2022. As a part of BARDA’s commitment to procure NexoBrid, the Company has received a percentage of gross profit for sales directly to BARDA. As of March 31, 2024, the Company did not hold a direct contract or distribution agreement with BARDA, or take title to the product procured by BARDA. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies From time-to-time, the Company could be a party to various legal proceedings arising in the ordinary course of business. The costs and outcome of litigation, regulatory, investigatory or other proceedings cannot be predicted with certainty, and some lawsuits, claims, actions or proceedings may be disposed of unfavorably to the Company and could have a material adverse effect on the Company’s results of operations or financial condition. In addition, intellectual property disputes often have a risk of injunctive relief which, if imposed against the Company, could materially and adversely affect its financial condition or results of operations. If a matter is both probable to result in material liability and the amount of loss can be reasonably estimated, the Company estimates and discloses the possible material loss or range of loss. If such loss is not probable or cannot be reasonably estimated, a liability is not recorded in its condensed consolidated financial statements. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Pay vs Performance Disclosure | ||
Net loss | $ (3,862) | $ (7,495) |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Mar. 31, 2024 shares | |
Trading Arrangements, by Individual | |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Kevin McLaughlin [Member] | |
Trading Arrangements, by Individual | |
Material Terms of Trading Arrangement | On March 11, 2024, Kevin McLaughlin, a member of the Vericel Corporation Board of Directors, entered into a Rule 10b5-1 trading arrangement providing for the potential sale of up to 35,000 shares of our common stock between August 7, 2024, and August 8, 2025; |
Name | Kevin McLaughlin |
Title | member of the Vericel Corporation Board of Directors |
Rule 10b5-1 Arrangement Adopted | true |
Adoption Date | March 11, 2024 |
Arrangement Duration | 366 days |
Aggregate Available | 35,000 |
Robert Zerbe [Member] | |
Trading Arrangements, by Individual | |
Material Terms of Trading Arrangement | On March 12, 2024, Robert Zerbe, Chairman of the Vericel Corporation Board of Directors, entered into a Rule 10b5-1 trading arrangement providing for the potential sale of up to 17,500 shares of our common stock between September 3, 2024, and August 29, 2025; |
Name | Robert Zerbe |
Title | Chairman of the Vericel Corporation Board of Directors |
Rule 10b5-1 Arrangement Adopted | true |
Adoption Date | March 12, 2024 |
Arrangement Duration | 360 days |
Aggregate Available | 17,500 |
Sean Flynn [Member] | |
Trading Arrangements, by Individual | |
Material Terms of Trading Arrangement | On March 13, 2024, Sean Flynn, Vericel Corporation’s Chief Legal Officer, entered into a Rule 10b5-1 trading arrangement providing for the potential sale of up to 40,075 shares of our common stock between June 13, 2024 and May 30, 2025; |
Name | Sean Flynn |
Title | Chief Legal Officer |
Rule 10b5-1 Arrangement Adopted | true |
Adoption Date | March 13, 2024 |
Arrangement Duration | 351 days |
Aggregate Available | 40,075 |
Jonathan Siegal [Member] | |
Trading Arrangements, by Individual | |
Material Terms of Trading Arrangement | On March 13, 2024, Jonathan Siegal, Vericel Corporation’s Principal Accounting Officer, entered into a 10b5-1 Plan providing for the potential sale of up to 42,577 shares of our common stock between June 13, 2024 and February 28, 2025; and |
Name | Jonathan Siegal |
Title | Principal Accounting Officer |
Rule 10b5-1 Arrangement Adopted | true |
Adoption Date | March 13, 2024 |
Arrangement Duration | 260 days |
Aggregate Available | 42,577 |
Joseph Mara [Member] | |
Trading Arrangements, by Individual | |
Material Terms of Trading Arrangement | On March 15, 2024, Joseph Mara, Vericel Corporation’s Chief Financial Officer, entered into a Rule 10b5-1 trading arrangement providing for the potential sale of up to 5,000 shares of our common stock between June 13, 2024 and May 30, 2025. |
Name | Joseph Mara |
