Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
In Millions, except Share data, unless otherwise specified | Dec. 31, 2014 | Mar. 18, 2015 | Jun. 30, 2014 |
Document and Entity Information | |||
Entity Registrant Name | Sunshine Heart, Inc. | ||
Entity Central Index Key | 1506492 | ||
Document Type | 10-K | ||
Document Period End Date | 31-Dec-14 | ||
Amendment Flag | FALSE | ||
Current Fiscal Year End Date | -19 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Public Float | $93.50 | ||
Entity Common Stock, Shares Outstanding | 18,231,091 | ||
Document Fiscal Year Focus | 2014 | ||
Document Fiscal Period Focus | FY |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Current assets | ||
Cash and cash equivalents | $31,293 | $54,136 |
Accounts receivable | 59 | 59 |
Other current assets | 360 | 448 |
Total current assets | 31,712 | 54,643 |
Property, plant and equipment, net | 661 | 587 |
TOTAL ASSETS | 32,373 | 55,230 |
Current liabilities | ||
Accounts payable | 2,079 | 2,188 |
Accrued salaries, wages, and other compensation | 1,079 | 1,315 |
Total current liabilities | 3,158 | 3,503 |
Total liabilities | 3,158 | 3,503 |
Commitments and contingencies (Note 6) | ||
Stockholders' equity | ||
Common stock as of December 31, 2014 and December 31, 2013, par value $0.0001 per share; authorized 100,000,000 shares; issued and outstanding 16,982,642 and 16,825,284, respectively | 2 | 2 |
Additional paid-in capital | 154,540 | 151,530 |
Accumulated other comprehensive income: | ||
Foreign currency translation adjustment | 1,272 | 1,207 |
Accumulated deficit | -126,599 | -101,012 |
Total stockholders' equity | 29,215 | 51,727 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | 32,373 | 55,230 |
Series A junior participating preferred stock | ||
Stockholders' equity | ||
Preferred stock | ||
Preferred stock | ||
Stockholders' equity | ||
Preferred stock |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Common stock, par value (in dollars per share) | $0.00 | $0.00 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 16,982,642 | 16,825,284 |
Common stock, shares outstanding | 16,982,642 | 16,825,284 |
Series A junior participating preferred stock | ||
Preferred Stock, par value (in dollars per share) | $0.00 | $0.00 |
Preferred Stock, shares authorized | 30,000 | 30,000 |
Preferred Stock, shares outstanding | 0 | 0 |
Preferred stock | ||
Preferred Stock, par value (in dollars per share) | $0.00 | $0.00 |
Preferred Stock, shares authorized | 39,970,000 | 39,970,000 |
Preferred Stock, shares outstanding | 0 | 0 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations and Comprehensive Loss (USD $) | 12 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Consolidated Statements of Operations and Comprehensive Loss | ||
Net sales | $295 | $59 |
Operating expenses | ||
Selling, general and administrative | 9,208 | 9,426 |
Research and development | 16,874 | 13,504 |
Total operating expenses | 26,082 | 22,930 |
Loss from operations | -25,787 | -22,871 |
Other expense, net | -49 | -100 |
Loss before income taxes | -25,836 | -22,971 |
Income tax benefit, net | 249 | 1,213 |
Net loss | -25,587 | -21,758 |
Basic and diluted loss per share (in dollars per share) | ($1.51) | ($1.71) |
Weighted average shares outstanding-basic and diluted (in shares) | 16,899 | 12,723 |
Other comprehensive income: | ||
Foreign currency translation adjustment | 65 | 22 |
Total comprehensive loss | ($25,522) | ($21,736) |
Consolidated_Statements_of_Sto
Consolidated Statements of Stockholders' Equity (USD $) | Common Stock | Additional Paid in Capital | Accumulated Other Comprehensive Income | Accumulated Deficit | Total |
In Thousands, except Share data, unless otherwise specified | |||||
Balance at Dec. 31, 2012 | $1 | $91,017 | $1,185 | ($79,254) | $12,949 |
Balance (in shares) at Dec. 31, 2012 | 9,283,000 | ||||
Increase (Decrease) in Shareholders' Equity | |||||
Net loss | -21,758 | -21,758 | |||
Foreign currency translation adjustment | 22 | 22 | |||
Stock based compensation, net | 2,804 | 2,804 | |||
Stock based compensation (in shares) | 56,000 | ||||
Reclassification of stock options as liability awards | -95 | -95 | |||
Issuance of common stock, net | 1 | 57,565 | 57,566 | ||
Issuance of common stock, net (in shares) | 7,486,000 | ||||
Issuance of warrants for service agreement | 239 | 239 | |||
Balance at Dec. 31, 2013 | 2 | 151,530 | 1,207 | -101,012 | 51,727 |
Balance (in shares) at Dec. 31, 2013 | 16,825,000 | 16,825,284 | |||
Increase (Decrease) in Shareholders' Equity | |||||
Net loss | -25,587 | -25,587 | |||
Foreign currency translation adjustment | 65 | 65 | |||
Stock based compensation, net | 2,678 | 2,678 | |||
Settlement of liability awards | 243 | 243 | |||
Issuance of common stock, net | 89 | 89 | |||
Issuance of common stock, net (in shares) | 158,000 | ||||
Balance at Dec. 31, 2014 | $2 | $154,540 | $1,272 | ($126,599) | $29,215 |
Balance (in shares) at Dec. 31, 2014 | 16,983,000 | 16,982,642 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Operating Activities | ||
Net loss | ($25,587) | ($21,758) |
Adjustments to reconcile net loss to cash flows from operating activities: | ||
Depreciation | 277 | 185 |
Stock based compensation expense, net | 2,678 | 2,953 |
Amortization of warrants for service agreements | 239 | |
Changes in assets and liabilities: | ||
Accounts receivable | -59 | |
Other current assets | -5 | -22 |
Accounts payable and accrued expenses | -7 | 1,100 |
Net cash used in operations | -22,644 | -17,362 |
Investing activities: | ||
Purchase of property and equipment | -351 | -293 |
Net cash used in investing activities | -351 | -293 |
Financing activities: | ||
Net proceeds from the sale of common stock | 89 | 57,566 |
Net cash provided by financing activities | 89 | 57,566 |
Effect of exchange rate changes on cash | 63 | 1 |
Net increase (decrease) in cash and cash equivalents | -22,843 | 39,912 |
Cash and cash equivalents-beginning of period | 54,136 | 14,224 |
Cash and cash equivalents-end of period | 31,293 | 54,136 |
Supplemental Schedule of non-cash activities | ||
Stock options and restricted stock units classified as liabilities, net | $206 |
Nature_of_Business_and_Signifi
Nature of Business and Significant Accounting Policies | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Nature of Business and Significant Accounting Policies | ||||
Nature of Business and Significant Accounting Policies | Note 1—Nature of Business and Significant Accounting Policies | |||
Nature of Business | ||||
Sunshine Heart, Inc. was founded in November 1999 and incorporated in Delaware in August 2002. The Company is headquartered in Eden Prairie, Minnesota and has a wholly owned subsidiary, Sunshine Heart Company Pty Limited, located in Clontarf, New South Wales, Australia and a wholly owned subsidiary, Sunshine Heart Ireland Limited, located in Dublin, Ireland. The Company is a medical device company developing innovative technologies for cardiac and coronary disease. The Company’s primary product, the C-Pulse System, is an implantable, non-blood contacting, heart assist therapy for the treatment of moderate to severe heart failure which can be implanted using a minimally invasive procedure. The C-Pulse System is designed to relieve the symptoms of heart failure through the use of counter-pulsation technology by enabling an increase in cardiac output, an increase in coronary blood flow, and a reduction in the heart’s pumping load. The Company has received approval from the US Food and Drug Administration (“FDA”) to conduct a U.S. feasibility clinical study with the C-Pulse System. Commencing February 16, 2012, the Company’s shares of common stock began trading on NASDAQ under the symbol “SSH.” The Company’s shares of common stock previously traded in the form of CDIs on the ASX under the symbol “SHC” from September 2004 until the Company’s delisting from the ASX, which occurred at the close of trading on May 6, 2013. | ||||
Going Concern | ||||
The Company’s financial statements have been prepared and presented on a basis assuming it continues as a going concern. | ||||
During the years ended December 31, 2014 and 2013, the Company incurred losses from operations and net cash outflows from operating activities as disclosed in the consolidated statements of operations and comprehensive loss and cash flows, respectively. At December 31, 2014, the Company had an accumulated deficit of $126.6 million and expects to incur losses for the foreseeable future. To date, the Company has been funded by private and public equity financings. Although the Company believes that it will be able to successfully fund its operations, there can be no assurance the Company will be able to do so or that the Company will ever operate profitably. | ||||
The Company’s ability to continue as a going concern is dependent on the Company’s ability to raise additional capital based on the achievement of existing milestones as and when required. Should future capital raising be unsuccessful, the Company may not be able to continue as a going concern. Furthermore, the ability of the Company to continue as a going concern is subject to the ability of the Company to develop and successfully commercialize the product being developed. If the Company is unable to obtain such funding of an amount and timing necessary to meet its future operational plans, or to successfully commercialize its intellectual property, the Company may be unable to continue as a going concern. No adjustments have been made relating to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company not continue as a going concern. | ||||
Basis of Presentation | ||||
The accompanying consolidated financial statements include the accounts of Sunshine Heart, Inc. and its wholly owned subsidiaries, Sunshine Heart Company Pty Limited and Sunshine Heart Ireland Limited. All inter-company accounts and transactions between consolidated entities have been eliminated. | ||||
Use of Estimates | ||||
The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts and disclosures in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. | ||||
Fair Value of Financial Instruments | ||||
The Company’s financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities. The Company believes that the carrying amounts of the financial instruments approximate their respective current fair values due to their relatively short maturities. | ||||
