View Filing Data

Research, development and clinical trials

^[1]

$ 3,391

$ 5,666

$ 10,921

$ 10,342

Cost of revenue

1,482

2,333

4,152

4,436

Gross profit

1,909

3,333

6,769

5,906

Operating expenses:

3,903

4,787

10,128

8,669

Selling, general and administrative

5,867

6,251

12,519

10,904

Total operating expenses

9,770

11,038

22,647

19,573

Loss from operations

(7,861)

(7,705)

(15,878)

(13,667)

Other income (expense):

Interest expense

(1,001)

(1,113)

(2,043)

(2,206)

Change in fair value of preferred stock warrant liability

(614)

(341)

Other income (expense), net

371

247

588

144

Total other expense, net

(630)

(1,480)

(1,455)

(2,403)

Loss before income taxes

(8,491)

(9,185)

(17,333)

(16,070)

Provision for income taxes

(6)

(10)

(16)

(20)

Net loss

$ (8,497)

$ (9,195)

$ (17,349)

$ (16,090)

Net loss per share attributable to common stockholders, basic and diluted

$ (0.36)

$ (0.70)

$ (0.78)

$ (2.21)

Weighted average common shares outstanding, basic and diluted

23,330,918

13,133,834

22,259,047

7,277,237

[1]	Net revenue by country is categorized based on the location of the end customer.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 29, 2019	Jun. 30, 2020	Jun. 29, 2019
Statement Of Income And Comprehensive Income [Abstract]
Net loss	$ (8,497)	$ (9,195)	$ (17,349)	$ (16,090)
Other comprehensive income (loss):
Foreign currency translation adjustment	(42)	(21)	(26)	13
Unrealized gains (losses) on marketable securities, net of tax of $0	(149)	30	64	30
Total other comprehensive income (loss)	(191)	9	38	43
Comprehensive loss	$ (8,688)	$ (9,186)	$ (17,311)	$ (16,047)

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

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Amount after tax and reclassification adjustments of other comprehensive income (loss).

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Paraethetical) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 29, 2019	Jun. 30, 2020	Jun. 29, 2019
Statement Of Income And Comprehensive Income [Abstract]
Other Comprehensive Income (Loss), Securities, Available-for-Sale, Unrealized Holding Gain (Loss) Arising During Period, Tax	$ 0	$ 0	$ 0	$ 0

CONSOLIDATED STATEMENTS OF CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY (DEFICIT) - USD ($) $ in Thousands	Total	Convertible Preferred Stock [Member]	Common Stock [Member]	Additional Paid-in Capital [Member]	Accumulated Other Comprehensive Income (Loss) [Member]	Accumulated Deficit [Member]
Balance at Dec. 29, 2018	$ (192,242)	$ 186,519	$ 1	$ 143,794	$ (101)	$ (335,936)
Balance, Shares at Dec. 29, 2018		50,404,140	1,397,493
Issuance of common stock upon the exercise of common stock options	8			8
Issuance of common stock upon the exercise of common stock options, Shares			29,180
Stock-based compensation expense	57			57
Foreign currency translation adjustment	34				34
Net loss	(6,895)					(6,895)
Balance at Mar. 30, 2019	(199,038)	$ 186,519	$ 1	143,859	(67)	(342,831)
Balance, Shares at Mar. 30, 2019		50,404,140	1,426,673
Balance at Dec. 29, 2018	(192,242)	$ 186,519	$ 1	143,794	(101)	(335,936)
Balance, Shares at Dec. 29, 2018		50,404,140	1,397,493
Foreign currency translation adjustment	13
Unrealized gains (losses) on marketable securities, net of tax of $0	30
Net loss	(16,090)
Balance at Jun. 29, 2019	71,161		$ 423,245		(58)	(352,026)
Balance, Shares at Jun. 29, 2019			21,098,368
Balance at Mar. 30, 2019	(199,038)	$ 186,519	$ 1	143,859	(67)	(342,831)
Balance, Shares at Mar. 30, 2019		50,404,140	1,426,673
Conversion of convertible preferred stock into common stock upon initial public offering	186,519	$ (186,519)	$ 186,519
Conversion of convertible preferred stock into common stock upon initial public offering, Shares		(50,404,140)	13,119,424
Conversion of TransMedics' common stock into TransMedics Group's common stock upon corporate reorganization			$ 143,859	$ (143,859)
Conversion of preferred stock warrants into common stock warrants upon initial public offering	1,239		1,239
Issuance of common stock in initial public offering,net of discounts and issuance costs	91,401		$ 91,401
Issuance of common stock in initial public offering,net of discounts and issuance costs, Shares			6,543,500
Issuance of common stock upon the exercise of common stock options	6		$ 6
Issuance of common stock upon the exercise of common stock options, Shares			8,771
Stock-based compensation expense	220		$ 220
Foreign currency translation adjustment	(21)				(21)
Unrealized gains (losses) on marketable securities, net of tax of $0	30				30
Net loss	(9,195)					(9,195)
Balance at Jun. 29, 2019	71,161		$ 423,245		(58)	(352,026)
Balance, Shares at Jun. 29, 2019			21,098,368
Balance at Dec. 28, 2019	54,649		$ 424,134		(2)	(369,483)
Balance, Shares at Dec. 28, 2019			21,184,524
Issuance of common stock upon the exercise of common stock options	75		$ 75
Issuance of common stock upon the exercise of common stock options, Shares			146,793
Issuance of common stock in connection with employee stock purchase plan	197		$ 197
Issuance of common stock in connection with employee stock purchase plan , Shares			12,163
Stock-based compensation expense	385		$ 385
Foreign currency translation adjustment	16				16
Unrealized gains (losses) on marketable securities, net of tax of $0	213				213
Net loss	(8,852)					(8,852)
Balance at Mar. 31, 2020	46,683		$ 424,791		227	(378,335)
Balance, Shares at Mar. 31, 2020			21,343,480
Balance at Dec. 28, 2019	54,649		$ 424,134		(2)	(369,483)
Balance, Shares at Dec. 28, 2019			21,184,524
Foreign currency translation adjustment	(26)
Unrealized gains (losses) on marketable securities, net of tax of $0	64
Net loss	(17,349)
Balance at Jun. 30, 2020	113,760		$ 500,556		36	(386,832)
Balance, Shares at Jun. 30, 2020			27,136,362
Balance at Mar. 31, 2020	46,683		$ 424,791		227	(378,335)
Balance, Shares at Mar. 31, 2020			21,343,480
Issuance of common stock in initial public offering,net of discounts and issuance costs	75,042		$ 75,042
Issuance of common stock in initial public offering,net of discounts and issuance costs, Shares			5,750,000
Issuance of common stock upon the exercise of common stock options	92		$ 92
Issuance of common stock upon the exercise of common stock options, Shares			42,882
Stock-based compensation expense	631		$ 631
Foreign currency translation adjustment	(42)				(42)
Unrealized gains (losses) on marketable securities, net of tax of $0	(149)				(149)
Net loss	(8,497)					(8,497)
Balance at Jun. 30, 2020	$ 113,760		$ 500,556		$ 36	$ (386,832)
Balance, Shares at Jun. 30, 2020			27,136,362

