View Filing Data

Cover Page - shares	9 Months Ended
Cover Page - shares	Sep. 30, 2019	Oct. 31, 2019
Cover page.
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2019
Document Transition Report	false
Entity File Number	001-38847
Entity Registrant Name	SILK ROAD MEDICAL, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	20-8777622
Entity Address, Address Line One	1213 Innsbruck Dr.
Entity Address, City or Town	Sunnyvale
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	94089
City Area Code	408
Local Phone Number	720-9002
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	true
Entity Shell Company	false
Title of 12(b) Security	Common Stock
Trading Symbol	SILK
Security Exchange Name	NASDAQ
Entity Common Stock, Shares Outstanding (in shares)		30,865,553
Entity Central Index Key	0001397702
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q3
Amendment Flag	false

Condensed Consolidated Balance Sheets (unaudited) - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
Current assets:
Cash and cash equivalents	$ 112,277	$ 24,990
Accounts receivable, net	6,932	4,520
Inventories	9,275	5,744
Prepaid expenses and other current assets	3,503	1,408
Total current assets	131,987	36,662
Property and equipment, net	2,697	2,880
Restricted cash	310	310
Other non-current assets	3,575	1,029
Total assets	138,569	40,881
Current liabilities:
Accounts payable	1,965	1,252
Accrued liabilities	10,476	7,586
Total current liabilities	12,441	8,838
Long-term debt	44,785	44,201
Redeemable convertible preferred stock warrant liability	0	16,091
Other liabilities	3,900	1,069
Total liabilities	61,126	70,199
Commitments and contingencies (Note 7)
Redeemable convertible preferred stock issuable in series, $0.001 par value
Liquidation preference: None and $121,144 at September 30, 2019 and December 31, 2018, respectively	0	105,235
Preferred stock, $0.001 par value
Shares issued and outstanding: none	0	0
Common stock, $0.001 par value
Shares issued and outstanding: 30,775,980 and 1,135,310 at September 30, 2019 and December 31, 2018, respectively	31	1
Additional paid-in capital	260,647	4,557
Accumulated deficit	(183,235)	(139,111)
Total stockholders' equity (deficit)	77,443	(134,553)
Total liabilities, redeemable convertible preferred stock and stockholders' equity (deficit)	$ 138,569	$ 40,881

Condensed Consolidated Balance Sheets (unaudited) (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
Statement of Financial Position [Abstract]
Temporary equity, par value (in USD per share)	$ 0.001	$ 0.001
Temporary equity, shares authorized (in shares)	0	24,069,615
Temporary equity, shares issued (in shares)	0	21,233,190
Temporary equity, shares outstanding (in shares)	0	21,233,190
Preferential Liquidation Value (in thousands)	$ 0	$ 121,144
Preferred stock par value (in USD per share)	$ 0.001	$ 0.001
Preferred stock authorized (in shares)	5,000,000	0
Preferred stock issued (in shares)	0	0
Preferred stock outstanding (in shares)	0	0
Common stock, par value (in USD per share)	$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	100,000,000	29,879,220
Common stock, shares issued (in shares)	30,775,980	1,135,310
Common stock, shares outstanding (in shares)	30,775,980	1,135,310

Condensed Consolidated Statements of Operations and Comprehensive Loss (unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Income Statement [Abstract]
Revenue	$ 17,026	$ 9,614	$ 44,721	$ 23,087
Cost of goods sold	4,170	2,882	11,206	7,207
Gross profit	12,856	6,732	33,515	15,880
Operating expenses:
Research and development	3,187	2,442	9,008	6,868
Selling, general and administrative	17,064	8,973	45,064	23,108
Total operating expenses	20,251	11,415	54,072	29,976
Loss from operations	(7,395)	(4,683)	(20,557)	(14,096)
Interest income	565	28	1,215	65
Interest expense	(1,176)	(1,065)	(3,736)	(3,065)
Other income (expense), net	(1)	(3,233)	(21,046)	(4,915)
Net loss	(8,007)	(8,953)	(44,124)	(22,011)
Comprehensive loss	(8,007)	(8,953)	(44,124)	(22,011)
Net loss attributable to non-controlling interest	0	1	0	1
Comprehensive loss attributable to non-controlling interest	0	1	0	1
Net loss attributable to Silk Road Medical, Inc. common stockholders	(8,007)	(8,952)	(44,124)	(22,010)
Comprehensive loss attributable to Silk Road Medical, Inc. common stockholders	$ (8,007)	$ (8,952)	$ (44,124)	$ (22,010)
Net loss per share, basic and diluted (in USD per share)	$ (0.26)	$ (8.49)	$ (2.18)	$ (24.14)
Weighted average common shares used to compute net loss per share, basic and diluted (in shares)	30,764,354	1,054,794	20,249,580	911,873

Condensed Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders' Equity (Deficit) (unaudited) - USD ($) $ in Thousands	Total	IPO	Redeemable Convertible Preferred Stock	Redeemable Convertible Preferred Stock IPO	Common Stock	Common Stock IPO	Additional Paid-in Capital	Accumulated Deficit	Non-controlling Interest
Beginning balance at Dec. 31, 2017	$ (98,578)				$ 1		$ 2,977	$ (101,556)	$ 0
Beginning balance (in shares) at Dec. 31, 2017					663,270
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Exercise of stock options	284						284
Exercise of stock options (in shares)					186,944
Employee stock-based compensation	164						164
Nonemployee stock-based compensation	(2)						(2)
Net loss	(5,408)							(5,408)
Comprehensive loss	(5,408)							(5,408)
Ending balance at Mar. 31, 2018	(103,453)				$ 1		3,436	(106,890)	0
Ending balance (in shares) at Mar. 31, 2018					850,214
Temporary equity, beginning balance at Dec. 31, 2017			$ 105,235
Temporary equity, beginning balance (in shares) at Dec. 31, 2017			21,233,190
Temporary equity, ending balance at Mar. 31, 2018			$ 105,235
Temporary equity, ending balance (in shares) at Mar. 31, 2018			21,233,190
Beginning balance at Dec. 31, 2017	(98,578)				$ 1		2,977	(101,556)	0
Beginning balance (in shares) at Dec. 31, 2017					663,270
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(22,011)
Comprehensive loss	(22,011)
Ending balance at Sep. 30, 2018	(119,169)				$ 1		4,323	(123,493)	0
Ending balance (in shares) at Sep. 30, 2018					1,097,838
Temporary equity, beginning balance at Dec. 31, 2017			$ 105,235
Temporary equity, beginning balance (in shares) at Dec. 31, 2017			21,233,190
Temporary equity, ending balance at Sep. 30, 2018			$ 105,235
Temporary equity, ending balance (in shares) at Sep. 30, 2018			21,233,190
Beginning balance at Mar. 31, 2018	(103,453)				$ 1		3,436	(106,890)	0
Beginning balance (in shares) at Mar. 31, 2018					850,214
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Exercise of stock options	148						148
Exercise of stock options (in shares)					106,732
Employee stock-based compensation	178						178
Nonemployee stock-based compensation	151						151
Net loss	(7,651)							(7,651)
Comprehensive loss	(7,651)							(7,651)
Ending balance at Jun. 30, 2018	(110,627)				$ 1		3,913	(114,541)	0
Ending balance (in shares) at Jun. 30, 2018					956,946
Temporary equity, beginning balance at Mar. 31, 2018			$ 105,235
Temporary equity, beginning balance (in shares) at Mar. 31, 2018			21,233,190
Temporary equity, ending balance at Jun. 30, 2018			$ 105,235
Temporary equity, ending balance (in shares) at Jun. 30, 2018			21,233,190
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Exercise of stock options	216						216
Exercise of stock options (in shares)					140,892
NeuroCo common stock issuance	1								1
Employee stock-based compensation	179						179
Nonemployee stock-based compensation	15						15
Net loss	(8,953)							(8,952)	(1)
Comprehensive loss	(8,953)							(8,952)	(1)
Ending balance at Sep. 30, 2018	(119,169)				$ 1		4,323	(123,493)	$ 0
Ending balance (in shares) at Sep. 30, 2018					1,097,838
Temporary equity, ending balance at Sep. 30, 2018			$ 105,235
Temporary equity, ending balance (in shares) at Sep. 30, 2018			21,233,190
Beginning balance at Dec. 31, 2018	(134,553)				$ 1		4,557	(139,111)
Beginning balance (in shares) at Dec. 31, 2018					1,135,310
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Exercise of stock options	375						375
Exercise of stock options (in shares)					251,305
Employee stock-based compensation	241						241
Nonemployee stock-based compensation	21						21
Net loss	(24,158)							(24,158)
Comprehensive loss	(24,158)							(24,158)
Ending balance at Mar. 31, 2019	(158,074)				$ 1		5,194	(163,269)
Ending balance (in shares) at Mar. 31, 2019					1,386,615
Temporary equity, beginning balance at Dec. 31, 2018	$ 105,235		$ 105,235
Temporary equity, beginning balance (in shares) at Dec. 31, 2018	21,233,190		21,233,190
Increase (Decrease) in Temporary Equity [Roll Forward]
Exercise of warrants	$ 0		$ 30
Exercise of warrants (in shares)			4,915
Temporary equity, ending balance at Mar. 31, 2019			$ 105,265
Temporary equity, ending balance (in shares) at Mar. 31, 2019			21,238,105
Beginning balance at Dec. 31, 2018	$ (134,553)				$ 1		4,557	(139,111)
Beginning balance (in shares) at Dec. 31, 2018					1,135,310
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Exercise of stock options (in shares)	456,147
Net loss	$ (44,124)
Comprehensive loss	(44,124)
Ending balance at Sep. 30, 2019	77,443				$ 31		260,647	(183,235)
Ending balance (in shares) at Sep. 30, 2019					30,775,980
Temporary equity, beginning balance at Dec. 31, 2018	$ 105,235		$ 105,235
Temporary equity, beginning balance (in shares) at Dec. 31, 2018	21,233,190		21,233,190
Temporary equity, ending balance at Sep. 30, 2019	$ 0		$ 0
Temporary equity, ending balance (in shares) at Sep. 30, 2019	0		0
Beginning balance at Mar. 31, 2019	$ (158,074)				$ 1		5,194	(163,269)
Beginning balance (in shares) at Mar. 31, 2019					1,386,615
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Exercise of stock options	364				$ 1		363
Exercise of stock options (in shares)					176,576
Issuance of common stock in connection with IPO, net of underwriting discount, commissions and offering costs of $2,561	109,039				$ 6		109,033
Issuance of common stock in connection with IPO, net of underwriting discount, commissions and offering costs (in shares)					6,000,000
Employee stock-based compensation	814						814
Nonemployee stock-based compensation	22						22
Net loss	(11,959)							(11,959)
Comprehensive loss	(11,959)							(11,959)
Ending balance at Jun. 30, 2019	84,377				$ 31		259,574	(175,228)
Ending balance (in shares) at Jun. 30, 2019					30,747,714
Temporary equity, beginning balance at Mar. 31, 2019			$ 105,265
Temporary equity, beginning balance (in shares) at Mar. 31, 2019			21,238,105
Increase (Decrease) in Temporary Equity [Roll Forward]
Exercise of warrants	31	$ 0	$ 1,754	$ 37,121			31
Exercise of warrants (in shares)			287,446	1,653,004	3,764	2,204
Conversion of preferred stock to common stock upon IPO	144,140		$ (144,140)		$ 23		144,117
Conversion of preferred stock to common stock upon IPO (in shares)			(23,178,555)		23,178,555
Temporary equity, ending balance at Jun. 30, 2019			$ 0
Temporary equity, ending balance (in shares) at Jun. 30, 2019			0
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Exercise of stock options	68						68
Exercise of stock options (in shares)					28,266
Decrease in IPO offering costs	80						80
Employee stock-based compensation	902						902
Nonemployee stock-based compensation	23						23
Net loss	(8,007)							(8,007)
Comprehensive loss	(8,007)							(8,007)
Ending balance at Sep. 30, 2019	77,443				$ 31		$ 260,647	$ (183,235)
Ending balance (in shares) at Sep. 30, 2019					30,775,980
Temporary equity, ending balance at Sep. 30, 2019	$ 0		$ 0
Temporary equity, ending balance (in shares) at Sep. 30, 2019	0		0