Title | Chief Financial Officer |
Rule 10b5-1 Arrangement Adopted | true |
Adoption Date | March 15, 2024 |
Arrangement Duration | 351 days |
Aggregate Available | 5,000 |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2024 | |
Accounting Policies [Abstract] | |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments that potentially subject the Company to significant concentration of credit risk consist primarily of cash, cash equivalents and investments in marketable debt securities. The Company may maintain deposits in financial institutions in excess of the insurance coverage offered by the Federal Deposit Insurance Corporation, the loss of which could have a negative effect on its operations and liquidity. The Company believes that it is not exposed to significant credit risk as its deposits, including cash and cash equivalents, are held at multiple high credit quality financial institutions. The Company has not experienced any losses on these deposits; however no assurances can be provided that there will not be losses experienced in the future. The Company believes that the market risk arising from its holdings of these financial instruments is mitigated based on the fact that many of these securities are either government-backed or of high credit rating. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements No new accounting standards were adopted during the three months ended March 31, 2024. The Company considers the applicability and impact of any recent Accounting Standards Updates (“ASUs”) issued by the Financial Accounting Standards Board (“FASB”), as noted below: In November 2023 , the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures , to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. The disclosure requirements must be applied retrospectively to all prior periods presented in the financial statements. The effective date for the standard is for fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024 , with early adoption permitted. The Company is currently evaluating the effects adoption of this guidance will have on the consolidated financial statements. In December 2023, the FASB issued ASU 2023-09 , Improvements to Income Tax Disclosures , to provide more detailed income tax disclosure requirements. The guidance requires entities to disclose disaggregated information about their effective tax rate reconciliation as well as information on income taxes paid. The disclosure requirements will be applied on a prospective basis, with the option to apply it retrospectively. The effective date for the standard is for fiscal years beginning after December 15, 2024, with early adoption permitted. The Company is currently evaluating the effects adoption of this guidance will have on the consolidated financial statements. |
Revenue (Tables)
Revenue (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of disaggregation of revenue | Three Months Ended March 31, Revenue by product (in thousands) 2024 2023 MACI implants and kits Implants based on contracted rate sold through a specialty pharmacy (a) $ 27,196 $ 22,698 Implants subject to third party reimbursement sold through a specialty pharmacy (b) 3,253 3,485 Implants sold direct based on contracted rates (c) 6,402 6,919 Implants sold direct subject to third-party reimbursement (d) 1,185 501 Biopsy kits - direct bill 565 535 Change in estimates related to prior periods (e) 1,580 52 Total MACI implants and kits 40,181 34,190 Epicel Direct bill (hospital) 10,664 6,827 NexoBrid (f) 436 — Total revenue $ 51,281 $ 41,017 (a) Represents implants sold through Orsini and AllCare whereby such specialty pharmacies have a direct contract with the underlying insurance provider. The amount of reimbursement is based on contracted rates at the time of sale supported by the pharmacy’s direct contracts. (b) Represents implants sold through Orsini and AllCare whereby such specialty pharmacy does not have a direct contract with the underlying payer, and are subject to third-party reimbursement. The amount of reimbursement is established based on publicly available rates, fee schedules or past payer precedents. (c) Represents implants sold directly from the Company to the facility based on a contract and known price