Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Feb. 15, 2018 | Jun. 30, 2017 | |
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2017 | ||
Document Fiscal Year Focus | 2,017 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | RGEN | ||
Entity Registrant Name | REPLIGEN CORP | ||
Entity Central Index Key | 730,272 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 43,588,469 | ||
Entity Public Float | $ 1,225,041,904 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 173,759 | $ 122,233 |
Marketable securities | 19,547 | |
Accounts receivable, less reserve for doubtful accounts of $58 and $23, respectively | 27,585 | 15,194 |
Royalties and other receivables | 153 | 839 |
Inventories, net | 39,004 | 24,696 |
Prepaid expenses and other current assets | 2,281 | 1,644 |
Total current assets | 242,782 | 184,153 |
Property, plant and equipment, net | 22,417 | 14,956 |
Intangible assets, net | 144,753 | 29,806 |
Goodwill | 327,333 | 59,548 |
Restricted Cash | 450 | |
Other assets | 6,234 | |
Total assets | 743,519 | 288,913 |
Current liabilities: | ||
Accounts payable | 7,282 | 5,061 |
Accrued liabilities | 17,929 | 16,014 |
Total current liabilities | 25,211 | 21,075 |
Convertible senior notes, net | 99,250 | 95,272 |
Deferred tax liabilities | 25,167 | 2,103 |
Other long-term liabilities | 2,343 | 1,699 |
Commitments and contingencies (Note 6) | ||
Stockholders' equity: | ||
Preferred stock, $.01 par value, 5,000,000 shares authorized, no shares issued or outstanding | ||
Common stock, $.01 par value, 80,000,000 shares authorized, 43,587,079 shares at December 31, 2017 and 33,844,074 shares at December 31, 2016 issued and outstanding | 436 | 338 |
Additional paid-in capital | 628,983 | 242,036 |
Accumulated other comprehensive loss | (6,363) | (13,749) |
Accumulated deficit | (31,508) | (59,861) |
Total stockholders' equity | 591,548 | 168,764 |
Total liabilities and stockholders' equity | $ 743,519 | $ 288,913 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Accounts receivable, reserve for doubtful accounts | $ 58 | $ 23 |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 80,000,000 | 80,000,000 |
Common stock, shares issued | 43,587,079 | 33,844,074 |
Common stock, shares outstanding | 43,587,079 | 33,844,074 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Revenue: | |||
Product revenue | $ 141,089 | $ 104,441 | $ 83,537 |
Royalty and other revenue | 147 | 100 | |
Total revenue | 141,236 | 104,541 | 83,537 |
Operating expenses: | |||
Cost of product revenue | 67,050 | 47,117 | 35,251 |
Research and development | 8,672 | 7,355 | 5,740 |
Selling, general and administrative | 51,509 | 30,853 | 24,699 |
Contingent consideration - fair value adjustments | 3,242 | 4,083 | |
Total operating expenses | 127,231 | 88,567 | 69,773 |
Income from operations | 14,005 | 15,974 | 13,764 |
Investment income | 371 | 346 | 136 |
Interest expense | (6,441) | (3,768) | (32) |
Other income (expense) | (687) | (860) | (445) |
Income before income taxes | 7,248 | 11,692 | 13,423 |
Income tax provision (benefit) | (21,105) | 11 | 4,078 |
Net income | $ 28,353 | $ 11,681 | $ 9,345 |
Earnings per share: | |||
Basic | $ 0.74 | $ 0.35 | $ 0.28 |
Diluted | $ 0.72 | $ 0.34 | $ 0.28 |
Weighted average shares outstanding: | |||
Basic | 38,233,527 | 33,572,883 | 32,881,940 |
Diluted | 39,150,374 | 34,098,898 | 33,577,091 |
Other comprehensive income: | |||
Unrealized gain (loss) on investments | $ 5 | $ 6 | $ 22 |
Foreign currency translation gain (loss) | 7,381 | (5,189) | (2,815) |
Comprehensive income | $ 35,739 | $ 6,498 | $ 6,552 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit |
Balance (in shares) at Dec. 31, 2014 | 32,774,374 | ||||
Balance at Dec. 31, 2014 | $ 111,732 | $ 328 | $ 198,064 | $ (5,773) | $ (80,887) |
Net income | 9,345 | 9,345 | |||
Unrealized gain on investments | 22 | 22 | |||
Foreign currency translation adjustment, net | (2,815) | (2,815) | |||
Share-based compensation expense | 3,598 | 3,598 | |||
Exercise of stock options and vesting of restricted stock | 866 | $ 1 | 865 | ||
Exercise of stock options and vesting of restricted stock (in shares) | 174,979 | ||||
Balance (in shares) at Dec. 31, 2015 | 32,949,353 | ||||
Balance at Dec. 31, 2015 | 122,748 | $ 329 | 202,527 | (8,566) | (71,542) |
Net income | 11,681 | 11,681 | |||
Unrealized gain on investments | 6 | 6 | |||
Shares issued in acquisition (in shares) | 538,700 | ||||
Shares issued in acquisition | 14,135 | $ 5 | 14,130 | ||
Payment of contingent consideration in stock | 875 | 875 | |||
Payment of contingent consideration in stock (in shares) | 34,803 | ||||
Conversion option of convertible notes, net of issuance costs of $639,000 | 18,072 | 18,072 | |||
Foreign currency translation adjustment, net | (5,189) | (5,189) | |||
Share-based compensation expense | 4,595 | 4,595 | |||
Exercise of stock options and vesting of restricted stock | 1,841 | $ 4 | 1,837 | ||
Exercise of stock options and vesting of restricted stock (in shares) | 321,218 | ||||
Balance (in shares) at Dec. 31, 2016 | 33,844,074 | ||||
Balance at Dec. 31, 2016 | 168,764 | $ 338 | 242,036 | (13,749) | (59,861) |
Net income | 28,353 | 28,353 | |||
Unrealized gain on investments | 5 | 5 | |||
Shares issued in acquisition (in shares) | 6,153,995 | ||||
Shares issued in acquisition | 247,575 | $ 62 | 247,513 | ||
Payment of contingent consideration in stock | 1,063 | $ 1 | 1,062 | ||
Payment of contingent consideration in stock (in shares) | 30,756 | ||||
Proceeds from issuance of common stock | 129,309 | $ 32 | 129,277 | ||
Proceeds from issuance of common stock (in shares) | 3,228,069 | ||||
Foreign currency translation adjustment, net | 7,381 | 7,381 | |||
Share-based compensation expense | 6,747 | 6,747 | |||
Exercise of stock options and vesting of restricted stock | 2,351 | $ 3 | 2,348 | ||
Exercise of stock options and vesting of restricted stock (in shares) | 330,185 | ||||
Balance (in shares) at Dec. 31, 2017 | 43,587,079 | ||||
Balance at Dec. 31, 2017 | $ 591,548 | $ 436 | $ 628,983 | $ (6,363) | $ (31,508) |
CONSOLIDATED STATEMENTS OF STO6
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Conversion option of convertible notes, issuance costs | $ 8,691,000 | $ 639,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Cash flows from operating activities: | |||
Net income: | $ 28,353 | $ 11,681 | $ 9,345 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 10,507 | 5,334 | 4,594 |
Non-cash interest expense | 3,977 | 2,274 | |
Stock-based compensation expense | 6,747 | 4,595 | 3,598 |
Deferred tax benefit | (24,679) | (4,092) | (118) |
Loss on revaluation of contingent consideration | 3,242 | 4,083 | |
Gain on sale of fixed assets | (15) | ||
Loss on disposal of assets | 64 | 7 | 1 |
Changes in assets and liabilities: | |||
Accounts receivable | (6,888) | (3,222) | (3,729) |
Royalties and other receivables | 644 | (652) | 158 |
Inventories | 605 | (6,163) | (6,149) |
Prepaid expenses and other assets | (1,304) | 612 | (277) |
Accounts payable | 807 | (1,802) | 3,024 |
Accrued liabilities | (1,993) | (4,038) | (1,592) |
Long-term liabilities | 611 | (240) | 2,115 |
Net cash provided by operating activities | 17,451 | 7,521 | 15,053 |
Cash flows from investing activities: | |||
Purchases of marketable securities | (47) | (23,700) | (20,168) |
Redemptions of marketable securities | 19,600 | 23,400 | 27,587 |
Decrease of restricted cash | 450 | ||
Proceeds from sale of fixed assets | 45 | ||
Purchases of property, plant and equipment | (5,454) | (4,325) | (2,628) |
Net cash provided by (used in) investing activities | (98,246) | (49,194) | 4,791 |
Cash flows from financing activities: | |||
Proceeds from issuance of senior convertible notes, net of issuance costs | 111,070 | ||
Proceeds from issuance of common stock, net of issuance costs | 129,309 | ||
Exercise of stock options | 2,351 | 1,841 | 866 |
Payments of contingent consideration | (1,715) | (798) | (99) |
Net cash provided by financing activities | 129,945 | 112,113 | 767 |
Effect of exchange rate changes on cash and cash equivalents | 2,376 | (2,299) | (1,882) |
Net increase (decrease) in cash and cash equivalents | 51,526 | 68,141 | 18,729 |
Cash and cash equivalents, beginning of period | 122,233 | 54,092 | 35,363 |
Cash and cash equivalents, end of period | 173,759 | 122,233 | 54,092 |
Supplemental information: | |||
Income taxes paid | 4,021 | 3,993 | $ 4,948 |
Interest paid | 2,444 | 1,222 | |
Payment of contingent consideration in common stock | 1,063 | 875 | |
Spectrum Inc. | |||
Cash flows from investing activities: | |||
Acquisition of assets, net of cash acquired | (112,795) | ||
Supplemental information: | |||
Common stock tendered for acquisition of assets | $ 247,575 | ||
Atoll GmbH | |||
Cash flows from investing activities: | |||
Acquisition of assets, net of cash acquired | (8,767) | ||
Supplemental information: | |||
Common stock tendered for acquisition of assets | 14,135 | ||
TangenX Technology Corporation | |||
Cash flows from investing activities: | |||
Acquisition of assets, net of cash acquired | $ (35,847) |
CONSOLIDATED STATEMENTS OF CAS8
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Business Acquisitions: | ||
Fair value of tangible assets acquired | $ 19,709 | $ 1,420 |
Fair value of accounts receivable | 5,075 | 1,267 |
Fair value of other assets | 1,718 | 183 |
Liabilities assumed | (7,698) | (3,662) |
Fair value of stock issued | (247,575) | (14,135) |
Cost in excess of fair value of assets acquired (Goodwill) | 265,519 | 46,505 |
Acquired identifiable intangible assets | 120,080 | 19,829 |
Deferred tax liabilities, net | (43,608) | (5,841) |
Business Combination Considerations Transferred Net | 113,220 | 45,566 |
Less accrued contingent consideration | (952) | |
Less working capital adjustment | (425) | |
Net cash paid for business acquisitions | $ 112,795 | $ 44,614 |
Organization and Nature of Busi
Organization and Nature of Business | 12 Months Ended |
Dec. 31, 2017 | |
Organization and Nature of Business | 1. Organization and Nature of Business Repligen Corporation (NASDAQ:RGEN) is a bioprocessing company focused on the development, manufacture and commercialization of highly innovative products used to improve the interconnected phases of the biological drug manufacturing process. The Company’s portfolio includes protein products (Protein A affinity ligands, cell culture growth factors), chromatography products (OPUS pre-packed The Company is the leading manufacturer of Protein A ligands, a critical component of Protein A resins that are the industry standard for downstream separation and purification of monoclonal antibody-based therapeutics. The Company’s growth factors are used in upstream processes to accelerate cell growth and productivity in a bioreactor. The Company’s innovative line of OPUS chromatography columns, used in downstream processes for bench-scale through clinical-scale purification needs, are delivered pre-packed single-use Single-use The Company is subject to a number of risks typically associated with companies in the biotechnology industry. These risks principally include the Company’s dependence on key customers, development by the Company or its competitors of new technological innovations, dependence on key personnel, protection of proprietary technology, compliance with the FDA and other governmental regulations and approval requirements, as well as the ability to grow the Company’s business and obtain adequate funding to finance this growth. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2017 | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Significant estimates and assumptions by management affect the Company’s revenue recognition for multiple element arrangements, allowance for doubtful accounts, the net realizable value of inventory, estimated fair value of cost method investments, valuations and purchase price allocations related to business combinations, expected future cash flows including growth rates, discount rates, terminal values and other assumptions and estimates used to evaluate the recoverability of long-lived assets, estimated fair values of intangible assets and goodwill, amortization methods and periods, warranty reserves, certain accrued expenses, stock-based compensation, fair value estimates of contingent consideration, contingent liabilities, tax reserves and recoverability of the Company’s net deferred tax assets and related valuation allowance. Although the Company regularly assesses these estimates, actual results could differ materially from these estimates. Changes in estimates are recorded in the period in which they become known. The Company bases its estimates on historical experience and various other assumptions that it believes to be reasonable under the circumstances. Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Repligen Sweden AB, Repligen GmbH, Spectrum LifeSciences LLC and its subsidiaries (“Spectrum,” acquired on August 1, 2017), TangenX Technology Corporation (“TangenX,” acquired on December 14, 2016 and merged into and with the Company as of June 30, 2017) and Repligen Singapore Pte. Ltd. All significant intercompany accounts and transactions have been eliminated in consolidation. Foreign Currency The Company translates the assets and liabilities of its foreign subsidiary at rates in effect at the end of the reporting period. Revenues and expenses are translated at average rates in effect during the reporting period. Translation adjustments, including adjustments related to the Company’s intercompany loan with Repligen Sweden and Repligen Sweden’s intercompany loan with Repligen GmbH, are remeasured at each period end and included in accumulated other comprehensive income. Revenue Recognition Product Sales The Company’s revenue recognition policy is to recognize revenues from product sales and services in accordance with ASC 605, Revenue Recognition. These standards require that revenues are recognized when persuasive evidence of an arrangement exists, product delivery, including customer acceptance, has occurred or services have been rendered, the price is fixed or determinable and collectability is reasonably assured. Determination of whether these criteria have been met are based on management’s judgments primarily regarding the fixed nature of the fee charged for the product delivered and the collectability of those fees. The Company has a few longstanding customers who comprise the majority of revenue and have excellent payment histories and therefore the Company does not require collateral. The Company has had no significant write-offs of uncollectible invoices in the periods presented. When more than one element such as equipment, consumables, and services are contained in a single arrangement, the Company allocates revenue between the elements based on each element’s relative selling price, provided that each element meets the criteria for treatment as a separate unit of accounting. An item is considered a separate unit of accounting if it has value to the customer on a stand-alone basis. The selling price of the undelivered elements is determined by the price charged when the element is sold separately, or in cases when the item is not sold separately, by third-party evidence of selling price or management’s best estimate of selling price. The Company’s product revenues are from the sale of bioprocessing products, equipment devices, and related consumables used with these equipment devices to customers in the life science and biopharmaceutical industries. On product sales to end customers, revenue is recognized, net of discounts, when both the title and risk of loss have transferred to the customer, as determined by the shipping terms provided there are no uncertainties regarding acceptance, and all obligations have been completed. Generally, our product arrangements for equipment sales are multiple element arrangements, and may include services, such as installation and training, and multiple products, such as consumables and spare parts. In accordance with ASC 605-25, At the time of sale, the Company also evaluates the need to accrue for warranty and sales returns. The supply agreements the Company has with its customers and the related purchase orders identify the terms and conditions of each sale and the price of the goods ordered. Due to the nature of the sales arrangements, inventory produced for sale is tested for quality specifications prior to shipment. Since the product is manufactured to order and in compliance with required specifications prior to shipment, the likelihood of sales return, warranty or other issues is largely diminished. Furthermore, there is no customer right of return in our sales agreements. Sales returns and warranty issues are infrequent and have not had a material impact on the Company’s financial statements historically. Shipping and handling fees are recorded as a component of product revenue, with the associated costs recorded as a component of cost of product revenue. Sale of Intellectual Property to BioMarin In January 2014, the Company entered into an asset purchase agreement (the “Asset Purchase Agreement”) with BioMarin Pharmaceutical Inc. (“BioMarin”) to sell Repligen’s histone deacetylase inhibitor (HDACi) portfolio. The Company is entitled to receive up to $160 million in potential future milestone payments for the development, regulatory approval and commercial sale of portfolio compounds included in the agreement. These potential milestone payments are approximately 37% related to clinical development and 63% related to initial commercial sales in specific geographies. In addition, Repligen is eligible to receive royalties on sales of therapeutic products originating from the HDACi portfolio. The royalty rates are tiered and begin in the mid-single-digits non-HDACi Risks and Uncertainties The Company evaluates its operations periodically to determine if any risks and uncertainties exist that could impact its operations in the near term. The Company does not believe that there are any significant risks which have not already been disclosed in the consolidated financial statements. A loss of certain suppliers could temporarily disrupt operations, although alternate sources of supply exist for these items. The Company has mitigated these risks by working closely with key suppliers, identifying alternate sources and developing contingency plans. Cash, Cash Equivalents and Marketable Securities At December 31, 2016, the Company’s investments included money market funds and short-term marketable securities. There were no such investments as of December 31, 2017. Short-term marketable securities are investments with original maturities of greater than 90 days. Long-term marketable securities are securities with maturities of greater than one year at the original date of purchase. Investments in debt securities consisted of the following at December 31, 2016 (in thousands): Amortized Cost Gross Unrealized Gain Gross Unrealized Loss Fair Value Marketable securities: U.S. Government and agency securities $ 807 $ — $ — $ 807 Corporate and other debt securities 18,745 2 (7 ) 18,740 Total $ 19,552 $ 2 $ (7 ) $ 19,547 There were no long-term marketable securities as of December 31, 2016. There were no realized gains or losses on the investments for the fiscal years ended December 31, 2017, 2016 and 2015. Fair Value Measurement In determining the fair value of its assets and liabilities, the Company uses various valuation approaches. The Company employs a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the inputs that market participants would use in pricing the asset or liability and are developed based on the best information available in the circumstances. The fair value hierarchy is broken down into three levels based on the source of inputs as follows: Level 1 – Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access. Level 2 – Valuations based on quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active and models for which all significant inputs are observable, either directly or indirectly. Level 3 – Valuations based on inputs that are unobservable and significant to the overall fair value measurement. The availability of observable inputs can vary among the various types of financial assets and liabilities. To the extent that the valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for financial statement disclosure purposes, the level in the fair value hierarchy within which the fair value measurement is categorized is based on the lowest level input that is significant to the overall fair value measurement. The Company’s fixed income investments were historically comprised of obligations of U.S. government agencies, corporate debt securities and other interest bearing securities. These investments have been initially valued at the transaction price and subsequently valued, at the end of each reporting period, utilizing third party pricing services or other market observable data. The pricing services utilize industry standard valuation models, including both income and market based approaches and observable market inputs to determine value. These observable market inputs include reportable trades, benchmark yields, credit spreads, broker/dealer quotes, bids, offers, current spot rates and other industry and economic events. The Company validates the prices provided by third party pricing services by reviewing their pricing methods and matrices, obtaining market values from other pricing sources, analyzing pricing data in certain instances and confirming that the relevant markets are active. After completing its validation procedures, the Company did not adjust or override any fair value measurements provided by the pricing services as of December 31, 2017. As of December 31, 2017, the Company had no assets or liabilities for which fair value measurement is either required or has been elected to be applied. As of December 31, 2016, the Company had accrued liabilities with a fair value of $6,119,000 related to contingent consideration in connection with the Refine and Atoll business combinations. The contingent consideration related to Refine was based on actual 2016 revenues. The contingent consideration related to Atoll was based on meeting revenue growth targets in 2016. These valuations were Level 3 valuations, as the primary inputs are unobservable. All contingent consideration liabilities were paid in the first quarter of 2017. The following table provides a rollforward of the fair value of contingent consideration (in thousands): Balance at December 31, 2016 $ 6,119 Payments (6,119 ) Balance at December 31, 2017 $ — In May 2016, the Company issued $115 million aggregate principal amount of the Notes due June 1, 2021. Interest is payable semi-annually in arrears on June 1 and December 1 of each year, beginning on December 1, 2016. As of December 31, 2017, the carrying value of the Notes was $99.3 million, net of unamortized discount, and the fair value of the Notes was approximately $149.5 million. The fair value of the Notes is a Level 1 valuation and was determined based on the most recent trade activity of the Notes as of December 31, 2017. The Notes are discussed in more detail in Note 10, “Convertible Senior Notes . There were no remeasurements to fair value during the year ended December 31, 2017 of financial assets and liabilities that are not measured at fair value on a recurring basis. Inventories Inventories relate to the Company’s bioprocessing business. The Company values inventory at cost or, if lower, net realizable value, using the first-in, first-out work-in-process A change in the estimated timing or amount of demand for the Company’s products could result in additional provisions for excess inventory quantities on hand. Any significant unanticipated changes in demand or unexpected quality failures could have a significant impact on the value of inventory and reported operating results. During all periods presented in the accompanying financial statements, there have been no material adjustments related to a revised estimate of inventory