CONSOLIDATED STATEMENTS OF CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY (DEFICIT) (Parenthetical) - USD ($) $ in Thousands	3 Months Ended
	Jun. 30, 2020	Jun. 29, 2019
Statement Of Stockholders Equity [Abstract]
Discounts and issuance costs of stock issued	$ 628	$ 5,966

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2020	Jun. 29, 2019	Jun. 30, 2020	Jun. 29, 2019	Dec. 28, 2019
Cash flows from operating activities:
Net loss			$ (17,349)	$ (16,090)	$ (33,500)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization expense			745	534
Stock-based compensation expense			1,016	277
Change in fair value of preferred stock warrant liability	$ 0	$ 614		341
Non-cash interest expense and end of term accretion expense			249	231
Net amortization (accretion) of premiums (discounts) on marketable securities			49	(24)
Unrealized foreign currency transaction losses			(131)
Changes in operating assets and liabilities:
Accounts receivable			2,135	(3,681)
Inventory			(1,409)	(3,226)
Prepaid expenses and other current assets			(324)	259
Accounts payable			(3,827)	1,442
Accrued expenses and other current liabilities			660	816
Deferred revenue			848	(130)
Deferred rent			623	(174)
Net cash used in operating activities			(16,715)	(19,425)
Cash flows from investing activities:
Purchases of property and equipment			(397)	(151)
Purchases of marketable securities			(63,637)	(48,945)
Proceeds from sales and maturities of marketable securities			36,025
Net cash used in investing activities			(28,009)	(49,096)
Cash flows from financing activities:
Payments of public offering costs and other financing costs			(339)	(1,980)
Proceeds from issuance of common stock in public offering, net of underwriting discounts and commissions			75,670	97,367
Proceeds from issuance of common stock upon exercise of stock options			167	10
Proceeds from issuance of common stock in connection with employee stock purchase plan			197
Proceeds from Paycheck Protection Program loan			2,249
Repayment of Paycheck Protection Program loan			(2,249)
Net cash provided by financing activities			75,695	95,397
Effect of exchange rate changes on cash, cash equivalents and restricted cash			89	125
Net increase in cash, cash equivalents and restricted cash			31,060	27,001
Cash, cash equivalents and restricted cash, beginning of period			20,592	20,741
Cash, cash equivalents and restricted cash, end of period	51,652	47,742	51,652	47,742	20,592
Supplemental disclosure of non-cash investing and financing activities:
Transfers of inventory to property and equipment			78	1,263
Reclassification of warrants to additional paid-in capital				(1,239)
Purchases of property and equipment included in accounts payable			47	19
Offering costs included in accounts payable and accrued expenses			409	1,381
Reconciliation of cash, cash equivalents and restricted cash:
Cash and cash equivalents	51,152	47,242	51,152	47,242	20,092
Restricted cash	500	500	500	500
Cash, cash equivalents and restricted cash, end of period	$ 51,652	$ 47,742	$ 51,652	$ 47,742	$ 20,592

Nature of the Business and Basis of Presentation

6 Months Ended

Jun. 30, 2020

Nature of the Business and Basis of Presentation

1. Nature of the Business and Basis of Presentation

TransMedics Group, Inc. (“TransMedics Group” and, together with its consolidated subsidiaries, the “Company”) was incorporated in the Commonwealth of Massachusetts in October 2018. TransMedics, Inc. (“TransMedics”), an operating company and wholly owned subsidiary of TransMedics Group, was incorporated in the State of Delaware in August 1998. The Company is a commercial-stage medical technology company transforming organ transplant therapy for end-stage organ failure patients across multiple disease states. The Company developed the Organ Care System (“OCS”) to replace a decades-old standard of care. The OCS represents a paradigm shift that transforms organ preservation for transplantation from a static state to a dynamic environment that enables new capabilities, including organ optimization and assessment. The Company’s OCS technology replicates many aspects of the organ’s natural living and functioning environment outside of the human body.

On May 6, 2019, immediately prior to the closing of the Company’s initial public offering (the “IPO”), the Company completed a corporate reorganization whereby TransMedics, the direct parent of TransMedics Group prior to the corporate reorganization, became a direct, wholly-owned subsidiary of TransMedics Group pursuant to the merger of TMDX, Inc., a direct, wholly-owned subsidiary of TransMedics Group prior to the corporate reorganization, with and into TransMedics, with TransMedics as the surviving corporation. Pursuant to the terms of an agreement and plan of merger and reorganization, as a result of the merger, each outstanding share of common stock of TransMedics was converted into shares of common stock of TransMedics Group on a 3.5-for-one basis, each outstanding share of convertible preferred stock of TransMedics was converted into shares of common stock of TransMedics Group based on the conversion ratio of each individual series of preferred stock, as defined in the certificate of incorporation of TransMedics prior to the conversion, and the 3.5-for-one ratio on which shares of common stock of TransMedics were converted into common stock of TransMedics Group; each outstanding option to purchase shares of common stock of TransMedics was converted into an outstanding option to purchase shares of common stock of TransMedics Group adjusted on a 3.5-for-one basis, with a corresponding adjustment to the exercise price; and each outstanding warrant to purchase shares of preferred stock of TransMedics was converted into a warrant to purchase shares of common stock of TransMedics Group adjusted on a 3.5-for-one basis, with a corresponding adjustment to the exercise price. This is referred to as the “Corporate Reorganization.”

All share and per share amounts for all periods presented in the accompanying consolidated financial statements and notes thereto have been adjusted retroactively, where applicable, to reflect the 3.5-for-one conversion ratio applied to common stock in the Corporate Reorganization.

Immediately following the Corporate Reorganization, (i) TransMedics Group became a holding company with no material assets other than 100% of the equity interests in TransMedics, (ii) the holders of capital stock in TransMedics became shareholders of TransMedics Group and (iii) the historical consolidated financial statements of TransMedics became the historical consolidated financial statements of TransMedics Group because the Corporate Reorganization was accounted for as a reorganization of entities under common control. Prior to the Corporate Reorganization, TransMedics Group had not conducted any activities other than in connection with its formation and in preparation for the IPO and had no material assets other than 100% of the equity interests in TMDX, Inc.

On May 6, 2019, the Company completed its IPO, pursuant to which it issued and sold 6,543,500 shares of common stock, inclusive of 853,500 shares sold by the Company pursuant to the full exercise of the underwriters’ option to purchase additional shares. The aggregate net proceeds received by the Company from the IPO were $91.4 million, after deducting underwriting discounts and commissions as well as other offering costs of $6.0 million.

On May 26, 2020, the Company completed an underwritten public offering of 5,750,000 shares of its common stock, inclusive of 750,000 shares sold by the Company pursuant to the full exercise of the underwriters’ option to purchase additional shares. The aggregate net proceeds received by the Company from the offering were approximately $75.0 million, after deducting underwriting discounts and commissions as well as other offering costs of $0.6 million.