agreed upon prior to the surgery date. Also represents direct sales under a contract to specialty distributor DMS. (d) Represents implants sold directly from the Company to the facility based on a contract and known price agreed upon prior to the surgery date. The payment terms are subject to third-party reimbursement from an underlying insurance provider. (e) Primarily represents changes in estimates related to implants sold through Orsini or AllCare and relate to changes to the initial expected reimbursement or collection expectations upon completion of the billing claims process. The change in estimates is a result of additional information, changes in collection expectations or actual cash collections received in the current period. (f) Represents U.S. commercial revenue of NexoBrid. |
Selected Balance Sheet Compon_2
Selected Balance Sheet Components (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Balance Sheet Related Disclosures [Abstract] | |
Schedule of inventory | Inventory consisted of the following: (In thousands) March 31, 2024 December 31, 2023 Raw materials $ 10,858 $ 11,348 Work-in-process 1,745 1,210 Finished goods 954 529 Total inventory $ 13,557 $ 13,087 |
Schedule of property and equipment, net | Property and Equipment, net consisted of the following: (In thousands) March 31, 2024 December 31, 2023 Machinery and equipment $ 5,822 $ 5,562 Furniture, fixtures and office equipment 1,647 1,731 Computer equipment and software 9,976 9,116 Leasehold improvements 14,901 14,901 Construction in process 47,474 32,531 Total property and equipment, gross 79,820 63,841 Less accumulated depreciation (23,428) (22,206) Total property and equipment, net $ 56,392 $ 41,635 |
Schedule of finite-lived intangible assets | Intangible assets, net consisted of the following: March 31, 2024 December 31, 2023 (In thousands) Useful Life (in years) Amortization Method Cost Accumulated Amortization Net Cost Accumulated Amortization Net NexoBrid license 12 Straight-line $ 7,500 $ (781) $ 6,719 $ 7,500 $ (625) $ 6,875 |
Schedule of finite-lived intangible assets, future amortization expense | Future amortization expense of intangible assets as of March 31, 2024 is estimated to be as follows: (In thousands) Amount Remainder of 2024 $ 469 2025 625 2026 625 2027 625 2028 625 Thereafter 3,750 Total $ 6,719 |
Schedule of accrued expenses | Accrued Expenses consisted of the following: (In thousands) March 31, 2024 December 31, 2023 Bonus-related compensation $ 3,932 $ 9,757 Employee-related accruals 3,394 3,503 Insurance reimbursement-related liabilities 3,385 3,591 Other accrued expenses 315 364 Total accrued expenses $ 11,026 $ 17,215 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Leases [Abstract] | |
Schedule of assets and liabilities | Operating and finance lease assets and liabilities are as follows: (In thousands) Classification March 31, 2024 December 31, 2023 Assets Operating Right-of-use assets $ 73,682 $ 73,462 Liabilities Current Operating Current portion of operating lease liabilities $ 6,012 $ 6,187 Non-current Operating Operating lease liabilities $ 86,141 $ 81,856 Total leased liabilities $ 92,153 $ 88,043 |
Investments (Tables)
Investments (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of fair value of securities, not including cash | The following tables summarize the gross unrealized gains and losses of the Company’s marketable securities: March 31, 2024 Gross Unrealized Estimated Fair Value (In thousands) Amortized Cost Gains Losses Credit Losses Commercial paper $ 7,396 $ — $ (13) $ — $ 7,383 Corporate notes 56,803 — (199) — 56,604 U.S. government securities 2,473 — (1) — 2,472 U.S. government agency bonds 10,713 — (29) — 10,684 $ 77,385 $ — $ (242) $ — $ 77,143 Classified as: Short-term investments $ 47,710 Long-term investments 29,433 $ 77,143 December 31, 2023 Gross Unrealized Estimated Fair Value (In thousands) Amortized Cost Gains Losses Credit Losses Commercial paper $ 3,638 $ 1 $ — $ — $ 3,639 Corporate notes 47,228 — (69) — 47,159 U.S. government securities 983 — — — 983 U.S. government agency bonds 14,003 — (32) — 13,971 $ 65,852 $ 1 $ (101) $ — $ 65,752 Classified as: Short-term investments $ 40,469 Long-term investments 25,283 $ 65,752 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Fair Value Disclosures [Abstract] | |
