Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2023 | Nov. 02, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2023 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 001-40902 | |
Entity Registrant Name | Paragon 28, Inc. | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q3 | |
Entity Central Index Key | 0001531978 | |
Current Fiscal Year End Date | --12-31 | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 27-3170186 | |
Entity Address, Address Line One | 14445 Grasslands Drive | |
Entity Address, City or Town | Englewood | |
Entity Address, State or Province | CO | |
Entity Address, Postal Zip Code | 80112 | |
City Area Code | 720 | |
Local Phone Number | 912-1332 | |
Title of 12(b) Security | Common stock, $0.01 par value per share | |
Trading Symbol | FNA | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 82,701,207 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash | $ 34,949 | $ 38,468 |
Trade receivables | 33,615 | 37,687 |
Inventories, net | 94,380 | 60,948 |
Income taxes receivable | 1,022 | 615 |
Other current assets | 4,826 | 4,658 |
Total current assets | 168,792 | 142,376 |
Property and equipment, net | 73,530 | 61,938 |
Intangible assets, net | 21,802 | 22,387 |
Goodwill | 25,465 | 25,465 |
Deferred income taxes | 132 | 148 |
Other assets | 3,634 | 1,795 |
Total assets | 293,355 | 254,109 |
Current liabilities: | ||
Accounts payable | 27,395 | 14,939 |
Accrued expenses | 24,966 | 26,807 |
Accrued legal settlement | 22,000 | |
Other current liabilities | 1,893 | 3,844 |
Current maturities of long-term debt | 640 | 728 |
Income taxes payable | 184 | |
Total current liabilities | 54,894 | 68,502 |
Long-term liabilities: | ||
Long-term debt net, less current maturities | 42,288 | 42,182 |
Other long-term liabilities | 1,467 | 1,628 |
Deferred income taxes | 327 | 342 |
Income taxes payable | 635 | 527 |
Total liabilities | 99,611 | 113,181 |
Commitments and contingencies (Note 11) | ||
Stockholders' equity: | ||
Common stock, $0.01 par value, 300,000,000 shares authorized; 83,469,426 and 78,684,107 shares issued, and 82,555,907 and 77,770,588 shares outstanding as of September 30, 2023 and December 31, 2022, respectively | 824 | 776 |
Additional paid in capital | 296,018 | 213,956 |
Accumulated deficit | (96,071) | (67,789) |
Accumulated other comprehensive loss | (1,045) | (33) |
Treasury stock, at cost; 913,519 shares as of September 30, 2023 and December 31, 2022 | (5,982) | (5,982) |
Total stockholders' equity | 193,744 | 140,928 |
Total liabilities & stockholders' equity | $ 293,355 | $ 254,109 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares | Sep. 30, 2023 | Dec. 31, 2022 |
Common stock par value | $ 0.01 | $ 0.01 |
Common stock share authorized | 300,000,000 | 300,000,000 |
Common stock share issued | 83,469,426 | 78,684,107 |
Common stock shares, outstanding | 82,555,907 | 77,770,588 |
Treasury stock share issued | 913,519 | 913,519 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Net revenue | $ 52,783 | $ 46,006 | $ 155,828 | $ 129,875 |
Cost of goods sold | 10,394 | 8,491 | 28,158 | 22,920 |
Gross profit | 42,389 | 37,515 | 127,670 | 106,955 |
Operating expenses | ||||
Research and development costs | 7,244 | 6,337 | 21,976 | 18,100 |
Selling, general and administrative | 44,126 | 39,667 | 131,773 | 114,857 |
Total operating expenses | 51,370 | 46,004 | 153,749 | 132,957 |
Operating loss | (8,981) | (8,489) | (26,079) | (26,002) |
Other income (expense): | ||||
Other income, net | 1,660 | 59 | 1,014 | 610 |
Interest expense, net | (1,119) | (1,093) | (3,127) | (2,865) |
Total other income (expense) | 541 | (1,034) | (2,113) | (2,255) |
Loss before income taxes | (8,440) | (9,523) | (28,192) | (28,257) |
Income tax (benefit) expense | (108) | 201 | 90 | 306 |
Net loss | (8,332) | (9,724) | (28,282) | (28,563) |
Foreign currency translation adjustment | (630) | (588) | (1,012) | (1,505) |
Comprehensive loss | $ (8,962) | $ (10,312) | $ (29,294) | $ (30,068) |
Weighted average number of shares of common stock outstanding: | ||||
Basic | 82,548,892 | 76,850,949 | 81,878,814 | 76,595,118 |
Diluted | 82,548,892 | 76,850,949 | 81,878,814 | 76,595,118 |
Net loss per share attributable to common stockholders: | ||||
Basic | $ (0.1) | $ (0.13) | $ (0.35) | $ (0.37) |
Diluted | $ (0.1) | $ (0.13) | $ (0.35) | $ (0.37) |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Unaudited) - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in-Capital | Accumulated Deficit | Accumulated Other Comprehensive Loss | Treasury stock |
Beginning balance, shares at Dec. 31, 2021 | 76,447,287 | |||||
Beginning balance at Dec. 31, 2021 | $ 192,194 | $ 763 | $ 197,868 | $ (463) | $ 8 | $ (5,982) |
Net loss | (28,563) | (28,563) | ||||
Common stock repurchase | (266) | (266) | ||||
Options exercised, shares | 629,484 | |||||
Options exercised | 2,361 | $ 6 | 2,355 | |||
Foreign currency translation | (1,505) | (1,505) | ||||
Employee stock purchase plan | 100 | 100 | ||||
Stock-based compensation | 7,052 | 7,052 | ||||
Ending balance, shares at Sep. 30, 2022 | 77,076,771 | |||||
Ending balance at Sep. 30, 2022 | 171,373 | $ 769 | 207,109 | (29,026) | (1,497) | (5,982) |
Beginning balance, shares at Jun. 30, 2022 | 76,537,568 | |||||
Beginning balance at Jun. 30, 2022 | 176,938 | $ 764 | 202,367 | (19,302) | (909) | (5,982) |
Net loss | (9,724) | (9,724) | ||||
Options exercised, shares | 539,203 | |||||
Options exercised | 2,060 | $ 5 | 2,055 | |||
Foreign currency translation | (588) | (588) | ||||
Employee stock purchase plan | 100 | 100 | ||||
Stock-based compensation | 2,587 | 2,587 | ||||
Ending balance, shares at Sep. 30, 2022 | 77,076,771 | |||||
Ending balance at Sep. 30, 2022 | 171,373 | $ 769 | 207,109 | (29,026) | (1,497) | (5,982) |
Beginning balance, shares at Dec. 31, 2022 | 77,770,588 | |||||
Beginning balance at Dec. 31, 2022 | 140,928 | $ 776 | 213,956 | (67,789) | (33) | (5,982) |
Net loss | (28,282) | (28,282) | ||||
Issuance of common stock, shares | 4,312,500 | |||||
Issuance of common stock | $ 68,453 | $ 43 | 68,410 | |||
Options exercised, shares | 379,705 | 435,673 | ||||
Options exercised | $ 2,535 | $ 5 | 2,530 | |||
Foreign currency translation | (1,012) | (1,012) | ||||
Employee stock purchase plan | 828 | 828 | ||||
Employee stock purchase plan, shares | 37,146 | |||||
Stock-based compensation | $ 10,294 | 10,294 | ||||
Ending balance, shares at Sep. 30, 2023 | 82,555,907 | 82,555,907 | ||||
Ending balance at Sep. 30, 2023 | $ 193,744 | $ 824 | 296,018 | (96,071) | (1,045) | (5,982) |
Beginning balance, shares at Jun. 30, 2023 | 82,536,046 | |||||
Beginning balance at Jun. 30, 2023 | 199,038 | $ 824 | 292,350 | (87,739) | (415) | (5,982) |
Net loss | (8,332) | (8,332) | ||||
Options exercised, shares | 19,861 | |||||
Options exercised | 70 | 70 | ||||
Foreign currency translation | (630) | (630) | ||||
Employee stock purchase plan | 86 | 86 | ||||
Stock-based compensation | $ 3,512 | 3,512 | ||||
Ending balance, shares at Sep. 30, 2023 | 82,555,907 | 82,555,907 | ||||
Ending balance at Sep. 30, 2023 | $ 193,744 | $ 824 | $ 296,018 | $ (96,071) | $ (1,045) | $ (5,982) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical) $ in Thousands | 6 Months Ended |
Jun. 30, 2023 USD ($) | |
Issuance costs | $ 827 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 USD ($) | Sep. 30, 2022 USD ($) | |
Cash flows from operating activities | ||
Net loss | $ (28,282) | $ (28,563) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation and amortization | 10,602 | 9,624 |
Allowance for doubtful accounts | 147 | |
Provision for excess and obsolete inventories | 2,053 | (91) |
Stock-based compensation | 10,294 | 7,052 |
Other | (1,428) | (1,295) |
Changes in other assets and liabilities, net of acquisitions: | ||
Accounts receivable | 3,706 | (10,227) |
Inventories | (35,558) | (15,316) |
Accounts payable | 12,468 | 951 |
Accrued expenses | 3,718 | 176 |
Accrued legal settlement | (22,000) | |
Income tax receivable/payable | (533) | 297 |
Other assets and liabilities | (2,704) | 1,442 |
Net cash used in operating activities | (47,517) | (35,950) |
Cash flows from investing activities | ||
Purchase of office building | (18,300) | |
Purchases of property and equipment | (21,893) | (15,637) |
Proceeds from sale of property and equipment | 795 | 642 |
Purchases of intangible assets | (933) | (1,720) |
Acquisition of Disior, net of cash received | (18,504) | |
Net cash used in investing activities | (22,031) | (53,519) |
Cash flows from financing activities | ||
Proceeds from draw on term loan | 20,000 | |
Proceeds from issuance of long-term debt | 16,000 | |
Payments on long-term debt | (568) | (367) |
Payments of debt issuance costs | (420) | |
Proceeds from issuance of common stock, net of issuance costs | 68,453 | |
Proceeds from exercise of stock options | 2,535 | 2,224 |
Proceeds from employee stock purchase plan | 560 | |
Payments on earnout liability | (5,500) | (500) |
Net cash provided by financing activities | 65,480 | 36,937 |
Effect of exchange rate changes on cash | 549 | (495) |
Net decrease in cash | (3,519) | (53,027) |
Cash at beginning of period | 38,468 | 109,352 |
Cash at end of period | 34,949 | 56,325 |
Supplemental disclosures of cash flow information: | ||
Restricted cash (Note 5) | 1,000 | |
Cash paid for income taxes | 610 | 788 |
Cash paid for interest | 3,342 | 2,111 |
Purchase of property and equipment included in accounts payable | $ 4,842 | $ 2,363 |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Pay vs Performance Disclosure | ||||
Net Income (Loss) | $ (8,332) | $ (9,724) | $ (28,282) | $ (28,563) |
Insider Trading Arrangements
Insider Trading Arrangements | 9 Months Ended |
Sep. 30, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Business and Basis of Presentat