Pursuant to the requirements of Financial Accounting Standards Board (the “FASB”) Accounting Standards Codification (the “ASC”) Topic 820 “Fair Value Measurement,” the Company’s financial assets and liabilities measured at fair value on a recurring basis are classified and disclosed in one of the following three categories: | ||||
· | Level 1 - Financial instruments with unadjusted quoted prices listed on active market exchanges. | |||
· | Level 2 - Financial instruments lacking unadjusted, quoted prices from active market exchanges, including over the counter traded financial instruments. The prices for the financial instruments are determined using prices for recently traded financial instruments with similar underlying terms as well as directly or indirectly observable inputs, such as interest rates and yield curves that are observable at commonly quoted intervals. | |||
· | Level 3 - Financial instruments that are not actively traded on a market exchange. This category includes situations where there is little, if any, market activity for the financial instrument. The prices are determined using significant unobservable inputs or valuation techniques. | |||
All cash equivalents are considered Level 1 measurements for all periods presented. The Company does not have any financial instruments classified as Level 2 or Level 3 and there were no movements between these categories during the years ended December 31, 2014 and 2013. | ||||
Cash and Cash Equivalents | ||||
Cash and cash equivalents consist of cash and term deposits with original maturities of three months or less. The carrying value of these instruments approximate fair value. The balances, at times, may exceed federally insured limits. The Company has not experienced any losses on its cash and cash equivalents. | ||||
Accounts Receivable | ||||
Accounts receivable are unsecured, are recorded at net realizable value, and do not bear interest. The Company makes judgments as to its ability to collect outstanding receivables based upon significant patterns of uncollectiblity, historical experience, and managements’ evaluation of specific accounts and will provide an allowance for credit losses when collection becomes doubtful. The Company performs credit evaluations of its customers’ financial condition on an as-needed basis. Payment is generally due 30 days from the invoice date and accounts past 30 days are individually analyzed for collectability. When all collection efforts have been exhausted, the account is written off against the related allowance. No allowance for doubtful accounts was considered necessary as of December 31, 2014 and 2013. | ||||
Other Current Assets | ||||
Other current assets represent prepayments and deposits made by the Company. | ||||
Property, Plant and Equipment | ||||
Property and equipment is stated at cost less accumulated depreciation. Depreciation is computed based upon the estimated useful lives of the respective assets. Leasehold improvements are amortized using the straight-line method over the shorter of the lease term or the estimated useful life of the assets. Repairs and maintenance costs are expensed as incurred. The cost and accumulated depreciation of property, plant and equipment retired, or otherwise disposed of are removed from the related accounts, and any residual values are charged to expense. Depreciation expense has been calculated using the following estimated useful lives: | ||||
Office furniture and equipment | 5-15 years | |||
Computer software and equipment | 3-4 years | |||
Laboratory and research equipment | 3-15 years | |||
Production equipment | 3-7 years | |||
Depreciation expense was $277 and $185 for the years ended December 31, 2014 and 2013, respectively. | ||||
Property and equipment are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset or asset group may not be recoverable. If the impairment tests indicate that the carrying value of the asset, or asset group is greater than the expected undiscounted cash flows to be generated by such asset or asset group further analysis is performed to determine the fair value of the asset or asset group. To the extent the fair value of the asset or asset group is less than its carrying value, an impairment loss is recognized equal to the amount the fair value of the asset or asset group exceeds its carrying amount. The Company generally measures fair value by considering sale prices for similar assets or asset groups, or by discounting estimated future cash flows from such assets or asset groups using an appropriate discount rate. Assets to be disposed of are carried at the lower of their carrying value or fair value less costs to sell. Considerable management judgment is necessary to estimate the fair value of assets or asset groups, and accordingly, actual results could vary significantly from such estimates. There have been no impairment losses recognized for the years ended December 31, 2014 or 2013. | ||||
Revenue Recognition | ||||
The Company recognizes revenue when (i) persuasive evidence of a customer arrangement exists; (ii) the price is fixed or determinable and free of contingencies or uncertainties; (iii) collectability is reasonably assured; and (iv) product delivery has occurred, which is when product title transfers to the customer, or services have been rendered. Sales are not conditional based on customer acceptance provisions or installation obligations. The C-Pulse System is not approved for commercial sale. However, the FDA has assigned the C-Pulse System to a Category B designation, making it eligible for reimbursement at certain U.S. sites during the Company’s clinical studies. Consequently, the Company is able to invoice hospitals and clinics that are eligible for reimbursement by Medicare, Medicaid or private insurance companies. The Company’s revenue consists solely of sales of the C-Pulse System to hospitals and clinics who participate in the Company’s clinical studies per the terms of the clinical study contracts. For clinical study implant revenue, the product title generally transfers on the date the product is implanted. Product costs incurred for the Company’s clinical studies are deemed to be development costs and are expensed to research and development as incurred. Upon commercialization, product costs will be capitalized in inventory and recorded to cost of sales as the inventory is sold. The Company does not charge hospitals and clinics for shipping. The Company expenses shipping costs at the time of shipment. | ||||
Foreign Currency Translation | ||||
Sales and expenses denominated in foreign currencies are translated at average exchange rates in effect throughout the year. Assets and liabilities of foreign operations are translated at period-end exchange rates with the impacts of foreign currency translation recognized to cumulative translation adjustment, a component of accumulated other comprehensive income. Foreign currency transactions gains and losses are included in other expense, net in the consolidated statements of operations and other comprehensive loss. | ||||
Stock-Based Compensation | ||||
The Company recognizes all share-based payments to employees and directors, including grants of stock options, restricted stock units (RSUs) and common stock awards in the income statement as an operating expense, based on their fair value. The Company’s stock awards use a graded vesting schedule. The Company recognizes the option expense over the requisite service period, which is generally the vesting period. | ||||
The Company computes the estimated fair values of stock options and warrants using the Black-Scholes option pricing model. The closing market price of the Company’s common stock at the date of grant is used to calculate the fair value of restricted stock units and common stock awards. No tax benefit has been recorded in connection with these awards as the Company has provided a full valuation allowance on its deferred tax assets. | ||||
Stock-based compensation expense is based on awards ultimately expected to vest and is reduced for estimated forfeitures. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. | ||||
Equity instruments issued to non-employees include RSUs, warrants or options to purchase shares of the Company’s common stock. These RSUs, warrants or options are either fully-vested and exercisable at the date of grant or vest over a certain period during which services are provided. The Company expenses the fair market value of fully vested awards at the time of grant, and of unvested awards over the period in which the related services are received. Unvested awards are remeasured to fair value until they vest. | ||||
See Note 4 for further information regarding the assumptions used to calculate the fair value of share-based compensation. | ||||
Income Taxes | ||||
Deferred income taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carryforwards. Deferred tax liabilities are recognized for taxable temporary differences, which are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. | ||||
Net Loss per Share | ||||
Basic net loss attributable to common stockholders, on a per share basis, is computed by dividing income available to common stockholders (the numerator) by the weighted-average number of common shares outstanding (the denominator) during the period. Shares issued during the period and shares reacquired during the period are weighted for the portion of the period that they were outstanding. The computation of diluted earnings per share (“EPS”) is similar to the computation of basic EPS except that the denominator is increased to include the number of additional common shares that would have been outstanding if the dilutive potential common shares had been issued and computed in accordance with the treasury stock method. In addition, in computing the dilutive effect of convertible securities, the numerator is adjusted to add back the after-tax amount of interest recognized in the period associated with any convertible debt. Shares reserved for outstanding stock warrants and options and restricted stock units totaling 2,832,194 and 3,623,806 for the years ended December 31, 2014 and 2013, respectively, were excluded from the computation of loss per share as their effect was antidilutive due to the Company’s net loss in each of those years. | ||||
Research and Development | ||||
Research and development expenses consist primarily of development personnel and non-employee contractor costs related to the development of new products and services, enhancement of existing products and services, quality assurance and testing. The Company incurred research and development expenses of $16,874 and $13,504 for the years ended December 31, 2014 and 2013, respectively. | ||||