Schedule of valuation of the company's investments and financial instruments that are measured at fair value on a recurring basis | The following table summarizes the valuation of the Company’s financial instruments that are measured at fair value on a recurring basis: March 31, 2024 December 31, 2023 Fair value measurement category Fair value measurement category (In thousands) Total Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Assets: Money market funds $ 36,617 $ 36,617 $ — $ — $ 34,672 $ 34,672 $ — $ — Commercial paper (a) 8,873 — 8,873 — 4,876 — 4,876 — Corporate notes 56,606 — 56,606 — 47,159 — 47,159 — U.S. government agency bonds (a) 10,684 — 10,684 — 13,971 — 13,971 — U.S. government securities (a) 23,763 — 23,763 — 24,874 — 24,874 — $ 136,543 $ 36,617 $ 99,926 $ — $ 125,552 $ 34,672 $ 90,880 $ — (a) Approximately $1.5 million of commercial paper and $21.3 million of U.S. government securities had an original maturity of 90 days or less and is recorded as a cash equivalent as of March 31, 2024. Approximately $23.9 million of U.S. government securities and $1.2 million of commercial paper had an original maturity of 90 days or less and is recorded as a cash equivalent as of December 31, 2023. |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of non-cash stock-based compensation expense | Non-cash stock-based compensation expense (service-based stock options, restricted stock units and employee stock purchase plan) is summarized in the following table: Three Months Ended March 31, (in thousands) 2024 2023 Cost of product sales $ 1,241 $ 885 Research and development 1,221 977 Selling, general and administrative 7,372 6,869 Total non-cash stock-based compensation expense $ 9,834 $ 8,731 |
Net Loss Per Common Share (Tabl
Net Loss Per Common Share (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Earnings Per Share [Abstract] | |
Schedule of net loss attributable to common shareholders and share data used in the basic and diluted earnings per share computations using the two class method | A summary of net loss per common share is presented below: Three Months Ended March 31, (Amounts in thousands, except per share amounts) 2024 2023 Net loss $ (3,862) $ (7,495) Basic weighted-average common shares outstanding 48,141 47,387 Effect of dilutive stock options and restricted stock units — — Diluted weighted-average common shares outstanding 48,141 47,387 Basic loss per common share $ (0.08) $ (0.16) Diluted loss per common share $ (0.08) $ (0.16) Anti-dilutive shares excluded from diluted net loss per common share: Stock options 6,730 6,918 Restricted stock units 1,201 954 |
Organization (Details)
Organization (Details) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2024 USD ($) segment product | Mar. 31, 2023 USD ($) | Dec. 31, 2023 USD ($) | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Number of commercial-stage products | product | 3 | ||
Number of reportable segments | segment | 1 | ||
Accumulated deficit | $ 407,039 | $ 403,177 | |
Net loss | 3,862 | $ 7,495 | |
Cash and cash equivalents | 62,938 | $ 61,834 | $ 69,088 |
Short term investments | $ 77,100 |
Revenue - Narrative (Details)
Revenue - Narrative (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 USD ($) pharmacy | Dec. 31, 2023 USD ($) | |
Revenue from Contract with Customer [Abstract] | ||
Number of specialty pharmacies | pharmacy | 2 | |
Allowance for doubtful accounts | $ 5.3 | $ 5.6 |
Change in estimate of uncollectible (percent) | 0.50% | |
Change in revenue recognized due to 0.5% change in uncollectible percentage | $ 0.4 |
Revenue - Summary of Disaggrega
Revenue - Summary of Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Disaggregation of Revenue [Line Items] | ||
Product sales, net | $ 51,281 | $ 41,017 |
Total revenue | 51,281 | 41,017 |
Change in estimates related to prior periods | ||
Disaggregation of Revenue [Line Items] | ||
Product sales, net | 1,580 | 52 |
M A C I Implants and kits | ||
Disaggregation of Revenue [Line Items] | ||
Product sales, net | 40,181 | 34,190 |
Through Intermediary | MACI implants and kits | Contract rate | ||
Disaggregation of Revenue [Line Items] | ||
Product sales, net | 27,196 | 22,698 |