Business and Basis of Presentation | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Business and Basis of Presentation | NOTE 1. BUSINESS AND BASIS OF PRESENTATION Business Paragon 28, Inc. (collectively with its subsidiaries, “we,” “us,” “our,” “P28” or the “Company”) develops, distributes, and sells medical devices in the foot and ankle segment of the orthopedic implant marketplace. Our approach to product development is procedurally focused, resulting in a full range of procedure-specific foot and ankle products designed specifically for foot and ankle anatomy. Our products and product families include plates and plating systems, screws, staples, and nails aimed to address all major foot and ankle procedures including fracture fixation, forefoot or hallux valgus - which includes bunion and hammertoe, ankle, flatfoot or progressive collapsing foot deformity ("PCDF"), charcot foot and orthobiologics. P28 is a United States (“U.S.”) based company incorporated in the State of Delaware, with headquarters in Englewood, Colorado. Our sales representatives and distributors are located globally with the majority concentrated in the U.S., Australia, South Africa, and the United Kingdom. Basis of Presentation and Consolidation The accompanying Condensed Consolidated Financial Statements include the accounts of Paragon 28, Inc. and its subsidiaries, all of which are wholly-owned. The accompanying Condensed Consolidated Financial Statements have been prepared in conformity with accounting principles generally accepted in the U.S. (“U.S. GAAP”) and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) for interim financial information. Accordingly, they do not include all of the information required by U.S. GAAP for complete financial statements. The interim Condensed Consolidated Financial Statements reflect all adjustments that are of a normal recurring nature and that are considered necessary for a fair representation of the results for the periods presented and should be read in conjunction with the audited Consolidated Financial Statements and notes thereto for the year ended December 31, 2022, which include a complete set of footnote disclosures. The audited Consolidated Financial Statements and notes thereto for the year ended December 31, 2022, are included in the Company’s Annual filing on Form 10-K filed with the SEC on March 2, 2023. The results for interim periods are not necessarily indicative of the results that may be expected for a full fiscal year or for any other future period. All intercompany balances and transactions have been eliminated in consolidation. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Use of Estimates The preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Because future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates. Any changes in these estimates will be reflected in the Company’s Condensed Consolidated Financial Statements. Significant items subject to such estimates and assumptions include the determination of the collectability of trade receivables, inventory obsolescence, impairment of long-lived assets, recoverability of goodwill and intangible assets, contingent earn-out liabilities, income taxes and stock-based compensation. Foreign Currency Translation The Condensed Consolidated Financial Statements are presented in U.S. dollars. The Company’s non-U.S. subsidiaries have a functional currency (i.e., the currency in which operational activities are primarily conducted) that is other than the U.S. dollar, generally the currency of the country in which such subsidiaries are domiciled. Such subsidiaries’ assets and liabilities are translated into U.S. dollars at quarter-end exchange rates, while revenue and expenses are translated at average exchange rates during the quarter based on the daily closing exchange rates. Adjustments that result from translating amounts from a subsidiary’s functional currency to U.S. dollars are reported in Accumulated Other Comprehensive Loss, net of tax. Significant Accounting Policies There have been no changes in the Company's significant accounting policies as disclosed in Note 2 to our audited Consolidated Financial Statements included in our 2022 Annual Report on Form 10-K. Recently Adopted Accounting Pronouncements In June 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”), which requires entities to estimate all expected credit losses for certain types of financial instruments, including trade receivables, held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. The updated guidance also expands the disclosure requirements to enable users of financial statements to understand the entity’s assumptions, models and methods for estimating expected credit losses over the entire contractual term of the instrument from the date of initial recognition of that instrument. ASU 2016-13, as subsequently amended for various technical issues, is effective for emerging growth companies following private company adoption dates for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2022, with early adoption permitted. The Company adopted ASU 2016-13 effective January 1, 2023 . The adoption of this guidance did not have a significant impact on the Company's Condensed Consolidated Financial Statements and related disclosures. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740) (“ASU 2019-12”), which is part of the FASB’s overall simplification initiative to reduce the costs and complexity of applying accounting standards while maintaining or improving the usefulness of the information provided to users of financial statements. ASU 2019-12 simplifies accounting guidance for intra-period allocations, deferred tax liabilities, year-to-date losses in interim periods, franchise taxes, step-up in tax basis of goodwill, separate entity financial statements, and interim recognition of tax laws or rate changes. ASU 2019-12 is effective for emerging growth companies following private company adoption dates in fiscal years beginning after December 15, 2021, and interim periods within fiscal years beginning after December 15, 2022, with early adoption permitted. The Company adopted ASU 2019-12 effective January 1, 2023 . The adoption of this guidance did not have a significant impact on the Company's Condensed Consolidated Financial Statements and related disclosures. |
Business Combination
Business Combination | 9 Months Ended |
Sep. 30, 2023 | |
Business Combinations [Abstract] | |
Business Combination | NOTE 3. BUSINESS COMBINATION Disior Acquisition On January 10, 2022 (“Disior Acquisition Date”), the Company entered into a Securities Purchase Agreement (“SPA”) with Disior LTD. (“Disior”) and acquired 100 % of the outstanding equity of Disior (the “Disior Acquisition”). The aggregate purchase price of the Disior Acquisition was approximately $ 26,246 inclusive of an earn-out provision with a fair value of $ 6,550 and certain net working capital adjustments and deferred payments totaling a net payable of $ 222 . The SPA provided for potential earn-out consideration to the seller in connection with the achievement of certain milestones with various expiration dates through the second anniversary of the Disior Acquisition Date. The earn-out has a maximum payment not to exceed $ 8,000 in the aggregate. If an individual milestone is not met by the specified milestone expiration date, the earn-out related to that specific milestone will not be paid. The acquisition was primarily funded by a $ 20,000 draw on the Company's term loan from Midcap. The Company has accounted for the acquisition of Disior under ASC Topic 805, Business Combinations (“ASC 805”). Disior’s results of operations are included in the Condensed Consolidated Financial Statements beginning after January 10, 2022, the Disior Acquisition Date. The following table summarizes the purchase price: Consideration paid Cash consideration $ 19,696 Contingent consideration 6,550 Total consideration $ 26,246 The following table summarizes the fair values of the assets acquired and liabilities assumed as of the Disior Acquisition Date: Assets acquired: Cash and cash equivalents $ 1,192 Other current assets 410 Intangible assets 6,800 Goodwill 19,136 Total assets acquired 27,538 Liabilities assumed: Accruals and other current liabilities 615 Deferred tax liabilities, net 677 Total liabilities assumed 1,292 Net assets acquired $ 26,246 Identified intangible assets consist of tradenames and developed technology. The fair value of each were determined with the assistance of an external valuation specialist using a combination of the income, market, cost approach, and relief from royalty rate method, in accordance with ASC 805. The purchase consideration was allocated to the identifiable net assets acquired based on estimated fair values at the date of the acquisition. The excess of the fair value of the purchase consideration over the fair value of the identifiable assets and liabilities, if any, was recorded as goodwill. The goodwill is attributable to the expected synergies with the Company’s existing operations. The useful life on intangible assets was determined by management to be in line with the Company’s policy on intangible assets. Both determinations are outlined in the table below: Fair Value Developed technology $ 6,400 Tradenames 400 Total intangible assets $ 6,800 The entire amount of the purchase price allocated to goodwill will not be deductible for income tax purposes under the Finnish Income Tax Act. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 9 Months Ended |