Condensed Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders' Equity (Deficit) (unaudited) (Parenthetical) $ in Thousands	3 Months Ended
	Sep. 30, 2019 USD ($)
Statement of Stockholders' Equity [Abstract]
Payments of stock issuance costs	$ 2,561

Condensed Consolidated Statements of Cash Flows (unaudited) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Cash flows from operating activities
Net loss	$ (44,124)	$ (22,011)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization expense	530	325
Stock-based compensation expense	2,023	685
Change in fair value of redeemable convertible preferred stock warrant liability	21,030	4,907
Amortization of debt discount and debt issuance costs	34	57
Amortization of right-of-use asset	440
Non-cash interest expense	595	1,153
Provision for sales returns and allowances	1,163	1,255
Provision for excess and obsolete inventories	78	0
Changes in assets and liabilities
Accounts receivable	(3,575)	(1,515)
Inventories	(3,609)	(1,925)
Prepaid expenses and other current assets	(2,096)	(437)
Other assets	764	(58)
Accounts payable	712	(565)
Accrued liabilities	2,255	1,379
Other liabilities	(569)	445
Net cash used in operating activities	(24,349)	(16,305)
Cash flows from investing activities
Purchases of property and equipment	(337)	(2,168)
Net cash used in investing activities	(337)	(2,168)
Cash flows from financing activities
Proceeds from long-term debt	0	15,000
Proceeds from initial public offering, net of underwriting discount, commissions and offering costs paid	109,352	0
Proceeds from issuance of common stock	806	649
Non-controlling interest	0	1
Net cash provided by financing activities	111,973	15,650
Net change in cash, cash equivalents and restricted cash	87,287	(2,823)
Cash, cash equivalents and restricted cash, beginning of period	25,300	33,841
Cash, cash equivalents and restricted cash, end of period	112,587	31,018
Supplemental disclosure of cash flow information
Cash paid for interest	3,107	1,855
Non-cash investing and financing activities:
Accounts payable and accrued liabilities for purchases of property and equipment	9	26
Landlord paid tenant improvements	0	794
Right-of-use asset obtained in exchange for lease obligation	3,982
Net exercise of convertible preferred stock warrants to preferred stock	37,121	0
Conversion of convertible preferred stock to common stock upon initial public offering	144,140	0
Redeemable Convertible Preferred Stock
Cash flows from financing activities
Proceeds from exercise of warrants	1,784	0
Common Stock Warrant
Cash flows from financing activities
Proceeds from exercise of warrants	$ 31	$ 0

Formation and Business of the Company	9 Months Ended
Formation and Business of the Company	Sep. 30, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Formation and Business of the Company	Formation and Business of the Company The Company Silk Road Medical, Inc. (the “Company”) was incorporated in the state of Delaware on March 21, 2007. The Company has developed a technologically advanced, minimally-invasive solution for patients with carotid artery disease who are at risk for stroke. The Company's portfolio of TCAR products enable a new procedure, referred to as transcarotid artery revascularization, or TCAR, that combines the benefits of endovascular techniques and surgical principles. The Company manufactures and sells in the United States its portfolio of TCAR products which are designed to provide direct access to the carotid artery, effective reduction in stroke risk throughout the procedure, and long-term restraint of carotid plaque. The Company commercialized its products in the United States in April 2016. Reverse Stock Split On March 13, 2019, the Company's Board of Directors approved an amendment to the Company's amended and restated certificate of incorporation to effect a 2.7-for-1 reverse stock split of the Company's common stock and redeemable convertible preferred stock. The par values of the common stock and redeemable convertible preferred stock were not adjusted as a result of the reverse stock split. All common stock, redeemable convertible preferred stock, stock options and warrants, and related per share amounts in the condensed consolidated financial statements have been retroactively adjusted for all periods presented to give effect to the reverse stock split. The reverse stock split was effected on March 27, 2019. Public Offerings In April 2019, the Company issued and sold 6,000,000 shares of its common stock in its initial public offering (“IPO”) at a public offering price of $20.00 per share, for net proceeds of approximately $109,119,000 after deducting underwriting discounts and commissions of approximately $8,400,000 and expenses of approximately $2,481,000. Upon the closing of the IPO, all shares of redeemable convertible preferred stock then outstanding converted into shares of common stock and the Company's outstanding warrants to purchase shares of common and redeemable convertible preferred stock were exercised, or automatically net exercised absent a prior election. The exercises resulted in the reclassification of the fair value of the related redeemable convertible preferred stock warrant liability to additional paid-in capital. In August 2019, the Company completed a secondary public offering of 4,200,000 shares of its common stock sold by certain selling stockholders, and the exercise in full of the underwriters' option to purchase 630,000 additional shares of its common stock from certain selling stockholders, at a public offering price of $39.50 per share. The Company did not receive any of the proceeds from the sale of the shares of its common stock by the selling stockholders.

Summary of Significant Accounting Policies

9 Months Ended

Sep. 30, 2019

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Basis of Preparation

The accompanying financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America, or U.S. GAAP, and applicable rules and regulations of the Securities and Exchange Commission, or SEC, regarding interim financial reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by U.S. GAAP have been condensed or omitted, and accordingly the balance sheet as of December 31, 2018, and related disclosures, have been derived from the audited consolidated financial statements at that date but does not include all of the information required by U.S. GAAP for complete consolidated financial statements. These unaudited condensed consolidated financial statements have been prepared on the same basis as the Company’s annual consolidated financial statements and, in the opinion of management, reflect all adjustments (consisting only of normal recurring adjustments) that are necessary for the fair statement of the Company’s condensed consolidated financial information. The results of operations for the three and nine months ended September 30, 2019 are not necessarily indicative of the results to be expected for the year ending December 31, 2019 or for any other interim period or for any other future year.

The accompanying interim unaudited condensed consolidated financial statements and related financial information should be read in conjunction with the audited consolidated financial statements and the related notes thereto for the year ended December 31, 2018 included in the Company’s prospectus dated April 3, 2019 filed pursuant to Rule 424(b)(4) with the SEC on April 4, 2019.

Principles of Consolidation

Through December 17, 2018, the condensed consolidated financial statements of the Company include the accounts of Silk Road Medical, Inc. and its consolidated variable interest entity (“VIE”), NeuroCo, Inc. On December 17, 2018, the Company acquired all assets and assumed all liabilities of its VIE. As a result of the Merger, NeuroCo merged into the Company with the Company being the surviving corporation. All intercompany balances and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts and disclosures reported in the financial statements. Management uses significant judgment when making estimates related to the common stock valuation and related stock-based compensation, the valuation of the redeemable convertible preferred stock warrants, the valuation of deferred tax assets, provisions for doubtful accounts receivable and excess and obsolete inventories, clinical trial accruals, and the reserves for sales returns. Management bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Although these estimates are based on the Company’s knowledge of current events and actions it may undertake in the future, actual results may ultimately materially differ from these estimates and assumptions.

Fair Value of Financial Instruments

The Company has evaluated the estimated fair value of its financial instruments as of September 30, 2019 and December 31, 2018. The carrying amounts of cash equivalents, restricted cash, accounts receivable, accounts payable and accrued liabilities approximate their respective fair values because of the short-term nature of these instruments. Prior to its IPO, fair value accounting was applied to the redeemable convertible preferred stock warrant liability.

Cash, Cash Equivalents and Restricted Cash

The Company considers all highly liquid investments with an original maturity of three months or less at the time of purchase to be cash equivalents. Cash equivalents are considered available-for-sale marketable securities and are recorded at fair value, based on quoted market prices. As of September 30, 2019 and December 31, 2018, the Company’s cash equivalents are entirely comprised of investments in money market funds.

Restricted cash as of September 30, 2019 and December 31, 2018 consists of a letter of credit of $310,000 representing collateral for the Company's facility lease.

Concentration of Credit Risk, and Other Risks and Uncertainties

Financial instruments that potentially subject the Company to credit risk consist of cash and cash equivalents and accounts receivable to the extent of the amounts recorded on the condensed consolidated balance sheet.

The Company’s policy is to invest in money market funds, which are classified as cash equivalents on the condensed consolidated balance sheet. The Company's cash is held in Company accounts at two financial institutions and such amounts may exceed federally insured limits. The Company's money market funds are invested in highly rated money market funds.

The Company provides for uncollectible amounts when specific credit problems are identified. In doing so, the Company analyzes historical bad debt trends, customer credit worthiness, current economic trends and changes in customer payment patterns when evaluating the adequacy of the allowance for doubtful accounts.

The Company’s accounts receivable are due from a variety of health care organizations in the United States. At September 30, 2019 and December 31, 2018, no customer represented 10% or more of the Company’s accounts receivable. For the three and nine months ended September 30, 2019 and September 30, 2018, there were no customers that represented 10% or more of revenue.

The Company manufactures certain of its commercial products in-house. Certain of the Company’s product components and sub-assemblies continue to be manufactured by sole suppliers, the most significant of which is the ENROUTE stent. Disruption in component or sub-assembly supply from these manufacturers or from in-house production would have a negative impact on the Company’s financial position and results of operations.

The Company is subject to certain risks, including that its devices may not be approved or cleared for marketing by governmental authorities or be successfully marketed. There can be no assurance that the Company’s products will achieve widespread adoption in the marketplace, nor can there be any assurance that existing devices or any future devices can be developed or manufactured at an acceptable cost and with appropriate performance characteristics. The Company is also subject to risks common to companies in the medical device industry, including, but not limited to, new technological innovations, dependence upon third-party payers to provide adequate coverage and reimbursement, dependence on key personnel and suppliers, protection of proprietary technology, product liability claims, and compliance with government regulations.

Existing or future devices developed by the Company may require approvals or clearances from the FDA or international regulatory agencies. In addition, in order to continue the Company’s operations, compliance with various federal and state laws is required. If the Company were denied or delayed in receiving such approvals or clearances, it may be necessary to adjust operations to align with the Company’s currently approved portfolio. If clearance for the products in the current portfolio were withdrawn by the FDA, this would have a material adverse impact on the Company.

