View Filing Data

Document and Entity Information - shares	9 Months Ended
Document and Entity Information - shares	Sep. 30, 2019	Oct. 25, 2019
Document Documentand Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Sep. 30, 2019
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q3
Trading Symbol	SPNE
Entity Registrant Name	SeaSpine Holdings Corporation
Entity Central Index Key	0001637761
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Emerging Growth Company	true
Entity Small Business	true
Entity Ex Transition Period	false
Entity Current Reporting Status	Yes
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		19,066,831

CONDENSED COMBINED STATEMENT OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Income Statement [Abstract]
Cost of Goods and Services Sold	$ 14,407	$ 14,247	$ 42,303	$ 40,986
Gross profit	25,481	21,587	73,041	64,432
Selling, general and administrative	30,134	27,041	85,050	76,940
Research and development	3,896	3,203	10,995	8,783
Intangible amortization	792	792	2,377	2,376
Impairment of Intangible Assets, Finite-lived	0	0	4,993	0
Total operating expenses	34,822	31,036	103,415	88,099
Operating loss	(9,341)	(9,449)	(30,374)	(23,667)
Other expense, net	(97)	(190)	(49)	(327)
Loss before income taxes	(9,438)	(9,639)	(30,423)	(23,994)
Provision (benefit) for income taxes	225	(107)	265	4
Net loss	$ (9,663)	$ (9,532)	$ (30,688)	$ (23,998)
Net loss per share, basic and diluted	$ (0.51)	$ (0.65)	$ (1.62)	$ (1.66)
Weighted average shares used to compute basic and diluted net loss per share	19,051	14,750	18,947	14,477
Revenues	$ 39,888	$ 35,834	$ 115,344	$ 105,418

CONDENSED COMBINED STATEMENTS OF COMPREHENSIVE LOSS Statement - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2019	Sep. 30, 2018	Sep. 30, 2019	Sep. 30, 2018
Statement of Comprehensive Income [Abstract]
Net loss	$ (9,663)	$ (9,532)	$ (30,688)	$ (23,998)
Foreign currency translation adjustments	(327)	(57)	(388)	(238)
Debt Securities, Available-for-sale, Unrealized Gain (Loss)	(9)	0	5	0
Comprehensive loss	$ (9,999)	$ (9,589)	$ (31,071)	$ (24,236)

- Definition

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

+ References + Details

CONDENSED COMBINED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
Current assets:
Cash and cash equivalents	$ 22,314	$ 24,233
Short-term Investments	4,996	29,800
Trade accounts receivable, net of allowances of $188 and $850	23,720	20,335
Inventories, net	48,011	42,742
Prepaid expenses and other current assets	3,723	2,948
Total current assets	102,764	120,058
Property, plant and equipment, net	26,641	22,623
Intangible assets, net	19,412	28,712
Other assets	691	949
Total assets	149,508	172,342
Current liabilities:
Accounts payable, trade	11,559	9,214
Accrued compensation	6,477	7,900
Accrued commissions	7,372	5,451
Contingent consideration liabilities	711	129
Other accrued expenses and current liabilities	5,091	3,852
Total current liabilities	31,210	26,546
Contingent consideration liabilities, net of current portion	1,116	2,367
Other liabilities	1,430	1,344
Total liabilities	33,756	30,257
Commitments and contingencies
Stockholders' equity:
Preferred stock, $0.01 par value; 15,000 authorized; no shares issued and outstanding at September 30, 2019 and December 31, 2018	0	0
Common stock, $0.01 par value; 60,000 authorized; 19,060 and 18,669 shares issued and outstanding at September 30, 2019 and December 31, 2018, respectively	191	187
Additional paid-in capital	281,830	277,096
Accumulated other comprehensive income	1,219	1,602
Accumulated deficit	(167,488)	(136,800)
Total stockholders' equity	115,752	142,085
Total liabilities and stockholders' equity	$ 149,508	$ 172,342

CONDENSED COMBINED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2019	Dec. 31, 2018
Statement of Financial Position [Abstract]
Allowance for trade accounts receivable	$ 188	$ 850
Preferred Stock, Par or Stated Value Per Share	$ 0.01	$ 0.01
Preferred Stock, Shares Authorized	15,000,000	15,000,000
Preferred Stock, Shares Outstanding	0	0
Common Stock, Par or Stated Value Per Share	$ 0.01	$ 0.01
Common Stock, Shares Authorized	60,000,000	60,000,000
Common Stock, Shares, Issued	19,036,000	18,669,000
Common Stock, Shares, Outstanding	19,036,000	18,669,000

CONDENSED COMBINED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended				9 Months Ended		12 Months Ended
	Sep. 30, 2019	Mar. 31, 2019	Sep. 30, 2018	Mar. 31, 2018	Sep. 30, 2019	Sep. 30, 2018	Dec. 31, 2018
Interest Paid, Excluding Capitalized Interest, Operating Activities					$ 115	$ 109
OPERATING ACTIVITIES:
Net loss	$ (9,663)	$ (8,989)	$ (9,532)	$ (7,105)	(30,688)	(23,998)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization					7,929	7,950
Instrument replacement expense	600		300		1,632	1,269
Impairment of Intangible Assets, Finite-lived	0		0		4,993	0
Provision for excess and obsolete inventories					2,358	2,940
Amortization of debt issuance costs					57	94
Deferred income tax provision					176	36
Stock-based compensation					5,907	3,449
Gain from change in fair value of contingent consideration liabilities					(571)	(893)
Changes in assets and liabilities:
Accounts receivable					(3,531)	1,069
Inventories					(6,413)	(3,446)
Prepaid expenses and other current assets					(236)	(622)
Other non-current assets					(2)	(218)
Accounts payable					2,117	3,763
Accrued commissions					1,918	(1,032)
Other accrued expenses and current liabilities					(1,013)	898
Other non-current liabilities					237	140
Net cash used in operating activities					(15,130)	(8,601)
INVESTING ACTIVITIES:
Purchases of property and equipment					(10,337)	(6,565)
Proceeds from Sale and Maturity of Debt Securities, Available-for-sale					25,000	0
Net cash provided by (used in) investing activities					14,663	(6,565)
FINANCING ACTIVITIES:
Proceeds from issuance of common stock, net of offering costs- ATM transactions					0	8,514
Proceeds from Issuance of Shares under Incentive and Share-based Compensation Plans, Including Stock Options					671	546
Proceeds from exercise of stock options					230	886
Repurchases of common stock for income tax withheld upon vesting of restricted stock awards and restricted stock units					(2,070)	(600)
Payment of contingent consideration liabilities in connection with acquisition of business					(98)	(113)
Net cash (used in) provided by financing activities					(1,267)	16,233
Proceeds from Lines of Credit					0	7,000
Effect of exchange rate changes on cash and cash equivalents					(185)	(73)
Net change in cash and cash equivalents					(1,919)	994
Cash and cash equivalents at beginning of period		$ 24,233		$ 10,788	24,233	10,788	$ 10,788
Cash and cash equivalents at end of period	$ 22,314		$ 11,782		22,314	11,782	$ 24,233
Supplemental Cash Flow Information [Abstract]
Income Taxes Paid, Net					98	126
Non-cash investing activities:
Property and equipment in liabilities					$ 1,358	$ 538