Recent Accounting Pronouncements | ||||
In May 2014, the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606) (ASU 2014-09). This standard is a comprehensive new revenue recognition model that creates a single source of revenue guidance for all companies in all industries. The model is more principle-based than current guidance, and is primarily based on recognizing revenue in an amount that reflects the consideration to which the entity expects to be entitled in exchange for transferring goods or services to a customer. The guidance of ASU 2014-09 will be effective for the Company’s interim and annual reporting periods beginning January 1, 2017. The standard allows the Company to transition to the new model using either a full or modified retrospective approach, and early adoption is not permitted. The Company is currently evaluating the impact that this standard will have on its business practices, financial condition, results of operations and disclosures. | ||||
In August 2014, the FASB issued ASU 2014-15, Presentation of Financial Statements - Going Concern (Subtopic 205-40); Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern, which explicitly requires management of a company to evaluate whether there is substantial doubt about a company’s ability to continue as a going concern and to provide related footnote disclosure in certain circumstances. This guidance is effective for the Company’s interim and annual reporting periods beginning January 1, 2017, with early adoption permitted. The Company is evaluating the impact that the adoption of this standard will have, if any, on its financial statements and disclosures. | ||||
The Company evaluates events through the date the financial statements are filed for events requiring adjustment to or disclosure in the financial statements. | ||||
Balance_Sheet_Information
Balance Sheet Information | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Balance Sheet Information | ||||||||
Balance Sheet Information | ||||||||
Note 2—Balance Sheet Information | ||||||||
Property, Plant and Equipment | ||||||||
Property, plant and equipment were as follows: | ||||||||
December 31, 2014 | December 31, 2013 | |||||||
Office Furniture & Fixtures | $ | 229 | $ | 111 | ||||
Leasehold Improvements | 145 | 145 | ||||||
Software | 65 | 61 | ||||||
Production Equipment | 786 | 574 | ||||||
Computer Equipment | 221 | 204 | ||||||
Total | 1,446 | 1,095 | ||||||
Accumulated Depreciation | (785 | ) | (508 | ) | ||||
$ | 661 | $ | 587 | |||||
Shareholders_Equity
Shareholder's Equity | 12 Months Ended |
Dec. 31, 2014 | |
Shareholder's Equity | |
Shareholder's Equity | Note 3—Shareholder’s Equity |
Stockholder Rights Plan | |
On June 14, 2013, the Company adopted a stockholder rights plan (the “Rights Plan”), which entitles the holders of the rights to purchase from the Company 1/1,000th of a share of Series A Junior Participating Preferred Stock, par value $0.0001 per share, at a purchase price of $35.00 per share, as adjusted (a “Right”), upon certain trigger events. In connection therewith, on June 14, 2013, the Company’s board of directors authorized 30,000 shares of Series A Junior Participating Preferred Stock and it declared a dividend of one Right per each share of common stock of the Company outstanding as of June 24, 2013. Each 1/1,000th of a share of Series A Junior Participating Preferred Stock has terms that are substantially the economic and voting equivalent of one share of the Company’s common stock. However, until a Right is exercised or exchanged in accordance with the provisions of the Rights Plan, the holder thereof will have no rights as a stockholder of the Company, including, but not limited to, the right to vote for the election of directors or upon any matter submitted to stockholders of the Company. The Rights Plan has a three-year term and the board of directors may terminate the Rights Plan at any time (subject to the redemption of the Rights for a nominal value). The Rights may cause substantial dilution to a person or group (together with all affiliates and associates of such person or group and any person or group of persons acting in concert therewith) that acquires beneficial ownership of 15% or more of the Company’s stock on terms not approved by the board of directors or takes other specified actions. | |
Common Stock Purchase Agreement | |
On January 15, 2013, the Company entered into a Common Stock Purchase Agreement (the “Purchase Agreement”) with Aspire Capital Fund, LLC (“Aspire Capital”), which provides that, upon the terms and subject to the conditions and limitations set forth therein, Aspire Capital is committed to purchase up to an aggregate of $25 million in shares of the Company’s common stock (the “Purchase Shares”) over an approximately two-year period, terminating February 19, 2015, at purchase prices determined in accordance with the Purchase Agreement. Pursuant to the terms of the Purchase Agreement, the Company has filed and maintains a registration statement on Form S-1 with the SEC under which the Company has registered 3,000,000 shares of its common stock for resale by Aspire Capital. | |
The Purchase Agreement contains customary representations, warranties, covenants, closing conditions and indemnification and termination provisions by, among and for the benefit of the parties to the Purchase Agreement. The Purchase Agreement may be terminated by the Company at any time, at the Company’s discretion, without any cost or penalty to the Company. Aspire Capital has covenanted not to cause or engage in any manner whatsoever, any direct or indirect short selling or hedging of the Company’s shares. The Company did not pay Aspire Capital any expense reimbursement in connection with the transaction. There are no limitations on use of proceeds, financial or business covenants, and restrictions on future financings, rights of first refusal, participation rights, penalties or liquidated damages in the Purchase Agreement. | |
In consideration for entering into the Purchase Agreement, concurrently with the execution of the Purchase Agreement, the Company issued to Aspire Capital 80,257 shares of the Company’s common stock as a commitment fee (the “Commitment Shares”). The Purchase Agreement provides that the Company may not issue and sell more than 1,856,616 shares, or 19.99% of the Company’s outstanding shares as of January 15, 2013. | |
As of December 31, 2014, the Company had sold 146,886 shares of common stock to Aspire Capital pursuant to the Purchase Agreement. Including the Commitment Shares, an aggregate of 227,143 shares of common stock were issued to Aspire Capital pursuant to the Purchase Agreement. There were no further issuances under the Purchase Agreement subsequent to December 31, 2014. The Purchase Agreement expired on February 19, 2015. | |
Public Offerings | |
On April 16, 2013, the Company sold 2,875,000 shares of common stock in a public offering at $5.25 per share, including 375,000 shares of common stock pursuant to the exercise of the over-allotment option by the Company’s underwriters. Proceeds in the public offering and exercise of the over-allotment option, net of transaction costs were $14,036 in the aggregate. | |
On September 24, 2013, the Company sold 4,381,500 shares of common stock in a public offering at $10.50 per share, including 571,500 shares of common stock pursuant to the exercise of the over-allotment option by the Company’s underwriters. Proceeds in the public offering and exercise of the over-allotment option, net of transaction costs were $42,674 in the aggregate. | |
ATM Sales | |
On March 21, 2014, the Company entered into a sales agreement (the “Sales Agreement”) with Cowen and Company LLC (“Cowen”). Under the Sales Agreement, the Company may sell from time to time, in “at the market” offerings, shares of its common stock registered under its currently effective registration statement on Form S-3. On March 21, 2014, the Company filed a prospectus supplement with the SEC in connection with the offering, relating to shares of its common stock having an aggregate offering price of up to $40.0 million. The Company pays Cowen a commission of up to 3.0% of the gross proceeds from the sale of any shares pursuant to the Sales Agreement. | |
From November 17, 2014 to December 31, 2014, the Company sold 23,120 shares of common stock for net proceeds of $73, after stock issuance costs of $32. As of December 31, 2014, the Company has a total of $39.9 million available for future sales under the Sales Agreement. Subsequent to year end, from January 1, 2015 to February 27, 2015, the Company sold 1,214,395 shares of common stock for net proceeds of $6.9 million after stock issuance costs of $0.2 million. | |
StockBased_Compensation
Stock-Based Compensation | 12 Months Ended | |||||||||||
Dec. 31, 2014 | ||||||||||||
Stock-Based Compensation | ||||||||||||
Stock-Based Compensation | ||||||||||||
Note 4— Stock-Based Compensation | ||||||||||||
Stock Options and Restricted Stock Awards | ||||||||||||
The Company has various share-based compensation plans, including the Amended and Restated 2002 Stock Plan, the Second Amended and Restated 2011 Equity Incentive Plan, the 2013 Non-Employee Directors’ Equity Incentive Plan and the New-Hire Equity Incentive Plan (collectively, the “Plans”). The Plans are designed to assist in attracting, motivating and retaining employees and directors and to recognize the importance of employees to the long-term performance and success of the Company. The Company has also granted stock options to certain non-employees outside of the Plans. | ||||||||||||
The Company recognized share-based compensation expense related to grants of stock options, RSUs and common stock awards to employees, directors and consultants of $3,085 and $3,604 during the years ended December 31, 2014 and 2013, respectively. The following table summarizes the stock-based compensation expense which was recognized in the consolidated statements of operations for the years ended: | ||||||||||||
December 31, 2014 | December 31, 2013 | |||||||||||
Selling, general and administrative | $ | 2,241 | $ | 2,722 | ||||||||
Research and development | 844 | 882 | ||||||||||
Total | $ | 3,085 | $ | 3,604 | ||||||||
