Document and Entity Information
Document and Entity Information - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Feb. 23, 2024 | Jun. 30, 2023 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2023 | ||
Document Fiscal Year Focus | 2023 | ||
Document Fiscal Period Focus | FY | ||
Document Transition Report | false | ||
Entity File Number | 001-40902 | ||
Entity Registrant Name | Paragon 28, Inc. | ||
Entity Central Index Key | 0001531978 | ||
Amendment Flag | false | ||
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 Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Document Financial Statement Error Correction | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 830.7 | ||
Entity Common Stock, Shares Outstanding | 82,837,092 | ||
Documents Incorporated by Reference | DOCUMENTS INCORPORATED BY REFERENCE The Registrant intends to file a definitive proxy statement pursuant to Regulation 14A within 120 days of the end of the fiscal year ended December 31, 2023 . Portions of such definitive proxy statement are incorporated by reference into Part III of this Annual Report on Form 10-K. | ||
Auditor Firm ID | 34 | ||
Auditor Name | Deloitte & Touche LLP | ||
Auditor Location | Denver, Colorado |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash | $ 75,639 | $ 38,468 |
Trade receivables | 37,323 | 37,687 |
Inventories, net | 98,062 | 60,948 |
Income taxes receivable | 794 | 615 |
Other current assets | 3,997 | 4,658 |
Total current assets | 215,815 | 142,376 |
Property and equipment, net | 74,122 | 61,938 |
Intangible assets, net | 21,674 | 22,387 |
Goodwill | 25,465 | 25,465 |
Deferred income taxes | 705 | 148 |
Other assets | 2,918 | 1,795 |
Total assets | 340,699 | 254,109 |
Current liabilities: | ||
Accounts payable | 21,696 | 14,939 |
Accrued expenses | 27,781 | 26,807 |
Accrued legal settlement | 22,000 | |
Other current liabilities | 883 | 3,844 |
Current maturities of long-term debt | 640 | 728 |
Income taxes payable | 243 | 184 |
Total current liabilities | 51,243 | 68,502 |
Long-term liabilities: | ||
Long-term debt net, less current maturities | 109,799 | 42,182 |
Other long-term liabilities | 1,048 | 1,628 |
Deferred income taxes | 233 | 342 |
Income taxes payable | 635 | 527 |
Total liabilities | 162,958 | 113,181 |
Commitments and contingencies (Note 14) | ||
Stockholders' equity: | ||
Common stock, $0.01 par value, 300,000,000 shares authorized; 83,738,974 and 78,684,107 shares issued, and 82,825,455 and 77,770,588 shares outstanding as of December 31, 2023 and December 31, 2022, respectively | 827 | 776 |
Additional paid in capital | 298,394 | 213,956 |
Accumulated deficit | (115,630) | (67,789) |
Accumulated other comprehensive income (loss) | 132 | (33) |
Treasury stock, at cost; 913,519 shares as of December 31, 2023 and December 31, 2022 | (5,982) | (5,982) |
Total stockholders' equity | 177,741 | 140,928 |
Total liabilities & stockholders' equity | $ 340,699 | $ 254,109 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 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 | 83,738,974 | 78,684,107 |
Common stock shares, outstanding | 82,825,455 | 77,770,588 |
Treasury stock share issued | 913,519 | 913,519 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Net revenue | $ 216,389 | $ 181,383 | $ 147,464 |
Cost of goods sold | 43,598 | 32,457 | 28,024 |
Gross profit | 172,791 | 148,926 | 119,440 |
Operating expenses | |||
Research and development costs | 30,078 | 24,650 | 16,128 |
Selling, general, and administrative | 180,022 | 159,323 | 114,087 |
Legal settlement | 27,000 | ||
Total operating expenses | 210,100 | 210,973 | 130,215 |
Operating loss | (37,309) | (62,047) | (10,775) |
Other income (expense): | |||
Other income (expense) | 154 | (1,214) | (486) |
Loss on early extinguishment of debt | (5,308) | ||
Interest expense, net | (5,165) | (4,129) | (1,719) |
Total other expense | (10,319) | (5,343) | (2,205) |
Loss before income taxes | (47,628) | (67,390) | (12,980) |
Income tax expense (benefit) | 213 | (64) | 713 |
Net loss | (47,841) | (67,326) | (13,693) |
Foreign currency translation adjustment | 165 | (41) | (815) |
Comprehensive loss | $ (47,676) | $ (67,367) | $ (14,508) |
Weighted average number of shares of common stock outstanding: | |||
Basic | 82,087,329 | 76,766,100 | 52,916,711 |
Diluted | 82,087,329 | 76,766,100 | 52,916,711 |
Net loss per share attributable to common stockholders: | |||
Basic | $ (0.58) | $ (0.88) | $ (0.26) |
Diluted | $ (0.58) | $ (0.88) | $ (0.26) |
CONSOLIDATED STATEMENTS OF CONV
CONSOLIDATED STATEMENTS OF CONVERTIBLE PREFERRED SERIES EQUITY & STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Initial Public Offering | Common Stock | Common Stock Initial Public Offering | Preferred Stock Series A Convertible Preferred Stock | Preferred Stock Series B Convertible Preferred Stock | Additional Paid-in-Capital | Additional Paid-in-Capital Initial Public Offering | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) | Treasury stock |
Temporary equity, beginning balance, shares at Dec. 31, 2020 | 13,812,500 | 6,608,700 | |||||||||
Temporary equity, beginning balance at Dec. 31, 2020 | $ 4,250 | $ 36,842 | |||||||||
Beginning balance, shares at Dec. 31, 2020 | 46,738,540 | ||||||||||
Beginning balance at Dec. 31, 2020 | $ 30,393 | $ 467 | $ 22,107 | $ 12,418 | $ 823 | $ (5,422) | |||||
Net loss | (13,693) | (13,693) | |||||||||
Issuance of common stock, shares | 151,515 | 8,984,375 | |||||||||
Issuance of common stock | 1,001 | $ 129,384 | $ 1 | $ 90 | 1,000 | $ 129,294 | |||||
Common stock repurchase, shares | (85,049) | ||||||||||
Common stock repurchase | (561) | $ (1) | (560) | ||||||||
Temporary equity, Conversion of Series A and Series B preferred stock to common stock, Shares | (13,812,500) | (6,608,700) | |||||||||
Temporary equity, Conversion of Series A and Series B preferred stock to common stock, Value | $ (4,250) | $ (36,842) | |||||||||
Conversion of Series A and Series B preferred stock to common stock, Shares | 20,421,200 | ||||||||||
Conversion of Series A and Series B preferred stock to common stock, Value | 41,092 | $ 204 | 40,076 | 812 | |||||||
Options exercised, shares | 236,706 | ||||||||||
Options exercised | 445 | $ 2 | 443 | ||||||||
Foreign currency translation | (815) | (815) | |||||||||
Stock-based compensation | 4,948 | 4,948 | |||||||||
Ending balance, shares at Dec. 31, 2021 | 76,447,287 | ||||||||||
Ending balance at Dec. 31, 2021 | 192,194 | $ 763 | 197,868 | (463) | 8 | (5,982) | |||||
Net loss | (67,326) | (67,326) | |||||||||
Issuance of common stock, shares | 0 | ||||||||||
Offering costs associated with initial public offering | (266) | (266) | |||||||||
Options exercised, shares | 1,284,333 | ||||||||||
Options exercised | 5,271 | $ 13 | 5,258 | ||||||||
Foreign currency translation | (41) | (41) | |||||||||
Employee stock purchase plan | 731 | 731 | |||||||||
Employee stock purchase plan,Shares | 38,968 | ||||||||||
Stock-based compensation | 10,365 | 10,365 | |||||||||
Ending balance, shares at Dec. 31, 2022 | 77,770,588 | ||||||||||
Ending balance at Dec. 31, 2022 | 140,928 | $ 776 | 213,956 | (67,789) | (33) | (5,982) | |||||
Net loss | (47,841) | (47,841) | |||||||||
Issuance of common stock, shares | 4,312,500 | ||||||||||
Issuance of common stock | 68,453 | $ 43 | 68,410 | ||||||||
Options exercised, shares | 668,925 | ||||||||||
Options exercised | 2,406 | $ 7 | 2,399 | ||||||||
Foreign currency translation | 165 | 165 | |||||||||
Employee stock purchase plan | 1,266 | $ 1 | 1,265 | ||||||||
Employee stock purchase plan,Shares | 73,442 | ||||||||||
Stock-based compensation | 12,364 | 12,364 | |||||||||
Ending balance, shares at Dec. 31, 2023 | 82,825,455 | ||||||||||
Ending balance at Dec. 31, 2023 | $ 177,741 | $ 827 | $ 298,394 | $ (115,630) | $ 132 | $ (5,982) |
CONSOLIDATED STATEMENTS OF CO_2
CONSOLIDATED STATEMENTS OF CONVERTIBLE PREFERRED SERIES EQUITY & STOCKHOLDERS' EQUITY (Parenthetical) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |
Jul. 31, 2020 | Dec. 31, 2023 | Dec. 31, 2021 | |
Issuance costs | $ 827 | ||
IPO | |||
Issuance costs | $ 4,304 | ||
Series B Convertible Preferred Stock | |||
Issuance costs | $ 1,970 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Cash flows from operating activities | |||
Net loss | $ (47,841) | $ (67,326) | $ (13,693) |
Adjustments to reconcile net loss to net cash provided by operating activities: | |||
Depreciation and amortization | 15,542 | 13,728 | 8,961 |
Allowance for doubtful accounts | 614 | 155 | 1,022 |
Excess and obsolete inventories | (352) | 485 | 2,821 |
Loss on early extinguishment of debt | 1,881 | ||
Stock-based compensation | 12,364 | 10,365 | 4,948 |
Change in fair value | (791) | 1,280 | 440 |
Other | 984 | 704 | 1,014 |
Changes in other assets and liabilities, net of acquisitions: | |||
Accounts receivable | (161) | (12,013) | (6,461) |
Inventories | (36,595) | (21,512) | (11,098) |
Accounts payable | 6,742 | 1,895 | 3,431 |
Accrued expenses | 6,428 | 2,317 | 7,095 |
Accrued legal settlement | (22,000) | 22,000 | |
Income tax receivable/payable | (50) | 391 | 671 |
Other assets and liabilities | (655) | (1,650) | (2,468) |
Net cash used in operating activities | (63,890) | (49,181) | (3,317) |
Cash flows from investing activities | |||
Purchase of office building | (18,300) | ||
Purchases of property and equipment | (26,716) | (22,813) | (18,296) |
Proceeds from sale of property and equipment | 1,043 | 897 | 799 |
Purchases of intangible assets | (1,314) | (1,973) | (2,993) |
Acquisitions, net of cash received | (18,504) | (15,000) | |
Net cash used in investing activities | (26,987) | (60,693) | (35,490) |
Cash flows from financing activities | |||
Proceeds from draw on term loan | 20,000 | ||
Proceeds from issuance of long-term debt | 100,000 | 16,000 | 10,000 |
Payments on long-term debt | (30,727) | (570) | (6,034) |
Payments of debt issuance costs | (4,423) | (732) | (3,139) |
Proceeds from issuance of common stock, net of issuance costs | 68,453 | 1,001 | |
Proceeds from IPO, net of issuance costs | 129,384 | ||
Payments on treasury stock repurchased | (561) | ||
Proceeds from exercise of stock options | 2,406 | 5,271 | 445 |
Proceeds from employee stock purchase plan | 944 | 518 | |
Payments on earnout liability | (8,000) | (1,000) | |
Net cash provided by financing activities | 128,653 | 39,487 | 131,096 |
Effect of exchange rate changes on cash | (605) | (497) | (438) |
Net increase (decrease) in cash | 37,171 | (70,884) | 91,851 |
Cash at beginning of period | 38,468 | 109,352 | 17,501 |
Cash at end of period | 75,639 | 38,468 | 109,352 |
Supplemental disclosures of cash flow information: | |||
Restricted cash (Note 7) | 1,000 | ||
Cash paid for income taxes | 908 | 1,103 | 678 |
Cash paid for interest | 4,271 | 3,073 | 1,086 |
Purchase of property and equipment included in accounts payable | $ 3,402 | $ 3,402 | $ 881 |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Pay vs Performance Disclosure | |||
Net Income (Loss) | $ (47,841) | $ (67,326) | $ (13,693) |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended | 12 Months Ended |
Dec. 31, 2023 | Dec. 31, 2023 | |
Trading Arrangements, by Individual | ||
Material Terms of Trading Arrangement | During the three months ended December 31, 2023, no director or officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K. | |
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 | 12 Months Ended |
Dec. 31, 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, 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. Initial Public Offering In October 2021, the Company completed its initial public offering (“IPO”), in which it issued and sold 8,984,375 shares of its common stock at the public offering price of $ 16.00 per share, including 1,171,875 shares of its common stock upon the exercise of the underwriters’ option to purchase additional shares. The Company received net proceeds after deducting underwriting discounts and commissions o f $ 133,688 . The Company incurred $ 4,304 of offering expenses that were offset against proceeds for the year ended December 31, 2021. In connection with the IPO, all of the shares of the Company’s outstanding convertible preferred stock automatically converted into an aggregate of 20,421,200 shares of the common stock. Secondary Public Offering 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 approximately $ 68,453 after deducting underwriting discounts and commissions and offering expenses payable by the Company. The selling securityholders received aggregate net proceeds from the Offering of approximately $ 50,700 after deducting underwriting discounts and commissions. The Company did not receive any of the proceeds from the sale of shares of Common Stock by the selling securityholders. Basis of Presentation and Consolidation The accompanying Consolidated Financial Statements include the accounts of Paragon 28, Inc. and its subsidiaries, all of which are wholly-owned. All intercompany balances and transactions have been eliminated in consolidation. The accompanying Consolidated Financial Statements have been prepared in conformity with accounting principles generally accepted in the U.S. (“U.S. GAAP”). |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 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 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 liability, income taxes and stock-based compensation. Foreign Currency Translation The 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 year-end exchange rates, while revenue and expenses are translated at average exchange rates during the year 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. Business Combinations We allocate the purchase consideration to the identifiable net assets acquired, including intangible assets and liabilities assumed, 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, is recorded as goodwill. During the measurement period, which is up to one year from the acquisition date, we may adjust provisional amounts that were recognized at the acquisition date to reflect new information obtained about facts and circumstances that existed as of the acquisition date. Determining the fair value of assets acquired and liabilities assumed requires significant judgment, including the selection of valuation methodologies including the income approach, the cost approach, and the market approach. Significant assumptions used in those methodologies include, but are not limited to, the expected values of the underlying metric, the systematic risk embedded in the underlying metric, the volatility of the underlying metric, the risk-free rate, and the counterparty risk. The use of different valuation methodologies and assumptions is highly subjective and inherently uncertain and, as a result, actual results may differ materially from estimates. Cash Cash consists of highly liquid investments with an original maturity of three months or less. As of December 31, 2023, $ 1,000 related to the achievement of an Additive Orthopaedics acquisition milestone was included as restricted cash within the Consolidated Balance Sheets and Consolidated Statement of Cash Flows. For additional information regarding the Additive Orthopaedics acquisition refer to Note 3 to our Consolidated Financial Statements. There were no contractual or other restrictions as to the use of cash for the years ended December 31, 2022 or 2021. Trade Receivables, Less Allowance for Doubtful Accounts Trade receivables due from customers are uncollateralized customer obligations due under normal trade terms requiring payment within 30 days from the invoice date and are stated at the amount billed to the customer. Trade receivables also include unbilled receivables due from customers that represent completed surgical cases that are pending customer-issued purchase orders. These unbilled receivables are covered by agreements with customers, the products have typically been used in a surgery, and collection is determined to be probable. The Company estimates an allowance for doubtful accounts based upon an evaluation of the current status of receivables, historical experience, and other factors as necessary. It is reasonably possible that the Company’s estimate of the allowance for doubtful accounts will change. The following table presents the activity in the allowance for doubtful accounts for the years ended December 31, 2023 and 2022. December 31, 2023 2022 Allowance for doubtful accounts, beginning of year $ 1,688 $ 1,032 Additions charged against revenue or to expense 223 1,853 Write-offs ( 572 ) ( 1,197 ) Allowance for doubtful accounts, end of year $ 1,339 $ 1,688 Inventories, Net Inventories are considered finished goods and are purchased from third party contract manufacturers. These inventories consist of implants, hardware, and consumables and are held in our warehouse, with third-party independent sales representatives or distributors, or consigned directly with hospitals. Inventories are stated at the lower of cost (weighted average cost basis) or net realizable value. When sold, inventory is relieved at weighted average cost. We evaluate the carrying value of our inventories in relation to historical sales, current inventory levels, and consideration of the life cycle of the product. A significant decrease in demand or development of products could result in an increase in the amount of excess inventory on hand, which could lead to additional charges for excess and obsolete inventory. The Company estimates a reserve for obsolete and slow-moving inventory based on current inventory levels and historical sales. (Income ) expenses for excess and obsolete inventory are included in Cost of goods sold. The inventory reserve was $ 16,532 and $ 16,804 as of December 31, 2023 and 2022, respectively. The need to maintain substantial levels of inventory impacts our estimates for excess and obsolete inventory. Each of our implant systems are designed to include implantable products that come in different sizes and shapes to accommodate the surgeon’s needs related to the patient’s anatomical size. Typically, a small number of the set components are used in each surgical procedure. Certain components within each set may become obsolete before other components based on the usage patterns. We adjust inventory values, as needed, to reflect these usage patterns and life cycle. Property and Equipment, Net Property and equipment are recorded at cost less accumulated depreciation. Expenditures for renewals and improvements that significantly add to the productive capacity or extend the useful life of an asset are capitalized and included in Property and equipment, net in the Consolidated Balance Sheets. Expenditures for maintenance and repairs are charged to expense as incurred and are included in Selling, general, and administrative expense in the Consolidated Statements of Operations and Comprehensive Loss. When equipment is retired or sold, the cost and related accumulated depreciation are eliminated from the accounts and the resulting gain or loss is included in included in Selling, general and administrative in the Consolidated Statements of Operations and Comprehensive Loss. Depreciation is provided using the straight-line method based on useful lives of the assets which range from three to twenty-five years , which best reflects the pattern of use. The Company depreciates surgical instrumentation, once available for use, over a five-year period and cases, once available for use, over a three-year period. Depreciation for surgical instrumentation used in surgery is included in Selling, general, and administrative expense in the Consolidated Statements of Operations and Comprehensive Loss. Leasehold improvements are amortized using the straight-line method over the shorter of the asset’s useful life or the lease term. Property and equipment are assessed for impairment upon triggering events that indicate that the carrying value of an asset group may not be recoverable. Recoverability is measured by a comparison of the carrying amount to future net undiscounted cash flows of the asset group expected to be generated from its use and eventual disposition. If the asset group’s carrying value is determined to not be recoverable, the impairment to be recognized is measured by which the carrying amount exceeds the fair value of the asset group. No impairment charges related to property and equipment were recorded in any of the periods presented. Intangibles The costs associated with applying for patents and trademarks