CONDENSED COMBINED STATEMENT OF EQUITY Statement - USD ($) $ in Thousands	Total	Common Stock [Member]	Additional Paid-in Capital [Member]	Accumulated Other Comprehensive Income (Loss) [Member]	Retained Earnings [Member]	ATM offering [Member]	Restricted Stock Units (RSUs) [Member]
Beginning Balance, Shares, Outstanding at Dec. 31, 2017		13,508,000
Beginning Balance at Dec. 31, 2017	$ 105,653	$ 135	$ 206,844	$ 1,950	$ (103,276)
Net loss	(7,105)				(7,105)
Foreign currency translation adjustment	240			240
Restricted stock issued		147,000
Restricted stock issued	2	$ 2	0
Issuance of common stock, net of offering costs- ATM transactions		882,000
Issuance of common stock, net of offering costs- ATM transactions	8,514	$ 9	8,505
Repurchases of common stock for income tax withheld upon vesting of restricted stock awards and restricted stock units		(2,000)
Repurchases of common stock for income tax withheld upon vesting of restricted stock awards and restricted stock units	(514)		(514)
Stock-based compensation	835		835
Ending Balance, Shares, Outstanding at Mar. 31, 2018		14,535,000
Ending Balance at Mar. 31, 2018	107,625	$ 146	215,670	2,190	(110,381)
Proceeds from Issuance of Common Stock	8,514					$ 8,500
Beginning Balance, Shares, Outstanding at Dec. 31, 2017		13,508,000
Beginning Balance at Dec. 31, 2017	105,653	$ 135	206,844	1,950	(103,276)
Net loss	(23,998)
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Gain (Loss) Arising During Period, Net of Tax	(238)
Debt Securities, Available-for-sale, Unrealized Gain (Loss)	0
Restricted stock issued							554,600
Issuance of common stock, net of offering costs- ATM transactions						882,332
Ending Balance, Shares, Outstanding at Sep. 30, 2018		14,792,000
Ending Balance at Sep. 30, 2018	94,214	$ 148	219,628	1,712	(127,274)
Beginning Balance, Shares, Outstanding at Dec. 31, 2017		13,508,000
Beginning Balance at Dec. 31, 2017	$ 105,653	$ 135	206,844	1,950	(103,276)
Ending Balance, Shares, Outstanding at Dec. 31, 2018	18,669,000	18,669,000
Ending Balance at Dec. 31, 2018	$ 142,085	$ 187	277,096	1,602	(136,800)
Beginning Balance, Shares, Outstanding at Mar. 31, 2018		14,535,000
Beginning Balance at Mar. 31, 2018	107,625	$ 146	215,670	2,190	(110,381)
Net loss	(7,361)				(7,361)
Foreign currency translation adjustment	(421)			(421)
Restricted stock issued		99,000
Restricted stock issued	0	$ 0	0
Stock Issued During Period, Shares, Employee Stock Purchase Plans		81,000
Stock Issued During Period, Value, Employee Stock Purchase Plan	546	$ 1	545
Issuance of common stock- exercise of stock options		20,000
Issuance of common stock- exercise of stock options	250		250
Repurchases of common stock for income tax withheld upon vesting of restricted stock awards and restricted stock units		0
Repurchases of common stock for income tax withheld upon vesting of restricted stock awards and restricted stock units	(20)		(20)
Stock-based compensation	943		943
Ending Balance, Shares, Outstanding at Jun. 30, 2018		14,735,000
Ending Balance at Jun. 30, 2018	101,562	$ 147	217,388	1,769	(117,742)
Net loss	(9,532)				(9,532)
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Gain (Loss) Arising During Period, Net of Tax	(57)
Foreign currency translation adjustment	(57)			(57)
Debt Securities, Available-for-sale, Unrealized Gain (Loss)	0
Restricted stock issued		10,000					67,319
Restricted stock issued	1	$ 1	0
Issuance of common stock- exercise of stock options		47,000
Issuance of common stock- exercise of stock options	636		636
Repurchases of common stock for income tax withheld upon vesting of restricted stock awards and restricted stock units		0
Repurchases of common stock for income tax withheld upon vesting of restricted stock awards and restricted stock units	(67)		(67)
Stock-based compensation	1,671		1,671
Ending Balance, Shares, Outstanding at Sep. 30, 2018		14,792,000
Ending Balance at Sep. 30, 2018	$ 94,214	$ 148	219,628	1,712	(127,274)
Beginning Balance, Shares, Outstanding at Dec. 31, 2018	18,669,000	18,669,000
Beginning Balance at Dec. 31, 2018	$ 142,085	$ 187	277,096	1,602	(136,800)
Net loss	(8,989)				(8,989)
Foreign currency translation adjustment	(169)			(169)
Debt Securities, Available-for-sale, Unrealized Gain (Loss)	11
Restricted stock issued		216,000
Restricted stock issued	2	$ 2
Issuance of common stock- exercise of stock options		11,000
Issuance of common stock- exercise of stock options	143	$ 0	143
Repurchases of common stock for income tax withheld upon vesting of restricted stock awards and restricted stock units	(1,851)		(1,851)
Stock-based compensation	1,947		1,947
Ending Balance, Shares, Outstanding at Mar. 31, 2019		18,896,000
Ending Balance at Mar. 31, 2019	133,179	$ 189	277,335	1,444	(145,789)
Proceeds from Issuance of Common Stock	$ 0
Beginning Balance, Shares, Outstanding at Dec. 31, 2018	18,669,000	18,669,000
Beginning Balance at Dec. 31, 2018	$ 142,085	$ 187	277,096	1,602	(136,800)
Net loss	(30,688)
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Gain (Loss) Arising During Period, Net of Tax	(388)
Debt Securities, Available-for-sale, Unrealized Gain (Loss)	$ 5
Restricted stock issued							252,710
Ending Balance, Shares, Outstanding at Sep. 30, 2019	19,036,000	19,060,000
Ending Balance at Sep. 30, 2019	$ 115,752	$ 191	281,830	1,219	(167,488)
Beginning Balance, Shares, Outstanding at Mar. 31, 2019		18,896,000
Beginning Balance at Mar. 31, 2019	133,179	$ 189	277,335	1,444	(145,789)
Net loss	(12,036)				(12,036)
Foreign currency translation adjustment	108			108
Debt Securities, Available-for-sale, Unrealized Gain (Loss)	3
Restricted stock issued		71,000
Restricted stock issued	1	$ 1	0
Stock Issued During Period, Shares, Employee Stock Purchase Plans		64,000
Stock Issued During Period, Value, Employee Stock Purchase Plan	671	$ 1	670
Issuance of common stock- exercise of stock options		5,000
Issuance of common stock- exercise of stock options	76	$ 0	76
Repurchases of common stock for income tax withheld upon vesting of restricted stock awards and restricted stock units		0
Repurchases of common stock for income tax withheld upon vesting of restricted stock awards and restricted stock units	(57)		(57)
Stock-based compensation	1,970		1,970
Ending Balance, Shares, Outstanding at Jun. 30, 2019		19,036,000
Ending Balance at Jun. 30, 2019	123,915	$ 191	279,994	1,555	(157,825)
Net loss	(9,663)				(9,663)
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Gain (Loss) Arising During Period, Net of Tax	(327)
Foreign currency translation adjustment	(327)
Debt Securities, Available-for-sale, Unrealized Gain (Loss)	(9)
Restricted stock issued		23,000					34,100
Restricted stock issued	0
Issuance of common stock- exercise of stock options		1,000
Issuance of common stock- exercise of stock options	10		10
Repurchases of common stock for income tax withheld upon vesting of restricted stock awards and restricted stock units	(164)		(164)
Stock-based compensation	$ 1,990		1,990
Ending Balance, Shares, Outstanding at Sep. 30, 2019	19,036,000	19,060,000
Ending Balance at Sep. 30, 2019	$ 115,752	$ 191	$ 281,830	$ 1,219	$ (167,488)