The accompanying consolidated financial statements have been prepared on the basis of continuity of operations, realization of assets and the satisfaction of liabilities and commitments in the ordinary course of business. The Company has incurred recurring losses since inception, including net losses attributable to the Company of $17.3 million for the fiscal six months ended June 30, 2020 and $33.5 million for the fiscal year ended December 28, 2019. As of June 30, 2020, the Company had an accumulated deficit of $386.8 million. The Company expects to continue to generate operating losses in the foreseeable future.

The Company believes that its existing cash, cash equivalents, and marketable securities of $139.4 million as of June 30, 2020 will be sufficient to fund its operations, capital expenditures, and debt service payments for at least the next 12 months following the filing of this Quarterly Report on Form 10-Q. The Company may need to seek additional funding through equity financings, debt financings or strategic alliances. The Company may not be able to obtain financing on acceptable terms, or at all, and the terms of any financing may adversely affect the holdings or the rights of the Company’s shareholders. If the Company is unable to obtain funding, the Company will be required to delay, reduce or eliminate some or all of its research and development programs, product expansion or commercialization efforts, or the Company may be unable to continue operations.

The Company is subject to risks and uncertainties common to companies in the medical device industry and of similar size, including, but not limited to, development by competitors of new technological innovations, dependence on key personnel, protection of proprietary technology, compliance with government regulations, uncertainty of market acceptance of products, and the need to obtain additional financing to fund operations. Potential risks and uncertainties also include, without limitation, uncertainties regarding the duration and magnitude of the impact of the COVID-19 pandemic on the Company’s business and the economy generally. Products currently under development will require additional research and development efforts, including additional clinical testing and regulatory approval, prior to commercialization. These efforts require additional capital, adequate personnel, infrastructure and extensive compliance-reporting capabilities. The Company’s research and development may not be successfully completed, adequate protection for the Company’s technology may not be obtained, the Company may not obtain necessary government regulatory approval, and approved products may not prove commercially viable. The Company operates in an environment of rapid change in technology and competition.

In December 2019, a novel strain of coronavirus (COVID-19) emerged in Wuhan, Hubei Province, China. Less than four months later, in March 2020, the World Health Organization declared COVID-19 a pandemic, and the virus has now spread to many other countries and regions and every state within the United States, including Massachusetts, where the Company’s primary offices and manufacturing facilities are located. The impact of this pandemic has been and will likely continue to be extensive in many aspects of society, which has resulted in and will likely continue to result in significant disruptions to the global economy, as well as businesses and capital markets around the world.

Impacts to the Company’s business as a result of COVID-19 include the temporary disruption of transplant procedures at many of the organ transplant centers that purchase OCS products; disruptions to the Company’s manufacturing operations and supply chain caused by facility closures, reductions in operating hours, staggered shifts and other social distancing efforts; labor shortages; decreased productivity and unavailability of materials or components; restrictions on or delays of the Company’s clinical trials and studies; limitations on its employees’ and customers’ ability to travel, and delays in product installations, trainings or shipments to and from affected countries and within the United States. In response to the pandemic, healthcare providers have, and may need to further, reallocate resources, such as physicians, staff, hospital beds and intensive care unit facilities, and these actions significantly delay the provision of other medical care such as organ transplantation and reduce the number of transplant procedures that are performed, which negatively impacts the Company’s revenue and clinical trial activities. The Company’s sales and clinical adoption team is also operating at reduced capacity and restricted in visiting many transplant centers in person. In addition, the Company had temporarily reduced the manufacturing and distribution of its OCS products at its facility in Andover, Massachusetts. Starting in May 2020, the Company resumed manufacturing and distribution operations to pre-COVID levels. While the Company maintains an inventory of finished products and raw materials used in its OCS products, a prolonged pandemic could lead to shortages in the raw materials necessary to manufacture its products. The Company plans to maintain these or similar restrictions until it believes employees can fully resume such activities in accordance with federal, state and local requirements. The COVID-19 pandemic has impacted regulatory timelines, including with respect to the Company’s OCS Heart Pre-Market Approval (“PMA”) application, and may affect other potential PMA applications.

While the COVID-19 pandemic did not significantly impact the Company’s business or results of operations during the first quarter of 2020, OCS product sales were negatively impacted by the COVID-19 pandemic in the second quarter of 2020 and the Company anticipates a negative impact to OCS product sales for the remainder of 2020; however, the length and extent of the pandemic, its consequences, and containment efforts will determine the future impact on the Company’s operations and financial condition.

Prior to 2020, the Company’s fiscal year ended on the last Saturday in December, and the Company reported fiscal years using a 52/53-week convention. Under this convention, certain fiscal years contained 53 weeks. Each fiscal year was typically composed of four 13-week fiscal quarters, but in years with 53 weeks, the fourth quarter was a 14-week period. The fiscal year ended December 28, 2019 included 52 weeks. In February 2020, the Company changed the end of its fiscal year end from the last Saturday in December to December 31. As a result of this change, the Company’s current fiscal year will end on December 31, 2020 and its current and each subsequent fiscal quarter will end on March 31, June 30 and September 30.

The Company’s consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”). Any reference in these notes to applicable guidance is meant to refer to the authoritative GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Update (“ASU”) of the Financial Accounting Standards Board (“FASB”). The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.

Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2020

Summary of Significant Accounting Policies

2. Summary of Significant Accounting Policies

Unaudited Interim Financial Information

The accompanying unaudited interim financial statements and related notes have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial statements. Certain information and footnote disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. These consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto for the fiscal year ended December 28, 2019 included in the Company’s Annual Report on Form 10-K on file with the SEC. In the opinion of management, all adjustments, consisting only of normal recurring adjustments necessary for a fair statement of the Company’s financial position as of June 30, 2020 and results of operations for the fiscal three and six months ended June 30, 2020 and June 29, 2019 and cash flows for the fiscal six months ended in the same periods have been made. The Company’s results of operations for the fiscal three and six months ended June 30, 2020 are not necessarily indicative of the results of operations that may be expected for the year ending December 31, 2020.

Use of Estimates

The preparation of 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 assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting periods. Significant estimates and assumptions reflected in these consolidated financial statements include, but are not limited to, revenue recognition, the valuation of inventory and the valuation of stock-based awards. The Company bases its estimates on historical experience, known trends and other market-specific or other relevant factors that it believes to be reasonable under the circumstances. On an ongoing basis, management evaluates its estimates as there are changes in circumstances, facts and experience. Changes in estimates are recorded in the period in which they become known. The full extent to which the COVID-19 pandemic will directly or indirectly impact the Company’s business, results of operations and financial condition, including sales, expenses, reserves and allowances, manufacturing, clinical trials, research and development costs and employee-related amounts, will depend on future developments that are highly uncertain, including as a result of new information that may emerge concerning COVID-19 and the actions taken to contain it or treat COVID-19, as well as the economic impact on local, regional, national and international customers and markets. The Company has made estimates of the impact of COVID-19 within its financial statements and there may be changes to those estimates in future periods. As of the date of issuance of these unaudited consolidated financial statements, the Company is not aware of any specific event or circumstance that would require the Company to update estimates, judgments or revise the carrying value of any assets or liabilities. Actual results may differ from those estimates or assumptions.