are capitalized. Patents are amortized on a straight-line basis over the lesser of the patent’s economic or legal life, which is seventeen years . Costs associated with capitalized patents include third-party attorney fees and other third-party fees as well as costs related to the following: the preparation of patent applications, government filings and registration fees, drawings, computer searches, and translations related to specific patents. Trademarks that are anticipated to be renewed every ten years have an indefinite life and are not amortized but tested for impairment annually. Once it is determined a trademark will no longer be renewed, the trademark is amortized over the remainder of the trademark’s registration period. Customer relationships are amortized over an estimated useful life of three to seven years on a straight-line basis. Other intangibles, which mainly consist of noncompete arrangements, are amortized over an estimated useful life of three years on a straight-line basis. Developed technology is amortized over an estimated useful life of twelve years on a straight-line basis. Amortizable intangible assets are assessed for impairment upon triggering events that indicate that the carrying value of an asset may not be recoverable. Recoverability is measured by a comparison of the carrying amount to future net undiscounted cash flows expected to be generated by the associated asset. If the asset’s carrying value is determined to not be recoverable, the impairment to be recognized is measured by the amount by which the carrying amount exceeds the fair market value of the intangible assets. No impairment charges related to amortizable assets were recorded for the years ended December 31, 2023, 2022 and 2021. Indefinite-lived trademark assets are reviewed for impairment annually or whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. The Company can elect to first apply the optional qualitative impairment assessment to determine whether the indefinite-lived intangible asset is more-likely-than-not impaired. If, on the basis of the qualitative impairment assessment, an entity asserts that it is more likely than not that the indefinite-lived intangible asset is impaired, the Company would be required to calculate the fair value of the asset for an impairment test. Impairment loss is recognized if the carrying amount of the asset exceeds its fair value. A qualitative assessment considers macroeconomic and other industry-specific factors, such as trends in short-term and long-term interest rates and the ability to access capital, and company specific factors such as trends in revenue generating activities, and merger or acquisition activity. If the Company elects to bypass qualitatively assessing its indefinite-lived intangible assets, or it is not more likely than not that the fair value of the intangible asset exceeds its carrying value, management estimates the fair value of the intangible asset and compares it to the carrying value. The estimated fair value of the intangible asset is established using an income approach based on a discounted cash flow model that includes significant assumptions about the future operating results and cash flows of the intangible asset or assets. The Company elected to perform a qualitative analysis for its indefinite-lived intangible assets as of October 1, 2023, the annual test date. The Company determined, after performing the qualitative analysis that there was no evidence that it is more likely than not that the fair value of its intangible assets was less than the carrying amount. Therefore, it was not necessary to perform a quantitative impairment test. Goodwill Goodwill represents the excess of the purchase price as compared to the fair value of net assets acquired and liabilities assumed. Goodwill is not amortized, but is tested for impairment annually or when indications of impairment exist. Goodwill is tested at the reporting unit level as defined in ASC 350. Per this definition, a reporting unit is an operating segment or one level below an operating segment. The Company has determined one reporting unit for the purpose of goodwill impairment. We can elect to qualitatively assess goodwill for impairment if it is more likely than not that the fair value of a reporting unit exceeds its carrying value. Impairment exists when the carrying amount, including goodwill, of the reporting unit exceeds its fair value, resulting in an impairment charge for this excess (not t o exceed the carrying amount of the goodwill). The impairment, if determined, is recorded within Operating expenses in the Consolidated Statements of Operations and Comprehensive Loss in the period the determination is made. Fair Value of Financial Instruments Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. There is a three-tier fair value hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value: 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. Financial instruments (principally cash, trade receivables, accounts payable and accrued expenses) are carried at cost, which approximates fair value due to the short-term maturity of these instruments. The majority of our debt is carried at cost, which approximates fair value due to the variable interest rate associated with our debt. However, we are the fixed rate payor on an interest rate swap contract associated with the Company's Zions Facility, which is classified as Level 2. We reassess the fair value of our interest rate swap on a quarterly basis. The change in fair value is recorded in other (expense) income in the Consolidated Statements of Operations and Comprehensive Loss. The Company does not have any assets or liabilities presented in the Level 1 category as of December 31, 2023, and 2022, and there were no changes in level hierarchies during the years ended December 31, 2023, 2022 and 2021 . See "Contingent Earn-out Consideration" below for a discussion on our Level 3 inputs. Contingent Earn-out Consideration Business combinations may include contingent earn-out consideration as part of the purchase price under which the Company will make future payments to the seller upon the achievement of certain milestones. The fair value of the contingent earn-out consideration is estimated as of the acquisition date at the present value of the expected contingent payments and is subsequently remeasured at each balance sheet date. Two methodologies may be considered in the valuation: the scenario-based model (“SBM”) and Monte Carlo simulation. The SBM relies on multiple outcomes to estimate the likelihood of future payoff of the contingent consideration. The resulting earnout payoff is then probability-weighted and discounted at an appropriate risk adjusted rate in order to arrive at the present value of the expected earnout payment. The Monte Carlo simulation is used to value the non-linear contingent considerations based on projected financial metrics. Each trial of the Monte Carlo simulation draws a value from the assumed distribution for the underlying metric. The earnout payoff for each simulation trial is calculated based on that particular simulated path for the underlying metrics and then discounted to present value using the risk-free rate, adjusted for counterparty credit risk. The value of the earnout is estimated as the average value from all simulation trials. The fair value estimates use unobservable inputs that reflect our own assumptions as to the ability of the acquired business to meet the targeted benchmarks and discount rates used in the calculations. The unobservable inputs are defined in ASC Topic 820, “Fair Value Measurements and Disclosures,” as Level 3 inputs. We review the probabilities of achievement of the earnout milestones to determine impact on the fair value of the earnout consideration on a quarterly basis over the earn-out period. Actual results are compared to the estimates and probabilities of achievement used in our forecasts. Should actual results of the acquired business increase or decrease as compared to our estimates and assumptions, the estimated fair value of the contingent earn-out consideration liability will increase or decrease, up to the contractual limit, as applicable. Changes in the estimated fair value of the contingent earn-out consideration are recorded in other income (expense) in the Consolidated Statements of Operations and Comprehensive Loss and are reflected in the period in which they are identified. Changes in the estimated fair value of the contingent earn-out consideration may materially impact or cause volatility in our operating results. Income Taxes The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, the Company determines deferred tax assets and liabilities on the basis of the differences between the financial statement and tax bases of assets and liabilities by using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. The Company regularly reviews its deferred tax assets for recoverability and establishes a valuation allowance if it is more likely than not that some portion, or all, of a deferred tax asset will not be realized. The determination as to whether a deferred tax asset will be realized is made on a jurisdictional basis and is based on both positive and negative evidence. This evidence includes historic taxable income, projected future taxable income, the expected timing of the reversal of existing temporary differences and the implementation of tax planning strategies. The Company records uncertain tax positions in accordance with Accounting Standards Codification (“ASC”) Topic 740 on the basis of a two-step process in which (1) the Company determines whether it is more-likely-than-not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, the Company recognizes the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. The Company evaluates its tax positions that have been taken or are expected to be taken on income tax returns to determine if an accrual is necessary for uncertain tax positions. The Company will recognize interest and penalties as a component of income tax expense if incurred. Revenue Recognition We account for revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”). Revenue is generated primarily from the sale of our implants and disposables and, to a much lesser extent, from the sale of our surgical instrumentation. We sell our products through employee sales personnel, and independent sales representatives in the U.S. Outside the U.S. sales are through independent sales representatives and to stocking distributors. We have consignment agreements with certain distributors and hospitals. Our customers are primarily hospitals and surgery centers. Revenue is recorded, net of estimated discounts and other price concessions, when our performance obligation is satisfied which is when our customers take title of the product, and typically when the product is used in surgery. We generally have written contracts with our customers which incorporate pricing and our standard terms and conditions. Any discounts we offer are outlined in our customer agreements. As the discounts are known at the time of purchase, no estimates are required at the time of revenue recognition. Shipping and handling costs are recorded as cost of goods sold and amounts billed to customers for shipping and handling costs are recorded in revenue. We record as revenue any amounts billed to customers for shipping and handling costs and record as cost of goods sold the actual shipping costs incurred. We have elected to exclude from the measurement of the transaction price all taxes (e.g., sales, use, value-added) assessed by government authorities and collected from a customer. Therefore, revenue is recognized net of such taxes. We have elected to use the practical expedient allowed under ASC 606 to account for shipping and handling activities that occur after the customer has obtained control of a promised good as fulfillment costs rather than as an additional promised service and, therefore, we do not allocate a portion of the transaction price to a shipping service obligation. Commissions to sales agents for the sales exceeding their quotas are classified as incremental costs of obtaining a contract as such costs would not have been incurred if the contract was not signed. We have elected to use the practical expedient to expense such costs that should be capitalized as the amortization period of the costs would be less than one year . Due to the nature of our products, returns are minimal and an estimate for returns is not material. The timing of revenue recognition may differ from the timing of invoicing to our customers . We recorded unbilled revenue of $ 5,598 and $ 4,511 as of December 31, 2023, and December 31, 2022 , respectively. Determining unbilled revenue involves management judgement. Cost of Goods Sold Cost of goods sold consists primarily of products purchased from third-party suppliers, freight, shipping, excess and obsolete inventory charges and royalties. Implants are manufactured to our specifications by third-party suppliers. Most implants are produced in the U.S. Cost of goods sold is recognized for consigned implants at the time the implant is used in surgery and the related revenue is recognized. Prior to their use in surgery, the cost of consigned implants is recorded as Inventories, net in our Consolidated Balance Sheets. Stock-Based Compensation All stock-based awards to employees and nonemployee contractors, including any grants of stock, stock options, restricted stock units (“RSU”), performance stock units ("PSU") and the option to purchase common stock under the Employee Stock Purchase Plan (“ESPP”), are measured at fair value at the grant date and recognized over the relevant vesting period in accordance with the ASC Topic 718 (“ASC 718”). Stock-based awards to nonemployees are recognized as a selling, general and administrative expense over the period of performance. Such awards are measured at fair value at the date of grant. In addition, for awards that vest immediately, the awards are measured at fair value and recognized in full at the grant date. The Company estimates the fair value of each stock-option award containing service and/or performance conditions on the grant date using the Black-Scholes option valuation model which incorporates assumptions as to stock price volatility, the expected life of the options, risk-free interest rate and dividend yield. The Company relies on its historical volatility as an input to the option pricing model as management believes that this rate will be representative of future volatility over the expected term of the options. The expected term until exercise represents the weighted-average period of time that options granted are expected to be outstanding giving consideration to vesting schedules and the Company’s historical exercise patterns. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant. The Company has not paid any dividends since its inception and does not anticipate paying any dividends for the foreseeable future, so the dividend yield is assumed to be zero. The Company estimates forfeitures of share-based awards at the time of grant and revises such estimates in subsequent periods if actual forfeitures differ from original estimates. Option awards are generally granted with an exercise price equal to the fair value of the Company’s common stock at the date of grant. Subsequent to the IPO, the fair value of the Company’s common stock underlying its equity awards is based on the quoted market price of the Company’s common stock on the grant date. Prior to the IPO, because there was no public market for the Company’s common stock, the fair value of the common stock underlying the stock awards has historically been determined at the time of grant of the stock option by considering a number of objective and subjective factors, including sales of shares of common stock, third-party valuations performed, important developments in the Company’s operations, actual operating results and financial performance, the conditions in the medical device industry and the economy in general, and the stock price performance, volatility of comparable public companies, and an assumption for a discount for lack of marketability, among other factors. Research and Development Research and development expense is comprised of in-house research and development of new products and technologies, clinical studies and trials, regulatory expenses, and employee related compensation and expenses. We maintain a procedurally focused approach to product development and have projects underway to add new products to our existing systems and to add new systems across multiple foot and ankle indications. Leases At the inception of a contractual arrangement, the Company determines whether the contract contains a lease by assessing whether there is an identified asset and whether the contract conveys the right to control the use of the identified asset in exchange for consideration over a period of time. If both criteria are met, the Company calculates the associated lease liability and corresponding right-of-use asset upon lease commencement using a discount rate based on a borrowing rate commensurate with the term of the lease. The Company records lease liabilities within current liabilities or long-term liabilities based upon the length of time associated with the lease payments. The Company records its operating lease right-of-use assets within other assets. Contingencies A liability is contingent if the amount is not presently known but may become known in the future as a result of the occurrence of some uncertain future event. We accrue a liability for an estimated loss if we determine that the potential loss is probable of occurring and the amount can be reasonably estimated. Significant judgment is required in both the determination of probability and the determination as to whether the amount of an exposure is reasonably estimable, and accruals are based only on the information available to our management at the time the judgment is made. We expense legal costs, including those legal costs incurred in connection with a loss contingency, as incurred. Recently Adopted Accounting Pronouncements In December 2019, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("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 a llocations, 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. 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 Consolidated Financial Statements and related disclosures. In June 2016, the FASB issued 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. 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 Consolidated Financial Statements and related disclosures. Recently Issued Accounting Pronouncements In October 2023, the FASB issued Accounting Standards Update ASU 2023-06, Disclosure Improvements: Codification Amendments in Response to the SEC's Disclosure Update and Simplification Initiative. The amendments in ASU 2023-06 modify the disclosure or presentation requirements of a variety of Topics in the Codification. Certain of the amendments represent clarifications to or technical corrections of the current requirements. ASU 2023-06 is applicable to all entities subject to the SEC's existing disclosure requirements. The effective date for each amendment will be the date on which the SEC's removal of that related disclosure from Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited. The Company is currently evaluating the amendments in ASU 2023-06 and does not expect the adoption to have a significant impact on the Company's related disclosures. In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures ("ASU 2023-07"), which provides amendments to improve reportable segment disclosures requirements. The amendments in ASU 2023-07 are effective for fiscal years beginning after December 15, 2023, with early adoption permitted. The Company is currently evaluating the amendments in ASU 2023-07 and does not expect the adoption to have a significant impact on the Company's related disclosures. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures ("ASU 2023-09"), to enhance the transparency and decision usefulness of income tax disclosures. The main provisions in ASU 2023-09 enhance the disclosure requirements of rate reconciliations and income taxes paid. For public business entities, the amendments in ASU 2023-09 are effective for annual periods beginning after December 15, 2024. Early adoption is permitted for annual financial statements that have not yet been issued or made available for issuance. The amendments in this update should be applied on a prospective basis, retrospective application is permitted. The Company is currently evaluating the amendments in this guidance to determine the impact it will have on the Company's Consolidated Financial Statements and r |