BUSINESS	9 Months Ended
BUSINESS	Sep. 30, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
BUSINESS	BUSINESS AND BASIS OF PRESENTATION Business SeaSpine Holdings Corporation was incorporated in Delaware on February 12, 2015 in connection with the spin-off of the orthobiologics and spinal implant business of Integra LifeSciences Holdings Corporation, a diversified medical technology company. The spin-off occurred on July 1, 2015. Unless the context indicates otherwise, (i) references to "SeaSpine" or the "Company" refer to SeaSpine Holdings Corporation and its wholly-owned subsidiaries, and (ii) references to "Integra" refer to Integra LifeSciences Holdings Corporation and its subsidiaries other than SeaSpine. Basis of Presentation and Principles of Consolidation The Company prepared the unaudited interim condensed consolidated financial statements included in this report in accordance with accounting principles generally accepted in the U.S. (GAAP) for interim financial information and the rules and regulations of the Securities and Exchange Commission (SEC) related to quarterly reports on Form 10-Q. The Company’s financial statements are presented on a consolidated basis. The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. Intercompany accounts and transactions have been eliminated in consolidation. The unaudited interim condensed consolidated financial statements do not include all information and disclosures required by GAAP for annual audited financial statements and should be read with the Company’s consolidated financial statements and notes thereto for the year ended December 31, 2018 included in the Company’s Annual Report on Form 10-K filed with the SEC. In the opinion of management, the unaudited interim condensed consolidated financial statements included in this report have been prepared on the same basis as the Company's audited consolidated financial statements and include all adjustments (consisting only of normal recurring adjustments) necessary for a fair statement of the financial position, results of operations, cash flows, and statement of equity for periods presented. The results for the three and nine months ended September 30, 2019 are not necessarily indicative of the results expected for the full year. The condensed consolidated balance sheet as of December 31, 2018 was derived from the audited consolidated financial statements for the year ended December 31, 2018. Under current SEC rules, generally, a company qualifies as a "smaller reporting company" if it has a public float of less than $250 million as of the last business day of its second fiscal quarter. If a company qualifies as a smaller reporting company on that date, it may elect to reflect that determination and use the smaller reporting company scaled disclosure accommodations in its subsequent SEC filings until the beginning of the first quarter of the fiscal year following the date it determines it does not qualify as a smaller reporting company. The Company's public float as of the last business day of its second fiscal quarter of 2018 was less than $250 million, and as such, the Company qualifies as a smaller reporting company and is following certain of the scaled disclosure accommodations. The Company measured its public float as of the last business day of its second fiscal quarter of 2019 and determined that it will continue to qualify as a smaller reporting company for its SEC filings made in 2020. Concentration of Risk Integra and PcoMed, LLC (PcoMed) entered into a supply agreement on May 15, 2013 (the "Supply Agreement"), which was subsequently assigned to the Company by Integra on May 21, 2015. For the nine months ending September 30, 2019, the sales of products incorporating the NanoMetalene® technology licensed and supplied to the Company pursuant to the Supply Agreement exceeded 10% of the Company's revenue. Pursuant to the Supply Agreement, PcoMed granted the Company a worldwide exclusive license to sell certain of its products treated with certain proprietary PcoMed technology (Treatment) for use in the spinal interbody and intervertebral market (Treated Products). PcoMed serves as the sole supplier of the Treatment. As consideration for the license and the Treatment, the Company paid to PcoMed initial milestone payments prior to the initial sale and the Company will pay PcoMed a low single digit royalty on the Company’s net sales of all Treated Products. In the event the Company fails to meet any of its payment obligations, the license will, at PcoMed’s option and following a cure period, convert to a non-exclusive license. The Supply Agreement contains customary representations and termination provisions, including for material breach and bankruptcy. Each of the Company and PcoMed retain the rights to their respective intellectual property.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	9 Months Ended
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	Sep. 30, 2019
Accounting Policies [Abstract]
Significant Accounting Policies [Text Block]	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Use of Estimates Preparing consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent liabilities, and the reported amounts of revenues and expenses. Significant estimates affecting amounts reported or disclosed in the consolidated financial statements include allowances for doubtful accounts receivable and sales returns and other credits, net realizable value of inventories, discount rates and estimated projected cash flows used to value and test impairments of identifiable intangible and long-lived assets, assumptions related to the timing and probability of product launch dates, discount rates matched to the estimated timing of payments, probability of success rates and discount adjustments on the related cash flows for contingent considerations in business combinations, depreciation and amortization periods for identifiable intangible and long-lived assets, computation of taxes, valuation allowances recorded against deferred tax assets, the valuation of stock-based compensation and loss contingencies. These estimates are based on historical experience and on various other assumptions believed to be reasonable under the current circumstances. Actual results could differ from these estimates. Recent Accounting Standards Not Yet Adopted The Company qualifies as an “emerging growth company” (EGC) under the Jumpstart Our Business Startups (JOBS) Act and elected to take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act of 1933, as amended, which permits EGCs to defer compliance with new or revised accounting standards (the EGC extension) until non-issuers must comply with such standards. Accordingly, so long as the Company continues to qualify as an EGC, the Company will not have to adopt or comply with new or revised accounting standards until non-issuers must adopt or comply with such standards. In February 2016, the Financial Accounting Standard Board (FASB) issued Accounting Standards Update (ASU or Update) No. 2016-02, Leases (Topic 842). The new standard requires lessees to recognize lease liabilities and corresponding right-of-use assets for all leases with lease terms of greater than twelve months. It also changes the definition of a lease and expands the disclosure requirements of lease arrangements. The new standard must be adopted using the modified retrospective approach. The Company will early adopt the standard beginning on January 1, 2020. The Company expects to apply the transition practical expedients allowed by the standard. In July 2018, the FASB issued Update No. 2018-10, Codification Improvements to Topic 842 (Leases) and Update No. 2018-11, Leases (Topic 842): Targeted Improvements. In March 2019, the FASB issued Update No. 2019-01, Leases (Topic 842): Codification Improvements. The amendments in ASU 2018-10, ASU 2018-11, and ASU 2019-01 provide additional clarification and implementation guidance on certain aspects of the previously issued ASU 2016-02 and have the same effective date and transition requirements as ASU 2016-02. Note 10 to the Condensed Consolidated Financial Statements provides details on the Company’s current lease arrangements. While the Company continues to evaluate the impact of this new standard on its consolidated financial statements, the Company currently expects the primary impact will be to record right-of-use assets and lease liabilities for existing operating leases in the consolidated balance sheets. The Company does not currently expect the adoption of this new standard to have a material impact on its consolidated results of operations or cash flows. In June 2018, the FASB issued Update No. 2018-07, Compensation-Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. This Update will require an entity to apply the requirements of Topic 718 to nonemployee awards except for specific guidance on inputs to an option pricing model and the attribution of cost (that is, the period of time over which share-based payment awards vest and the pattern of cost recognition over that period). The amendments specify that Topic 718 applies to all share-based payment transactions in which a grantor acquires goods or services to be used or consumed in a grantor’s own operations by issuing share-based payment awards. The amendments also clarify that Topic 718 does not apply to share-based payments used to effectively provide (1) financing to the issuer or (2) awards granted in conjunction with selling goods or services to customers as part of a contract accounted for under Topic 606. The new standard will be effective for the Company beginning on January 1, 2020. Early adoption is permitted but no earlier than an entity's adoption date of Topic 606. The Company does not currently expect the adoption of this new standard to have a material impact on its consolidated financial statements. In July 2018, the FASB issued Update No. 2018-09, Codification Improvements. This Update includes several amendments to the FASB Accounting Standards Codification (Codification) intended to clarify, improve, or correct errors in the Codification. Some amendments do not require transition guidance and are effective upon issuance. The amendments requiring transition guidance will be effective for the Company beginning on January 1, 2020. The Company is evaluating the impact of this standard on its consolidated financial statements. In August 2018, the FASB issued Update No. 2018-13, Fair Value Measurement (Topic 820)-Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement. The amendments in this Update modify the disclosure requirements on fair value measurements in Topic 820 based on the concepts in the Concepts Statement including the consideration of costs and benefits. The new standard will be effective for the Company beginning on January 1, 2020. An entity is permitted to early adopt any removed or modified disclosures upon issuance of this Update and delay adoption of the additional disclosures until their effective date. The Company is evaluating the impact of this standard on its consolidated financial statements. In August 2018, the FASB issued Update No. 2018-15, Intangibles-Goodwill and Other-Internal Use Software (Subtopic 350-40). The amendments in this Update align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). The new standard will be effective for the Company beginning on January 1, 2021. Early adoption is permitted. The Company is evaluating the impact of this standard on its consolidated financial statements. In April 2019, the FASB issued Update No. 2019-04, Codification Improvements to Topic 326, Financial Instruments—Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments. This Update includes several amendments to the Codification intended to clarify, improve, or correct errors in the Codification. Some amendments do not require transition guidance and are effective upon issuance. The amendments requiring transition guidance will be effective for the Company beginning on January 1, 2020. The Company is evaluating the impact of this standard on its consolidated financial statements. Recently Adopted Accounting Standards In May 2014, the FASB issued Update No. 2014-09, Revenue from Contracts with Customers (Topic 606). The new standard provides a five-step approach to be applied to all contracts with customers. The new standard also requires expanded disclosure about revenue recognition. The new standard as amended by ASU 2015-14, ASU 2016-10 and ASU 2016-12, was effective for the Company beginning on January 1, 2019. The Company performed an assessment of the impact of this new standard on its consolidated financial statements. In assessing the impact, the Company outlined all revenue streams, and considered the five steps outlined in the standard for product sales, from which substantially all the Company's revenue is generated. The Company analyzed the impact of this new standard on all revenue streams and on all contracts with customers, including by reviewing contracts and current accounting policies and practices to identify differences that would result from applying the requirements under the new standard. The Company adopted the new standard using the modified retrospective method under which the cumulative effect of initially applying the new guidance to open contracts as of December 31, 2018 is recognized as an adjustment to the opening balance of retained earnings as of January 1, 2019. The timing of revenue recognition under the new standard is not materially different from the Company's previous revenue recognition policy. As a result of the Company's adoption of the new standard, the Company reclassed its sales return reserve from accounts receivable to a refund liability account within other current liabilities. Based on the Company’s analysis of open contracts as of December 31, 2018, the cumulative effect of applying the new standard was not material. Revenue is recognized when obligations under the terms of a contract with the Company's customer are satisfied which occurs with the transfer of control of the Company's products. This occurs either upon shipment or delivery of goods, depending on whether the contract is Free on Board (FOB) origin or FOB destination, or, in other situations such as consignment arrangements, when the products are used in a surgical procedure (implanted in a patient). Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring products to a customer (transaction price). To the extent that the transaction price includes variable consideration, such as discounts, list price discounts, rebates, volume discounts and customer payment penalties, the Company estimates the amount of variable consideration that should be included in the transaction price utilizing the most likely amount method. Variable consideration is included in the transaction price if, in the Company’s judgment, it is probable that a significant future reversal of cumulative revenue under the contract will not occur. Estimates of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on an assessment of the Company’s anticipated performance and all information (historical, current and forecasted) that is reasonably available. The Company reduces revenue by estimates of potential future product returns and other allowances. Provisions for product returns and other allowances are recorded as a reduction to revenue in the period sales are recognized. The Company estimates the amount of sales returns and allowances that will eventually be incurred. Certain contracts with stocking distributors contain provisions requiring the Company to repurchase inventory upon termination of the contract or discontinuation of a product line. Included in the sales returns reserve within other current liabilities is an estimate of repurchases that are likely to be made under these provisions. Management analyzes sales programs that are in effect, contractual arrangements, market acceptance and historical trends when evaluating the adequacy of sales returns and allowance accounts. The Company has made an accounting policy election to account for shipping and handling activities as fulfillment activities. As such the Company does not evaluate shipping and handling as promised services to its customers. See Note 13 "Segment and Geographic Information" below for a presentation of the Company's disaggregated revenue. In August 2016, the FASB issued Update No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. This new standard addresses eight specific cash flow issues related to cash receipts and cash payments with the objective of reducing the existing diversity of presentation and classification in the statement of cash flows. The new standard was effective for the Company beginning on January 1, 2019, and was applied using a retrospective transition method to each period presented. Adoption of this new guidance had no impact on the Company’s cash flows statements. In May 2017, the FASB issued Update No. 2017-09, Compensation- Stock Compensation (Topic 718): Scope of Modification Accounting. The new standard provides guidance regarding which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718. The new standard was effective for the Company beginning on January 1, 2018. Adoption of this new guidance had no impact on the Company’s consolidated financial statements. Net Loss Per Share Basic and diluted net loss per share was calculated using the weighted-average number of shares of common stock outstanding during the period. The weighted average number of shares used to compute diluted net loss per share excludes any assumed exercise of stock options, any assumed issuance of common stock under restricted stock awards or units, and any assumed issuances under the employee stock purchase plan, as the effect, in each case, would be antidilutive. Common stock equivalents of 3.6 million and 3.4 million shares for the nine months ended September 30, 2019 and 2018, respectively, were excluded from the calculation because of their antidilutive effect.