Deferred Public Offering Costs

Specific incremental legal, accounting and other fees and costs directly attributable to a proposed or actual offering of securities may properly be deferred and charged against the gross proceeds of the offering. As of September 30, 2019 and December 31, 2018, there were $0 and $950,000, respectively, of offering costs primarily consisting of legal and accounting fees that were capitalized in other non-current assets on the condensed consolidated balance sheet.

Leases

The Company adopted Accounting Standards Codification (“ASC”) 842, "Leases," on January 1, 2019 and used the modified retrospective method for all leases not substantially completed as of the date of adoption and the package of practical expedients available in the standard. As a result of adopting ASC 842, the Company recorded an operating lease right-of-use ("ROU") asset of $3,982,000 included within other non-current assets and operating lease liabilities of $5,190,000 included within accrued liabilities and other liabilities on the condensed consolidated balance sheet related to its facility lease, based on the present value of the future lease payments on the date of adoption. The operating lease right-of-use asset also includes adjustments for prepayments and excludes lease incentives. The adoption did not have an impact on prior periods or on its condensed consolidated statements of operations and comprehensive loss.

In accordance with ASC 842, the disclosure impact of adoption on the condensed consolidated balance sheet were as follows (in thousands):


Balance Sheet:	Balance at December 31, 2018		Adjustments Due to ASC 842		Balance at January 1, 2019
Other non-current assets	$	—	$	3,982	$	3,982
Accrued liabilities	139		582		721
Other liabilities	1,069		3,400		4,469

The Company recognizes ROU assets and lease liabilities when it obtains the right to control an asset under a leasing arrangement with an initial term greater than twelve months. The Company evaluates the nature of each lease at the inception of an arrangement to determine whether it is an operating or financing lease and recognizes the right-of-use asset and lease liabilities based on the present value of future minimum lease payments over the expected lease term. The Company’s leases do not generally contain an implicit interest rate and therefore the Company uses the incremental borrowing rate it would expect to pay to borrow on a similar collateralized basis over a similar term in order to determine the present value of its lease payments. The Company’s considers renewal options in the determination of the lease term if the option to renew is reasonably certain. The Company has elected to account separately for contracts that contain lease and non-lease components consistent with its historical practice. Variable lease payments will be expensed as incurred.

Redeemable Convertible Preferred Stock Warrant Liability

Prior to its IPO, the Company accounted for its warrants for shares of redeemable convertible preferred stock as a liability based upon the characteristics and provisions of each instrument. Redeemable convertible preferred stock warrants classified as a liability were initially recorded at their fair value on the date of issuance and were subject to remeasurement at each subsequent balance sheet date. Any change in fair value as a result of a remeasurement was recognized as a component of other income (expense), net in the condensed consolidated statements of operations and comprehensive loss. The Company recorded adjustments to the estimated fair value of the redeemable convertible preferred stock warrants until they were exercised. Upon their exercise, the final fair value of the warrant liability was reclassified to stockholders’ equity (deficit). Subsequent to its IPO, the Company no longer recorded any related periodic fair value adjustments.

Redeemable Convertible Preferred Stock

Prior to its IPO, the Company recorded its redeemable convertible preferred stock at fair value on the dates of issuance, net of issuance costs, and classified the redeemable convertible preferred stock outside of stockholders’ equity (deficit) on the balance sheet as events triggering the liquidation preferences were not solely within the Company’s control. Upon the closing of the Company's IPO, all shares of convertible preferred stock then outstanding converted into an aggregate of 23,178,555 shares of common stock resulting in the reclassification of $144,140,000 from outside of stockholders’ equity (deficit) to additional paid-in capital.

Revenue Recognition

On January 1, 2018, the Company adopted ASC Topic 606, "Revenue from Contracts with Customers," using the modified retrospective method applied to contracts which were not completed as of that date. Revenue for reporting periods beginning after January 1, 2018 are presented under ASC 606, while prior period revenue amounts are not adjusted and continue to be reported in accordance with the Company’s historic accounting under ASC 605, "Revenue Recognition." Under ASC 606, revenue is recognized when a customer obtains control of promised goods or services, in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. To determine revenue recognition for arrangements that an entity determines are within the scope of ASC 606, the Company performs the following five steps:

(i) identify the contract(s) with a customer;

(ii) identify the performance obligations in the contract;

(iii) determine the transaction price;

(iv) allocate the transaction price to the performance obligations in the contract; and

(v) recognize revenue when (or as) the entity satisfies a performance obligation.

Under ASC 606, assuming all other revenue recognition criteria have been met, the Company will recognize revenue earlier for arrangements where the Company has satisfied its performance obligations but have not issued invoices. As of September 30, 2019 and December 31, 2018, the Company recorded $149,000 and $128,000, respectively, of unbilled receivables, which are included in accounts receivable, net on the condensed consolidated balance sheet, as the Company has an unconditional right to payment as of the end of the applicable period.

The Company’s revenue is generated from the sale of its products to hospitals and medical centers in the United States through direct sales representatives. Revenue is recognized when obligations under the terms of a contract with customers are satisfied, which occurs with the transfer of control of the Company’s products to its customers, either upon shipment of the product or delivery of the product to the customer under the Company’s standard terms and conditions. The Company’s products are readily available for usage as soon as the customer possesses it. Upon receipt, the customer controls the economic benefits of the product, has significant risks and rewards, and the legal title. The Company has present right to payment; therefore, the transfer of control is deemed to happen at a point in time. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring the goods.

For sales where the Company’s sales representative hand delivers product directly to the hospital or medical center from the sales representative’s trunk stock inventory, the Company recognizes revenue upon delivery, which represents the point in time when control transfers to the customer. Upon delivery there are legally-enforceable rights and obligations between the parties which can be identified, commercial substance exists and collectability is probable. For sales which are sent directly from the Company to hospitals and medical centers, the transfer of control occurs at the time of shipment or delivery of the product. There are no further performance obligations by the Company or the sales representative to the customer after delivery under either method of sale. As allowed under the practical expedient, the Company does not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts for which it recognizes revenue at the amount to which it has the right to invoice for services performed.

The Company is entitled to the total consideration for the products ordered by customers as product pricing is fixed according to the terms of customer contracts and payment terms are short. Payment terms fall within the one-year guidance for the practical expedient which allows the Company to forgo adjustment of the promised amount of consideration for the effects of a significant financing component. The Company excludes taxes assessed by governmental authorities on revenue-producing transactions from the measurement of the transaction price.

Costs associated with product sales include commissions and royalties. The Company applies the practical expedient and recognizes commissions and royalties as expense when incurred because the expense is incurred at a point in time and the amortization period is less than one year. Commissions are recorded as selling expense and royalties are recorded as cost of goods sold in the condensed consolidated statements of operations and comprehensive loss.

The Company accepts product returns at its discretion or if the product is defective as manufactured. The Company establishes estimated provisions for returns based on historical experience. The Company elected to expense shipping and handling costs as incurred and includes them in the cost of goods sold. Where the Company bills shipping and handling costs to customers, it will classify the amounts billed as a component of revenue.

Cost of Goods Sold

The Company manufactures certain of its portfolio of TCAR products at its facility and purchases other products from third party manufacturers. Cost of goods sold consists primarily of costs related to materials, components and subassemblies, manufacturing overhead costs, direct labor, reserves for excess, obsolete and non-sellable inventories as well as distribution-related expenses. A significant portion of the Company’s cost of goods sold currently consists of manufacturing overhead costs. These overhead costs include the cost of quality assurance, material procurement, inventory control, facilities, equipment and operations supervision and management. Cost of goods sold also includes depreciation expense for production equipment and certain direct costs such as shipping costs and royalties.

Stock–Based Compensation

The Company accounts for stock-based compensation in accordance with Financial Accounting Standards Board (“FASB”) ASC 718, "Compensation-Stock Compensation." ASC 718 requires the recognition of compensation expense, using a fair-value based method, for costs related to all share-based payments including stock options. ASC 718 requires companies to estimate the fair value of all share-based payment option awards on the date of grant using an option pricing model. The fair value of stock options is recognized over the period during which an optionee is required to provide services in exchange for the option award, known as the requisite service period (usually the vesting period), on a straight-line basis. For performance-based stock options, the Company will assess the probability of performance conditions being achieved in each reporting period. The amount of stock-based compensation expense recognized in any one period related to performance-based stock options can vary based on the achievement or anticipated achievement of the performance conditions. The Company accounts for option forfeitures as they occur.

Income Taxes

The Company accounts for income taxes under the liability method, whereby deferred tax assets and liabilities are determined based on the difference between the condensed consolidated financial statements and tax bases of assets and liabilities using the enacted tax rates in effect for the year in which the differences are expected to affect taxable income. A valuation allowance is established when necessary to reduce deferred tax assets to the amounts expected to be realized. As the Company has historically incurred operating losses, it has established a full valuation allowance against its net deferred tax assets, and there is no provision for income taxes.

The Company also follows the provisions of ASC 740-10, "Accounting for Uncertainty in Income Taxes." ASC 740-10 prescribes a comprehensive model for the recognition, measurement, presentation and disclosure in financial statements of any uncertain tax positions that have been taken or expected to be taken on a tax return. No liability related to uncertain tax positions is recorded on the condensed consolidated financial statements. It is the Company's policy to include penalties and interest expense related to income taxes as part of the provision for income taxes.

Net Loss per Share

Basic net loss per share is computed by dividing the net loss by the weighted average number of shares of common stock outstanding during the period, without consideration for potential dilutive common shares. Diluted net loss per share is computed by dividing the net loss by the weighted average number of shares of common stock and potentially dilutive securities outstanding for the period. For purposes of the diluted net loss per share calculation, redeemable convertible preferred stock and warrants, and common stock options are considered to be potentially dilutive securities. Since the Company was in a loss position for all periods presented, basic net loss per share is the same as diluted net loss per share as the inclusion of all potential dilutive common shares would have been anti-dilutive.

The Company allocates no loss to participating securities because they have no contractual obligation to share in the losses of the Company. The shares of the Company’s redeemable convertible preferred stock participate in any dividends declared by the Company and are therefore considered to be participating securities.

Net loss per share was determined as follows (in thousands, except share and per share data):


	Three Months Ended September 30,						Nine Months Ended September 30,
	2019		2018		2019		2018
Net loss	$	(8,007)	$	(8,952)	$	(44,124)	$	(22,010)
Weighted average common stock outstanding used to compute net loss per share, basic and diluted	30,764,354		1,054,794		20,249,580		911,873
Net loss per share, basic and diluted	$	(0.26)	$	(8.49)	$	(2.18)	$	(24.14)

The following potentially dilutive securities outstanding have been excluded from the computation of diluted weighted average shares outstanding because such securities have an antidilutive impact due to the Company's net loss, in common stock equivalent shares:


	September 30,
	2019	2018
Redeemable convertible preferred stock outstanding	—	21,233,190
Redeemable convertible preferred stock warrants outstanding	—	2,672,502
Common stock options	4,677,878	4,292,056
Common stock warrants outstanding	—	7,527
	4,677,878	28,205,275

Comprehensive Loss

For the three and nine months ended September 30, 2019 and September 30, 2018, there was no difference between comprehensive loss and the Company’s net loss.