Sep. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | NOTE 4. GOODWILL AND INTANGIBLE ASSETS Goodwill As of September 30, 2023, and December 31, 2022, goodwill was $ 25,465 . Intangibles Intangible assets as of September 30, 2023, are as follows: Gross Carrying Amount Accumulated Amortization Net Carrying Amount Trademarks and tradenames, indefinite-lived $ 971 $ — $ 971 Patents, definite-lived 7,534 2,578 4,956 Customer relationships 1,733 496 1,237 Developed technology 17,690 3,059 14,631 Other intangibles 30 23 7 Total intangible assets, net $ 27,958 $ 6,156 $ 21,802 Intangible assets as of December 31, 2022 , are as follows: Gross Carrying Amount Accumulated Amortization Net Carrying Amount Trademarks, indefinite-lived $ 901 $ — $ 901 Patents, definite-lived 6,671 2,370 4,301 Customer relationships 1,733 279 1,454 Developed technology 17,690 1,973 15,717 Other intangibles 30 16 14 Total intangible assets, net $ 27,025 $ 4,638 $ 22,387 Amortization expense is included in Selling, general, and administrative expenses and was $ 509 and $ 440 for the three months ended September 30, 2023 and 2022, respectively. Amortization expense for the nine months ended September 30, 2023 and 2022 totaled $ 1,519 and $ 2,290 , respectively. Expected future amortization expense is as follows: 2023 (Remaining) $ 505 2024 1,965 2025 1,924 2026 1,924 2027 1,924 No impairment charges related to intangibles and goodwill were recorded for the three and nine months ended September 30, 2023 and 2022 . |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 9 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | NOTE 5. FAIR VALUE OF FINANCIAL INSTRUMENTS The Company measures certain financial assets and liabilities at fair value. There is a fair value hierarchy which prioritizes inputs used in measuring fair value into three broad levels: Level 1 - Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2- Includes other inputs that are directly or indirectly observable in the marketplace, such as quoted market prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data. Level 3 - Unobservable inputs which are supported by little or no market activity. The Company's significant financial assets and liabilities measured at fair value as of September 30, 2023 were as follows: Level 1 Level 2 Level 3 Total Financial Assets: Interest rate swap $ — 2,024 — $ 2,024 Financial Liabilities: Contingent consideration $ — — 1,770 $ 1,770 The Company’s Level 2 asset pertains to an interest rate swap associated with the Company's Zions Facility, used to manage interest rate risk related to variable rate borrowings and manage exposure to the variability of cash flows. The interest rate swap is not designated for hedge accounting and is measured utilizing inputs observable in active markets. For the three and nine months ended September 30, 2023, the $ 2,024 change in fair value of the Company's interest rate swap is recorded in Other assets on the Condensed Consolidated Balance Sheet and Other income (expense) within the Condensed Consolidated Statement of Operations and Comprehensive Loss. The Company’s Level 3 instruments consist of contingent consideration. The following table provides a reconciliation of the Level 3 earn-out liabilities for the nine months ended September 30, 2023: Balance, December 31, 2022 $ 3,640 Achieved milestones reclassified to accrued expenses ( 2,500 ) Change in fair value of earn-out liabilities 630 Balance, September 30, 2023 $ 1,770 The current portion of contingent earn-out liability is included in Other-current liabilities and the non-current portion is included in Other long-term liabilities on the Condensed Consolidated Balance Sheets. As of September 30, 2023, the current portion was $ 1,444 and the non-current portion was $ 326 . During the three and nine months ended September 30, 2023 , we reassessed the estimate of the earn-out liabilities which resulted in a net increase of $ 310 and $ 630 , recorded in Other expense within the Condensed Consolidated Statement of Operations and Comprehensive Loss for the three and nine months ended September 30, 2023, respectively. As of December 31, 2022, three project milestones associated with the Disior acquisition and two project milestones associated with the Additive Orthopaedics acquisition were included in Accrued expenses on the Consolidated Balance Sheet totaling $ 5,000 and $ 1,500 , respectively. During the nine months ended September 30, 2023, $ 500 was paid in cash for one of the Additive Orthopaedics milestones and $ 5,000 was paid in cash for the Disior milestones. As of September 30, 2023, the remaining $ 1,000 related to the Additive Orthopaedics milestone was included in Accrued expenses on the Condensed Consolidated Balance Sheet. The total $ 1,000 accrual is included as restricted cash within the Condensed Consolidated Statement of Cash Flows for the nine months ended September 30, 2023. During the second quarter of 2023, the Company completed the fourth project milestone related to the Disior acquisition totaling $ 2,000 and during the third quarter of 2023 completed another project milestone associated with the Additive Orthopaedics acquisition totaling $ 500, both of which are also included in Accrued expenses on the Condensed Consolidated Balance Sheet as of September 30, 2023. For additional information on the Additive Orthopaedics acquisition refer to Note 3 to our Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. |
Debt
Debt | 9 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
Debt | NOTE 6. DEBT Long-term debt as of September 30, 2023, and December 31, 2022, consists of the following: September 30, 2023 December 31, 2022 MidCap Term Loan $ 30,000 $ 30,000 Zions Term Loan 15,093 15,573 Bank of Ireland Note Payable — 86 45,093 45,659 Less: deferred issuance costs ( 2,165 ) ( 2,749 ) Total debt, net of issuance costs 42,928 42,910 Less: current portion ( 640 ) ( 728 ) Long-term debt, net, less current maturities $ 42,288 $ 42,182 MidCap Credit Agreements On May 6, 2021, the Company entered into a credit agreement with MidCap Financial Trust to provide a total of $ 70,000 including up to a $ 30,000 revolving loan (“MidCap Revolving Loan”) and up to a $ 40,000 term loan (“MidCap Term Loan”), secured by substantially all the Company’s assets (“MidCap Credit Agreements”). The MidCap Term Loan was comprised of two tranches, the first of which provided a commitment amount of $ 10,000 , and the second a commitment of $ 30,000 . The MidCap Term Loan and Midcap Revolving Loan bore a variable interest rate of LIBOR plus 6 % and LIBOR plus 3 %, respectively, and mature on the earlier of May 1, 2026 , or a change in control event (the "Termination Date"). The entire principal balances of the MidCap Revolving Loan and MidCap Term Loan are due on the Termination Date. Interest payments are payable monthly with optional principal prepayments allowed under the MidCap Credit Agreements. The Midcap Credit Agreements required us to maintain minimum net product sales and minimum consolidated EBITDA, (each term as defined in the Midcap Credit Agreements), for the preceding twelve month period. On November 9, 2022, the Company entered into an amendment to the MidCap Credit Agreements. The amendment to the Midcap Revolving Loan provides up to $ 50,000 in total borrowing capacity. The MidCap amendments modified the MidCap Credit Agreements to include provisions related to the transition from the LIBOR Interest Rate plus Applicable Margin to the SOFR Interest Rate plus Applicable Margin, maintaining the Applicable Margin of 6 % under the MidCap Term Loan and increasing the Applicable Margin from 3 % to 3.75 % under the Midcap Revolving Loan. In addition, the MidCap amendments amended certain covenants, terms and provisions in the Midcap Credit Agreements to, among other things, modify the covenant levels for the Minimum Net Product Sales financial covenant and to remove the Minimum Consolidated EBITDA financial covenant. As of September 30, 2023, the Company was in compliance with all financial covenants under the amended Midcap Credit Agreements. Total debt issuance costs associated with the MidCap Credit Agreements were $ 1,942 . Amortization expense associated with such debt issuance costs totaled $ 183 and $ 552 for the three and nine months ended September 30, 2023 , respectively, and $ 165 and $ 409 for the three and nine months ended September 30, 2022, respectively, and is included in Interest expense on the Condensed Consolidated Statements of Operations and Comprehensive Loss. On November 2, 2023, the Company paid all outstanding amounts owed under the MidCap Credit Agreements utilizing a portion of the proceeds from the Ares Credit Facilities, and concurrently terminated the Midcap Credit Facilities under the MidCap Credit Agreements. For additional information about the Ares Credit Facilities, refer to Note 14. Zions Term Loan Facility On March 24, 2022, the Company entered into a secured term loan facility (the “Zions Facility”) with Zions Bancorporation, N.A., dba Vectra Bank Colorado, in the principal amount of $ 16,000 . The loans under the Zions Facility (i) bear interest at a variable rate per annum equal to the sum of (a) a one-month Term SOFR based rate, plus (b) 1.75 %, adjusted on a monthly basis and (ii) mature on March 24, 2037 . The Company is the fixed rate payor on an interest rate swap contract that effectively fixes the SOFR-based index utilized to determine the interest rate charged on the Zions Facility at 4.25 % until maturity. Principal and interest payments are payable monthly , with optional prepayments allowed without premium or penalty. Effective as of November 10, 2022, the Company entered into the First Amendment to the Zions Facility. The amendment to the Zions Facility amends the financial covenants to require the Company to maintain (i) the Liquidity Ratio, if the Cash Flow as of the last day of any quarter measured on a trailing three month basis is less than or equal to $ 0 , and (ii) the Fixed Charge Coverage Ratio which will be calculated as of the last day of each quarter on a trailing four quarter basis, as well as a certain level of Liquidity, if the Cash Flow is greater than $ 0 . In addition, a Net Revenue Growth covenant was added which will be calculated as of the last day of each quarter on a year-over- year basis. As of September 30, 2023, the Company was in compliance with all financial covenants under the amended Zions Facility. Total debt issuance costs associated with the Zions Facility were $ 223 . Amortization expense associated with such debt issuance costs totaled $ 4 and $ 12 for the three and nine months ended September 30, 2023, and is included in Interest expense on the Consolidated Statements of Operations and Comprehensive Loss, respectively and totaled $ 4 and $ 9 for th e three and nine months ended September 30, 2022. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2023 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | NOTE 7. STOCKHOLDERS’ EQUITY Under its Amended and Restated Certificate of Incorporation, the Company has a total of 310,000,000 shares of capital stock authorized for issuance, consisting of 300,000,000 shares of common stock, par value of $ 0.01 per share, and 10,000,000 shares of convertible preferred stock, par value of $ 0.01 per share. Common Stock On January 30, 2023, the Company completed an underwritten public offering (“the Offering”) of 6,500,000 shares of its common stock at an offering price of $ 17.00 per share, which consisted of 3,750,000 shares of common stock issued and sold by the Company and 2,750,000 shares of common stock sold by certain selling securityholders. On February 17, 2023, the underwriters exercised in full their option to purchase an additional 562,500 shares and 412,500 shares of common stock from the Company and the selling securityholders, respectively. The Company received aggregate net proceeds from the Offering of approximat ely $ 68,453 a fter deducting underwriting discounts and commissions and offering expenses payable by the Company. The selling securityholders received aggregate net proceeds from the Offering of appr oximately $ 50,700 after deducting underwriting discounts and commissions. The Company did not receive any of the proceeds from the sale of shares of Com mon Stock by the selling securityholders. Treasury Stock The Company did no t purchase any of its common stock during the nine months ended September 30, 2023 and 2022. All previously repurchased shares were recorded in Treasury stock at cost. |
Loss Per Share
Loss Per Share | 9 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
Loss Per Share | NOTE 8. LOSS PER SHARE Basic net loss per share is computed by dividing net loss attributable to common stockholders (the numerator) by the weighted average number of common stock outstanding for the period (the denominator). Diluted net income per share of common stock attributable to common stockholders is computed by dividing net income by the weighted average number of shares of common stock outstanding during the period adjusted for the dilutive effects of common stock equivalents using the treasury stock method or the method based on the nature of such securities. In periods when losses from operations are reported, the weighted-average number of shares of common stock outstanding excludes common stock equivalents because their inclusion would be anti-dilutive. The computation of net loss per share for the three and nine months ended September 30, 2023 and 2022, respectively was as follows: Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Net loss $ ( 8,332 ) $ ( 9,724 ) $ ( 28,282 ) $ ( 28,563 ) Weighted-average common stock outstanding: Basic 82,548,892 76,850,949 81,878,814 76,595,118 Diluted 82,548,892 76,850,949 81,878,814 76,595,118 Loss per share: Basic $ ( 0.10 ) $ ( 0.13 ) $ ( 0.35 ) $ ( 0.37 ) Diluted $ ( 0.10 ) $ ( 0.13 ) $ ( 0.35 ) $ ( 0.37 ) The following outstanding potentially dilutive securities were excluded from the calculation of diluted net loss per share attributable to common stockholders because their impact would have been antidilutive for the period presented: As of September 30, 2023 2022 Stock options 6,119,477 7,304,770 Restricted stock units 1,392,087 144,547 |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Compensation | NOTE 9. STOCK-BASED COMPENSATION Employee Stock Purchase Plan The Company’s Employee Stock Purchase Plan (“ESPP”) provides participating employees with the opportunity to purchase the Company’s common stock at 85 % of the market price at the lesser of the date the purchase right is granted or exercisable. Eligible employees can contribute up to 15 % of their gross base earnings for purchases under the ESPP through regular payroll deductions, limited to $ 25,000 worth of the Company’s shares of common stock for each calendar year in which the purchase right is outstanding. The Company currently holds offerings consisting of six month periods commencing on January 1st and July 1st of each calendar year, with a single purchase date at the end of the purchase period on June 30th and December 31st of each calendar year. The Company issued 37,146 and 17,060 shares upon exercise of purchase rights during the nine months ended September 30, 2023 and 2022, respectively. The Company recognizes compensation expense on a straight-line basis over the service period. During the three months ended September 30, 2023 and 2022, the Company recognized $ 86 and $ 100 , respectively, of compensation expense related to the ESPP. During the nine months ended September 30, 2023 and 2022, the Company recognized $ 268 and $ 100 , respectively, of compensation expense related to the ESPP. Stock Options The following table summarizes the Company’s stock option plan and the activity for the nine months ended September 30, 2023: Shares Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (Years) Outstanding, December 31, 2022 6,538,536 $ 10.02 7.36 Granted 225,000 18.33 Exercised or released ( 379,705 ) 6.68 Forfeited or expired ( 264,354 ) 14.80 Outstanding, September 30, 2023 6,119,477 $ 10.32 6.89 Exercisable, September 30, 2023 4,232,008 $ 8.22 6.34 Vested and expected to vest at September 30, 2023 6,112,107 $ 10.31 6.89 During the three months ended September 30, 2023 and 2022 , the Company recognized $ 1,724 and $ 2,254 , respectively, of compensation expense related to stock options. During the nine months ended September 30, 2023 and 2022 , the Company recognized $ 5,320 and $ 6,351 , respectively of compensation expense related to stock options. Stock-based compensation expenses are recorded in Selling, general and administrative expenses in the Condensed Consolidated Statements of Operations and Comprehensive Loss. Restricted Stock Units The following table summarizes the Company’s restricted stock units activity for the nine months ended September 30, 2023. Restricted Stock Units Weighted-Average Fair Value Outstanding, December 31, 2022 964,054 $ 17.74 Granted 630,618 17.82 Vested ( 55,968 ) 16.97 Forfeited or expired ( 146,617 ) 17.81 Outstanding, September 30, 2023 1,392,087 $ 17.80 Vested and expected to vest at September 30, 2023 1,378,740 $ 17.80 During the three and nine months ended September 30, 2023 , the Company recognized $ 1,788 and $ 4,974 , respectively, of compensation expense related to RSUs. During the three and nine months ended September 30, 2022 , the Company recognized $ 332 and $ 701 , respectively of compensation expense related to RSUs. Stock-based compensation expenses are recorded in Selling, general and administrative expenses in the Condensed Consolidated Statements of Operations and Comprehensive Loss. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | NOTE 10. INCOME TAXES The effective tax rates for the nine months ended September 30, 2023 and 2022 are as follows: Nine Months Ended September 30, 2023 2022 Effective tax rate ( 0.322 %) ( 1.057 %) For the three months ended September 30, 2023 and 2022 , the Company recorded a tax benefit of $ 108 and tax expense of $ 201 , respectively. For nine months ended September 30, 2023 and 2022 , the Company recorded tax expense of $ 90 and $ 306 , respectively. The Company’s 2023 and 2022 income tax expense and rates differed from the amount of income tax determined by applying the U.S. Federal income tax rate to pre-tax income primarily as a result of the U.S., Finland, Germany, United Kingdom and Italy jurisdictions that have a full valuation allowance recorded on deferred tax assets. In addition, the tax rate is lower than the U.S. statutory federal tax rate as a result of foreign earnings that are taxed at lower tax rates. The Company continues to monitor the realization of its deferred tax assets and assesses the need for a valuation allowance. The Company analyzes available positive and negative evidence to determine if a valuation allowance is needed based on the weight of the evidence. This objectively verifiable evidence includes the current and prior two years' profit and loss positions after considering pre-tax book income plus or minus permanent adjustments as well as other positive and negative evidence available. This process requires management to make estimates, assumptions, and judgments that are uncertain in nature. The Company has established a valuation allowance with respect to deferred tax assets in the U.S., Finland, Germany, United Kingdom and Italy and continues to monitor and assess potential valuation allowances in all its jurisdictions. |
Commitments And Contingencies
Commitments And Contingencies | 9 Months Ended |