DEBT AND INTEREST	9 Months Ended
DEBT AND INTEREST	Sep. 30, 2019
Debt Disclosure [Abstract]
Debt Disclosure [Text Block]	DEBT AND INTEREST Credit Agreement In December 2015, the Company entered into a three-year credit facility with Wells Fargo Bank, National Association, which was amended in October 2016 and in July 2018 (as amended, the Credit Facility). The Credit Facility provides an asset-backed revolving line of credit of up to $30.0 million with a maturity date of July 27, 2021, which is subject to a one-time, one-year extension at the Company's election. In addition, under the Credit Facility, at any time through July 27, 2020, the Company may increase the $30.0 million borrowing limit by up to an additional $10.0 million, subject to the Company having sufficient amounts of eligible accounts receivable and inventory and to customary conditions precedent, including obtaining the commitment of lenders to provide such additional amount. In connection with the Credit Facility, the Company was required to become a guarantor and to provide a security interest in substantially all its assets for the benefit of the counterparty. There were no amounts outstanding under the Credit Facility at September 30, 2019 or December 31, 2018. At September 30, 2019, the Company had $25.0 million of current borrowing capacity under the Credit Facility. Debt issuance costs and legal fees related to the Credit Facility totaling $0.6 million were recorded as a deferred asset and are being amortized ratably over the term of the arrangement. Borrowings under the Credit Facility accrue interest at the rate then applicable to base rate loans (as customarily defined), unless and until converted into LIBOR rate loans (as customarily defined) in accordance with the Credit Facility. Borrowings bear interest at a floating annual rate equal to (a) during any month for which the Company's average excess availability (as customarily defined) is greater than $20.0 million, (i) base rate plus 1.25 percentage points for base rate loans and (ii) LIBOR rate plus 2.25 percentage points for LIBOR rate loans, (b) during any month for which the Company's average excess availability is greater than $10.0 million but less than or equal to $20.0 million, (i) base rate plus 1.50 percentage points for base rate loans and (ii) LIBOR rate plus 2.50 percentage points for LIBOR rate loans and (c) during any month for which the Company's average excess availability is less than or equal to $10.0 million, (i) base rate plus 1.75 percentage points for base rate loans and (ii) LIBOR rate plus 2.75 percentage points for LIBOR rate loans. The Company will also pay an unused line fee based on the average amount borrowed under the Credit Facility for the most recently completed month. If such average amount is 25% or greater of the maximum borrowing capacity, the unused fee will be equal to 0.375% per annum of the amount unused under the Credit Facility, and if such average amount is less than 25%, the unused line fee will be equal to 0.50% per annum of the amount unused under the Credit Facility. The unused line fee is due on the first day of each month. The Credit Facility contains various customary affirmative and negative covenants, including prohibiting the Company from incurring indebtedness without the lender’s consent. The Credit Facility also includes a financial covenant that requires the Company to maintain a minimum fixed charge coverage ratio of 1.10 to 1.00 for the applicable measurement period, if the Company's Total Liquidity (as defined in the Credit Facility) is less than $5.0 million. The Company was in compliance with all applicable covenants at September 30, 2019. The Credit Facility also includes customary events of default, including events of default relating to non-payment of amounts due under the Credit Facility, material inaccuracy of representations and warranties, violation of covenants, bankruptcy and insolvency, failure to comply with health care laws, violation of certain of the Company’s existing agreements, and the occurrence of a change of control. Under the Credit Facility, if an event of default occurs, the lender will have the right to terminate the commitments and accelerate the maturity of any loans outstanding.

INVENTORIES

9 Months Ended

Sep. 30, 2019

Inventory, Net [Abstract]

INVENTORIES

Inventories consisted of:



	September 30, 2019		December 31, 2018
	(In thousands)
Finished goods	$	30,904	$	27,589
Work in process	10,583		10,367
Raw materials	6,524		4,786
	$	48,011	$	42,742

INVESTMENTS (Notes)

9 Months Ended

Sep. 30, 2019

Investments, Debt and Equity Securities [Abstract]

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

INVESTMENTS

The amortized cost, estimated fair value and gross unrealized gains and losses on investments are shown in the table below:



	September 30, 2019
	Amortized Cost		Gross Unrealized			Fair Value
	Amortized Cost		Gains	(Losses)		Fair Value
	(In thousands)
U.S. Treasury Bills	$	4,994	2	$	—	$	4,996



	December 31, 2018
	Amortized Cost		Gross Unrealized				Fair Value
	Amortized Cost		Gains	(Losses)			Fair Value
	(In thousands)
U.S. Treasury Bills	$	29,803	—	$	(3	)	$	29,800

As of September 30, 2019, the Company’s investment portfolio included zero U.S. Treasury Bills in an unrealized loss position, as compared to 9 at December 31, 2018. There were no other-than-temporary impairments on debt securities or realized gains or losses during the three and nine months ended September 30, 2019.

PROPERTY, PLANT AND EQUIPMENT

9 Months Ended

Sep. 30, 2019

Property, Plant and Equipment [Abstract]

PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment are stated at historical cost less accumulated depreciation and any impairment charges. The Company provides for depreciation using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized over the lesser of the lease term or the useful life. The cost of major additions and improvements is capitalized, while maintenance and repair costs that do not improve or extend the lives of the respective assets are charged to operations as incurred. The cost of computer software obtained for internal use is accounted for in accordance with the Codification 350-40, Internal-Use Software.

The cost of purchased spinal instruments which the Company consigns to hospitals and independent sales agents to support surgeries is initially capitalized as construction in progress. The amount is either then reclassified to spinal instruments and sets and depreciation is initiated when instruments are put together in a newly built set with spinal implants, or directly expensed for the instruments used to replace damaged instruments in an existing set. The depreciation expense and direct expense for replacement instruments are recorded in selling, general and administrative expense.

Property, plant and equipment balances and corresponding useful lives were as follows:



	September 30, 2019			December 31, 2018			Useful Lives
	(In thousands)
Leasehold improvement	$	5,848		$	5,724		Shorter of lease term or useful life
Machinery and production equipment	8,545			7,752			3-10 years
Spinal instruments and sets	25,820			23,212			5 years
Information systems and hardware	7,651			7,290			3-7 years
Furniture and fixtures	1,359			1,222			3-5 years
Construction in progress	10,067			7,013
Total	59,290			52,213
Less accumulated depreciation and amortization	(32,649		)	(29,590		)
Property, plant and equipment, net	$	26,641		$	22,623

Depreciation expenses totaled $1.3 million and $1.1 million for the three months ended September 30, 2019 and 2018, respectively, and $3.6 million and $3.1 million for the nine months ended September 30, 2019 and 2018, respectively. The cost of purchased instruments used to replace damaged instruments in existing sets and recorded directly to instrument replacement expense totaled $0.6 million and $0.3 million for the three months ended September 30, 2019 and 2018, respectively, and $1.6 million and $1.3 million for the nine months ended September 30, 2019 and 2018, respectively.

IDENTIFIABLE INTANGIBLE ASSETS

9 Months Ended

Sep. 30, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

IDENTIFIABLE INTANGIBLE ASSETS

Identifiable intangible assets are initially recorded at fair value at the time of acquisition, generally using an income or cost approach. The Company capitalizes costs incurred to renew or extend the term of recognized intangible assets and amortizes those costs over their expected useful lives.

The Company shifted its commercialization strategy with respect to the product technologies it acquired from NLT (as defined below) due to market trend factors, new features necessary to be competitive, and more cost-effective internal development initiatives and the Company's estimated future net sales associated with those product technologies decreased. Accordingly, the Company evaluated the ongoing value of the product technology intangible assets associated with the acquisition of these assets. Based on this evaluation, the Company determined that intangible assets with a carrying amount of $6.8 million were no longer recoverable and were impaired, and the Company wrote those intangible assets down to their estimated fair value of $1.8 million at June 30, 2019. Significant estimates used in determining the estimated fair value include measurements estimating cash flows and determining the appropriate discount rate, which are considered Level 3 inputs, as defined using the fair value concepts defined in Codification 820.

The components of the Company’s identifiable intangible assets were:



	September 30, 2019
	Weighted Average Life	Cost		Accumulated Amortization			Net
	(Dollars in thousands)
Product technology	12 years	$	33,309	$	(28,616	)	$	4,693
Customer relationships	12 years	56,830		(42,111		)	14,719
Trademarks/brand names	—	300		(300		)	—
		$	90,439	$	(71,027	)	$	19,412



	December 31, 2018
	Weighted Average Life	Cost		Accumulated Amortization			Net
	(Dollars in thousands)
Product technology	12 years	$	40,769	$	(29,153	)	$	11,616
Customer relationships	12 years	56,830		(39,734		)	17,096
Trademarks/brand names	—	300		(300		)	—
		$	97,899	$	(69,187	)	$	28,712

Annual amortization expense (including amounts reported in cost of goods sold) is expected to be approximately $5.4 million in 2019, $4.3 million in 2020, $4.3 million in 2021, $4.1 million in 2022, and $3.5 million in 2023. For the three months ended September 30, 2019 and 2018, amortization expense totaled $1.2 million and $1.6 million, respectively, and included $0.4 million and $0.8 million, respectively, of amortization of product technology intangible assets that is presented within cost of goods sold. Amortization expense totaled $4.3 million and $4.9 million for the nine months ended September 30, 2019 and 2018, respectively, and included $1.9 million and $2.5 million, respectively, of amortization of product technology intangible assets that is presented within cost of goods sold.

FAIR VALUE MEASUREMENTS (Notes)

9 Months Ended

Sep. 30, 2019

Fair Value Disclosures [Abstract]

Fair Value Disclosures [Text Block]

FAIR VALUE MEASUREMENTS

The fair values of the Company’s assets and liabilities, including contingent consideration liabilities, are measured at fair value on a recurring basis, and are determined under the fair value categories as follows (in thousands):



	Total		Quoted Price in Active Market (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
September 30, 2019:
Short-term investments	$	4,996	$	4,996	$	—	$	—
Total Assets
Contingent consideration liabilities- current	$	711	$	—	$	—	$	711
Contingent consideration liabilities- non-current	1,116		—		—		1,116
Total contingent consideration	$	1,827	$	—	$	—	$	1,827



	Total		Quoted Price in Active Market (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
December 31, 2018:
Short-term investments	$	29,800	$	29,800	$	—	$	—
Total Assets
Contingent consideration liabilities- current	$	129	$	—	$	—	$	129
Contingent consideration liabilities- non-current	2,367		—		—		2,367
Total contingent consideration	$	2,496	$	—	$	—	$	2,496

Short-term investments are classified with Level 1 of the fair value hierarchy because they use quoted market prices in active markets for identical assets.