Business Combinations
Business Combinations | 12 Months Ended |
Dec. 31, 2023 | |
Business Combinations [Abstract] | |
Business Combinations | NOTE 3. BUSINESS COMBINATIONS Disior 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. Acquisition related costs were $ 761 during the year ended December 31, 2022, and are included in Selling, general, and administrative expenses in the Consolidated Statements of Operations and Comprehensive Loss. No acquisition related costs were incurred during the year ended December 31, 2023. 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 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 Estimated Useful Life Developed technology $ 6,400 12 Tradenames 400 Indefinite 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. There is no supplemental proforma presentation of operating results of the acquisition of Disior due to the immaterial impact on the Company’s Consolidated operations for the years ended December 31, 2022 and 2021. Additive Orthopaedics On May 28, 2021 (“Closing Date”), the Company entered into an Asset Purchase Agreement (“APA”) with Additive Orthopaedics, LLC (“Additive”) and completed an acquisition of substantially all of the operating and intangible assets of Additive, for total cash consideration of $ 15,000 at closing. The APA also provided for potential earn-out consideration to Additive in connection with the achievement of certain milestones, including both project-based and revenue-based milestones, with various expiration dates through the fourth anniversary of the Closing Date. The earn-out has a maximum payment not to exceed $ 9,500 , in the aggregate. If an individual milestone is not met by the specified milestone expiration date, no earn-out related to that specific milestone is due. The contingent earn-out consideration had an estimated fair value of $ 2,870 as of the Closing Date. Acquisition related costs were approximately $ 822 during the year ended December 31, 2021, and are included in Selling, general, and administrative expenses in the Consolidated Statements of Operations and Comprehensive Loss. No acquisition related costs were incurred during the years ended December 31, 2023 and 2022. The Company has accounted for the acquisition of Additive under ASC Topic 805, Business Combinations (“ASC 805”). Additive’s results of operations are included in the Consolidated Financial Statements beginning after May 28, 2021, the acquisition date. The following table summarizes the purchase consideration transferred in connection with the acquisition of Additive and consists of the following: Consideration Paid Cash consideration $ 15,000 Contingent consideration 2,870 Total consideration $ 17,870 The following table summarizes the fair values of the assets acquired and liabilities assumed as of the Closing Date: Assets acquired: Accounts receivable $ 761 Inventory 113 Intangible assets 11,560 Goodwill 6,329 Total assets acquired 18,763 Liabilities assumed: Accounts payable 796 Accrued expenses 97 Total liabilities assumed 893 Net assets acquired $ 17,870 Identified intangible assets consist of noncompete arrangements, customer relationships, 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, and asset approach valuation methodologies, 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 entire amount of the purchase price allocated to goodwill will be deductible for income tax purposes pursuant to Internal Revenue Code Section 197 over a 15-year period. The useful life determination was made by management in line with the Company’s policy on assets. Both determinations are outlined in the table below: Fair Value Estimated Useful Life Noncompete arrangements $ 30 3 Customer relationships 240 3 Developed technology 11,290 12 $ 11,560 There is no supplemental proforma presentation of operating results of the acquisition of Additive due to the immaterial impact on the Company’s Consolidated operations for the years ended December 31, 2022 and 2021. |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | NOTE 4. PROPERTY AND EQUIPMENT Property and equipment as of December 31, 2023 and 2022 consist of the following: Estimated Life December 31, (in years) 2023 2022 Surgical instrumentation 3 - 5 $ 60,100 $ 44,625 Land 3,625 3,625 Buildings 25 20,190 14,178 Leasehold improvements Various 8,307 7,961 Computer and software 3 - 5 16,546 11,562 Machinery and equipment 5 3,843 2,815 Office equipment and furniture 5 - 7 2,267 2,049 Construction in progress Various 288 5,817 Other 5 - 15 2,785 1,046 117,951 93,678 Less: accumulated depreciation ( 43,829 ) ( 31,740 ) Property and equipment, net $ 74,122 $ 61,938 Depreciation expense is included in Selling, general, and administrative expenses in the Consolidated Statements of Operations and Comprehensive Loss and was $ 13,515 , $ 10,824 and $ 7,615 for the years ended December 31, 2023, 2022 and 2021 respectively. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | NOTE 5. GOODWILL AND INTANGIBLE ASSETS Goodwill Our annual impairment testing date is October 1. The Company determined, after performing the qualitative analysis that there was no evidence that it is more likely than not that the fair value of Goodwill was less than the carrying amount. Therefore, it was not necessary to perform a quantitative impairment test. As of December 31, 2023 and 2022 , goodwill was $ 25,465 . Intangibles Intangible assets as of December 31, 2023 are as follows: Estimated Useful Life Gross Carrying Amount Accumulated Amortization Net Carrying Amount Trademarks and tradenames, indefinite-lived Indefinite $ 987 $ — $ 987 Patents, definite-lived 17.6 7,900 2,649 5,251 Customer relationships 3 - 7 1,733 567 1,165 Developed technology 12 17,690 3,424 14,267 Other intangibles 3 30 26 4 Total intangible assets, net $ 28,340 $ 6,666 $ 21,674 Intangible assets as of December 31, 2022, are as follows: Estimated Useful Life Gross Carrying Amount Accumulated Amortization Net Carrying Amount Trademarks, indefinite-lived Indefinite $ 901 $ — $ 901 Patents, definite-lived 16.5 6,671 2,370 4,301 Customer relationships 3 - 7 1,733 279 1,454 Developed technology 12 17,690 1,973 15,717 Other intangibles 3 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 $ 2,027 , $ 2,904 and $ 1,372 for the years ended December 31, 2023, 2022 and 2021, respectively. Expected future amortization expense is as follows: 2024 $ 1,981 2025 1,940 2026 1,940 2027 1,940 2028 1,929 No impairment charges related to intangible assets and goodwill were recorded for the years ended December 31, 2 0 23, 2022 and 2021 . |
Accrued Expenses
Accrued Expenses | 12 Months Ended |
Dec. 31, 2023 | |
Accrued Liabilities, Current [Abstract] | |
Accrued Expenses | NOTE 6. ACCRUED EXPENSES Accrued expenses consist of the following as of December 31, 2023 and 2022, respectively: December 31, 2023 2022 Accrued commissions $ 6,126 $ 6,026 Accrued compensation 10,213 8,569 Accrued purchases 1,883 204 Accrued earnout payment 2,000 6,500 Accrued interest 2,006 450 Other accrued expenses 5,553 5,058 Total accrued expenses $ 27,781 $ 26,807 |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 12 Months Ended |
Dec. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | NOTE 7. 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 December 31, 2023, were as follows: Level 1 Level 2 Level 3 Total Financial Assets: Interest rate swap $ — 991 — $ 991 Financial Liabilities: Contingent consideration $ — — 340 $ 340 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 year ended December 31, 2023, we reassessed the fair value of our interest rate swap which resulted in an increase of $ 991 , the change in fair value is recorded in Other assets on the Consolidated Balance Sheet, Other income (expense) within the 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 year ended December 31, 2023: Balance, December 31, 2022 $ 3,640 Achieved milestones paid ( 2,500 ) Achieved milestones reclassified to accrued expenses ( 1,000 ) Change in fair value of earn-out liabilities 200 Balance, December 31, 2023 340 As of December 31, 2023, the contingent earn-out liabilities are included in Other-current liabilities on the Consolidated Balance Sheet. During the year ended December 31, 2023, we reassessed the estimate of the earn-out liabilities which resulted in a net increase o f $ 200 recorded in Other (expense) income within the Consolidated Statement of Operations and Comprehensive Loss for the year ended December 31, 2023. 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 year ended December 31, 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 December 31, 2023, the remaining $ 1,000 related to the Additive Orthopaedics milestone was included in Accrued expenses on the Condensed Consolidated Balance Sheet and is included as restricted cash within the Consolidated Statement of Cash Flows for the year ended December 31, 2023. In addition, we completed two project milestones associated with the Disior acquisition and one project milestone associated with the Additive acquisition as of December 31, 2023. The Additive milestone and one of the Disior milestones were paid in cash during the year ended December 31, 2023, and the remaining Disior milestone totaling $ 1,000 is included in Accrued expenses on the Consolidated Balance Sheet as of December 31, 2023. For additional information on the Disior and Additive Orthopaedics acquisitions refer to Note 3 to our Consolidated Financial Statements. |
Debt
Debt | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
Debt | NOTE 8. DEBT Long-term debt as of December 31, 2023, and December 31, 2022, consists of the following: December 31, 2023 December 31, 2022 Ares Revolving Loan $ 25,000 $ — Ares Term Loan 75,000 — MidCap Term Loan — 30,000 Zions Term Loan 14,933 15,573 Bank of Ireland Note Payable — 86 114,933 45,659 Less: deferred issuance costs ( 4,494 ) ( 2,749 ) Total debt, net of issuance costs 110,439 42,910 Less: current portion ( 640 ) ( 728 ) Long-term debt, net, less current maturities $ 109,799 $ 42,182 Ares Credit Agreement On November 2, 2023, the Company entered into a new credit agreement with Ares Capital Corporation to provide a total 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 the Company to maintain certain minimum revenue levels. As of December 31, 2023, the Company was in compliance with all financial covenants under the Ares Credit Agreement. Total debt issuance costs associated with the Ares Credit Agreement were $ 4,275 . Amortization expense associated with such debt issuance costs totaled $ 147 , $ 0 and $ 0 for the years ended December 31, 2023, 2022 and 2021, respectively and is included in Interest expense on the Consolidated Statements of Operations and Comprehensive Loss. MidCap Credit Agreements On May 6, 2021, the Company entered into a new 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 matured 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 were due on the Termination Date. Interest payments were 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 Loa n provided 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. On November 2, 2023, 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. During the year ended December 31, 2023, the Company recorded a loss on early extinguishment of debt of $ 5,308 , inclusive of the write-off of remaining unamortized debt issuance costs of $ 1,881 and fees incurred to exit the MidCap Credit Agreements early of $ 3,427 . Amortization expense associated with debt issuance costs prior to write-off totaled $ 613 , $ 586 and $ 576 for the years ended December 31, 2023, 2022 and 2021, respectively, and is included in Interest expense on the Consolidated Statements of Operations and Comprehensive Loss. Vectra Bank Colorado Loan Agreements 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 . 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) th e 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. Effective as of November 2, 2023, the Company entered into the Second Amendment to the Zions Facility (the "Second Amendment"). The Second Amendment replaces references to MidCap Financial Trust and MidCap Credit Agreements with references to Ares and the Ares Credit Agreement. As of December 31, 2023, the Company was in compliance with all financial covenants under the Second Amendment. Total debt issuance costs associated with the Zions Facility were $ 219 . Amortization expense associated with such debt issuance costs totaled $ 16 , $ 13 and $ 0 for the years ended December 31, 2023, 2022 and 2021, respectively, and is included in Interest expense on the Consolidated Statements of Operations and Comprehensive Loss. Bank of Ireland Note Payable On June 12, 2020, the Company entered a term loan with Bank of Ireland in a principal amount of $ 474 (the “Bank of Ireland Note Payable”). The Bank of Ireland Note Payable bore an annual interest rate of 4 % and was due in equal monthly installments over a 36 -month period, including interest. The Company repaid the Bank of Ireland Note Payable in 2023. Debt Maturities Schedule The required principal payments for the Ares Revolving Loan, Ares Term Loan and the Zions Facility following the Consolidated Balance Sheet dates are as follows: 2024 $ 640 2025 640 2026 640 2027 640 2028 100,640 Thereafter 11,733 Total $ 114,933 |
Convertible Preferred Series Eq
Convertible Preferred Series Equity and Stockholders' Equity | 12 Months Ended |
Dec. 31, 2023 | |
Stockholders' Equity Note [Abstract] | |
Convertible Preferred Series Equity And Stockholders' Equity | NOTE 9. CONVERTIBLE PREFERRED SERIES EQUITY AND 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 approximately $ 68,453 after deducting underwriting discounts and commissions and offering expenses payable by the Company. The selling securityholders received aggregate net proceeds from the Offering of approximately $ 50,700 after deducting underwriting discounts and commissions. The Company did not receive any of the proceeds from the sale of shares of Common Stock by the selling securityholders. The Company did no t issue any common stock during the year ended December 31, 2022. Each holder of common stock is entitled to one vote for each share owned on all matters voted upon by the stockholders, and a majority vote is required for all actions taken by stockholders. Common stock has no preemptive rights, no cumulative voting rights and no redemption or conversion provisions. Holders of common stock are entitled to receive dividends when and if, declared by the Board of Directors. Series A Convertible Preferred Stock In December 2011, the Company issued an aggregate of 3,250,005 shares of its Series A convertible preferred stock at a price of $ 0.30769 per share, resulting in total proceeds of approximately $ 1,000 . In February and November 2012, the Company issued an aggregate of 10,562,495 shares of its Series A convertible preferred stock at a price of $ 0.30769 per share, resulting in total proceeds of approximately $ 3,250 . In October 2021, in connection with the IPO, all of the shares of the Company’s outstanding Series A convertible preferred stock automatically converted into an aggregate of 13,812,500 shares of common stock. Series B Convertible Preferred Stock In July 2020, the Company issued an aggregate of 6,608,700 shares of its Series B convertible preferred stock at a price of $ 5.75 per share, resulting in total net proceeds of approximately $ 36,030 , net of issuance costs of $ 1,970 . In connection with the IPO, all of the shares of the Company’s outstanding Series B convertible preferred stock automatically converted into an aggregate of 6,608,700 shares of the common stock. Pursuant to the terms of the Series B convertible preferred stock offering, the $ 2,328 of cash dividends accrued as of October 19, 2021, were cancelled upon conversion of the Series B preferred stock into common stock. Treasury Stock The Company did no t purchase any shares of its common stock during the years ended December 31, 2023 and 2022. The Company purchased a total of 85,049 shares of its common stock during the year ended December 31, 2021 for $ 561 . Shares purchased during the year ended December 31, 2021, were at an average of $ 6.60 per share. All repurchased shares were recorded in Treasury stock at cost. |
Loss Per Share
Loss Per Share | 12 Months Ended |
Dec. 31, 2023 | |
Earnings Per Share [Abstract] | |
Loss Per Share | NOTE 10. 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 loss per 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 if-converted method based on the nature of such securities. In periods when losses from continuing operations are reported, the weighted-average number of common stock outstanding excludes common stock equivalents because their inclusion would be anti-dilutive. The computation of net loss per share for the years ended December 31, 2023, 2022 and 2021, respectively was as follows: Year Ended December 31, 2023 2022 2021 Net loss $ ( 47,841 ) $ ( 67,326 ) $ ( 13,693 ) Weighted-average common stock outstanding: Basic 82,087,329 76,766,100 52,916,711 Diluted 82,087,329 76,766,100 52,916,711 Loss per share: Basic $ ( 0.58 ) $ ( 0.88 ) $ ( 0.26 ) Diluted $ ( 0.58 ) $ ( 0.88 ) $ ( 0.26 ) 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: December 31, 2023 2022 2021 Stock options 5,943,898 6,538,536 7,953,018 Restricted stock units 1,317,402 964,054 79,886 |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-Based Compensation | NOTE 11. STOCK-BASED COMPENSATION The Company's Employee Stock Purchase Plan ("ESPP") and 2021 Incentive Award Plan (“2021 Plan”) were adopted by the Company’s Board of Directors on October 8, 2021. The ESPP and 2021 Plan were both adopted by the Company’s stockholders on October 19, 2021, and became effective on the date prior to the first date of the effectiveness of the registration statement on Form S-1 filed by the Company. Employee Stock Purchase Plan The ESPP initially provided participating employees with the opportunity to purchase up to an aggregate of 1,329,040 shares of the Company's common stock at 85 % of the market price at the lesser of the date the purchase right is granted or exercisable. The ESPP provides that the number of shares reserved and available for issuance will automatically increase each January 1, beginning on January 1, 2022, and ending on January 1, 2031, by the lesser of 1 % of all classes of the Company's common stock outstanding on the immediately preceding December 31, or such smaller number of shares as determined by the Company's Board or the committee. As of December 31, 2023, 2,758,808 shares remained available for issuance. 