Risk of Concentrations of Credit, Significant Customers and Significant Suppliers

Financial instruments that potentially expose the Company to concentrations of credit risk consist primarily of cash, cash equivalents, marketable securities, and accounts receivable. The Company has not experienced any other-than-temporary losses with respect to its cash, cash equivalents, and marketable securities and does not believe that it is subject to unusual credit risk beyond the normal credit risk associated with commercial banking relationships.

Significant customers are those that accounted for 10% or more of the Company’s net revenue or accounts receivable. For the fiscal three and six months ended June 30, 2020, one customer represented 17% and 11% of net revenue, respectively. For the fiscal three and six months ended June 29, 2019, one customer represented 17% and 12% of net revenue, respectively. As of June 30, 2020 and December 28, 2019, no customer accounted for 10% or more of accounts receivable.

Certain of the components and subassemblies included in the Company’s products are obtained from a sole source, a single source or a limited group of suppliers. Although the Company seeks to reduce dependence on those limited sources of suppliers and manufacturers, the partial or complete loss of certain of these sources could have a material adverse effect on the Company’s operating results, financial condition and cash flows and damage its customer relationships.

Fair Value Measurements

Certain assets and liabilities are carried at fair value under GAAP. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. Financial assets and liabilities carried at fair value are to be classified and disclosed in one of the following three levels of the fair value hierarchy, of which the first two are considered observable and the last is considered unobservable:

•

Level 1—Quoted prices in active markets for identical assets or liabilities.

•

Level 2—Observable inputs (other than Level 1 quoted prices), such as quoted prices in active markets for similar assets or liabilities, quoted prices in markets that are not active for identical or similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market data.

•

Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to determining the fair value of the assets or liabilities, including pricing models, discounted cash flow methodologies and similar techniques.

The Company’s cash equivalents and marketable securities are carried at fair value, determined according to the fair value hierarchy described above (see Note 4). The carrying values of the Company’s accounts receivable, accounts payable and accrued expenses approximate their fair values due to the short-term nature of these assets and liabilities. The carrying value of the Company’s long-term debt approximates its fair value at each balance sheet date due to its variable interest rate, which approximates a market interest rate.

Marketable Securities

The Company’s marketable securities (non-equity instruments) are classified as available-for-sale and are carried at fair value, with the unrealized gains and losses reported as a component of accumulated other comprehensive income (loss) in stockholders’ equity (deficit). Realized gains and losses and declines in value determined to be other than temporary are based on the specific identification method and are included as a component of other income (expense), net in the consolidated statements of operations.

The Company evaluates its marketable securities with unrealized losses for other-than-temporary impairment. When assessing marketable securities for other-than-temporary declines in value, the Company considers such factors as, among other things, how significant the decline in value is as a percentage of the original cost, how long the market value of the investment has been less than its original cost, the Company’s ability and intent to retain the investment for a period of time sufficient to allow for any anticipated recovery in fair value and market conditions in general. If any adjustment to fair value reflects a decline in the value of the investment that the Company considers to be “other than temporary,” the Company reduces the investment to fair value through a charge recorded in the consolidated statements of operations. No such adjustments were necessary during the periods presented.

Revenue Recognition

The Company generates revenue primarily from sales of its single-use, organ-specific disposable sets (i.e., its organ-specific OCS Perfusion Sets sold together with its organ-specific OCS Solutions) used on its organ-specific OCS Consoles, each being a component of the Company’s OCS products. To a lesser extent, the Company also generates revenue from the sale of OCS Consoles to customers and from the implied rental of OCS Consoles loaned to customers at no charge. For each new transplant procedure, customers purchase an additional OCS disposable set for use on the customer’s existing organ-specific OCS Console.

The Company recognizes revenue from sales to customers applying the following five steps: (1) identification of the contract, or contracts, with a customer, (2) identification of the performance obligations in the contract, (3) determination of the transaction price, (4) allocation of the transaction price to the performance obligations in the contract, and (5) recognition of revenue when, or as, performance obligations are satisfied. Because all performance obligations of a customer order are delivered and recognized as revenue at the same time and because revenue allocated to performance obligations other than OCS disposable sets, such as implied rental income and service revenue, is insignificant, all components of revenue from customer arrangements are classified as a single category of revenue in the Company’s consolidated statements of operations.

Substantially all of the Company’s customer contracts have multiple-performance obligations that contain deliverables consisting of OCS Perfusion Sets and OCS Solutions. In some of those customer contracts, the deliverables also include an OCS Console, whether sold or loaned to the customer. The Company evaluates each promise within a multiple-performance obligation arrangement to determine whether it represents a distinct performance obligation. A performance obligation is distinct if (1) the product or service is separately identifiable from other promises in the contract and (2) the customer can benefit from the product or service on its own or with other resources that are readily available to the customer.

When a customer order includes an OCS Console, whether sold or loaned, the Company has determined that customer training and the equipment set-up of the OCS Console, each performed by the Company, are not distinct because they are not sold on a standalone basis and can only be performed by the Company in conjunction with a sale or loan of its OCS Console. In addition, the Company has determined that the OCS Console itself is not distinct because the customer cannot benefit from the OCS Console without the training and equipment set-up having been completed. As a result, when the order includes an OCS Console, the Company has concluded that training, OCS Console equipment set-up, and the OCS Console itself are highly interdependent and represent a single, combined performance obligation. Consequently, the Company does not recognize any revenue from any component of a customer order that includes an OCS Console, whether sold or loaned, until the OCS Console has arrived at the customer site and the training and equipment set-up have been completed by the Company. The Company has concluded that “transfer of control” of an OCS Console occurs only after the console has arrived at the customer site and the training and equipment set-up have been completed by the Company.

Some of the Company’s revenue has been generated from products sold in conjunction with the clinical trials conducted for the Company’s OCS products, under arrangements referred to as customer clinical trial agreements. Under most of these customer clinical trial agreements, the Company places an organ-specific OCS Console at the customer site for its use free of charge for the duration of the clinical trial, and the customer separately purchases from the Company the OCS disposable sets used in each transplant procedure during the clinical trial. When the Company loans the OCS Console to the customer, it retains title to the console at all times and does not require minimum purchase commitments from the customer related to any OCS products. In such cases, the Company invoices the customer for OCS disposable sets based on customer orders received for each new transplant procedure and the prices set forth in the customer agreement. Over time, the Company typically recovers the cost of the loaned OCS Console through the customer’s continued purchasing and use of additional OCS disposable sets. For these reasons, the Company has determined that part of the arrangement consideration for the disposable set is an implied rental payment for use of the OCS Console.