Sep. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | NOTE 11. COMMITMENTS AND CONTIGENCIES Legal Proceedings The Company is involved in various lawsuits, claims, inquiries, and other regulatory and compliance matters, most of which are routine to the nature of our business. When it is probable that a loss will be incurred and where a range of the loss can be reasonably estimated, the best estimate within the range is accrued. When the best estimate within the range cannot be determined, the low end of the range is accrued. The ultimate resolution of these claims could affect future results of operations should the exposure be materially different from the estimates or should liabilities be incurred that were not previously accrued. Potential insurance reimbursements are not offset against potential liabilities. As of September 30 2023, the Company is not involved in any legal proceedings that could have a material adverse effect on its condensed consolidated financial position. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2023 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | NOTE 12. RELATED PARTY TRANSACTIONS The Company has a license agreement dated July 1, 2017, for certain intellectual property with an entity that is affiliated with one of the directors of the Company, under which the Company pays a royalty of four percent ( 4 %) of net revenue related to the licensed intellectual property for the 15 years following the date of first sale, including a minimum annual payment of $ 250 . The term of the agreement is 20 years , and automatically renews for five-year periods thereafter. Payments to the entity under this license agreement totaled $ 32 and $ 28 for the three months ended September 30, 2023 and 2022 , respectively. Payments to the entity under this license agreement totaled $ 233 and $ 221 for the nine months ended September 30, 2023 and 2022, respectively. Amounts payable to this entity as of September 30, 2023, and December 31, 2022 , were $ 128 and $ 164 , respectively. The Company paid professional services fees to a related party totaling $ 123 and $ 0 for the three months ended September 30, 2023 and 2022 , respectively, and such fees are included in Selling, general, and administrative expense in the Condensed Consolidated Statements of Operations and Comprehensive Loss. The Company paid professional services fees to a related party totaling $ 238 and $ 266 for the nine months ended September 30, 2023 and 2022, respectively. Amounts payable as of September 30, 2023 and December 31, 2022 to this related party were $ 66 and $ 0 , respectively. |
Segment and Geographic Informat
Segment and Geographic Information | 9 Months Ended |
Sep. 30, 2023 | |
Segment Reporting [Abstract] | |
Segment and Geographic Information | NOTE 13. SEGMENT AND GEOGRAPHIC INFORMATION The following table represents total net revenue by geographic area, based on the location of the customer for the three and nine months ended September 30, 2023 and 2022, respectively. Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 United States $ 44,548 $ 39,960 $ 131,793 $ 112,781 International 8,235 6,046 24,035 17,094 Total net revenue $ 52,783 $ 46,006 $ 155,828 $ 129,875 No individual country with net revenue originating outside of the United States accounted for more than 10% of consolidated net revenue for three and nine months ended September 30, 2023 and 2022. The following table represents total non-current assets, excluding deferred taxes, by geographic area as of September 30, 2023 and December 31, 2022, respectively. September 30, 2023 December 31, 2022 United States $ 90,373 $ 79,458 Finland 25,170 25,581 Other International 8,888 6,546 Total assets $ 124,431 $ 111,585 |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 14. SUBSEQUENT EVENTS On November 2, 2023, the Company and its wholly-owned subsidiary, Paragon Advanced Technologies, Inc. (“Paragon Advanced Technologies” and, together with the Company, the “Borrowers”), entered into a new credit agreement (the “Ares Credit Agreement”) with Ares Capital Corporation, as administrative agent and collateral agent, and ACF FINCO I LP, as revolving agent (together, “Ares Capital”), and the lenders party thereto, to provide senior secured credit facilities to the Borrowers in an aggregate principal amount of $ 150,000 , inclusive of a revolving credit facility of up to $ 50,000 (the “Ares Revolving Loan”) and a term loan facility of up to $ 100,000 (the “Ares Term Loan”). The obligations under the Ares Credit Agreement are guaranteed by each of the Borrowers’ current and future domestic subsidiaries, and secured by liens on substantially all of the Borrowers’ and guarantors’ present and after-acquired assets, in each case, subject to certain customary exceptions. In connection with the closing of the Ares Credit Agreement, the Company drew down $ 25,000 and $ 75,000 on the Ares Revolving Loan and Ares Term Loan, respectively. The Ares Revolving Loan and Ares Term Loan bear interest at variable rates of Term SOFR plus 4 % and Term SOFR plus 6.75 %, respectively, subject in the case of the Ares Term Loan to certain step-downs and adjustments as set forth in the Ares Credit Agreement, and mature on the earlier of (i) November 2, 2028 and (ii) with respect to the Ares Revolving Loan, 6 months prior to the maturity date of any other indebtedness in a principal or stated amount in excess of $ 12,500 . The Ares Credit Agreement contains a financial covenant requiring us to maintain certain minimum revenue levels. In connection with the entry into the Ares Credit Agreement, the Company terminated the commitments and satisfied all outstanding obligations under the MidCap Credit Agreements. Refer to Note 6 for additional information. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Consolidation | Basis of Presentation and Consolidation The accompanying Condensed Consolidated Financial Statements include the accounts of Paragon 28, Inc. and its subsidiaries, all of which are wholly-owned. The accompanying Condensed Consolidated Financial Statements have been prepared in conformity with accounting principles generally accepted in the U.S. (“U.S. GAAP”) and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) for interim financial information. Accordingly, they do not include all of the information required by U.S. GAAP for complete financial statements. The interim Condensed Consolidated Financial Statements reflect all adjustments that are of a normal recurring nature and that are considered necessary for a fair representation of the results for the periods presented and should be read in conjunction with the audited Consolidated Financial Statements and notes thereto for the year ended December 31, 2022, which include a complete set of footnote disclosures. The audited Consolidated Financial Statements and notes thereto for the year ended December 31, 2022, are included in the Company’s Annual filing on Form 10-K filed with the SEC on March 2, 2023. The results for interim periods are not necessarily indicative of the results that may be expected for a full fiscal year or for any other future period. All intercompany balances and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of the financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Because future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates. Any changes in these estimates will be reflected in the Company’s Condensed Consolidated Financial Statements. Significant items subject to such estimates and assumptions include the determination of the collectability of trade receivables, inventory obsolescence, impairment of long-lived assets, recoverability of goodwill and intangible assets, contingent earn-out liabilities, income taxes and stock-based compensation. |
Foreign Currency Translation | Foreign Currency Translation The Condensed Consolidated Financial Statements are presented in U.S. dollars. The Company’s non-U.S. subsidiaries have a functional currency (i.e., the currency in which operational activities are primarily conducted) that is other than the U.S. dollar, generally the currency of the country in which such subsidiaries are domiciled. Such subsidiaries’ assets and liabilities are translated into U.S. dollars at quarter-end exchange rates, while revenue and expenses are translated at average exchange rates during the quarter based on the daily closing exchange rates. Adjustments that result from translating amounts from a subsidiary’s functional currency to U.S. dollars are reported in Accumulated Other Comprehensive Loss, net of tax. |
Significant Accounting Policies | Significant Accounting Policies There have been no changes in the Company's significant accounting policies as disclosed in Note 2 to our audited Consolidated Financial Statements included in our 2022 Annual Report on Form 10-K. |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements In June 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”), which requires entities to estimate all expected credit losses for certain types of financial instruments, including trade receivables, held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. The updated guidance also expands the disclosure requirements to enable users of financial statements to understand the entity’s assumptions, models and methods for estimating expected credit losses over the entire contractual term of the instrument from the date of initial recognition of that instrument. ASU 2016-13, as subsequently amended for various technical issues, is effective for emerging growth companies following private company adoption dates for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2022, with early adoption permitted. The Company adopted ASU 2016-13 effective January 1, 2023 . The adoption of this guidance did not have a significant impact on the Company's Condensed Consolidated Financial Statements and related disclosures. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740) (“ASU 2019-12”), which is part of the FASB’s overall simplification initiative to reduce the costs and complexity of applying accounting standards while maintaining or improving the usefulness of the information provided to users of financial statements. ASU 2019-12 simplifies accounting guidance for intra-period allocations, deferred tax liabilities, year-to-date losses in interim periods, franchise taxes, step-up in tax basis of goodwill, separate entity financial statements, and interim recognition of tax laws or rate changes. ASU 2019-12 is effective for emerging growth companies following private company adoption dates in fiscal years beginning after December 15, 2021, and interim periods within fiscal years beginning after December 15, 2022, with early adoption permitted. The Company adopted ASU 2019-12 effective January 1, 2023 . The adoption of this guidance did not have a significant impact on the Company's Condensed Consolidated Financial Statements and related disclosures. |