valuations. Work-in-process Inventories consist of the following (in thousands): December 31, December 31, Raw Materials $ 22,351 $ 14,954 Work-in-process 4,083 2,789 Finished products 12,570 6,953 Total $ 39,004 $ 24,696 Accrued Liabilities The Company estimates accrued liabilities by identifying services performed on the Company’s behalf, estimating the level of service performed and determining the associated cost incurred for such service as of each balance sheet date. For example, the Company would accrue for professional and consulting fees incurred with law firms, audit and accounting service providers and other third party consultants. These expenses are determined by either requesting those service providers to estimate unbilled services at each reporting date for services incurred or tracking costs incurred by service providers under fixed fee arrangements. The Company has processes in place to estimate the appropriate amounts to record for accrued liabilities, which principally involve the applicable personnel reviewing the services provided. In the event that the Company does not identify certain costs that have begun to be incurred or the Company under or over-estimates the level of services performed or the costs of such services, the reported expenses for that period may be too low or too high. The date on which certain services commence, the level of services performed on or before a given date, and the cost of such services often require the exercise of judgment. The Company makes these judgments based upon the facts and circumstances known at the date of the financial statements. Income Taxes Deferred taxes are determined based on the difference between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse. Valuation allowances are provided, if, based upon the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. The Company accounts for uncertain tax positions using a “more-likely-than-not” Property, Plant & Equipment Property, Plant & Equipment is recorded at cost less allowances for depreciation. Depreciation is calculated using the straight-line method over the estimated useful life of the asset as follows: Classification Estimated Useful Life Buildings Thirty years Leasehold improvements Shorter of the term of the lease or estimated useful life Equipment Three to twelve years Furniture and fixtures Three to eight years Earnings Per Share Basic earnings per share is computed by dividing net income available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed by dividing net income available to common shareholders by the weighted-average number of common shares and dilutive common share equivalents then outstanding. Potential common share equivalents consist of restricted stock awards and the incremental common shares issuable upon the exercise of stock options and warrants. Under the treasury stock method, unexercised “in-the-money” non-forfeitable A reconciliation of basic and diluted share amounts is as follows: Years ended December 31, 2017 2016 2015 Numerator: Net income $ 28,353,000 $ 11,681,000 $ 9,345,000 Denominator: Basic weighted average common shares outstanding 38,233,527 33,572,883 32,881,940 Effect of dilutive securities: Stock options and restricted stock awards 441,924 526,015 695,151 Convertible senior notes 474,923 — — Diluted weighted average common shares outstanding 39,150,374 34,098,898 33,577,091 Basic net income per common share $ 0.74 $ 0.35 $ 0.28 Diluted net income per common share $ 0.72 $ 0.34 $ 0.28 At December 31, 2017, there were outstanding options to purchase 734,940 shares of the Company’s common stock at a weighted average exercise price of $20.80 per share and 505,235 shares of common stock issuable upon the vesting of restricted stock units. For the fiscal year ended December 31, 2017, 317,923 shares of the Company’s common stock were excluded from the calculation of diluted earnings per share because the exercise prices of the stock options were greater than or equal to the average price of the common shares, and were therefore anti-dilutive. As provided by the terms of the indenture underlying the senior convertible notes, the Company has a choice to settle the conversion obligation for the Convertible Notes in cash, shares or any combination of the two. The Company currently intends to settle the par value of the Convertible Notes in cash and any excess conversion premium in shares. The Company applies the provisions of ASC 260, Earnings Per Share, 10-45-44, At December 31, 2016, there were outstanding options to purchase 1,236,586 shares of the Company’s common stock at a weighted average exercise price of $12.05 per share. For the fiscal year ended December 31, 2016, 381,686 shares of the Company’s common stock were excluded from the calculation of diluted earnings per share because the exercise prices of the stock options were greater than or equal to the average price of the common shares, and were therefore anti-dilutive. At December 31, 2015, there were outstanding options to purchase 1,240,935 shares of the Company’s common stock at a weighted average exercise price of $10.44 per share. For the fiscal year ended December 31, 2015, 196,209 shares of the Company’s common stock were excluded from the calculation of diluted earnings per share because the exercise prices of the stock options were greater than or equal to the average price of the common shares, and were therefore anti-dilutive. Segment Reporting The Company views its operations, makes decisions regarding how to allocate resources and manages its business as one operating segment and two reporting units. As a result, the financial information disclosed herein represents all of the material financial information related to the Company. The following table represents product revenues by product line (in thousands): December 31, 2017 December 31, 2016 December 31, 2015 Protein products $ 53,969 $ 54,716 $ 52,938 Filtration products 49,050 (3) 19,774 (1) 15,676 Chromatography products 36,309 (3) 29,520 (2) 14,613 Other 1,761 (3) 431 310 Total product revenues $ 141,089 $ 104,441 $ 83,537 (1) 2016 revenue for filtration products includes revenue related to TangenX from December 14, 2016 through December 31, 2016. (2) 2016 revenue for chromatography products includes revenue related to Atoll from April 1, 2016 through December 31, 2016. (3) 2017 revenue for filtration, chromatography and other products includes revenue related to Spectrum from August 1, 2017 through December 31, 2017. Revenue from protein products includes the Company’s Protein A ligands and cell culture growth factors. Revenue from filtration products includes the Company’s XCell ATF Systems and consumables and Sius filtration products. Revenue from chromatography products includes the Company’s OPUS and OPUS PD chromatography columns, chromatography resins and ELISA test kits. Other revenue primarily consists of freight revenues. The following table represents the Company’s total revenue by geographic area (based on the location of the customer): Years ended December 31, 2017 2016 2015 United States 43 % 39 % 28 % Sweden 20 % 29 % 37 % United Kingdom 4 % 7 % 17 % Other 33 % 25 % 18 % Total 100 % 100 % 100 % The following table represents the Company’s total assets by geographic area (in thousands): December 31, December 31, United States $ 654,673 $ 209,728 Europe 85,169 79,145 Asia 3,677 40 Total $ 743,519 $ 288,913 The following table represents the Company’s long-lived assets by geographic area (in thousands): December 31, December 31, United States $ 465,453 $ 77,039 Europe 34,430 27,721 Asia 854 — Total $ 500,737 $ 104,760 Concentrations of Credit Risk and Significant Customers Financial instruments that subject the Company to significant concentrations of credit risk primarily consist of cash and cash equivalents, marketable securities and accounts receivable. Per the Company’s investment policy, cash equivalents and marketable securities are invested in financial instruments with high credit ratings and credit exposure to any one issue, issuer (with the exception of U.S. treasury obligations) and type of instrument is limited. At December 31, 2017 and 2016, the Company had no investments associated with foreign exchange contracts, options contracts or other foreign hedging arrangements. Concentration of credit risk with respect to accounts receivable is limited to customers to whom the Company makes significant sales. While a reserve for the potential write-off Revenue from significant customers as a percentage of the Company’s total revenue is as follows: Years ended December 31, 2017 2016 2015 GE Healthcare 21 % 29 % 37 % MilliporeSigma 18 % 28 % 29 % Significant accounts receivable balances as a percentage of the Company’s total trade accounts receivable and royalties and other receivable balances are as follows: December 31, 2017 December 31, 2016 GE Healthcare 11 % 26 % MilliporeSigma 19 % 8 % Goodwill, Other Intangible Assets and Acquisitions Acquisitions Total consideration transferred for acquisitions is allocated to the assets acquired and liabilities assumed, if any, based on their fair values at the dates of acquisition. The fair value of identifiable intangible assets is based on detailed valuations that use information and assumptions determined by management. Any excess of purchase price over the fair value of the net tangible and intangible assets acquired is allocated to goodwill. Any excess of the fair value of the net tangible and intangible assets acquired over the purchase price is recognized in the statement of operations. The fair value of contingent consideration includes estimates and judgments made by management regarding the probability that future contingent payments will be made and the extent of royalties to be earned in excess of the defined minimum royalties. Management updates these estimates and the related fair value of contingent consideration at each reporting period. Changes in the fair value of contingent consideration are recorded in the consolidated statements of operations. The Company uses the income approach to determine the fair value of certain identifiable intangible assets including customer relationships and developed technology. This approach determines fair value by estimating after-tax after-tax Goodwill Goodwill is not amortized and is reviewed for impairment at least annually. There was no evidence of impairment to goodwill at December 31, 2017 and 2016. There were no goodwill impairment charges during the fiscal years ended December 31, 2017, 2016 and 2015. Intangible Assets Intangible assets are amortized over their useful lives using the estimated economic benefit method, as applicable, and the amortization expense is recorded within cost of product revenue and selling, general and administrative expense in the statements of operations. Intangible assets and their related useful lives are reviewed at least annually to determine if any adverse conditions exist that would indicate the carrying value of these assets may not be recoverable. More frequent impairment assessments are conducted if certain conditions exist, including a change in the competitive landscape, any internal decisions to pursue new or different technology strategies, a loss of a significant customer, or a significant change in the marketplace, including changes in the prices paid for our products or changes in the size of the market for our products. If impairment indicators are present, the Company determines whether the underlying intangible asset is recoverable through estimated future undiscounted cash flows. If the asset is not found to be recoverable, it is written down to the estimated fair value of the asset based on the sum of the future discounted cash flows expected to result from the use and disposition of the asset. If the estimate of an intangible asset’s remaining useful life is changed, the remaining carrying amount of the intangible asset is amortized prospectively over the revised remaining useful life. The Company continues to believe that its intangible assets are recoverable at December 31, 2017. Intangible assets consisted of the following at December 31, 2017 (in thousands): Gross Carrying Accumulated Weighted Technology – developed $ 51,801 $ (3,201 ) 19 Patents 240 (238 ) 8 Customer relationships 102,120 (9,636 ) 14 Trademarks – definite lived 2,160 (47 ) 20 Trademarks – indefinite lived 700 — — Other intangibles 1,063 (209 ) 3 Total intangible assets $ 158,084 $ (13,331 ) 16 Intangible assets consisted of the following at December 31, 2016 (in thousands): Gross Carrying Accumulated Weighted Technology – developed $ 12,911 $ (1,468 ) 17 Patents 240 (208 ) 8 Customer relationships 22,555 (4,995 ) 11 Trademark/ tradename 711 — — Other intangibles 84 (24 ) 2 Total intangible assets $ 36,501 $ (6,695 ) 13 Amortization expense for amortized intangible assets was approximately $6,215,000, $2,052,000 and $1,600,000 for the years ended December 31, 2017, 2016 and 2015, respectively. As of December 31, 2017, the Company expects to record the following amortization expense (in thousands): Year Ending Amortization Expense December 31, 2018 $ 10,633 December 31, 2019 10,578 December 31, 2020 9,894 December 31, 2021 9,376 December 31, 2022 9,374 Stock Based Compensation The Company measures stock-based compensation cost at the grant date based on the estimated fair value of the award, and recognizes it as expense over the employee’s requisite service period on a straight-line basis. The Company records the expense for share-based awards subject to performance-based milestone vesting over the remaining service period when management determines that achievement of the milestone is probable. Management evaluates whether the achievement of a performance-based milestone is probable as of the reporting date. The Company has no awards that are subject to market conditions. The Company recognizes stock-based compensation expense based upon options that are ultimately expected to vest, and accordingly, such compensation expense has been adjusted by an amount of estimated forfeitures. The Company uses the Black-Scholes option pricing model to calculate the fair value of share-based awards on the grant date. The following assumptions are used in calculating the fair value of share-based awards: Expected term Expected volatility Risk-free interest rate zero-coupon Expected dividend yield Estimated forfeiture rates non-executive non-employee Recently Issued Accounting Pronouncements In May 2014, the FASB issued ASU No. 2014-09, Revenue Recognition Revenue from Contracts with Customers 2015-14, 2016-08, 2016-10, 2016-12, In July 2015, the FASB issued ASU No. 2015-11, 2015-11”). 2015-11 2015-11 2015-11 In February 2016, the FASB issued ASU No. 2016-02, “Leases 2016-02”). 2016-02 right-of-use right-of-use In March 2016, the FASB issued ASU No. 2016-09, “Compensation—Stock 2016-09 In August 2016, the FASB issued ASU No. 2016-15, No. 2016-15 No. 2016-15 2016-15 In November 2016, the FASB issued ASU No. 2016-18, “Statement of Cash Flows (Topic 230): Restricted Cash,” which requires that the statement of cash flows explain the change during the period in the total cash, which is inclusive of cash and cash equivalents and amounts generally described as restricted cash or restricted cash equivalents. Restricted cash and restricted cash equivalents will be included with cash and cash equivalents when reconciling the beginning of period and end of period balances on the statement of cash flows upon adoption of this standard. The ASU is effective for the Company on January 1, 2018 with early adoption permitted. The Company intends to adopt the ASU on January 1, 2018. Upon adoption, the ASU requires retrospective application. Beginning in 2018, the Company will include $450,000 of restricted cash with total cash and cash equivalents in its 2016 and 2017 cash flow statements. |
Acquisitions, Goodwill and Othe
Acquisitions, Goodwill and Other Intangible Assets | 12 Months Ended |
Dec. 31, 2017 | |
Acquisitions, Goodwill and Other Intangible Assets | 3. Acquisitions, Goodwill and Other Intangible Assets Acquisitions Spectrum LifeSciences, LLC On August 1, 2017, the Company completed the acquisition of Spectrum pursuant to the terms of the Agreement and Plan of Merger and Reorganization, dated as of June 22, 2017 (such acquisition, the “Spectrum Acquisition”). Spectrum is a diversified filtration company with a differentiated portfolio of hollow fiber cartridges, bench-top single-use Spectrum’s filtration products include its KrosFlo ® single-use ® Pro-Connex ® single-use Module-Bag-Tubing ® The Spectrum Acquisition was accounted for as a purchase of a business under ASC 805, Business Combinations. The Spectrum Acquisition was funded through payment of approximately $122.9 million in cash, 6,153,995 unregistered shares of the Company’s common stock totaling $247.6 million and a working capital adjustment of $425,000 for a total purchase price of $370.9 million. Consideration Transferred The Company accounted for the Spectrum Acquisition as a purchase of a business under U.S. GAAP. Under the acquisition method of accounting, the assets of Spectrum were recorded as of the acquisition date, at their respective fair values, and consolidated with those of the Company. The fair value of the net assets acquired was approximately $370.9 million. The preparation of the valuation required the use of significant assumptions and estimates. Critical estimates included, but were not limited to, future expected cash flows, including projected revenues and expenses, and the applicable discount rates. These estimates were based on assumptions that the Company believes to be reasonable; however, actual results may differ from these estimates. The total consideration transferred follows (in thousands): Cash consideration $ 122,932 Equity consideration 247,575 Working capital adjustment 425 Net assets acquired $ 370,932 Acquisition-related costs are not included as a component of consideration transferred, but are expensed in the periods in which the costs are incurred. The Company has incurred $7,060,000 in costs related to the Spectrum Acquisition for the year ended December 31, 2017. These costs are primarily included in selling, general and administrative expenses in the consolidated statements of operations. Fair Value of Net Assets Acquired The allocation of purchase price was based on the fair value of assets acquired and liabilities assumed as of August 1, 2017, based on the preliminary valuation. The components and allocation of the purchase price consists of the following amounts (in thousands): Cash and cash equivalents $ 10,137 Accounts receivable 5,075 Inventory 13,705 Prepaid expenses and other assets 616 Fixed assets 6,004 Deferred tax assets 1,102 Customer relationships 78,400 Developed technology 38,560 Trademark and tradename 2,160 Non-competition agreements 960 Goodwill 265,519 Accounts payable (1,335 ) Unrecognized tax benefit (576 ) Accrued liabilities (5,787 ) Deferred tax liabilities (43,608 ) Fair value of net assets acquired $ 370,932 Of the consideration paid, $78.4 million represents the fair value of customer relationships that will be amortized over the weighted average determined useful life of 15 years, and $38.6 million represents the fair value of developed technology that will be amortized over a determined useful life of 20 years. $960,000 represents the fair value of non-competition The goodwill of $265.5 million represents future economic benefits expected to arise from synergies from combining operations and commercial organizations to increase market presence and the extension of existing customer relationships. None of the goodwill recorded is expected to be deductible for income tax purposes. The purchase price allocation may be subject to adjustment as purchase accounting is preliminary as of December 31, 2017 related to inventory valuation, and accordingly, the fair value of inventory acquired may be subject to change. Revenue, Net Income and Pro Forma Presentation The Company recorded revenue from Spectrum of $19,394,000 from August 1, 2017 through December 31, 2017. The Company has included the operating results of Spectrum in its consolidated statements of operations since the August 1, 2017 acquisition date. The following table presents unaudited supplemental pro forma information as if both the Spectrum Acquisition had occurred as of January 1, 2016 and the TangenX Acquisition had occurred as of January 1, 2015 (in thousands, except per share data): December 31, 2017 December 31, 2016 Total revenue 162,913 145,994 Net income (loss) 17,220 (12,656 ) Earnings (loss) per share: Basic $ 0.41 $ (0.32 ) Diluted $ 0.40 $ (0.32 ) The unaudited pro forma information for the years ended December 31, 2017 and 2016 was calculated after applying the Company’s accounting policies and the impact of acquisition date fair value adjustments. Unaudited pro forma net income for year ended December 31, 2017 was adjusted to exclude acquisition-related transaction costs, nonrecurring expenses related to the fair value adjustments associated with the acquisition and income tax benefits resulting from the acquisition. In addition, the unaudited pro forma net income for the year ended December 31, 2017 was adjusted to include incremental amortization of intangible assets. These items have been factored to the unaudited pro forma net income for the year ended December 31, 2017. The unaudited pro forma net loss for the year ended December 31, 2016 was adjusted to include acquisition-related transaction costs, expenses related to the fair value adjustments, amortization of intangible assets, and income tax benefits resulting from the acquisition. These pro forma condensed consolidated financial results have been prepared for comparative purposes only and include certain adjustments to reflect the pro forma results of operations as if the acquisition had occurred as of the beginning of the periods presented, such as fair value adjustments to inventory and increased amortization for the fair value of acquired intangible assets. The pro forma information does not reflect the effect of costs or synergies that would have been expected to result from the integration of the acquisition. The pro forma information does not purport to be indicative of the results of operations that actually would have resulted had the combination occurred at the beginning of each period presented, or of future results of the consolidated entities. TangenX Technology Corporation On December 14, 2016, the Company acquired TangenX Technology Corporation (“TangenX”), pursuant to the terms of the Share Purchase Agreement, dated as of December 14, 2016 (the “Share Purchase Agreement”), by and among the Company and TangenX (such acquisition, the “TangenX Acquisition”). The Company acquired all outstanding shares and the business of TangenX, including TangenX’s innovative single-use Sius TFF is used in the filtration of biological drugs, complimenting Repligen’s OPUS line of pre-packed The TangenX Acquisition was accounted for as a purchase of a business under ASC 805, “Business Combinations.” The total purchase price of the TangenX Acquisition was $37.1 million in cash. Consideration Transferred The Company accounted for the TangenX Acquisition as the purchase of a business under U.S. GAAP. Under the acquisition method of accounting, the assets of TangenX were recorded as of the acquisition date, at their respective fair values, and consolidated with those of Repligen. The fair value of the net assets acquired was approximately $37.1 million. The preparation of the valuation required the use of significant assumptions and estimates. Critical estimates included, but were not limited to, future expected cash flows, including projected revenues and expenses, and the applicable discount rates. These estimates were based on assumptions that the Company believes to be reasonable. However, actual results may differ from these estimates. The total consideration transferred follows (in thousands): Cash