Segment and Geographical Information

The Company operates and manages its business as one reportable and operating segment. The Company’s chief executive officer, who is the chief operating decision maker, reviews financial information on an aggregate basis for purposes of allocating resources and evaluating financial performance. All of the Company’s long-lived assets are based in the United States. Long-lived assets are comprised of property and equipment. All of the Company’s revenue was in the United States for the three and nine months ended September 30, 2019 and September 30, 2018, based on the shipping location of the external customer.

Recent Accounting Pronouncements	9 Months Ended
Recent Accounting Pronouncements	Sep. 30, 2019
Accounting Changes and Error Corrections [Abstract]
Recent Accounting Pronouncements	Recent Accounting Pronouncements Recently Adopted Accounting Standards In February 2016, the FASB issued ASU No. 2016-02, "Leases," that supersedes ASC 840, "Leases." Subsequently, the FASB issued several updates to ASU No. 2016-02, codified in ASC Topic 842 (“ASC 842”). The Company adopted ASC 842 on January 1, 2019 using the modified retrospective method for all leases not substantially completed as of the date of adoption. The Company elected to apply the package of practical expedients, which allowed the Company to not reassess: (i) whether expired or existing contracts contain leases; (ii) lease classification for any expired or existing leases; and (iii) initial direct costs for any existing lease. Recently Issued Accounting Standards In June 2016, the FASB issued ASU 2016-13, "Measurement of Credit Losses on Financial Statements." This update provides financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. The update replaces the incurred loss impairment methodology in current U.S. GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. ASU No. 2016-13 is effective for public entities for annual periods beginning after December 15, 2019. The Company is evaluating the impact of adopting this guidance to its consolidated financial statements and related disclosures. In August 2018, the FASB issued ASU 2018-13, "Fair Value Measurement," which changed the disclosure requirements for fair value measurements by removing, adding and modifying certain disclosures. The standard is effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted. The Company is evaluating the impact of adopting this guidance to its consolidated financial statements and related disclosures. In August 2018, the FASB issued ASU 2018-15, "Cloud Computing Arrangements," which aligns the requirements for capitalizing implementation costs in a Cloud Computing Arrangement service contract with the requirements for capitalizing implementation costs incurred for an internal-use software license. The standard is effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted. The Company is evaluating the impact of adopting this guidance to its consolidated financial statements and related disclosures.

Fair Value Measurements

9 Months Ended

Sep. 30, 2019

Fair Value Disclosures [Abstract]

Fair Value Measurements

The Company measures certain financial assets and liabilities at fair value on a recurring basis. Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability. A three-tier fair value hierarchy is established as a basis for considering such assumptions and for inputs used in the valuation methodologies in measuring fair value:

•Level 1 – quoted prices in active markets for identical assets or liabilities;

•Level 2 – observable inputs other than quoted prices in active markets for identical assets and liabilities;

•Level 3 – unobservable inputs.

The Company’s cash equivalents are classified within Level 1 of the fair value hierarchy because they are valued using quoted market prices, broker or dealer quotations, or alternative pricing sources with reasonable levels of price transparency. Management believes that borrowings under its term loan bear interest at the prevailing market rates for instruments with similar characteristics (a Level 2 input); accordingly, the carrying value of this instrument approximates its fair value.

In August 2014 through April 2016, the Company issued warrants to purchase 2,672,502 shares of Series C redeemable convertible preferred stock at the exercise price of $6.11 per share. As a derivative liability, the redeemable convertible warrants were initially recorded at fair value and were subject to remeasurement at each balance sheet date through the date of the Company's initial public offering in April 2019. Any change in fair value as a result of a remeasurement was recognized as a component of other income (expense), net in the condensed consolidated statements of operations and comprehensive loss. The Company’s redeemable convertible warrant liability was classified within Level 3 of the fair value hierarchy.

At December 31, 2018, the fair value of the redeemable convertible warrant liability was determined by using an option pricing model to allocate the total enterprise value to the various securities within the Company's capital structure. As of December 31, 2018, the fair value of the redeemable convertible warrant liability was based on both the estimated fair value of the Company's common stock and on valuation models discounted at current implied market rates which are based on Level 3 inputs. Additionally, the model's inputs reflect assumptions that market participants would use in pricing the instrument in a current period transaction and included:


						December 31,
						2018
Time to liquidity (years)						0.57
Expected volatility						62.5%
Discounted cash flow rate						12.0%
Risk-free interest rate						2.6%
Marketability discount rate						14%

The final fair value of the redeemable convertible warrants was remeasured on the date of the Company's initial public offering in April 2019. The final fair value of the redeemable convertible warrant liability was based on the estimated fair value of the Company's common stock at the time of its initial public offering. Subsequent to April 2019, there were no changes in fair value.

The following table sets forth the fair value of the Company’s financial liabilities measured on a recurring basis as of December 31, 2018 (in thousands), as of September 30, 2019, there was no redeemable convertible warrant liability:


	December 31, 2018
	Level 1		Level 2		Level 3		Total
Liabilities
Redeemable convertible warrant liability	$	—	$	—	$	16,091	$	16,091

The changes in the redeemable convertible warrant liability are summarized below (in thousands):


Fair Value at December 31, 2018	$	16,091
Change in fair value recorded in other income (expense), net	21,030
Reclassification upon IPO	(37,121)
Fair Value at September 30, 2019	$	—

There were no transfers between fair value hierarchy levels during the three and nine ended September 30, 2019 and 2018.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Balance Sheet Components

9 Months Ended

Sep. 30, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Balance Sheet Components

Components of inventories were as follows:


(in thousands)	September 30,		December 31,
	2019		2018
Raw materials	$	1,029	$	1,054

Finished products	8,246		4,690
Total	$	9,275	$	5,744

As of September 30, 2019 and December 31, 2018, there were no work-in-process inventories.

Accrued liabilities consist of the following:


(in thousands)	September 30,		December 31,
	2019		2018
Accrued payroll and related expenses	$	6,984	$	5,157
Accrued professional services	841		1,014
Operating lease liability	749		—
Accrued royalty expense	423		313
Deferred revenue	335		137
Accrued travel expenses	394		270
Accrued clinical expenses	197		244
Accrued other expenses	553		451
Total	$	10,476	$	7,586

Long-term Debt

9 Months Ended

Sep. 30, 2019

Debt Disclosure [Abstract]

Long-term Debt

In October 2015, the Company entered into a term loan agreement with CRG. The term loan agreement provides for up to $30,000,000 in term loans split into two tranches as follows: (i) the Tranche A Loans provided for $20,000,000 in term loans, and (ii) the Tranche B Loans provided for up to $10,000,000 in term loans. The Company drew down the Tranche A Loans on October 13, 2015. The Tranche B Loans were available to be drawn prior to March 29, 2017. In January 2017, the term loan agreement was amended to extend the commitment period of the Tranche B Loans to April 28, 2017. In April 2017, the Company drew down $5,000,000 of the available Tranche B Loans.

In September 2018, the Company entered into Amendment No. 5 to the term loan agreement with CRG. Under the amended terms of the amended loan agreement the maturity date was extended to December 31, 2022 and the repayment schedule of the existing term loans were changed to interest only so that the outstanding principal amount of the term loans will be payable in a single installment at maturity. The related fixed interest rate was changed to equal 10.75% per annum, due and payable quarterly in arrears. At the election of the Company, 2.75% of the interest due and payable may be “paid in kind”, or PIK, and added to the then outstanding principal and 8.0% of the interest due and payable paid in cash. All unpaid principal, and accrued and unpaid interest, is due and payable in full on December 31, 2022. The amended term loan agreement also provided for additional term loans in an aggregate principal amount of up to $25,000,000. In September 2018, the Company drew down an additional $15,000,000 under the term loan agreement with CRG. As provided for under the terms of the amended term loan agreement, the related fixed interest rate was further reduced to 10.0% upon the consummation of the Company's IPO in April 2019. Also, post consummation of the Company's IPO, 8.0% of the interest is due and payable in cash and at the election of the Company, 2.0% of the interest due and payable may be PIK.

The Company may voluntarily prepay the borrowings in full. The Tranche A borrowing required a payment, on the borrowing date, of a financing fee equal to 1.75% of the borrowed loan principal, which is recorded as a discount to the debt. In addition, a facility fee equal to 5.0% of the amounts borrowed plus any PIK is payable at the end of the term or when the borrowings are repaid in full. A long-term liability is being accreted using the effective interest method for the facility fee over the term of the loan agreement. The borrowings are collateralized by a security interest in substantially all of the Company’s assets.

The Company is subject to financial covenants related to liquidity and minimum trailing revenue targets that began in December 31, 2016 and are tested on an annual basis. The liquidity covenant requires the Company to maintain an amount which shall exceed the greater of (i) $3,000,000 and (ii) the minimum cash balance, if any, required of the Company by a creditor to the extent the Company has incurred permitted priority debt. The Company had to achieve minimum net revenue of $1,000,000 in 2016, $5,000,000 in 2017, $15,000,000 in 2018, and must achieve minimum net revenue of $30,000,000 in 2019 and $40,000,000 in 2020. The liquidity financial covenant has a 90-day equity cure period following end of the calendar year to issue additional shares of equity interests in exchange for cash, or to borrow permitted cure debt. In addition, the term loan agreement prohibits the payment of cash dividends on the Company’s capital stock and also places restrictions on mergers, sales of assets, investments, incurrence of liens, incurrence of indebtedness and transactions with affiliates. CRG may accelerate the payment terms of the term loan agreement upon the occurrence of certain events of default set forth therein, which include the failure of the Company to make timely payments of amounts due under the term loan agreement, the failure of the Company to adhere to the covenants set forth in the term loan agreement, the insolvency of the Company or upon the occurrence of a material adverse change. As of September 30, 2019, the Company was in compliance with all applicable financial covenants. As of September 30, 2019, management does not believe that it is probable that the above clauses will be triggered within the next twelve months, and therefore, the debt is classified as long-term on the condensed consolidated balance sheet.

In June 2019, the Company entered into Amendment No. 7 to the term loan agreement with CRG to reflect flexibility with respect to permitted cash equivalents.

The issuance costs and debt discount have been netted against the borrowed funds on the condensed consolidated balance sheet. The long-term debt balance as of September 30, 2019 was $44,785,000.

Future maturities under the term loan agreement as of September 30, 2019 are as follows (in thousands):


Period Ending December 31:	Amount
2019	$	1,120
2020	4,454
2021	4,442
2022	48,256
	58,272
Add: Accretion of closing fees	1,122
	59,394
Less: Amount representing interest	(14,458)
Less: Amount representing debt discount and debt issuance costs	(151)
Present value of minimum payments	$	44,785

In October 2015, CRG purchased 327,759 shares of the Company’s Series C redeemable convertible preferred stock at $6.11 per share. In addition,CRG received warrants to purchase 163,877 shares of the Company’s Series C redeemable convertible preferred stock at an exercise price of $.6.11 per share. Upon the closing of the IPO, the warrants were net exercised, based on the IPO price of $20.00 per share, into shares of common stock.