When the Company’s customer arrangements have multiple-performance obligations that contain a loan of an OCS Console for the customer’s use at its customer site as well as OCS disposable sets that are delivered simultaneously, the Company allocates the arrangement consideration between the lease deliverables (i.e., the OCS Console) and non-lease deliverables (i.e., the OCS disposable sets) based on the relative estimated standalone selling price (“SSP”) of each distinct performance obligation. To date, the amounts allocated to lease deliverables have been insignificant. In determining SSP, the Company maximizes observable inputs and consider a number of data points, including: (1) the pricing of standalone sales (in instances where available), (2) the pricing established by management when setting prices for deliverables that are intended to be sold on a standalone basis, (3) contractually stated prices for deliverables that are intended to be sold on a standalone basis, and (4) other pricing factors, such as the geographical region in which the products are sold and expected discounts based on the customer size and type.

Revenue is recognized when control of the OCS product or products is transferred to the customer in an amount that reflects the consideration the Company expects to be entitled to in exchange for the product or products.

Performance Obligations

The primary performance obligations in the Company’s customer arrangements from which it derives revenue are as follows:

•

OCS Console — The OCS Console is a medical device that houses and controls the function of the OCS. The performance obligation of the OCS Console includes customer training and equipment set-up. Revenue for each OCS Console is recognized at the point in time at which control is transferred to the customer, which is typically only after the console has arrived at the customer site and the training and equipment set-up have been completed by the Company because the customer cannot benefit from the OCS Console without the training and equipment set-up having been completed. At that time, the Company believes that the customer has the significant risks and rewards of ownership.

•

OCS Perfusion Set — The OCS Perfusion Set is a single-use disposable set that stores the organ and circulates blood. Revenue for each OCS Perfusion Set is recognized at the point in time at which control is transferred to the customer, which is when title transfers to the customer in connection with delivery. In most of the Company’s customer arrangements, title to the OCS Perfusion Set transfers when the OCS Perfusion Set arrives at the customer site. In limited instances, title transfers upon shipment to the customer by the Company.

•

OCS Solutions — The OCS Solutions are a set of nutrient-enriched solutions to optimize the organ’s condition outside the human body. Revenue for each OCS Solution is recognized at the point in time at which control is transferred to the customer, which is when title transfers to the customer in connection with delivery. In most of the Company’s customer arrangements, title to the OCS Solutions transfers when the OCS Solutions arrive at the customer site. In limited instances, title transfers upon shipment to the customer by the Company.

Payments Made to Customers

Under the Company’s customer arrangements that include a customer clinical trial agreement, the Company receives payments from sales to the customer of its OCS products and also makes payments to that customer for reimbursements of clinical trial costs, materials, and for specified clinical documentation related to the customer’s use of its OCS products. The Company also makes payments to customers involved in post-approval studies for information related to the transplant procedures performed. The Company determines the appropriate accounting treatments for these payments depending on the nature of the payment and whether they are for distinct goods or services.

The Company has determined that the payments made to the customer for reimbursement of clinical trial materials and customer’s costs incurred to execute specific clinical trial protocols related to the Company’s OCS products do not provide the Company with a distinct good or service transferred by the customer, and therefore such payments are recorded as a reduction of revenue from the customer in the Company’s consolidated statements of operations. Reductions of revenue related to such payments made to customers for reimbursements are recognized when the Company recognizes the revenue for the sale of its OCS disposable sets. The Company recorded the reimbursable clinical costs as a reduction of revenue of $0.5 million and $1.2 million for the fiscal three and six months ended June 30, 2020, respectively, and $0.5 million and $1.2 million for the fiscal three and six months ended June 29, 2019, respectively, as presented below in disaggregated revenue.

The Company has also determined that payments made to customers to obtain information related to post-approval studies or existing standard-of-care protocols (i.e., unrelated to the Company’s OCS products) do meet the criteria to be classified as a cost because the Company receives a distinct good or service transferred by the customer separate from the customer’s purchase of the Company’s OCS products and the consideration paid represents the fair value of the distinct good or service received by the Company. As a result, these payments made to the customers for information related to post-approval studies or standard-of-care protocols are recorded as research, development, and clinical trials expenses. The Company recorded payments made to customers related to post-approval studies and for documentation related to existing standard-of-care protocols of $0.4 million and $0.8 million for the fiscal three and six months ended June 30, 2020, respectively, and $0.3 million and $0.5 million for the fiscal three and six months ended June 29, 2019, respectively, as research, development, and clinical trials expenses.

Variable Consideration

Revenue is reported net of any taxes assessed by a governmental authority that are directly imposed on a revenue-producing transaction (e.g., sales, use, and value added taxes). The Company only includes estimated variable amounts in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved.

Revenue from reimbursements of out-of-pocket expenses, including travel, lodging, and meals, is accounted for as variable consideration.

The Company does not consider shipping to be a contract performance obligation. The Company records shipping costs billed to customers as revenue and records the associated costs incurred by the Company for those items as cost of revenue.

Contract Assets and Liabilities

The Company recognizes a receivable at the point in time at which it has an unconditional right to payment. Such receivables are not contract assets. Payment terms for customer orders, including for each of the Company’s primary performance obligations, are typically 30 days for customers in the United States and 30 to 90 days for customers in non-U.S. markets, and such payments do not include payments that are variable, dependent on specified factors or events.

Contract assets arise from unbilled amounts in customer arrangements when revenue recognized exceeds the amount billed to the customer and the Company’s right to payment is not just subject to the passage of time. The Company had no contract assets as of June 30, 2020 and December 28, 2019.

Contract liabilities represent the Company’s obligation to transfer goods or services to a customer for which it has received consideration (or the amount is due) from the customer. The Company has determined that its only contract liabilities are deferred revenue, which consists of amounts that have been invoiced but that have not been recognized as revenue.

The Company generally satisfies performance obligations within one year of the contract inception date. As of June 30, 2020, the Company’s wholly- or partially-unsatisfied performance obligations totaled $2.9 million and are expected to be completed within the next year.

Disaggregated Revenue

In determining total net revenue under the revenue recognition guidance applicable to both periods presented, the Company reduces revenue by the amount of certain payments made to customers (see “Payments Made to Customers” above). The reconciliation of gross revenue to net revenue for these certain payments is shown below (in thousands):

	Fiscal Three Months Ended				Fiscal Six Months Ended
	June 30, 2020		June 29, 2019		June 30, 2020		June 29, 2019
Gross revenue from sales to customers	$	3,923	$	6,215	$	12,166	$	11,505
Less: clinical trial payments reducing revenue		532		549		1,245		1,163
Total net revenue	$	3,391	$	5,666	$	10,921	$	10,342

The Company disaggregates revenue from contracts with customers by product type and geographical area as it believes this presentation best depicts how the nature, amount, timing and uncertainty of the Company’s revenue and cash flows are affected by economic factors, as shown below (in thousands):

	Fiscal Three Months Ended				Fiscal Six Months Ended
	June 30, 2020		June 29, 2019		June 30, 2020		June 29, 2019
Net revenue by OCS product:
OCS Lung net revenue	$	435	$	2,219	$	2,443	$	3,631
OCS Heart net revenue		2,220		2,643		6,351		4,565
OCS Liver net revenue		736		804		2,127		2,146
Total net revenue	$	3,391	$	5,666	$	10,921	$	10,342

	Fiscal Three Months Ended				Fiscal Six Months Ended
	June 30, 2020		June 29, 2019		June 30, 2020		June 29, 2019
Net revenue by country:
United States	$	2,440	$	4,302	$	7,648	$	7,255
United Kingdom		355		405		1,467		974
All other countries		596		959		1,806		2,113
Total net revenue	$	3,391	$	5,666	$	10,921	$	10,342

Other Revenue Considerations

The Company does not assess whether promised goods or services are performance obligations if they are deemed immaterial in the context of the contract with the customer. Additionally, the Company does not assess whether a contract has a significant financing component if the expectation at contract inception is that the period between payment by the customer and the transfer of the promised goods or services to the customer will be one year or less. The Company does not consider shipping to be a contract performance obligation.