consideration $ 37,532 Less: working capital adjustment (382 ) Net assets acquired $ 37,150 Acquisition related costs are not included as a component of consideration transferred, but are expensed in the periods in which the costs are incurred. The Company incurred transaction costs of $431,000 in the year ended December 31, 2017 and $935,000 in the year ended December 31, 2016 related to the TangenX Acquisition. The transaction costs are included in selling, general and administrative expenses in the consolidated statements of operations. Fair Value of Net Assets Acquired The allocation of purchase price was based on the fair value of assets acquired and liabilities assumed as of December 14, 2016. The components and allocation of the purchase price consists of the following amounts (in thousands): Cash and cash equivalents $ 1,218 Accounts receivable 459 Other receivables 111 Inventory 936 Other current assets 50 Fixed assets, net 215 Customer relationships 6,192 Developed technology 6,044 Non-competition 21 Trademark and trade name 11 Accounts payable and other liabilities assumed (3,083 ) Deferred tax liabilities (4,525 ) Goodwill 29,501 Net assets acquired $ 37,150 Of the consideration paid, $6.2 million represents the fair value of customer relationships that will be amortized over the determined useful life of 13 years and $6.0 million represents the fair value of developed technology that will be amortized over a determined useful life of 20 years. $21,000 represents the fair value of non-competition The goodwill of $29.5 million represents future economic benefits expected to arise from synergies from combining operations and the extension of existing customer relationships. Revenue, Net Income and Pro Forma Presentation The Company recorded revenue from TangenX of approximately $119,000 from December 15, 2016 through December 31, 2016. The Company has included the operating results of TangenX in its consolidated statements of operations since the December 15, 2016 acquisition date. The following table presents unaudited supplemental pro forma information as if the TangenX Acquisition had occurred as of January 1, 2015 (in thousands, except per share data): December 31, 2016 December 31, 2015 Total revenue 110,228 88,437 Net income 5,744 13,208 Earnings per share: Basic $ 0.17 $ 0.40 Diluted $ 0.17 $ 0.39 The unaudited pro forma information for the year ended December 31, 2016 and 2015 was calculated after applying the Company’s accounting policies and the impact of acquisition date fair value adjustments. Unaudited pro forma net income for year ended December 31, 2016 was adjusted to exclude acquisition-related transaction costs, nonrecurring expenses related to the fair value adjustments associated with the acquisition, and income tax benefits resulting from the acquisition. In addition, the unaudited pro forma net income for the year ended December 31, 2016 was adjusted to include incremental amortization of intangible assets. These items have been factored to the unaudited pro forma net income for the year ended December 31, 2016. The unaudited pro forma net income for the year ended December 31, 2015 was adjusted to include these acquisition-related transaction costs, expenses related to the fair value adjustments, amortization of intangible assets, and income tax benefits resulting from the acquisition. These pro forma condensed consolidated financial results have been prepared for comparative purposes only and include certain adjustments to reflect the pro forma results of operations as if the acquisition had occurred as of the beginning of the periods presented, such as fair value adjustments to inventory and increased amortization for the fair value of acquired intangible assets. The pro forma information does not reflect the effect of costs or synergies that would have been expected to result from the integration of the acquisition. The pro forma information does not purport to be indicative of the results of operations that actually would have resulted had the combination occurred at the beginning of each period presented, or of future results of the consolidated entities. Atoll GmbH On April 1, 2016, the Company’s subsidiary Repligen Sweden acquired Atoll GmbH (“Atoll”) from UV-Cap In connection with the Atoll Acquisition, the Company issued and contributed 538,700 shares of the Company’s common stock, par value of $0.01 per share valued at $14.1 million (the “Stock Consideration”) to Repligen Sweden through a transfer by the Company on behalf of Repligen Sweden to fulfill Repligen Sweden’s obligation to deliver the Stock Consideration under the Share Purchase Agreement. The issuance of the Stock Consideration was not registered under the Securities Act of 1933, as amended (the “Securities Act”), in reliance upon the exemption from registration provided by Section 4(2) of the Securities Act. The Stock Consideration was based on the fair value of the Company’s common stock on April 1, 2016. This acquisition strengthened Repligen’s bioprocessing business by adding a complementary extension to an existing product line while expanding its direct sales presence worldwide. On September 20, 2016, Atoll changed its name to Repligen GmbH. The Atoll Acquisition was accounted for as a purchase of a business under ASC 805, “Business Combinations.” The total purchase price of the Atoll Acquisition was $25.3 million, consisting of an upfront cash payment of $10.2 million, less $74,000 as a result of the final determination of working capital, issuance of the Stock Consideration, and a future potential milestone payment of $1.1 million if specific revenue growth targets are met for 2016. The $1.1 million potential contingent consideration had an initial probability weighted fair value at the time of the closing of the Atoll Acquisition of approximately $952,000. Consideration Transferred The Company accounted for the Atoll Acquisition as the purchase of a business under U.S. GAAP. Under the acquisition method of accounting, the assets of Atoll were recorded as of the acquisition date, at their respective fair values, and consolidated with those of Repligen. The fair value of the net assets acquired was approximately $25.3 million. The preparation of the valuation required the use of significant assumptions and estimates. Critical estimates included, but were not limited to, future expected cash flows, including projected revenues and expenses, and the applicable discount rates. These estimates were based on assumptions that the Company believes to be reasonable. However, actual results may differ from these estimates. The total consideration transferred follows (in thousands): Cash consideration, less $74 of working capital adjustments $ 10,176 Value of common stock issued 14,138 Estimated fair value of contingent consideration 952 Total consideration transferred $ 25,266 The fair value of contingent consideration was determined based upon a probability weighted analysis of expected future milestone and settlement payments to be made to the Seller. The Company could make a contingent consideration payment of $1.1 million if specific revenue growth targets are met for 2016. The liability for contingent consideration was included in current liabilities on the consolidated balance sheets. Because the contingent consideration related only to 2016 sales growth, no further remeasurement of this liability was required as of December 31, 2016. See Note 9 – Accrued Liabilities for further details. Acquisition related costs are not included as a component of consideration transferred, but are expensed in the periods in which the costs are incurred. The Company incurred $1,307,000 in transaction costs related to the Atoll Acquisition. The transaction costs are included in selling, general and administrative expenses in the consolidated statements of operations. Fair Value of Net Assets Acquired The allocation of purchase price was based on the fair value of assets acquired and liabilities assumed as of April 1, 2016. The components and allocation of the purchase price consists of the following amounts (in thousands): Cash and cash equivalents $ 1,409 Accounts receivable 697 Inventory 155 Other current assets 169 Fixed assets 114 Customer relationships 5,318 Developed technology 2,175 Non-competition 57 Trademark and trade name 11 Deferred tax assets 885 Accounts payable and other liabilities assumed (599 ) Deferred tax liabilities (2,202 ) Goodwill 17,077 Net assets acquired $ 25,266 Of the consideration paid, $5.3 million represents the fair value of customer relationships that will be amortized over the determined useful life of 13 years and $2.2 million represents the fair value of developed technology that will be amortized over a determined useful life of 14 years. $57,000 represents the fair value of non-competition The goodwill of $17.1 million represents future economic benefits expected to arise from synergies from combining operations, utilizing the Company’s existing sales infrastructure to increase market presence and the extension of existing customer relationships. Goodwill The changes in the carrying value of goodwill for the year ended December 31, 2017 is as follows (in thousands): Balance at December 31, 2016 $ 59,548 Goodwill adjustments arising from the TangenX Acquisition 85 Goodwill arising from the Spectrum Acquisition 265,519 Foreign currency adjustments on goodwill from the Atoll Acquisition 2,181 Balance at December 31, 2017 $ 327,333 Other Intangible Assets Intangible assets, except for the ATF tradename, are amortized over their useful lives using the estimated economic benefit method, as applicable, and the amortization expense is recorded within selling, general and administrative expense in the Company’s statements of comprehensive income. The ATF tradename are not amortized. The Company reviews its indefinite-lived intangible assets not subject to amortization to determine if adverse conditions exist or a change in circumstances exists that would indicate an impairment. Intangible assets and their related useful lives are reviewed at least annually to determine if any adverse conditions exist that would indicate the carrying value of these assets may not be recoverable. More frequent impairment assessments are conducted if certain conditions exist, including a change in the competitive landscape, any internal decisions to pursue new or different technology strategies, a loss of a significant customer, or a significant change in the marketplace, including changes in the prices paid for our products or changes in the size of the market for our products. An impairment results if the carrying value of the asset exceeds the estimated fair value of the asset. If the estimate of an intangible asset’s remaining useful life is changed, the remaining carrying amount of the intangible asset is amortized prospectively over the revised remaining useful life. The Company continues to believe that its intangible assets are recoverable at December 31, 2017. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2017 | |
Income Taxes | 4. Income Taxes Income tax data for the years ended December 31, 2017, 2016 and 2015 (in thousands): December 31, 2017 December 31, 2016 December 31, 2015 The components of income from operations before income taxes are as follows: Domestic $ (6,709 ) $ (4,882 ) $ (2,490 ) Foreign 13,957 16,574 15,913 Total $ 7,248 $ 11,692 $ 13,423 The current and deferred components of the provision for income taxes on operations are as follows: Current $ 3,624 $ 4,077 $ 3,745 Deferred (24,729 ) (4,066 ) 333 Total $ (21,105 ) $ 11 $ 4,078 The jurisdictional components of the provision for income taxes on operations are as follows: Federal $ (24,012 ) $ (3,809 ) $ 295 State (438 ) (207 ) 276 Foreign 3,345 4,027 3,507 Total $ (21,105 ) $ 11 $ 4,078 At December 31, 2017, the Company had net operating loss carryforwards of approximately $19,652,000 in the U.S., net operating loss carryforwards of approximately €603,000 (approximately $722,000) in Germany, federal business tax credit carryforwards of $297,000 and state business tax credit carryforwards of approximately $99,000 available to reduce future domestic income taxes, if any. The net operating loss and business tax credits carryforwards will continue to expire at various dates through December 2037. The net operating loss and business tax credit carryforwards are subject to review and possible adjustment by the Internal Revenue Service and may be limited in the event of certain changes in the ownership interest of significant stockholders. December 31, 2017 December 31, 2016 Deferred tax assets: Temporary timing differences: Stock compensation $ 1,662 $ 1,722 Contingent consideration 2,196 3,333 Other 1,704 1,895 Total temporary timing differences 5,562 6,950 Net operating loss carryforwards 4,361 12,284 Tax business credits carryforwards 1,265 2,036 Total deferred tax assets 11,188 21,270 Valuation allowance (6 ) (9,979 ) Net deferred tax assets $ 11,182 $ 11,291 Deferred tax liabilities: Goodwill and intangible assets $ (33,166 ) $ (7,346 ) Conversion option on convertible notes (3,183 ) (6,048 ) Total deferred tax liabilities $ (36,349 ) $ (13,394 ) Net deferred tax liabilities $ (25,167 ) $ (2,103 ) The net change in the total valuation allowance was a decrease of $9,973,000 in the year ended December 31, 2017 and consisted of the following changes. During the first quarter of 2017 the Company adopted ASU 2016-09. 2016-09 The reconciliation of the federal statutory rate to the effective income tax rate for the fiscal years ended December 31, 2017, 2016 and 2015 is as follows (amounts in thousands): Year Ended December 31, 2017 December 31, 2016 December 31, 2015 Income before income taxes $ 7,248 $ 11,692 $ 13,423 Expected tax at statutory rate 2,537 35.0 % 3,975 34.0 % 4,564 34.0 % Adjustments due to: Difference between U.S. and foreign tax (1,797 ) (24.8 %) (2,031 ) (17.4 %) (1,910 ) (14.2 %) State income and franchise taxes (307 ) (4.2 %) (326 ) (2.8 %) 563 4.2 % Business tax credits (7,708 ) (9.8 %) (236 ) (2.0 %) (115 ) (0.9 %) Permanent differences: Stock compensation (946 ) (13.1 %) 31 0.3 % 348 2.6 % Transaction costs 1,232 17.0 % 156 1.3 % — — Other 470 6.4 % 380 3.2 % (230 ) (1.7 %) Change in U.S. federal tax rates (12,839 ) (177.2 %) — — — — Transition tax 3,266 45.1 % — — — — Change in valuation allowance (12,164 ) (167.8 %) (1,981 ) (16.9 %) 1,216 9.1 % Other (151 ) (2.1 %) 43 0.4 % (358 ) (2.7 %) Provision for income taxes $ (21,105 ) (291.2 %) $ 11 0.1 % $ 4,078 30.4 % The Company’s tax returns are subject to examination by federal, state and international taxing authorities for the following periods: Jurisdiction Fiscal years subject to examination United States – federal and state 2014-2017 Sweden 2011-2017 Germany 2016-2017 Netherlands 2012-2017 The following is a tabular reconciliation of the total amounts of unrecognized tax benefits (in thousands): Unrecognized tax benefits at January 1, 2017 1,407 Gross increases – tax positions in prior period 679 Gross increases – tax positions in current period 199 Gross decreases – release (479 ) Unrecognized tax benefits at December 31, 2017 $ 1,806 Included in the balance of unrecognized tax benefits as of December 31, 2017 are $1,806,000, of tax benefits that, if recognized, would affect the effective tax rate. At December 31, 2017, the Company has not provided for U.S. income taxes or foreign withholding taxes on outside basis differences of foreign subsidiaries of approximately $53,747,000 as it is the Company’s current intention to permanently reinvest these earnings outside the U.S. On December 22, 2017, President Trump signed into law H.R. 1/Public Law No. 115-97, low-taxed one-time The Act lowered the Company’s U.S. statutory federal tax rate from 35% to 21% effective January 1, 2018. The Company recorded a tax benefit of $12,812,000 in the year ended December 31, 2017 for the reduction in its US deferred tax assets and liabilities resulting from the rate change. The Act also includes a one-time We anticipate that future guidance and interpretations with the respect to the Act will cause us to further adjust the provisional amounts recorded as of December 31, 2017. Any measurement period adjustments will be reported as a component of provision for income taxes in the reporting period the amounts are determined. The final accounting will be completed no later than one year from the enactment of the Act. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2017 | |
Stockholders' Equity | 5. Stockholders’ Equity Public Offering of Common Stock On July 3, 2017, the Company completed a public offering in which 2,807,017 shares of its common stock were sold to the public at a price of $42.75 per share. The underwriters were granted an option, which they exercised in full, to purchase an additional 421,052 shares of the Company’s common stock. The total proceeds from this offering, net of underwriting discounts, commissions and other offering expenses, totaled approximately $129.3 million. Stock-Based Compensation The Company recorded stock-based compensation expense of approximately $6,747,000, $4,595,000 and $3,598,000 for the years ended December 31, 2017, 2016 and 2015, respectively, for share-based awards granted under the Second Amended and Restated 2001 Repligen Corporation Stock Plan (the “2001 Plan”) and the Repligen Corporation 2012 Stock Option and Incentive Plan (the “2012 Plan,” and collectively with the 2001 Plan and the 1992 Repligen Corporation Stock Option Plan, the “Plans”). The following table presents stock-based compensation expense in the Company’s consolidated statements of operations (in thousands): Years ended December 31, 2017 2016 2015 Cost of product revenue $ 704 $ 341 $ 213 Research and development 481 537 336 Selling, general and administrative 5,562 3,717 3,049 Total $ 6,747 $ 4,595 $ 3,598 During 2016, the Company modified certain stock option grants for its former senior vice president of research and development in conjunction with his retirement. As part of the April 2016 transition agreement, all outstanding equity awards continued to vest through December 31, 2016, and fifty percent (50%) of the option awards that are unvested on February 28, 2017 immediately vested and became exercisable as of that date. As a result of these modifications to his share-based payment arrangements, the Company incurred stock compensation expense of $292,000 for the year ended December 31, 2016. This expense was recorded to research and development expense on the Company’s consolidated statement of operations. During 2015, the Company modified certain stock option grants for its former president and chief executive officer in conjunction with his retirement. As part of the January 2015 transition agreement, all outstanding equity awards continued to vest through December 31, 2015, and fifty percent (50%) of the option awards that are unvested on December 31, 2015 immediately vested and became exercisable as of that date. As a result of these modifications to his share-based payment arrangements, the Company incurred stock compensation expense of $826,000 for the year ended December 31, 2015. This expense was recorded to selling, general and administrative expense on the Company’s consolidated statement of operations. The 2012 Plan allows for the granting of incentive and nonqualified options to purchase shares of common stock, restricted stock and other equity awards. Incentive options granted to employees under the Plans generally vest over a three to five-year period, with 20%-33% non-employee The Company uses the Black-Scholes option pricing model to calculate the fair value of share-based awards on the grant date. The fair value of share-based awards granted during the years ended December 31, 2017, 2016 and 2015 were calculated using the following estimated assumptions: 2017 2016 2015 Expected term (years) 6.1 6.7 – 7.1 6.6 – 7.2 Volatility 51.48% 50.85 – 51.01% 50.09 – 51.89% Risk-free interest rate 1.88 – 1.99% 1.51 – 2.37% 1.67 – 2.03% Expected dividend yield — — — Information regarding option activity for the year ended December 31, 2017 under the Plans is summarized below: Options Outstanding Weighted- Weighted- (in thousands) Options outstanding at December 31, 2016 882,748 $ 16.88 Granted 101,844 33.38 Exercised (215,495 ) 10.92 Forfeited/cancelled (34,157 ) 20.23 Options outstanding at December 31, 2017 734,940 $ 20.80 6.46 $ 11,558 Options exercisable at December 31, 2017 420,688 $ 15.86 5.28 $ 8,720 Vested and expected to vest at December 31, 2017 (1) 727,278 $ 20.71 6.44 $ 11,472 (1) Represents the number of vested options as of December 31, 2017 plus the number of unvested options expected to vest as of December 31, 2017 based on the unvested outstanding options at December 31, 2017 adjusted for estimated forfeiture rates of 8% for awards granted to non-executive The aggregate intrinsic value in the table above represents the total pre-tax in-the-money The weighted average grant date fair value of options granted during the years ended December 31, 2017, 2016 and 2015 was $16.94, $14.16 and $16.05, respectively. The total fair value of stock options that vested during the years ended December 31, 2017, 2016 and 2015 was approximately $2,220,000, $1,713,000 and $1,536,000, respectively. Information regarding restricted stock unit activity for the year ended December 31, 2017 under the Plans is summarized below: Options Weighted- (in thousands) Restricted stock units outstanding at December 31, 2016 353,838 Granted 293,004 Vested (114,690 ) Forfeited/cancelled (26,917 ) Restricted stock units outstanding at December 31, 2017 505,235 2.65 $ 18,330 Vested and expected to vest at December 31, 2017 (1) 466,201 2.40 $ 16,914 (1) Represents the number of vested restricted stock units as of December 31, 2017 plus the number of unvested restricted stock units expected to vest as of December 31, 2017 based on the unvested outstanding restricted stock units at December 31, 2017 adjusted for estimated forfeiture rates of 8% for awards granted to non-executive The aggregate intrinsic value in the table above represents the total pre-tax The weighted average grant date fair value of restricted stock units granted during the years ended December 31, 2017, 2016 and 2015 was $26.03, $27.25 and $29.07, respectively. The total fair value of restricted stock units that vested during the years ended December 31, 2017, 2016 and 2015 was approximately $4,010,000, $1,474,000 and $781,000, respectively. As of December 31, 2017, there was $16,133,000 of total unrecognized compensation cost related to unvested share-based awards. This cost is expected to be recognized over a weighted average remaining requisite service period of 2.52 years. The Company expects 772,791 unvested options and restricted stock units to vest over the next five years. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies | 6. Commitments and Contingencies Lease Commitments In 2001, the Company entered into a ten-year In March 2014, the Company entered into an amendment of its existing lease to expand the rented space from 55,694 to 75,594 square feet at 41 Seyon Street, Waltham, Massachusetts. Pursuant to the terms of the amended lease, Repligen leased an additional 19,900 square feet (the “Expansion Space”) for a period of eight years and one month, commencing on August 1, 2014. The amended lease provides for additional rent expense of approximately $361,000 on an annualized basis. The amended lease also required an increase to the letter of credit from $200,000 to $450,000 and continues to require the Company to pay a proportionate share of certain of the landlord’s annual operating costs and real estate taxes. In 2017, the issuing bank no longer required collateral to secure the letter of credit; as a result, the Company released the funds from restricted cash. Future minimum rental commitments under the amended lease as of December 31, 2017 are $1,371,000 for the years ending December 31, 2018, 2019, 2020 and 2021, respectively and $1,251,000 for the year ended December 31, 2022. In 2007, the Company entered into a five-year lease agreement for approximately 2,500 square feet of space in Waltham, Massachusetts to provide for expanded manufacturing operations. Adjacent to this space, the Company entered into a two-year month-to-month The Company leases four adjacent buildings in Lund, Sweden totaling approximately 45,000 square feet of space used primarily for biologics manufacturing and administrative operations. The lease was renewed during 2016 and expires on December 31, 2021. Future minimum rental commitments under the amended lease as of December 31, 2017 are $1,087,000 for the years ending December 31, 2018, 2019, 2020 and 2021, respectively. Obligations under non-cancelable Years Ending Operating Leases December 31, 2018 3,611 December 31, 2019 3,383 December 31, 2020 3,077 December 31, 2021 2,750 December 31, 2022 1,464 Thereafter 786 Minimum lease payments $ 15,071 Rent expense charged to operations under operating leases was approximately $3,367,000, $2,644,000 and $2,619,000 for the fiscal years ended December 31, 2017, 2016 and 2015, respectively. As of December 31, 2017, 2016 and 2015, the Company had deferred rent liabilities of $1,656,000, $1,792,000 and $1,899,000, respectively, related to the escalating rent provisions for the Waltham headquarters and the Company’s facility in Rancho Dominguez, California. Licensing and Research Agreements The Company licenses certain technologies that are, or may be, incorporated into its technology under several agreements and also has entered into several clinical research agreements which require the Company to fund certain research projects. Generally, the license agreements require the Company to pay annual maintenance fees and royalties on product sales once a product has been established using the technologies. The Company recorded research and development expenses associated with license agreements of approximately $161,000, $5,000 and $7,000 for the years ended December 31, 2017, 2016 and 2015, respectively. In October 2009, the Company entered into an exclusive worldwide commercial license agreement with Families of Spinal Muscular Atrophy (see Note 2). Pursuant to the License Agreement dated December 28, 2012, the Company transferred all rights and obligations related to the FSMA License Agreement to Pfizer. The License Agreement was terminated by Pfizer, effective as of April 26, 2015. Purchase Orders, Supply Agreements and Other Contractual Obligations In the normal course of business, the Company has entered into purchase orders and other agreement with manufacturers, distributors and others. Outstanding obligations at December 31, 2017 of approximately $15,512,000 are expected to be completed within one year. |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 12 Months Ended |