The majority of the RSUs and options to purchase common stock vest on the anniversary of the date of grant, which ranges from one to four years. Share-based compensation expense related to these awards is recognized on a straight-line basis over the related vesting term in most cases, which generally is the service period. It is the Company’s policy to issue new shares upon the exercise of options. | ||||||||||||
Stock Options: The following is a summary of the Plan’s stock option activity during the years ended December 31, 2014 and 2013. | ||||||||||||
2014 | 2013 | |||||||||||
Options | Weighted | Options | Weighted | |||||||||
Outstanding | Average | Outstanding | Average | |||||||||
Exercise | Exercise | |||||||||||
Price | Price | |||||||||||
Beginning Balance | 1,886,579 | $ | 8.8 | 1,113,244 | $ | 9.47 | ||||||
Granted | 776,348 | 5.37 | 905,900 | 8.17 | ||||||||
Exercised | (16,580 | ) | 5.88 | — | — | |||||||
Forfeited/expired | (475,854 | ) | 10.98 | (132,565 | ) | 10.06 | ||||||
Outstanding at December 31 | 2,170,493 | $ | 6.51 | 1,886,579 | $ | 8.8 | ||||||
Exercisable at December 31 | 995,351 | $ | 7.18 | 801,480 | $ | 8.95 | ||||||
For options outstanding and exercisable at December 31, 2014, the weighted average remaining contractual life was 8.07 years and 7.05 years, respectively. The total intrinsic value, calculated as the closing stock price at year-end less the option exercise price, of options exercised during 2014 was $56. There were no option exercises in 2013. | ||||||||||||
Valuation Assumptions: The fair value of each stock option is estimated at the grant date using the Black-Scholes option pricing model. The fair value of stock options under the Black-Scholes model requires management to make assumptions regarding projected employee stock option exercise behaviors, risk-free interest rates, volatility of the Company’s stock price, and expected dividends. | ||||||||||||
The Company has not historically paid cash dividends to its stockholders, and currently does not anticipate paying any cash dividends in the foreseeable future. As a result the Company has assumed a dividend yield of 0%. The risk free interest rate is based upon the rates of U.S. Treasury bills with a term that approximates the expected life of the option. Since the Company has limited historical exercise data to reasonably estimate the expected life of its option awards, the expected life is calculated using a simplified method. Expected volatility is based on historical volatility of the Company’s stock. | ||||||||||||
The following table provides the assumptions used in the Black-Scholes model: | ||||||||||||
Year ended December 31 | ||||||||||||
2014 | 2013 | |||||||||||
Expected dividend yield | 0% | 0% | ||||||||||
Risk-free interest rate | 2.12% | 1.31% | ||||||||||
Expected volatility | 91% | 96% | ||||||||||
Expected life (in years) | 6.25 | 5.5 | ||||||||||
The weighted-average fair value of stock options granted in 2014 and 2013 was $4.05 and $5.54, respectively. As of December 31, 2014, the total compensation cost related to all non-vested stock option awards not yet recognized was $4,668 and is expected to be recognized over the remaining weighted-average period of 2.8 years. | ||||||||||||
Effective September 23, 2014, the Company redenominated certain outstanding stock options totaling 539,869 shares originally granted to non-Australia-based employees with an AU$ exercise price to the equivalent US$ exercise price, the Company’s functional currency. The redenomination was computed using the quoted currency exchange rate on September 23, 2014 and did not result in the recognition of any incremental stock option expense as a result of the modification. | ||||||||||||
Restricted Stock Awards: The following table summarizes restricted stock award activity during 2014 and 2013: | ||||||||||||
2014 | 2013 | |||||||||||
RSUs | Weighted | RSUs | Weighted | |||||||||
Average | Average | |||||||||||
Grant | Grant | |||||||||||
Price | Price | |||||||||||
Nonvested, beginning balance | 84,128 | $ | 11.32 | — | $ | — | ||||||
Granted | 244,225 | 5.07 | 116,202 | 10.97 | ||||||||
Vested | (168,682 | ) | 8.11 | (32,074 | ) | 10.01 | ||||||
Forfeited | (3,136 | ) | 10.9 | — | — | |||||||
Nonvested at December 31 | 156,535 | $ | 5.06 | 84,128 | $ | 11.32 | ||||||
During 2014 and 2013, employees tendered restricted stock units totaling 70,161 and 9,779, respectively, to cover related payroll tax withholdings. | ||||||||||||
Common Stock Issuances: Fully vested common stock awards totaling 105,605 shares at a weighted average value of $11.32 per share were issued in the year ended December 31, 2013. Of these shares awarded, 49,137 shares were tendered to the Company to cover related employee payroll tax withholdings. There were no awards of fully vested common stock in 2014. | ||||||||||||
Warrants | ||||||||||||
During the year ended December 31, 2014, 2,798 warrants were exercised at a price of AU$6.40 per share for total proceeds of $16 and 15,000 warrants were exercised at a price of AU$6.40 per share resulting in the net issuance of 5,397 shares of common stock. During the year ended December 31, 2013, 2,449 warrants were exercised at a price of AU$6.40 per share for total proceeds of $15. | ||||||||||||
Warrants to purchase 505,166 and 1,630,804 shares of common stock were outstanding at December 31, 2014 and 2013, respectively. | ||||||||||||
Income_Taxes
Income Taxes | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Income Taxes | ||||||||
Income Taxes | ||||||||
Note 5—Income Taxes | ||||||||
Domestic and foreign loss before income taxes, consists of the following: | ||||||||
Year Ended | ||||||||
December 31, 2014 | December 31, 2013 | |||||||
Domestic | $ | (25,773 | ) | $ | (22,149 | ) | ||
Foreign | (63 | ) | (822 | ) | ||||
Loss before income taxes | $ | (25,836 | ) | $ | (22,971 | ) | ||
The components of income tax benefit consist of the following: | ||||||||
Year Ended | ||||||||
December 31, 2014 | December 31, 2013 | |||||||
Income tax benefit: | ||||||||
Current: | ||||||||
United States and state | $ | — | $ | 136 | ||||
Foreign, net | 249 | 1,077 | ||||||
Deferred: | ||||||||
United States and state | — | — | ||||||
Foreign | — | — | ||||||
Total income tax benefit | $ | 249 | $ | 1,213 | ||||
Actual income tax benefit differs from statutory federal income tax benefit as follows: | ||||||||
Year Ended | ||||||||
December 31, 2014 | December 31, 2013 | |||||||
Statutory federal income tax benefit | $ | 8,784 | $ | 7,810 | ||||
State tax benefit, net of federal taxes | — | 1,363 | ||||||
Foreign tax | 23 | (33 | ) | |||||
R&D tax credit | 265 | 1,213 | ||||||
Nondeductible/nontaxable items | (283 | ) | (367 | ) | ||||
Other | — | (119 | ) | |||||
Valuation allowance increase | (8,540 | ) | (8,654 | ) | ||||
Total income tax benefit | $ | 249 | $ | 1,213 | ||||
Deferred taxes consist of the following: | ||||||||
As of | ||||||||
December 31, 2014 | December 31, 2013 | |||||||
Deferred tax assets: | ||||||||
Current: | ||||||||
Accrued leave | $ | 84 | $ | 76 | ||||
Other accrued expenses | 97 | 114 | ||||||
Total current deferred tax asset | 181 | 190 | ||||||
Noncurrent: | ||||||||
Stock based compensation | 1,287 | 1,476 | ||||||
Net operating loss carryforward | 37,248 | 31,958 | ||||||
Deferred rent | 29 | 76 | ||||||
Other | 54 | 46 | ||||||
R&D credit carryforward | 531 | 531 | ||||||
Total noncurrent deferred tax assets | 39,149 | 34,087 | ||||||
Total deferred tax assets | $ | 39,330 | $ | 34,277 | ||||
Deferred tax liabilities: | ||||||||
Current: | $ | — | $ | — | ||||
Noncurrent: | ||||||||
Fixed assets | (31 | ) | (37 | ) | ||||
Total deferred tax liabilities | $ | (31 | ) | $ | (37 | ) | ||
Net deferred tax asset | 39,299 | 34,240 | ||||||
Less: valuation allowance | (39,299 | ) | (34,240 | ) | ||||
Total | $ | — | $ | — | ||||
As of December 31, 2014, the Company had net operating loss (“NOLs”) carryforwards of approximately $69.3 million for U.S. federal income tax purposes, which expire between 2024 and 2034, and NOLs in the Commonwealth of Australia of approximately AU$48.8 million which the Company can carry forward indefinitely. U.S. NOLs cannot be used to offset taxable income in foreign jurisdictions. In addition, future utilization of NOL carryforwards in the U.S. may be subject to certain limitations under Section 382 of the Internal Revenue Code. | ||||||||
The Company received a $265 and $1.1 million fully refundable research and development tax credits in 2014 and 2013, respectively, related to qualified research and development expenditures of its Australian subsidiary for its tax years ended June 30, 2013 and 2012, respectively. Additionally, in 2013, the Company received $136 research and development tax credit refund from the State of Minnesota for the tax year ended December 31, 2012. The Company has not completed its Australian tax return for its Australian subsidiaries tax year ended June 30, 2014. As the Company cannot be reasonably assured of the amount or eligibility of the refundable research and development credit resulting from its Australian research and development activities, the Company has not reflected a benefit related to the research and development credit in its income tax provision for the year ended December 31, 2014. The Minnesota research and development credit is no longer refundable for tax years beyond 2012. | ||||||||
The Company provides for a valuation allowance when it is more likely than not that it will not realize a portion of the deferred tax assets. The Company has established a valuation allowance for U.S. and foreign deferred tax assets due to the uncertainty that enough taxable income will be generated in those taxing jurisdictions to utilize the assets. Therefore, the Company has not reflected any benefit of such deferred tax assets in the accompanying financial statements. For the years ended December 31, 2014 and 2013, the valuation allowance increased by $5.1 million and $5.8 million, respectively. | ||||||||
The accounting guidance related to uncertain tax positions prescribes a recognition threshold and measurement attribute for recognition and measurement of a tax position taken or expected to be taken in a tax return. It also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. The Company had no material uncertain tax positions as of December 31, 2014 or December 31, 2013. | ||||||||
The Company recognizes interest and penalties on unrecognized tax benefits as well as interest received from favorable tax settlements within income tax expense. During the years ended December 31, 2014 and 2013, the Company recorded no accrued interest or penalties related to uncertain tax positions. | ||||||||