The Company is obligated to pay up to $5.0 million in milestone payments in connection with the August 2016 purchase of certain assets of N.L.T Spine Ltd. (NLT) and NLT Spine, Inc., a wholly owned subsidiary of NLT, payable at the Company's election in cash or in shares of its common stock. Such milestone payments are contingent on the Company's achievement of four independent events related to the commercialization of the product technologies the Company acquired in the transaction. Additionally, the Company must pay royalty payments, in cash, to NLT equal to declining (over time) percentages of the Company’s future net sales of certain of the acquired product technologies not to exceed $43.0 million in the aggregate. The Company has the option to terminate any future obligation to make royalty payments by making a one-time cash payment to NLT of $18.0 million.

Contingent consideration liabilities are classified within Level 3 of the fair value hierarchy because they use significant unobservable inputs. For those liabilities, fair value is determined using a probability-weighted discounted cash flow model and significant inputs which are not observable in the market. The significant inputs include assumptions related to the timing and probability of the product launch dates, estimated future sales of the products, discount rates matched to the timing of payments, and probability of success rates.

The following table sets forth the changes in the estimated fair value of the Company’s liabilities measured on a recurring basis using significant unobservable inputs (Level 3). The gain from change in fair value of contingent milestone and royalty payments resulted from updated estimated timing of payments, probability of success rates, the passage of time, updated discount rates matched to the estimated timing of payments, actual net sales of certain products for the nine months ended September 30, 2019, and estimated net sales for future royalty payment periods.

A change in estimated timing of payments, probability of success rates, or estimated net sales for future royalty payment periods would be expected to have a material impact on the fair value of contingent milestone and royalty payments.



Three Months Ended September 30, 2019:	(in thousands)
Balance as of June 30, 2019	$	1,934
Contingent consideration liabilities settled	(42		)
Gain from change in fair value of contingent consideration recorded in selling, general and administrative expenses	(65		)
Fair value at September 30, 2019	$	1,827



Nine Months Ended September 30, 2019:	(in thousands)
Balance as of January 1, 2019	$	2,496
Contingent consideration liabilities settled	(98		)
Gain from change in fair value of contingent consideration recorded in selling, general and administrative expenses	(571		)
Fair value at September 30, 2019	$	1,827

- 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

EQUITY AND STOCK-BASED COMPENSATION

9 Months Ended

Sep. 30, 2019

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

STOCK-BASED COMPENSATION

EQUITY AND STOCK-BASED COMPENSATION

Common Stock

In August 2016, the Company entered into an equity distribution agreement (Distribution Agreement) with Piper Jaffray & Co. (Piper Jaffray), pursuant to which the Company may offer and sell shares of its common stock in “at the market” (ATM) offerings (as defined in Rule 415 of the Securities Act of 1933, as amended) having an aggregate offering price up to $25.0 million in gross proceeds from time to time through Piper Jaffray acting as sales agent. The shares offered and sold under the Distribution Agreement are covered by a registration statement on Form S-3 that was declared effective on August 24, 2016. Under the Distribution Agreement, during the nine months ended September 30, 2018, the Company sold 882,332 shares of common stock at an average price per share of $10.00 and received net proceeds of approximately $8.5 million (net of $0.3 million of offering costs), which consumed the remaining capacity under the Distribution Agreement. The Company used the net proceeds for general corporate purposes, including sales and marketing expenditures aimed at growing its business, research and development expenditures focused on product development, and investments in inventory and spinal instruments and sets.

In May 2018, the Company entered into another equity distribution agreement with Piper Jaffray (the May 2018 Distribution Agreement), pursuant to which the Company may offer and sell shares of its common stock in ATM offerings having an aggregate offering price up to $50.0 million in gross proceeds from time to time through Piper Jaffray acting as sales agent. The shares offered and sold under the May 2018 Distribution Agreement are covered by a registration statement on Form S-3 that was declared effective on August 24, 2016. On March 1, 2019, the Company terminated the May 2018 Distribution Agreement. The Company is not subject to any termination penalties related to the termination of the May 2018 Distribution Agreement. Prior to termination, the Company had not sold any shares of its Common Stock pursuant to the May 2018 Distribution Agreement.

In October 2018, the Company entered into an Underwriting Agreement (Underwriting Agreement) with Wells Fargo Securities, LLC, Piper Jaffray and Cantor Fitzgerald & Co. (Cantor Fitzgerald) acting as joint bookrunning managers and as representatives of the underwriters relating to the issuance and sale of 3,250,000 shares of the Company’s common stock. The price to the public in the offering was $15.50 per share, before underwriting discounts and commissions. The Company granted the underwriters an option, exercisable for 30 days, to purchase up to an additional 487,500 shares of common stock. The underwriters exercised this option and the offering closed on October 15, 2018 with the sale of 3,737,500 shares of the Company's common stock. The net proceeds to the Company from the offering were approximately $54.1 million, after deducting underwriting discounts and commissions and estimated offering expenses payable by the Company. The Company used a portion of the net proceeds from the offering to repay all of its then-outstanding borrowings under the Credit Facility, and intends to use the remaining proceeds for general corporate purposes, including general and administrative expenses, capital expenditures and general working capital purposes.

In March 2019, the Company entered into a controlled equity offering sales agreement (Sales Agreement) with Cantor Fitzgerald to sell shares of its common stock having an aggregate offering price of up to $50.0 million from time to time, through an ATM offering under which Cantor Fitzgerald will act as sales agent. The shares offered and sold under the Sales Agreement are covered by a registration statement on Form S-3 that was declared effective on August 24, 2016, and a prospectus supplement related to the ATM offering, dated March 1, 2019. The Company did not sell any shares of common stock under the Sales Agreement during the nine months ended September 30, 2019 and, on October 23, 2019, notified Cantor Fitzgerald of its intent to terminate the agreement, which the Company and Cantor Fitzgerald mutually agreed to terminate effective as of October 23, 2019.

Equity Award Plans

As of June 30, 2015, Integra had stock options, restricted stock awards, performance stock awards, contract stock awards and restricted stock units outstanding under three plans, the 2000 Equity Incentive Plan, the 2001 Equity Incentive Plan, and the 2003 Equity Incentive Plan. In connection with the spin-off, Integra equity awards granted to individuals who became employees of SeaSpine were converted to equity awards denominated in SeaSpine common stock. In general, each post-conversion award is subject to the same terms and conditions as were applicable to the pre-conversion award.

In May 2015, the Company adopted the 2015 Incentive Award Plan, which was subsequently amended and restated with approval of the Company's stockholders. In February and March 2018, the Company's board of directors approved amendments to the plan that increased the share reserve by an aggregate of 2,726,000 shares over the then-existing share reserve thereunder, subject to stockholder approval. The Company's stockholders approved both amendments on May 30, 2018 (the 2015 Incentive Award Plan, as amended and restated to date, the Restated Plan). Under the Restated Plan, the Company can grant its employees, non-employee directors and consultants incentive stock options and non-qualified stock options, restricted stock, performance stock, dividend equivalent rights, stock appreciation rights, stock payment awards and other incentive awards. The aggregate number of shares that may be issued or transferred pursuant to awards under the Restated Plan is the sum of (1) the number of shares issuable upon exercise or vesting of the number of Integra equity awards converted to the Company's equity awards under the Restated Plan as of the date of the spin-off and (2) 6,235,500 shares of its common stock in respect of awards granted under the Restated Plan. As of September 30, 2019, 1,834,877 shares were available for issuance under the Restated Plan.

In 2016, the Company established the 2016 Employment Inducement Incentive Award Plan (the 2016 Plan), a broad-based incentive plan which allows for the issuance of stock-based awards, including non-qualified stock options, restricted stock awards, performance awards, restricted stock unit awards and stock appreciation rights, to those individuals and in those circumstances described below. An aggregate of 1,000,000 shares are reserved for issuance under the 2016 Plan. The Company has not awarded any shares under the 2016 Plan as of September 30, 2019. As a result of the stockholders' approval of the Restated Plan, the Company's board of directors will not grant any awards under the 2016 Plan.

In June 2018, the Company established the 2018 Employment Inducement Incentive Award Plan (the 2018 Inducement Plan). The terms of the 2018 Plan are substantially similar to the terms of the Restated Plan with these principal exceptions: (1) incentive stock options may not be granted under the 2018 Inducement Plan; (2) there are no annual limits on awards that may be issued to an individual under the 2018 Inducement Plan; (3) awards granted under the 2018 Inducement Plan are not required to be subject to any minimum vesting period; and (4) awards may be granted under the 2018 Inducement Plan only to those individuals and in those circumstances described below. An aggregate of 2,000,000 shares are reserved under the 2018 Inducement Plan. As of September 30, 2019, 1,939,750 shares were available for issuance under the 2018 Inducement Plan.

Both the 2016 Inducement Plan and the 2018 Inducement Plan were adopted by the Company’s board of directors without stockholder approval pursuant to Rule 5635(c)(4) of the Nasdaq Listing Rules. In accordance with Rule 5635(c)(4) of the Nasdaq Listing Rules, awards under those plans may only be made to an employee who has not previously been an employee or member of the Company's board of directors or of any board of directors of any parent or subsidiary of the Company, or following a bona fide period of non-employment by the Company or a parent or subsidiary, if he or she is granted such award in connection with his or her commencement of employment with the Company or a subsidiary and such grant is an inducement material to his or her entering into employment with the Company or such subsidiary.