In July 2017, CRG purchased an additional 163,877 shares of the Company’s Series C convertible preferred stock at $6.11 per share.

Commitments and Contingencies

9 Months Ended

Sep. 30, 2019

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Operating Lease and Rights of Use

The Company’s operating lease obligation consists of leased office, laboratory, and manufacturing space under a non-cancellable operating lease that expires in October 2024. Operating lease costs were $217,000 and $652,000 for the three and nine months ended September 30, 2019, respectively. Cash paid for amounts included in the measurement of operating lease liabilities was $178,000 and $540,000 for the three and nine months ended September 30, 2019, respectively. As of September 30, 2019, the weighted average discount rate was approximately 6.50% and the weighted average remaining lease term was 5.08 years. Balance sheet information as of September 30, 2019 consists of the following (in thousands):


Operating Lease:	September 30, 2019
Operating lease right-of-use asset in other non-current assets	$	3,543
Operating lease liability in accrued liabilities	$	749
Operating lease liability in other liabilities	3,901
Total operating lease liabilities	$	4,650

The following table summarizes the Company’s operating lease maturities as of September 30, 2019 (in thousands):


Period Ending December 31:	Amount
2019	$	255
2020	1,037
2021	1,066
2022	1,096
2023	1,127
2024	904
Total lease payments	5,485
Less: imputed interest	(835)
Present value of lease liabilities	$	4,650

Minimum future lease payments previously disclosed under ASC 840 in the Company’s prospectus dated April 3, 2019 filed pursuant to Rule 424(b)(4) with the SEC on April 4, 2019 for the year ended December 31, 2018 are as follows (in thousands):


Year Ending December 31:	Total Minimum Lease Payments
2019	$	1,002
2020	1,002
2021	1,031
2022	1,044
2023	1,920
	$	5,999

Purchase Obligations

Purchase obligations consist of agreements to purchase goods and services entered into in the ordinary course of business. The Company had non-cancellable commitments for inventory that were payable within one year to suppliers for purchases totaling $3,715,000 as of September 30, 2019.

Indemnification

In the normal course of business, the Company enters into contracts and agreements that contain a variety of representations and warranties and may provide for indemnification of the counterparty. The Company’s exposure under these agreements is unknown because it involves claims that may be made against it in the future but have not yet been made. To date, the Company has not been subject to any claims or been required to defend any action related to its indemnification obligations.

The Company indemnifies each of its directors and officers for certain events or occurrences, subject to certain limits, while the director is or was serving at the Company’s request in such capacity, as permitted under Delaware law and in accordance with its certificate of incorporation and bylaws. The term of the indemnification period lasts as long as a director may be subject to any proceeding arising out of acts or omissions of such director in such capacity. The maximum amount of potential future indemnification is unlimited; however, the Company currently holds director liability insurance. This insurance allows the transfer of risk associated with the Company’s exposure and may enable it to recover a portion of any future amounts paid. The Company believes that the fair value of these indemnification obligations is minimal. Accordingly, the Company has not recognized any liabilities relating to these obligations as of September 30, 2019.

Contingencies

The Company is not involved in any pending legal proceedings that it believes could have a material adverse effect on its financial condition, results of operations or cash flows. From time to time, the Company may pursue litigation to assert its legal right and such litigation may be costly and divert the efforts and attention of its management and technical personnel which could adversely affect its business. The Company accrues a liability for such matters when it is probable that future expenditures will be made and such expenditures can be reasonably estimated. There were no contingent liabilities requiring accrual at September 30, 2019 and December 31, 2018.

Legal Matters

In February 2019, a former employee, through counsel, advised the Company that he had filed a charge of discrimination against the Company with the California Department of Fair Employment & Housing, or DFEH. The former employee’s complaint alleges sexual harassment and retaliation in violation of the California Department of Fair Employment & Housing Act. The complaint did not allege specific damages. The Company and the former employee participated in mediation on July 30, 2019 and reached a settlement that required the Company to pay an amount that was not material to its consolidated financial statements, which was fully paid during the three months ended September 30, 2019.

Redeemable Convertible Preferred Stock

9 Months Ended

Sep. 30, 2019

Temporary Equity Disclosure [Abstract]

Redeemable Convertible Preferred Stock

The Company had the following redeemable convertible preferred stock issued and outstanding at December 31, 2018:


	December 31, 2018
	Shares Authorized	Shares Issued and Outstanding	Per share Preference		Preferential Liquidation Value (in thousands)		Carrying Value (in thousands)
Series
Series A	1,629,629	1,629,626	$	2.70	$	4,400	$	4,369
Series A-1	1,111,111	1,111,109	$	3.38	3,755		3,723
Series B	6,264,470	6,264,463	$	6.11	38,276		38,014
Series C	15,064,405	12,227,992	$	6.11	74,713		59,129
	24,069,615	21,233,190			$	121,144	$	105,235

Upon the closing of the IPO, all shares of convertible preferred stock then outstanding converted into shares of common stock. As of September 30, 2019, the Company does not have any convertible preferred stock issued or outstanding.

Preferred Stock Warrants

Upon the closing of the IPO, all of the outstanding convertible preferred stock warrants were exercised, or net exercised based on the IPO price of $20.00 per share, into 1,945,365 shares of common stock.

As of September 30, 2019 and December 31, 2018, warrants to purchase an aggregate of 0 and 2,672,502, respectively, shares of Series C redeemable convertible preferred stock were outstanding.

Stockholders Equity (Deficit)	9 Months Ended
Stockholders Equity (Deficit)	Sep. 30, 2019
Equity [Abstract]
Stockholders Equity (Deficit)	Stockholders Equity (Deficit) Preferred Stock At September 30, 2019, the Company’s certificate of incorporation, as amended and restated, authorizes the Company to issue up to 5,000,000 shares of preferred stock with $0.001 par value per share, of which no shares were issued and outstanding. Common Stock At September 30, 2019, the Company’s certificate of incorporation, as amended and restated, authorizes the Company to issue up to 100,000,000 shares of common stock with $0.001 par value per share, of which 30,775,980 shares were issued and outstanding. The holders of common stock are also entitled to receive dividends whenever funds are legally available, when and if declared by the Board of Directors. As of September 30, 2019, no dividends have been declared to date. Each share of common stock is entitled to one vote. Common Stock Warrants In connection with the IPO, the common stock warrants were cash, or net exercised based on the IPO price of $20.00 per share, into 5,968 shares of common stock. As of September 30, 2019 and December 31, 2018, warrants to purchase an aggregate of 0 and 7,527 shares of common stock were outstanding.

Stock Option Plans

9 Months Ended

Sep. 30, 2019

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock Option Plans

In 2007, the Company established its 2007 Stock Option Plan which provided for the granting of stock options to employees, directors and consultants of the Company. In connection with its acquisition of NeuroCo in December 2018, the Company also assumed NeuroCo’s 2015 Equity Incentive Plan. In March 2019, the Company's Board of Directors approved the termination of the 2007 Stock Option Plan and the NeuroCo 2015 Equity Incentive Plan and the adoption of the 2019 Equity Incentive Plan, or the 2019 Plan, which became effective immediately prior to the Company's IPO. The 2019 Plan provides for the grant of ISOs to employees and for the grant of NSOs, restricted stock, restricted stock units, stock appreciation rights, performance units and performance shares to employees, directors and consultants. A total of 2,317,000 shares of common stock were initially reserved for issuance pursuant to the 2019 Plan. In addition, the shares reserved for issuance under the 2019 Plan will also include shares reserved but not issued under the 2007 Stock Option Plan, plus any share awards granted under the 2007 Stock Option Plan that expire or terminate without having been exercised in full or that are forfeited or repurchased. In addition, the number of shares available for issuance under the 2019 Plan will also include an annual increase on the first day of each fiscal year beginning in fiscal 2020, equal to the lesser of (i) 3,000,000 shares; (ii) 4.0% of the outstanding shares of common stock as of the last day of the immediately preceding fiscal year; or (iii) an amount as determined by the Board of Directors. As of September 30, 2019, the Company has reserved 2,362,933 shares of common stock for issuance under the 2019 Plan.

The exercise price of ISOs and NSOs shall not be less than 100% and 85% of the estimated fair value of the shares on the date of grant, respectively, as determined by the Board of Directors. The exercise price of ISOs and NSOs granted to a 10% stockholder shall not be less than 110% of the estimated fair value of the shares on the date of grant as determined by the Board of Directors. To date, options have a term of 10 years and generally vest over 4 years from the date of grant.

Activity under the Company’s 2007 Stock Option Plan, NeuroCo 2015 Equity Incentive Plan and 2019 Plan is set forth below:


		Options Outstanding
	Shares Available for Grant	Number of Shares	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (in Years)	Aggregate Intrinsic Value (in thousands)





Balances, December 31, 2018	57,889	4,364,377	$	3.79	7.36	$	33,132
Authorized	2,317,000
Options granted	(792,673)	792,673	$	21.82
Options exercised	—	(456,147)	$	1.77
Options cancelled	23,025	(23,025)	$	6.73
Balances, September 30, 2019	1,605,241	4,677,878	$	7.03	7.27	$	120,092
Vested and exercisable at September 30, 2019		2,701,774	$	3.53	6.25	$	78,404
Vested and expected to vest at September 30, 2019		4,677,878	$	7.03	7.27	$	120,092

The aggregate intrinsic value of options exercised during the nine months ended September 30, 2019 was $10,846,000. The aggregate intrinsic value was calculated as the difference between the exercise prices of the underlying options and the estimated fair value of the common stock on the date of exercise.

2019 Employee Stock Purchase Plan

In March 2019, the Company's Board of Directors adopted the 2019 Employee Stock Purchase Plan, or 2019 ESPP, under which eligible employees are permitted to purchase common stock at a discount through payroll deductions. A total of 434,000 shares of common stock are reserved for issuance and will be increased on the first day of each fiscal year, beginning in 2020, by an amount equal to the lesser of (i) 1,200,000 shares (ii) 1.0% of the outstanding shares of common stock as of the last day of the immediately preceding fiscal year; or (iii) an amount as determined by the Board of Directors. The price of the common stock purchased will be the lower of 85% of the fair market value of the common stock at the beginning of an offering period or at the end of a purchase period. The 2019 ESPP was effective upon adoption by the Company's Board of Directors but was not in use until the completion of the Company's IPO in April 2019. The 2019 ESPP is intended to qualify as an "employee stock purchase plan" within the meaning of Section 423 of the Internal Revenue Code of 1986, as amended.

Stock-Based Compensation

The Company estimated the fair value of stock options using the Black–Scholes option pricing model. The fair value of employee and nonemployee stock options is being amortized on a straight–line basis over the requisite service period of the awards. The fair value of employee and nonemployee stock options was estimated using the following assumptions for the three and nine months ended September 30, 2019 and 2018:


	Three Months Ended September 30,			Nine Months Ended September 30,
	2019	2018	2019	2018
Expected term (in years)	6.25	6.25	5.00 - 6.25	5.00 - 6.25
Expected volatility	42.4%	38.3%	42.4% - 42.9%	38.0% - 38.3%
Risk-free interest rate	1.47%	2.90-2.98%	1.47% - 2.54%	2.68% - 2.98%
Dividend yield	—%	—%	—%	—%

As of September 30, 2019, there was total unrecognized compensation costs of $8,493,000 related to these stock options. These costs are expected to be recognized over a period of approximately 3.16 years.