Dec. 31, 2017 | |
Prepaid Expenses and Other Current Assets | 7. Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consist of the following (in thousands): December 31, 2017 December 31, 2016 Equipment maintenance and services $ 1,091 $ 586 Prepaid taxes 311 626 Prepaid insurance 594 356 Deferred costs 67 5 Other 218 71 Total $ 2,281 $ 1,644 |
Property, Plant and Equipment
Property, Plant and Equipment | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment | 8. Property, Plant and Equipment Property, plant and equipment consist of the following (in thousands): December 31, 2017 December 31, 2016 Land $ 1,023 $ — Buildings 764 — Leasehold improvements 15,673 14,592 Equipment 21,904 15,214 Furniture and fixtures 4,272 3,218 Construction in progress 2,581 1,264 Total property, plant and equipment 46,217 34,288 Less: accumulated depreciation (23,800 ) (19,332 ) Property, plant and equipment, net $ 22,417 $ 14,956 Depreciation expense totaled approximately $4,237,000, $3,269,000 and $2,996,000 in the fiscal years ended December 31, 2017, 2016 and 2015, respectively. |
Accrued Liabilities
Accrued Liabilities | 12 Months Ended |
Dec. 31, 2017 | |
Accrued Liabilities | 9. Accrued Liabilities Accrued liabilities consist of the following (in thousands): December 31, 2017 December 31, 2016 Employee compensation $ 9,560 $ 5,586 Taxes 1,668 1,692 Royalty and license fees 1,383 248 Contingent consideration — 6,119 Accrued purchases 1,191 382 Professional fees 947 411 Unearned revenue 960 408 Other accrued expenses 2,220 1,168 Total $ 17,929 $ 16,014 |
Convertible Senior Notes
Convertible Senior Notes | 12 Months Ended |
Dec. 31, 2017 | |
Convertible Senior Notes | 10. Convertible Senior Notes The carrying value of the Company’s convertible senior notes is as follows: December 31, 2017 December 31, 2016 2.125% Convertible Senior Notes due 2021: Principal amount $ 115,000 $ 115,000 Unamortized debt discount (13,395 ) (16,777 ) Unamortized debt issuance costs (2,355 ) (2,951 ) Total convertible senior notes $ 99,250 $ 95,272 On May 24, 2016, the Company issued $115 million aggregate principal amount of its 2.125% Convertible Senior Notes due 2021 (the “Notes”). The net proceeds from the sale of the Notes, after deducting the underwriting discounts and commissions and other related offering expenses, were approximately $111.1 million. The Notes bear interest at the rate of 2.125% per annum, payable semiannually in arrears on June 1 and December 1 of each year, beginning on December 1, 2016. The Notes will mature on June 1, 2021, unless earlier repurchased, redeemed or converted in accordance with their terms. Prior to March 1, 2021, the Notes will be convertible at the option of holders of the Notes only upon satisfaction of certain conditions and during certain periods, and thereafter, the notes will be convertible at any time until the close of business on the second scheduled trading day immediately preceding the maturity date. Upon conversion, holders of the Notes will receive shares of the Company’s common stock, cash or a combination thereof, at the Company’s election. It is the Company’s current intent and policy to settle all conversions through combination settlement, which involves satisfying the principal amount outstanding with cash and any note conversion value over the principal amount in shares of the Company’s common stock. During the third quarter of 2017, the closing price of the Company’s common stock exceeded 130% of the conversion price of the Notes for more than 20 trading days of the last 30 consecutive trading days of the quarter. As a result, the Notes were convertible at the option of the holders of the Notes during the fourth quarter of 2017 and were classified as a current liability on our September 30, 2017 consolidated balance sheet. Notes with a par value of $11,000 were submitted for conversion in the fourth quarter of 2017; this conversion was settled in the first quarter of 2018. During the fourth quarter of 2017, the closing price of the Company’s common stock did not exceed 130% of the conversion price of the Notes for more than 20 trading days of the last 30 consecutive trading days of the quarter. As a result, the Notes are not convertible in the first quarter of 2018 and are classified as long term liabilities on the Company’s consolidated balance sheet as of December 31, 2017. In the event the closing price conditions are met in a future fiscal quarter, the Notes will be convertible at a holder’s option during the immediately following fiscal quarter. As of December 31, 2017, the if-converted value of the Notes exceeded the aggregate principal amount by approximately $34.5 million. The conversion rate for the Notes will initially be 31.1813 shares of the Company’s common stock per $1,000 principal amount of Notes, which is equivalent to an initial conversion price of approximately $32.07 per common share, and is subject to adjustment under the terms of the Notes. Holders of the Notes may require the Company to repurchase their Notes upon the occurrence of a fundamental change prior to maturity for cash at a repurchase price equal to 100% of the principal amount of the Notes to be repurchased plus accrued and unpaid interest, if any, to, but excluding, the repurchase date. The Company will not have the right to redeem the Notes prior to June 5, 2019, but may redeem the Notes, at its option, in whole or in part, on any business day on or after June 5, 2019 and prior to the maturity date if the last reported sale price of the Company’s common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which the Company provides written notice of redemption. The redemption price will be equal to 100% of the principal amount of the principal amount of Notes to be redeemed plus accrued and unpaid interest to, but excluding, the redemption date. The Notes contain customary terms and events of default. If an event of default (other than certain events of bankruptcy, insolvency or reorganization involving the Company) occurs and is continuing, the holders of at least 25% in aggregate principal amount of the outstanding Notes may declare 100% of the principal of, and any accrued and unpaid interest on, all of the Notes to be due and payable. Upon the occurrence of certain events of bankruptcy, insolvency or reorganization involving the Company, 100% of the principal of and accrued and unpaid interest, if any, on all of the Notes will become due and payable automatically. Notwithstanding the foregoing, the Notes provide that, to the extent the Company elects and for up to 270 days, the sole remedy for an event of default relating to certain failures by the Company to comply with certain reporting covenants consist exclusively of the right to receive additional interest on the Notes. The Company is not aware of any events of default, current events or market conditions that would allow holders to call or convert the Notes as of December 31, 2017, except as noted above. The cash conversion feature of the Notes required bifurcation from the Notes and was initially accounted for as an equity instrument classified to stockholders’ equity, as the conversion feature was determined to be clearly and closely related to the Company’s stock. Based on market data available for publicly traded, senior, unsecured corporate bonds issued by companies in the same industry and asset base and with similar maturity, the Company estimated the implied interest rate, assuming no conversion option. Assumptions used in the estimate represent what market participants would use in pricing the liability component, including market interest rates, credit standing, and yield curves, all of which are defined as Level 2 observable inputs. The estimated implied interest rate was applied to the Notes, which resulted in a fair value of the liability component of $96,289,000 upon issuance, calculated as the present value of implied future payments based on the $115 million aggregate principal amount. The equity component of the Notes was recognized as a debt discount, recorded in additional paid-in Interest expense recognized on the Notes during the year ended December 31, 2017 includes $2,444,000, $3,382,000 and $595,000 for the contractual coupon interest, the accretion of the debt discount and the amortization of the debt issuance costs, respectively. Interest expense recognized on the Notes during the year ended December 31, 2016 includes $1,473,000, $1,934,000 and $340,000 for the contractual coupon interest, the accretion of the debt discount and the amortization of the debt issuance costs, respectively. The effective interest rate on the Notes is 6.6%, which includes the interest on the Notes, amortization of the debt discount and debt issuance costs. As of December 31, 2017, the carrying value of the Notes was approximately $99.3 million and the fair value of the principal was approximately $149.5 million. The fair value of the Notes was determined based on the most recent trade activity of the Notes as of December 31, 2017. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 12 Months Ended |
Dec. 31, 2017 | |
Accumulated Other Comprehensive Income (Loss) | 11. Accumulated Other Comprehensive Income (Loss) Changes in accumulated other comprehensive income (loss) consisted of the following for the years ended December 31, 2017 and 2016 (in thousands): Unrealized gain (loss) Foreign currency Total Balance as of December 31, 2015 $ (11 ) $ (8,555 ) $ (8,566 ) Other comprehensive income (loss) 6 (5,189 ) (5,183 ) Balance as of December 31, 2016 (5 ) (13,744 ) (13,749 ) Other comprehensive income (loss) 5 7,381 7,386 Balance as of December 31, 2017 $ — $ (6,363 ) $ (6,363 ) |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Dec. 31, 2017 | |
Employee Benefit Plans | 12. Employee Benefit Plans In the U.S., the Repligen Corporation 401(k) Savings and Retirement Plan (the “401(k) Plan”) is a qualified defined contribution plan in accordance with Section 401(k) of the Internal Revenue Code. All U.S. employees over the age of 21 are eligible to make pre-tax In Sweden, the Company contributes to a government-mandated occupational pension plan that is a qualified defined contribution plan. All employees in Sweden are eligible for this pension plan. The Company pays premiums to a third party occupational pension specialist who administers the pension plan. These premiums are based on various factors including each employee’s age, salary, employment history and selected benefits in the pension plan. When an employee terminates or retires, these premium payments cease for that employee and the Company has no further pension-related obligations for that employee. For the fiscal years ended December 31, 2017, 2016 and 2015, the Company contributed approximately $539,000, $519,000 and $485,000, respectively, to the pension plan. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2017 | |
Related Party Transactions | 13. Related Party Transactions In July 2017, in conjunction with the Spectrum Acquisition, the Board of Directors engaged one of the Company’s independent directors to serve as the chairperson of the Spectrum Integration Committee. In this role, this Director will work directly with the Company’s executive team on general integration strategy and focus on the integration of Spectrum’s operations and commercial organization with the Company. The Company has recorded approximately $190,000 of expense for the year ended December 31, 2017 related to this director’s services. Additionally, certain facilities leased by Spectrum are owned by the former owner of Spectrum, who currently holds greater than 10% of the Company’s outstanding common stock. The lease amounts paid to this shareholder were negotiated in connection with the Spectrum Acquisition. The Company has incurred rent expense totaling $334,000 for the year ended December 31, 2017 related to these leases. |
Selected Quarterly Financial Da
Selected Quarterly Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2017 | |
Selected Quarterly Financial Data (Unaudited) | 14. Selected Quarterly Financial Data (Unaudited) The following table contains consolidated statements of operations information for each of the previous eight quarters. The Company believes that the following information reflects all normal recurring adjustments necessary for a fair presentation of the information for the periods presented. The operating results for any quarter are not necessarily indicative of results for any future period. December 31, September 30, June 30, March 31, December 31, September 30, June 30, March 31, (in thousands, except per share amounts) Revenue: Product revenue $ 41,572 $ 36,514 $ 32,434 $ 30,569 $ 25,500 $ 24,677 $ 29,170 $ 25,094 Royalty and other revenue 39 66 21 21 100 — — — Total revenue 41,611 36,580 32,455 30,590 25,600 24,677 29,170 25,094 Operating expenses: Cost of product revenue 19,136 19,987 13,937 13,990 12,162 11,242 12,644 11,069 Research and development 3,069 2,001 1,860 1,742 2,040 1,886 1,890 1,539 Selling, general and administrative 16,144 14,998 11,185 9,182 8,568 7,127 8,140 7,018 Contingent consideration – fair value adjustments — — — — (75 ) 675 637 2,005 Total operating expenses 38,349 36,986 26,982 24,914 22,695 20,930 23,311 21,631 Income (loss) from operations 3,262 (406 ) 5,473 5,676 2,905 3,747 5,859 3,463 Investment income 63 102 110 96 112 97 76 61 Interest expense (1,637 ) (1,618 ) (1,601 ) (1,585 ) (1,570 ) (1,555 ) (638 ) (5 ) Other income (expense) (139 ) (100 ) (328 ) (120 ) 119 (75 ) 75 (979 ) Income (loss) before income taxes 1,549 (2,022 ) 3,654 4,067 1,566 2,214 5,372 2,540 Income tax provision (benefit) (10,629 ) (6,691 ) (4,784 ) 999 (3,463 ) 1,059 1,500 915 Net income (loss) $ 12,178 $ 4,669 $ 8,438 $ 3,068 $ 5,029 $ 1,155 $ 3,872 $ 1,625 Earnings per share: Basic $ 0.28 $ 0.11 $ 0.25 $ 0.09 $ 0.15 $ 0.03 $ 0.12 $ 0.05 Diluted $ 0.27 $ 0.11 $ 0.24 $ 0.09 $ 0.15 $ 0.03 $ 0.11 $ 0.05 Weighted average shares outstanding: Basic 43,569 41,237 34,098 33,892 33,833 33,779 33,649 33,025 Diluted 44,385 42,563 35,095 34,382 34,369 34,313 34,175 33,494 |
Summary of Significant Accoun23
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Significant estimates and assumptions by management affect the Company’s revenue recognition for multiple element arrangements, allowance for doubtful accounts, the net realizable value of inventory, estimated fair value of cost method investments, valuations and purchase price allocations related to business combinations, expected future cash flows including growth rates, discount rates, terminal values and other assumptions and estimates used to evaluate the recoverability of long-lived assets, estimated fair values of intangible assets and goodwill, amortization methods and periods, warranty reserves, certain accrued expenses, stock-based compensation, fair value estimates of contingent consideration, contingent liabilities, tax reserves and recoverability of the Company’s net deferred tax assets and related valuation allowance. Although the Company regularly assesses these estimates, actual results could differ materially from these estimates. Changes in estimates are recorded in the period in which they become known. The Company bases its estimates on historical experience and various other assumptions that it believes to be reasonable under the circumstances. |
Consolidation | Consolidation The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Repligen Sweden AB, Repligen GmbH, Spectrum LifeSciences LLC and its subsidiaries (“Spectrum,” acquired on August 1, 2017), TangenX Technology Corporation (“TangenX,” acquired on December 14, 2016 and merged into and with the Company as of June 30, 2017) and Repligen Singapore Pte. Ltd. All significant intercompany accounts and transactions have been eliminated in consolidation. |
Foreign Currency | Foreign Currency The Company translates the assets and liabilities of its foreign subsidiary at rates in effect at the end of the reporting period. Revenues and expenses are translated at average rates in effect during the reporting period. Translation adjustments, including adjustments related to the Company’s intercompany loan with Repligen Sweden and Repligen Sweden’s intercompany loan with Repligen GmbH, are remeasured at each period end and included in accumulated other comprehensive income. |
Revenue Recognition | Revenue Recognition Product Sales The Company’s revenue recognition policy is to recognize revenues from product sales and services in accordance with ASC 605, Revenue Recognition. These standards require that revenues are recognized when persuasive evidence of an arrangement exists, product delivery, including customer acceptance, has occurred or services have been rendered, the price is fixed or determinable and collectability is reasonably assured. Determination of whether these criteria have been met are based on management’s judgments primarily regarding the fixed nature of the fee charged for the product delivered and the collectability of those fees. The Company has a few longstanding customers who comprise the majority of revenue and have excellent payment histories and therefore the Company does not require collateral. The Company has had no significant write-offs of uncollectible invoices in the periods presented. When more than one element such as equipment, consumables, and services are contained in a single arrangement, the Company allocates revenue between the elements based on each element’s relative selling price, provided that each element meets the criteria for treatment as a separate unit of accounting. An item is considered a separate unit of accounting if it has value to the customer on a stand-alone basis. The selling price of the undelivered elements is determined by the price charged when the element is sold separately, or in cases when the item is not sold separately, by third-party evidence of selling price or management’s best estimate of selling price. The Company’s product revenues are from the sale of bioprocessing products, equipment devices, and related consumables used with these equipment devices to customers in the life science and biopharmaceutical industries. On product sales to end customers, revenue is recognized, net of discounts, when both the title and risk of loss have transferred to the customer, as determined by the shipping terms provided there are no uncertainties regarding acceptance, and all obligations have been completed. Generally, our product arrangements for equipment sales are multiple element arrangements, and may include services, such as installation and training, and multiple products, such as consumables and spare parts. In accordance with ASC 605-25, At the time of sale, the Company also evaluates the need to accrue for warranty and sales returns. The supply agreements the Company has with its customers and the related purchase orders identify the terms and conditions of each sale and the price of the goods ordered. Due to the nature of the sales arrangements, inventory produced for sale is tested for quality specifications prior to shipment. Since the product is manufactured to order and in compliance with required specifications prior to shipment, the likelihood of sales return, warranty or other issues is largely diminished. Furthermore, there is no customer right of return in our sales agreements. Sales returns and warranty issues are infrequent and have not had a material impact on the Company’s financial statements historically. Shipping and handling fees are recorded as a component of product revenue, with the associated costs recorded as a component of cost of product revenue. Sale of Intellectual Property to BioMarin In January 2014, the Company entered into an asset purchase agreement (the “Asset Purchase Agreement”) with BioMarin Pharmaceutical Inc. (“BioMarin”) to sell Repligen’s histone deacetylase inhibitor (HDACi) portfolio. The Company is entitled to receive up to $160 million in potential future milestone payments for the development, regulatory approval and commercial sale of portfolio compounds included in the agreement. These potential milestone payments are approximately 37% related to clinical development and 63% related to initial commercial sales in specific geographies. In addition, Repligen is eligible to receive royalties on sales of therapeutic products originating from the HDACi portfolio. The royalty rates are tiered and begin in the mid-single-digits non-HDACi |
Risks and Uncertainties | Risks and Uncertainties The Company evaluates its operations periodically to determine if any risks and uncertainties exist that could impact its operations in the near term. The Company does not believe that there are any significant risks which have not already been disclosed in the consolidated financial statements. A loss of certain suppliers could temporarily disrupt operations, although alternate sources of supply exist for these items. The Company has mitigated these risks by working closely with key suppliers, identifying alternate sources and developing contingency plans. |