Forfeiture Rate Assumptions

Stock-based compensation expense related to all equity awards includes an estimate for forfeitures. The expected forfeiture rate of all equity-based compensation is based on historical experience of pre-vesting forfeitures on awards and options by each homogenous group of shareowners. For awards and options granted to non-executive employees, the forfeiture rate is estimated to be 14% annually for the nine months ended September 30, 2019 and 13% annually for the nine months ended September 30, 2018. There is no forfeiture rate applied to awards or options granted to non-employee directors or executive employees because their pre-vesting forfeitures are anticipated to be highly unlikely. As individual awards and options become fully vested, stock-based compensation expense is adjusted to recognize actual forfeitures.

Restricted Stock Awards and Restricted Stock Units

The Company expenses the fair value of restricted stock awards and of restricted stock units on an accelerated basis over the vesting period or requisite service period, whichever is shorter.

No restricted stock units were granted to non-employee directors during the three or nine months ended September 30, 2019 or 2018. During the nine months ended September 30, 2019 and 2018, there were 76,471 and 95,658 shares of restricted stock awards granted to non-employee directors, respectively.

During the three and nine months ended September 30, 2019, there were 34,100 and 252,710 restricted stock units granted to employees, respectively. During the three and nine months ended September 30, 2018, there were 67,319 and 554,600 restricted stock units granted to employees, respectively. Of such restricted stock units granted to employees during the nine months ended September 30, 2018, 341,808 were granted, in part, out of the increase to the share reserve under the Restated Plan adopted by the Company's board of directors on February 1, 2018, all of which were granted subject to stockholder approval of the Restated Plan (the Contingent RSUs). On May 30, 2018, the Company's stockholders approved the Restated Plan, and in accordance with the Codification 718, Compensation-Stock Compensation, the Company began recognizing the expense for the Contingent RSUs over the requisite service period.

No shares of restricted stock awards were granted to employees during the three or nine months ended September 30, 2019 or 2018.

As of September 30, 2019, there was approximately $4.3 million of unrecognized compensation expense related to the unvested portions of restricted stock awards and of restricted stock units. This expense is expected to be recognized over a weighted-average period of approximately 0.8 years.

Stock Options

Stock option grants to employees generally have a requisite service period of four years, and stock option grants to non-employee directors generally have a requisite service period of one year. Both are subject to graded vesting. The Company records stock-based compensation expense associated with stock options on an accelerated basis over the applicable vesting period within each grant and based on their fair value at the date of grant using the Black-Scholes-Merton option pricing model. No stock options were granted during the three months ended September 30, 2019. There were 22,500 stock options granted during the three months ended September 30, 2018, and 434,708 and 27,500 stock options granted during the nine months ended September 30, 2019 and 2018, respectively. The following weighted-average assumptions were used in the calculation of fair value for options granted during the period indicated.



	Three Months Ended September 30,		Nine Months Ended September 30,
	2018		2019		2018
Expected dividend yield	0	%	0	%	0	%
Risk-free interest rate	2.8	%	2.5	%	2.8	%
Expected volatility	25.6	%	30.3	%	25.6	%
Expected term (in years)	4.9		2.9		4.9

The Company considered that it has never paid, and does not currently intend to pay, cash dividends. The risk-free interest rates are derived from the U.S. Treasury yield curve in effect on the date of grant for instruments with a remaining term similar to the expected term of the options. Due to the Company’s limited historical data, the expected volatility is calculated based upon the historical volatility of comparable companies in the medical device industry whose share prices are publicly available for a sufficient period of time. The expected term of "plain vanilla" options is calculated using the simplified method as prescribed by accounting guidance for stock-based compensation. A "plain vanilla" option is an option with the following characteristics: (1) the option is granted at-the-money; (2) exercisability is conditional only on satisfaction of a service condition through the vesting date; (3) employees who terminate their service prior to vesting forfeit the option; (4) employees who terminate their service after vesting are granted limited time to exercise their options; and (5) the option is nontransferable and non-hedgeable. The expected term of any other option is based on disclosures from similar companies with similar grants.

As of September 30, 2019, there was approximately $1.0 million of unrecognized compensation expense related to unvested stock options. This expense is expected to be recognized over a weighted-average period of approximately 1.3 years.

Employee Stock Purchase Plan

In May 2015, the Company adopted the SeaSpine Holdings Corporation 2015 Employee Stock Purchase Plan, which was amended in December 2015 (as amended, the ESPP). Under the ESPP, eligible employees may purchase shares of the Company’s common stock through payroll deductions of up to 15% of eligible compensation during an offering period. Generally, each offering period will be for 24 months as determined by the Company's board of directors. There are four six-month purchase periods in each offering period for contributions to be made and to be converted into shares at the end of the purchase period. In no event may an employee purchase more than 2,500 shares per purchase period based on the closing price on the first trading date of an offering period or more than $25,000 worth of stock during any calendar year. The purchase price for shares to be purchased under the ESPP is 85% of the lesser of the market price of the Company's common stock on the first trading date of an offering period or on any purchase date during an offering period (June 30 or December 31).

Subject to stockholder approval, on and effective as of November 2, 2018, the Company's board of directors approved an amendment to the ESPP pursuant to which the share reserve under the ESPP would increase from 400,000 shares to 800,000 shares. On May 29, 2019, the Company's stockholders approved that amendment. The 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. The ESPP contains a restart feature, such that if the market price of the stock at the end of any six-month purchase period is lower than the market price at the original grant date of an offering period, that offering period will terminate after that purchase date, and a new two-year offering period will commence on the January 1 or July 1 immediately following the date the original offering period terminated. This restart feature was triggered on the purchase date that occurred on December 31, 2016, such that the offering period that commenced on July 1, 2016 was terminated, and a new two-year offering period commenced on January 1, 2017 and ended on December 31, 2018. The restart feature was triggered again on the purchase date that occurred on June 30, 2019, such that the offering period that commenced on January 1, 2019 was terminated, and a new two-year offering period commenced on July 1, 2019 and will end on June 30, 2021. The Company applied share-based payment modification accounting to the awards that were initially valued at the grant date to determine the amount of any incremental fair value associated with the modified awards. The impact to stock-based compensation expense for modifications during the nine months ended September 30, 2019 was immaterial.

During the nine months ended September 30, 2019 and 2018, there were 64,008 and 80,907 shares of common stock, respectively, purchased under the ESPP. The Company recognized $0.6 million and $0.2 million, respectively, in expense related to the ESPP for the nine months ended September 30, 2019 and 2018. As of September 30, 2019, 336,056 shares were available under the ESPP for future issuance.

The Company estimates the fair value of shares issued to employees under the ESPP using the Black-Scholes-Merton option-pricing model. The following weighted average assumptions were used in the calculation of fair value of shares under the ESPP at the grant date for the periods indicated:



	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
Expected dividend yield	0	%	0	%	0	%	0	%
Risk-free interest rate	1.9	%	2.4	%	1.4	%	2.0	%
Expected volatility	36.6	%	34.2	%	21.9	%	29.4	%
Expected term (in years)	1.3		1.3		0.7		1.3

LEASES

9 Months Ended

Sep. 30, 2019

Leases [Abstract]

Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block]

LEASES

The Company leases administrative, manufacturing, research, and distribution facilities and various manufacturing, office and transportation equipment through operating lease agreements.

Future minimum lease payments under the Company's operating leases at September 30, 2019 are as follows:



	Payments Due by Calendar Year
	(In thousands)
2019	987
2020	3,243
2021	2,162
2022	2,183
2023	1,508
Thereafter	4,537
Total minimum lease payments	$	14,620

Total lease expense was $0.5 million for each of the three months ended September 30, 2019 and 2018 and was $1.6 million for each of the nine months ended September 30, 2019 and 2018.

INCOME TAXES

9 Months Ended

Sep. 30, 2019

Income Tax Disclosure [Abstract]

INCOME TAXES

The following table summarizes the Company’s effective tax rate for the periods indicated:



	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018

Reported income tax expense rate	(2.4	)%	1.1	%	(0.9	)%	—	%

The Company recorded a provision for income tax expense for the three and nine months ended September 30, 2019 primarily related to foreign and state operations.

The Tax Cuts and Jobs Act (the Tax Act) enacted in 2017 reduced the U.S. federal corporate rate from 35% to 21%, requires companies to pay a one-time transition tax on accumulated earnings of certain foreign subsidiaries previously deferred from tax, and created a new provision designed to tax global intangible low-taxed income (GILTI).

The Company is not subject to the one-time transition tax on accumulated foreign earnings or the GILTI provisions enacted by the Tax Act because the Company's foreign operations have been included in its US tax filings pursuant to an election to disregard its foreign entity for federal income tax purposes.

In addition, for all periods presented, the pretax losses incurred by the consolidated U.S. tax group received no corresponding tax benefit because the Company concluded that it is more likely than not that the Company will be unable to realize the value of any resulting deferred tax assets. The Company will continue to assess its position in future periods to determine if it is appropriate to reduce a portion of its valuation allowance in the future.