Business Combination (Tables)
Business Combination (Tables) - Disior LTD. | 9 Months Ended |
Sep. 30, 2023 | |
Business Acquisition [Line Items] | |
Summary of Purchase Consideration Transferred | The following table summarizes the purchase price: Consideration paid Cash consideration $ 19,696 Contingent consideration 6,550 Total consideration $ 26,246 |
Summary of Fair Values of Assets Acquired and Liabilities Assumed | The following table summarizes the fair values of the assets acquired and liabilities assumed as of the Disior Acquisition Date: Assets acquired: Cash and cash equivalents $ 1,192 Other current assets 410 Intangible assets 6,800 Goodwill 19,136 Total assets acquired 27,538 Liabilities assumed: Accruals and other current liabilities 615 Deferred tax liabilities, net 677 Total liabilities assumed 1,292 Net assets acquired $ 26,246 |
Useful Life Determination of Assets | The useful life on intangible assets was determined by management to be in line with the Company’s policy on intangible assets. Both determinations are outlined in the table below: Fair Value Developed technology $ 6,400 Tradenames 400 Total intangible assets $ 6,800 |
Goodwill And Intangible Assets
Goodwill And Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | Intangible assets as of September 30, 2023, are as follows: Gross Carrying Amount Accumulated Amortization Net Carrying Amount Trademarks and tradenames, indefinite-lived $ 971 $ — $ 971 Patents, definite-lived 7,534 2,578 4,956 Customer relationships 1,733 496 1,237 Developed technology 17,690 3,059 14,631 Other intangibles 30 23 7 Total intangible assets, net $ 27,958 $ 6,156 $ 21,802 Intangible assets as of December 31, 2022 , are as follows: Gross Carrying Amount Accumulated Amortization Net Carrying Amount Trademarks, indefinite-lived $ 901 $ — $ 901 Patents, definite-lived 6,671 2,370 4,301 Customer relationships 1,733 279 1,454 Developed technology 17,690 1,973 15,717 Other intangibles 30 16 14 Total intangible assets, net $ 27,025 $ 4,638 $ 22,387 |
Schedule of Expected Future Amortization Expense | Expected future amortization expense is as follows: 2023 (Remaining) $ 505 2024 1,965 2025 1,924 2026 1,924 2027 1,924 |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Summary of Significant Financial Assets and Liabilities Measured at Fair Value | The Company's significant financial assets and liabilities measured at fair value as of September 30, 2023 were as follows: Level 1 Level 2 Level 3 Total Financial Assets: Interest rate swap $ — 2,024 — $ 2,024 Financial Liabilities: Contingent consideration $ — — 1,770 $ 1,770 |
Schedule of Reconciliation Level 3 Earn-out Liabilities | The following table provides a reconciliation of the Level 3 earn-out liabilities for the nine months ended September 30, 2023: Balance, December 31, 2022 $ 3,640 Achieved milestones reclassified to accrued expenses ( 2,500 ) Change in fair value of earn-out liabilities 630 Balance, September 30, 2023 $ 1,770 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | Long-term debt as of September 30, 2023, and December 31, 2022, consists of the following: September 30, 2023 December 31, 2022 MidCap Term Loan $ 30,000 $ 30,000 Zions Term Loan 15,093 15,573 Bank of Ireland Note Payable — 86 45,093 45,659 Less: deferred issuance costs ( 2,165 ) ( 2,749 ) Total debt, net of issuance costs 42,928 42,910 Less: current portion ( 640 ) ( 728 ) Long-term debt, net, less current maturities $ 42,288 $ 42,182 |
Loss Per Share (Tables)
Loss Per Share (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
Summary of Computation of Net Loss Per Share | The computation of net loss per share for the three and nine months ended September 30, 2023 and 2022, respectively was as follows: Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Net loss $ ( 8,332 ) $ ( 9,724 ) $ ( 28,282 ) $ ( 28,563 ) Weighted-average common stock outstanding: Basic 82,548,892 76,850,949 81,878,814 76,595,118 Diluted 82,548,892 76,850,949 81,878,814 76,595,118 Loss per share: Basic $ ( 0.10 ) $ ( 0.13 ) $ ( 0.35 ) $ ( 0.37 ) Diluted $ ( 0.10 ) $ ( 0.13 ) $ ( 0.35 ) $ ( 0.37 ) |
Summary of Potentially Dilutive Securities Excluded from Calculation of Diluted Net Loss Per Share Attributable to Common Stockholders | The following outstanding potentially dilutive securities were excluded from the calculation of diluted net loss per share attributable to common stockholders because their impact would have been antidilutive for the period presented: As of September 30, 2023 2022 Stock options 6,119,477 7,304,770 Restricted stock units 1,392,087 144,547 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Summary of Stock Option Activity | The following table summarizes the Company’s stock option plan and the activity for the nine months ended September 30, 2023: Shares Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term (Years) Outstanding, December 31, 2022 6,538,536 $ 10.02 7.36 Granted 225,000 18.33 Exercised or released ( 379,705 ) 6.68 Forfeited or expired ( 264,354 ) 14.80 Outstanding, September 30, 2023 6,119,477 $ 10.32 6.89 Exercisable, September 30, 2023 4,232,008 $ 8.22 6.34 Vested and expected to vest at September 30, 2023 6,112,107 $ 10.31 6.89 |
Summary of Restricted Stock Units Activity | The following table summarizes the Company’s restricted stock units activity for the nine months ended September 30, 2023. Restricted Stock Units Weighted-Average Fair Value Outstanding, December 31, 2022 964,054 $ 17.74 Granted 630,618 17.82 Vested ( 55,968 ) 16.97 Forfeited or expired ( 146,617 ) 17.81 Outstanding, September 30, 2023 1,392,087 $ 17.80 Vested and expected to vest at September 30, 2023 1,378,740 $ 17.80 |
Income Taxes (Tables)
Income Taxes (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
Schedule of Effective Tax Rates | The effective tax rates for the nine months ended September 30, 2023 and 2022 are as follows: Nine Months Ended September 30, 2023 2022 Effective tax rate ( 0.322 %) ( 1.057 %) |
Segment and Geographic Inform_2
Segment and Geographic Information (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Total Net Revenue by Geographic Area | The following table represents total net revenue by geographic area, based on the location of the customer for the three and nine months ended September 30, 2023 and 2022, respectively. Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 United States $ 44,548 $ 39,960 $ 131,793 $ 112,781 International 8,235 6,046 24,035 17,094 Total net revenue $ 52,783 $ 46,006 $ 155,828 $ 129,875 |
Schedule of Total Non-current Assets, Excluding Deferred Taxes, by Geographic Area | The following table represents total non-current assets, excluding deferred taxes, by geographic area as of September 30, 2023 and December 31, 2022, respectively. September 30, 2023 December 31, 2022 United States $ 90,373 $ 79,458 Finland 25,170 25,581 Other International 8,888 6,546 Total assets $ 124,431 $ 111,585 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Finite-Lived Intangible Assets [Line Items] | ||||
Impairment of goodwill | $ 0 | $ 0 | $ 0 | $ 0 |
ASU 2016-13 | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Change in Accounting Principle, Accounting Standards Update, Adopted [true false] | true | true | ||
Change in Accounting Principle, Accounting Standards Update, Adoption Date | Jan. 01, 2023 | Jan. 01, 2023 | ||
Change in Accounting Principle, Accounting Standards Update, Immaterial Effect [true false] | true | true | ||
ASU 2019-12 | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Change in Accounting Principle, Accounting Standards Update, Adopted [true false] | true | true | ||
Change in Accounting Principle, Accounting Standards Update, Adoption Date | Jan. 01, 2023 | Jan. 01, 2023 | ||
Change in Accounting Principle, Accounting Standards Update, Immaterial Effect [true false] | true | true |
Business Combination - Addition
Business Combination - Additional Information (Details) - USD ($) | 9 Months Ended | |
Jan. 10, 2022 | Sep. 30, 2022 | |
Business Acquisition [Line Items] | ||
Proceeds from revolving credit facility | $ 20,000,000 | |
Disior LTD. | ||
Business Acquisition [Line Items] | ||
Acquired percentage | 100% | |
Aggregate purchase price of acquisition | $ 26,246,000 | |
Contingent earn-out consideration, estimated fair value | 6,550,000 | |
Net working capital adjustments and deferred payments, net payable | 222,000 | |
Maximum earn out payment | 8,000,000 | |
Disior LTD. | Measurement Period Adjustments | ||
Business Acquisition [Line Items] | ||
Aggregate purchase price of acquisition | 26,246,000 | |
Disior LTD. | Term Loan | ||
Business Acquisition [Line Items] | ||
Proceeds from revolving credit facility | $ 20,000,000 |