Distributors

The Company markets and sells its products primarily through its direct sales force, which sells its products to end customers globally. A small portion of the Company’s revenue is generated by sales to a limited number of distributors in Europe and Asia-Pacific. When the Company transacts with a distributor, its contractual arrangement is with the distributor and not with the end customer. Whether the Company transacts business with and receives the order from a distributor or directly from an end customer, its revenue recognition policy and resulting pattern of revenue recognition for the order are the same.

In its business with distributors, the Company enters into a distributor agreement under which the distributor places orders to the Company for its products in connection with the distributor’s own sales to identified end customers, and the Company confirms the identification of the end customer prior to accepting each order. The Company’s distributors do not stock OCS Consoles purchased from the Company and stock only minimal quantities of OCS disposable sets. Under these contractual arrangements, the Company invoices the distributor for the selling price (which reflects a distributor discount relative to typical end customer pricing) and payment to the Company from the distributor is not contingent upon the distributor’s collection from the end customer. The Company records revenue based on the amount of the discounted selling price.

When a sale to a distributor includes an OCS Console, the Company performs the training and OCS Console equipment set-up for the end customer. The Company recognizes no revenue from a distributor order that includes an OCS Console until the OCS Console has arrived at the customer site and the training and equipment set-up have been completed by the Company.

Stock-Based Compensation

The Company measures stock-based option awards granted to employees, non-employees and directors based on their fair value on the date of grant using the Black-Scholes option-pricing model. Generally, the Company issues awards with only service-based vesting conditions. Compensation expense for those awards is recognized over the vesting period of the respective award using the straight-line method. The Company accounts for forfeitures as they occur and records compensation cost assuming all option holders will complete the requisite service period. When the unvested portion of an award is forfeited, the Company reverses compensation expense previously recognized in the period of the forfeiture.

The Company classifies stock-based compensation expense in its consolidated statements of operations in the same manner in which the award recipient’s payroll costs are classified or in which the award recipient’s service payments are classified.

Segment Information

The Company manages its operations as a single segment for the purposes of assessing performance and making operating decisions. The Company is developing and commercializing a proprietary system to preserve human organs for transplant in a near-physiologic condition to address the limitations of cold storage organ preservation. Operating segments are defined as components of an enterprise for which separate financial information is regularly evaluated by the Company’s chief operating decision maker, or decision-making group, in deciding how to allocate resources and assess performance. The Company has determined that its chief operating decision maker is its Chief Executive Officer. The Company’s chief operating decision maker reviews the Company’s financial information on a consolidated basis for purposes of allocating resources and assessing financial performance.

Net Income (Loss) per Share

Prior to closing of the IPO, the Company followed the two-class method when computing net income (loss) per share, as TransMedics had issued shares that met the definition of participating securities. The two-class method determines net income (loss) per share for each class of common and participating securities according to dividends declared or accumulated and participation rights in undistributed earnings. The two-class method requires income available to common stockholders for the period to be allocated between common and participating securities based upon their respective rights to receive dividends as if all income for the period had been distributed. The outstanding convertible preferred stock contractually entitled the holders of such shares to participate in dividends but did not contractually require the holders of such shares to participate in losses of the Company. Accordingly, in periods in which the Company reported a net loss, such losses were not allocated to such participating securities, and as a result, basic and diluted net loss per share were the same. The Company reported a net loss attributable to common stockholders for the fiscal three and six months ended June 29, 2019.

Under the two-class method, basic net income (loss) per share attributable to common stockholders is computed by dividing the net income (loss) attributable to common stockholders by the weighted average number of common shares outstanding for the period. Diluted net income (loss) attributable to common stockholders is computed by adjusting net income (loss) attributable to common stockholders to reallocate undistributed earnings based on the potential impact of dilutive securities. Diluted net income (loss) per share attributable to common stockholders is computed by dividing the diluted net income (loss) attributable to common stockholders by the weighted average number of common shares outstanding for the period, including potential dilutive common shares assuming the dilutive effect of common stock equivalents.

Subsequent to the closing of its IPO, the Company only has one class of shares outstanding and basic net income (loss) per common share is computed by dividing the net income (loss) by the weighted average number of shares of common stock outstanding for the period. Diluted net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of shares of common stock outstanding for the period, including potential dilutive common shares assuming the dilutive effect of outstanding stock awards. For periods in which the Company reports a net loss, diluted net loss per common share is the same as basic net loss per common share, since dilutive common shares are not assumed to have been issued if their effect is anti-dilutive. The Company reported a net loss attributable to common stockholders for the fiscal three and six months ended June 30, 2020.

Recently Issued Accounting Pronouncements

The Company qualifies as an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012 and has elected not to “opt out” of the extended transition related to complying with new or revised accounting standards, which means that when a standard is issued or revised and it has different application dates for public and nonpublic companies, the Company will adopt the new or revised standard at the time nonpublic companies adopt the new or revised standard and will do so until such time that the Company either (i) irrevocably elects to “opt out” of such extended transition period or (ii) no longer qualifies as an emerging growth company.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) (“ASU 2016-02”), which sets out the principles for the recognition, measurement, presentation, and disclosure of leases for both parties to a contract (i.e., lessees and lessors). The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less may be accounted for similar to existing guidance for operating leases today. For public entities, the guidance has been effective for annual reporting periods beginning after December 15, 2018 and for interim periods within those fiscal years. ASU 2016-02 initially required adoption using a modified retrospective approach, under which all years presented in the financial statements would be prepared under the revised guidance. In July 2018, the FASB issued ASU No. 2018-11, Leases (Topic 842), which added an optional transition method under which financial statements may be prepared under the revised guidance for the year of adoption, but not for prior years. Under the latter method, entities will recognize a cumulative catch-up adjustment to the opening balance of retained earnings in the period of adoption. In November 2019, the FASB issued ASU No. 2019-10, which deferred the effective date for nonpublic entities to annual reporting periods beginning after December 15, 2020, and interim periods within fiscal years beginning after December 15, 2021. In June 2020, the FASB issued ASU No. 2020-05, which grants a one-year effective-date delay for nonpublic entities to annual reporting periods beginning after December 15, 2021 and to interim periods within fiscal years beginning after December 15, 2022. The Company is currently planning to adopt this guidance on January 1, 2022 in accordance with the nonpublic company requirements and is evaluating the method of adoption and the impact that the adoption of ASU 2016-02 will have on its consolidated financial statements.

