Balance Sheet Account Detail

(a) Property and Equipment

Property and equipment consisted of the following:



	June 30, 2017			December 31, 2016
Production equipment, molds, and office furniture	$	11,908		$	11,714
Computer hardware and software	8,746			8,162
Leasehold improvements	15,495			15,495
Construction in progress (software and related implementation, production equipment, and leasehold improvements)	842			839
Property and equipment, at cost	$	36,991		$	36,210
Accumulated depreciation	(15,691		)	(12,945		)
Property and equipment, net	$	21,300		$	23,265

Depreciation expense for property and equipment for the three months ended June 30, 2017 and 2016 was $1.3 million and $1.3 million, respectively. For the six months ended June 30, 2017 and 2016 depreciation expense for property and equipment was $2.7 million and $2.6 million, respectively.

(b) Inventories

Inventories consisted of the following:



	June 30, 2017		December 31, 2016
Raw materials	$	11,291	$	13,133
Work-in-process	11,767		10,139
Finished goods	20,497		17,888
Total Inventories	$	43,555	$	41,160

The following table presents goodwill, indefinite lived intangible assets, finite lived intangible assets and related accumulated amortization:



	June 30, 2017			December 31, 2016
Goodwill	$	120,845		$	120,711

Intangible assets:
Indefinite lived intangibles
Trademarks and trade names	$	2,708		$	2,708
In-process research and development	11,200			11,200

Finite lived intangibles
Developed technology	$	67,600		$	67,600
Accumulated amortization	(5,375		)	(3,810		)
Developed technology, net	$	62,225		$	63,790

Customer relationships	$	7,500		$	7,500
Accumulated amortization	(1,063		)	(687		)
Customer relationships, net	$	6,437		$	6,813

Intangible assets (excluding goodwill), net	$	82,570		$	84,511

The change in the carrying amount of goodwill for the six months ended June 30, 2017 is as follows (in thousands):



Balance at January 1, 2017	120,711
Foreign currency translation adjustment	134
Balance at June 30, 2017	$	120,845

Amortization expense for intangible assets for the three months ended June 30, 2017 and 2016 was $1.0 million and $0.7 million, respectively. For the six months ended June 30, 2017 and 2016 amortization expense for intangible assets was $1.9 million and $1.6 million, respectively.

Estimated amortization expense for the five succeeding years and thereafter is as follows:



Remainder of 2017	$	1,940
2018	3,978
2019	3,978
2020	4,996
2021	6,557
2022 & Thereafter	47,213
Total	$	68,662

(d) Marketable securities

Investments in held-to-maturity marketable securities consist of the following at June 30, 2017 and December 31, 2016:



	June 30, 2017
	Amortized Cost		Gross Unrealized Gain		Gross Unrealized Loss			Fair Value
Agency bonds	$	3,999	$	—	$	(1	)	$	3,998
Corporate bonds	6,001		—		(2		)	5,999
Total	$	10,000	$	—	$	(3	)	$	9,997

	December 31, 2016
	Amortized Cost		Gross Unrealized Gain		Gross Unrealized Loss			Fair Value
Agency bonds	$	6,488	$	2	$	—		$	6,490
Corporate bonds	10,513		—		(21		)	10,492
Commercial paper	3,987		—		—			3,987
Total	$	20,988	$	2	$	(21	)	$	20,969

At June 30, 2017, the Company’s investments included 4 held-to-maturity debt securities in unrealized loss positions with a total unrealized loss of approximately $3 thousand and a total fair market value of approximately $10.0 million. All investments with gross unrealized losses have been in unrealized loss positions for less than 11 months. The unrealized losses were caused by interest rate fluctuations. There was no change in the credit risk of the securities. The Company does not intend to sell the securities and it is not likely that the Company will be required to sell the securities before the expected recovery of their amortized cost bases. There were no realized gains or losses on the investments for the three and six months ended June 30, 2017. All of the Company's investments of held-to-maturity securities will mature within less than 12 months with an average maturity of 1 month.

(e) Fair Value Measurements

The following fair value hierarchy table presents information about each major category of the Company’s assets and liabilities measured at fair value on a recurring basis as of June 30, 2017 and December 31, 2016:



	Fair value measurement at reporting date using:
	Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)		Total
At June 30, 2017
Cash and cash equivalents	$	81,641	$	—	$	—	$	81,641
Restricted cash	$	2,877	$	—	$	—	$	2,877
Contingently issuable common stock	$	—	$	—	$	9,600	$	9,600
At December 31, 2016
Cash and cash equivalents	$	26,120	$	—	$	—	$	26,120
Restricted cash	$	2,001	$	—	$	—	$	2,001
Contingently issuable common stock	$	—	$	—	$	12,200	$	12,200

There were no re-measurements to fair value during the six months ended June 30, 2017 of financial assets and liabilities that are not measured at fair value on a recurring basis. There were no transfers between Level 1, Level 2 or Level 3 securities during the six months ended June 30, 2017.

(f) Financial Instruments Not Recorded at Fair Value on a Recurring Basis

The Company measures the fair value of its 2.25% Convertible Senior Notes due 2018 and 3.25% Convertible Senior Notes due 2020 (collectively, the “Senior Notes”) carried at amortized cost quarterly for disclosure purposes. The estimated fair value of the Senior Notes is determined by Level 2 inputs and is based primarily on quoted market prices for the same or similar securities. Based on the market prices, the fair value of our long-term debt was $123.2 million as of June 30, 2017 and $187.6 million as of December 31, 2016.

The Company measures the fair value of its Term Loan carried at amortized cost quarterly for disclosure purposes. The estimated fair value of the Term Loan is determined by Level 3 inputs and is based primarily on unobservable inputs that are not corroborated by market data. The fair value of our Term Loan was $100.2 million as of June 30, 2017.

Due to short-term nature, the Company believes that the carrying value of its revolving line of credit approximated its fair value at June 30, 2017.

The Company measures the fair value of its held-to-maturity marketable securities carried at amortized cost quarterly for disclosure purposes. The fair value of marketable securities is determined by Level 2 inputs and is based primarily on quoted market prices for the same or similar instruments.