COMMITMENTS AND CONTINGENCIES	9 Months Ended
COMMITMENTS AND CONTINGENCIES	Sep. 30, 2019
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	COMMITMENTS AND CONTINGENCIES In consideration for certain technology, manufacturing, distribution, and selling rights and licenses granted to the Company, the Company has agreed to pay royalties on sales of certain products sold by the Company. Except for the royalties payable to NLT, the royalty payments that the Company made under these agreements are included in the condensed consolidated statements of operations as a component of cost of goods sold. The Company is subject to various legal proceedings in the ordinary course of its business with respect to its products, its current or former employees, and its commercial relationships, some of which have been settled by the Company. In the opinion of management, such proceedings are either adequately covered by insurance or otherwise indemnified, or are not expected, individually or in the aggregate, to result in a material adverse effect on the Company's financial condition. However, it is possible that the Company's results of operations, financial position and cash flows in a particular period could be materially affected by these contingencies. The Company accrues for loss contingencies when it is deemed probable that a loss has been incurred and that loss is estimable. The amounts accrued are based on the full amount of the estimated loss before considering insurance proceeds, and do not include an estimate for legal fees expected to be incurred in connection with the loss contingency. While uncertainty exists, the Company does not believe there are any pending legal proceedings that would have a material impact on the Company’s financial position, cash flows or results of operations.

SEGMENT AND GEOGRAPHIC INFORMATION

9 Months Ended

Sep. 30, 2019

Segment Reporting [Abstract]

SEGMENT AND GEOGRAPHIC INFORMATION

Segment Reporting

Management assessed its segment reporting based on how it internally manages and reports the results of its business to its chief operating decision maker. Management reviews financial results, manages the business and allocates resources on an aggregate basis. Therefore, financial results are reported in a single operating segment: the development, manufacture and marketing of orthobiologics and of spinal implants. The Company reports revenue in two product categories: orthobiologics and spinal implants. Orthobiologics products consist of a broad range of advanced and traditional bone graft substitutes that are designed to improve bone fusion rates following surgery. The spinal implants portfolio consists of an extensive line of products for minimally invasive surgery, complex spine, deformity and degenerative procedures. The Company attributes revenues to geographic areas based on the location of the customer.

The following table disaggregates revenue by major sales channel for each of the periods presented (in thousands):



	Three Months Ended September 30, 2019						Nine Months Ended September 30, 2019
	United States		International		Total		United States		International		Total
Orthobiologics	$	18,165	$	1,908	$	20,073	$	53,362	$	5,821	$	59,183
Spinal implants	17,371		2,444		19,815		49,197		6,964		56,161
Total revenue, net	$	35,536	$	4,352	$	39,888	$	102,559	$	12,785	$	115,344



	Three Months Ended September 30, 2018						Nine Months Ended September 30, 2018
	United States		International		Total		United States		International		Total
Orthobiologics	$	16,689	$	1,840	$	18,529	$	49,140	$	6,046	$	55,186
Spinal implants	15,028		2,277		17,305		44,754		5,478		50,232
Total revenue, net	$	31,717	$	4,117	$	35,834	$	93,894	$	11,524	$	105,418

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	9 Months Ended
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	Sep. 30, 2019
Accounting Policies [Abstract]
Use of Estimates	Use of Estimates Preparing consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent liabilities, and the reported amounts of revenues and expenses. Significant estimates affecting amounts reported or disclosed in the consolidated financial statements include allowances for doubtful accounts receivable and sales returns and other credits, net realizable value of inventories, discount rates and estimated projected cash flows used to value and test impairments of identifiable intangible and long-lived assets, assumptions related to the timing and probability of product launch dates, discount rates matched to the estimated timing of payments, probability of success rates and discount adjustments on the related cash flows for contingent considerations in business combinations, depreciation and amortization periods for identifiable intangible and long-lived assets, computation of taxes, valuation allowances recorded against deferred tax assets, the valuation of stock-based compensation and loss contingencies. These estimates are based on historical experience and on various other assumptions believed to be reasonable under the current circumstances. Actual results could differ from these estimates.
Recently Issued and Adopted Accounting Standards	Recent Accounting Standards Not Yet Adopted The Company qualifies as an “emerging growth company” (EGC) under the Jumpstart Our Business Startups (JOBS) Act and elected to take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act of 1933, as amended, which permits EGCs to defer compliance with new or revised accounting standards (the EGC extension) until non-issuers must comply with such standards. Accordingly, so long as the Company continues to qualify as an EGC, the Company will not have to adopt or comply with new or revised accounting standards until non-issuers must adopt or comply with such standards. In February 2016, the Financial Accounting Standard Board (FASB) issued Accounting Standards Update (ASU or Update) No. 2016-02, Leases (Topic 842). The new standard requires lessees to recognize lease liabilities and corresponding right-of-use assets for all leases with lease terms of greater than twelve months. It also changes the definition of a lease and expands the disclosure requirements of lease arrangements. The new standard must be adopted using the modified retrospective approach. The Company will early adopt the standard beginning on January 1, 2020. The Company expects to apply the transition practical expedients allowed by the standard. In July 2018, the FASB issued Update No. 2018-10, Codification Improvements to Topic 842 (Leases) and Update No. 2018-11, Leases (Topic 842): Targeted Improvements. In March 2019, the FASB issued Update No. 2019-01, Leases (Topic 842): Codification Improvements. The amendments in ASU 2018-10, ASU 2018-11, and ASU 2019-01 provide additional clarification and implementation guidance on certain aspects of the previously issued ASU 2016-02 and have the same effective date and transition requirements as ASU 2016-02. Note 10 to the Condensed Consolidated Financial Statements provides details on the Company’s current lease arrangements. While the Company continues to evaluate the impact of this new standard on its consolidated financial statements, the Company currently expects the primary impact will be to record right-of-use assets and lease liabilities for existing operating leases in the consolidated balance sheets. The Company does not currently expect the adoption of this new standard to have a material impact on its consolidated results of operations or cash flows. In June 2018, the FASB issued Update No. 2018-07, Compensation-Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting. This Update will require an entity to apply the requirements of Topic 718 to nonemployee awards except for specific guidance on inputs to an option pricing model and the attribution of cost (that is, the period of time over which share-based payment awards vest and the pattern of cost recognition over that period). The amendments specify that Topic 718 applies to all share-based payment transactions in which a grantor acquires goods or services to be used or consumed in a grantor’s own operations by issuing share-based payment awards. The amendments also clarify that Topic 718 does not apply to share-based payments used to effectively provide (1) financing to the issuer or (2) awards granted in conjunction with selling goods or services to customers as part of a contract accounted for under Topic 606. The new standard will be effective for the Company beginning on January 1, 2020. Early adoption is permitted but no earlier than an entity's adoption date of Topic 606. The Company does not currently expect the adoption of this new standard to have a material impact on its consolidated financial statements. In July 2018, the FASB issued Update No. 2018-09, Codification Improvements. This Update includes several amendments to the FASB Accounting Standards Codification (Codification) intended to clarify, improve, or correct errors in the Codification. Some amendments do not require transition guidance and are effective upon issuance. The amendments requiring transition guidance will be effective for the Company beginning on January 1, 2020. The Company is evaluating the impact of this standard on its consolidated financial statements. In August 2018, the FASB issued Update No. 2018-13, Fair Value Measurement (Topic 820)-Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement. The amendments in this Update modify the disclosure requirements on fair value measurements in Topic 820 based on the concepts in the Concepts Statement including the consideration of costs and benefits. The new standard will be effective for the Company beginning on January 1, 2020. An entity is permitted to early adopt any removed or modified disclosures upon issuance of this Update and delay adoption of the additional disclosures until their effective date. The Company is evaluating the impact of this standard on its consolidated financial statements. In August 2018, the FASB issued Update No. 2018-15, Intangibles-Goodwill and Other-Internal Use Software (Subtopic 350-40). The amendments in this Update align the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). The new standard will be effective for the Company beginning on January 1, 2021. Early adoption is permitted. The Company is evaluating the impact of this standard on its consolidated financial statements. In April 2019, the FASB issued Update No. 2019-04, Codification Improvements to Topic 326, Financial Instruments—Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments. This Update includes several amendments to the Codification intended to clarify, improve, or correct errors in the Codification. Some amendments do not require transition guidance and are effective upon issuance. The amendments requiring transition guidance will be effective for the Company beginning on January 1, 2020. The Company is evaluating the impact of this standard on its consolidated financial statements. Recently Adopted Accounting Standards In May 2014, the FASB issued Update No. 2014-09, Revenue from Contracts with Customers (Topic 606). The new standard provides a five-step approach to be applied to all contracts with customers. The new standard also requires expanded disclosure about revenue recognition. The new standard as amended by ASU 2015-14, ASU 2016-10 and ASU 2016-12, was effective for the Company beginning on January 1, 2019. The Company performed an assessment of the impact of this new standard on its consolidated financial statements. In assessing the impact, the Company outlined all revenue streams, and considered the five steps outlined in the standard for product sales, from which substantially all the Company's revenue is generated. The Company analyzed the impact of this new standard on all revenue streams and on all contracts with customers, including by reviewing contracts and current accounting policies and practices to identify differences that would result from applying the requirements under the new standard. The Company adopted the new standard using the modified retrospective method under which the cumulative effect of initially applying the new guidance to open contracts as of December 31, 2018 is recognized as an adjustment to the opening balance of retained earnings as of January 1, 2019. The timing of revenue recognition under the new standard is not materially different from the Company's previous revenue recognition policy. As a result of the Company's adoption of the new standard, the Company reclassed its sales return reserve from accounts receivable to a refund liability account within other current liabilities. Based on the Company’s analysis of open contracts as of December 31, 2018, the cumulative effect of applying the new standard was not material. Revenue is recognized when obligations under the terms of a contract with the Company's customer are satisfied which occurs with the transfer of control of the Company's products. This occurs either upon shipment or delivery of goods, depending on whether the contract is Free on Board (FOB) origin or FOB destination, or, in other situations such as consignment arrangements, when the products are used in a surgical procedure (implanted in a patient). Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring products to a customer (transaction price). To the extent that the transaction price includes variable consideration, such as discounts, list price discounts, rebates, volume discounts and customer payment penalties, the Company estimates the amount of variable consideration that should be included in the transaction price utilizing the most likely amount method. Variable consideration is included in the transaction price if, in the Company’s judgment, it is probable that a significant future reversal of cumulative revenue under the contract will not occur. Estimates of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on an assessment of the Company’s anticipated performance and all information (historical, current and forecasted) that is reasonably available. The Company reduces revenue by estimates of potential future product returns and other allowances. Provisions for product returns and other allowances are recorded as a reduction to revenue in the period sales are recognized. The Company estimates the amount of sales returns and allowances that will eventually be incurred. Certain contracts with stocking distributors contain provisions requiring the Company to repurchase inventory upon termination of the contract or discontinuation of a product line. Included in the sales returns reserve within other current liabilities is an estimate of repurchases that are likely to be made under these provisions. Management analyzes sales programs that are in effect, contractual arrangements, market acceptance and historical trends when evaluating the adequacy of sales returns and allowance accounts. The Company has made an accounting policy election to account for shipping and handling activities as fulfillment activities. As such the Company does not evaluate shipping and handling as promised services to its customers. See Note 13 "Segment and Geographic Information" below for a presentation of the Company's disaggregated revenue. In August 2016, the FASB issued Update No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. This new standard addresses eight specific cash flow issues related to cash receipts and cash payments with the objective of reducing the existing diversity of presentation and classification in the statement of cash flows. The new standard was effective for the Company beginning on January 1, 2019, and was applied using a retrospective transition method to each period presented. Adoption of this new guidance had no impact on the Company’s cash flows statements. In May 2017, the FASB issued Update No. 2017-09, Compensation- Stock Compensation (Topic 718): Scope of Modification Accounting. The new standard provides guidance regarding which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718. The new standard was effective for the Company beginning on January 1, 2018. Adoption of this new guidance had no impact on the Company’s consolidated financial statements. N
Earnings Per Share	Basic and diluted net loss per share was calculated using the weighted-average number of shares of common stock outstanding during the period. The weighted average number of shares used to compute diluted net loss per share excludes any assumed exercise of stock options, any assumed issuance of common stock under restricted stock awards or units, and any assumed issuances under the employee stock purchase plan, as the effect, in each case, would be antidilutive. Common stock equivalents of 3.6 million and 3.4 million shares for the nine months ended September 30, 2019 and 2018, respectively, were excluded from the calculation because of their antidilutive effect.