Cash, Cash Equivalents and Marketable Securities | Cash, Cash Equivalents and Marketable Securities At December 31, 2016, the Company’s investments included money market funds and short-term marketable securities. There were no such investments as of December 31, 2017. Short-term marketable securities are investments with original maturities of greater than 90 days. Long-term marketable securities are securities with maturities of greater than one year at the original date of purchase. Investments in debt securities consisted of the following at December 31, 2016 (in thousands): Amortized Cost Gross Unrealized Gain Gross Unrealized Loss Fair Value Marketable securities: U.S. Government and agency securities $ 807 $ — $ — $ 807 Corporate and other debt securities 18,745 2 (7 ) 18,740 Total $ 19,552 $ 2 $ (7 ) $ 19,547 There were no long-term marketable securities as of December 31, 2016. There were no realized gains or losses on the investments for the fiscal years ended December 31, 2017, 2016 and 2015. |
Fair Value Measurement | Fair Value Measurement In determining the fair value of its assets and liabilities, the Company uses various valuation approaches. The Company employs a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the inputs that market participants would use in pricing the asset or liability and are developed based on the best information available in the circumstances. The fair value hierarchy is broken down into three levels based on the source of inputs as follows: Level 1 – Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access. Level 2 – Valuations based on quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active and models for which all significant inputs are observable, either directly or indirectly. Level 3 – Valuations based on inputs that are unobservable and significant to the overall fair value measurement. The availability of observable inputs can vary among the various types of financial assets and liabilities. To the extent that the valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for financial statement disclosure purposes, the level in the fair value hierarchy within which the fair value measurement is categorized is based on the lowest level input that is significant to the overall fair value measurement. The Company’s fixed income investments were historically comprised of obligations of U.S. government agencies, corporate debt securities and other interest bearing securities. These investments have been initially valued at the transaction price and subsequently valued, at the end of each reporting period, utilizing third party pricing services or other market observable data. The pricing services utilize industry standard valuation models, including both income and market based approaches and observable market inputs to determine value. These observable market inputs include reportable trades, benchmark yields, credit spreads, broker/dealer quotes, bids, offers, current spot rates and other industry and economic events. The Company validates the prices provided by third party pricing services by reviewing their pricing methods and matrices, obtaining market values from other pricing sources, analyzing pricing data in certain instances and confirming that the relevant markets are active. After completing its validation procedures, the Company did not adjust or override any fair value measurements provided by the pricing services as of December 31, 2017. As of December 31, 2017, the Company had no assets or liabilities for which fair value measurement is either required or has been elected to be applied. As of December 31, 2016, the Company had accrued liabilities with a fair value of $6,119,000 related to contingent consideration in connection with the Refine and Atoll business combinations. The contingent consideration related to Refine was based on actual 2016 revenues. The contingent consideration related to Atoll was based on meeting revenue growth targets in 2016. These valuations were Level 3 valuations, as the primary inputs are unobservable. All contingent consideration liabilities were paid in the first quarter of 2017. The following table provides a rollforward of the fair value of contingent consideration (in thousands): Balance at December 31, 2016 $ 6,119 Payments (6,119 ) Balance at December 31, 2017 $ — In May 2016, the Company issued $115 million aggregate principal amount of the Notes due June 1, 2021. Interest is payable semi-annually in arrears on June 1 and December 1 of each year, beginning on December 1, 2016. As of December 31, 2017, the carrying value of the Notes was $99.3 million, net of unamortized discount, and the fair value of the Notes was approximately $149.5 million. The fair value of the Notes is a Level 1 valuation and was determined based on the most recent trade activity of the Notes as of December 31, 2017. The Notes are discussed in more detail in Note 10, “Convertible Senior Notes . There were no remeasurements to fair value during the year ended December 31, 2017 of financial assets and liabilities that are not measured at fair value on a recurring basis. |
Inventories | Inventories Inventories relate to the Company’s bioprocessing business. The Company values inventory at cost or, if lower, net realizable value, using the first-in, first-out work-in-process A change in the estimated timing or amount of demand for the Company’s products could result in additional provisions for excess inventory quantities on hand. Any significant unanticipated changes in demand or unexpected quality failures could have a significant impact on the value of inventory and reported operating results. During all periods presented in the accompanying financial statements, there have been no material adjustments related to a revised estimate of inventory valuations. Work-in-process Inventories consist of the following (in thousands): December 31, December 31, Raw Materials $ 22,351 $ 14,954 Work-in-process 4,083 2,789 Finished products 12,570 6,953 Total $ 39,004 $ 24,696 |
Accrued Liabilities | Accrued Liabilities The Company estimates accrued liabilities by identifying services performed on the Company’s behalf, estimating the level of service performed and determining the associated cost incurred for such service as of each balance sheet date. For example, the Company would accrue for professional and consulting fees incurred with law firms, audit and accounting service providers and other third party consultants. These expenses are determined by either requesting those service providers to estimate unbilled services at each reporting date for services incurred or tracking costs incurred by service providers under fixed fee arrangements. The Company has processes in place to estimate the appropriate amounts to record for accrued liabilities, which principally involve the applicable personnel reviewing the services provided. In the event that the Company does not identify certain costs that have begun to be incurred or the Company under or over-estimates the level of services performed or the costs of such services, the reported expenses for that period may be too low or too high. The date on which certain services commence, the level of services performed on or before a given date, and the cost of such services often require the exercise of judgment. The Company makes these judgments based upon the facts and circumstances known at the date of the financial statements. |
Income Taxes | Income Taxes Deferred taxes are determined based on the difference between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse. Valuation allowances are provided, if, based upon the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. The Company accounts for uncertain tax positions using a “more-likely-than-not” |
Property, Plant & Equipment | Property, Plant & Equipment Property, Plant & Equipment is recorded at cost less allowances for depreciation. Depreciation is calculated using the straight-line method over the estimated useful life of the asset as follows: Classification Estimated Useful Life Buildings Thirty years Leasehold improvements Shorter of the term of the lease or estimated useful life Equipment Three to twelve years Furniture and fixtures Three to eight years |
Earnings Per Share | Earnings Per Share Basic earnings per share is computed by dividing net income available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed by dividing net income available to common shareholders by the weighted-average number of common shares and dilutive common share equivalents then outstanding. Potential common share equivalents consist of restricted stock awards and the incremental common shares issuable upon the exercise of stock options and warrants. Under the treasury stock method, unexercised “in-the-money” non-forfeitable A reconciliation of basic and diluted share amounts is as follows: Years ended December 31, 2017 2016 2015 Numerator: Net income $ 28,353,000 $ 11,681,000 $ 9,345,000 Denominator: Basic weighted average common shares outstanding 38,233,527 33,572,883 32,881,940 Effect of dilutive securities: Stock options and restricted stock awards 441,924 526,015 695,151 Convertible senior notes 474,923 — — Diluted weighted average common shares outstanding 39,150,374 34,098,898 33,577,091 Basic net income per common share $ 0.74 $ 0.35 $ 0.28 Diluted net income per common share $ 0.72 $ 0.34 $ 0.28 At December 31, 2017, there were outstanding options to purchase 734,940 shares of the Company’s common stock at a weighted average exercise price of $20.80 per share and 505,235 shares of common stock issuable upon the vesting of restricted stock units. For the fiscal year ended December 31, 2017, 317,923 shares of the Company’s common stock were excluded from the calculation of diluted earnings per share because the exercise prices of the stock options were greater than or equal to the average price of the common shares, and were therefore anti-dilutive. As provided by the terms of the indenture underlying the senior convertible notes, the Company has a choice to settle the conversion obligation for the Convertible Notes in cash, shares or any combination of the two. The Company currently intends to settle the par value of the Convertible Notes in cash and any excess conversion premium in shares. The Company applies the provisions of ASC 260, Earnings Per Share, 10-45-44, At December 31, 2016, there were outstanding options to purchase 1,236,586 shares of the Company’s common stock at a weighted average exercise price of $12.05 per share. For the fiscal year ended December 31, 2016, 381,686 shares of the Company’s common stock were excluded from the calculation of diluted earnings per share because the exercise prices of the stock options were greater than or equal to the average price of the common shares, and were therefore anti-dilutive. At December 31, 2015, there were outstanding options to purchase 1,240,935 shares of the Company’s common stock at a weighted average exercise price of $10.44 per share. For the fiscal year ended December 31, 2015, 196,209 shares of the Company’s common stock were excluded from the calculation of diluted earnings per share because the exercise prices of the stock options were greater than or equal to the average price of the common shares, and were therefore anti-dilutive. |
Segment Reporting | Segment Reporting The Company views its operations, makes decisions regarding how to allocate resources and manages its business as one operating segment and two reporting units. As a result, the financial information disclosed herein represents all of the material financial information related to the Company. The following table represents product revenues by product line (in thousands): December 31, 2017 December 31, 2016 December 31, 2015 Protein products $ 53,969 $ 54,716 $ 52,938 Filtration products 49,050 (3) 19,774 (1) 15,676 Chromatography products 36,309 (3) 29,520 (2) 14,613 Other 1,761 (3) 431 310 Total product revenues $ 141,089 $ 104,441 $ 83,537 (1) 2016 revenue for filtration products includes revenue related to TangenX from December 14, 2016 through December 31, 2016. (2) 2016 revenue for chromatography products includes revenue related to Atoll from April 1, 2016 through December 31, 2016. (3) 2017 revenue for filtration, chromatography and other products includes revenue related to Spectrum from August 1, 2017 through December 31, 2017. Revenue from protein products includes the Company’s Protein A ligands and cell culture growth factors. Revenue from filtration products includes the Company’s XCell ATF Systems and consumables and Sius filtration products. Revenue from chromatography products includes the Company’s OPUS and OPUS PD chromatography columns, chromatography resins and ELISA test kits. Other revenue primarily consists of freight revenues. The following table represents the Company’s total revenue by geographic area (based on the location of the customer): Years ended December 31, 2017 2016 2015 United States 43 % 39 % 28 % Sweden 20 % 29 % 37 % United Kingdom 4 % 7 % 17 % Other 33 % 25 % 18 % Total 100 % 100 % 100 % The following table represents the Company’s total assets by geographic area (in thousands): December 31, December 31, United States $ 654,673 $ 209,728 Europe 85,169 79,145 Asia 3,677 40 Total $ 743,519 $ 288,913 The following table represents the Company’s long-lived assets by geographic area (in thousands): December 31, December 31, United States $ 465,453 $ 77,039 Europe 34,430 27,721 Asia 854 — Total $ 500,737 $ 104,760 |
Concentrations of Credit Risk and Significant Customers | Concentrations of Credit Risk and Significant Customers Financial instruments that subject the Company to significant concentrations of credit risk primarily consist of cash and cash equivalents, marketable securities and accounts receivable. Per the Company’s investment policy, cash equivalents and marketable securities are invested in financial instruments with high credit ratings and credit exposure to any one issue, issuer (with the exception of U.S. treasury obligations) and type of instrument is limited. At December 31, 2017 and 2016, the Company had no investments associated with foreign exchange contracts, options contracts or other foreign hedging arrangements. Concentration of credit risk with respect to accounts receivable is limited to customers to whom the Company makes significant sales. While a reserve for the potential write-off Revenue from significant customers as a percentage of the Company’s total revenue is as follows: Years ended December 31, 2017 2016 2015 GE Healthcare 21 % 29 % 37 % MilliporeSigma 18 % 28 % 29 % Significant accounts receivable balances as a percentage of the Company’s total trade accounts receivable and royalties and other receivable balances are as follows: December 31, 2017 December 31, 2016 GE Healthcare 11 % 26 % MilliporeSigma 19 % 8 % |
Goodwill, Other Intangible Assets and Acquisitions | Goodwill, Other Intangible Assets and Acquisitions Acquisitions Total consideration transferred for acquisitions is allocated to the assets acquired and liabilities assumed, if any, based on their fair values at the dates of acquisition. The fair value of identifiable intangible assets is based on detailed valuations that use information and assumptions determined by management. Any excess of purchase price over the fair value of the net tangible and intangible assets acquired is allocated to goodwill. Any excess of the fair value of the net tangible and intangible assets acquired over the purchase price is recognized in the statement of operations. The fair value of contingent consideration includes estimates and judgments made by management regarding the probability that future contingent payments will be made and the extent of royalties to be earned in excess of the defined minimum royalties. Management updates these estimates and the related fair value of contingent consideration at each reporting period. Changes in the fair value of contingent consideration are recorded in the consolidated statements of operations. The Company uses the income approach to determine the fair value of certain identifiable intangible assets including customer relationships and developed technology. This approach determines fair value by estimating after-tax after-tax Goodwill Goodwill is not amortized and is reviewed for impairment at least annually. There was no evidence of impairment to goodwill at December 31, 2017 and 2016. There were no goodwill impairment charges during the fiscal years ended December 31, 2017, 2016 and 2015. Intangible Assets Intangible assets are amortized over their useful lives using the estimated economic benefit method, as applicable, and the amortization expense is recorded within cost of product revenue and selling, general and administrative expense in the statements of operations. Intangible assets and their related useful lives are reviewed at least annually to determine if any adverse conditions exist that would indicate the carrying value of these assets may not be recoverable. More frequent impairment assessments are conducted if certain conditions exist, including a change in the competitive landscape, any internal decisions to pursue new or different technology strategies, a loss of a significant customer, or a significant change in the marketplace, including changes in the prices paid for our products or changes in the size of the market for our products. If impairment indicators are present, the Company determines whether the underlying intangible asset is recoverable through estimated future undiscounted cash flows. If the asset is not found to be recoverable, it is written down to the estimated fair value of the asset based on the sum of the future discounted cash flows expected to result from the use and disposition of the asset. If the estimate of an intangible asset’s remaining useful life is changed, the remaining carrying amount of the intangible asset is amortized prospectively over the revised remaining useful life. The Company continues to believe that its intangible assets are recoverable at December 31, 2017. Intangible assets consisted of the following at December 31, 2017 (in thousands): Gross Carrying Accumulated Weighted Technology – developed $ 51,801 $ (3,201 ) 19 Patents 240 (238 ) 8 Customer relationships 102,120 (9,636 ) 14 Trademarks – definite lived 2,160 (47 ) 20 Trademarks – indefinite lived 700 — — Other intangibles 1,063 (209 ) 3 Total intangible assets $ 158,084 $ (13,331 ) 16 Intangible assets consisted of the following at December 31, 2016 (in thousands): Gross Carrying Accumulated Weighted Technology – developed $ 12,911 $ (1,468 ) 17 Patents 240 (208 ) 8 Customer relationships 22,555 (4,995 ) 11 Trademark/ tradename 711 — — Other intangibles 84 (24 ) 2 Total intangible assets $ 36,501 $ (6,695 ) 13 Amortization expense for amortized intangible assets was approximately $6,215,000, $2,052,000 and $1,600,000 for the years ended December 31, 2017, 2016 and 2015, respectively. As of December 31, 2017, the Company expects to record the following amortization expense (in thousands): Year Ending Amortization Expense December 31, 2018 $ 10,633 December 31, 2019 10,578 December 31, 2020 9,894 December 31, 2021 9,376 December 31, 2022 9,374 |
Stock Based Compensation | Stock Based Compensation The Company measures stock-based compensation cost at the grant date based on the estimated fair value of the award, and recognizes it as expense over the employee’s requisite service period on a straight-line basis. The Company records the expense for share-based awards subject to performance-based milestone vesting over the remaining service period when management determines that achievement of the milestone is probable. Management evaluates whether the achievement of a performance-based milestone is probable as of the reporting date. The Company has no awards that are subject to market conditions. The Company recognizes stock-based compensation expense based upon options that are ultimately expected to vest, and accordingly, such compensation expense has been adjusted by an amount of estimated forfeitures. The Company uses the Black-Scholes option pricing model to calculate the fair value of share-based awards on the grant date. The following assumptions are used in calculating the fair value of share-based awards: Expected term Expected volatility Risk-free interest rate zero-coupon Expected dividend yield Estimated forfeiture rates non-executive non-employee |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In May 2014, the FASB issued ASU No. 2014-09, Revenue Recognition Revenue from Contracts with Customers 2015-14, 2016-08, 2016-10, 2016-12, In July 2015, the FASB issued ASU No. 2015-11, 2015-11”). 2015-11 2015-11 2015-11 In February 2016, the FASB issued ASU No. 2016-02, “Leases 2016-02”). 2016-02 right-of-use right-of-use In March 2016, the FASB issued ASU No. 2016-09, “Compensation—Stock 2016-09 In August 2016, the FASB issued ASU No. 2016-15, No. 2016-15 No. 2016-15 2016-15 In November 2016, the FASB issued ASU No. 2016-18, “Statement of Cash Flows (Topic 230): Restricted Cash,” which requires that the statement of cash flows explain the change during the period in the total cash, which is inclusive of cash and cash equivalents and amounts generally described as restricted cash or restricted cash equivalents. Restricted cash and restricted cash equivalents will be included with cash and cash equivalents when reconciling the beginning of period and end of period balances on the statement of cash flows upon adoption of this standard. The ASU is effective for the Company on January 1, 2018 with early adoption permitted. The Company intends to adopt the ASU on January 1, 2018. Upon adoption, the ASU requires retrospective application. Beginning in 2018, the Company will include $450,000 of restricted cash with total cash and cash equivalents in its 2016 and 2017 cash flow statements. |
Summary of Significant Accoun24
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Investments in Debt Securities | Investments in debt securities consisted of the following at December 31, 2016 (in thousands): Amortized Cost Gross Unrealized Gain Gross Unrealized Loss Fair Value Marketable securities: U.S. Government and agency securities $ 807 $ — $ — $ 807 Corporate and other debt securities 18,745 2 (7 ) 18,740 Total $ 19,552 $ 2 $ (7 ) $ 19,547 |
RollForward of Fair Value of Contingent Consideration | The following table provides a rollforward of the fair value of contingent consideration (in thousands): Balance at December 31, 2016 $ 6,119 Payments (6,119 ) Balance at December 31, 2017 $ — |
Schedule of Inventories | Inventories consist of the following (in thousands): December 31, December 31, Raw Materials $ 22,351 $ 14,954 Work-in-process 4,083 2,789 Finished products 12,570 6,953 Total $ 39,004 $ 24,696 |
Reconciliation of Basic and Diluted Shares Amounts | A reconciliation of basic and diluted share amounts is as follows: Years ended December 31, 2017 2016 2015 Numerator: Net income $ 28,353,000 $ 11,681,000 $ 9,345,000 Denominator: Basic weighted average common shares outstanding 38,233,527 33,572,883 32,881,940 Effect of dilutive securities: Stock options and restricted stock awards 441,924 526,015 695,151 Convertible senior notes 474,923 — — Diluted weighted average common shares outstanding 39,150,374 34,098,898 33,577,091 Basic net income per common share $ 0.74 $ 0.35 $ 0.28 Diluted net income per common share $ 0.72 $ 0.34 $ 0.28 |
Summary of Product Revenues by Product Line | The following table represents product revenues by product line (in thousands): December 31, 2017 December 31, 2016 December 31, 2015 Protein products $ 53,969 $ 54,716 $ 52,938 Filtration products 49,050 (3) 19,774 (1) 15,676 Chromatography products 36,309 (3) 29,520 (2) 14,613 Other 1,761 (3) 431 310 Total product revenues $ 141,089 $ 104,441 $ 83,537 (1) 2016 revenue for filtration products includes revenue related to TangenX from December 14, 2016 through December 31, 2016. (2) 2016 revenue for chromatography products includes revenue related to Atoll from April 1, 2016 through December 31, 2016. (3) 2017 revenue for filtration, chromatography and other products includes revenue related to Spectrum from August 1, 2017 through December 31, 2017. |