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. During the years ended December 31, 2023 and 2022, the Company issued 73,442 and 38,968 shares, respectively, upon exercise of purchase rights. The Company recognizes compensation expense on a straight-line basis over the service period. During the years ended December 31, 2023 and 2022, the Company recognized $ 322 and $ 213 of compensation expense, respectively, related to the ESPP. There were no shares issued and no compensation expense was recognized related to the ESPP during 2021. Below are the assumptions used for the years ended December 31, 2023 and 2022 in determining the fair value of shares under the ESPP. Year Ended December 31, 2023 2022 Expected volatility 54.64 % 70.27 % Expected dividends — — Expected term (in years) 0.50 0.50 Discount rate 15.00 % 15.00 % Risk-free rate 5.26 % 2.79 % 2021 Incentive Award Plan The 2021 Plan authorized the Company to issue an initial aggregate maximum number of shares of common stock equal to (i) 7,641,979 shares plus (ii) a number of shares that are available for issuance under the 2011 Plan plus (iii) any shares that are subject to 2011 Plan that become available for issuance (via expiration, forfeitures, etc.) plus (iv) an increase commencing on January 1, 2022, and continuing annually on the anniversary thereof through January 1, 2031, equal to the lesser of (a) 5 % of the shares of all classes of the Company’s common stock outstanding on the last day of the immediately preceding calendar year or (b) such smaller number of shares as determined by the Company’s Board or the committee. As of December 31, 2023, the Company had reserved 13,510,971 shares of common stock for future grant. Stock Options The following table summarizes the Company’s stock option plan and the activity for the year ended December 31, 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 ( 458,005 ) 6.56 Forfeited or expired ( 361,633 ) 15.29 Outstanding, December 31, 2023 5,943,898 $ 10.28 6.53 Exercisable, December 31, 2023 4,292,558 $ 8.51 6.02 Vested and expected to vest at December 31, 2023 5,938,438 $ 10.27 6.53 There were 225,000 , 359,054 and 3,467,069 options granted during the years ended December 31, 2023, 2022 and 2021, at a weighted average strike price of $ 18.33 , $ 16.08 and $ 14.63 , respectively. The Company received cash in the amount of $ 2,406 , $ 5,271 and $ 445 from the exercise of stock options for the years ended December 31, 2023, 2022 and 2021, respectively. The tax benefit from equity options exercised were $ 560 , $ 1,223 and $ 93 for the years ended December 31, 2023, 2022 and 2021, respectively. The aggregate intrinsic value of options outstanding at December 31, 2023 , is $ 22,900 . The aggregate intrinsic value of vested and exercisable options at December 31, 2023 is $ 21,530 . The aggregate intrinsic value of options exercised during the years ended December 31, 2023, 2022 and 2021 is $ 4,742 , $ 18,764 and $ 3,743 , respectively. As of December 31, 2023 , there was approximately $ 5,634 total unrecognized compensation cost related to non-vested stock option compensation arrangements, which is expected to be recognized over a weighted average period of 1.78 years. Below are the assumptions used for the years ended December 31, 2023, 2022 and 2021 in determining the fair value of each option award: Year Ended December 31, 2023 2022 2021 Expected volatility 66.20 % 55 % - 70 % 52 % - 55 % Expected dividends — — — Expected term (in years) 6.25 6.00 5.75 - 6.25 Risk-free rate 4.11 % 1.69 - 2.79 % 0.47 % - 1.20 % Restricted Stock Units RSUs granted under the 2021 Plan have a ten-year contractual term and typically vest over a three or four-year period, contingent upon continued service with the Company. The following table summarizes the Company's restricted stock units' activity for the years ended December 31, 2023. Year Ended December 31, 2023 Restricted Stock Units Weighted-Average Fair Value Outstanding, beginning of period 964,054 $ 17.74 Granted 776,359 16.56 Vested ( 273,618 ) 17.65 Forfeited or expired ( 149,393 ) 17.81 Outstanding, end of period 1,317,402 $ 17.06 Vested and expected to vest at end of period 1,305,827 $ 17.05 During the years ended December 31, 2023, 2022 and 2021, the Company granted 776,359 , 929,090 and 79,886 RSU's, respectively. The grant date fair value for RSUs is the thirty-day trailing average market price of the common stock on the date of grant. As of December 31, 2023 , there was approximately $ 18,689 total unrecognized compensation cost related to non-vested RSUs, which is expected to be recognized over a weighted average period of 2.88 years. Stock-Based Compensation Expense Stock-based compensation expenses are recorded in Selling, general and administrative expenses in the Consolidated Statements of Operations and Comprehensive Loss. During the years ended December 31, 2023, 2022 and 2021 , the Company recognized $ 5,542 , $8 ,500 , and $ 4,863 respectively, of compensation expense related to stock options. During the years ended December 31, 2023, 2022 and 2021 , the Company recognized $ 6,822 , $ 1,865 and $ 85 , respectively, of compensation expense related to RSUs. |
Employee Benefit Plan
Employee Benefit Plan | 12 Months Ended |
Dec. 31, 2023 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plan | NOTE 12. EMPLOYEE BENEFIT PLAN The Company sponsors a defined contribution plan for eligible employees who are 21 years of age with three months of service can voluntarily contribute up to 100 % of their eligible compensation. The Company has elected a Safe Harbor plan in which the Company must contribute 3 % of eligible compensation. In addition, the Company may make discretionary contributions which are determined and authorized by the Board of Directors each plan year. The Company made contributions to its employee benefit p lan of $ 1,190 , $ 992 and $ 633 for the years ended December 31, 2023, 2022 and 2021 , respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | NOTE 13. INCOME TAXES Total provision (benefit) for income taxes for the years ended December 31, 2023, 2022 and 2021: December 31, 2023 2022 2021 (Loss) income before taxes Domestic $ ( 46,650 ) $ ( 65,749 ) $ ( 17,030 ) Foreign ( 978 ) ( 1,641 ) 4,050 Total loss before taxes ( 47,628 ) ( 67,390 ) ( 12,980 ) Current tax expense (benefit): Federal 104 — ( 165 ) State 58 96 ( 36 ) Foreign 731 315 744 Total current tax expense 893 411 543 Deferred tax expense (benefit): Federal ( 9,273 ) ( 16,253 ) ( 3,506 ) State ( 1,177 ) ( 1,977 ) ( 464 ) Foreign ( 1,099 ) ( 909 ) 170 Change in valuation allowance 10,869 18,664 3,970 Total deferred tax (benefit) expense ( 680 ) ( 475 ) 170 Total tax (benefit) expense: Federal ( 9,169 ) ( 16,253 ) ( 3,671 ) State ( 1,119 ) ( 1,881 ) ( 500 ) Foreign ( 368 ) ( 594 ) 914 Change in valuation allowance 10,869 18,664 3,970 Total income tax expense (benefit) $ 213 $ ( 64 ) $ 713 The Company had an effective tax rate of ( 0.45 )% and 0.09 % for the years ended December 31, 2023 and 2022, respectively. Significant items that are impacting the rate include valuation allowance applied against domestic and certain foreign deferred tax assets (“DTA”), state taxes, permanent book tax difference for foreign sourced income and stock compensation, R&D Credit and FIN 48. A reconciliation of the provision for income taxes at the federal statutory rate compared to the effective tax rate for the years ended December 31, 2023, 2022 and 2021 is: 2023 2022 2021 Statutory U.S. federal tax rate $ ( 10,002 ) $ ( 14,152 ) $ ( 2,726 ) State taxes net of federal benefit ( 1,132 ) ( 1,901 ) ( 492 ) Non-U.S. earnings taxed at rates different than the U.S. statutory rate 5 ( 80 ) ( 150 ) Foreign source earnings, net of associated foreign tax credits 628 486 601 Benefit of tax credits ( 501 ) ( 458 ) ( 1,569 ) Stock based compensation 27 ( 2,852 ) ( 212 ) Change in valuation allowance 10,869 18,664 3,970 Change in unrecognized tax benefits 175 92 710 Other 144 137 581 Total provision (benefit) for income taxes $ 213 $ ( 64 ) $ 713 As of December 31, 2023 , our foreign operations held cash totaling $ 10,293 . We have not provided for a U.S. deferred tax liability or foreign withholding tax on the undistributed earnings from our non-U.S. subsidiaries that are considered to be indefinitely reinvested. If such earnings were to be distributed, any U.S. deferred tax liability or foreign withholding tax would not be significant. The Company files income tax returns in the U.S. federal jurisdiction, various state jurisdictions and applicable foreign jurisdictions and is no longer subject to U.S. federal or state tax examinations for the years prior to 2020. The 2018 year is open in a limited scope as a result of the 2020 NOL carryback. The open years subject to examinations in the foreign jurisdictions are 2018 through 2023. Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of our deferred taxes as of December 31, 2023 and 2022 were: December 31, 2023 2022 Deferred tax assets: Receivable allowances $ 253 $ 356 Accrued expenses 1,262 5,351 S263A capitalizable costs 3,045 461 Inventory reserves 3,611 3,436 Research and development credits 3,974 3,615 Net operating losses 24,208 13,584 Interest expense 2,407 1,218 Stock-based compensation 4,496 3,324 Lease liability 356 384 R&D IRC 174(b) capitalized costs 5,161 3,433 Other 764 650 Total deferred tax assets 49,537 35,812 Valuation allowance ( 39,802 ) ( 28,933 ) Net deferred tax assets 9,735 6,879 Deferred tax liabilities: Property and equipment ( 6,807 ) ( 5,391 ) Section 481 adjustment ( 821 ) — Patents and trademarks ( 1,343 ) ( 1,304 ) Right of use asset ( 292 ) ( 378 ) Total deferred tax liabilities ( 9,263 ) ( 7,073 ) Total net deferred tax asset (liability) $ 472 $ ( 194 ) A valuation allowance is established when it is “more likely than not” that all, or a portion, of net deferred tax assets will not be realized. As a result, the Company has concluded based on all available evidence and determined that valuation allowances of $ 39,802 in the U.S, Germany, Finland and Italy entities and $ 28,933 in the U.S, Germany and Italy should be provided for certain deferred tax assets at December 31, 2023 and 2022, respectively. As of December 31, 2023 and 2022 the Company had U.S federal net operating loss carryforwards of $ 93,341 and $ 52,349 respectively which have an indefinite carryforward period and $ 52,362 of combined U.S state net operating loss carryforwards in various states that will begin to expire in 2033 . Additionally, the Company has foreign net operating loss carryforwards of $ 10,368 that will begin to expire in 2034 . A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: 2023 2022 Gross unrecognized tax benefits - beginning of period $ 1,431 $ 1,337 Increases related to current year tax positions 92 92 Increases related to prior year tax positions — 2 Gross unrecognized tax benefits - end of period $ 1,523 $ 1,431 The unrecognized tax benefits of $ 1,523 , if recognized, will impact the Company’s effective tax rate. In accordance with the Company's accounting policy, accrued interest and penalties are recognized related to unrecognized tax benefits as a component of tax expense. As of December 31, 2023 , the Company recorded $ 106 of interest or penalties associated with unrecognized tax benefits. The Company expects the total amount of tax contingencies will not decrease in 2024 based on statute of limitation expiration. |
Commitments And Contingencies
Commitments And Contingencies | 12 Months Ended |
Dec. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | NOTE 14. COMMITMENTS AND CONTIGENCIES Leases The Company determines if an arrangement is a lease at inception by assessing whether there is an identified asset and whether the contract conveys the right to control the use of the identified asset in exchange for consideration over a period of time. If both criteria are met, the Company determines the initial classification and measurement of its right-of-use (“ROU”) asset and lease liabilities at the lease commencement date and thereafter, if modified. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. The Company leases certain office space and equipment under operating leases. The Company adopted ASC 842 as of January 1, 2022, and as of December 31, 2022, recorded a lease liability of $ 1,821 and corresponding right-of-use asset of $ 1,795 on its Consolidated Balance Sheet. The lease liability of $ 1,821 consisted of $ 447 of short-term lease liabilities and $ 1,374 of long-term lease liabilities, included in Other current liabilities and Other long-term liabilities, respectively. As of December 31, 2023, right-of-use assets of $ 1,533 are included in Other assets and operating lease liabilities are included within the current and long-term portions of other liabilities of $ 543 and $ 1,048 , respectively on the Consolidated Balance Sheet. During the years ended December 31, 2023 and 2022, the Company recorded lease expense of $ 574 and $ 408 , respectively, as a component of Operating income (expense) in the Consolidated Statement of Operations and Comprehensive Loss Income. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. In order to apply the incremental borrowing rate, a portfolio approach with a collateralized rate was utilized wherein assets were grouped based on similar terms and economic environments in a manner whereby the Company reasonably expects that the application does not differ materially from a lease-by-lease approach. Disclosures Related to Periods Prior to Adoption of ASC 842 Rent expense under operating leases totaled $ 1,369 for the year ended December 31, 2021, and is included in Selling, general, and administrative expense in the Consolidated Statements of Operations and Comprehensive Loss. In January 2022, the Company purchased its corporate headquarters which was previously leased through 2029 . Lease expense for the years ended December 31, 2023 and 2022 do not include expense associated with this lease while rent expense for the year ended December 31, 2021, does. 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. On November 28, 2022, the Company entered into a settlement agreement with Stryker Corp. to settle two complaints filed against the Company and any Company counter claims for a total amount of $ 26,000 paid by the Company to Stryker Corp (the “Settlement Amount”). In addition, the Company incurred $ 1,000 in legal fees associated with the settlement. The Settlement Amount was scheduled to be paid by the Company in three separate installments consisting of: (i) $ 5,000 on or by December 16, 2022, (ii) $ 8,000 at any time between January 1, 2023, and January 16, 2023, and (iii) $ 13,000 at any time between April 1, 2023, and April 17, 2023. The Company remitted all three payments in accordance with the installment schedule. The settlement agreement did not impact the Company’s ability to continue operating its business and did not require any changes to the Company’s existing product lines. The Settlement Amount was the only consideration paid, and the Company is not required to make any future payments to Stryker Corp. The Company entered into the settlement agreement solely to eliminate the burden, expense, distraction, and uncertainties of litigation. The settlement agreement is not, and shall not be construed as, an admission of liability or that the Company engaged in any wrongful, tortious, or unlawful activity. As of December 31 2023, the Company is not involved in any legal proceedings that could have a material adverse effect on its consolidated financial position. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2023 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | NOTE 15. 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 $ 269 , $ 249 and $ 87 for the years ended December 31, 2023, 2022 and 2021, respectively. Amounts payable to this entity as of December 31, 2023 and 2022 were $ 155 and $ 164 , respectively. The Company paid professional services fees to a related party totaling $ 327 , $ 405 and $ 542 for the years ended December 31, 2023, 2022 and 2021, respectively, and are included in Selling, general, and administrative expense in the Consolidated Statements of Operations and Comprehensive Loss. Amounts payable as of December 31, 2023 and 2022 to this related party were $ 16 and $ 0 , respectively. |
Segment and Geographic Informat
Segment and Geographic Information | 12 Months Ended |
Dec. 31, 2023 | |
Segment Reporting [Abstract] | |
Segment and Geographic Information | NOTE 16. SEGMENT AND GEOGRAPHIC INFORMATION Operating segments are defined as components of an enterprise for which separate financial information is available and evaluated regularly by the chief operating decision maker, which is our Chief Executive Officer, in deciding how to allocate resources and in assessing performance. We manage our business globally within one operating segment in accordance with ASC Topic 280, Segment Reporting (“ASC 280”). Segment information is consistent with how management reviews the business, makes investing and resource allocation decisions and assesses operating performance. Product sales attributed to a country or region includes product sales to hospitals, physicians and distributors. No individual customer accounted for more than 10% of total product sales for any of the periods presented. No customer accounted for more than 10% of consolidated accounts receivable as of December 31, 2023 and 2022. The following table represents total net revenue by geographic area, based on the location of the customer for the years ended December 31, 2023, 2022 and 2021, respectively. Year Ended December 31, 2023 2022 2021 United States $ 183,505 $ 158,105 $ 130,112 International 32,884 23,278 17,352 Total net revenue $ 216,389 $ 181,383 $ 147,464 No individual country with net revenue originating outside of the United States accounted for more than 10% of consolidated net revenue for the years ended December 31, 2023, 2022 and 2021. The following table represents total non-current assets, excluding deferred taxes, by geographic area for the years ended December 31, 2023 and 2022, respectively. December 31, 2023 December 31, 2022 United States $ 89,531 $ 79,458 Finland 25,032 25,581 Other International 9,617 6,546 Total assets $ 124,179 $ 111,585 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Consolidation | Basis of Presentation and Consolidation The accompanying Consolidated Financial Statements include the accounts of Paragon 28, Inc. and its subsidiaries, all of which are wholly-owned. All intercompany balances and transactions have been eliminated in consolidation. The accompanying Consolidated Financial Statements have been prepared in conformity with accounting principles generally accepted in the U.S. (“U.S. GAAP”). |
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 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 liability, income taxes and stock-based compensation. |
Foreign Currency Translation | Foreign Currency Translation The 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 year-end exchange rates, while revenue and expenses are translated at average exchange rates during the year 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. |
Business Combinations | Business Combinations We allocate the purchase consideration to the identifiable net assets acquired, including intangible assets and liabilities assumed, 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, is recorded as goodwill. During the measurement period, which is up to one year from the acquisition date, we may adjust provisional amounts that were recognized at the acquisition date to reflect new information obtained about facts and circumstances that existed as of the acquisition date. Determining the fair value of assets acquired and liabilities assumed requires significant judgment, including the selection of valuation methodologies including the income approach, the cost approach, and the market approach. Significant assumptions used in those methodologies include, but are not limited to, the expected values of the underlying metric, the systematic risk embedded in the underlying metric, the volatility of the underlying metric, the risk-free rate, and the counterparty risk. The use of different valuation methodologies and assumptions is highly subjective and inherently uncertain and, as a result, actual results may differ materially from estimates. |
Cash | Cash Cash consists of highly liquid investments with an original maturity of three months or less. As of December 31, 2023, $ 1,000 related to the achievement of an Additive Orthopaedics acquisition milestone was included as restricted cash within the Consolidated Balance Sheets and Consolidated Statement of Cash Flows. For additional information regarding the Additive Orthopaedics acquisition refer to Note 3 to our Consolidated Financial Statements. There were no contractual or other restrictions as to the use of cash for the years ended December 31, 2022 or 2021. |
Trade Receivables, Less Allowance for Doubtful Accounts | Trade Receivables, Less Allowance for Doubtful Accounts Trade receivables due from customers are uncollateralized customer obligations due under normal trade terms requiring payment within 30 days from the invoice date and are stated at the amount billed to the customer. Trade receivables also include unbilled receivables due from customers that represent completed surgical cases that are pending customer-issued purchase orders. These unbilled receivables are covered by agreements with customers, the products have typically been used in a surgery, and collection is determined to be probable. The Company estimates an allowance for doubtful accounts based upon an evaluation of the current status of receivables, historical experience, and other factors as necessary. It is reasonably possible that the Company’s estimate of the allowance for doubtful accounts will change. The following table presents the activity in the allowance for doubtful accounts for the years ended December 31, 2023 and 2022. December 31, 2023 2022 Allowance for doubtful accounts, beginning of year $ 1,688 $ 1,032 Additions charged against revenue or to expense 223 1,853 Write-offs ( 572 ) ( 1,197 ) Allowance for doubtful accounts, end of year $ 1,339 $ 1,688 |