Through Intermediary | MACI implants and kits | Time-and-materials contract | ||
Disaggregation of Revenue [Line Items] | ||
Product sales, net | 3,253 | 3,485 |
Time-and-materials contract | MACI implants and kits | Time-and-materials contract | ||
Disaggregation of Revenue [Line Items] | ||
Product sales, net | 1,185 | 501 |
Provider or Facility | MACI implants and kits | Contract rate | ||
Disaggregation of Revenue [Line Items] | ||
Product sales, net | 6,402 | 6,919 |
Provider or Facility | NexoBrid | ||
Disaggregation of Revenue [Line Items] | ||
NexoBrid | 436 | 0 |
Directly to consumer | Biopsy kits | ||
Disaggregation of Revenue [Line Items] | ||
Product sales, net | 565 | 535 |
Directly to consumer | Epicel | ||
Disaggregation of Revenue [Line Items] | ||
Product sales, net | $ 10,664 | $ 6,827 |
Selected Balance Sheet Compon_3
Selected Balance Sheet Components - Summary of inventory (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Inventory: | ||
Raw materials | $ 10,858 | $ 11,348 |
Work-in-process | 1,745 | 1,210 |
Finished goods | 954 | 529 |
Total inventory | $ 13,557 | $ 13,087 |
Selected Balance Sheet Compon_4
Selected Balance Sheet Components - Schedule of property and equipment, net (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Property and equipment, net: | ||
Total property and equipment, gross | $ 79,820 | $ 63,841 |
Less accumulated depreciation | (23,428) | (22,206) |
Total property and equipment, net | 56,392 | 41,635 |
Machinery and equipment | ||
Property and equipment, net: | ||
Total property and equipment, gross | 5,822 | 5,562 |
Furniture, fixtures and office equipment | ||
Property and equipment, net: | ||
Total property and equipment, gross | 1,647 | 1,731 |
Computer equipment and software | ||
Property and equipment, net: | ||
Total property and equipment, gross | 9,976 | 9,116 |
Leasehold improvements | ||
Property and equipment, net: | ||
Total property and equipment, gross | 14,901 | 14,901 |
Construction in process | ||
Property and equipment, net: | ||
Total property and equipment, gross | $ 47,474 | $ 32,531 |
Selected Balance Sheet Compon_5
Selected Balance Sheet Components - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Property, Plant and Equipment [Line Items] | ||
Depreciation | $ 1.2 | $ 1 |
Licensing Agreements | ||
Property, Plant and Equipment [Line Items] | ||
Amortization of intangible assets | $ 0.2 | $ 0.2 |
Selected Balance Sheet Compon_6
Selected Balance Sheet Components -Schedule of finite-lived intangible assets (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Property, Plant and Equipment [Line Items] | ||
Total | $ 6,719 | $ 6,875 |
Licensing Agreements | ||
Property, Plant and Equipment [Line Items] | ||
Useful Life (in years) | 12 years | 12 years |
Cost | $ 7,500 | $ 7,500 |
Accumulated Amortization | (781) | (625) |
Total | $ 6,719 | $ 6,875 |
Selected Balance Sheet Compon_7
Selected Balance Sheet Components -Schedule of finite-lived intangible assets, future amortization expense (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Finite-Lived Intangible Assets [Line Items] | ||
Total | $ 6,719 | $ 6,875 |
Licensing Agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Remainder of 2024 | 469 | |
2025 | 625 | |
2026 | 625 | |
2027 | 625 | |
2028 | 625 | |
Thereafter | 3,750 | |
Total | $ 6,719 | $ 6,875 |
Selected Balance Sheet Compon_8
Selected Balance Sheet Components - Schedule of accrued expenses (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Accrued expenses | ||
Bonus-related compensation | $ 3,932 | $ 9,757 |
Employee-related accruals | 3,394 | 3,503 |
Insurance reimbursement-related liabilities | 3,385 | 3,591 |
Other accrued expenses | 315 | 364 |
Total accrued expenses | $ 11,026 | $ 17,215 |
Leases - Narrative (Details)
Leases - Narrative (Details) ft² in Thousands, $ in Thousands | 1 Months Ended | 3 Months Ended | ||||||
Jun. 01, 2023 USD ($) renewal_option $ / ft² | Jul. 29, 2022 USD ($) | Jan. 31, 2022 USD ($) | Mar. 31, 2024 USD ($) | Mar. 31, 2023 USD ($) | Dec. 31, 2023 USD ($) | Apr. 30, 2023 USD ($) | Jan. 28, 2022 ft² | |
Lessee, Lease, Description [Line Items] | ||||||||
Right-of-use assets | $ 73,682 | $ 73,462 | ||||||
Short-term lease costs (less than) | 100 | $ 100 | ||||||