In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326). The new standard adjusts the accounting for assets held at amortized costs basis, including marketable securities accounted for as available for sale, and trade receivables. The standard eliminates the probable initial recognition threshold and requires an entity to reflect its current estimate of all expected credit losses. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the financial assets to present the net amount expected to be collected. For public entities except smaller reporting companies, the guidance is effective for annual reporting periods beginning after December 15, 2019 and for interim periods within those fiscal years. For non-public entities and smaller reporting companies, the guidance was effective for annual reporting periods beginning after December 15, 2021. Early adoption is permitted for all entities. In November 2019, the FASB issued ASU No. 2019-10, which deferred the effective date for non-public entities to annual reporting periods beginning after December 15, 2022, including interim periods within those fiscal years. Early application continues to be allowed. The Company is currently assessing the date of the adoption and the impact of the adoption of this guidance on its financial statements.

Marketable Securities

6 Months Ended

Jun. 30, 2020

Investments Debt And Equity Securities [Abstract]

Marketable Securities

3. Marketable Securities

As of June 30, 2020 and December 28, 2019, marketable securities by security type consisted of the following (in thousands):

	June 30, 2020
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
U.S. Treasury securities (due within one year)	$	67,607	$	86	$	(1	)	$	67,692
U.S. government agency bonds (due within one year)		20,498		33		—			20,531
	$	88,105	$	119	$	(1	)	$	88,223

	December 28, 2019
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
U.S. Treasury securities (due within one year)	$	23,318	$	17	$	—		$	23,335
U.S. government agency bonds (due within one year)		37,224		39		(2	)		37,261
	$	60,542	$	56	$	(2	)	$	60,596

Fair Value of Financial Assets and Liabilities

6 Months Ended

Jun. 30, 2020

Fair Value Disclosures [Abstract]

Fair Value of Financial Assets and Liabilities

4. Fair Value of Financial Assets and Liabilities

The following tables present the Company’s fair value hierarchy for its assets and liabilities that are measured at fair value on a recurring basis (in thousands):

	Fair Value Measurements at June 30, 2020 Using:
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents:
Money market funds	$	36,706	$	—	$	—	$	36,706
Marketable securities:
U.S. Treasury securities		—		67,692		—		67,692
U.S. government agency bonds		—		20,531		—		20,531
	$	36,706	$	88,223	$	—	$	124,929

	Fair Value Measurements at December 28, 2019 Using:
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents:
Money market funds	$	11,760	$	—	$	—	$	11,760
Marketable securities:
U.S. Treasury securities		—		23,335		—		23,335
U.S. government agency bonds		—		37,261		—		37,261
	$	11,760	$	60,596	$	—	$	72,356

Money market funds were valued by the Company based on quoted market prices, which represent a Level 1 measurement within the fair value hierarchy. U.S. Treasury securities and U.S. government agency bonds were valued by the Company using quoted prices in active markets for similar securities, which represent a Level 2 measurement within the fair value hierarchy. During the fiscal three and six months ended June 30, 2020 and June 29, 2019, there were no transfers between Level 1, Level 2, and Level 3.

Accrued Expenses And Other Current Liabilities [Abstract]

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

Inventory

6 Months Ended

Jun. 30, 2020

Inventory Disclosure [Abstract]

Inventory

5. Inventory

As of June 30, 2020 and December 28, 2019, inventory consisted of the following (in thousands):

	June 30, 2020		December 28, 2019
Raw materials	$	6,583	$	4,881
Work-in-process		959		903
Finished goods		5,013		5,432
	$	12,555	$	11,216

During the fiscal six months ended June 30, 2020 and June 29, 2019, the Company made non-cash transfers of OCS Consoles from inventory to property and equipment (OCS Consoles loaned to customers) of $0.1 million and $1.3 million, respectively.

Accrued Expenses and Other Current Liabilities

6 Months Ended

Jun. 30, 2020

Accrued Expenses and Other Current Liabilities

6. Accrued Expenses and Other Current Liabilities

As of June 30, 2020 and December 28, 2019, accrued expenses and other current liabilities consisted of the following (in thousands):

	June 30, 2020		December 28, 2019
Accrued research, development and clinical trials expenses	$	3,702	$	3,144
Accrued payroll and related expenses		3,441		3,604
Accrued other		1,715		1,584
	$	8,858	$	8,332

Long-Term Debt

6 Months Ended

Jun. 30, 2020

Debt Disclosure [Abstract]

Long-Term Debt

7. Long-Term Debt

TransMedics has a credit agreement (the “Credit Agreement”) with OrbiMed Royalty Opportunities II, LP (“OrbiMed”), entered into in June 2018, pursuant to which TransMedics borrowed $35.0 million. As of June 30, 2020 and December 28, 2019, long-term debt consisted of the following (in thousands):

	June 30, 2020			December 28, 2019
Principal amount of long-term debt	$	35,000		$	35,000
Less: Current portion of long-term debt		—			—
Long-term debt, net of current portion		35,000			35,000
Debt discount, net of accretion		(990	)		(1,139	)
Accrued end-of-term payment		385			285
Long-term debt, net of discount and current portion	$	34,395		$	34,146

Borrowings under the Credit Agreement bear interest at an annual rate equal to the London Interbank Offered Rate (“LIBOR”), subject to a minimum of 1.0% and a maximum of 4.0%, plus 8.5% (the “Applicable Margin”), subject in the aggregate to a maximum interest rate of 11.5%. In addition, borrowings under the Credit Agreement bear paid-in-kind (“PIK”) interest at an annual rate equal to the amount by which LIBOR plus the Applicable Margin exceeds 11.5%, but not to exceed 12.5%. The PIK interest is added to the principal amount of the borrowings outstanding at the end of each quarter until the maturity date of the Credit Agreement in June 2023. Borrowings under the Credit Agreement are repayable in quarterly interest-only payments until the maturity date, at which time all principal and accrued interest is due and payable. At its option, the Company may prepay outstanding borrowings under the Credit Agreement, subject to a prepayment premium of 9.0% of the principal amount of any prepayment within the first three years, which percentage decreases annually until it reaches zero at the end of three years. The Company is also required to make a final payment in an amount equal to 3.0% of the principal amount of any prepayment or repayment. The final payment and debt discount amounts are being accreted to interest expense over the term of the Credit Agreement using the effective interest method.

All obligations under the Credit Agreement are guaranteed by the Company and each of its material subsidiaries. All obligations of the Company and each guarantor are secured by substantially all of the Company’s and each guarantor’s assets, including their intellectual property, subject to certain exceptions, including a perfected security interest in substantially all tangible and intangible assets of the Company and each guarantor. Under the Credit Agreement, the Company has agreed to certain affirmative and negative covenants to which it will remain subject until maturity. The covenants include maintaining a minimum liquidity amount of $3.0 million; the requirement, on an annual basis, to deliver to OrbiMed annual audited financial statements with an unqualified audit opinion from the Company’s independent registered public accounting firm; and restrictions on the Company’s activities, including limitations on dispositions, mergers or acquisitions; encumbering its intellectual property; incurring indebtedness or liens; paying dividends; making certain investments; and engaging in certain other business transactions. As of June 30, 2020, the Company was in compliance with the covenants under the Credit Agreement.