The fiscal tax years ended June 30, 2011 through December 31, 2014 remain open to examination by the Internal Revenue Service. For the states of California and Minnesota, all years subsequent to the fiscal tax year ended June 30, 2011 are also open to examination. Additionally, the returns of the Company’s Australian subsidiary are subject to examination by Australian tax authorities for the fiscal tax years ended June 30, 2010 through June 30, 2014. | ||||||||
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2014 | |
Commitments and Contingencies. | |
Commitments and Contingencies | Note 6—Commitments and Contingencies |
Leases | |
The Company leases office space under a non-cancelable operating lease that expires in March 2016. The lease includes several months abated rent and contains future rent escalation provisions based upon Consumer Price Indexes. Rent expense is being recorded across all periods covered by the lease. The Company leases office equipment under non-cancelable operating leases that expire at various times through May 2016. | |
Rent expense related to operating leases was approximately $179 and $196 for the years ended December 31, 2014 and 2013, respectively. Future minimum lease payments under non-cancelable operating leases as of December 31, 2014, were approximately $289, $85, $9, $0 and $0 for each of the years ended December 31, 2015, through 2019, respectively. | |
Employee Retirement Plan | |
The Company has a 401(k) profit sharing plan that provides retirement benefit to substantially all full-time U.S. employees. Eligible employees may contribute a percentage of their annual compensation, subject to IRS limitations, with the Company matching a portion of the employee’s contributions at the discretion of the Company. Matching contributions totaled $146 and $14 for the years ended December 31, 2014, and 2013, respectively. | |
Segment_and_Geographic_Informa
Segment and Geographic Information | 12 Months Ended |
Dec. 31, 2014 | |
Segment and Geographic Information | |
Segment and Geographic Information | Note 7—Segment and Geographic Information |
The Company has one reportable segment, cardiac and coronary disease products. | |
At December 31, 2014, long-lived assets were located primarily in the United States. | |
Subsequent_Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2014 | |
Subsequent Events | |
Subsequent Events | |
Note 8—Subsequent Events | |
On February 18, 2015, the Company entered into a loan and security agreement with Silicon Valley Bank for proceeds of up to $10.0 million. Under this agreement, the Company received $6.0 million at closing and has available an additional $2.0 million after the notification that the FDA had accepted its statistical interim analysis plan. The remaining $2.0 million will become available upon the Company enrolling its one hundredth patient in the COUNTER HF trial on or before September 30, 2015. | |
The proceeds from the loan will be used for general corporate and working capital purposes. The Company is entitled to make interest only payments until January 1, 2016. Commencing on January 1, 2016, and continuing on the first day of each calendar month thereafter, the Company is required to repay the advances made in twenty-four (24) consecutive equal monthly installments of principal and interest, based upon: (i) the amount of the advances made under the loan, and (ii) interest at a fixed per annum rate equal to 7.0%, | |
In connection with the loan and security agreement, the Company issued 68,996 warrants at an exercise price of $5.22 per share to Silicon Valley Bank and one of its affiliates. The warrants have a life of ten years and were fully vested at the date of grant. The Company is in the process of completing the valuation of these warrants. The value of these warrants will be reflected as a charge to expense in the Company’s first quarter statement of operations for the year ending December 31, 2015. | |
On February 25, 2015, the Company announced that it had received unconditional approval from the FDA to conduct an interim analysis of COUNTER HF, its US pivotal trial. The COUNTER HF study is a prospective, randomized, multi-center, controlled study expected to randomize 388 patients in up to 40 clinical sites. This interim analysis could reduce the overall duration of the trial. | |
On March 6, 2015, the Company announced that COUNTER HF had reached a pre-determined pausing point and temporarily suspended enrollment in accordance with the study protocol. The FDA has responded to the Company’s pause notification and has advised that it submit an IDE supplement to discuss the reasons for the temporary suspension and a plan for study resumption. The Company submitted the document to the FDA on March 16, 2015. This supplement carries up to a 30-day review period by the FDA. | |
Nature_of_Business_and_Signifi1
Nature of Business and Significant Accounting Policies (Policies) | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Nature of Business and Significant Accounting Policies | ||||
Nature of Business | Nature of Business | |||
Sunshine Heart, Inc. was founded in November 1999 and incorporated in Delaware in August 2002. The Company is headquartered in Eden Prairie, Minnesota and has a wholly owned subsidiary, Sunshine Heart Company Pty Limited, located in Clontarf, New South Wales, Australia and a wholly owned subsidiary, Sunshine Heart Ireland Limited, located in Dublin, Ireland. The Company is a medical device company developing innovative technologies for cardiac and coronary disease. The Company’s primary product, the C-Pulse System, is an implantable, non-blood contacting, heart assist therapy for the treatment of moderate to severe heart failure which can be implanted using a minimally invasive procedure. The C-Pulse System is designed to relieve the symptoms of heart failure through the use of counter-pulsation technology by enabling an increase in cardiac output, an increase in coronary blood flow, and a reduction in the heart’s pumping load. The Company has received approval from the US Food and Drug Administration (“FDA”) to conduct a U.S. feasibility clinical study with the C-Pulse System. Commencing February 16, 2012, the Company’s shares of common stock began trading on NASDAQ under the symbol “SSH.” The Company’s shares of common stock previously traded in the form of CDIs on the ASX under the symbol “SHC” from September 2004 until the Company’s delisting from the ASX, which occurred at the close of trading on May 6, 2013. | ||||
Going Concern | Going Concern | |||
The Company’s financial statements have been prepared and presented on a basis assuming it continues as a going concern. | ||||
During the years ended December 31, 2014 and 2013, the Company incurred losses from operations and net cash outflows from operating activities as disclosed in the consolidated statements of operations and comprehensive loss and cash flows, respectively. At December 31, 2014, the Company had an accumulated deficit of $126.6 million and expects to incur losses for the foreseeable future. To date, the Company has been funded by private and public equity financings. Although the Company believes that it will be able to successfully fund its operations, there can be no assurance the Company will be able to do so or that the Company will ever operate profitably. | ||||
The Company’s ability to continue as a going concern is dependent on the Company’s ability to raise additional capital based on the achievement of existing milestones as and when required. Should future capital raising be unsuccessful, the Company may not be able to continue as a going concern. Furthermore, the ability of the Company to continue as a going concern is subject to the ability of the Company to develop and successfully commercialize the product being developed. If the Company is unable to obtain such funding of an amount and timing necessary to meet its future operational plans, or to successfully commercialize its intellectual property, the Company may be unable to continue as a going concern. No adjustments have been made relating to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company not continue as a going concern. | ||||
Basis of Presentation | Basis of Presentation | |||
The accompanying consolidated financial statements include the accounts of Sunshine Heart, Inc. and its wholly owned subsidiaries, Sunshine Heart Company Pty Limited and Sunshine Heart Ireland Limited. All inter-company accounts and transactions between consolidated entities have been eliminated. | ||||
Use of Estimates | Use of Estimates | |||
The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts and disclosures in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. | ||||
Fair Value of Financial Instruments | Fair Value of Financial Instruments | |||
The Company’s financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities. The Company believes that the carrying amounts of the financial instruments approximate their respective current fair values due to their relatively short maturities. | ||||
Pursuant to the requirements of Financial Accounting Standards Board (the “FASB”) Accounting Standards Codification (the “ASC”) Topic 820 “Fair Value Measurement,” the Company’s financial assets and liabilities measured at fair value on a recurring basis are classified and disclosed in one of the following three categories: | ||||
· | Level 1 - Financial instruments with unadjusted quoted prices listed on active market exchanges. | |||
· | Level 2 - Financial instruments lacking unadjusted, quoted prices from active market exchanges, including over the counter traded financial instruments. The prices for the financial instruments are determined using prices for recently traded financial instruments with similar underlying terms as well as directly or indirectly observable inputs, such as interest rates and yield curves that are observable at commonly quoted intervals. | |||
· | Level 3 - Financial instruments that are not actively traded on a market exchange. This category includes situations where there is little, if any, market activity for the financial instrument. The prices are determined using significant unobservable inputs or valuation techniques. | |||
All cash equivalents are considered Level 1 measurements for all periods presented. The Company does not have any financial instruments classified as Level 2 or Level 3 and there were no movements between these categories during the years ended December 31, 2014 and 2013. | ||||