Total Assets by Geographic Area | The following table represents the Company’s total assets by geographic area (in thousands): December 31, December 31, United States $ 654,673 $ 209,728 Europe 85,169 79,145 Asia 3,677 40 Total $ 743,519 $ 288,913 |
Long Lived Assets by Geographic Area | The following table represents the Company’s long-lived assets by geographic area (in thousands): December 31, December 31, United States $ 465,453 $ 77,039 Europe 34,430 27,721 Asia 854 — Total $ 500,737 $ 104,760 |
Percentage of Revenue from Significant Customers | Revenue from significant customers as a percentage of the Company’s total revenue is as follows: Years ended December 31, 2017 2016 2015 GE Healthcare 21 % 29 % 37 % MilliporeSigma 18 % 28 % 29 % |
Intangible assets | Intangible assets consisted of the following at December 31, 2017 (in thousands): Gross Carrying Accumulated Weighted Technology – developed $ 51,801 $ (3,201 ) 19 Patents 240 (238 ) 8 Customer relationships 102,120 (9,636 ) 14 Trademarks – definite lived 2,160 (47 ) 20 Trademarks – indefinite lived 700 — — Other intangibles 1,063 (209 ) 3 Total intangible assets $ 158,084 $ (13,331 ) 16 Intangible assets consisted of the following at December 31, 2016 (in thousands): Gross Carrying Accumulated Weighted Technology – developed $ 12,911 $ (1,468 ) 17 Patents 240 (208 ) 8 Customer relationships 22,555 (4,995 ) 11 Trademark/ tradename 711 — — Other intangibles 84 (24 ) 2 Total intangible assets $ 36,501 $ (6,695 ) 13 |
Schedule of Amortization Expense for Amortized Intangible Assets | As of December 31, 2017, the Company expects to record the following amortization expense (in thousands): Year Ending Amortization Expense December 31, 2018 $ 10,633 December 31, 2019 10,578 December 31, 2020 9,894 December 31, 2021 9,376 December 31, 2022 9,374 |
Total Revenue | |
Percentage by Geographic Area or Significant Customers | The following table represents the Company’s total revenue by geographic area (based on the location of the customer): Years ended December 31, 2017 2016 2015 United States 43 % 39 % 28 % Sweden 20 % 29 % 37 % United Kingdom 4 % 7 % 17 % Other 33 % 25 % 18 % Total 100 % 100 % 100 % |
Accounts Receivable | |
Percentage by Geographic Area or Significant Customers | Significant accounts receivable balances as a percentage of the Company’s total trade accounts receivable and royalties and other receivable balances are as follows: December 31, 2017 December 31, 2016 GE Healthcare 11 % 26 % MilliporeSigma 19 % 8 % |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment | Property, plant and equipment consist of the following (in thousands): December 31, 2017 December 31, 2016 Land $ 1,023 $ — Buildings 764 — Leasehold improvements 15,673 14,592 Equipment 21,904 15,214 Furniture and fixtures 4,272 3,218 Construction in progress 2,581 1,264 Total property, plant and equipment 46,217 34,288 Less: accumulated depreciation (23,800 ) (19,332 ) Property, plant and equipment, net $ 22,417 $ 14,956 |
Estimated Useful Life | |
Property, Plant and Equipment | Depreciation is calculated using the straight-line method over the estimated useful life of the asset as follows: Classification Estimated Useful Life Buildings Thirty years Leasehold improvements Shorter of the term of the lease or estimated useful life Equipment Three to twelve years Furniture and fixtures Three to eight years |
Acquisitions, Goodwill and Ot26
Acquisitions, Goodwill and Other Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Changes in Carrying Value of Goodwill | The changes in the carrying value of goodwill for the year ended December 31, 2017 is as follows (in thousands): Balance at December 31, 2016 $ 59,548 Goodwill adjustments arising from the TangenX Acquisition 85 Goodwill arising from the Spectrum Acquisition 265,519 Foreign currency adjustments on goodwill from the Atoll Acquisition 2,181 Balance at December 31, 2017 $ 327,333 |
Spectrum Inc. | |
Consideration Transferred | The total consideration transferred follows (in thousands): Cash consideration $ 122,932 Equity consideration 247,575 Working capital adjustment 425 Net assets acquired $ 370,932 |
Components and Allocation of Purchase Price | The components and allocation of the purchase price consists of the following amounts (in thousands): Cash and cash equivalents $ 10,137 Accounts receivable 5,075 Inventory 13,705 Prepaid expenses and other assets 616 Fixed assets 6,004 Deferred tax assets 1,102 Customer relationships 78,400 Developed technology 38,560 Trademark and tradename 2,160 Non-competition agreements 960 Goodwill 265,519 Accounts payable (1,335 ) Unrecognized tax benefit (576 ) Accrued liabilities (5,787 ) Deferred tax liabilities (43,608 ) Fair value of net assets acquired $ 370,932 |
Spectrum Inc and TangenX Technology Corporation | |
Unaudited Supplemental Pro Forma Information | The following table presents unaudited supplemental pro forma information as if both the Spectrum Acquisition had occurred as of January 1, 2016 and the TangenX Acquisition had occurred as of January 1, 2015 (in thousands, except per share data): December 31, 2017 December 31, 2016 Total revenue 162,913 145,994 Net income (loss) 17,220 (12,656 ) Earnings (loss) per share: Basic $ 0.41 $ (0.32 ) Diluted $ 0.40 $ (0.32 ) |
TangenX Technology Corporation | |
Consideration Transferred | The total consideration transferred follows (in thousands): Cash consideration $ 37,532 Less: working capital adjustment (382 ) Net assets acquired $ 37,150 |
Components and Allocation of Purchase Price | The components and allocation of the purchase price consists of the following amounts (in thousands): Cash and cash equivalents $ 1,218 Accounts receivable 459 Other receivables 111 Inventory 936 Other current assets 50 Fixed assets, net 215 Customer relationships 6,192 Developed technology 6,044 Non-competition 21 Trademark and trade name 11 Accounts payable and other liabilities assumed (3,083 ) Deferred tax liabilities (4,525 ) Goodwill 29,501 Net assets acquired $ 37,150 |
Unaudited Supplemental Pro Forma Information | The following table presents unaudited supplemental pro forma information as if the TangenX Acquisition had occurred as of January 1, 2015 (in thousands, except per share data): December 31, 2016 December 31, 2015 Total revenue 110,228 88,437 Net income 5,744 13,208 Earnings per share: Basic $ 0.17 $ 0.40 Diluted $ 0.17 $ 0.39 |
Atoll GmbH | |
Consideration Transferred | The total consideration transferred follows (in thousands): Cash consideration, less $74 of working capital adjustments $ 10,176 Value of common stock issued 14,138 Estimated fair value of contingent consideration 952 Total consideration transferred $ 25,266 |
Components and Allocation of Purchase Price | The components and allocation of the purchase price consists of the following amounts (in thousands): Cash and cash equivalents $ 1,409 Accounts receivable 697 Inventory 155 Other current assets 169 Fixed assets 114 Customer relationships 5,318 Developed technology 2,175 Non-competition 57 Trademark and trade name 11 Deferred tax assets 885 Accounts payable and other liabilities assumed (599 ) Deferred tax liabilities (2,202 ) Goodwill 17,077 Net assets acquired $ 25,266 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Income from Operations Before Income Taxes | December 31, 2017 December 31, 2016 December 31, 2015 The components of income from operations before income taxes are as follows: Domestic $ (6,709 ) $ (4,882 ) $ (2,490 ) Foreign 13,957 16,574 15,913 Total $ 7,248 $ 11,692 $ 13,423 |
Provision for Income Taxes | December 31, 2017 December 31, 2016 December 31, 2015 The components of income from operations before income taxes are as follows: Domestic $ (6,709 ) $ (4,882 ) $ (2,490 ) Foreign 13,957 16,574 15,913 Total $ 7,248 $ 11,692 $ 13,423 The current and deferred components of the provision for income taxes on operations are as follows: Current $ 3,624 $ 4,077 $ 3,745 Deferred (24,729 ) (4,066 ) 333 Total $ (21,105 ) $ 11 $ 4,078 The jurisdictional components of the provision for income taxes on operations are as follows: Federal $ (24,012 ) $ (3,809 ) $ 295 State (438 ) (207 ) 276 Foreign 3,345 4,027 3,507 Total $ (21,105 ) $ 11 $ 4,078 |
Consolidated Deferred Tax Assets (Liabilities) | December 31, 2017 December 31, 2016 Deferred tax assets: Temporary timing differences: Stock compensation $ 1,662 $ 1,722 Contingent consideration 2,196 3,333 Other 1,704 1,895 Total temporary timing differences 5,562 6,950 Net operating loss carryforwards 4,361 12,284 Tax business credits carryforwards 1,265 2,036 Total deferred tax assets 11,188 21,270 Valuation allowance (6 ) (9,979 ) Net deferred tax assets $ 11,182 $ 11,291 Deferred tax liabilities: Goodwill and intangible assets $ (33,166 ) $ (7,346 ) Conversion option on convertible notes (3,183 ) (6,048 ) Total deferred tax liabilities $ (36,349 ) $ (13,394 ) Net deferred tax liabilities $ (25,167 ) $ (2,103 ) |
Reconciliation of Federal Statutory Rate to Effective Income Tax Rate | The reconciliation of the federal statutory rate to the effective income tax rate for the fiscal years ended December 31, 2017, 2016 and 2015 is as follows (amounts in thousands): Year Ended December 31, 2017 December 31, 2016 December 31, 2015 Income before income taxes $ 7,248 $ 11,692 $ 13,423 Expected tax at statutory rate 2,537 35.0 % 3,975 34.0 % 4,564 34.0 % Adjustments due to: Difference between U.S. and foreign tax (1,797 ) (24.8 %) (2,031 ) (17.4 %) (1,910 ) (14.2 %) State income and franchise taxes (307 ) (4.2 %) (326 ) (2.8 %) 563 4.2 % Business tax credits (7,708 ) (9.8 %) (236 ) (2.0 %) (115 ) (0.9 %) Permanent differences: Stock compensation (946 ) (13.1 %) 31 0.3 % 348 2.6 % Transaction costs 1,232 17.0 % 156 1.3 % — — Other 470 6.4 % 380 3.2 % (230 ) (1.7 %) Change in U.S. federal tax rates (12,839 ) (177.2 %) — — — — Transition tax 3,266 45.1 % — — — — Change in valuation allowance (12,164 ) (167.8 %) (1,981 ) (16.9 %) 1,216 9.1 % Other (151 ) (2.1 %) 43 0.4 % (358 ) (2.7 %) Provision for income taxes $ (21,105 ) (291.2 %) $ 11 0.1 % $ 4,078 30.4 % |
Summary of Tax Returns Periods Subject to Examination by Federal, State and International Taxing Authorities | The Company’s tax returns are subject to examination by federal, state and international taxing authorities for the following periods: Jurisdiction Fiscal years subject to examination United States – federal and state 2014-2017 Sweden 2011-2017 Germany 2016-2017 Netherlands 2012-2017 |
Reconciliation of Unrecognized Tax Benefits | The following is a tabular reconciliation of the total amounts of unrecognized tax benefits (in thousands): Unrecognized tax benefits at January 1, 2017 1,407 Gross increases – tax positions in prior period 679 Gross increases – tax positions in current period 199 Gross decreases – release (479 ) Unrecognized tax benefits at December 31, 2017 $ 1,806 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Stock-Based Compensation Expense | The following table presents stock-based compensation expense in the Company’s consolidated statements of operations (in thousands): Years ended December 31, 2017 2016 2015 Cost of product revenue $ 704 $ 341 $ 213 Research and development 481 537 336 Selling, general and administrative 5,562 3,717 3,049 Total $ 6,747 $ 4,595 $ 3,598 |
Estimated Weighted Average Assumptions | The fair value of share-based awards granted during the years ended December 31, 2017, 2016 and 2015 were calculated using the following estimated assumptions: 2017 2016 2015 Expected term (years) 6.1 6.7 – 7.1 6.6 – 7.2 Volatility 51.48% 50.85 – 51.01% 50.09 – 51.89% Risk-free interest rate 1.88 – 1.99% 1.51 – 2.37% 1.67 – 2.03% Expected dividend yield — — — |
Summary of Option Activity | Information regarding option activity for the year ended December 31, 2017 under the Plans is summarized below: Options Outstanding Weighted- Weighted- (in thousands) Options outstanding at December 31, 2016 882,748 $ 16.88 Granted 101,844 33.38 Exercised (215,495 ) 10.92 Forfeited/cancelled (34,157 ) 20.23 Options outstanding at December 31, 2017 734,940 $ 20.80 6.46 $ 11,558 Options exercisable at December 31, 2017 420,688 $ 15.86 5.28 $ 8,720 Vested and expected to vest at December 31, 2017 (1) 727,278 $ 20.71 6.44 $ 11,472 (1) Represents the number of vested options as of December 31, 2017 plus the number of unvested options expected to vest as of December 31, 2017 based on the unvested outstanding options at December 31, 2017 adjusted for estimated forfeiture rates of 8% for awards granted to non-executive |
Summary of Restricted Stock Unit Activity | Information regarding restricted stock unit activity for the year ended December 31, 2017 under the Plans is summarized below: Options Weighted- (in thousands) Restricted stock units outstanding at December 31, 2016 353,838 Granted 293,004 Vested (114,690 ) Forfeited/cancelled (26,917 ) Restricted stock units outstanding at December 31, 2017 505,235 2.65 $ 18,330 Vested and expected to vest at December 31, 2017 (1) 466,201 2.40 $ 16,914 (1) Represents the number of vested restricted stock units as of December 31, 2017 plus the number of unvested restricted stock units expected to vest as of December 31, 2017 based on the unvested outstanding restricted stock units at December 31, 2017 adjusted for estimated forfeiture rates of 8% for awards granted to non-executive |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Obligations Under Non-Cancelable Operating Leases | Obligations under non-cancelable Years Ending Operating Leases December 31, 2018 3,611 December 31, 2019 3,383 December 31, 2020 3,077 December 31, 2021 2,750 December 31, 2022 1,464 Thereafter 786 Minimum lease payments $ 15,071 |
Prepaid Expenses and Other Cu30
Prepaid Expenses and Other Current Assets (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets consist of the following (in thousands): December 31, 2017 December 31, 2016 Equipment maintenance and services $ 1,091 $ 586 Prepaid taxes 311 626 Prepaid insurance 594 356 Deferred costs 67 5 Other 218 71 Total $ 2,281 $ 1,644 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Accrued Liabilities | Accrued liabilities consist of the following (in thousands): December 31, 2017 December 31, 2016 Employee compensation $ 9,560 $ 5,586 Taxes 1,668 1,692 Royalty and license fees 1,383 248 Contingent consideration — 6,119 Accrued purchases 1,191 382 Professional fees 947 411 Unearned revenue 960 408 Other accrued expenses 2,220 1,168 Total $ 17,929 $ 16,014 |
Convertible Senior Notes (Table
Convertible Senior Notes (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Carrying Value of Convertible Senior Notes | The carrying value of the Company’s convertible senior notes is as follows: December 31, 2017 December 31, 2016 2.125% Convertible Senior Notes due 2021: Principal amount $ 115,000 $ 115,000 Unamortized debt discount (13,395 ) (16,777 ) Unamortized debt issuance costs (2,355 ) (2,951 ) Total convertible senior notes $ 99,250 $ 95,272 |
Accumulated Other Comprehensi33
Accumulated Other Comprehensive Income (Loss) (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Changes in Accumulated Other Comprehensive Income (Loss) | Changes in accumulated other comprehensive income (loss) consisted of the following for the years ended December 31, 2017 and 2016 (in thousands): Unrealized gain (loss) Foreign currency Total Balance as of December 31, 2015 $ (11 ) $ (8,555 ) $ (8,566 ) Other comprehensive income (loss) 6 (5,189 ) (5,183 ) Balance as of December 31, 2016 (5 ) (13,744 ) (13,749 ) Other comprehensive income (loss) 5 7,381 7,386 Balance as of December 31, 2017 $ — $ (6,363 ) $ (6,363 ) |
Selected Quarterly Financial 34
Selected Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Consolidated Statements of Operations Information for Each of Previous Eight Quarters | December 31, September 30, June 30, March 31, December 31, September 30, June 30, March 31, (in thousands, except per share amounts) Revenue: Product revenue $ 41,572 $ 36,514 $ 32,434 $ 30,569 $ 25,500 $ 24,677 $ 29,170 $ 25,094 Royalty and other revenue 39 66 21 21 100 — — — Total revenue 41,611 36,580 32,455 30,590 25,600 24,677 29,170 25,094 Operating expenses: Cost of product revenue 19,136 19,987 13,937 13,990 12,162 11,242 12,644 11,069 Research and development 3,069 2,001 1,860 1,742 2,040 1,886 1,890 1,539 Selling, general and administrative 16,144 14,998 11,185 9,182 8,568 7,127 8,140 7,018 Contingent consideration – fair value adjustments — — — — (75 ) 675 637 2,005 Total operating expenses 38,349 36,986 26,982 24,914 22,695 20,930 23,311 21,631 Income (loss) from operations 3,262 (406 ) 5,473 5,676 2,905 3,747 5,859 3,463 Investment income 63 102 110 96 112 97 76 61 Interest expense (1,637 ) (1,618 ) (1,601 ) (1,585 ) (1,570 ) (1,555 ) (638 ) (5 ) Other income (expense) (139 ) (100 ) (328 ) (120 ) 119 (75 ) 75 (979 ) Income (loss) before income taxes 1,549 (2,022 ) 3,654 4,067 1,566 2,214 5,372 2,540 Income tax provision (benefit) (10,629 ) (6,691 ) (4,784 ) 999 (3,463 ) 1,059 1,500 915 Net income (loss) $ 12,178 $ 4,669 $ 8,438 $ 3,068 $ 5,029 $ 1,155 $ 3,872 $ 1,625 Earnings per share: Basic $ 0.28 $ 0.11 $ 0.25 $ 0.09 $ 0.15 $ 0.03 $ 0.12 $ 0.05 Diluted $ 0.27 $ 0.11 $ 0.24 $ 0.09 $ 0.15 $ 0.03 $ 0.11 $ 0.05 Weighted average shares outstanding: Basic 43,569 41,237 34,098 33,892 33,833 33,779 33,649 33,025 Diluted 44,385 42,563 35,095 34,382 34,369 34,313 34,175 33,494 |
Summary of Significant Accoun35
Summary of Significant Accounting Policies - Additional Information (Detail) | 1 Months Ended | 12 Months Ended | |||||
Jan. 31, 2014USD ($) | Dec. 31, 2017USD ($)Segment$ / sharesshares | Dec. 31, 2016USD ($)$ / sharesshares | Dec. 31, 2015USD ($)$ / sharesshares | Jan. 01, 2018USD ($) | Jan. 01, 2017USD ($) | May 24, 2016USD ($) | |
Summary Of Significant Accounting Policies [Line Items] | |||||||
Long-term marketable securities, minimum original maturity term | 1 year | ||||||
Investment fund | $ 0 | ||||||
Long-term marketable securities | $ 0 | ||||||
Gain (loss) on investments | 0 | 0 | $ 0 | ||||
Fair value of other assets | 0 | ||||||
Fair value of other liabilities | 0 | ||||||
Accrued liability contingent consideration | 6,119,000 | ||||||
Reserves for excess and obsolete inventory | $ 455,000 | $ 435,000 | |||||
Stock options, outstanding | shares | 734,940 | 882,748 | |||||
Stock options, weighted average exercise price | $ / shares | $ 20.80 | $ 16.88 | |||||
Common stock excluded from calculation of diluted earnings per share | shares | 317,923 | 381,686 | 196,209 | ||||
Number of operating segment | Segment | 1 | ||||||
Number of reporting segment | Segment | 2 | ||||||
Goodwill impairment | $ 0 | $ 0 | $ 0 | ||||
Amortization expense | 6,215,000 | 2,052,000 | $ 1,600,000 | ||||
Restricted Cash | 450,000 | ||||||
ASU No. 2016-09 | U. S. Federal and State Jurisdiction | |||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||
Net operating loss carry forwards | $ 5,100,000 | ||||||
Increase in valuation allowance | 5,100,000 | ||||||
Impact of adopting ASU 2016-09 on retained earnings | $ 0 | ||||||
2.125% Convertible Senior Notes due 2021 | |||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||
Principal amount | $ 11,000 | $ 115,000,000 | |||||
Notes, due date | Jun. 1, 2021 | ||||||
Notes, frequency of periodic payment | Semi-annually | ||||||
Notes, date of first required payment | Dec. 1, 2016 | ||||||
Total convertible senior notes | $ 99,250,000 | $ 95,272,000 | |||||
Fair value of convertible senior notes | $ 149,500,000 | ||||||
Minimum | |||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||
Short-term marketable securities, minimum original maturity term | 90 days | ||||||
Restricted Stock Units (RSUs) | |||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||
Restricted stock units, outstanding | shares | 505,235 | 353,838 | |||||
Restricted Stock Units (RSUs) | Awards Granted to Non-Executive Level Employees | |||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||
Estimated forfeiture rates | 8.00% | ||||||
Restricted Stock Units (RSUs) | Awards Granted to Executive Level Employees | |||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||
Estimated forfeiture rates | 3.00% | ||||||
Option To Purchase Common Stock | |||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||
Stock options, outstanding | shares | 734,940 | 1,236,586 | 1,240,935 | ||||
Stock options, weighted average exercise price | $ / shares | $ 20.80 | $ 12.05 | $ 10.44 | ||||
Employee Stock Option | Awards Granted to Non-Executive Level Employees | |||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||
Estimated forfeiture rates | 8.00% | ||||||
Employee Stock Option | Awards Granted to Executive Level Employees | |||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||
Estimated forfeiture rates | 3.00% | ||||||
Non-Employee Directors | |||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||
Estimated forfeiture rates | 0.00% | ||||||
BioMarin Pharmaceutical, Inc. | Asset Purchase Agreement | |||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||
Potential milestone payments to be received | $ 160,000,000 | ||||||
Provision for refund | $ 0 | ||||||
BioMarin Pharmaceutical, Inc. | Clinical Development | Asset Purchase Agreement | |||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||
Percentage relate to clinical development from Milestone payment | 37.00% | ||||||
BioMarin Pharmaceutical, Inc. | Initial Commercial Sales | Asset Purchase Agreement | |||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||
Percentage relate to clinical development from Milestone payment | 63.00% | ||||||
Subsequent Event | ASU No. 2016-18 | |||||||
Summary Of Significant Accounting Policies [Line Items] | |||||||
Restricted Cash | $ 450,000 |
Investments in Marketable Secur
Investments in Marketable Securities (Detail) - Marketable securities $ in Thousands | Dec. 31, 2016USD ($) |
Schedule of Available-for-sale Securities [Line Items] | |
Amortized Cost | $ 19,552 |
Gross Unrealized Gain | 2 |
Gross Unrealized Loss | (7) |
Fair Value | 19,547 |
U.S. Government and agency securities | |
Schedule of Available-for-sale Securities [Line Items] | |
Amortized Cost | 807 |
Fair Value | 807 |
Corporate and other debt securities | |
Schedule of Available-for-sale Securities [Line Items] | |
Amortized Cost | 18,745 |
Gross Unrealized Gain | 2 |
Gross Unrealized Loss | (7) |
Fair Value | $ 18,740 |
Rollforward of Fair Value of Co
Rollforward of Fair Value of Contingent Consideration (Detail) $ in Thousands | 12 Months Ended |
Dec. 31, 2017USD ($) | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Balance at December 31, 2016 | $ 6,119 |
Payments | (6,119) |
Balance at September 30, 2017 | $ 0 |
Schedule of Inventories (Detail
Schedule of Inventories (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Inventory [Line Items] | ||
Raw materials | $ 22,351 | $ 14,954 |
Work-in-process | 4,083 | 2,789 |
Finished products | 12,570 | 6,953 |
Total | $ 39,004 | $ 24,696 |
Estimated Useful Life of Assets
Estimated Useful Life of Assets (Detail) | 12 Months Ended |
Dec. 31, 2017 | |
Building | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Life | 30 years |
Leasehold improvements | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Life | Shorter of the term of the lease or estimated useful life |
Equipment | Minimum | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Life | 3 years |
Equipment | Maximum | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Life | 12 years |
Furniture and fixtures | Minimum | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Life | 3 years |
Furniture and fixtures | Maximum | |
Property, Plant and Equipment [Line Items] | |
Estimated Useful Life | 8 years |
Reconciliation of Basic and Dil
Reconciliation of Basic and Diluted Shares Amounts (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Numerator: | |||||||||||
Net income | $ 12,178 | $ 4,669 | $ 8,438 | $ 3,068 | $ 5,029 | $ 1,155 | $ 3,872 | $ 1,625 | $ 28,353 | $ 11,681 | $ 9,345 |