Inventories, Net | Inventories, Net Inventories are considered finished goods and are purchased from third party contract manufacturers. These inventories consist of implants, hardware, and consumables and are held in our warehouse, with third-party independent sales representatives or distributors, or consigned directly with hospitals. Inventories are stated at the lower of cost (weighted average cost basis) or net realizable value. When sold, inventory is relieved at weighted average cost. We evaluate the carrying value of our inventories in relation to historical sales, current inventory levels, and consideration of the life cycle of the product. A significant decrease in demand or development of products could result in an increase in the amount of excess inventory on hand, which could lead to additional charges for excess and obsolete inventory. The Company estimates a reserve for obsolete and slow-moving inventory based on current inventory levels and historical sales. (Income ) expenses for excess and obsolete inventory are included in Cost of goods sold. The inventory reserve was $ 16,532 and $ 16,804 as of December 31, 2023 and 2022, respectively. The need to maintain substantial levels of inventory impacts our estimates for excess and obsolete inventory. Each of our implant systems are designed to include implantable products that come in different sizes and shapes to accommodate the surgeon’s needs related to the patient’s anatomical size. Typically, a small number of the set components are used in each surgical procedure. Certain components within each set may become obsolete before other components based on the usage patterns. We adjust inventory values, as needed, to reflect these usage patterns and life cycle. |
Property and Equipment, Net | Property and Equipment, Net Property and equipment are recorded at cost less accumulated depreciation. Expenditures for renewals and improvements that significantly add to the productive capacity or extend the useful life of an asset are capitalized and included in Property and equipment, net in the Consolidated Balance Sheets. Expenditures for maintenance and repairs are charged to expense as incurred and are included in Selling, general, and administrative expense in the Consolidated Statements of Operations and Comprehensive Loss. When equipment is retired or sold, the cost and related accumulated depreciation are eliminated from the accounts and the resulting gain or loss is included in included in Selling, general and administrative in the Consolidated Statements of Operations and Comprehensive Loss. Depreciation is provided using the straight-line method based on useful lives of the assets which range from three to twenty-five years , which best reflects the pattern of use. The Company depreciates surgical instrumentation, once available for use, over a five-year period and cases, once available for use, over a three-year period. Depreciation for surgical instrumentation used in surgery is included in Selling, general, and administrative expense in the Consolidated Statements of Operations and Comprehensive Loss. Leasehold improvements are amortized using the straight-line method over the shorter of the asset’s useful life or the lease term. Property and equipment are assessed for impairment upon triggering events that indicate that the carrying value of an asset group may not be recoverable. Recoverability is measured by a comparison of the carrying amount to future net undiscounted cash flows of the asset group expected to be generated from its use and eventual disposition. If the asset group’s carrying value is determined to not be recoverable, the impairment to be recognized is measured by which the carrying amount exceeds the fair value of the asset group. No impairment charges related to property and equipment were recorded in any of the periods presented. |
Intangibles | Intangibles The costs associated with applying for patents and trademarks are capitalized. Patents are amortized on a straight-line basis over the lesser of the patent’s economic or legal life, which is seventeen years . Costs associated with capitalized patents include third-party attorney fees and other third-party fees as well as costs related to the following: the preparation of patent applications, government filings and registration fees, drawings, computer searches, and translations related to specific patents. Trademarks that are anticipated to be renewed every ten years have an indefinite life and are not amortized but tested for impairment annually. Once it is determined a trademark will no longer be renewed, the trademark is amortized over the remainder of the trademark’s registration period. Customer relationships are amortized over an estimated useful life of three to seven years on a straight-line basis. Other intangibles, which mainly consist of noncompete arrangements, are amortized over an estimated useful life of three years on a straight-line basis. Developed technology is amortized over an estimated useful life of twelve years on a straight-line basis. Amortizable intangible assets are assessed for impairment upon triggering events that indicate that the carrying value of an asset may not be recoverable. Recoverability is measured by a comparison of the carrying amount to future net undiscounted cash flows expected to be generated by the associated asset. If the asset’s carrying value is determined to not be recoverable, the impairment to be recognized is measured by the amount by which the carrying amount exceeds the fair market value of the intangible assets. No impairment charges related to amortizable assets were recorded for the years ended December 31, 2023, 2022 and 2021. Indefinite-lived trademark assets are reviewed for impairment annually or whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. The Company can elect to first apply the optional qualitative impairment assessment to determine whether the indefinite-lived intangible asset is more-likely-than-not impaired. If, on the basis of the qualitative impairment assessment, an entity asserts that it is more likely than not that the indefinite-lived intangible asset is impaired, the Company would be required to calculate the fair value of the asset for an impairment test. Impairment loss is recognized if the carrying amount of the asset exceeds its fair value. A qualitative assessment considers macroeconomic and other industry-specific factors, such as trends in short-term and long-term interest rates and the ability to access capital, and company specific factors such as trends in revenue generating activities, and merger or acquisition activity. If the Company elects to bypass qualitatively assessing its indefinite-lived intangible assets, or it is not more likely than not that the fair value of the intangible asset exceeds its carrying value, management estimates the fair value of the intangible asset and compares it to the carrying value. The estimated fair value of the intangible asset is established using an income approach based on a discounted cash flow model that includes significant assumptions about the future operating results and cash flows of the intangible asset or assets. The Company elected to perform a qualitative analysis for its indefinite-lived intangible assets as of October 1, 2023, the annual test date. The Company determined, after performing the qualitative analysis that there was no evidence that it is more likely than not that the fair value of its intangible assets was less than the carrying amount. Therefore, it was not necessary to perform a quantitative impairment test. |
Goodwill | Goodwill Goodwill represents the excess of the purchase price as compared to the fair value of net assets acquired and liabilities assumed. Goodwill is not amortized, but is tested for impairment annually or when indications of impairment exist. Goodwill is tested at the reporting unit level as defined in ASC 350. Per this definition, a reporting unit is an operating segment or one level below an operating segment. The Company has determined one reporting unit for the purpose of goodwill impairment. We can elect to qualitatively assess goodwill for impairment if it is more likely than not that the fair value of a reporting unit exceeds its carrying value. Impairment exists when the carrying amount, including goodwill, of the reporting unit exceeds its fair value, resulting in an impairment charge for this excess (not t o exceed the carrying amount of the goodwill). The impairment, if determined, is recorded within Operating expenses in the Consolidated Statements of Operations and Comprehensive Loss in the period the determination is made. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. There is a three-tier fair value hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value: 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. Financial instruments (principally cash, trade receivables, accounts payable and accrued expenses) are carried at cost, which approximates fair value due to the short-term maturity of these instruments. The majority of our debt is carried at cost, which approximates fair value due to the variable interest rate associated with our debt. However, we are the fixed rate payor on an interest rate swap contract associated with the Company's Zions Facility, which is classified as Level 2. We reassess the fair value of our interest rate swap on a quarterly basis. The change in fair value is recorded in other (expense) income in the Consolidated Statements of Operations and Comprehensive Loss. The Company does not have any assets or liabilities presented in the Level 1 category as of December 31, 2023, and 2022, and there were no changes in level hierarchies during the years ended December 31, 2023, 2022 and 2021 . See "Contingent Earn-out Consideration" below for a discussion on our Level 3 inputs. |
Contingent Earn-Out Consideration | Contingent Earn-out Consideration Business combinations may include contingent earn-out consideration as part of the purchase price under which the Company will make future payments to the seller upon the achievement of certain milestones. The fair value of the contingent earn-out consideration is estimated as of the acquisition date at the present value of the expected contingent payments and is subsequently remeasured at each balance sheet date. Two methodologies may be considered in the valuation: the scenario-based model (“SBM”) and Monte Carlo simulation. The SBM relies on multiple outcomes to estimate the likelihood of future payoff of the contingent consideration. The resulting earnout payoff is then probability-weighted and discounted at an appropriate risk adjusted rate in order to arrive at the present value of the expected earnout payment. The Monte Carlo simulation is used to value the non-linear contingent considerations based on projected financial metrics. Each trial of the Monte Carlo simulation draws a value from the assumed distribution for the underlying metric. The earnout payoff for each simulation trial is calculated based on that particular simulated path for the underlying metrics and then discounted to present value using the risk-free rate, adjusted for counterparty credit risk. The value of the earnout is estimated as the average value from all simulation trials. The fair value estimates use unobservable inputs that reflect our own assumptions as to the ability of the acquired business to meet the targeted benchmarks and discount rates used in the calculations. The unobservable inputs are defined in ASC Topic 820, “Fair Value Measurements and Disclosures,” as Level 3 inputs. We review the probabilities of achievement of the earnout milestones to determine impact on the fair value of the earnout consideration on a quarterly basis over the earn-out period. Actual results are compared to the estimates and probabilities of achievement used in our forecasts. Should actual results of the acquired business increase or decrease as compared to our estimates and assumptions, the estimated fair value of the contingent earn-out consideration liability will increase or decrease, up to the contractual limit, as applicable. Changes in the estimated fair value of the contingent earn-out consideration are recorded in other income (expense) in the Consolidated Statements of Operations and Comprehensive Loss and are reflected in the period in which they are identified. Changes in the estimated fair value of the contingent earn-out consideration may materially impact or cause volatility in our operating results. |
Income Taxes | Income Taxes The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, the Company determines deferred tax assets and liabilities on the basis of the differences between the financial statement and tax bases of assets and liabilities by using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. The Company regularly reviews its deferred tax assets for recoverability and establishes a valuation allowance if it is more likely than not that some portion, or all, of a deferred tax asset will not be realized. The determination as to whether a deferred tax asset will be realized is made on a jurisdictional basis and is based on both positive and negative evidence. This evidence includes historic taxable income, projected future taxable income, the expected timing of the reversal of existing temporary differences and the implementation of tax planning strategies. The Company records uncertain tax positions in accordance with Accounting Standards Codification (“ASC”) Topic 740 on the basis of a two-step process in which (1) the Company determines whether it is more-likely-than-not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, the Company recognizes the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. The Company evaluates its tax positions that have been taken or are expected to be taken on income tax returns to determine if an accrual is necessary for uncertain tax positions. The Company will recognize interest and penalties as a component of income tax expense if incurred. |
Revenue Recognition | Revenue Recognition We account for revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”). Revenue is generated primarily from the sale of our implants and disposables and, to a much lesser extent, from the sale of our surgical instrumentation. We sell our products through employee sales personnel, and independent sales representatives in the U.S. Outside the U.S. sales are through independent sales representatives and to stocking distributors. We have consignment agreements with certain distributors and hospitals. Our customers are primarily hospitals and surgery centers. Revenue is recorded, net of estimated discounts and other price concessions, when our performance obligation is satisfied which is when our customers take title of the product, and typically when the product is used in surgery. We generally have written contracts with our customers which incorporate pricing and our standard terms and conditions. Any discounts we offer are outlined in our customer agreements. As the discounts are known at the time of purchase, no estimates are required at the time of revenue recognition. Shipping and handling costs are recorded as cost of goods sold and amounts billed to customers for shipping and handling costs are recorded in revenue. We record as revenue any amounts billed to customers for shipping and handling costs and record as cost of goods sold the actual shipping costs incurred. We have elected to exclude from the measurement of the transaction price all taxes (e.g., sales, use, value-added) assessed by government authorities and collected from a customer. Therefore, revenue is recognized net of such taxes. We have elected to use the practical expedient allowed under ASC 606 to account for shipping and handling activities that occur after the customer has obtained control of a promised good as fulfillment costs rather than as an additional promised service and, therefore, we do not allocate a portion of the transaction price to a shipping service obligation. Commissions to sales agents for the sales exceeding their quotas are classified as incremental costs of obtaining a contract as such costs would not have been incurred if the contract was not signed. We have elected to use the practical expedient to expense such costs that should be capitalized as the amortization period of the costs would be less than one year . Due to the nature of our products, returns are minimal and an estimate for returns is not material. The timing of revenue recognition may differ from the timing of invoicing to our customers . We recorded unbilled revenue of $ 5,598 and $ 4,511 as of December 31, 2023, and December 31, 2022 , respectively. Determining unbilled revenue involves management judgement. |
Cost of Goods Sold | Cost of Goods Sold Cost of goods sold consists primarily of products purchased from third-party suppliers, freight, shipping, excess and obsolete inventory charges and royalties. Implants are manufactured to our specifications by third-party suppliers. Most implants are produced in the U.S. Cost of goods sold is recognized for consigned implants at the time the implant is used in surgery and the related revenue is recognized. Prior to their use in surgery, the cost of consigned implants is recorded as Inventories, net in our Consolidated Balance Sheets. |
Stock-Based Compensation | Stock-Based Compensation All stock-based awards to employees and nonemployee contractors, including any grants of stock, stock options, restricted stock units (“RSU”), performance stock units ("PSU") and the option to purchase common stock under the Employee Stock Purchase Plan (“ESPP”), are measured at fair value at the grant date and recognized over the relevant vesting period in accordance with the ASC Topic 718 (“ASC 718”). Stock-based awards to nonemployees are recognized as a selling, general and administrative expense over the period of performance. Such awards are measured at fair value at the date of grant. In addition, for awards that vest immediately, the awards are measured at fair value and recognized in full at the grant date. The Company estimates the fair value of each stock-option award containing service and/or performance conditions on the grant date using the Black-Scholes option valuation model which incorporates assumptions as to stock price volatility, the expected life of the options, risk-free interest rate and dividend yield. The Company relies on its historical volatility as an input to the option pricing model as management believes that this rate will be representative of future volatility over the expected term of the options. The expected term until exercise represents the weighted-average period of time that options granted are expected to be outstanding giving consideration to vesting schedules and the Company’s historical exercise patterns. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant. The Company has not paid any dividends since its inception and does not anticipate paying any dividends for the foreseeable future, so the dividend yield is assumed to be zero. The Company estimates forfeitures of share-based awards at the time of grant and revises such estimates in subsequent periods if actual forfeitures differ from original estimates. Option awards are generally granted with an exercise price equal to the fair value of the Company’s common stock at the date of grant. Subsequent to the IPO, the fair value of the Company’s common stock underlying its equity awards is based on the quoted market price of the Company’s common stock on the grant date. Prior to the IPO, because there was no public market for the Company’s common stock, the fair value of the common stock underlying the stock awards has historically been determined at the time of grant of the stock option by considering a number of objective and subjective factors, including sales of shares of common stock, third-party valuations performed, important developments in the Company’s operations, actual operating results and financial performance, the conditions in the medical device industry and the economy in general, and the stock price performance, volatility of comparable public companies, and an assumption for a discount for lack of marketability, among other factors. |