Business Combination - Summary
Business Combination - Summary of Purchase Consideration Transferred (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Jan. 10, 2022 | Sep. 30, 2022 | |
Consideration paid | ||
Cash consideration | $ 18,504 | |
Disior LTD. | ||
Consideration paid | ||
Cash consideration | $ 19,696 | |
Contingent consideration | 6,550 | |
Total consideration | $ 26,246 |
Business Combination - Summar_2
Business Combination - Summary of Fair Values of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 | Jan. 10, 2022 |
Assets acquired: | |||
Goodwill | $ 25,465 | $ 25,465 | |
Disior LTD. | |||
Assets acquired: | |||
Cash and cash equivalents | $ 1,192 | ||
Other current assets | 410 | ||
Intangible assets | 6,800 | ||
Goodwill | 19,136 | ||
Total assets acquired | 27,538 | ||
Liabilities assumed: | |||
Accruals and other current liabilities | 615 | ||
Deferred tax liabilities, net | 677 | ||
Total liabilities assumed | 1,292 | ||
Net assets acquired | $ 26,246 |
Business Combination - Useful L
Business Combination - Useful Life Determination of Assets (Details) - Disior LTD. $ in Thousands | 9 Months Ended |
Sep. 30, 2023 USD ($) | |
Business Acquisition [Line Items] | |
Total intangible assets, Fair Value | $ 6,800 |
Developed Technology | |
Business Acquisition [Line Items] | |
Total intangible assets, Fair Value | 6,400 |
Tradenames | |
Business Acquisition [Line Items] | |
Total intangible assets, Fair Value | $ 400 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Finite-Lived Intangible Assets [Line Items] | |||||
Goodwill | $ 25,465,000 | $ 25,465,000 | $ 25,465,000 | ||
Impairment charges related to intangibles | 0 | $ 0 | 0 | $ 0 | |
Impairment charges related to goodwill | 0 | 0 | 0 | 0 | |
Selling, General, and Administrative Expenses | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Amortization expense | $ 509,000 | $ 440,000 | $ 1,519,000 | $ 2,290,000 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Intangible Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Indefinite Lived Intangible Assets By Major Class [Line Items] | ||
Gross Carrying Amount | $ 27,958 | $ 27,025 |
Accumulated Amortization | 6,156 | 4,638 |
Net Carrying Amount | 21,802 | 22,387 |
Trademarks and Tradenames, Indefinite-Lived | ||
Indefinite Lived Intangible Assets By Major Class [Line Items] | ||
Net Carrying Amount | 971 | 901 |
Patents, Definite-Lived | ||
Indefinite Lived Intangible Assets By Major Class [Line Items] | ||
Gross Carrying Amount | 7,534 | 6,671 |
Accumulated Amortization | 2,578 | 2,370 |
Net Carrying Amount | 4,956 | 4,301 |
Customer Relationships | ||
Indefinite Lived Intangible Assets By Major Class [Line Items] | ||
Gross Carrying Amount | 1,733 | 1,733 |
Accumulated Amortization | 496 | 279 |
Net Carrying Amount | 1,237 | 1,454 |
Developed Technology | ||
Indefinite Lived Intangible Assets By Major Class [Line Items] | ||
Gross Carrying Amount | 17,690 | 17,690 |
Accumulated Amortization | 3,059 | 1,973 |
Net Carrying Amount | 14,631 | 15,717 |
Other Intangibles | ||
Indefinite Lived Intangible Assets By Major Class [Line Items] | ||
Gross Carrying Amount | 30 | 30 |
Accumulated Amortization | 23 | 16 |
Net Carrying Amount | $ 7 | $ 14 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Schedule of Expected Future Amortization Expense (Details) $ in Thousands | Sep. 30, 2023 USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2023 (Remaining) | $ 505 |
2024 | 1,965 |
2025 | 1,924 |
2026 | 1,924 |
2027 | $ 1,924 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments - Summary of Significant Financial Assets and Liabilities Measured at Fair Value (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Financial Assets: | ||
Interest rate swap | $ 2,024 | |
Financial Liabilities: | ||
Contingent consideration | 1,770 | $ 3,640 |
Level 2 [Member] | ||
Financial Assets: | ||
Interest rate swap | 2,024 | |
Level 3 [Member] | ||
Financial Liabilities: | ||
Contingent consideration | $ 1,770 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments - Schedule of Reconciliation of Level 3 Earn-Out Liabilities (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Jan. 10, 2022 | Sep. 30, 2023 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Beginning Balance | $ 3,640 | |
Achieved milestones reclassified to accrued expenses | (2,500) | |
Change in fair value of earn-out liabilities | 630 | |
Ending Balance | $ 1,770 | |
Disior LTD. | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Acquisition date fair value of earn-out liabilities | $ 6,550 |
Fair Value of Financial Instr_5
Fair Value of Financial Instruments - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2023 | Jun. 30, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||||
Interest rate swap | $ 2,024 | $ 2,024 | |||
Contingent earn-out liability, current | 1,444 | 1,444 | |||
Contingent earn-out liability, Non current | 326 | 326 | |||
Net increase (decrease) in estimate of earn-out liabilities | 310 | 630 | |||
Achieved milestones reclassified to accrued expenses | 2,500 | ||||
Achieved milestones reclassified to accrual restricted cash | 1,000 | ||||
Payments on earnout liability in cash | 5,500 | $ 500 | |||
Disior LTD. | |||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||||
Payments on earnout liability in cash | 5,000 | ||||
Additive Orthopaedics, LLC | |||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||||
Payments on earnout liability in cash | 500 | ||||
Level 2 [Member] | |||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||||
Interest rate swap | 2,024 | 2,024 | |||
Accrued Expenses | Disior LTD. | |||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||||
Achieved milestones reclassified to accrued expenses | $ 5,000 | ||||
Accrued Expenses | Disior LTD. | Fourth Project Milestone | |||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||||
Achieved milestones reclassified to accrued expenses | $ 2,000 | ||||
Accrued Expenses | Additive Orthopaedics, LLC | |||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||||
Achieved milestones reclassified to accrued expenses | $ 500 | $ 1,000 | $ 1,500 |
Debt - Schedule of Long-term De
Debt - Schedule of Long-term Debt Instruments (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | ||
Debt, gross amount | $ 45,093 | $ 45,659 |
Less: deferred issuance costs | (2,165) | (2,749) |
Total debt, net of issuance costs | 42,928 | 42,910 |
Less: current portion | (640) | (728) |
Long-term debt net, less current maturities | 42,288 | 42,182 |
MidCap Term Loan | ||
Debt Instrument [Line Items] | ||
Debt, gross amount | 30,000 | 30,000 |
Zions Term Loan Facility [Member] | ||
Debt Instrument [Line Items] | ||
Debt, gross amount | 15,093 | 15,573 |
Bank of Ireland Note Payable | ||
Debt Instrument [Line Items] | ||
Debt, gross amount | $ 0 | $ 86 |
Debt - MidCap Credit Agreements
Debt - MidCap Credit Agreements - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||||
Nov. 09, 2022 | May 06, 2021 | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Debt Instrument [Line Items] | |||||||
Debt, gross amount | $ 45,093,000 | $ 45,093,000 | $ 45,659,000 | ||||
MidCap Credit Agreements | |||||||
Debt Instrument [Line Items] | |||||||
Debt, gross amount | $ 70,000,000 | ||||||
Debt issuance cost before amortization | 1,942,000 | 1,942,000 | |||||
MidCap Credit Agreements | Interest Expense | |||||||
Debt Instrument [Line Items] | |||||||
Amortization expense | $ 183,000 | $ 165,000 | $ 552,000 | $ 409,000 | |||
MidCap Credit Agreements | Term Loan | |||||||
Debt Instrument [Line Items] | |||||||
Debt, gross amount | $ 40,000,000 | ||||||
MidCap Credit Agreements | Term Loan | SOFR | |||||||
Debt Instrument [Line Items] | |||||||
Variable interest rate | 6% | ||||||
MidCap Credit Agreements | Term Loan | LIBOR | |||||||
Debt Instrument [Line Items] | |||||||
Variable interest rate | 6% | ||||||
MidCap Credit Agreements | Term Loan, First Commitment | |||||||
Debt Instrument [Line Items] | |||||||
Debt, gross amount | $ 10,000,000 | ||||||
MidCap Credit Agreements | Term Loan, Second Commitment | |||||||
Debt Instrument [Line Items] | |||||||
Debt, gross amount | 30,000,000 | ||||||
MidCap Credit Agreements | Revolving Loan | |||||||
Debt Instrument [Line Items] | |||||||
Total borrowing capacity | $ 50,000,000 | $ 30,000,000 | |||||
Expiration date | May 01, 2026 | ||||||
MidCap Credit Agreements | Revolving Loan | SOFR | |||||||
Debt Instrument [Line Items] | |||||||
Variable interest rate | 3.75% | ||||||
MidCap Credit Agreements | Revolving Loan | LIBOR | |||||||
Debt Instrument [Line Items] | |||||||
Variable interest rate | 3% | 3% |
Debt - Zions Term Loan Facility
Debt - Zions Term Loan Facility - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||||
Nov. 10, 2022 | Mar. 24, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Line Of Credit Facility [Line Items] | |||||||
Total debt issuance costs | $ 2,165,000 | $ 2,165,000 | $ 2,749,000 | ||||
Secured Term Loan Facility | |||||||
Line Of Credit Facility [Line Items] | |||||||
Principal amount | $ 16,000,000 | ||||||
Maturity date | Mar. 24, 2037 | ||||||
Debt, frequency of payment | monthly | ||||||
Threshold amount of operating cash flow to calculate liquidity ratio | $ 0 | ||||||
Threshold Amount of Operating Cash Flow to Calculate Fixed Charge Coverage Ratio | $ 0 | ||||||
Amortization of debt issuance costs | 4,000 | $ 4,000 | 12,000 | $ 9,000 | |||
Secured Term Loan Facility | SOFR | |||||||
Line Of Credit Facility [Line Items] | |||||||
Variable interest rate | 1.75% | ||||||
Zions Facility [Member] | |||||||
Line Of Credit Facility [Line Items] | |||||||
Total debt issuance costs | $ 223,000 | $ 223,000 | |||||
Zions Facility [Member] | Secured Term Loan Facility | Interest Rate Swap [Member] | SOFR | |||||||