The fair value of the shares to be issued under the Company’s 2019 ESPP was estimated using the Black-Scholes valuation model with the following assumptions for the three and nine months ended September 30, 2019:


	Three Months Ended September 30,	Nine Months Ended September 30,
	2019	2019
Expected term (in years)	0.63	0.63
Expected volatility	47.8%	47.8%
Risk-free interest rate	2.45%	2.45%
Dividend yield	—%	—%

Total stock-based compensation expense recognized during the three and nine months ended September 30, 2019 and 2018, is as follows (in thousands):


	Three Months Ended September 30,						Nine Months Ended September 30,
	2019		2018		2019		2018
Cost of goods sold	$	61	$	12	$	129	$	36
Research and development expenses	134		30		288		220
Selling, general and administrative expenses	730		152		1,606		429
	$	925	$	194	$	2,023	$	685

Summary of Significant Accounting Policies (Policies)

9 Months Ended

Sep. 30, 2019

Accounting Policies [Abstract]

Basis of Preparation

Principles of Consolidation

Principles of ConsolidationThrough December 17, 2018, the condensed consolidated financial statements of the Company include the accounts of Silk Road Medical, Inc. and its consolidated variable interest entity (“VIE”), NeuroCo, Inc. On December 17, 2018, the Company acquired all assets and assumed all liabilities of its VIE. As a result of the Merger, NeuroCo merged into the Company with the Company being the surviving corporation. All intercompany balances and transactions have been eliminated in consolidation.

Use of Estimates

Fair Value of Financial Instruments

Cash, Cash Equivalents and Restricted Cash

Cash, Cash Equivalents and Restricted CashThe Company considers all highly liquid investments with an original maturity of three months or less at the time of purchase to be cash equivalents. Cash equivalents are considered available-for-sale marketable securities and are recorded at fair value, based on quoted market prices.

Concentration of Credit Risk, and Other Risks and Uncertainties

Deferred Public Offering Costs

Deferred Public Offering CostsSpecific incremental legal, accounting and other fees and costs directly attributable to a proposed or actual offering of securities may properly be deferred and charged against the gross proceeds of the offering. As of September 30, 2019 and December 31, 2018, there were $0 and $950,000, respectively, of offering costs primarily consisting of legal and accounting fees that were capitalized in other non-current assets on the condensed consolidated balance sheet.

Leases

In accordance with ASC 842, the disclosure impact of adoption on the condensed consolidated balance sheet were as follows (in thousands):


Balance Sheet:	Balance at December 31, 2018		Adjustments Due to ASC 842		Balance at January 1, 2019
Other non-current assets	$	—	$	3,982	$	3,982
Accrued liabilities	139		582		721
Other liabilities	1,069		3,400		4,469

Redeemable Convertible Preferred Stock Warrant Liability

Redeemable Convertible Preferred Stock

Redeemable Convertible Preferred StockPrior to its IPO, the Company recorded its redeemable convertible preferred stock at fair value on the dates of issuance, net of issuance costs, and classified the redeemable convertible preferred stock outside of stockholders’ equity (deficit) on the balance sheet as events triggering the liquidation preferences were not solely within the Company’s control.

Revenue Recognition and Cost of Goods Sold

Revenue Recognition

(i) identify the contract(s) with a customer;

(ii) identify the performance obligations in the contract;

(iii) determine the transaction price;

(iv) allocate the transaction price to the performance obligations in the contract; and

(v) recognize revenue when (or as) the entity satisfies a performance obligation.

Cost of Goods Sold

Stock-Based Compensation

Stock–Based Compensation

Income Taxes

Net Loss per Share

Comprehensive Loss

For the three and nine months ended September 30, 2019 and September 30, 2018, there was no difference between comprehensive loss and the Company’s net loss.

Segment and Geographical Information

Recent Accounting Pronouncements

Recently Adopted Accounting Standards

In February 2016, the FASB issued ASU No. 2016-02, "Leases," that supersedes ASC 840, "Leases." Subsequently, the FASB issued several updates to ASU No. 2016-02, codified in ASC Topic 842 (“ASC 842”). The Company adopted ASC 842 on January 1, 2019 using the modified retrospective method for all leases not substantially completed as of the date of adoption. The Company elected to apply the package of practical expedients, which allowed the Company to not reassess: (i) whether expired or existing contracts contain leases; (ii) lease classification for any expired or existing leases; and (iii) initial direct costs for any existing lease.

Recently Issued Accounting Standards

In June 2016, the FASB issued ASU 2016-13, "Measurement of Credit Losses on Financial Statements." This update provides financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. The update replaces the incurred loss impairment methodology in current U.S. GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. ASU No. 2016-13 is effective for public entities for annual periods beginning after December 15, 2019. The Company is evaluating the impact of adopting this guidance to its consolidated financial statements and related disclosures.

In August 2018, the FASB issued ASU 2018-13, "Fair Value Measurement," which changed the disclosure requirements for fair value measurements by removing, adding and modifying certain disclosures. The standard is effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted. The Company is evaluating the impact of adopting this guidance to its consolidated financial statements and related disclosures.

In August 2018, the FASB issued ASU 2018-15, "Cloud Computing Arrangements," which aligns the requirements for capitalizing implementation costs in a Cloud Computing Arrangement service contract with the requirements for capitalizing implementation costs incurred for an internal-use software license. The standard is effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted. The Company is evaluating the impact of adopting this guidance to its consolidated financial statements and related disclosures.

Summary of Significant Accounting Policies (Tables)

9 Months Ended

Sep. 30, 2019

Accounting Policies [Abstract]

Schedule of ASC 842 Impact of Adoption on Condensed Consolidated Balance Sheet

In accordance with ASC 842, the disclosure impact of adoption on the condensed consolidated balance sheet were as follows (in thousands):


Balance Sheet:	Balance at December 31, 2018		Adjustments Due to ASC 842		Balance at January 1, 2019
Other non-current assets	$	—	$	3,982	$	3,982
Accrued liabilities	139		582		721
Other liabilities	1,069		3,400		4,469

Net Loss Per Share Determination

Net loss per share was determined as follows (in thousands, except share and per share data):


	Three Months Ended September 30,						Nine Months Ended September 30,
	2019		2018		2019		2018
Net loss	$	(8,007)	$	(8,952)	$	(44,124)	$	(22,010)
Weighted average common stock outstanding used to compute net loss per share, basic and diluted	30,764,354		1,054,794		20,249,580		911,873
Net loss per share, basic and diluted	$	(0.26)	$	(8.49)	$	(2.18)	$	(24.14)

Schedule of Potentially Dilutive Securities Outstanding Excluded from Diluted Weighted Average Shares Outstanding


	September 30,
	2019	2018
Redeemable convertible preferred stock outstanding	—	21,233,190
Redeemable convertible preferred stock warrants outstanding	—	2,672,502
Common stock options	4,677,878	4,292,056
Common stock warrants outstanding	—	7,527
	4,677,878	28,205,275

Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2019

Fair Value Disclosures [Abstract]

Option Pricing Model Assumptions

Additionally, the model's inputs reflect assumptions that market participants would use in pricing the instrument in a current period transaction and included:


						December 31,
						2018
Time to liquidity (years)						0.57
Expected volatility						62.5%
Discounted cash flow rate						12.0%
Risk-free interest rate						2.6%
Marketability discount rate						14%

Financial Liabilities Measure on a Recurring Basis


	December 31, 2018
	Level 1		Level 2		Level 3		Total
Liabilities
Redeemable convertible warrant liability	$	—	$	—	$	16,091	$	16,091

Changes in the Redeemable Convertible Warrant Liability

The changes in the redeemable convertible warrant liability are summarized below (in thousands):


Fair Value at December 31, 2018	$	16,091
Change in fair value recorded in other income (expense), net	21,030
Reclassification upon IPO	(37,121)
Fair Value at September 30, 2019	$	—

Balance Sheet Components (Tables)

9 Months Ended

Sep. 30, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of Inventories

Components of inventories were as follows:


(in thousands)	September 30,		December 31,
	2019		2018
Raw materials	$	1,029	$	1,054

Finished products	8,246		4,690
Total	$	9,275	$	5,744

Schedule of Accrued Liabilities

Accrued liabilities consist of the following:


(in thousands)	September 30,		December 31,
	2019		2018
Accrued payroll and related expenses	$	6,984	$	5,157
Accrued professional services	841		1,014
Operating lease liability	749		—
Accrued royalty expense	423		313
Deferred revenue	335		137
Accrued travel expenses	394		270
Accrued clinical expenses	197		244
Accrued other expenses	553		451
Total	$	10,476	$	7,586

Long-term Debt (Tables)

9 Months Ended

Sep. 30, 2019

Debt Disclosure [Abstract]

Future Maturities Under the Term Loan Agreement

Future maturities under the term loan agreement as of September 30, 2019 are as follows (in thousands):


Period Ending December 31:	Amount
2019	$	1,120
2020	4,454
2021	4,442
2022	48,256
	58,272
Add: Accretion of closing fees	1,122
	59,394
Less: Amount representing interest	(14,458)
Less: Amount representing debt discount and debt issuance costs	(151)
Present value of minimum payments	$	44,785

Commitments and Contingencies (Tables)

9 Months Ended

Sep. 30, 2019

Commitments and Contingencies Disclosure [Abstract]

Balance Sheet Information

Balance sheet information as of September 30, 2019 consists of the following (in thousands):


Operating Lease:	September 30, 2019
Operating lease right-of-use asset in other non-current assets	$	3,543
Operating lease liability in accrued liabilities	$	749
Operating lease liability in other liabilities	3,901
Total operating lease liabilities	$	4,650

Operating Lease Maturities

The following table summarizes the Company’s operating lease maturities as of September 30, 2019 (in thousands):


Period Ending December 31:	Amount
2019	$	255
2020	1,037
2021	1,066
2022	1,096
2023	1,127
2024	904
Total lease payments	5,485
Less: imputed interest	(835)
Present value of lease liabilities	$	4,650

Minimum Future Lease Payment Previously Disclosed Under ASC 840


Year Ending December 31:	Total Minimum Lease Payments
2019	$	1,002
2020	1,002
2021	1,031
2022	1,044
2023	1,920
	$	5,999

Redeemable Convertible Preferred Stock (Tables)

9 Months Ended

Sep. 30, 2019

Temporary Equity Disclosure [Abstract]

Redeemable Convertible Preferred Stock Issued and Outstanding

The Company had the following redeemable convertible preferred stock issued and outstanding at December 31, 2018:


	December 31, 2018
	Shares Authorized	Shares Issued and Outstanding	Per share Preference		Preferential Liquidation Value (in thousands)		Carrying Value (in thousands)
Series
Series A	1,629,629	1,629,626	$	2.70	$	4,400	$	4,369
Series A-1	1,111,111	1,111,109	$	3.38	3,755		3,723
Series B	6,264,470	6,264,463	$	6.11	38,276		38,014
Series C	15,064,405	12,227,992	$	6.11	74,713		59,129
	24,069,615	21,233,190			$	121,144	$	105,235