Cash and Cash Equivalents | Cash and Cash Equivalents | |||
Cash and cash equivalents consist of cash and term deposits with original maturities of three months or less. The carrying value of these instruments approximate fair value. The balances, at times, may exceed federally insured limits. The Company has not experienced any losses on its cash and cash equivalents. | ||||
Accounts Receivable | Accounts Receivable | |||
Accounts receivable are unsecured, are recorded at net realizable value, and do not bear interest. The Company makes judgments as to its ability to collect outstanding receivables based upon significant patterns of uncollectiblity, historical experience, and managements’ evaluation of specific accounts and will provide an allowance for credit losses when collection becomes doubtful. The Company performs credit evaluations of its customers’ financial condition on an as-needed basis. Payment is generally due 30 days from the invoice date and accounts past 30 days are individually analyzed for collectability. When all collection efforts have been exhausted, the account is written off against the related allowance. No allowance for doubtful accounts was considered necessary as of December 31, 2014 and 2013. | ||||
Other Current Assets | Other Current Assets | |||
Other current assets represent prepayments and deposits made by the Company. | ||||
Property, Plant and Equipment | Property, Plant and Equipment | |||
Property and equipment is stated at cost less accumulated depreciation. Depreciation is computed based upon the estimated useful lives of the respective assets. Leasehold improvements are amortized using the straight-line method over the shorter of the lease term or the estimated useful life of the assets. Repairs and maintenance costs are expensed as incurred. The cost and accumulated depreciation of property, plant and equipment retired, or otherwise disposed of are removed from the related accounts, and any residual values are charged to expense. Depreciation expense has been calculated using the following estimated useful lives: | ||||
Office furniture and equipment | 5-15 years | |||
Computer software and equipment | 3-4 years | |||
Laboratory and research equipment | 3-15 years | |||
Production equipment | 3-7 years | |||
Depreciation expense was $277 and $185 for the years ended December 31, 2014 and 2013, respectively. | ||||
Property and equipment are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset or asset group may not be recoverable. If the impairment tests indicate that the carrying value of the asset, or asset group is greater than the expected undiscounted cash flows to be generated by such asset or asset group further analysis is performed to determine the fair value of the asset or asset group. To the extent the fair value of the asset or asset group is less than its carrying value, an impairment loss is recognized equal to the amount the fair value of the asset or asset group exceeds its carrying amount. The Company generally measures fair value by considering sale prices for similar assets or asset groups, or by discounting estimated future cash flows from such assets or asset groups using an appropriate discount rate. Assets to be disposed of are carried at the lower of their carrying value or fair value less costs to sell. Considerable management judgment is necessary to estimate the fair value of assets or asset groups, and accordingly, actual results could vary significantly from such estimates. There have been no impairment losses recognized for the years ended December 31, 2014 or 2013. | ||||
Revenue Recognition | Revenue Recognition | |||
The Company recognizes revenue when (i) persuasive evidence of a customer arrangement exists; (ii) the price is fixed or determinable and free of contingencies or uncertainties; (iii) collectability is reasonably assured; and (iv) product delivery has occurred, which is when product title transfers to the customer, or services have been rendered. Sales are not conditional based on customer acceptance provisions or installation obligations. The C-Pulse System is not approved for commercial sale. However, the FDA has assigned the C-Pulse System to a Category B designation, making it eligible for reimbursement at certain U.S. sites during the Company’s clinical studies. Consequently, the Company is able to invoice hospitals and clinics that are eligible for reimbursement by Medicare, Medicaid or private insurance companies. The Company’s revenue consists solely of sales of the C-Pulse System to hospitals and clinics who participate in the Company’s clinical studies per the terms of the clinical study contracts. For clinical study implant revenue, the product title generally transfers on the date the product is implanted. Product costs incurred for the Company’s clinical studies are deemed to be development costs and are expensed to research and development as incurred. Upon commercialization, product costs will be capitalized in inventory and recorded to cost of sales as the inventory is sold. The Company does not charge hospitals and clinics for shipping. The Company expenses shipping costs at the time of shipment. | ||||
Foreign Currency Translation | Foreign Currency Translation | |||
Sales and expenses denominated in foreign currencies are translated at average exchange rates in effect throughout the year. Assets and liabilities of foreign operations are translated at period-end exchange rates with the impacts of foreign currency translation recognized to cumulative translation adjustment, a component of accumulated other comprehensive income. Foreign currency transactions gains and losses are included in other expense, net in the consolidated statements of operations and other comprehensive loss. | ||||
Stock-Based Compensation | Stock-Based Compensation | |||
The Company recognizes all share-based payments to employees and directors, including grants of stock options, restricted stock units (RSUs) and common stock awards in the income statement as an operating expense, based on their fair value. The Company’s stock awards use a graded vesting schedule. The Company recognizes the option expense over the requisite service period, which is generally the vesting period. | ||||
The Company computes the estimated fair values of stock options and warrants using the Black-Scholes option pricing model. The closing market price of the Company’s common stock at the date of grant is used to calculate the fair value of restricted stock units and common stock awards. No tax benefit has been recorded in connection with these awards as the Company has provided a full valuation allowance on its deferred tax assets. | ||||
Stock-based compensation expense is based on awards ultimately expected to vest and is reduced for estimated forfeitures. Forfeitures are estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. | ||||
Equity instruments issued to non-employees include RSUs, warrants or options to purchase shares of the Company’s common stock. These RSUs, warrants or options are either fully-vested and exercisable at the date of grant or vest over a certain period during which services are provided. The Company expenses the fair market value of fully vested awards at the time of grant, and of unvested awards over the period in which the related services are received. Unvested awards are remeasured to fair value until they vest. | ||||
See Note 4 for further information regarding the assumptions used to calculate the fair value of share-based compensation. | ||||
Income Taxes | Income Taxes | |||
Deferred income taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carryforwards. Deferred tax liabilities are recognized for taxable temporary differences, which are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. | ||||
Net Loss per Share | Net Loss per Share | |||
Basic net loss attributable to common stockholders, on a per share basis, is computed by dividing income available to common stockholders (the numerator) by the weighted-average number of common shares outstanding (the denominator) during the period. Shares issued during the period and shares reacquired during the period are weighted for the portion of the period that they were outstanding. The computation of diluted earnings per share (“EPS”) is similar to the computation of basic EPS except that the denominator is increased to include the number of additional common shares that would have been outstanding if the dilutive potential common shares had been issued and computed in accordance with the treasury stock method. In addition, in computing the dilutive effect of convertible securities, the numerator is adjusted to add back the after-tax amount of interest recognized in the period associated with any convertible debt. Shares reserved for outstanding stock warrants and options and restricted stock units totaling 2,832,194 and 3,623,806 for the years ended December 31, 2014 and 2013, respectively, were excluded from the computation of loss per share as their effect was antidilutive due to the Company’s net loss in each of those years. | ||||
Research and Development | Research and Development | |||
Research and development expenses consist primarily of development personnel and non-employee contractor costs related to the development of new products and services, enhancement of existing products and services, quality assurance and testing. The Company incurred research and development expenses of $16,874 and $13,504 for the years ended December 31, 2014 and 2013, respectively. | ||||
Recent Accounting Pronouncements | Recent Accounting Pronouncements | |||
In May 2014, the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606) (ASU 2014-09). This standard is a comprehensive new revenue recognition model that creates a single source of revenue guidance for all companies in all industries. The model is more principle-based than current guidance, and is primarily based on recognizing revenue in an amount that reflects the consideration to which the entity expects to be entitled in exchange for transferring goods or services to a customer. The guidance of ASU 2014-09 will be effective for the Company’s interim and annual reporting periods beginning January 1, 2017. The standard allows the Company to transition to the new model using either a full or modified retrospective approach, and early adoption is not permitted. The Company is currently evaluating the impact that this standard will have on its business practices, financial condition, results of operations and disclosures. | ||||