Research and Development | Research and Development Research and development expense is comprised of in-house research and development of new products and technologies, clinical studies and trials, regulatory expenses, and employee related compensation and expenses. We maintain a procedurally focused approach to product development and have projects underway to add new products to our existing systems and to add new systems across multiple foot and ankle indications. |
Leases | At the inception of a contractual arrangement, the Company determines whether the contract contains a lease by assessing whether there is an identified asset and whether the contract conveys the right to control the use of the identified asset in exchange for consideration over a period of time. If both criteria are met, the Company calculates the associated lease liability and corresponding right-of-use asset upon lease commencement using a discount rate based on a borrowing rate commensurate with the term of the lease. The Company records lease liabilities within current liabilities or long-term liabilities based upon the length of time associated with the lease payments. The Company records its operating lease right-of-use assets within other assets. |
Contingencies | Contingencies A liability is contingent if the amount is not presently known but may become known in the future as a result of the occurrence of some uncertain future event. We accrue a liability for an estimated loss if we determine that the potential loss is probable of occurring and the amount can be reasonably estimated. Significant judgment is required in both the determination of probability and the determination as to whether the amount of an exposure is reasonably estimable, and accruals are based only on the information available to our management at the time the judgment is made. We expense legal costs, including those legal costs incurred in connection with a loss contingency, as incurred. |
Recently Adopted and Issued Accounting Pronouncements | Recently Adopted Accounting Pronouncements In December 2019, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("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 a llocations, 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. 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 Consolidated Financial Statements and related disclosures. In June 2016, the FASB issued 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. 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 Consolidated Financial Statements and related disclosures. Recently Issued Accounting Pronouncements In October 2023, the FASB issued Accounting Standards Update ASU 2023-06, Disclosure Improvements: Codification Amendments in Response to the SEC's Disclosure Update and Simplification Initiative. The amendments in ASU 2023-06 modify the disclosure or presentation requirements of a variety of Topics in the Codification. Certain of the amendments represent clarifications to or technical corrections of the current requirements. ASU 2023-06 is applicable to all entities subject to the SEC's existing disclosure requirements. The effective date for each amendment will be the date on which the SEC's removal of that related disclosure from Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited. The Company is currently evaluating the amendments in ASU 2023-06 and does not expect the adoption to have a significant impact on the Company's related disclosures. In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures ("ASU 2023-07"), which provides amendments to improve reportable segment disclosures requirements. The amendments in ASU 2023-07 are effective for fiscal years beginning after December 15, 2023, with early adoption permitted. The Company is currently evaluating the amendments in ASU 2023-07 and does not expect the adoption to have a significant impact on the Company's related disclosures. In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures ("ASU 2023-09"), to enhance the transparency and decision usefulness of income tax disclosures. The main provisions in ASU 2023-09 enhance the disclosure requirements of rate reconciliations and income taxes paid. For public business entities, the amendments in ASU 2023-09 are effective for annual periods beginning after December 15, 2024. Early adoption is permitted for annual financial statements that have not yet been issued or made available for issuance. The amendments in this update should be applied on a prospective basis, retrospective application is permitted. The Company is currently evaluating the amendments in this guidance to determine the impact it will have on the Company's Consolidated Financial Statements and related disclosures. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Schedule of Allowance for Doubtful Accounts | The following table presents the activity in the allowance for doubtful accounts for the years ended December 31, 2023 and 2022. December 31, 2023 2022 Allowance for doubtful accounts, beginning of year $ 1,688 $ 1,032 Additions charged against revenue or to expense 223 1,853 Write-offs ( 572 ) ( 1,197 ) Allowance for doubtful accounts, end of year $ 1,339 $ 1,688 |
Business Combinations (Tables)
Business Combinations (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Disior LTD. | |
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 Estimated Useful Life Developed technology $ 6,400 12 Tradenames 400 Indefinite Total intangible assets $ 6,800 |
Additive Orthopaedics, LLC | |
Business Acquisition [Line Items] | |
Summary of Purchase Consideration Transferred | Consideration Paid Cash consideration $ 15,000 Contingent consideration 2,870 Total consideration $ 17,870 |
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 Closing Date: Assets acquired: Accounts receivable $ 761 Inventory 113 Intangible assets 11,560 Goodwill 6,329 Total assets acquired 18,763 Liabilities assumed: Accounts payable 796 Accrued expenses 97 Total liabilities assumed 893 Net assets acquired $ 17,870 |
Useful Life Determination of Assets | below: Fair Value Estimated Useful Life Noncompete arrangements $ 30 3 Customer relationships 240 3 Developed technology 11,290 12 $ 11,560 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Summary of Property and Equipment | Property and equipment as of December 31, 2023 and 2022 consist of the following: Estimated Life December 31, (in years) 2023 2022 Surgical instrumentation 3 - 5 $ 60,100 $ 44,625 Land 3,625 3,625 Buildings 25 20,190 14,178 Leasehold improvements Various 8,307 7,961 Computer and software 3 - 5 16,546 11,562 Machinery and equipment 5 3,843 2,815 Office equipment and furniture 5 - 7 2,267 2,049 Construction in progress Various 288 5,817 Other 5 - 15 2,785 1,046 117,951 93,678 Less: accumulated depreciation ( 43,829 ) ( 31,740 ) Property and equipment, net $ 74,122 $ 61,938 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Indefinite lived and Finite Lived Intangible Assets | Intangible assets as of December 31, 2023 are as follows: Estimated Useful Life Gross Carrying Amount Accumulated Amortization Net Carrying Amount Trademarks and tradenames, indefinite-lived Indefinite $ 987 $ — $ 987 Patents, definite-lived 17.6 7,900 2,649 5,251 Customer relationships 3 - 7 1,733 567 1,165 Developed technology 12 17,690 3,424 14,267 Other intangibles 3 30 26 4 Total intangible assets, net $ 28,340 $ 6,666 $ 21,674 Intangible assets as of December 31, 2022, are as follows: Estimated Useful Life Gross Carrying Amount Accumulated Amortization Net Carrying Amount Trademarks, indefinite-lived Indefinite $ 901 $ — $ 901 Patents, definite-lived 16.5 6,671 2,370 4,301 Customer relationships 3 - 7 1,733 279 1,454 Developed technology 12 17,690 1,973 15,717 Other intangibles 3 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: 2024 $ 1,981 2025 1,940 2026 1,940 2027 1,940 2028 1,929 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Accrued Liabilities, Current [Abstract] | |
Summary of Accrued Expenses | Accrued expenses consist of the following as of December 31, 2023 and 2022, respectively: December 31, 2023 2022 Accrued commissions $ 6,126 $ 6,026 Accrued compensation 10,213 8,569 Accrued purchases 1,883 204 Accrued earnout payment 2,000 6,500 Accrued interest 2,006 450 Other accrued expenses 5,553 5,058 Total accrued expenses $ 27,781 $ 26,807 |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 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 December 31, 2023, were as follows: Level 1 Level 2 Level 3 Total Financial Assets: Interest rate swap $ — 991 — $ 991 Financial Liabilities: Contingent consideration $ — — 340 $ 340 |
Schedule of Reconciliation Level 3 Earn-out Liabilities | The following table provides a reconciliation of the Level 3 earn-out liabilities for the year ended December 31, 2023: Balance, December 31, 2022 $ 3,640 Achieved milestones paid ( 2,500 ) Achieved milestones reclassified to accrued expenses ( 1,000 ) Change in fair value of earn-out liabilities 200 Balance, December 31, 2023 340 |
Contingent Earn-Out Considerati
Contingent Earn-Out Consideration (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Business Combinations [Abstract] | |
Schedule of Reconciliation Level 3 Earn-out Liabilities | The following table provides a reconciliation of the Level 3 earn-out liabilities for the year ended December 31, 2023: Balance, December 31, 2022 $ 3,640 Achieved milestones paid ( 2,500 ) Achieved milestones reclassified to accrued expenses ( 1,000 ) Change in fair value of earn-out liabilities 200 Balance, December 31, 2023 340 |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | Long-term debt as of December 31, 2023, and December 31, 2022, consists of the following: December 31, 2023 December 31, 2022 Ares Revolving Loan $ 25,000 $ — Ares Term Loan 75,000 — MidCap Term Loan — 30,000 Zions Term Loan 14,933 15,573 Bank of Ireland Note Payable — 86 114,933 45,659 Less: deferred issuance costs ( 4,494 ) ( 2,749 ) Total debt, net of issuance costs 110,439 42,910 Less: current portion ( 640 ) ( 728 ) Long-term debt, net, less current maturities $ 109,799 $ 42,182 |
Schedule of Debt Maturities | The required principal payments for the Ares Revolving Loan, Ares Term Loan and the Zions Facility following the Consolidated Balance Sheet dates are as follows: 2024 $ 640 2025 640 2026 640 2027 640 2028 100,640 Thereafter 11,733 Total $ 114,933 |
Loss Per Share (Tables)
Loss Per Share (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Earnings Per Share [Abstract] | |
Summary of Computation of Net Loss Per Share | The computation of net loss per share for the years ended December 31, 2023, 2022 and 2021, respectively was as follows: Year Ended December 31, 2023 2022 2021 Net loss $ ( 47,841 ) $ ( 67,326 ) $ ( 13,693 ) Weighted-average common stock outstanding: Basic 82,087,329 76,766,100 52,916,711 Diluted 82,087,329 76,766,100 52,916,711 Loss per share: Basic $ ( 0.58 ) $ ( 0.88 ) $ ( 0.26 ) Diluted $ ( 0.58 ) $ ( 0.88 ) $ ( 0.26 ) |
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: December 31, 2023 2022 2021 Stock options 5,943,898 6,538,536 7,953,018 Restricted stock units 1,317,402 964,054 79,886 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Assumptions used in Determining Fair Value of Employee Stock Purchase Plan | Below are the assumptions used for the years ended December 31, 2023 and 2022 in determining the fair value of shares under the ESPP. Year Ended December 31, 2023 2022 Expected volatility 54.64 % 70.27 % Expected dividends — — Expected term (in years) 0.50 0.50 Discount rate 15.00 % 15.00 % Risk-free rate 5.26 % 2.79 % |
Assumptions used in Determining Fair Value of Stock Options | Below are the assumptions used for the years ended December 31, 2023, 2022 and 2021 in determining the fair value of each option award: Year Ended December 31, 2023 2022 2021 Expected volatility 66.20 % 55 % - 70 % 52 % - 55 % Expected dividends — — — Expected term (in years) 6.25 6.00 5.75 - 6.25 Risk-free rate 4.11 % 1.69 - 2.79 % 0.47 % - 1.20 % |
2011 and 2021 Plans | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Summary of Stock Option Activity | The following table summarizes the Company’s stock option plan and the activity for the year ended December 31, 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 ( 458,005 ) 6.56 Forfeited or expired ( 361,633 ) 15.29 Outstanding, December 31, 2023 5,943,898 $ 10.28 6.53 Exercisable, December 31, 2023 4,292,558 $ 8.51 6.02 Vested and expected to vest at December 31, 2023 5,938,438 $ 10.27 6.53 |
2021 Incentive Award Plan | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Summary of Restricted Stock Units Activity | The following table summarizes the Company's restricted stock units' activity for the years ended December 31, 2023. Year Ended December 31, 2023 Restricted Stock Units Weighted-Average Fair Value Outstanding, beginning of period 964,054 $ 17.74 Granted 776,359 16.56 Vested ( 273,618 ) 17.65 Forfeited or expired ( 149,393 ) 17.81 Outstanding, end of period 1,317,402 $ 17.06 Vested and expected to vest at end of period 1,305,827 $ 17.05 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Schedule of Provision (Benefit) Expense for Income Taxes | Total provision (benefit) for income taxes for the years ended December 31, 2023, 2022 and 2021: December 31, 2023 2022 2021 (Loss) income before taxes Domestic $ ( 46,650 ) $ ( 65,749 ) $ ( 17,030 ) Foreign ( 978 ) ( 1,641 ) 4,050 Total loss before taxes ( 47,628 ) ( 67,390 ) ( 12,980 ) Current tax expense (benefit): Federal 104 — ( 165 ) State 58 96 ( 36 ) Foreign 731 315 744 Total current tax expense 893 411 543 Deferred tax expense (benefit): Federal ( 9,273 ) ( 16,253 ) ( 3,506 ) State ( 1,177 ) ( 1,977 ) ( 464 ) Foreign ( 1,099 ) ( 909 ) 170 Change in valuation allowance 10,869 18,664 3,970 Total deferred tax (benefit) expense ( 680 ) ( 475 ) 170 Total tax (benefit) expense: Federal ( 9,169 ) ( 16,253 ) ( 3,671 ) State ( 1,119 ) ( 1,881 ) ( 500 ) Foreign ( 368 ) ( 594 ) 914 Change in valuation allowance 10,869 18,664 3,970 Total income tax expense (benefit) $ 213 $ ( 64 ) $ 713 The Company had an effective tax rate of ( 0.45 )% and 0.09 % for the years ended December 31, 2023 and 2022, respectively. Significant items that are impacting the rate include valuation allowance applied against domestic and certain foreign deferred tax assets (“DTA”), state taxes, permanent book tax difference for foreign sourced income and stock compensation, R&D Credit and FIN 48. A reconciliation of the provision for income taxes at the federal statutory rate compared to the effective tax rate for the years ended December 31, 2023, 2022 and 2021 is: 2023 2022 2021 Statutory U.S. federal tax rate $ ( 10,002 ) $ ( 14,152 ) $ ( 2,726 ) State taxes net of federal benefit ( 1,132 ) ( 1,901 ) ( 492 ) Non-U.S. earnings taxed at rates different than the U.S. statutory rate 5 ( 80 ) ( 150 ) Foreign source earnings, net of associated foreign tax credits 628 486 601 Benefit of tax credits ( 501 ) ( 458 ) ( 1,569 ) Stock based compensation 27 ( 2,852 ) ( 212 ) Change in valuation allowance 10,869 18,664 3,970 Change in unrecognized tax benefits 175 92 710 Other 144 137 581 Total provision (benefit) for income taxes $ 213 $ ( 64 ) $ 713 As of December 31, 2023 , our foreign operations held cash totaling $ 10,293 . We have not provided for a U.S. deferred tax liability or foreign withholding tax on the undistributed earnings from our non-U.S. subsidiaries that are considered to be indefinitely reinvested. If such earnings were to be distributed, any U.S. deferred tax liability or foreign withholding tax would not be significant. |
Schedule of Reconciliation of Provision for Income Taxes at Federal Statutory Rate | A reconciliation of the provision for income taxes at the federal statutory rate compared to the effective tax rate for the years ended December 31, 2023, 2022 and 2021 is: 2023 2022 2021 Statutory U.S. federal tax rate $ ( 10,002 ) $ ( 14,152 ) $ ( 2,726 ) State taxes net of federal benefit ( 1,132 ) ( 1,901 ) ( 492 ) Non-U.S. earnings taxed at rates different than the U.S. statutory rate 5 ( 80 ) ( 150 ) Foreign source earnings, net of associated foreign tax credits 628 486 601 Benefit of tax credits ( 501 ) ( 458 ) ( 1,569 ) Stock based compensation 27 ( 2,852 ) ( 212 ) Change in valuation allowance 10,869 18,664 3,970 Change in unrecognized tax benefits 175 92 710 Other 144 137 581 Total provision (benefit) for income taxes $ 213 $ ( 64 ) $ 713 |
Schedule of Significant Components of Deferred Taxes | Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of our deferred taxes as of December 31, 2023 and 2022 were: December 31, 2023 2022 Deferred tax assets: Receivable allowances $ 253 $ 356 Accrued expenses 1,262 5,351 S263A capitalizable costs 3,045 461 Inventory reserves 3,611 3,436 Research and development credits 3,974 3,615 Net operating losses 24,208 13,584 Interest expense 2,407 1,218 Stock-based compensation 4,496 3,324 Lease liability 356 384 R&D IRC 174(b) capitalized costs 5,161 3,433 Other 764 650 Total deferred tax assets 49,537 35,812 Valuation allowance ( 39,802 ) ( 28,933 ) Net deferred tax assets 9,735 6,879 Deferred tax liabilities: Property and equipment ( 6,807 ) ( 5,391 ) Section 481 adjustment ( 821 ) — Patents and trademarks ( 1,343 ) ( 1,304 ) Right of use asset ( 292 ) ( 378 ) Total deferred tax liabilities ( 9,263 ) ( 7,073 ) Total net deferred tax asset (liability) $ 472 $ ( 194 ) |
Schedule of Reconciliation of Unrecognized Tax Benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: 2023 2022 Gross unrecognized tax benefits - beginning of period $ 1,431 $ 1,337 Increases related to current year tax positions 92 92 Increases related to prior year tax positions — 2 Gross unrecognized tax benefits - end of period $ 1,523 $ 1,431 |
Segment and Geographic Inform_2
Segment and Geographic Information (Tables) | 12 Months Ended |
Dec. 31, 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 years ended December 31, 2023, 2022 and 2021, respectively. Year Ended December 31, 2023 2022 2021 United States $ 183,505 $ 158,105 $ 130,112 International 32,884 23,278 17,352 Total net revenue $ 216,389 $ 181,383 $ 147,464 |
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 for the years ended December 31, 2023 and 2022, respectively. December 31, 2023 December 31, 2022 United States $ 89,531 $ 79,458 Finland 25,032 25,581 Other International 9,617 6,546 Total assets $ 124,179 $ 111,585 |
Business and Basis of Present_2
Business and Basis of Presentation - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||||
Jan. 30, 2023 | Oct. 19, 2021 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Subsidiary, Sale of Stock [Line Items] | |||||
Net proceeds after deducting underwriting discounts and commissions | $ 129,384 | ||||
Net proceeds after deducting underwriting discounts and commissions | $ 68,453 | $ 68,453 | $ 1,001 | ||
Common Stock | |||||
Subsidiary, Sale of Stock [Line Items] | |||||
Number of aggregate issued | 6,500,000 | 4,312,500 | 0 | 151,515 | |
Price per share | $ 17 | ||||
Initial Public Offering | Common Stock | |||||
Subsidiary, Sale of Stock [Line Items] | |||||
Number of shares issued and sold | 8,984,375 | ||||
Public offering price per share | $ 16 | ||||
Net proceeds after deducting underwriting discounts and commissions | $ 133,688 | ||||
Offering expenses offset against proceeds | $ 4,304 | ||||
Number of shares issued upon conversion of convertible securities | 20,421,200 | ||||
Number of aggregate issued | 8,984,375 | ||||
Underwriters Option to Purchase Additional Shares | Maximum | |||||
Subsidiary, Sale of Stock [Line Items] | |||||
Number of shares issued and sold | 562,500 | ||||
Underwriters Option to Purchase Additional Shares | Common Stock | |||||
Subsidiary, Sale of Stock [Line Items] | |||||
Number of shares issued and sold | 412,500 | 1,171,875 | |||
Shares sold by Company | Common Stock | |||||
Subsidiary, Sale of Stock [Line Items] | |||||
Number of shares issued and sold | 3,750,000 | ||||
Selling securityholders | |||||
Subsidiary, Sale of Stock [Line Items] | |||||
Net proceeds after deducting underwriting discounts and commissions | $ 50,700 | ||||
Selling securityholders | Common Stock | |||||
Subsidiary, Sale of Stock [Line Items] | |||||
Number of shares issued and sold | 2,750,000 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Additional Information (Details) | 12 Months Ended | ||