Denominator: | |||||||||||
Basic weighted average common shares outstanding | 43,569,000 | 41,237,000 | 34,098,000 | 33,892,000 | 33,833,000 | 33,779,000 | 33,649,000 | 33,025,000 | 38,233,527 | 33,572,883 | 32,881,940 |
Effect of dilutive securities: | |||||||||||
Stock options and restricted stock awards | 441,924 | 526,015 | 695,151 | ||||||||
Convertible senior notes | 474,923 | ||||||||||
Diluted weighted average common shares outstanding | 44,385,000 | 42,563,000 | 35,095,000 | 34,382,000 | 34,369,000 | 34,313,000 | 34,175,000 | 33,494,000 | 39,150,374 | 34,098,898 | 33,577,091 |
Basic net income per common share | $ 0.28 | $ 0.11 | $ 0.25 | $ 0.09 | $ 0.15 | $ 0.03 | $ 0.12 | $ 0.05 | $ 0.74 | $ 0.35 | $ 0.28 |
Diluted net income per common share | $ 0.27 | $ 0.11 | $ 0.24 | $ 0.09 | $ 0.15 | $ 0.03 | $ 0.11 | $ 0.05 | $ 0.72 | $ 0.34 | $ 0.28 |
Summary of Product Revenues by
Summary of Product Revenues by Product Line (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |||
Revenue from External Customer [Line Items] | |||||||||||||
Product revenue | $ 41,572 | $ 36,514 | $ 32,434 | $ 30,569 | $ 25,500 | $ 24,677 | $ 29,170 | $ 25,094 | $ 141,089 | $ 104,441 | $ 83,537 | ||
Protein products | |||||||||||||
Revenue from External Customer [Line Items] | |||||||||||||
Product revenue | 53,969 | 54,716 | 52,938 | ||||||||||
Filtration products | |||||||||||||
Revenue from External Customer [Line Items] | |||||||||||||
Product revenue | 49,050 | [1] | 19,774 | [2] | 15,676 | ||||||||
Chromatography products | |||||||||||||
Revenue from External Customer [Line Items] | |||||||||||||
Product revenue | 36,309 | [1] | 29,520 | [3] | 14,613 | ||||||||
Other | |||||||||||||
Revenue from External Customer [Line Items] | |||||||||||||
Product revenue | $ 1,761 | [1] | $ 431 | $ 310 | |||||||||
[1] | 2017 revenue for filtration, chromatography and other products includes revenue related to Spectrum from August 1, 2017 through December 31, 2017. | ||||||||||||
[2] | 2016 revenue for filtration products includes revenue related to TangenX from December 14, 2016 through December 31, 2016. | ||||||||||||
[3] | 2016 revenue for chromatography products includes revenue related to Atoll from April 1, 2016 through December 31, 2016. |
Percentage of Revenue by Geogra
Percentage of Revenue by Geographic Area (Detail) - Geographic Concentration Risk - Total Revenue | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Concentration Risk [Line Items] | |||
Revenues, percentage by country | 100.00% | 100.00% | 100.00% |
United States | |||
Concentration Risk [Line Items] | |||
Revenues, percentage by country | 43.00% | 39.00% | 28.00% |
Sweden | |||
Concentration Risk [Line Items] | |||
Revenues, percentage by country | 20.00% | 29.00% | 37.00% |
United Kingdom | |||
Concentration Risk [Line Items] | |||
Revenues, percentage by country | 4.00% | 7.00% | 17.00% |
Other | |||
Concentration Risk [Line Items] | |||
Revenues, percentage by country | 33.00% | 25.00% | 18.00% |
Total Assets by Geographic Area
Total Assets by Geographic Area (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Asset | $ 743,519 | $ 288,913 |
United States | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Asset | 654,673 | 209,728 |
Europe | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Asset | 85,169 | 79,145 |
Asia | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Asset | $ 3,677 | $ 40 |
Long Lived Assets by Geographic
Long Lived Assets by Geographic Area (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Long Lived Assets | $ 500,737 | $ 104,760 |
United States | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Long Lived Assets | 465,453 | 77,039 |
Europe | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Long Lived Assets | 34,430 | $ 27,721 |
Asia | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Long Lived Assets | $ 854 |
Percentage of Revenue from Sign
Percentage of Revenue from Significant Customers (Detail) - Customer Concentration Risk - Sales Revenue | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
GE Healthcare | |||
Revenue, Major Customer [Line Items] | |||
Revenue from significant customers as a percentage of total revenue | 21.00% | 29.00% | 37.00% |
MilliporeSigma | |||
Revenue, Major Customer [Line Items] | |||
Revenue from significant customers as a percentage of total revenue | 18.00% | 28.00% | 29.00% |
Percentage of Accounts Receivab
Percentage of Accounts Receivable by Significant Customers (Detail) - Customer Concentration Risk - Accounts Receivable | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
GE Healthcare | ||
Concentration Risk [Line Items] | ||
Accounts receivable, percentage by customer | 11.00% | 26.00% |
MilliporeSigma | ||
Concentration Risk [Line Items] | ||
Accounts receivable, percentage by customer | 19.00% | 8.00% |
Intangible Assets (Detail)
Intangible Assets (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 158,084 | $ 36,501 |
Accumulated Amortization | $ (13,331) | $ (6,695) |
Weighted Average Useful Life (in years) | 16 years | 13 years |
Trademark | ||
Intangible Assets [Line Items] | ||
Gross Carrying Amount, indefinite lived intangible assets | $ 700 | $ 711 |
Technology - developed | ||
Intangible Assets [Line Items] | ||
Gross Carrying Amount | 51,801 | 12,911 |
Accumulated Amortization | $ (3,201) | $ (1,468) |
Weighted Average Useful Life (in years) | 19 years | 17 years |
Patents | ||
Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 240 | $ 240 |
Accumulated Amortization | $ (238) | $ (208) |
Weighted Average Useful Life (in years) | 8 years | 8 years |
Customer relationships | ||
Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 102,120 | $ 22,555 |
Accumulated Amortization | $ (9,636) | $ (4,995) |
Weighted Average Useful Life (in years) | 14 years | 11 years |
Other intangibles | ||
Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 1,063 | $ 84 |
Accumulated Amortization | $ (209) | $ (24) |
Weighted Average Useful Life (in years) | 3 years | 2 years |
Trademark | ||
Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 2,160 | |
Accumulated Amortization | $ (47) | |
Weighted Average Useful Life (in years) | 20 years |
Amortization Expense for Amorti
Amortization Expense for Amortized Intangible Assets (Detail) $ in Thousands | Dec. 31, 2017USD ($) |
Finite-Lived Intangible Assets [Line Items] | |
Amortization Expense, December 31, 2018 | $ 10,633 |
Amortization Expense, December 31, 2019 | 10,578 |
Amortization Expense, December 31, 2020 | 9,894 |
Amortization Expense, December 31, 2021 | 9,376 |
Amortization Expense, December 31, 2022 | $ 9,374 |
Acquisitions, Goodwill and Ot49
Acquisitions, Goodwill and Other Intangible Assets - Additional Information (Detail) - USD ($) | Aug. 01, 2017 | Dec. 14, 2016 | Apr. 01, 2016 | Dec. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2017 | Dec. 31, 2016 |
Business Acquisition [Line Items] | |||||||
Cash consideration | $ 112,795,000 | $ 44,614,000 | |||||
Value of common stock issued | 247,575,000 | 14,135,000 | |||||
Working capital adjustment | 425,000 | ||||||
Fair value of acquired finite lived intangible assets | $ 19,829,000 | $ 120,080,000 | $ 120,080,000 | $ 19,829,000 | |||
Finite lived intangible asset, useful life | 16 years | 13 years | |||||
Goodwill | $ 59,548,000 | $ 327,333,000 | $ 327,333,000 | $ 59,548,000 | |||
Common stock, par value | $ 0.01 | $ 0.01 | $ 0.01 | $ 0.01 | |||
Estimated fair value of contingent consideration | $ 952,000 | $ 952,000 | |||||
Customer relationships | |||||||
Business Acquisition [Line Items] | |||||||
Finite lived intangible asset, useful life | 14 years | 11 years | |||||
Technology - developed | |||||||
Business Acquisition [Line Items] | |||||||
Finite lived intangible asset, useful life | 19 years | 17 years | |||||
Atoll GmbH | |||||||
Business Acquisition [Line Items] | |||||||
Shares issued for business acquisition | 538,700 | ||||||
Value of common stock issued | $ 14,138,000 | ||||||
Working capital adjustment | 74,000 | ||||||
Business combination, consideration transferred | 25,266,000 | ||||||
Fair value of net assets acquired | 25,266,000 | ||||||
Goodwill | 17,077,000 | ||||||
Business acquisition, transaction costs | $ 1,307,000 | ||||||
Common stock, par value | $ 0.01 | ||||||
Earnout consideration | $ 1,100,000 | ||||||
Estimated fair value of contingent consideration | 952,000 | ||||||
Atoll GmbH | Up Front Payment | |||||||
Business Acquisition [Line Items] | |||||||
Cash consideration | 10,200,000 | ||||||
Atoll GmbH | Customer relationships | |||||||
Business Acquisition [Line Items] | |||||||
Fair value of acquired finite lived intangible assets | $ 5,318,000 | ||||||
Finite lived intangible asset, useful life | 13 years | ||||||
Atoll GmbH | Technology - developed | |||||||
Business Acquisition [Line Items] | |||||||
Fair value of acquired finite lived intangible assets | $ 2,175,000 | ||||||
Finite lived intangible asset, useful life | 14 years | ||||||
Atoll GmbH | Non-competition agreements | |||||||
Business Acquisition [Line Items] | |||||||
Fair value of acquired finite lived intangible assets | $ 57,000 | ||||||
Finite lived intangible asset, useful life | 2 years | ||||||
Atoll GmbH | Trademark | |||||||
Business Acquisition [Line Items] | |||||||
Fair value of acquired finite lived intangible assets | $ 11,000 | ||||||
Finite lived intangible asset, useful life | 2 years | ||||||
TangenX Technology Corporation | |||||||
Business Acquisition [Line Items] | |||||||
Cash consideration | $ 37,532,000 | ||||||
Working capital adjustment | (382,000) | ||||||
Business combination, consideration transferred | 37,150,000 | ||||||
Fair value of net assets acquired | 37,150,000 | ||||||
Goodwill | 29,501,000 | ||||||
Business acquisition, revenue | $ 119,000 | ||||||
Business acquisition, transaction costs | $ 431,000 | $ 935,000 | |||||
TangenX Technology Corporation | Customer relationships | |||||||
Business Acquisition [Line Items] | |||||||
Fair value of acquired finite lived intangible assets | $ 6,192,000 | ||||||
Finite lived intangible asset, useful life | 13 years | ||||||
TangenX Technology Corporation | Technology - developed | |||||||
Business Acquisition [Line Items] | |||||||
Fair value of acquired finite lived intangible assets | $ 6,044,000 | ||||||
Finite lived intangible asset, useful life | 20 years | ||||||
TangenX Technology Corporation | Non-competition agreements | |||||||
Business Acquisition [Line Items] | |||||||
Fair value of acquired finite lived intangible assets | $ 21,000 | ||||||
Finite lived intangible asset, useful life | 5 years | ||||||
TangenX Technology Corporation | Trademark | |||||||
Business Acquisition [Line Items] | |||||||
Fair value of acquired finite lived intangible assets | $ 11,000 | ||||||
Finite lived intangible asset, useful life | 2 years | ||||||
Spectrum Inc. | |||||||
Business Acquisition [Line Items] | |||||||
Cash consideration | $ 122,932,000 | ||||||
Shares issued for business acquisition | 6,153,995 | ||||||
Value of common stock issued | $ 247,575,000 | ||||||
Working capital adjustment | 425,000 | ||||||
Business combination, consideration transferred | 370,932,000 | ||||||
Fair value of net assets acquired | 370,932,000 | ||||||
Goodwill | 265,519,000 | ||||||
Goodwill expected to be deductible for tax purposes amount | 0 | ||||||
Business acquisition, revenue | $ 19,394,000 | ||||||
Spectrum Inc. | Selling, general and administrative | |||||||
Business Acquisition [Line Items] | |||||||
Business Combination, Acquisition Related Costs | $ 7,060,000 | ||||||
Spectrum Inc. | Customer relationships | |||||||
Business Acquisition [Line Items] | |||||||
Fair value of acquired finite lived intangible assets | $ 78,400,000 | ||||||
Finite lived intangible asset, useful life | 15 years | ||||||
Spectrum Inc. | Technology - developed | |||||||
Business Acquisition [Line Items] | |||||||
Fair value of acquired finite lived intangible assets | $ 38,560,000 | ||||||
Finite lived intangible asset, useful life | 20 years | ||||||
Spectrum Inc. | Non-competition agreements | |||||||
Business Acquisition [Line Items] | |||||||
Fair value of acquired finite lived intangible assets | $ 960,000 | ||||||
Finite lived intangible asset, useful life | 3 years | ||||||
Spectrum Inc. | Trademark | |||||||
Business Acquisition [Line Items] | |||||||
Fair value of acquired finite lived intangible assets | $ 2,160,000 | ||||||
Minimum | Spectrum Inc. | Trademark | |||||||
Business Acquisition [Line Items] | |||||||
Finite lived intangible asset, useful life | 2 years | ||||||
Maximum | Spectrum Inc. | Trademark | |||||||
Business Acquisition [Line Items] | |||||||
Finite lived intangible asset, useful life | 20 years |
Consideration Transferred (Deta
Consideration Transferred (Detail) - USD ($) $ in Thousands | Aug. 01, 2017 | Dec. 14, 2016 | Apr. 01, 2016 | Dec. 31, 2017 | Dec. 31, 2016 |
Business Acquisition [Line Items] | |||||
Cash consideration | $ 112,795 | $ 44,614 | |||
Equity consideration | 247,575 | 14,135 | |||
Working capital adjustment | $ 425 | ||||
Estimated fair value of contingent consideration | $ 952 | ||||
Spectrum Inc. | |||||
Business Acquisition [Line Items] | |||||
Cash consideration | $ 122,932 | ||||
Equity consideration | 247,575 | ||||
Working capital adjustment | 425 | ||||
Total consideration transferred | $ 370,932 | ||||
Atoll GmbH | |||||
Business Acquisition [Line Items] | |||||
Cash consideration, less $74 of working capital adjustments | $ 10,176 | ||||
Equity consideration | 14,138 | ||||
Working capital adjustment | 74 | ||||
Estimated fair value of contingent consideration | 952 | ||||
Total consideration transferred | $ 25,266 | ||||
TangenX Technology Corporation | |||||
Business Acquisition [Line Items] | |||||
Cash consideration | $ 37,532 | ||||
Working capital adjustment | (382) | ||||
Total consideration transferred | $ 37,150 |
Components and Allocation of Pu
Components and Allocation of Purchase Price (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Aug. 01, 2017 | Dec. 31, 2016 | Dec. 14, 2016 | Apr. 01, 2016 |
Business Acquisition [Line Items] | |||||
Accounts receivable | $ 5,075 | $ 1,267 | |||
Other current assets | 1,718 | 183 | |||
Accounts payable and other liabilities assumed | (7,698) | (3,662) | |||
Business combination, intangible assets | 120,080 | 19,829 | |||
Deferred tax liabilities | (43,608) | (5,841) | |||
Goodwill | $ 327,333 | $ 59,548 | |||
Spectrum Inc. | |||||
Business Acquisition [Line Items] | |||||
Cash and cash equivalents | $ 10,137 | ||||
Accounts receivable | 5,075 | ||||
Inventory | 13,705 | ||||
Prepaid expenses and other assets | 616 | ||||
Fixed assets | 6,004 | ||||
Deferred tax assets | 1,102 | ||||
Deferred tax liabilities | (43,608) | ||||
Goodwill | 265,519 | ||||
Net assets acquired | 370,932 | ||||
Accounts payable | (1,335) | ||||
Unrecognized tax benefit | (576) | ||||
Accrued liabilities | (5,787) | ||||
Spectrum Inc. | Customer relationships | |||||
Business Acquisition [Line Items] | |||||
Business combination, intangible assets | 78,400 | ||||
Spectrum Inc. | Technology - developed | |||||
Business Acquisition [Line Items] | |||||
Business combination, intangible assets | 38,560 | ||||
Spectrum Inc. | Trademark | |||||
Business Acquisition [Line Items] | |||||
Business combination, intangible assets | 2,160 | ||||
Spectrum Inc. | Non-competition agreements | |||||
Business Acquisition [Line Items] | |||||
Business combination, intangible assets | $ 960 | ||||
Atoll GmbH | |||||
Business Acquisition [Line Items] | |||||
Cash and cash equivalents | $ 1,409 | ||||
Accounts receivable | 697 | ||||
Inventory | 155 | ||||
Other current assets | 169 | ||||
Fixed assets | 114 | ||||
Deferred tax assets | 885 | ||||
Accounts payable and other liabilities assumed | (599) | ||||
Deferred tax liabilities | (2,202) | ||||
Goodwill | 17,077 | ||||
Net assets acquired | 25,266 | ||||
Atoll GmbH | Customer relationships | |||||
Business Acquisition [Line Items] | |||||
Business combination, intangible assets | 5,318 | ||||
Atoll GmbH | Technology - developed | |||||
Business Acquisition [Line Items] | |||||
Business combination, intangible assets | 2,175 | ||||
Atoll GmbH | Trademark | |||||
Business Acquisition [Line Items] | |||||
Business combination, intangible assets | 11 | ||||
Atoll GmbH | Non-competition agreements | |||||
Business Acquisition [Line Items] | |||||
Business combination, intangible assets | $ 57 | ||||
TangenX Technology Corporation | |||||
Business Acquisition [Line Items] | |||||
Cash and cash equivalents | $ 1,218 | ||||
Accounts receivable | 459 | ||||
Other receivables | 111 | ||||
Inventory | 936 | ||||
Other current assets | 50 | ||||
Fixed assets | 215 | ||||
Accounts payable and other liabilities assumed | (3,083) | ||||
Deferred tax liabilities | (4,525) | ||||
Goodwill | 29,501 | ||||
Net assets acquired | 37,150 | ||||
TangenX Technology Corporation | Customer relationships | |||||
Business Acquisition [Line Items] | |||||
Business combination, intangible assets | 6,192 | ||||
TangenX Technology Corporation | Technology - developed | |||||
Business Acquisition [Line Items] | |||||
Business combination, intangible assets | 6,044 | ||||
TangenX Technology Corporation | Trademark | |||||
Business Acquisition [Line Items] | |||||
Business combination, intangible assets | 11 | ||||
TangenX Technology Corporation | Non-competition agreements | |||||
Business Acquisition [Line Items] | |||||
Business combination, intangible assets | $ 21 |
Unaudited Supplemental Pro Form
Unaudited Supplemental Pro Forma Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Spectrum Inc and TangenX Technology Corporation | |||
Business Acquisition [Line Items] | |||
Total revenue | $ 162,913 | $ 145,994 | |
Net income | $ 17,220 | $ (12,656) | |
Basic | $ 0.41 | $ (0.32) | |
Diluted | $ 0.40 | $ (0.32) | |
TangenX Technology Corporation | |||
Business Acquisition [Line Items] | |||
Total revenue | $ 110,228 | $ 88,437 | |
Net income | $ 5,744 | $ 13,208 | |
Basic | $ 0.17 | $ 0.40 | |
Diluted | $ 0.17 | $ 0.39 |
Consideration Transferred (Pare
Consideration Transferred (Parenthetical) (Detail) - USD ($) $ in Thousands | Apr. 01, 2016 | Dec. 31, 2017 |
Business Acquisition [Line Items] | ||
Working capital adjustment | $ 425 | |
Atoll GmbH | ||
Business Acquisition [Line Items] | ||
Working capital adjustment | $ 74 |
Changes in Carrying Value of Go
Changes in Carrying Value of Goodwill (Detail) $ in Thousands | 12 Months Ended |
Dec. 31, 2017USD ($) | |
Goodwill [Line Items] | |
Balance at December 31, 2016 | $ 59,548 |
Balance at December 31, 2017 | 327,333 |
TangenX Technology Corporation | |
Goodwill [Line Items] | |
Goodwill arising from Acquisition | 85 |
Spectrum Inc. | |
Goodwill [Line Items] | |
Goodwill arising from Acquisition | 265,519 |
Atoll GmbH | |
Goodwill [Line Items] | |
Foreign currency adjustments on goodwill from the Atoll Acquisition | $ 2,181 |
Income from Operations Before I
Income from Operations Before Income Taxes (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Schedule of Income Before Income Tax [Line Items] | |||||||||||
Domestic | $ (6,709) | $ (4,882) | $ (2,490) | ||||||||
Foreign | 13,957 | 16,574 | 15,913 | ||||||||
Income before income taxes | $ 1,549 | $ (2,022) | $ 3,654 | $ 4,067 | $ 1,566 | $ 2,214 | $ 5,372 | $ 2,540 | $ 7,248 | $ 11,692 | $ 13,423 |
Current and Deferred Income Tax
Current and Deferred Income Taxes (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Taxes [Line Items] | |||||||||||
Current | $ 3,624 | $ 4,077 | $ 3,745 | ||||||||
Deferred | (24,729) | (4,066) | 333 | ||||||||
Total | $ (10,629) | $ (6,691) | $ (4,784) | $ 999 | $ (3,463) | $ 1,059 | $ 1,500 | $ 915 | $ (21,105) | $ 11 | $ 4,078 |
Provision for Income Taxes by J
Provision for Income Taxes by Jurisdiction (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Taxes [Line Items] | |||||||||||
Federal | $ (24,012) | $ (3,809) | $ 295 | ||||||||
State | (438) | (207) | 276 | ||||||||
Foreign | 3,345 | 4,027 | 3,507 | ||||||||
Total | $ (10,629) | $ (6,691) | $ (4,784) | $ 999 | $ (3,463) | $ 1,059 | $ 1,500 | $ 915 | $ (21,105) | $ 11 | $ 4,078 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) € in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||
Jun. 30, 2017USD ($) | Dec. 31, 2018 | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2017EUR (€) | |
Income Taxes [Line Items] | ||||||
Valuation allowance increase (decrease) | $ (9,200) | $ (9,973) | $ (8,535) | $ 1,216 | ||
Impact of unrecognized tax benefits on effective tax rate | 1,806 | |||||
Earnings of foreign subsidiaries permanently reinvest outside the U.S | $ 53,747 | |||||
Corporate tax rate | 35.00% | 34.00% | 34.00% | |||
Income Tax Expense (Benefit), Continuing Operations, Adjustment of Deferred Tax (Asset) Liability | $ 12,812 | |||||
Tax cuts and jobs Act, increased tax provision on undistributed and previously untaxed post-1986 earnings and profits of the specified foreign corporation | $ 3,266 | |||||
Latest Tax Year | ||||||
Income Taxes [Line Items] | ||||||
Net operating loss and business tax credit carry forwards expiration date | At various dates through December 2037 | |||||
Scenario, Forecast | ||||||
Income Taxes [Line Items] | ||||||
Corporate tax rate | 21.00% | |||||
TangenX Technology Corporation | ||||||
Income Taxes [Line Items] | ||||||
Valuation allowance increase (decrease) | $ (5,872) | |||||
Domestic Tax Authority | ||||||
Income Taxes [Line Items] | ||||||
Business tax credits carry forwards | $ 297 | |||||
State | ||||||
Income Taxes [Line Items] | ||||||
Business tax credits carry forwards | 99 | |||||
Federal and State | ||||||
Income Taxes [Line Items] | ||||||
Increase in net operating loss carryovers | 5,100 | |||||
United States | ||||||
Income Taxes [Line Items] | ||||||
Net operating loss carry forwards | 19,652 | |||||
Germany | ||||||
Income Taxes [Line Items] | ||||||
Net operating loss carry forwards | $ 722 | € 603 |
Consolidated Deferred Tax Asset
Consolidated Deferred Tax Assets (Liabilities) (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Temporary timing differences: | ||
Stock compensation | $ 1,662 | $ 1,722 |
Contingent consideration | 2,196 | 3,333 |
Other | 1,704 | 1,895 |
Total temporary timing differences | 5,562 | 6,950 |
Net operating loss carryforwards | 4,361 | 12,284 |
Tax business credits carryforwards | 1,265 | 2,036 |
Total deferred tax assets | 11,188 | 21,270 |
Valuation allowance | (6) | (9,979) |
Net deferred tax assets | 11,182 | 11,291 |
Deferred tax liabilities: | ||
Goodwill and intangible assets | (33,166) | (7,346) |
Conversion option on convertible notes | (3,183) | (6,048) |
Total deferred tax liabilities | (36,349) | (13,394) |
Net deferred tax liabilities | $ (25,167) | $ (2,103) |
Reconciliation of Federal Statu
Reconciliation of Federal Statutory Rate to Effective Income Tax Rate (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Rate Reconciliation [Line Items] | |||||||||||
Income before income taxes | $ 1,549 | $ (2,022) | $ 3,654 | $ 4,067 | $ 1,566 | $ 2,214 | $ 5,372 | $ 2,540 | $ 7,248 | $ 11,692 | $ 13,423 |
Expected tax at statutory rate | 2,537 | 3,975 | 4,564 | ||||||||
Adjustments due to: | |||||||||||
Difference between U.S. and foreign tax | (1,797) | (2,031) | (1,910) | ||||||||
State income and franchise taxes | (307) | (326) | 563 | ||||||||
Business tax credits | (7,708) | (236) | (115) | ||||||||
Stock compensation | (946) | 31 | 348 | ||||||||
Transaction costs | 1,232 | 156 | |||||||||
Other | 470 | 380 | (230) | ||||||||
Change in U.S. federal tax rates | (12,839) | ||||||||||
Transition tax | 3,266 | ||||||||||
Change in valuation allowance | (12,164) | (1,981) | 1,216 | ||||||||
Other | (151) | 43 | (358) | ||||||||
Provision for income taxes | $ (10,629) | $ (6,691) | $ (4,784) | $ 999 | $ (3,463) | $ 1,059 | $ 1,500 | $ 915 | $ (21,105) | $ 11 | $ 4,078 |
Expected tax at statutory rate | 35.00% | 34.00% | 34.00% | ||||||||
Adjustments due to: | |||||||||||