Operating lease expense | 3,200 | 1,700 | ||||||
Finance lease expense (less than) | $ 100 | |||||||
25 Network Drive, Burlington, Massachusetts | ||||||||
Lessee, Lease, Description [Line Items] | ||||||||
Area of real estate property | ft² | 126 | |||||||
Percent contributed to escrow account | 50% | |||||||
Escrow deposit amount | $ 28,300 | |||||||
Rent start date, term | 13 months | |||||||
Term of contract | 144 months | |||||||
Number of renewal options | renewal_option | 1 | |||||||
Lease option to extend term | 10 years | |||||||
Annual lease per square foot | $ / ft² | 57 | |||||||
Annual lease base rent square subject to increase percentage | 2.50% | |||||||
Tenant improvement allowance per square foot | $ / ft² | 200 | |||||||
Tenant improvement allowance | $ 24,400 | |||||||
Right-of-use assets | 35,500 | $ 1,800 | ||||||
Lease liability | $ 35,500 | |||||||
Estimated incremental borrowing rate | 0.077 | |||||||
Term of contract | 13 years 1 month 6 days | |||||||
Letter of credit cash deposit | $ 6,000 | |||||||
Letter of credit cash deposit lease year three | $ 4,200 | |||||||
Letter of credit cash deposit lease year six | $ 1,800 | |||||||
Minimum | 25 Network Drive, Burlington, Massachusetts | ||||||||
Lessee, Lease, Description [Line Items] | ||||||||
Monthly contractual lease payments | $ 600 | |||||||
Maximum | 25 Network Drive, Burlington, Massachusetts | ||||||||
Lessee, Lease, Description [Line Items] | ||||||||
Monthly contractual lease payments | $ 800 |
Leases - Summary of assets and
Leases - Summary of assets and liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Assets | ||
Operating | $ 73,682 | $ 73,462 |
Current | ||
Operating | 6,012 | 6,187 |
Non-current | ||
Operating | 86,141 | 81,856 |
Total leased liabilities | $ 92,153 | $ 88,043 |
Investments (Details)
Investments (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Marketable Securities [Line Items] | |||
Amortized Cost | $ 77,385,000 | $ 65,852,000 | |
Gross Unrealized Gains | 0 | 1,000 | |
Gross Unrealized Losses | (242,000) | (101,000) | |
Credit Losses | 0 | 0 | |
Estimated Fair Value | $ 77,143,000 | $ 65,752,000 | |
Remaining contractual maturity period | 3 years | 3 years | |
Impairments of assets | $ 0 | $ 0 | |
Short-term investments | |||
Marketable Securities [Line Items] | |||
Estimated Fair Value | 47,710,000 | $ 40,469,000 | |
Long-term investments | |||
Marketable Securities [Line Items] | |||
Estimated Fair Value | 29,433,000 | 25,283,000 | |
Commercial paper | |||
Marketable Securities [Line Items] | |||
Amortized Cost | 7,396,000 | 3,638,000 | |
Gross Unrealized Gains | 0 | 1,000 | |
Gross Unrealized Losses | (13,000) | 0 | |
Credit Losses | 0 | 0 | |
Estimated Fair Value | 7,383,000 | 3,639,000 | |
Corporate notes | |||
Marketable Securities [Line Items] | |||
Amortized Cost | 56,803,000 | 47,228,000 | |
Gross Unrealized Gains | 0 | 0 | |
Gross Unrealized Losses | (199,000) | (69,000) | |
Credit Losses | 0 | 0 | |
Estimated Fair Value | 56,604,000 | 47,159,000 | |
U.S. government securities | |||
Marketable Securities [Line Items] | |||
Amortized Cost | 2,473,000 | 983,000 | |
Gross Unrealized Gains | 0 | 0 | |
Gross Unrealized Losses | (1,000) | 0 | |
Credit Losses | 0 | 0 | |
Estimated Fair Value | 2,472,000 | 983,000 | |
U.S. government agency bonds | |||
Marketable Securities [Line Items] | |||
Amortized Cost | 10,713,000 | 14,003,000 | |
Gross Unrealized Gains | 0 | 0 | |
Gross Unrealized Losses | (29,000) | (32,000) | |
Credit Losses | 0 | 0 | |
Estimated Fair Value | $ 10,684,000 | $ 13,971,000 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 |
Liabilities that are measured at fair value on a recurring basis | ||
Debt securities, fair value | $ 77,143 | $ 65,752 |
Commercial paper | ||
Liabilities that are measured at fair value on a recurring basis | ||
Debt securities, fair value | 7,383 | 3,639 |
U.S. government agency bonds | ||
Liabilities that are measured at fair value on a recurring basis | ||
Debt securities, fair value | 10,684 | 13,971 |
U.S. government securities | ||
Liabilities that are measured at fair value on a recurring basis | ||
Debt securities, fair value | 2,472 | 983 |
Recurring | ||
Liabilities that are measured at fair value on a recurring basis | ||