Stock Option Plans (Tables)

9 Months Ended

Sep. 30, 2019

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Activity Under Stock Option Plans

Activity under the Company’s 2007 Stock Option Plan, NeuroCo 2015 Equity Incentive Plan and 2019 Plan is set forth below:


		Options Outstanding
	Shares Available for Grant	Number of Shares	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (in Years)	Aggregate Intrinsic Value (in thousands)





Balances, December 31, 2018	57,889	4,364,377	$	3.79	7.36	$	33,132
Authorized	2,317,000
Options granted	(792,673)	792,673	$	21.82
Options exercised	—	(456,147)	$	1.77
Options cancelled	23,025	(23,025)	$	6.73
Balances, September 30, 2019	1,605,241	4,677,878	$	7.03	7.27	$	120,092
Vested and exercisable at September 30, 2019		2,701,774	$	3.53	6.25	$	78,404
Vested and expected to vest at September 30, 2019		4,677,878	$	7.03	7.27	$	120,092

Assumptions Used for Estimating Fair Value of Employee Stock Options

The fair value of employee and nonemployee stock options was estimated using the following assumptions for the three and nine months ended September 30, 2019 and 2018:


	Three Months Ended September 30,			Nine Months Ended September 30,
	2019	2018	2019	2018
Expected term (in years)	6.25	6.25	5.00 - 6.25	5.00 - 6.25
Expected volatility	42.4%	38.3%	42.4% - 42.9%	38.0% - 38.3%
Risk-free interest rate	1.47%	2.90-2.98%	1.47% - 2.54%	2.68% - 2.98%
Dividend yield	—%	—%	—%	—%

Schedule of Fair Value Assumptions


	Three Months Ended September 30,	Nine Months Ended September 30,
	2019	2019
Expected term (in years)	0.63	0.63
Expected volatility	47.8%	47.8%
Risk-free interest rate	2.45%	2.45%
Dividend yield	—%	—%

Stock-Based Compensation Expense Relating to Stock Options to Employees and Nonemployees

Total stock-based compensation expense recognized during the three and nine months ended September 30, 2019 and 2018, is as follows (in thousands):


	Three Months Ended September 30,						Nine Months Ended September 30,
	2019		2018		2019		2018
Cost of goods sold	$	61	$	12	$	129	$	36
Research and development expenses	134		30		288		220
Selling, general and administrative expenses	730		152		1,606		429
	$	925	$	194	$	2,023	$	685

Formation and Business of the Company (Details) $ / shares in Units, $ in Thousands		1 Months Ended		3 Months Ended
	Mar. 13, 2019	Aug. 31, 2019 $ / shares shares	Apr. 30, 2019 USD ($) $ / shares shares	Sep. 30, 2019 USD ($) $ / shares
Subsequent Event [Line Items]
Reverse stock split	0.3704
Payments of stock issuance costs				$ 2,561
IPO
Subsequent Event [Line Items]
Number of shares issued in transaction (in shares) \| shares			6,000,000
Stock issued, price per share (in USD per share) \| $ / shares			$ 20.00	$ 20.00
Proceeds from stock issued, net of issuance costs			$ 109,119
IPO - Underwriting Discounts and Commissions
Subsequent Event [Line Items]
Payments of stock issuance costs			8,400
IPO - Other Expenses
Subsequent Event [Line Items]
Payments of stock issuance costs			$ 2,481
Second Public Offering
Subsequent Event [Line Items]
Number of shares issued in transaction (in shares) \| shares		4,200,000
Stock issued, price per share (in USD per share) \| $ / shares		$ 39.50
Over-Allotment Option
Subsequent Event [Line Items]
Number of shares issued in transaction (in shares) \| shares		630,000

Summary of Significant Accounting Policies - Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
Accounting Policies [Abstract]
Restricted cash	$ 310	$ 310

Summary of Significant Accounting Policies - Deferred Initial Public Offering Costs (Details) - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
Accounting Policies [Abstract]
Deferred initial public offering costs	$ 0	$ 950

Summary of Significant Accounting Policies - Leases (Details) - USD ($) $ in Thousands	Sep. 30, 2019	Jan. 01, 2019
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Operating lease right-of-use asset	$ 3,543
Operating lease liabilities	$ 4,650
Adjustments Due to ASC 842
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Operating lease right-of-use asset		$ 3,982
Operating lease liabilities		$ 5,190

Summary of Significant Accounting Policies - ASC 842 Impact on Condensed Consolidated Balance Sheet (Details) - USD ($) $ in Thousands	Sep. 30, 2019	Jan. 01, 2019	Dec. 31, 2018
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Other non-current assets	$ 3,575	$ 3,982	$ 1,029
Accrued liabilities	10,476	721	7,586
Other liabilities	$ 3,900	4,469	1,069
Previously Reported
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Other non-current assets			0
Accrued liabilities			139
Other liabilities			$ 1,069
Restatement Adjustment \| Adjustments Due to ASC 842
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Other non-current assets		3,982
Accrued liabilities		582
Other liabilities		$ 3,400

Summary of Significant Accounting Policies - Redeemable Convertible Preferred Stock (Details) - USD ($) $ in Thousands	3 Months Ended	5 Months Ended
	Jun. 30, 2019	Sep. 30, 2019
Class of Stock [Line Items]
Conversion of preferred stock to common stock upon IPO	$ 144,140	$ 144,140
Common Stock
Class of Stock [Line Items]
Conversion of preferred stock to common stock upon IPO (in shares)		23,178,555

Summary of Significant Accounting Policies - Revenue Recognition (Details) - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
Accounting Policies [Abstract]
Unbilled receivables	$ 149	$ 128

Summary of Significant Accounting Policies - Schedule of Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Accounting Policies [Abstract]
Net loss	$ (8,007)	$ (8,952)	$ (44,124)	$ (22,010)
Weighted average common stock outstanding used to compute net loss per share, basic and diluted (in shares)	30,764,354	1,054,794	20,249,580	911,873
Net loss per share, basic and diluted (in USD per share)	$ (0.26)	$ (8.49)	$ (2.18)	$ (24.14)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References + Details

Summary of Significant Accounting Policies - Schedule of Potentially Dilutive Securities Not Included in Calculation of Earnings per Share (Details) - shares	9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	4,677,878	28,205,275
Redeemable convertible preferred stock outstanding
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	0	21,233,190
Redeemable convertible preferred stock warrants outstanding
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	0	2,672,502
Common stock options
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	4,677,878	4,292,056
Common stock warrants outstanding
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share (in shares)	0	7,527

Summary of Significant Accounting Policies - Segment and Geographical Information (Details)	9 Months Ended
	Sep. 30, 2019 segment
Accounting Policies [Abstract]
Number of operating segments	1
Number of reportable segments	1

Fair Value Measurements - Narrative (Details) - USD ($)	Sep. 30, 2019	Dec. 31, 2018	Apr. 30, 2016
Recurring
Class of Stock [Line Items]
Redeemable convertible warrant liability	$ 0	$ 16,091,000
Preferred Stock Warrants
Class of Stock [Line Items]
Temporary equity, shares issued (in shares)			2,672,502
Warrant exercise price (in USD per share)			$ 6.11

Fair Value Measurements - Fair Value Assumptions (Details) - Recurring - Level 3	Dec. 31, 2018
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Time to liquidity (years)	6 months 25 days
Expected volatility
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Measurement input	0.625
Discounted cash flow rate
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Measurement input	0.120
Risk-free interest rate
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Measurement input	0.026
Marketability discount rate
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Measurement input	0.14

Fair Value Measurements - Measurement of Financial Liabilities (Details) - Recurring - USD ($)	Sep. 30, 2019	Dec. 31, 2018
Liabilities
Redeemable convertible warrant liability	$ 0	$ 16,091,000
Level 1
Liabilities
Redeemable convertible warrant liability		0
Level 2
Liabilities
Redeemable convertible warrant liability		0
Level 3
Liabilities
Redeemable convertible warrant liability		$ 16,091,000

Fair Value Measurements - Changes in Redeemable Convertible Warrant Liability (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2019 USD ($)
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Beginning balance	$ 16,091
Change in fair value recorded in other income (expense), net	21,030
Reclassification upon IPO	(37,121)
Ending balance	$ 0

Balance Sheet Components - Schedule of Inventory (Details) - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Raw materials	$ 1,029	$ 1,054
Finished products	8,246	4,690
Total	$ 9,275	$ 5,744

Balance Sheet Components - Narrative (Details) - USD ($)	Sep. 30, 2019	Dec. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Work-in-process	$ 0	$ 0

Balance Sheet Components - Accrued Liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2019	Jan. 01, 2019	Dec. 31, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Accrued payroll and related expenses	$ 6,984		$ 5,157
Accrued professional services	841		1,014
Operating lease liability	749
Accrued royalty expense	423		313
Deferred revenue	335		137
Accrued travel expenses	394		270
Accrued clinical expenses	197		244
Accrued other expenses	553		451
Total	$ 10,476	$ 721	$ 7,586

Long-term Debt - Term Loan Narrative (Details) - USD ($)	9 Months Ended	12 Months Ended
	Sep. 30, 2019	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	May 01, 2019	Sep. 30, 2018	Apr. 30, 2017	Oct. 31, 2015
Debt Instrument [Line Items]
Term loan agreement amount								$ 15,000,000
Debt drawn down	$ 59,394,000
Minimum liquidity amount	$ 3,000,000
Minimum net revenue target				$ 15,000,000	$ 5,000,000	$ 1,000,000
Equity cure period	90 days
Long-term debt	$ 44,785,000
Scenario, Forecast
Debt Instrument [Line Items]
Minimum net revenue target		$ 40,000,000	$ 30,000,000
Term Loan
Debt Instrument [Line Items]
Term loan agreement amount								$ 25,000,000		$ 30,000,000
Stated interest rate							10.00%	1075.00%
Interest rate paid-in-kind							2.00%	275.00%
Interest rate paid in cash							8.00%	800.00%
Term Loan, Tranche A
Debt Instrument [Line Items]
Term loan agreement amount										$ 20,000,000
Financing fee										175.00%
Facility fee										500.00%
Term Loan, Tranche B
Debt Instrument [Line Items]
Term loan agreement amount										$ 10,000,000
Debt drawn down									$ 5,000,000

Long-term Debt - Future Maturities Under the Term Loan (Details) $ in Thousands	Sep. 30, 2019 USD ($)
Debt Disclosure [Abstract]
2019	$ 1,120
2020	4,454
2021	4,442
2022	48,256
Long-term debt, gross before accretion of closing fees	58,272
Add: Accretion of closing fees	1,122
Long-term debt, gross	59,394
Less: Amount representing interest	(14,458)
Less: Amount representing debt discount and debt issuance costs	(151)
Present value of minimum payments	$ 44,785