Difference between U.S. and foreign tax | (24.80%) | (17.40%) | (14.20%) | ||||||||
State income and franchise taxes | (4.20%) | (2.80%) | 4.20% | ||||||||
Business tax credits | (9.80%) | (2.00%) | (0.90%) | ||||||||
Stock compensation | (13.10%) | 0.30% | 2.60% | ||||||||
Transaction costs | 17.00% | 1.30% | |||||||||
Other | 6.40% | 3.20% | (1.70%) | ||||||||
Change in U.S. federal tax rates | (177.20%) | ||||||||||
Transition tax | 45.10% | ||||||||||
Change in valuation allowance | (167.80%) | (16.90%) | 9.10% | ||||||||
Other | (2.10%) | 0.40% | (2.70%) | ||||||||
Provision for income taxes | (291.20%) | 0.10% | 30.40% |
Summary of Tax Returns Periods
Summary of Tax Returns Periods Subject to Examination by Federal, State and International Taxing Authorities (Detail) | 12 Months Ended |
Dec. 31, 2017 | |
United States | Earliest Tax Year | |
Income Tax Examination [Line Items] | |
Fiscal year subject to examination | 2,014 |
United States | Latest Tax Year | |
Income Tax Examination [Line Items] | |
Fiscal year subject to examination | 2,017 |
Sweden | Earliest Tax Year | |
Income Tax Examination [Line Items] | |
Fiscal year subject to examination | 2,011 |
Sweden | Latest Tax Year | |
Income Tax Examination [Line Items] | |
Fiscal year subject to examination | 2,017 |
Germany | Earliest Tax Year | |
Income Tax Examination [Line Items] | |
Fiscal year subject to examination | 2,016 |
Germany | Latest Tax Year | |
Income Tax Examination [Line Items] | |
Fiscal year subject to examination | 2,017 |
Netherlands | Earliest Tax Year | |
Income Tax Examination [Line Items] | |
Fiscal year subject to examination | 2,012 |
Netherlands | Latest Tax Year | |
Income Tax Examination [Line Items] | |
Fiscal year subject to examination | 2,017 |
Reconciliation of Unrecognized
Reconciliation of Unrecognized Tax Benefits (Detail) $ in Thousands | 12 Months Ended |
Dec. 31, 2017USD ($) | |
Significant Change in Unrecognized Tax Benefits is Reasonably Possible [Line Items] | |
Unrecognized tax benefits at January 1, 2017 | $ 1,407 |
Gross increases - tax positions in prior period | 679 |
Gross increases - tax positions in current period | 199 |
Gross decreases - release | (479) |
Unrecognized tax benefits at December 31, 2017 | $ 1,806 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | Jul. 03, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2012 |
Stockholders Equity Note Disclosure [Line Items] | |||||
Common stock, shares issued | 2,807,017 | 43,587,079 | 33,844,074 | ||
Common stock issue price per share | $ 42.75 | ||||
Exercised number of shares | 215,495 | ||||
Net proceeds from public offering | $ 129,309 | $ 129,309 | |||
Stock-based compensation expense | $ 6,747 | $ 4,595 | $ 3,598 | ||
Stock options, outstanding | 734,940 | 882,748 | |||
Number of shares available for future grant | 1,220,915 | ||||
Closing price of common stock | $ 36.28 | ||||
Aggregate intrinsic value of stock options exercised | $ 5,305 | $ 5,043 | $ 3,638 | ||
Weighted average grant date fair value of share-based awards granted | $ 16.94 | $ 14.16 | $ 16.05 | ||
Total fair value of stock options vested | $ 2,220 | $ 1,713 | $ 1,536 | ||
Total unrecognized compensation cost | $ 16,133 | ||||
Unrecognized compensation cost, weighted average remaining requisite service period | 2 years 6 months 7 days | ||||
Number of unvested options and restricted stock units | 772,791 | ||||
Employee Stock Option | Minimum | |||||
Stockholders Equity Note Disclosure [Line Items] | |||||
Incentive options, vesting period | 3 years | ||||
Employee Stock Option | Minimum | Vest Over Three Year | |||||
Stockholders Equity Note Disclosure [Line Items] | |||||
Incentive options, vesting percentage | 20.00% | ||||
Employee Stock Option | Maximum | |||||
Stockholders Equity Note Disclosure [Line Items] | |||||
Incentive options, vesting period | 5 years | ||||
Incentive options, term | 10 years | ||||
Employee Stock Option | Maximum | Vest Over Five Year | |||||
Stockholders Equity Note Disclosure [Line Items] | |||||
Incentive options, vesting percentage | 33.00% | ||||
Non-Employee Directors | |||||
Stockholders Equity Note Disclosure [Line Items] | |||||
Incentive options, vesting period | 1 year | ||||
Option To Purchase Common Stock | |||||
Stockholders Equity Note Disclosure [Line Items] | |||||
Stock options, outstanding | 734,940 | 1,236,586 | 1,240,935 | ||
Restricted Stock Units (RSUs) | |||||
Stockholders Equity Note Disclosure [Line Items] | |||||
Incentive options, vesting period | 5 years | ||||
Restricted stock units, outstanding | 505,235 | 353,838 | |||
Closing price of common stock | $ 36.28 | ||||
Aggregate intrinsic value of restricted stock units vested | $ 4,010 | $ 1,671 | $ 1,304 | ||
Weighted average grant date fair value of restricted stock units granted | $ 26.03 | $ 27.25 | $ 29.07 | ||
Total grant date fair value of restricted stock units vested | $ 4,010 | $ 1,474 | $ 781 | ||
Unvested Options | |||||
Stockholders Equity Note Disclosure [Line Items] | |||||
Incentive options, vesting period | 5 years | ||||
Underwriters | Common Stock | |||||
Stockholders Equity Note Disclosure [Line Items] | |||||
Exercised number of shares | 421,052 | ||||
Former president and chief executive officer | Employee Stock Option | |||||
Stockholders Equity Note Disclosure [Line Items] | |||||
Stock-based compensation expense | $ 292 | $ 826 | |||
Former president and chief executive officer | Employee Stock Option | Vested as of April 2016 | |||||
Stockholders Equity Note Disclosure [Line Items] | |||||
Incentive options, vesting percentage | 50.00% | ||||
Former president and chief executive officer | Employee Stock Option | Vested as of January 2015 | |||||
Stockholders Equity Note Disclosure [Line Items] | |||||
Incentive options, vesting percentage | 50.00% |
Stock-Based Compensation Expens
Stock-Based Compensation Expense (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Stock-based compensation expense | $ 6,747 | $ 4,595 | $ 3,598 |
Cost of product revenue | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Stock-based compensation expense | 704 | 341 | 213 |
Research and development | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Stock-based compensation expense | 481 | 537 | 336 |
Selling, general and administrative | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Stock-based compensation expense | $ 5,562 | $ 3,717 | $ 3,049 |
Estimated Weighted Average Assu
Estimated Weighted Average Assumptions (Detail) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term (years) | 6 years 1 month 6 days | ||
Volatility | 51.48% | ||
Volatility, minimum | 50.85% | 50.09% | |
Volatility, maximum | 51.01% | 51.89% | |
Risk-free interest rate, minimum | 1.88% | 1.51% | 1.67% |
Risk-free interest rate, maximum | 1.99% | 2.37% | 2.03% |
Expected dividend yield | 0.00% | 0.00% | 0.00% |
Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term (years) | 6 years 8 months 12 days | 6 years 7 months 6 days | |
Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term (years) | 7 years 1 month 6 days | 7 years 2 months 12 days |
Summary of Option Activity (Det
Summary of Option Activity (Detail) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2017USD ($)$ / sharesshares | ||
Options Outstanding | ||
Options outstanding at December 31, 2016 | shares | 882,748 | |
Granted | shares | 101,844 | |
Exercised | shares | (215,495) | |
Forfeited/cancelled | shares | (34,157) | |
Options outstanding at December 31, 2017 | shares | 734,940 | |
Options exercisable at December 31, 2017 | shares | 420,688 | |
Vested and expected to vest at December 31, 2017 | shares | 727,278 | [1] |
Weighted-Average Exercise Price Per Share | ||
Options outstanding at December 31, 2016 | $ / shares | $ 16.88 | |
Granted | $ / shares | 33.38 | |
Exercised | $ / shares | 10.92 | |
Forfeited/cancelled | $ / shares | 20.23 | |
Options outstanding at December 31, 2017 | $ / shares | 20.80 | |
Options exercisable at December 31, 2017 | $ / shares | 15.86 | |
Vested and expected to vest at December 31, 2017 | $ / shares | $ 20.71 | [1] |
Weighted-Average Remaining Contractual Term (in years) | ||
Options outstanding at December 31, 2017 | 6 years 5 months 16 days | |
Options exercisable at December 31, 2017 | 5 years 3 months 11 days | |
Vested and expected to vest at December 31, 2017 | 6 years 5 months 9 days | [1] |
Aggregate Intrinsic Value | ||
Options outstanding at December 31, 2017 | $ | $ 11,558 | |
Options exercisable at December 31, 2017 | $ | 8,720 | |
Vested and expected to vest at December 31, 2017 | $ | $ 11,472 | [1] |
[1] | Represents the number of vested options as of December 31, 2017 plus the number of unvested options expected to vest as of December 31, 2017 based on the unvested outstanding options at December 31, 2017 adjusted for estimated forfeiture rates of 8% for awards granted to non-executive level employees and 3% for awards granted to executive level employees. |
Summary of Option Activity (Par
Summary of Option Activity (Parenthetical) (Detail) - Employee Stock Option | Dec. 31, 2017 |
Awards Granted to Non-Executive Level Employees | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Estimated forfeiture rates | 8.00% |
Awards Granted to Executive Level Employees | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Estimated forfeiture rates | 3.00% |
Summary of Restricted Stock Uni
Summary of Restricted Stock Unit Activity (Detail) - Restricted Stock Units (RSUs) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017USD ($)shares | ||
Options Outstanding | ||
Restricted stock units outstanding at December 31, 2016 | 353,838 | |
Granted | 293,004 | |
Vested | (114,690) | |
Forfeited/cancelled | (26,917) | |
Restricted stock units outstanding at December 31, 2017 | 505,235 | |
Vested and expected to vest at December 31, 2017 | 466,201 | [1] |
Weighted-Average Remaining Contractual Term (in years) | ||
Restricted stock units outstanding at December 31, 2017 | 2 years 7 months 24 days | |
Vested and expected to vest at December 31, 2017 | 2 years 4 months 24 days | [1] |
Aggregate Intrinsic Value | ||
Restricted stock units outstanding at December 31, 2017 | $ | $ 18,330 | |
Vested and expected to vest at December 31, 2017 | $ | $ 16,914 | [1] |
[1] | Represents the number of vested restricted stock units as of December 31, 2017 plus the number of unvested restricted stock units expected to vest as of December 31, 2017 based on the unvested outstanding restricted stock units at December 31, 2017 adjusted for estimated forfeiture rates of 8% for awards granted to non-executive level employees and 3% for awards granted to executive level employees. |
Summary of Restricted Stock U69
Summary of Restricted Stock Unit Activity (Parenthetical) (Detail) - Restricted Stock Units (RSUs) | Dec. 31, 2017 |
Awards Granted to Non-Executive Level Employees | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Estimated forfeiture rates | 8.00% |
Awards Granted to Executive Level Employees | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Estimated forfeiture rates | 3.00% |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||||||||||||
Mar. 31, 2014USD ($)ft² | Jul. 31, 2011USD ($)ft² | Dec. 31, 2017USD ($) | Sep. 30, 2017USD ($) | Jun. 30, 2017USD ($) | Mar. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Sep. 30, 2016USD ($) | Jun. 30, 2016USD ($) | Mar. 31, 2016USD ($) | Dec. 31, 2017USD ($)ft²Building | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Mar. 31, 2008ft² | Mar. 31, 2007ft² | Mar. 31, 2001ft² | |
Commitments and Contingencies [Line Items] | ||||||||||||||||
Lease agreement, term | 8 years 1 month | 11 years | 2 years | 5 years | 10 years | |||||||||||
Lease agreement, space | ft² | 55,694 | 45,000 | 7,350 | 2,500 | 25,000 | |||||||||||
Lease agreement, expiration date | May 31, 2023 | Dec. 31, 2021 | ||||||||||||||
Lease agreement, letter of credit issued | $ 200 | |||||||||||||||
Lease agreement, commencement date | Aug. 1, 2014 | |||||||||||||||
Future minimum rental commitment, 2018 | $ 3,611 | $ 3,611 | ||||||||||||||
Future minimum rental commitment, 2019 | 3,383 | 3,383 | ||||||||||||||
Future minimum rental commitment, 2020 | 3,077 | 3,077 | ||||||||||||||
Future minimum rental commitment, 2021 | 2,750 | 2,750 | ||||||||||||||
Future minimum rental commitment, 2022 | 1,464 | $ 1,464 | ||||||||||||||
Lease termination description | The Company terminated the lease on the 7,350 square feet of space in the first quarter of 2015. | |||||||||||||||
Lease agreement, number buildings leased | Building | 4 | |||||||||||||||
Operating leases, rent expense | $ 3,367 | $ 2,644 | $ 2,619 | |||||||||||||
Operating leases, deferred rent liabilities | 1,656 | $ 1,792 | 1,656 | 1,792 | 1,899 | |||||||||||
Research and development expenses | 3,069 | $ 2,001 | $ 1,860 | $ 1,742 | $ 2,040 | $ 1,886 | $ 1,890 | $ 1,539 | 8,672 | 7,355 | 5,740 | |||||
Purchase orders, supply agreements and other contractual obligations | 15,512 | 15,512 | ||||||||||||||
Licensing Agreements | ||||||||||||||||
Commitments and Contingencies [Line Items] | ||||||||||||||||
Research and development expenses | 161 | $ 5 | $ 7 | |||||||||||||
Before Amendment | ||||||||||||||||
Commitments and Contingencies [Line Items] | ||||||||||||||||
Lease agreement, space | ft² | 55,694 | |||||||||||||||
Security deposit | $ 200 | |||||||||||||||
After Amendment | ||||||||||||||||
Commitments and Contingencies [Line Items] | ||||||||||||||||
Lease agreement, space | ft² | 75,594 | |||||||||||||||
Security deposit | $ 450 | |||||||||||||||
Future minimum rental commitment, 2018 | 1,371 | 1,371 | ||||||||||||||
Future minimum rental commitment, 2019 | 1,371 | 1,371 | ||||||||||||||
Future minimum rental commitment, 2020 | 1,371 | 1,371 | ||||||||||||||
Future minimum rental commitment, 2021 | 1,371 | 1,371 | ||||||||||||||
Future minimum rental commitment, 2022 | 1,251 | 1,251 | ||||||||||||||
Expansion Space | ||||||||||||||||
Commitments and Contingencies [Line Items] | ||||||||||||||||
Lease agreement, space | ft² | 19,900 | |||||||||||||||
Annual rent expense | $ 361 | |||||||||||||||
Renewal Term | ||||||||||||||||
Commitments and Contingencies [Line Items] | ||||||||||||||||
Future minimum rental commitment, 2018 | 1,087 | 1,087 | ||||||||||||||
Future minimum rental commitment, 2019 | 1,087 | 1,087 | ||||||||||||||
Future minimum rental commitment, 2020 | 1,087 | 1,087 | ||||||||||||||
Future minimum rental commitment, 2021 | $ 1,087 | $ 1,087 |
Obligations Under Non-Cancelabl
Obligations Under Non-Cancelable Operating Leases (Detail) $ in Thousands | Dec. 31, 2017USD ($) |
Operating Leased Assets [Line Items] | |
Operating Leases, December 31, 2018 | $ 3,611 |
Operating Leases, December 31, 2019 | 3,383 |
Operating Leases, December 31, 2020 | 3,077 |
Operating Leases, December 31, 2021 | 2,750 |
Operating Leases, December 31, 2022 | 1,464 |
Thereafter | 786 |
Minimum lease payments | $ 15,071 |
Prepaid Expenses and Other Cu72
Prepaid Expenses and Other Current Assets (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Prepaid Expenses And Other Current Assets [Line Items] | ||
Equipment maintenance and services | $ 1,091 | $ 586 |
Prepaid taxes | 311 | 626 |
Prepaid insurance | 594 | 356 |
Deferred costs | 67 | 5 |
Other | 218 | 71 |
Total | $ 2,281 | $ 1,644 |
Property, Plant and Equipment73
Property, Plant and Equipment (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Property, Plant and Equipment [Line Items] | ||
Land | $ 1,023 | |
Buildings | 764 | |
Leasehold improvements | 15,673 | $ 14,592 |
Equipment | 21,904 | 15,214 |
Furniture and fixtures | 4,272 | 3,218 |
Construction in progress | 2,581 | 1,264 |
Total property, plant and equipment | 46,217 | 34,288 |
Less: accumulated depreciation | (23,800) | (19,332) |
Property, plant and equipment, net | $ 22,417 | $ 14,956 |
Property, Plant and Equipment -
Property, Plant and Equipment - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Property, Plant and Equipment [Line Items] | |||
Depreciation expense of property and equipment | $ 4,237 | $ 3,269 | $ 2,996 |
Schedule of Accrued Liabilities
Schedule of Accrued Liabilities (Detail) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Schedule of Accrued Liabilities [Line Items] | ||
Employee compensation | $ 9,560 | $ 5,586 |
Taxes | 1,668 | 1,692 |
Royalty and license fees | 1,383 | 248 |
Contingent consideration | 6,119 | |
Accrued purchases | 1,191 | 382 |
Professional fees | 947 | 411 |
Unearned revenue | 960 | 408 |
Other accrued expenses | 2,220 | 1,168 |
Total | $ 17,929 | $ 16,014 |
Carrying Value of Convertible S
Carrying Value of Convertible Senior Notes (Detail) - 2.125% Convertible Senior Notes due 2021 - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Debt Instrument [Line Items] | ||
Principal amount | $ 115,000 | $ 115,000 |
Unamortized debt discount | (13,395) | (16,777) |
Unamortized debt issuance costs | (2,355) | (2,951) |
Total convertible senior notes | $ 99,250 | $ 95,272 |
Carrying Value of Convertible77
Carrying Value of Convertible Senior Notes (Parenthetical) (Detail) - 2.125% Convertible Senior Notes due 2021 | 12 Months Ended | |
Dec. 31, 2017 | May 24, 2016 | |
Debt Instrument [Line Items] | ||
Notes, interest rate | 2.125% | 2.125% |
Notes, due date | Jun. 1, 2021 |
Convertible Senior Notes - Addi
Convertible Senior Notes - Additional Information (Detail) | May 24, 2016USD ($)d$ / shares | Dec. 31, 2017USD ($)d | Sep. 30, 2017d | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) |
Debt Instrument [Line Items] | |||||
Proceeds from issuance of convertible senior notes, net of costs | $ 111,070,000 | ||||
Accretion of the debt discount | $ 3,977,000 | 2,274,000 | |||
2.125% Convertible Senior Notes due 2021 | |||||
Debt Instrument [Line Items] | |||||
Notes issued | $ 115,000,000 | $ 11,000 | $ 11,000 | ||
Notes, interest rate | 2.125% | 2.125% | 2.125% | ||
Proceeds from issuance of convertible senior notes, net of costs | $ 111,100,000 | ||||
Notes, frequency of periodic payment | Semi-annually | ||||
Notes, date of first required payment | Dec. 1, 2016 | ||||
Notes, due date | Jun. 1, 2021 | ||||
Notes threshold percentage of stock price trigger | 130.00% | ||||
Notes maximum threshold percentage | 130.00% | ||||
Notes threshold trading days | d | 20 | 20 | |||
Notes threshold consecutive trading days | d | 30 | 30 | |||
Debt instrument, convertible if-converted value in excess of principal | $ 34,500,000 | ||||
Notes conversion ratio per $1,000 principal amount | 31.1813 | ||||
Notes initial conversion price | $ / shares | $ 32.07 | ||||
Debt covenants debt default holder percent to declare all notes due minimum | 25.00% | ||||
Number of days within which entity fails to satisfy obligations considered as event of default | 270 days | ||||
Notes issued, fair value | $ 96,289,000 | ||||
Contractual coupon interest | 2,444,000 | 1,473,000 | |||
Accretion of the debt discount | 3,382,000 | 1,934,000 | |||
Amortization of the debt issuance costs | $ 595,000 | 340,000 | |||
Effective interest rate on the Notes | 6.60% | 6.60% | |||
Notes, carrying value | $ 99,250,000 | $ 99,250,000 | $ 95,272,000 | ||
Fair value of the note | $ 149,500,000 | $ 149,500,000 | |||
2.125% Convertible Senior Notes due 2021 | On any business day on or after June 5, 2019 and prior to the maturity date | |||||
Debt Instrument [Line Items] | |||||
Notes threshold percentage of stock price trigger | 130.00% | ||||
Notes threshold trading days | d | 20 | ||||
Notes threshold consecutive trading days | d | 30 | ||||
Notes redemption price | 100.00% |
Change in Accumulated Other Com
Change in Accumulated Other Comprehensive Income (Loss) (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Balance | $ 168,764 | $ 122,748 |
Balance | 591,548 | 168,764 |
Accumulated Other Comprehensive Income (Loss) | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Balance | (13,749) | (8,566) |
Other comprehensive income (loss) | 7,386 | (5,183) |
Balance | (6,363) | (13,749) |
Unrealized gain (loss) on investments | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Balance | (5) | (11) |
Other comprehensive income (loss) | 5 | 6 |
Balance | (5) | |
Foreign currency translation adjustment | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Balance | (13,744) | (8,555) |
Other comprehensive income (loss) | 7,381 | (5,189) |
Balance | $ (6,363) | $ (13,744) |
Employee Benefit Plans - Additi
Employee Benefit Plans - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Pension Plans, Defined Benefit | Sweden | |||
Deferred Compensation Arrangement with Individual, Postretirement Benefits [Line Items] | |||
Defined contribution plan, company contribution | $ 539 | $ 519 | $ 485 |
Minimum | |||
Deferred Compensation Arrangement with Individual, Postretirement Benefits [Line Items] | |||
Defined contribution plan, eligible age of employees | 21 years | ||
Defined Contribution 401 K Plan | |||
Deferred Compensation Arrangement with Individual, Postretirement Benefits [Line Items] | |||
Defined contribution plan, company contribution | $ 451 | $ 184 | $ 141 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Detail) (Detail) $ in Thousands | 12 Months Ended |
Dec. 31, 2017USD ($) | |
Principal Owner [Member] | |
Related Party Transaction [Line Items] | |
Rent Expense | $ 334 |
Principal Owner [Member] | Minimum | |
Related Party Transaction [Line Items] | |
Non controlling ownership interest minimum | 10.00% |
Director [Member] | |
Related Party Transaction [Line Items] | |
Accrued expenses related to director service | $ 190 |
Consolidated Statements of Op82
Consolidated Statements of Operations Information for Each of Previous Eight Quarters (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Revenue: | |||||||||||
Product revenue | $ 41,572 | $ 36,514 | $ 32,434 | $ 30,569 | $ 25,500 | $ 24,677 | $ 29,170 | $ 25,094 | $ 141,089 | $ 104,441 | $ 83,537 |
Royalty and other revenue | 39 | 66 | 21 | 21 | 100 | 147 | 100 | ||||
Total revenue | 41,611 | 36,580 | 32,455 | 30,590 | 25,600 | 24,677 | 29,170 | 25,094 | 141,236 | 104,541 | 83,537 |
Operating expenses: | |||||||||||
Cost of product revenue | 19,136 | 19,987 | 13,937 | 13,990 | 12,162 | 11,242 | 12,644 | 11,069 | 67,050 | 47,117 | 35,251 |
Research and development | 3,069 | 2,001 | 1,860 | 1,742 | 2,040 | 1,886 | 1,890 | 1,539 | 8,672 | 7,355 | 5,740 |
Selling, general and administrative | 16,144 | 14,998 | 11,185 | 9,182 | 8,568 | 7,127 | 8,140 | 7,018 | 51,509 | 30,853 | 24,699 |
Contingent consideration - fair value adjustments | (75) | 675 | 637 | 2,005 | 3,242 | 4,083 | |||||
Total operating expenses | 38,349 | 36,986 | 26,982 | 24,914 | 22,695 | 20,930 | 23,311 | 21,631 | 127,231 | 88,567 | 69,773 |
Income (loss) from operations | 3,262 | (406) | 5,473 | 5,676 | 2,905 | 3,747 | 5,859 | 3,463 | 14,005 | 15,974 | 13,764 |
Investment income | 63 | 102 | 110 | 96 | 112 | 97 | 76 | 61 | 371 | 346 | 136 |
Interest expense | (1,637) | (1,618) | (1,601) | (1,585) | (1,570) | (1,555) | (638) | (5) | (6,441) | (3,768) | (32) |
Other income (expense) | (139) | (100) | (328) | (120) | 119 | (75) | 75 | (979) | (687) | (860) | (445) |
Income (loss) before income taxes | 1,549 | (2,022) | 3,654 | 4,067 | 1,566 | 2,214 | 5,372 | 2,540 | 7,248 | 11,692 | 13,423 |
Income tax provision (benefit) | (10,629) | (6,691) | (4,784) | 999 | (3,463) | 1,059 | 1,500 | 915 | (21,105) | 11 | 4,078 |
Net income (loss) | $ 12,178 | $ 4,669 | $ 8,438 | $ 3,068 | $ 5,029 | $ 1,155 | $ 3,872 | $ 1,625 | $ 28,353 | $ 11,681 | $ 9,345 |
Earnings per share: | |||||||||||
Basic | $ 0.28 | $ 0.11 | $ 0.25 | $ 0.09 | $ 0.15 | $ 0.03 | $ 0.12 | $ 0.05 | $ 0.74 | $ 0.35 | $ 0.28 |
Diluted | $ 0.27 | $ 0.11 | $ 0.24 | $ 0.09 | $ 0.15 | $ 0.03 | $ 0.11 | $ 0.05 | $ 0.72 | $ 0.34 | $ 0.28 |
Weighted average shares outstanding: | |||||||||||
Basic | 43,569,000 | 41,237,000 | 34,098,000 | 33,892,000 | 33,833,000 | 33,779,000 | 33,649,000 | 33,025,000 | 38,233,527 | 33,572,883 | 32,881,940 |
Diluted | 44,385,000 | 42,563,000 | 35,095,000 | 34,382,000 | 34,369,000 | 34,313,000 | 34,175,000 | 33,494,000 | 39,150,374 | 34,098,898 | 33,577,091 |