Assets, fair value | 136,543 | 125,552 |
Recurring | Level 1 | ||
Liabilities that are measured at fair value on a recurring basis | ||
Assets, fair value | 36,617 | 34,672 |
Recurring | Level 2 | ||
Liabilities that are measured at fair value on a recurring basis | ||
Assets, fair value | 99,926 | 90,880 |
Recurring | Level 3 | ||
Liabilities that are measured at fair value on a recurring basis | ||
Assets, fair value | 0 | 0 |
Recurring | Commercial paper | ||
Liabilities that are measured at fair value on a recurring basis | ||
Debt securities, fair value | 8,873 | 4,876 |
Recurring | Commercial paper | Cash and cash equivalents | ||
Liabilities that are measured at fair value on a recurring basis | ||
Debt securities, fair value | 1,500 | 1,200 |
Recurring | Commercial paper | Level 1 | ||
Liabilities that are measured at fair value on a recurring basis | ||
Debt securities, fair value | 0 | 0 |
Recurring | Commercial paper | Level 2 | ||
Liabilities that are measured at fair value on a recurring basis | ||
Debt securities, fair value | 8,873 | 4,876 |
Recurring | Commercial paper | Level 3 | ||
Liabilities that are measured at fair value on a recurring basis | ||
Debt securities, fair value | 0 | 0 |
Recurring | Corporate notes | ||
Liabilities that are measured at fair value on a recurring basis | ||
Debt securities, fair value | 56,606 | 47,159 |
Recurring | Corporate notes | Level 1 | ||
Liabilities that are measured at fair value on a recurring basis | ||
Debt securities, fair value | 0 | 0 |
Recurring | Corporate notes | Level 2 | ||
Liabilities that are measured at fair value on a recurring basis | ||
Debt securities, fair value | 56,606 | 47,159 |
Recurring | Corporate notes | Level 3 | ||
Liabilities that are measured at fair value on a recurring basis | ||
Debt securities, fair value | 0 | 0 |
Recurring | U.S. government agency bonds | ||
Liabilities that are measured at fair value on a recurring basis | ||
Debt securities, fair value | 10,684 | 13,971 |
Recurring | U.S. government agency bonds | Level 1 | ||
Liabilities that are measured at fair value on a recurring basis | ||
Debt securities, fair value | 0 | 0 |
Recurring | U.S. government agency bonds | Level 2 | ||
Liabilities that are measured at fair value on a recurring basis | ||
Debt securities, fair value | 10,684 | 13,971 |
Recurring | U.S. government agency bonds | Level 3 | ||
Liabilities that are measured at fair value on a recurring basis | ||
Debt securities, fair value | 0 | 0 |
Recurring | U.S. government securities | ||
Liabilities that are measured at fair value on a recurring basis | ||
Debt securities, fair value | 23,763 | 24,874 |
Recurring | U.S. government securities | Cash and cash equivalents | ||
Liabilities that are measured at fair value on a recurring basis | ||
Debt securities, fair value | 21,300 | 23,900 |
Recurring | U.S. government securities | Level 1 | ||
Liabilities that are measured at fair value on a recurring basis | ||
Debt securities, fair value | 0 | 0 |
Recurring | U.S. government securities | Level 2 | ||
Liabilities that are measured at fair value on a recurring basis | ||
Debt securities, fair value | 23,763 | 24,874 |
Recurring | U.S. government securities | Level 3 | ||
Liabilities that are measured at fair value on a recurring basis | ||
Debt securities, fair value | 0 | 0 |
Recurring | Money market funds | ||
Liabilities that are measured at fair value on a recurring basis | ||
Money market funds | 36,617 | 34,672 |
Recurring | Money market funds | Level 1 | ||
Liabilities that are measured at fair value on a recurring basis | ||
Money market funds | 36,617 | 34,672 |
Recurring | Money market funds | Level 2 | ||
Liabilities that are measured at fair value on a recurring basis | ||
Money market funds | 0 | 0 |
Recurring | Money market funds | Level 3 | ||
Liabilities that are measured at fair value on a recurring basis | ||
Money market funds | $ 0 | $ 0 |
Revolving Credit Agreement (Det
Revolving Credit Agreement (Details) - Line of credit | Jul. 29, 2022 USD ($) | Mar. 31, 2024 USD ($) |
Debt Instrument [Line Items] | ||
Issuance of letters of credit | $ 6,200,000 | |
Revolving credit facility | ||
Debt Instrument [Line Items] | ||
Maximum borrowing capacity | $ 150,000,000 | |