Dec. 31, 2023 USD ($) Reporting | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Finite-Lived Intangible Assets [Line Items] | |||
Restricted cash | $ 1,000,000 | ||
Impairment of property and equipment | 0 | $ 0 | $ 0 |
Impairment of intangible asset, finite-lived | $ 0 | 0 | 0 |
Number of reporting units | Reporting | 1 | ||
Income tax likelihood percentage, description | more than 50 percent | ||
(Income) expenses for excess and obsolete inventory | $ (352,000) | 485,000 | $ 2,821,000 |
Inventory reserve | $ 16,532,000 | 16,804,000 | |
Capitalized amortization period | 1 year | ||
Revenue, practical expedient [true or false] | true | ||
Unbilled revenue | $ 5,598,000 | $ 4,511,000 | |
Additive Orthopaedics, LLC | Achievement of Milestone | |||
Finite-Lived Intangible Assets [Line Items] | |||
Restricted cash | $ 1,000,000 | ||
ASU 2016-13 | |||
Finite-Lived Intangible Assets [Line Items] | |||
Change in Accounting Principle, Accounting Standards Update, Adopted [true false] | true | ||
Change in Accounting Principle, Accounting Standards Update, Adoption Date | Jan. 01, 2023 | ||
Change in Accounting Principle, Accounting Standards Update, Immaterial Effect [true false] | true | ||
ASU 2019-12 | |||
Finite-Lived Intangible Assets [Line Items] | |||
Change in Accounting Principle, Accounting Standards Update, Adopted [true false] | true | ||
Change in Accounting Principle, Accounting Standards Update, Adoption Date | Jan. 01, 2023 | ||
Change in Accounting Principle, Accounting Standards Update, Immaterial Effect [true false] | true | ||
Minimum | |||
Finite-Lived Intangible Assets [Line Items] | |||
Useful life of assets | 3 years | ||
Maximum | |||
Finite-Lived Intangible Assets [Line Items] | |||
Useful life of assets | 25 years | ||
Patents | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization period | 17 years | ||
Developed Technology | |||
Finite-Lived Intangible Assets [Line Items] | |||
Estimated useful life | 12 years | 12 years | |
Customer Relationships | Minimum | |||
Finite-Lived Intangible Assets [Line Items] | |||
Estimated useful life | 3 years | 3 years | |
Customer Relationships | Maximum | |||
Finite-Lived Intangible Assets [Line Items] | |||
Estimated useful life | 7 years | 7 years | |
Other Intangibles | |||
Finite-Lived Intangible Assets [Line Items] | |||
Estimated useful life | 3 years | 3 years | |
Surgical Instrumentation | Minimum | |||
Finite-Lived Intangible Assets [Line Items] | |||
Useful life of assets | 3 years | ||
Surgical Instrumentation | Maximum | |||
Finite-Lived Intangible Assets [Line Items] | |||
Useful life of assets | 5 years |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Schedule of Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Accounting Policies [Abstract] | ||
Allowance for doubtful accounts, beginning of year | $ 1,688 | $ 1,032 |
Additions charged against revenue or to expense | 223 | 1,853 |
Write-offs | (572) | (1,197) |
Allowance for doubtful accounts, end of year | $ 1,339 | $ 1,688 |
Business Combinations - Additio
Business Combinations - Additional Information (Details) - USD ($) | 12 Months Ended | ||||
Jan. 10, 2022 | May 28, 2021 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Business Acquisition [Line Items] | |||||
Cash consideration | $ 18,504,000 | $ 15,000,000 | |||
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 | ||||
Cash consideration | 19,696,000 | ||||
Maximum earn out payment | 8,000,000 | ||||
Acquisition related costs | $ 0 | ||||
Business acquisition, pro forma information, description | There is no supplemental proforma presentation of operating results of the acquisition of Disior due to the immaterial impact on the Company’s Consolidated operations for the years ended December 31, 2022 and 2021. | ||||
Net assets acquired | 26,246,000 | ||||
Disior LTD. | Selling, General, and Administrative Expenses | |||||
Business Acquisition [Line Items] | |||||
Acquisition related costs | 761,000 | ||||
Disior LTD. | Term Loan | |||||
Business Acquisition [Line Items] | |||||
Proceeds from revolving credit facility | 20,000,000 | ||||
Disior LTD. | Measurement Period Adjustments | |||||
Business Acquisition [Line Items] | |||||
Aggregate purchase price of acquisition | $ 26,246,000 | ||||
Additive Orthopaedics, LLC | |||||
Business Acquisition [Line Items] | |||||
Aggregate purchase price of acquisition | $ 17,870,000 | ||||
Contingent earn-out consideration, estimated fair value | 2,870,000 | ||||
Cash consideration | 15,000,000 | ||||
Maximum earn out payment | 9,500,000 | ||||
Acquisition related costs | $ 0 | $ 0 | |||
Business acquisition, pro forma information, description | There is no supplemental proforma presentation of operating results of the acquisition of Additive due to the immaterial impact on the Company’s Consolidated operations for the years ended December 31, 2022 and 2021. | ||||
Net assets acquired | $ 17,870,000 | ||||
Additive Orthopaedics, LLC | Selling, General, and Administrative Expenses | |||||
Business Acquisition [Line Items] | |||||
Acquisition related costs | $ 822,000 |
Business Combinations - Summary
Business Combinations - Summary of Purchase Consideration Transferred (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Jan. 10, 2022 | May 28, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | |
Consideration paid | ||||
Cash consideration | $ 18,504 | $ 15,000 | ||
Disior LTD. | ||||
Consideration paid | ||||
Cash consideration | $ 19,696 | |||
Contingent consideration | 6,550 | |||
Total consideration | $ 26,246 | |||
Additive Orthopaedics, LLC | ||||
Consideration paid | ||||
Cash consideration | $ 15,000 | |||
Contingent consideration | 2,870 | |||
Total consideration | $ 17,870 |
Business Combinations - Summa_2
Business Combinations - Summary of Fair Values of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 | Jan. 10, 2022 | May 28, 2021 |
Assets acquired: | ||||
Goodwill | $ 25,465 | $ 25,465 | ||
Additive Orthopaedics, LLC | ||||
Assets acquired: | ||||
Accounts receivable | $ 761 | |||
Inventory | 113 | |||
Intangible assets | 11,560 | |||
Goodwill | 6,329 | |||
Total assets acquired | 18,763 | |||
Liabilities assumed: | ||||
Accounts payable | 796 | |||
Accrued expenses | 97 | |||
Total liabilities assumed | 893 | |||
Net assets acquired | $ 17,870 | |||
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 Combinations - Useful
Business Combinations - Useful Life Determination of Assets (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2023 USD ($) | |
Disior LTD. | |
Business Acquisition [Line Items] | |
Total intangible assets, Fair Value | $ 6,800 |
Additive Orthopaedics, LLC | |
Business Acquisition [Line Items] | |
Total intangible assets, Fair Value | 11,560 |
Tradenames | Disior LTD. | |
Business Acquisition [Line Items] | |
Total intangible assets, Fair Value | 400 |
Noncompete Arrangements | Additive Orthopaedics, LLC | |
Business Acquisition [Line Items] | |
Total intangible assets, Fair Value | $ 30 |
Estimated Useful Life (in years) | 3 years |
Customer Relationships | Additive Orthopaedics, LLC | |
Business Acquisition [Line Items] | |
Total intangible assets, Fair Value | $ 240 |
Estimated Useful Life (in years) | 3 years |
Developed Technology | Disior LTD. | |
Business Acquisition [Line Items] | |
Total intangible assets, Fair Value | $ 6,400 |
Estimated Useful Life (in years) | 12 years |
Developed Technology | Additive Orthopaedics, LLC | |
Business Acquisition [Line Items] | |
Total intangible assets, Fair Value | $ 11,290 |
Estimated Useful Life (in years) | 12 years |
Property and Equipment - Summar
Property and Equipment - Summary of Property and Equipment (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 117,951 | $ 93,678 |
Less: accumulated depreciation | (43,829) | (31,740) |
Property and equipment, net | $ 74,122 | 61,938 |
Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, estimated life | 3 years | |
Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, estimated life | 25 years | |
Surgical instrumentation | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 60,100 | 44,625 |
Surgical instrumentation | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, estimated life | 3 years | |
Surgical instrumentation | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, estimated life | 5 years | |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 3,625 | 3,625 |
Buildings | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 20,190 | 14,178 |
Property and equipment, estimated life | 25 years | |
Leasehold improvement | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 8,307 | 7,961 |
Property and equipment, estimated life | Various | |
Computer and software | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 16,546 | 11,562 |
Computer and software | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, estimated life | 3 years | |
Computer and software | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, estimated life | 5 years | |
Machinery and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 3,843 | 2,815 |
Property and equipment, estimated life | 5 years | |
Office equipment and furniture | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 2,267 | 2,049 |
Office equipment and furniture | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, estimated life | 5 years | |
Office equipment and furniture | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, estimated life | 7 years | |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 288 | 5,817 |
Property and equipment, estimated life | Various | |
Other | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 2,785 | $ 1,046 |
Other | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, estimated life | 5 years | |
Other | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, estimated life | 15 years |
Property and Equipment - Additi
Property and Equipment - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation expense | $ 13,515 | $ 10,824 | $ 7,615 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Finite-Lived Intangible Assets [Line Items] | |||
Goodwill | $ 25,465,000 | $ 25,465,000 | |
Impairment charges related to intangible assets | 0 | 0 | $ 0 |
Impairment charges related to goodwill | 0 | 0 | 0 |
Selling, General, and Administrative Expenses | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization expense | $ 2,027,000 | $ 2,904,000 | $ 1,372,000 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Schedule of Goodwill (Details) $ in Thousands | Dec. 31, 2023 USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Balance, December 31, 2021 | $ 25,465 |
Balance, December 31, 2022 | $ 25,465 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Indefinite Lived Intangible Assets By Major Class [Line Items] | ||
Gross Carrying Amount | $ 28,340 | $ 27,025 |
Accumulated Amortization | 6,666 | 4,638 |
Net Carrying Amount | 21,674 | 22,387 |
Trademarks and Tradenames, Indefinite-Lived | ||
Indefinite Lived Intangible Assets By Major Class [Line Items] | ||
Net Carrying Amount | $ 987 | $ 901 |
Patents, Definite-Lived | ||
Indefinite Lived Intangible Assets By Major Class [Line Items] | ||
Estimated Useful Life (in years) | 17 years 7 months 6 days | 16 years 6 months |
Gross Carrying Amount | $ 7,900 | $ 6,671 |
Accumulated Amortization | 2,649 | 2,370 |
Net Carrying Amount | 5,251 | 4,301 |
Customer Relationships | ||
Indefinite Lived Intangible Assets By Major Class [Line Items] | ||
Gross Carrying Amount | 1,733 | 1,733 |
Accumulated Amortization | 567 | 279 |
Net Carrying Amount | $ 1,165 | $ 1,454 |
Customer Relationships | Minimum | ||
Indefinite Lived Intangible Assets By Major Class [Line Items] | ||
Estimated Useful Life (in years) | 3 years | 3 years |
Customer Relationships | Maximum | ||
Indefinite Lived Intangible Assets By Major Class [Line Items] | ||
Estimated Useful Life (in years) | 7 years | 7 years |
Developed Technology | ||
Indefinite Lived Intangible Assets By Major Class [Line Items] | ||
Estimated Useful Life (in years) | 12 years | 12 years |
Gross Carrying Amount | $ 17,690 | $ 17,690 |
Accumulated Amortization | 3,424 | 1,973 |
Net Carrying Amount | $ 14,267 | $ 15,717 |
Other Intangibles | ||
Indefinite Lived Intangible Assets By Major Class [Line Items] | ||
Estimated Useful Life (in years) | 3 years | 3 years |
Gross Carrying Amount | $ 30 | $ 30 |
Accumulated Amortization | 26 | 16 |
Net Carrying Amount | $ 4 | $ 14 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Schedule of Expected Future Amortization Expense (Details) $ in Thousands | Dec. 31, 2023 USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2024 | $ 1,981 |
2025 | 1,940 |
2026 | 1,940 |
2027 | 1,940 |
2028 | $ 1,929 |
Accrued Expenses - Summary of A
Accrued Expenses - Summary of Accrued Expenses (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Accrued Liabilities, Current [Abstract] | ||
Accrued commissions | $ 6,126 | $ 6,026 |
Accrued compensation | 10,213 | 8,569 |
Accrued purchases | 1,883 | 204 |
Accrued earnout payment | 2,000 | 6,500 |
Accrued interest | 2,006 | 450 |
Other accrued expenses | 5,553 | 5,058 |
Total accrued expenses | $ 27,781 | $ 26,807 |
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 | Dec. 31, 2023 | Dec. 31, 2022 |
Financial Assets: | ||
Interest rate swap | $ 991 | |
Financial Liabilities: | ||
Contingent consideration | 340 | $ 3,640 |
Level 2 | ||
Financial Assets: | ||
Interest rate swap | 991 | |
Level 3 | ||
Financial Liabilities: | ||
Contingent consideration | $ 340 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments - Schedule of Reconciliation of Level 3 Earn-Out Liabilities (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2023 USD ($) | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |
Beginning Balance | $ 3,640 |
Achieved milestone paid | (2,500) |
Achieved milestones reclassified to accrued expenses | (1,000) |
Change in fair value of earn-out liabilities | 200 |
Ending Balance | $ 340 |
Fair Value of Financial Instr_5
Fair Value of Financial Instruments - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Interest rate swap | $ 991 | ||
Derivative Asset, Statement of Financial Position [Extensible Enumeration] | Other Assets | ||
Net increase (decrease) in estimate of earn-out liabilities | $ (791) | $ 1,280 | $ 440 |
Achieved milestones reclassified to accrued expenses | 1,000 | ||
Payments on earnout liability in cash | 8,000 | 1,000 | |
Other (expense) income | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Net increase (decrease) in estimate of earn-out liabilities | 200 | ||
Additive Orthopaedics, LLC | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Payments on earnout liability in cash | 500 | ||
Disior LTD. | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Payments on earnout liability in cash | 5,000 | ||
Accrued Expenses | Additive Orthopaedics, LLC | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Achieved milestones reclassified to accrued expenses | 1,000 | 1,500 | |
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. | Remaining Project Milestone | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Achieved milestones reclassified to accrued expenses | 1,000 | ||
Level 2 | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Interest rate swap | $ 991 |
Debt - Schedule of Long-term De
Debt - Schedule of Long-term Debt Instruments (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | ||
Debt, gross amount | $ 114,933 | $ 45,659 |
Less: deferred issuance costs | (4,494) | (2,749) |
Total debt, net of issuance costs | 110,439 | 42,910 |
Less: current portion | (640) | (728) |
Long-term debt net, less current maturities | 109,799 | 42,182 |
Ares Revolving Loan | ||
Debt Instrument [Line Items] | ||
Debt, gross amount | 25,000 | 0 |
Ares Term Loan | ||
Debt Instrument [Line Items] | ||
Debt, gross amount | 75,000 | 0 |
MidCap Term Loan | ||
Debt Instrument [Line Items] | ||
Debt, gross amount | 0 | 30,000 |
Zions Term Loan Facility | ||
Debt Instrument [Line Items] | ||
Debt, gross amount | 14,933 | 15,573 |
Bank of Ireland Note Payable | ||
Debt Instrument [Line Items] | ||
Debt, gross amount | $ 0 | $ 86 |
Debt - Ares Credit Agreement -
Debt - Ares Credit Agreement - Additional Information (Details) - USD ($) | 12 Months Ended | |||
Nov. 02, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Debt Instrument [Line Items] | ||||
Debt, gross amount | $ 114,933,000 | $ 45,659,000 | ||
Ares Credit Agreements [Member] | ||||
Debt Instrument [Line Items] | ||||
Expiration date | Nov. 02, 2028 | |||
indebtedness principal or stated amount | $ 12,500,000 | |||
Debt issuance cost before amortization | 4,275,000 | |||
Ares Credit Agreements [Member] | Interest Expense | ||||
Debt Instrument [Line Items] | ||||
Amortization expense | $ 147,000 | $ 0 | $ 0 | |
Ares Credit Agreements [Member] | Ares Term Loan | ||||
Debt Instrument [Line Items] | ||||
Total borrowing capacity | 100,000,000 | |||
Drew down value | $ 75,000,000 | |||
Ares Credit Agreements [Member] | Ares Term Loan | SOFR | ||||
Debt Instrument [Line Items] | ||||
Variable interest rate | 6.75% | |||
Ares Credit Agreements [Member] | Ares Revolving Loan | ||||
Debt Instrument [Line Items] | ||||
Drew down value | $ 25,000,000 | |||
Ares Credit Agreements [Member] | Ares Revolving Loan | Maximum | ||||
Debt Instrument [Line Items] | ||||
Total borrowing capacity | $ 50,000,000 | |||
Ares Credit Agreements [Member] | Ares Revolving Loan | SOFR | ||||
Debt Instrument [Line Items] | ||||
Variable interest rate | 4% | |||
Ares Credit Agreements [Member] | Revolving Loan | Secured Debt | ||||
Debt Instrument [Line Items] | ||||
Total borrowing capacity | $ 150,000,000 |
Debt - MidCap Credit Agreements
Debt - MidCap Credit Agreements - Additional Information (Details) - USD ($) | 12 Months Ended | ||||
Nov. 09, 2022 | May 06, 2021 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Debt Instrument [Line Items] | |||||
Debt, gross amount | $ 114,933,000 | $ 45,659,000 | |||
Loss on early extinguishment of debt | 5,308,000 | ||||
Total debt issuance costs | 4,494,000 | 2,749,000 | |||
MidCap Credit Agreements | |||||
Debt Instrument [Line Items] | |||||
Debt, gross amount | $ 70,000,000 | ||||
Loss on early extinguishment of debt | (5,308,000) | ||||
Unamortized debt issuance costs | 1,881,000 | ||||
Fees incurred to early exit of debt | 3,427,000 | ||||
MidCap Credit Agreements | Interest Expense | |||||
Debt Instrument [Line Items] | |||||
Amortization expense | $ 613,000 | $ 586,000 | $ 576,000 | ||
MidCap Credit Agreements | Term Loan | |||||
Debt Instrument [Line Items] | |||||
Debt, gross amount | $ 40,000,000 | ||||
MidCap Credit Agreements | Term Loan | LIBOR | |||||
Debt Instrument [Line Items] | |||||
Variable interest rate | 6% | ||||
MidCap Credit Agreements | Term Loan | SOFR | |||||
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 | LIBOR | |||||
Debt Instrument [Line Items] | |||||
Variable interest rate | 3% | 3% | |||
MidCap Credit Agreements | Revolving Loan | SOFR | |||||
Debt Instrument [Line Items] | |||||
Variable interest rate | 3.75% |
Debt - Vectra Bank Colorado Loa
Debt - Vectra Bank Colorado Loan Agreements - Additional Information (Details) - USD ($) | 12 Months Ended | ||||
Nov. 10, 2022 | Mar. 24, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Line Of Credit Facility [Line Items] | |||||
Total debt issuance costs | $ 4,494,000 | $ 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 | ||||
Amortization of debt issuance costs | 16,000 | $ 13,000 | $ 0 | ||
Threshold amount of operating cash flow to calculate liquidity ratio | $ 0 | ||||
Threshold Amount of Operating Cash Flow to Calculate Fixed Charge Coverage Ratio | $ 0 | ||||
Secured Term Loan Facility | SOFR | |||||
Line Of Credit Facility [Line Items] | |||||
Variable interest rate | 1.75% | ||||
Zions Facility | |||||
Line Of Credit Facility [Line Items] | |||||
Total debt issuance costs | $ 219,000 |
Debt - Bank of Ireland Note Pay
Debt - Bank of Ireland Note Payable - Additional Information (Details) - Bank of Ireland Note Payable - USD ($) | 12 Months Ended | |
Jun. 12, 2020 | Dec. 31, 2023 | |
Debt Instrument [Line Items] | ||
Principal amount | $ 474,000 | |
Interest rate | 4% | |
Debt payment terms | The Bank of Ireland Note Payable bore an annual interest rate of 4% and was due in equal monthly installments over a 36-month period, including interest. | |
Debt, frequency of payment | monthly | |
Debt instrument term | 36 months |
Debt - Schedule of Debt Maturit
Debt - Schedule of Debt Maturities (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | ||