Line Of Credit Facility [Line Items] | |||||||
Interest rate | 4.25% |
Stockholders Equity - Additiona
Stockholders Equity - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 9 Months Ended | ||||
Jan. 30, 2023 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | Oct. 08, 2021 | |
Class of Stock [Line Items] | |||||
Options reserved for future grant | 310,000,000 | ||||
Common stock share authorized | 300,000,000 | 300,000,000 | 300,000,000 | ||
Common stock par value | $ 0.01 | $ 0.01 | $ 0.01 | ||
Convertible preferred stock, authorized | 10,000,000 | ||||
Convertible preferred stock, par value | $ 0.01 | ||||
Net proceeds after deducting underwriting discounts and commissions | $ 68,453 | $ 68,453 | |||
Treasury stock repurchase shares | 0 | 0 | |||
Common Stock | |||||
Class of Stock [Line Items] | |||||
Number of aggregate issued | 6,500,000 | 4,312,500 | |||
Price per share | $ 17 | ||||
Shares sold by Company | Common Stock | |||||
Class of Stock [Line Items] | |||||
Number of shares issued and sold | 3,750,000 | ||||
Selling securityholders | |||||
Class of Stock [Line Items] | |||||
Net proceeds after deducting underwriting discounts and commissions | $ 50,700 | ||||
Selling securityholders | Common Stock | |||||
Class of Stock [Line Items] | |||||
Number of shares issued and sold | 2,750,000 | ||||
Underwriters Option to Purchase Additional Shares | Maximum | |||||
Class of Stock [Line Items] | |||||
Number of shares issued and sold | 562,500 | ||||
Underwriters Option to Purchase Additional Shares | Common Stock | |||||
Class of Stock [Line Items] | |||||
Number of shares issued and sold | 412,500 |
Loss Per Share - Summary of Com
Loss Per Share - Summary of Computation of Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Net loss attributable to common stockholders | ||||
Net loss | $ (8,332) | $ (9,724) | $ (28,282) | $ (28,563) |
Weighted-average common stock outstanding: | ||||
Basic | 82,548,892 | 76,850,949 | 81,878,814 | 76,595,118 |
Diluted | 82,548,892 | 76,850,949 | 81,878,814 | 76,595,118 |
Loss per share, Basic: | ||||
Basic | $ (0.1) | $ (0.13) | $ (0.35) | $ (0.37) |
Loss per share, Diluted: | ||||
Diluted | $ (0.1) | $ (0.13) | $ (0.35) | $ (0.37) |
Loss Per Share - Summary of Pot
Loss Per Share - Summary of Potentially Dilutive Securities Excluded from Calculation of Diluted Net Loss Per Share Attributable to Common Stockholders (Details) - shares | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Employee Stock Option | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potentially dilutive securities excluded from computation of dilutive net loss per share | 6,119,477 | 7,304,770 |
Restricted Stock Units | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potentially dilutive securities excluded from computation of dilutive net loss per share | 1,392,087 | 144,547 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Employee Stock Option | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Compensation expense | $ 1,724 | $ 2,254 | $ 5,320 | $ 6,351 |
Restricted Stock Units | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Compensation expense | $ 1,788 | 332 | $ 4,974 | $ 701 |
Employee Stock Purchase Plan | ||||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||||
Market price of shares authorized percentage | 85% | 85% | ||
Employee contribution percentage | 15% | |||
Maximum purchase value of shares available for each employee | $ 25,000 | |||
Shares issued | 37,146 | 17,060 | ||
Compensation expense | $ 86 | $ 100 | $ 268 | $ 100 |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of Stock Option Activity (Details) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2023 $ / shares shares | Dec. 31, 2022 $ / shares shares | |
Share-Based Payment Arrangement [Abstract] | ||
Shares Outstanding, Beginning Balance | shares | 6,538,536 | |
Shares, Granted | shares | 225,000 | |
Shares, Exercised or released | shares | (379,705) | |
Shares, Forfeited or Expired | shares | (264,354) | |
Shares Outstanding, Ending Balance | shares | 6,119,477 | 6,538,536 |
Shares, Exercisable | shares | 4,232,008 | |
Shares, Vested and Expected To Vest | shares | 6,112,107 | |
Weighted-Average Exercise Price, Beginning Balance | $ / shares | $ 10.02 | |
Weighted-Average Exercise Price, Granted | $ / shares | 18.33 | |
Weighted-Average Exercise Price, Exercised or released | $ / shares | 6.68 | |
Weighted-Average Exercise Price, Forfeited or Expired | $ / shares | 14.8 | |
Weighted-Average Exercise Price, Ending Balance | $ / shares | 10.32 | $ 10.02 |
Weighted-Average Exercise Price, Exercisable | $ / shares | 8.22 | |
Weighted-Average Exercise Price, Vested and Expected To Vest | $ / shares | $ 10.31 | |
Weighted-Average Remaining Contractual Term (Years) | 6 years 10 months 20 days | 7 years 4 months 9 days |
Weighted-Average Remaining Contractual Term (Years), Exercisable | 6 years 4 months 2 days | |
Weighted-Average Remaining Contractual Term (Years), Vested and expected to vest | 6 years 10 months 20 days |
Stock Based Compensation - Summ
Stock Based Compensation - Summary of Restricted Stock Units (Details) - Restricted Stock Units | 9 Months Ended |
Sep. 30, 2023 $ / shares shares | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Outstanding, Beginning balance | shares | 964,054 |
Granted | shares | 630,618 |
Vested | shares | (55,968) |
Forfeited or expired | shares | (146,617) |
Outstanding, Ending balance | shares | 1,392,087 |
Vested and expected to vest | shares | 1,378,740 |
Weighted Average Fair Value, Beginning Balance | $ / shares | $ 17.74 |
Weighted Average Fair Value, Granted | $ / shares | 17.82 |
Weighted Average Fair Value, Vested | $ / shares | 16.97 |
Weighted Average Fair Value, Forfeited or expired | $ / shares | 17.81 |
Weighted Average Fair Value, Ending Balance | $ / shares | 17.8 |
Weighted Average Fair Value, Vested and expected to vest | $ / shares | $ 17.8 |
Income Taxes - Schedule of Effe
Income Taxes - Schedule of Effective Tax Rates (Details) | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | ||
Effective tax rate | (0.322%) | (1.057%) |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | ||||
Income tax (benefit) expense | $ (108) | $ 201 | $ 90 | $ 306 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Related Party Transaction [Line Items] | |||||
Payments to related party | $ 10,394 | $ 8,491 | $ 28,158 | $ 22,920 | |
Due to related parties | 1,893 | 1,893 | $ 3,844 | ||
Selling, general and administrative expenses from transactions with related party | $ 44,126 | 39,667 | $ 131,773 | 114,857 | |
Director | License Agreement | |||||
Related Party Transaction [Line Items] | |||||
Percentage of revenue paid as royalty | 4% | ||||
Royalty estimated useful life | 15 years | 15 years | |||
Related party transaction term of agreement | 20 years | ||||
Related party transaction, agreement renewal term | 5 years | ||||
Director | Related Party | License Agreement | |||||
Related Party Transaction [Line Items] | |||||
Due to related parties | $ 66 | $ 66 | 0 | ||
Payments to related party | 32 | 28 | 233 | 221 | |
Due to related parties | 128 | 128 | $ 164 | ||
Selling, general and administrative expenses from transactions with related party | 123 | $ 0 | 238 | $ 266 | |
Annual Payment Threshold | Minimum | Director | Related Party | License Agreement | |||||
Related Party Transaction [Line Items] | |||||
Due to related parties | $ 250 | $ 250 |
Segment and Geographic Inform_3
Segment and Geographic Information - Additional Information (Details) - Country | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
International | ||||
Segment Reporting Information [Line Items] | ||||
Number of countries accounted more than ten percent of net revenue | 0 | 0 | 0 | 0 |
Segment and Geographic Inform_4
Segment and Geographic Information - Schedule of Total Net Revenue by Geographic Area (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Segment Reporting Information [Line Items] | ||||
Total net revenue | $ 52,783 | $ 46,006 | $ 155,828 | $ 129,875 |
United States | ||||
Segment Reporting Information [Line Items] | ||||
Total net revenue | 44,548 | 39,960 | 131,793 | 112,781 |
International | ||||
Segment Reporting Information [Line Items] | ||||
Total net revenue | $ 8,235 | $ 6,046 | $ 24,035 | $ 17,094 |
Segment and Geographic Inform_5
Segment and Geographic Information - Schedule of Total Non-current Assets, Excluding Deferred Taxes, by Geographic Area (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Segment Reporting Information [Line Items] | ||
Total assets | $ 124,431 | $ 111,585 |
United States | ||
Segment Reporting Information [Line Items] | ||
Total assets | 90,373 | 79,458 |
Finland | ||
Segment Reporting Information [Line Items] | ||
Total assets | 25,170 | 25,581 |
Other International | ||
Segment Reporting Information [Line Items] | ||
Total assets | $ 8,888 | $ 6,546 |
Subsequent Events - Additional
Subsequent Events - Additional Information (Details) - Subsequent Event - Ares Credit Agreements | Nov. 02, 2023 USD ($) |
Subsequent Event [Line Items] | |
indebtedness principal or stated amount | $ 12,500,000 |
Expiration date | Nov. 02, 2028 |
Ares Term Loan | |
Subsequent Event [Line Items] | |
Total borrowing capacity | $ 100,000,000 |
Drew down value | $ 75,000,000 |
Ares Term Loan | SOFR | |
Subsequent Event [Line Items] | |
Variable interest rate | 6.75% |
Revolving Loan | Secured Debt | |
Subsequent Event [Line Items] | |
Total borrowing capacity | $ 150,000,000 |
Ares Revolving Loan | |
Subsequent Event [Line Items] | |
Drew down value | $ 25,000,000 |
Ares Revolving Loan | SOFR | |
Subsequent Event [Line Items] | |
Variable interest rate | 4% |
Maximum | Ares Revolving Loan | |
Subsequent Event [Line Items] | |
Total borrowing capacity | $ 50,000,000 |