Debt instrument, term | 5 years | |
Debt issuance costs, net | $ 1,100,000 | |
Outstanding borrowings | $ 0 | |
Leverage ratio | 3.50 | |
Increase option for leverage ratio | 4 | |
Revolving credit facility | Minimum | ||
Debt Instrument [Line Items] | ||
Line of credit facility, commitment fee (in percent) | 0.20% | |
Revolving credit facility | Maximum | ||
Debt Instrument [Line Items] | ||
Line of credit facility, commitment fee (in percent) | 0.25% | |
Revolving credit facility | SOFR | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate (in percent) | 0.10% | |
Revolving credit facility | SOFR | Minimum | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate (in percent) | 1.25% | |
Revolving credit facility | SOFR | Maximum | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate (in percent) | 2.50% | |
Revolving credit facility | Base rate | Minimum | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate (in percent) | 0.25% | |
Revolving credit facility | Base rate | Maximum | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate (in percent) | 1.50% | |
Letter of credit | ||
Debt Instrument [Line Items] | ||
Maximum borrowing capacity | $ 15,000,000 |
Stock-Based Compensation - Expe
Stock-Based Compensation - Expense (Details) - Employee stock purchase plan and service-based stock options - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total non-cash stock-based compensation expense | $ 9,834 | $ 8,731 |
Cost of product sales | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total non-cash stock-based compensation expense | 1,241 | 885 |
Research and development | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total non-cash stock-based compensation expense | 1,221 | 977 |
Selling, general and administrative | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total non-cash stock-based compensation expense | $ 7,372 | $ 6,869 |
Stock-Based Compensation - Narr
Stock-Based Compensation - Narrative (Details) - $ / shares | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Stock-Based Compensation | ||
Granted (in shares) | 507,162 | 467,957 |
Weighted average grant-date fair value (in dollars per share) | $ 28.21 | $ 18 |
Restricted stock units | ||
Stock-Based Compensation | ||
Restricted stock units granted (shares) | 538,425 | 496,505 |
Weighted-average grant date fair value (in dollars per share) | $ 48.25 | $ 29.82 |
Net Loss Per Common Share (Deta
Net Loss Per Common Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Net Income (Loss) Attributable to Parent [Abstract] | ||
Net loss | $ (3,862) | $ (7,495) |
Basic weighted-average common shares outstanding (in shares) | 48,141 | 47,387 |
Effect of dilutive stock options and restricted stock units (in shares) | 0 | 0 |
Diluted weighted-average common shares outstanding (in shares) | 48,141 | 47,387 |
Basic loss per common share (in USD per share) | $ (0.08) | $ (0.16) |
Diluted loss per common share (in USD per share) | $ (0.08) | $ (0.16) |
Stock options | ||
Anti-dilutive shares excluded from diluted net loss per common share: | ||
Anti-dilutive shares excluded from the calculation of diluted earnings per share (in shares) | 6,730 | 6,918 |
Restricted stock units | ||
Anti-dilutive shares excluded from diluted net loss per common share: | ||
Anti-dilutive shares excluded from the calculation of diluted earnings per share (in shares) | 1,201 | 954 |
NexoBrid License and Supply A_2
NexoBrid License and Supply Agreements (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||
Feb. 28, 2023 | May 31, 2019 | Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2022 | |
Related Party Transaction [Line Items] | |||||
Purchases of intangible assets | $ 0 | $ 7,500 | |||
MediWound Ltd | |||||
Related Party Transaction [Line Items] | |||||
Consideration payment for license | $ 17,500 | ||||
Contingent consideration | 7,500 | $ 7,500 | |||
Milestone payments, assumed intangible assets | $ 7,500 | ||||
Purchases of intangible assets | $ 7,500 | ||||
Maximum contingent consideration | 125,000 | ||||
Sales threshold for first milestone | $ 75,000 | ||||
Term of supply agreement | 5 years | ||||
Renewal term of supply agreement | 24 months | ||||
Supply agreement additional term | 10 years |