Long-term Debt - Series C Narrative (Details) - $ / shares	1 Months Ended
	Apr. 30, 2019	Jul. 31, 2017	Oct. 31, 2015	Sep. 30, 2019	Dec. 31, 2018	Apr. 30, 2016
IPO
Class of Stock [Line Items]
Temporary equity, shares issued (in shares)	6,000,000
Stock issued, price per share (in USD per share)	$ 20.00			$ 20.00
Preferred Stock Warrants
Class of Stock [Line Items]
Warrants outstanding (in shares)			163,877	0	2,672,502
Warrant exercise price (in USD per share)						$ 6.11
Series C
Class of Stock [Line Items]
Temporary equity, shares issued (in shares)		163,877	327,759
Stock issued, price per share (in USD per share)		$ 6.11	$ 6.11

Commitments and Contingencies - Lease Narrative (Details) $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2019 USD ($)	Sep. 30, 2019 USD ($)
Commitments and Contingencies Disclosure [Abstract]
Operating lease costs	$ 217	$ 652,000
Operating lease liabilities	$ 178	$ 540,000
Weighted average discount rate	6.50%	6.50%
Weighted average remaining lease term	5 years 29 days	5 years 29 days

Commitments and Contingencies - Balance Sheet Information (Details) $ in Thousands	Sep. 30, 2019 USD ($)
Commitments and Contingencies Disclosure [Abstract]
Operating lease right-of-use asset in other non-current assets	$ 3,543
Operating lease liability in accrued liabilities	749
Operating lease liability in other liabilities	3,901
Total operating lease liabilities	$ 4,650

Commitments and Contingencies - Operating Lease Maturities (Details) $ in Thousands	Sep. 30, 2019 USD ($)
Commitments and Contingencies Disclosure [Abstract]
2019	$ 255
2020	1,037
2021	1,066
2022	1,096
2023	1,127
2024 and Thereafter	904
Total lease payments	5,485
Less: imputed interest	(835)
Present value of lease liabilities	$ 4,650

Commitments and Contingencies - Topic 840 Aggregate Future Minimum Lease Payments (Details) $ in Thousands	Dec. 31, 2018 USD ($)
Commitments and Contingencies Disclosure [Abstract]
2019	$ 1,002
2020	1,002
2021	1,031
2022	1,044
2023	1,920
Total Minimum Lease Payments	$ 5,999

Commitments and Contingencies - Purchase Obligation Narrative (Details) $ in Thousands	Sep. 30, 2019 USD ($)
Commitments and Contingencies Disclosure [Abstract]
Purchase obligation	$ 3,715

Redeemable Convertible Preferred Stock - Schedule of Redeemable Convertible Preferred Stock (Details) - USD ($) $ / shares in Units, $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
Temporary Equity [Line Items]
Shares Authorized (in shares)	0	24,069,615
Shares Issued (in shares)	0	21,233,190
Shares Outstanding (in shares)	0	21,233,190
Preferential Liquidation Value (in thousands)	$ 0	$ 121,144
Carrying Value (in thousands)	$ 0	$ 105,235
Series A
Temporary Equity [Line Items]
Shares Authorized (in shares)		1,629,629
Shares Issued (in shares)		1,629,626
Shares Outstanding (in shares)		1,629,626
Per share Preference (in USD per share)		$ 2.70
Preferential Liquidation Value (in thousands)		$ 4,400
Carrying Value (in thousands)		$ 4,369
Series A-1
Temporary Equity [Line Items]
Shares Authorized (in shares)		1,111,111
Shares Issued (in shares)		1,111,109
Shares Outstanding (in shares)		1,111,109
Per share Preference (in USD per share)		$ 3.38
Preferential Liquidation Value (in thousands)		$ 3,755
Carrying Value (in thousands)		$ 3,723
Series B
Temporary Equity [Line Items]
Shares Authorized (in shares)		6,264,470
Shares Issued (in shares)		6,264,463
Shares Outstanding (in shares)		6,264,463
Per share Preference (in USD per share)		$ 6.11
Preferential Liquidation Value (in thousands)		$ 38,276
Carrying Value (in thousands)		$ 38,014
Series C
Temporary Equity [Line Items]
Shares Authorized (in shares)		15,064,405
Shares Issued (in shares)		12,227,992
Shares Outstanding (in shares)		12,227,992
Per share Preference (in USD per share)		$ 6.11
Preferential Liquidation Value (in thousands)		$ 74,713
Carrying Value (in thousands)		$ 59,129

Redeemable Convertible Preferred Stock - Narrative (Details) - $ / shares	9 Months Ended
	Sep. 30, 2019	Apr. 30, 2019	Dec. 31, 2018	Oct. 31, 2015
Temporary Equity [Line Items]
Temporary equity, shares issued (in shares)	0		21,233,190
Temporary equity, shares outstanding (in shares)	0		21,233,190
Preferred Stock Warrants
Temporary Equity [Line Items]
Warrants outstanding (in shares)	0		2,672,502	163,877
IPO
Temporary Equity [Line Items]
Stock issued, price per share (in USD per share)	$ 20.00	$ 20.00
IPO \| Preferred Stock Warrants
Temporary Equity [Line Items]
Shares converted (in shares)	1,945,365
Convertible Preferred Stock
Temporary Equity [Line Items]
Temporary equity, shares issued (in shares)	0
Temporary equity, shares outstanding (in shares)	0

Stockholders Equity (Deficit) - Narrative (Details)	9 Months Ended
Stockholders Equity (Deficit) - Narrative (Details)	Sep. 30, 2019 USD ($) vote $ / shares shares	Apr. 30, 2019 $ / shares	Dec. 31, 2018 $ / shares shares
Class of Warrant or Right [Line Items]
Preferred stock authorized (in shares)	5,000,000		0
Preferred stock par value (in USD per share) \| $ / shares	$ 0.001		$ 0.001
Preferred stock issued (in shares)	0		0
Preferred stock outstanding (in shares)	0		0
Shares authorized (in shares)	100,000,000		29,879,220
Par value (in USD per share) \| $ / shares	$ 0.001		$ 0.001
Shares issued (in shares)	30,775,980		1,135,310
Shares outstanding (in shares)	30,775,980		1,135,310
Dividends declared \| $	$ 0
Number of votes entitled per share of common stock \| vote	1
Warrants to Purchase Common Stock
Class of Warrant or Right [Line Items]
Warrants outstanding (in shares)	0		7,527
IPO
Class of Warrant or Right [Line Items]
Stock issued, price per share (in USD per share) \| $ / shares	$ 20.00	$ 20.00
IPO \| Common Stock Warrant
Class of Warrant or Right [Line Items]
Shares converted (in shares)	5,968

Stock Option Plans - Narrative (Details) - USD ($) $ in Thousands	1 Months Ended	9 Months Ended
	Mar. 31, 2019	Sep. 30, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Aggregate intrinsic value of options exercised		$ 10,846
Compensation expensed not yet recognized		$ 8,493
Compensation expensed not yet recognized, period for recognition		3 years 1 month 28 days
ISO
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Exercise threshold as a percentage of fair value of shares		10000.00%
NSO
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Exercise threshold as a percentage of fair value of shares		8500.00%
ISO and NSO
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Option term		10 years
Option vesting term		4 years
ISO and NSO \| 10% Stockholders
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Exercise threshold as a percentage of fair value of shares		11000.00%
Common stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of additional shares allowable under the plan (in shares)	1,200,000
Percent of outstanding shares of common stock	1.00%
Common stock reserved for future issuance (in shares)	434,000
Percent of purchase of price of common stock	85.00%
2019 Stock Option Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares of common stock reserved for issuance (in shares)	2,317,000	2,362,933
Percent of outstanding shares of common stock		4.00%
2019 Stock Option Plan \| Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of additional shares allowable under the plan (in shares)		3,000,000

Stock Option Plans - Activity Under Compensation Plan (Details) $ / shares in Units, $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2019 USD ($) $ / shares shares	Dec. 31, 2018 USD ($) $ / shares shares
Shares Available for Grant
Beginning balance (in shares)	57,889
Authorized (in shares)	2,317,000
Options granted (in shares)	792,673
Options cancelled (in shares)	23,025
Ending balance (in shares)	1,605,241	57,889
Number of Shares
Beginning balance (in shares)	4,364,377
Options granted (in shares)	792,673
Options exercised (in shares)	(456,147)
Options cancelled (in shares)	(23,025)
Ending balance (in shares)	4,677,878	4,364,377
Weighted Average Exercise Price
Beginning balance (in USD per share) \| $ / shares	$ 3.79
Options granted (in USD per share) \| $ / shares	21.82
Options exercised (in USD per share) \| $ / shares	1.77
Options cancelled (in USD per share) \| $ / shares	6.73
Ending balance (in USD per share) \| $ / shares	$ 7.03	$ 3.79
Weighted Average Remaining Contractual Term (in Years), awards outstanding	7 years 3 months 7 days	7 years 4 months 9 days
Aggregate Intrinsic Value, awards outstanding \| $	$ 120,092	$ 33,132
Number of Shares, vested and exercisable (in shares)	2,701,774
Weighted Average Exercise Price, vested and exercisable (in USD per share) \| $ / shares	$ 3.53
Weighted Average Remaining Contractual Term (in Years), vested and exercisable	6 years 3 months
Aggregate Intrinsic Value, vested and exercisable \| $	$ 78,404
Number of Shares, vested and expect to vest (in shares)	4,677,878
Weighted Average Exercise Price, vested and expected to vest (in USD per share) \| $ / shares	$ 7.03
Weighted Average Remaining Contractual Term (in Years), vested and expected to vest	7 years 3 months 7 days
Aggregate Intrinsic Value, vested and expected to vest \| $	$ 120,092

Stock Option Plans - Fair Value of Stock Options (Details) - Common stock options	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (in years)	6 years 3 months	6 years 3 months
Expected volatility	42.40%	38.30%
Expected volatility, minimum			42.40%	38.00%
Expected volatility, maximum			42.90%	38.30%
Risk-free interest rate	1.47%
Risk-free interest rate, minimum		2.90%	1.47%	2.68%
Risk-free interest rate, maximum		2.98%	2.54%	2.98%
Dividend yield	0.00%	0.00%	0.00%	0.00%
2019 Stock Option Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (in years)	7 months 17 days		7 months 17 days
Expected volatility	47.80%		47.80%
Risk-free interest rate	2.45%		2.45%
Dividend yield	0.00%		0.00%
Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (in years)			5 years	5 years
Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (in years)			6 years 3 months	6 years 3 months

Stock Option Plans - Stock-based Compensation (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock-based compensation expense	$ 925	$ 194	$ 2,023	$ 685
Cost of goods sold
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock-based compensation expense	61	12	129	36
Research and development expenses
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock-based compensation expense	134	30	288	220
Selling, general and administrative expenses
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Stock-based compensation expense	$ 730	$ 152	$ 1,606	$ 429

Label	Element	Value
Accounting Standards Update 2014-09 [Member]
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	$ 87,000
Accounting Standards Update 2014-09 [Member] \| Retained Earnings [Member]
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	87,000
Accounting Standards Update 2016-09 [Member]
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	0
Accounting Standards Update 2016-09 [Member] \| Additional Paid-in Capital [Member]
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	13,000
Accounting Standards Update 2016-09 [Member] \| Retained Earnings [Member]
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	$ (13,000)