In August 2014, the FASB issued ASU 2014-15, Presentation of Financial Statements - Going Concern (Subtopic 205-40); Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern, which explicitly requires management of a company to evaluate whether there is substantial doubt about a company’s ability to continue as a going concern and to provide related footnote disclosure in certain circumstances. This guidance is effective for the Company’s interim and annual reporting periods beginning January 1, 2017, with early adoption permitted. The Company is evaluating the impact that the adoption of this standard will have, if any, on its financial statements and disclosures. | ||||
The Company evaluates events through the date the financial statements are filed for events requiring adjustment to or disclosure in the financial statements. | ||||
Nature_of_Business_and_Signifi2
Nature of Business and Significant Accounting Policies (Tables) | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Nature of Business and Significant Accounting Policies | ||||
Schedule of estimated useful lives | Office furniture and equipment | 5-15 years | ||
Computer software and equipment | 3-4 years | |||
Laboratory and research equipment | 3-15 years | |||
Production equipment | 3-7 years | |||
Balance_Sheet_Information_Tabl
Balance Sheet Information (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Balance Sheet Information | ||||||||
Schedule of property, plant and equipment | December 31, 2014 | December 31, 2013 | ||||||
Office Furniture & Fixtures | $ | 229 | $ | 111 | ||||
Leasehold Improvements | 145 | 145 | ||||||
Software | 65 | 61 | ||||||
Production Equipment | 786 | 574 | ||||||
Computer Equipment | 221 | 204 | ||||||
Total | 1,446 | 1,095 | ||||||
Accumulated Depreciation | (785 | ) | (508 | ) | ||||
$ | 661 | $ | 587 | |||||
StockBased_Compensation_Tables
Stock-Based Compensation (Tables) | 12 Months Ended | |||||||||||
Dec. 31, 2014 | ||||||||||||
Stock-Based Compensation | ||||||||||||
Summary of stock-based compensation expense | ||||||||||||
December 31, 2014 | December 31, 2013 | |||||||||||
Selling, general and administrative | $ | 2,241 | $ | 2,722 | ||||||||
Research and development | 844 | 882 | ||||||||||
Total | $ | 3,085 | $ | 3,604 | ||||||||
Summary of the Plan and non-Plan stock option activity | ||||||||||||
2014 | 2013 | |||||||||||
Options | Weighted | Options | Weighted | |||||||||
Outstanding | Average | Outstanding | Average | |||||||||
Exercise | Exercise | |||||||||||
Price | Price | |||||||||||
Beginning Balance | 1,886,579 | $ | 8.8 | 1,113,244 | $ | 9.47 | ||||||
Granted | 776,348 | 5.37 | 905,900 | 8.17 | ||||||||
Exercised | (16,580 | ) | 5.88 | — | — | |||||||
Forfeited/expired | (475,854 | ) | 10.98 | (132,565 | ) | 10.06 | ||||||
Outstanding at December 31 | 2,170,493 | $ | 6.51 | 1,886,579 | $ | 8.8 | ||||||
Exercisable at December 31 | 995,351 | $ | 7.18 | 801,480 | $ | 8.95 | ||||||
Schedule of weighted-average assumptions used in calculating the fair value of options granted | Year ended December 31 | |||||||||||
2014 | 2013 | |||||||||||
Expected dividend yield | 0% | 0% | ||||||||||
Risk-free interest rate | 2.12% | 1.31% | ||||||||||
Expected volatility | 91% | 96% | ||||||||||
Expected life (in years) | 6.25 | 5.5 | ||||||||||
Summary of restricted stock award activity | ||||||||||||
2014 | 2013 | |||||||||||
RSUs | Weighted | RSUs | Weighted | |||||||||
Average | Average | |||||||||||
Grant | Grant | |||||||||||
Price | Price | |||||||||||
Nonvested, beginning balance | 84,128 | $ | 11.32 | — | $ | — | ||||||
Granted | 244,225 | 5.07 | 116,202 | 10.97 | ||||||||
Vested | (168,682 | ) | 8.11 | (32,074 | ) | 10.01 | ||||||
Forfeited | (3,136 | ) | 10.9 | — | — | |||||||
Nonvested at December 31 | 156,535 | $ | 5.06 | 84,128 | $ | 11.32 | ||||||
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | |||||||
Dec. 31, 2014 | ||||||||
Income Taxes | ||||||||
Schedule of domestic and foreign loss before income tax | ||||||||
Year Ended | ||||||||
December 31, 2014 | December 31, 2013 | |||||||
Domestic | $ | (25,773 | ) | $ | (22,149 | ) | ||
Foreign | (63 | ) | (822 | ) | ||||
Loss before income taxes | $ | (25,836 | ) | $ | (22,971 | ) | ||
Schedule of components of income tax expense | Year Ended | |||||||
December 31, 2014 | December 31, 2013 | |||||||
Income tax benefit: | ||||||||
Current: | ||||||||
United States and state | $ | — | $ | 136 | ||||
Foreign, net | 249 | 1,077 | ||||||
Deferred: | ||||||||
United States and state | — | — | ||||||
Foreign | — | — | ||||||
Total income tax benefit | $ | 249 | $ | 1,213 | ||||
Summary showing actual income tax expense differing from statutory federal income tax benefit | Year Ended | |||||||
December 31, 2014 | December 31, 2013 | |||||||
Statutory federal income tax benefit | $ | 8,784 | $ | 7,810 | ||||
State tax benefit, net of federal taxes | — | 1,363 | ||||||
Foreign tax | 23 | (33 | ) | |||||
R&D tax credit | 265 | 1,213 | ||||||
Nondeductible/nontaxable items | (283 | ) | (367 | ) | ||||
Other | — | (119 | ) | |||||
Valuation allowance increase | (8,540 | ) | (8,654 | ) | ||||
Total income tax benefit | $ | 249 | $ | 1,213 | ||||
Schedule of components of deferred taxes | As of | |||||||
December 31, 2014 | December 31, 2013 | |||||||
Deferred tax assets: | ||||||||
Current: | ||||||||
Accrued leave | $ | 84 | $ | 76 | ||||
Other accrued expenses | 97 | 114 | ||||||
Total current deferred tax asset | 181 | 190 | ||||||
Noncurrent: | ||||||||
Stock based compensation | 1,287 | 1,476 | ||||||
Net operating loss carryforward | 37,248 | 31,958 | ||||||
Deferred rent | 29 | 76 | ||||||
Other | 54 | 46 | ||||||
R&D credit carryforward | 531 | 531 | ||||||
Total noncurrent deferred tax assets | 39,149 | 34,087 | ||||||
Total deferred tax assets | $ | 39,330 | $ | 34,277 | ||||
Deferred tax liabilities: | ||||||||
Current: | $ | — | $ | — | ||||
Noncurrent: | ||||||||
Fixed assets | (31 | ) | (37 | ) | ||||
Total deferred tax liabilities | $ | (31 | ) | $ | (37 | ) | ||
Net deferred tax asset | 39,299 | 34,240 | ||||||
Less: valuation allowance | (39,299 | ) | (34,240 | ) | ||||
Total | $ | — | $ | — | ||||
Nature_of_Business_and_Signifi3
Nature of Business and Significant Accounting Policies (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Going Concern | ||
Accumulated deficit | $126,599 | $101,012 |
Accounts Receivable | ||
Period of payment due from the invoice date | 30 days | |
Allowance for doubtful accounts | 0 | 0 |
Property, plant and equipment | ||
Depreciation expense | 277 | 185 |
Impairment losses for long-lived assets | 0 | 0 |
Share based compensation disclosures | ||
Share based compensation tax benefit | $0 | |
Office furniture and equipment | Minimum | ||
Property, plant and equipment | ||
Estimated useful lives | 5 years | |
Office furniture and equipment | Maximum | ||
Property, plant and equipment | ||
Estimated useful lives | 15 years | |
Computer software and equipment | Minimum | ||
Property, plant and equipment | ||
Estimated useful lives | 3 years | |
Computer software and equipment | Maximum | ||
Property, plant and equipment | ||
Estimated useful lives | 4 years | |
Laboratory and research equipment | Minimum | ||
Property, plant and equipment | ||
Estimated useful lives | 3 years | |
Laboratory and research equipment | Maximum | ||
Property, plant and equipment | ||
Estimated useful lives | 15 years | |
Production equipment | Minimum | ||
Property, plant and equipment | ||
Estimated useful lives | 3 years | |
Production equipment | Maximum | ||
Property, plant and equipment | ||
Estimated useful lives | 7 years |
Nature_of_Business_and_Signifi4
Nature of Business and Significant Accounting Policies (Details 2) (USD $) | 12 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Antidilutive securities | ||
Shares reserved for outstanding stock warrants and options and restricted stock units excluded from the computation of loss per share due to their antidilutive effect | 2,832,194 | 3,623,806 |
Research and Development | ||
Research and Development Expense | $16,874 | $13,504 |
Balance_Sheet_Information_Deta
Balance Sheet Information (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Property, Plant and Equipment | ||
Total | $1,446 | $1,095 |
Accumulated Depreciation | -785 | -508 |
Property, plant and equipment, net | 661 | 587 |
Office furniture and equipment | ||
Property, Plant and Equipment | ||
Total | 229 | 111 |
Leasehold Improvements | ||
Property, Plant and Equipment | ||
Total | 145 | 145 |
Software | ||
Property, Plant and Equipment | ||
Total | 65 | 61 |
Production equipment | ||
Property, Plant and Equipment | ||
Total | 786 | 574 |
Computer software and equipment | ||
Property, Plant and Equipment | ||
Total | $221 | $204 |
Shareholders_Equity_Details
Shareholder's Equity (Details) (USD $) | 0 Months Ended | 12 Months Ended | 0 Months Ended | 1 Months Ended | 2 Months Ended | 0 Months Ended | |||||
Sep. 24, 2013 | Apr. 16, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Jan. 15, 2013 | Dec. 31, 2014 | Mar. 21, 2014 | Dec. 31, 2014 | Dec. 31, 2014 | Feb. 27, 2015 | Jun. 14, 2013 | |
Sales of common stocks | |||||||||||
Common stock sold (in shares) | 4,381,500 | 2,875,000 | |||||||||
Common stock offering price (in dollars per share) | $10.50 | $5.25 | |||||||||
Shares issued upon exercise of over-allotment options by underwriters | 571,500 | 375,000 | |||||||||
Proceeds, net of transaction costs | $42,674,000 | $14,036,000 | $89,000 | $57,566,000 | |||||||
Aspire Capital | |||||||||||
Sales of common stocks | |||||||||||
Term for purchase of shares by Aspire Capital | 2 years | ||||||||||
Number of shares of common stock registered on Form S-1 for resale by Aspire | 3,000,000 | ||||||||||
Number of shares of common stock issued to Aspire Capital as commitment fee | 80,257 | ||||||||||
Common stock sold (in shares) | 146,886 | ||||||||||
Common stock sold including commitment shares (in shares) | 227,143 | ||||||||||
Aspire Capital | Subsequent event | |||||||||||
Sales of common stocks | |||||||||||
Common stock sold including commitment shares (in shares) | 0 | ||||||||||
Cowen | |||||||||||
Sales of common stocks | |||||||||||
Common stock sold (in shares) | 23,120 | ||||||||||
Proceeds, net of transaction costs | 73,000 | ||||||||||
Aggregate offering price of shares of common stock | 40,000,000 | ||||||||||