Total debt, net of issuance costs | $ 110,439 | $ 42,910 |
Total | 114,933 | $ 45,659 |
Ares Revolving Loan, Ares Term Loan and Zions Facility | ||
Debt Instrument [Line Items] | ||
2024 | 640 | |
2025 | 640 | |
2026 | 640 | |
2027 | 640 | |
2028 | 100,640 | |
Thereafter | 11,733 | |
Total | $ 114,933 |
Convertible Preferred Series _2
Convertible Preferred Series Equity and Stockholders Equity - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | |||||||||
Jan. 30, 2023 | Oct. 19, 2021 | Jul. 31, 2020 | Nov. 30, 2012 | Feb. 29, 2012 | Dec. 31, 2011 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Oct. 31, 2021 | Oct. 08, 2021 | |
Class of Stock [Line Items] | |||||||||||
Options reserved for future grants | 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 | ||||||||||
Common stock, voting rights, description | Each holder of common stock is entitled to one vote for each share owned on all matters voted upon by the stockholders, and a majority vote is required for all actions taken by stockholders. | ||||||||||
Issuance costs | $ 827 | ||||||||||
Treasury stock repurchase shares | 0 | 0 | 85,049 | ||||||||
Treasury stock repurchase value | $ 561 | ||||||||||
Average cost per share | $ 6.60 | ||||||||||
Net proceeds after deducting underwriting discounts and commissions | $ 68,453 | $ 68,453 | $ 1,001 | ||||||||
Common Stock | |||||||||||
Class of Stock [Line Items] | |||||||||||
Number of aggregate issued | 6,500,000 | 4,312,500 | 0 | 151,515 | |||||||
Price per share | $ 17 | ||||||||||
Initial Public Offering | |||||||||||
Class of Stock [Line Items] | |||||||||||
Issuance costs | $ 4,304 | ||||||||||
Initial Public Offering | Common Stock | |||||||||||
Class of Stock [Line Items] | |||||||||||
Number of aggregate issued | 8,984,375 | ||||||||||
Conversion of shares | 20,421,200 | ||||||||||
Number of shares issued and sold | 8,984,375 | ||||||||||
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 | 1,171,875 | |||||||||
Series A Convertible Preferred Stock | |||||||||||
Class of Stock [Line Items] | |||||||||||
Number of aggregate issued | 10,562,495 | 10,562,495 | 3,250,005 | ||||||||
Proceeds from issuance of convertible preferred stock | $ 3,250 | $ 3,250 | $ 1,000 | ||||||||
Price per share | $ 0.30769 | $ 0.30769 | $ 0.30769 | ||||||||
Series A Convertible Preferred Stock | Initial Public Offering | Common Stock | |||||||||||
Class of Stock [Line Items] | |||||||||||
Conversion of shares | 13,812,500 | ||||||||||
Series B Convertible Preferred Stock | |||||||||||
Class of Stock [Line Items] | |||||||||||
Number of aggregate issued | 6,608,700 | ||||||||||
Proceeds from issuance of convertible preferred stock | $ 36,030 | ||||||||||
Cash dividends accrued | $ 2,328 | ||||||||||
Issuance costs | $ 1,970 | ||||||||||
Price per share | $ 5.75 | ||||||||||
Series B Convertible Preferred Stock | Initial Public Offering | Common Stock | |||||||||||
Class of Stock [Line Items] | |||||||||||
Conversion of shares | 6,608,700 |
Loss Per Share - Summary of Com
Loss Per Share - Summary of Computation of Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Net loss attributable to common stockholders | |||
Net loss | $ (47,841) | $ (67,326) | $ (13,693) |
Weighted-average common stock outstanding: | |||
Basic | 82,087,329 | 76,766,100 | 52,916,711 |
Diluted | 82,087,329 | 76,766,100 | 52,916,711 |
Loss per share, Basic: | |||
Basic | $ (0.58) | $ (0.88) | $ (0.26) |
Loss per share, Diluted: | |||
Diluted | $ (0.58) | $ (0.88) | $ (0.26) |
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 | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
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 | 5,943,898 | 6,538,536 | 7,953,018 |
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 | 1,317,402 | 964,054 | 79,886 |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Details) - USD ($) | 12 Months Ended | |||
Oct. 19, 2021 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Options granted | 225,000 | 359,054 | 3,467,069 | |
Cash received from exercise of stock options | $ 2,406,000 | $ 5,271,000 | $ 445,000 | |
Employee contribution percentage | 100% | |||
Weighted average strike price | $ 18.33 | $ 16.08 | $ 14.63 | |
2021 Incentive Award Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Options reserved for future grant | 13,510,971 | |||
Percentage of shares issued from outstanding number of shares | 5% | |||
2021 Incentive Award Plan | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock options permitted to grant | 7,641,979 | |||
Employee Stock Purchase Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Market price of shares authorized percentage | 85% | |||
Shares issued | 73,442 | 38,968 | 0 | |
Shares available for issuance | 2,758,808 | |||
Employee contribution percentage | 15% | |||
Maximum purchase value of shares available for each employee | $ 25,000,000 | |||
Compensation expense | 322,000 | $ 213,000 | $ 0 | |
Percentage of shares issued from outstanding number of shares | 1% | |||
Employee Stock Purchase Plan | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Stock options permitted to grant | 1,329,040 | |||
Employee Stock Option | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Cash received from exercise of stock options | 2,406,000 | 5,271,000 | 445,000 | |
Tax benefit from equity options exercised | 560,000 | 1,223,000 | 93,000 | |
Compensation expense | 5,542,000 | 500,000 | 4,863,000 | |
Aggregate intrinsic value of options outstanding | 22,900,000 | |||
Aggregate intrinsic value of vested and exercisable options | 21,530,000 | |||
Aggregate intrinsic value of options exercised | 4,742,000 | 18,764,000 | 3,743,000 | |
Total unrecognized compensation cost related to non-vested stock awards | $ 5,634,000 | |||
Total unrecognized compensation cost related to non-vested stock awards, weighted average recognition period | 1 year 9 months 10 days | |||
Restricted Stock Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Compensation expense | $ 6,822,000 | $ 1,865,000 | $ 85,000 | |
Total unrecognized compensation cost related to non-vested stock awards | $ 18,689,000 | |||
Total unrecognized compensation cost related to non-vested stock awards, weighted average recognition period | 2 years 10 months 17 days | |||
Restricted Stock Units | 2021 Incentive Award Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Contractual term | 10 years | |||
Vesting, description | RSUs granted under the 2021 Plan have a ten-year contractual term and typically vest over a three or four-year period, contingent upon continued service with the Company. | |||
Number of shares granted | 776,359 | 929,090 | 79,886 | |
Number of days grant date fair value for RSUs is trailing average market price of the common stock | 30 days | |||
Vested | 273,618 | |||
Forfeited | 149,393 | |||
Restricted Stock Units | 2021 Incentive Award Plan | Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 3 years | |||
Restricted Stock Units | 2021 Incentive Award Plan | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period | 4 years |
Stock-Based Compensation - Assu
Stock-Based Compensation - Assumptions used in Determining Fair Value (Details) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Employee Stock Option | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Expected volatility | 66.20% | ||
Expected volatility, minimum | 55% | 52% | |
Expected volatility, maximum | 70% | 55% | |
Expected dividends | 0% | 0% | 0% |
Expected term (in years) | 6 years 3 months | ||
Risk-free rate | 4.11% | ||
Risk-free rate, minimum | 1.69% | 0.47% | |
Risk-free rate, maximum | 2.79% | 1.20% | |
Employee Stock Option | Minimum | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Expected term (in years) | 6 years | 5 years 9 months | |
Employee Stock Option | Maximum | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Expected term (in years) | 6 years 3 months | ||
Employee Stock Purchase Plan | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Expected volatility | 54.64% | 70.27% | |
Expected dividends | 0% | 0% | |
Expected term (in years) | 6 months | 6 months | |
Discount rate | 15% | 15% | |
Risk-free rate | 5.26% | 2.79% |
Stock-Based Compensation - Summ
Stock-Based Compensation - Summary of Stock Option Activity (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Shares, Granted | 225,000 | 359,054 | 3,467,069 |
Weighted-Average Exercise Price, Beginning Balance | $ 16.08 | $ 14.63 | |
Weighted-Average Exercise Price, Ending Balance | $ 18.33 | $ 16.08 | $ 14.63 |
2011 and 2021 Plans | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Shares Outstanding, Beginning Balance | 6,538,536 | ||
Shares, Granted | 225,000 | ||
Shares, Exercised or Released | (458,005) | ||
Shares, Forfeited or Expired | (361,633) | ||
Shares Outstanding, Ending Balance | 5,943,898 | 6,538,536 | |
Shares, Exercisable | 4,292,558 | ||
Shares, Vested and Expected To Vest | 5,938,438 | ||
Weighted-Average Exercise Price, Beginning Balance | $ 10.02 | ||
Weighted-Average Exercise Price, Granted | 18.33 | ||
Weighted-Average Exercise Price, Exercised or Released | 6.56 | ||
Weighted-Average Exercise Price, Forfeited or Expired | 15.29 | ||
Weighted-Average Exercise Price, Ending Balance | 10.28 | $ 10.02 | |
Weighted-Average Exercise Price, Exercisable | 8.51 | ||
Weighted-Average Exercise Price, Vested and Expected To Vest | $ 10.27 | ||
Weighted-Average Remaining Contractual Term (Years) | 6 years 6 months 10 days | 7 years 4 months 9 days | |
Weighted-Average Remaining Contractual Term (Years), Exercisable | 6 years 7 days | ||
Weighted-Average Remaining Contractual Term (Years), Vested and expected to vest | 6 years 6 months 10 days |
Stock-Based Compensation - Sche
Stock-Based Compensation - Schedule of RSU Activity (Details) - Restricted Stock Units - 2021 Plans - $ / shares | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Outstanding, Beginning balance | 964,054 | ||
Granted | 776,359 | 929,090 | 79,886 |
Vested | (273,618) | ||
Forfeited or expired | (149,393) | ||
Outstanding, Ending balance | 1,317,402 | 964,054 | |
Vested and expected to vest | 1,305,827 | ||
Weighted Average Fair Value, Beginning balance | $ 17.74 | ||
Weighted Average Fair Value, Granted | 16.56 | ||
Weighted Average Fair Value, Vested | 17.65 | ||
Weighted Average Fair Value, Forfeited or expired | 17.81 | ||
Weighted Average Fair Value, Ending balance | 17.06 | $ 17.74 | |
Weighted Average Fair Value, Vested and expected to vest | $ 17.05 |
Employee Benefit Plan - Additio
Employee Benefit Plan - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Retirement Benefits [Abstract] | |||
Defined contribution plan, description | The Company sponsors a defined contribution plan for eligible employees who are 21 years of age with three months of service can voluntarily contribute up to 100% of their eligible compensation. | ||
Defined contribution plan minimum annual contributions per employee percent | 3% | ||
Defined benefit plan, plan assets, contributions by employer | $ 1,190 | $ 992 | $ 633 |
Defined contribution plan, maximum percentage of eligible compensation for voluntary contribution | 100% |
Income Taxes - Schedule of Prov
Income Taxes - Schedule of Provision (Benefit) Expense for Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Pre-tax (loss) / income | |||
Domestic | $ (46,650) | $ (65,749) | $ (17,030) |
Foreign | (978) | (1,641) | 4,050 |
Loss before income taxes | (47,628) | (67,390) | (12,980) |
Current tax expense / (benefit): | |||
Federal | 104 | (165) | |
State | 58 | 96 | (36) |
Foreign | 731 | 315 | 744 |
Total current tax expense | 893 | 411 | 543 |
Deferred tax expense / (benefit): | |||
Federal | (9,273) | (16,253) | (3,506) |
State | (1,177) | (1,977) | (464) |
Foreign | (1,099) | (909) | 170 |
Change in valuation allowance | 10,869 | 18,664 | 3,970 |
Total deferred tax (benefit) expense | (680) | (475) | 170 |
Total tax expense (benefit): | |||
Federal | (9,169) | (16,253) | (3,671) |
State | (1,119) | (1,881) | (500) |
Foreign | (368) | (594) | 914 |
Change in valuation allowance | 10,869 | 18,664 | 3,970 |
Total income tax (benefit) expense | $ 213 | $ (64) | $ 713 |
Income Taxes - Schedule of Reco
Income Taxes - Schedule of Reconciliation of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Income Tax Disclosure [Abstract] | |||
Statutory U.S. federal tax rate | $ (10,002) | $ (14,152) | $ (2,726) |
State taxes net of federal benefit | (1,132) | (1,901) | (492) |
Non-U.S. earnings taxed at rates different than the U.S. statutory rate | 5 | (80) | (150) |
Foreign source earnings, net of associated foreign tax credits | 628 | 486 | 601 |
Benefit of tax credits | (501) | (458) | (1,569) |
Stock based compensation | 27 | (2,852) | (212) |
Change in valuation allowance | 10,869 | 18,664 | 3,970 |
Change in unrecognized tax benefits | 175 | 92 | 710 |
Other | 144 | 137 | 581 |
Total income tax (benefit) expense | $ 213 | $ (64) | $ 713 |
Income Taxes - Schedule of Sign
Income Taxes - Schedule of Significant Components of Deferred Taxes (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Deferred tax assets: | ||
Receivable allowances | $ 253 | $ 356 |
Accrued expenses | 1,262 | 5,351 |
S263A capitalizable costs | 3,045 | 461 |
Inventory reserves | 3,611 | 3,436 |
Research and development credits | 3,974 | 3,615 |
Net operating losses | 24,208 | 13,584 |
Interest expense | 2,407 | 1,218 |
Stock-based compensation | 4,496 | 3,324 |
Lease liability | 356 | 384 |
R&D IRC 174(b) capitalized costs | 5,161 | 3,433 |
Other | 764 | 650 |
Total deferred tax assets | 49,537 | 35,812 |
Valuation allowance | (39,802) | (28,933) |
Net deferred tax assets | 9,735 | 6,879 |
Deferred tax liabilities: | ||
Property and equipment | (6,807) | (5,391) |
Section 481 adjustment | (821) | |
Patents and trademarks | (1,343) | (1,304) |
Right of use asset | (292) | (378) |
Total deferred tax liabilities | (9,263) | (7,073) |
Total net deferred tax asset (liability) | $ 472 | |
Total net deferred tax asset (liability) | $ (194) |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Operating Loss Carryforwards [Line Items] | ||
Valuation allowance | $ 39,802 | $ 28,933 |
Unrecognized tax benefits | 1,523 | |
Unrecognized tax benefits, income tax penalties and interest expense | $ 106 | |
Effective tax rate | (0.45%) | 0.09% |
Cash | $ 75,639 | $ 38,468 |
U.S, Germany, Finland and Italy | ||
Operating Loss Carryforwards [Line Items] | ||
Valuation allowance | 39,802 | |
U.S, Germany and Italy | ||
Operating Loss Carryforwards [Line Items] | ||
Valuation allowance | 28,933 | |
U.S Federal | ||
Operating Loss Carryforwards [Line Items] | ||
Net operating loss carryforwards | $ 93,341 | $ 52,349 |
Net operating loss carryforwards, expiration description | indefinite | indefinite |
U.S State | ||
Operating Loss Carryforwards [Line Items] | ||
Net operating loss carryforwards | $ 52,362 | |
Net operating loss carryforwards, expiration year | 2033 | |
Foreign | ||
Operating Loss Carryforwards [Line Items] | ||
Net operating loss carryforwards | $ 10,368 | |
Net operating loss carryforwards, expiration year | 2034 | |
Cash | $ 10,293 |
Income Taxes - Schedule of Re_2
Income Taxes - Schedule of Reconciliation of Provision for Income Taxes at Federal Statutory Rate (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | ||
Gross unrecognized tax benefits - beginning of period | $ 1,431 | $ 1,337 |
Increases related to current year tax positions | 92 | 92 |
Increases related to prior year tax positions | 2 | |
Gross unrecognized tax benefits - end of period | $ 1,523 | $ 1,431 |
Commitments And Contigencies -
Commitments And Contigencies - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Nov. 28, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Loss Contingencies [Line Items] | ||||
Lease liability | $ 1,821 | |||
Operating Lease, Liability, Statement of Financial Position [Extensible Enumeration] | Other Liabilities | |||
Right-of-use asset | $ 1,533 | $ 1,795 | ||
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Other Assets | Other Assets | ||
Short-term lease liabilities | $ 543 | $ 447 | ||
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Other Liabilities, Current | Other Liabilities, Current | ||
Long-term lease liabilities | $ 1,048 | $ 1,374 | ||
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Other Liabilities, Noncurrent | Other Liabilities, Noncurrent | ||
Lease expense | $ 574 | $ 408 | ||
Lease expiration year | 2029 | |||
Rent expense under operating leases | $ 1,369 | |||
Settlement Agreement | Stryker Corp. | ||||
Loss Contingencies [Line Items] | ||||
Settlement amount | $ 26,000 | |||
Legal fees | 1,000 | |||
Settlement Agreement | Stryker Corp. | First Installment to be Paid, On or by December 16, 2022 | ||||
Loss Contingencies [Line Items] | ||||
Settlement amount | 5,000 | |||
Settlement Agreement | Stryker Corp. | Second Installment to be Paid, January 1, 2023 - January 16, 2023 | ||||
Loss Contingencies [Line Items] | ||||
Settlement amount | 8,000 | |||
Settlement Agreement | Stryker Corp. | Third Installment to be Paid, April 1, 2023 - April 17, 2023 | ||||
Loss Contingencies [Line Items] | ||||
Settlement amount | $ 13,000 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Related Party Transaction [Line Items] | |||
Payments to related party | $ 43,598 | $ 32,457 | $ 28,024 |
Due to related parties | 883 | 3,844 | |
Selling, general and administrative expenses from transactions with related party | $ 180,022 | 159,323 | 114,087 |
Director | License Agreement | |||
Related Party Transaction [Line Items] | |||
Percentage of revenue paid as royalty | 4% | ||
Royalty estimated useful life | 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 | $ 16 | 0 | |
Payments to related party | 269 | 249 | 87 |
Due to related parties | 155 | 164 | |
Selling, general and administrative expenses from transactions with related party | 327 | $ 405 | $ 542 |
Annual Payment Threshold | Minimum | Director | Related Party | License Agreement | |||
Related Party Transaction [Line Items] | |||
Due to related parties | $ 250 |
Segment and Geographic Inform_3
Segment and Geographic Information - Additional Information - (Details) | 12 Months Ended | ||
Dec. 31, 2023 Customer Country | Dec. 31, 2022 Country Customer | Dec. 31, 2021 Country | |
Segment Reporting Information [Line Items] | |||
Number of customers accounted for more than ten percent of total product sales | 0 | 0 | |
Number of customers accounted for more than ten percent of consolidated accounts receivable | 0 | 0 | |
International | |||
Segment Reporting Information [Line Items] | |||
Number of countries accounted more than ten percent of net revenue | Country | 0 | 0 | 0 |
Segment and Geographic Inform_4
Segment and Geographic Information - Schedule of Total Net Revenue by Geographic Area (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Segment Reporting Information [Line Items] | |||
Total net revenue | $ 216,389 | $ 181,383 | $ 147,464 |
United States | |||
Segment Reporting Information [Line Items] | |||
Total net revenue | 183,505 | 158,105 | 130,112 |
International | |||
Segment Reporting Information [Line Items] | |||
Total net revenue | $ 32,884 | $ 23,278 | $ 17,352 |
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 | Dec. 31, 2023 | Dec. 31, 2022 |
Segment Reporting Information [Line Items] | ||
Total assets | $ 124,179 | $ 111,585 |
United States | ||
Segment Reporting Information [Line Items] | ||
Total assets | 89,531 | 79,458 |
Finland | ||
Segment Reporting Information [Line Items] | ||
Total assets | 25,032 | 25,581 |
Other International | ||
Segment Reporting Information [Line Items] | ||
Total assets | $ 9,617 | $ 6,546 |
Subsequent Events - Additional
Subsequent Events - Additional Information - (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||||
Jan. 30, 2023 | Oct. 19, 2021 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Subsequent Event [Line Items] | |||||
Net proceeds after deducting underwriting discounts and commissions | $ 68,453 | $ 68,453 | $ 1,001 | ||
Common Stock | |||||
Subsequent Event [Line Items] | |||||
Number of aggregate issued | 6,500,000 | 4,312,500 | 0 | 151,515 | |
Price per share | $ 17 | ||||
Underwriters Option to Purchase Additional Shares | Maximum | |||||
Subsequent Event [Line Items] | |||||
Number of shares issued and sold | 562,500 | ||||
Underwriters Option to Purchase Additional Shares | Common Stock | |||||
Subsequent Event [Line Items] | |||||
Number of shares issued and sold | 412,500 | 1,171,875 |