REVENUE (Policies)	9 Months Ended
REVENUE (Policies)	Sep. 30, 2018
Revenue from Contract with Customer [Abstract]
Revenue Recognition, Policy [Policy Text Block]	Revenue is recognized when obligations under the terms of a contract with the Company's customer are satisfied which occurs with the transfer of control of the Company's products. This occurs either upon shipment or delivery of goods, depending on whether the contract is Free on Board (FOB) origin or FOB destination, or, in other situations such as consignment arrangements, when the products are used in a surgical procedure (implanted in a patient). Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring products to a customer (transaction price). To the extent that the transaction price includes variable consideration, such as discounts, list price discounts, rebates, volume discounts and customer payment penalties, the Company estimates the amount of variable consideration that should be included in the transaction price utilizing the most likely amount method. Variable consideration is included in the transaction price if, in the Company’s judgment, it is probable that a significant future reversal of cumulative revenue under the contract will not occur. Estimates of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on an assessment of the Company’s anticipated performance and all information (historical, current and forecasted) that is reasonably available. The Company reduces revenue by estimates of potential future product returns and other allowances. Provisions for product returns and other allowances are recorded as a reduction to revenue in the period sales are recognized. The Company estimates the amount of sales returns and allowances that will eventually be incurred. Certain contracts with stocking distributors contain provisions requiring the Company to repurchase inventory upon termination of the contract or discontinuation of a product line. Included in the sales returns reserve within other current liabilities is an estimate of repurchases that are likely to be made under these provisions. Management analyzes sales programs that are in effect, contractual arrangements, market acceptance and historical trends when evaluating the adequacy of sales returns and allowance accounts. The Company has made an accounting policy election to account for shipping and handling activities as fulfillment activities. As such the Company does not evaluate shipping and handling as promised services to its customers. See Note 13 "Segment and Geographic Information" below for a presentation of the Company's disaggregated revenue.

INVENTORIES (Tables)

9 Months Ended

Sep. 30, 2019

Inventory, Net [Abstract]

Schedule of Inventory, Net

Inventories consisted of:



	September 30, 2019		December 31, 2018
	(In thousands)
Finished goods	$	30,904	$	27,589
Work in process	10,583		10,367
Raw materials	6,524		4,786
	$	48,011	$	42,742

INVESTMENTS (Tables)

9 Months Ended

Sep. 30, 2019

Investments, Debt and Equity Securities [Abstract]

Debt Securities, Available-for-sale [Table Text Block]

The amortized cost, estimated fair value and gross unrealized gains and losses on investments are shown in the table below:



	September 30, 2019
	Amortized Cost		Gross Unrealized			Fair Value
	Amortized Cost		Gains	(Losses)		Fair Value
	(In thousands)
U.S. Treasury Bills	$	4,994	2	$	—	$	4,996



	December 31, 2018
	Amortized Cost		Gross Unrealized				Fair Value
	Amortized Cost		Gains	(Losses)			Fair Value
	(In thousands)
U.S. Treasury Bills	$	29,803	—	$	(3	)	$	29,800

PROPERTY, PLANT AND EQUIPMENT (Tables)

9 Months Ended

Sep. 30, 2019

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment

Property, plant and equipment balances and corresponding useful lives were as follows:



	September 30, 2019			December 31, 2018			Useful Lives
	(In thousands)
Leasehold improvement	$	5,848		$	5,724		Shorter of lease term or useful life
Machinery and production equipment	8,545			7,752			3-10 years
Spinal instruments and sets	25,820			23,212			5 years
Information systems and hardware	7,651			7,290			3-7 years
Furniture and fixtures	1,359			1,222			3-5 years
Construction in progress	10,067			7,013
Total	59,290			52,213
Less accumulated depreciation and amortization	(32,649		)	(29,590		)
Property, plant and equipment, net	$	26,641		$	22,623

IDENTIFIABLE INTANGIBLE ASSETS (Tables)

9 Months Ended

Sep. 30, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

Components of Company's Identifiable Intangible Assets

The components of the Company’s identifiable intangible assets were:



	September 30, 2019
	Weighted Average Life	Cost		Accumulated Amortization			Net
	(Dollars in thousands)
Product technology	12 years	$	33,309	$	(28,616	)	$	4,693
Customer relationships	12 years	56,830		(42,111		)	14,719
Trademarks/brand names	—	300		(300		)	—
		$	90,439	$	(71,027	)	$	19,412



	December 31, 2018
	Weighted Average Life	Cost		Accumulated Amortization			Net
	(Dollars in thousands)
Product technology	12 years	$	40,769	$	(29,153	)	$	11,616
Customer relationships	12 years	56,830		(39,734		)	17,096
Trademarks/brand names	—	300		(300		)	—
		$	97,899	$	(69,187	)	$	28,712

Asset Impairment Charges [Text Block]

FAIR VALUE MEASUREMENTS (Tables)

9 Months Ended

Sep. 30, 2019

Fair Value Disclosures [Abstract]

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Table Text Block]



	Total		Quoted Price in Active Market (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
September 30, 2019:
Short-term investments	$	4,996	$	4,996	$	—	$	—
Total Assets
Contingent consideration liabilities- current	$	711	$	—	$	—	$	711
Contingent consideration liabilities- non-current	1,116		—		—		1,116
Total contingent consideration	$	1,827	$	—	$	—	$	1,827



	Total		Quoted Price in Active Market (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
December 31, 2018:
Short-term investments	$	29,800	$	29,800	$	—	$	—
Total Assets
Contingent consideration liabilities- current	$	129	$	—	$	—	$	129
Contingent consideration liabilities- non-current	2,367		—		—		2,367
Total contingent consideration	$	2,496	$	—	$	—	$	2,496

Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Table Text Block]



Three Months Ended September 30, 2019:	(in thousands)
Balance as of June 30, 2019	$	1,934
Contingent consideration liabilities settled	(42		)
Gain from change in fair value of contingent consideration recorded in selling, general and administrative expenses	(65		)
Fair value at September 30, 2019	$	1,827



Nine Months Ended September 30, 2019:	(in thousands)
Balance as of January 1, 2019	$	2,496
Contingent consideration liabilities settled	(98		)
Gain from change in fair value of contingent consideration recorded in selling, general and administrative expenses	(571		)
Fair value at September 30, 2019	$	1,827

EQUITY AND STOCK-BASED COMPENSATION (Tables)

9 Months Ended

Sep. 30, 2019

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

Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block]



	Three Months Ended September 30,		Nine Months Ended September 30,
	2018		2019		2018
Expected dividend yield	0	%	0	%	0	%
Risk-free interest rate	2.8	%	2.5	%	2.8	%
Expected volatility	25.6	%	30.3	%	25.6	%
Expected term (in years)	4.9		2.9		4.9

Schedule of Share-based Payment Award, Employee Stock Purchase Plan, Valuation Assumptions [Table Text Block]



	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
Expected dividend yield	0	%	0	%	0	%	0	%
Risk-free interest rate	1.9	%	2.4	%	1.4	%	2.0	%
Expected volatility	36.6	%	34.2	%	21.9	%	29.4	%
Expected term (in years)	1.3		1.3		0.7		1.3