Percentage of commission the company pays from gross proceeds of any shares pursuant to the sales agreement | 3.00% | ||||||||||
Stock issuance cost | 32,000 | ||||||||||
Value of common stock available for future sale | 39,900,000 | ||||||||||
Cowen | Subsequent event | |||||||||||
Sales of common stocks | |||||||||||
Common stock sold (in shares) | 1,214,395 | ||||||||||
Proceeds, net of transaction costs | 6,900,000 | ||||||||||
Stock issuance cost | 200,000 | ||||||||||
Maximum | Aspire Capital | |||||||||||
Sales of common stocks | |||||||||||
Value of common stock purchase commitment | 25,000,000 | ||||||||||
Number of shares authorized for sale and issuance (in shares) | 1,856,616 | ||||||||||
Shares authorized for sale and issuance (as a percent) | 19.99% | ||||||||||
Series A junior participating preferred stock | |||||||||||
Sales of common stocks | |||||||||||
Par value of preferred stock that the holder of rights is entitled to purchase (in dollars per share) | $0.00 | $0.00 | $0.00 | $0.00 | 0.0001 | ||||||
Authorized shares | 30,000 | 30,000 | 30,000 | 30,000 | 30,000 | ||||||
Rights Plan | |||||||||||
Sales of common stocks | |||||||||||
Term of plan | 3 years | ||||||||||
Minimum percentage of stock that may be required to be acquired by a person or group to cause substantial dilution | 15.00% | ||||||||||
Rights Plan | Series A junior participating preferred stock | |||||||||||
Sales of common stocks | |||||||||||
Number of shares of preferred stock that the holder is entitled against each right | 0.001 | ||||||||||
Par value of preferred stock that the holder of rights is entitled to purchase (in dollars per share) | 0.0001 | ||||||||||
Purchase price (in dollars per share) | 35 | ||||||||||
Authorized shares | 30,000 | ||||||||||
Dividend right declared per share of common stock (in shares) | 1 | ||||||||||
Number of common stock for which their voting right is equivalent to voting right of 1/1,000th of a share of Series A Junior Participating Preferred Stock | 1 |
StockBased_Compensation_Detail
Stock-Based Compensation (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Stock-based compensation | ||
Compensation expense | $3,085 | $3,604 |
Selling, general and administrative expense. | ||
Stock-based compensation | ||
Compensation expense | 2,241 | 2,722 |
Research and development expense. | ||
Stock-based compensation | ||
Compensation expense | $844 | $882 |
StockBased_Compensation_Detail1
Stock-Based Compensation (Details 2) (USD $) | 12 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Sep. 23, 2014 |
Restricted stock award activity weighted average grant price | |||
Number of shares of stock option outstanding redenominated to US$ exercise price | 539,869 | ||
Minimum | |||
Stock-based compensation | |||
Vesting period | 1 year | ||
Maximum | |||
Stock-based compensation | |||
Vesting period | 4 years | ||
Stock Option | |||
Options Outstanding | |||
Outstanding at the beginning of the year (in shares) | 1,886,579 | 1,113,244 | |
Granted (in shares) | 776,348 | 905,900 | |
Exercised (in shares) | -16,580 | 0 | |
Forfeited/expired (in shares) | -475,854 | -132,565 | |
Outstanding at the end of the year (in shares) | 2,170,493 | 1,886,579 | |
Exercisable at the end of the year (in shares) | 995,351 | 801,480 | |
Weighted Average Exercise Price | |||
Outstanding at the beginning of the year (in dollars per share) | 8.8 | $9.47 | |
Granted (in dollars per share) | 5.37 | $8.17 | |
Exercised (in dollars per share) | 5.88 | ||
Forfeited/expired (in dollars per share) | 10.98 | $10.06 | |
Outstanding at the end of the year (in dollars per share) | 6.51 | $8.80 | |
Exercisable at the end of the year (in dollars per share) | 7.18 | $8.95 | |
Remaining Average Contractual Term | |||
Outstanding at the end of the year | 8 years 26 days | ||
Exercisable at the end of the year | 7 years 18 days | ||
Aggregate Intrinsic Value | |||
Total intrinsic value | 56 | ||
Additional disclosures | |||
Weighted-average fair value of options granted (in dollars per share) | 4.05 | $5.54 | |
Weighted-average assumptions used in calculating the fair value of options granted | |||
Expected dividend yield (as a percent) | 0.00% | 0.00% | |
Risk-free interest rate (as a percent) | 2.12% | 1.31% | |
Expected volatility (as a percent) | 91.00% | 96.00% | |
Expected life | 6 years 3 months | 5 years 6 months | |
Restricted stock award activity weighted average grant price | |||
Total unrecognized compensation costs related to non-vested stock option awards | 4,668 | ||
Unrecognized compensation costs related to non-vested stock option awards, recognition period | 2 years 9 months 18 days | ||
Restricted stock units | |||
Restricted stock award activity | |||
Nonvested beginning balance | 84,128 | ||
Granted (in shares) | 244,225 | 116,202 | |
Vested (in shares) | -168,682 | -32,074 | |
Forfeited (in shares) | -3,136 | ||
Nonvested ending balance | 156,535 | 84,128 | |
Restricted stock award activity weighted average grant price | |||
Nonvested weighted average grant price beginning balance | 11.32 | ||
Granted (in dollars per share) | 5.07 | $10.97 | |
Vested (in dollar per share) | 8.11 | $10.01 | |
Forfeited (in dollars per share) | 10.9 | ||
Nonvested weighted average grant price ending balance | 5.06 | $11.32 | |
Award tendered (in shares) | 70,161 | 9,779 | |
Common stock awards | |||
Restricted stock award activity | |||
Vested (in shares) | 0 | -105,605 | |
Restricted stock award activity weighted average grant price | |||
Granted (in dollars per share) | $11.32 | ||
Award tendered (in shares) | 49,137 |
StockBased_Compensation_Detail2
Stock-Based Compensation (Details 3) | 12 Months Ended | |||||
In Thousands, except Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 |
Exercise price of A$6.40 | Exercise price of A$6.40 | Exercise price of A$6.40 | Exercise price of A$6.40 | Warrants | Warrants | |
USD ($) | AUD | USD ($) | AUD | |||
Warrants | ||||||
Class of Warrant or Right Number of Securities Called by Exercised Warrants or Rights | 2,798 | 2,798 | 2,449 | |||
Price of common stock per share in exercising warrants (in dollars per share) | 6.4 | 6.4 | ||||
Total proceeds on exercise of warrants | $16 | $15 | ||||
Number of shares of common stock purchased by exercising warrants in cashless exercise | 15,000 | 15,000 | ||||
Price of common stock per share in exercising warrants in cashless exercise (in dollars per share) | 6.4 | |||||
Number of shares of common stock surrendered to fund cashless exercise | 5,397 | 5,397 | ||||
Warrants outstanding (in shares) | 505,166 | 1,630,804 |
Income_Taxes_Details
Income Taxes (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Income Taxes | ||
Domestic | ($25,773) | ($22,149) |
Foreign | -63 | -822 |
Loss before income taxes | -25,836 | -22,971 |
Current: | ||
United States and state | 136 | |
Foreign, net | 249 | 1,077 |
Total income tax benefit | 249 | 1,213 |
Income tax reconciliation | ||
Statutory federal income tax benefit | 8,784 | 7,810 |
State tax benefit, net of federal taxes | 1,363 | |
Foreign tax | 23 | -33 |
R&D tax credit | 265 | 1,213 |
Non deductible/nontaxable items | -283 | -367 |
Other | -119 | |
Valuation allowance increase | -8,540 | -8,654 |
Total income tax benefit | 249 | 1,213 |
Current: | ||
Accrued leave | 84 | 76 |
Other accrued expenses | 97 | 114 |
Total current deferred tax asset | 181 | 190 |
Noncurrent: | ||
Stock based compensation | 1,287 | 1,476 |
Net operating loss carryforward | 37,248 | 31,958 |
Deferred rent | 29 | 76 |
Other | 54 | 46 |
R&D credits carryforward | 531 | 531 |
Total noncurrent deferred tax assets | 39,149 | 34,087 |
Total deferred tax assets | 39,330 | 34,277 |
Noncurrent: | ||
Fixed assets | -31 | -37 |
Total deferred tax liabilities | -31 | -37 |
Net deferred tax asset | 39,299 | 34,240 |
Less: valuation allowance | ($39,299) | ($34,240) |
Income_Taxes_Details_2
Income Taxes (Details 2) | Dec. 31, 2014 | Dec. 31, 2014 |
In Millions, unless otherwise specified | United States | Australian |
USD ($) | AUD | |
Operating loss carryforwards | ||
Net operating loss (NOL) carryforwards | $69.30 | 48.8 |
Income_Taxes_Details_3
Income Taxes (Details 3) (USD $) | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Income Taxes | ||
Uncertain tax positions | $0 | $0 |
Interest and penalties related to uncertain tax positions accrued during the period | 0 | 0 |
Tax credit carryforward | ||
Benefit related to tax credit | 249,000 | 1,213,000 |
Increase in valuation allowance | 5,100,000 | 5,800,000 |
Research and development tax credit | Australian subsidiary | Australian | ||
Tax credit carryforward | ||
Research and development credit received | 265,000 | 1,100,000 |
Research and development tax credit | Australian subsidiary | State of Minnesota | ||
Tax credit carryforward | ||
Research and development credit received | $136,000 |
Commitments_and_Contingencies_
Commitments and Contingencies (Details) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Commitments and Contingencies. | ||
Rent expense related to operating leases | $179 | $196 |
Future minimum lease payments | ||
2015 | 289 | |
2016 | 85 | |
2017 | 9 | |
2018 | 0 | |
2019 | 0 | |
Employer's matching contribution | $146 | $14 |
Segment_and_Geographic_Informa1
Segment and Geographic Information (Details) | 12 Months Ended |
Dec. 31, 2014 | |
item | |
Segment and Geographic Information | |
Number of reportable segments | 1 |
Subsequent_Events_Details
Subsequent Events (Details) (Subsequent event, USD $) | 0 Months Ended | ||
In Millions, except Share data, unless otherwise specified | Feb. 25, 2015 | Feb. 18, 2015 | Mar. 06, 2015 |
item | item | ||
Subsequent Event | |||
Number of patients to be randomized | 388 | ||
Number of clinical sites | 40 | ||
Loan and Security Agreement with Silicon Valley Bank | |||
Subsequent Event | |||
Fixed interest rate | 7.00% | ||
Proceeds received at closing | $6 | ||
Proceeds to be received upon the company's announcement that the FDA had accepted its statistical interim analysis plan | 2 | ||
Proceeds to be received upon the company enrolling its 100th patient in the COUNTER HF study | 2 | ||
Number of consecutive equal monthly installments of principal and interest repayment | 24 | ||
Warrants issued | 68,996 | ||
Exercise price of warrants (in dollars per share) | $5.22 | ||
Term of warrants | 10 years | ||
Maximum | |||
Subsequent Event | |||
Period for supplement review by FDA | 30 days | ||
Maximum | Loan and Security Agreement with Silicon Valley Bank | |||
Subsequent Event | |||
Proceeds from loan | $10 |