The obligations under the Credit Agreement are subject to acceleration upon the occurrence of specified events of default, including payment default, change in control, bankruptcy, insolvency, certain defaults under other material debt, certain events with respect to governmental approvals (if such events could cause a material adverse change in the Company’s business), failure to comply with certain covenants, including the minimum liquidity and unqualified audit opinion covenants, and a material adverse change in the Company’s business, operations or other financial condition.

Upon the occurrence of an event of default and until such event of default is no longer continuing, the Applicable Margin will increase by 4.0% per annum. If an event of default (other than certain events of bankruptcy or insolvency) occurs and is continuing, OrbiMed may declare all or any portion of the outstanding principal amount of the borrowings plus accrued and unpaid interest to be due and payable. Upon the occurrence of certain events of bankruptcy or insolvency, all of the outstanding principal amount of the borrowings plus accrued and unpaid interest will automatically become due and payable. In addition, the Company may be required to prepay outstanding borrowings, subject to certain exceptions, with portions of net cash proceeds of certain asset sales and certain casualty and condemnation events.

As of June 30, 2020, the interest rate applicable to borrowings under the Credit Agreement was 10.0%. During the fiscal six months ended June 30, 2020, the weighted average effective interest rate on outstanding borrowings under the Credit Agreement was approximately 11.7%.

Paycheck Protection Program Loan

On April 20, 2020, TransMedics issued a Promissory Note to Bank of America, NA, pursuant to which it received loan proceeds of $2.2 million (the “Loan”) provided under the Paycheck Protection Program established under the Coronavirus Aid, Relief, and Economic Security Act and guaranteed by the U.S. Small Business Administration (the “Paycheck Protection Program”). However, based on updated guidance related to this program, the Company decided to repay the full amount of the Loan, and repaid the Loan on May 1, 2020. The Loan was unsecured, was scheduled to mature on April 20, 2022, had a fixed interest rate of 1.0% per annum and was subject to the standard terms and conditions applicable to loans administered under the Paycheck Protection Program.

Equity

6 Months Ended

Jun. 30, 2020

Equity [Abstract]

Equity

8. Equity

Preferred Stock

As of June 30, 2020, the Company’s articles of organization authorized the Company to issue up to 25,000,000 shares of preferred stock, no par value per share, all of which is undesignated.

Common Stock

As of June 30, 2020, the Company’s articles of organization authorized the Company to issue up to 150,000,000 shares of common stock, no par value per share. Each share of common stock is entitled to one vote on all matters submitted to a vote of the Company’s shareholders. The holders of common stock are entitled to receive dividends, if any, as may be declared by the board of directors. Through June 30, 2020, no dividends had been declared or paid.

Warrants

Immediately prior to the closing of the IPO on May 6, 2019, pursuant to the Corporate Reorganization, all of the outstanding preferred stock warrants of TransMedics were converted into warrants to purchase an aggregate of 64,440 shares of common stock. No warrants have been exercised. As a result, as of June 30, 2020, the Company has outstanding warrants to purchase 50,000 shares of common stock at an exercise price of $8.75 per share with an expiration date of November 7, 2022 and warrants to purchase 14,440 shares of common stock at an exercise price of $17.47 per share with an expiration date of May 6, 2024.

Stock-Based Compensation

6 Months Ended

Jun. 30, 2020

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Stock-Based Compensation

9. Stock-Based Compensation

2019 Stock Incentive Plan and Option Grants

On April 15, 2019, TransMedics Group’s board of directors adopted and its sole stockholder approved the 2019 Stock Incentive Plan (the “2019 Plan”), which became effective on that same date. The 2019 Plan provides for the grant of incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock, restricted stock units, unrestricted stock, unrestricted stock units, and other stock-based awards to employees, directors, and consultants of the Company and its subsidiaries. The number of shares of common stock of TransMedics Group initially available for issuance under the 2019 Plan was 3,428,571 shares, plus the number of shares underlying awards under the previously outstanding 2014 Stock Incentive Plan (the “2014 Plan”), not to exceed 1,595,189 shares, that expire or are terminated, surrendered, or cancelled without the delivery of shares, are forfeited to or repurchased by TransMedics Group or otherwise become available again for grant. Since the effectiveness of the Company’s 2019 Plan in April 2019, no future awards will be made under the 2014 Plan.

Shares withheld in payment of the exercise or purchase price of an award or in satisfaction of tax withholding requirements, and the shares covered by a stock appreciation right for which any portion is settled in stock, will reduce the number of shares available for issuance under the 2019 Plan. In addition, the number of shares available for issuance under the 2019 Plan (i) will not be increased by any shares delivered under the 2019 Plan that are subsequently repurchased using proceeds directly attributable to stock option exercises and (ii) will not be reduced by any awards that are settled in cash or that expire, become unexercisable, terminate or are forfeited to or repurchased by TransMedics Group without the issuance of stock under the 2019 Plan. As of June 30, 2020, 2,485,187 shares of common stock were available for issuance under the 2019 Plan.

During the fiscal six months ended June 30, 2020, the Company granted to its employees and its non-employee directors options with service-based vesting for the purchase of an aggregate of 564,836 shares of common stock with a weighted average grant fair value of $7.89 per share.

2019 Employee Stock Purchase Plan

On April 15, 2019, TransMedics Group’s board of directors adopted and its sole stockholder approved the 2019 Employee Stock Purchase Plan (the “2019 ESPP”), which became effective that same date. A total of 371,142 shares of common stock of TransMedics Group are reserved for issuance under the 2019 ESPP. During the fiscal six months ended June 30, 2020, 12,163 shares of common stock were issued under the 2019 ESPP and as of June 30, 2020, 358,979 shares of common stock remained available for issuance.

Stock-Based Compensation

The Company recorded stock-based compensation expense in the following expense categories of its consolidated statements of operations (in thousands):

	Fiscal Three Months Ended				Fiscal Six Months Ended
	June 30, 2020		June 29, 2019		June 30, 2020		June 29, 2019
Cost of revenue	$	8	$	5	$	12	$	8
Research, development and clinical trials expenses		129		17		183		33
Selling, general and administrative expenses		494		198		821		236
	$	631	$	220	$	1,016	$	277

As of June 30, 2020, total unrecognized compensation cost related to unvested share-based awards was $7.0 million which is expected to be recognized over a weighted average period of 2.9 years.

Commitments and Contingencies

6 Months Ended

Jun. 30, 2020

Commitments And Contingencies Disclosure [Abstract]

Commitments and Contingencies

10. Commitments and Contingencies

Operating Leases

On January 9, 2020, the Company amended each of the lease agreements for its corporate headquarters (the “Amendment”) to lease an additional 39,744 square feet for general office use and an additional 11,735 square feet for operational use (the “Extension Premises”). The Amendment also extended each of the existing lease terms from December 2021 to December 2026, with an option to extend for one additional period of five years. Under the Amendment, the landlord will contribute up to $3.4 million towards the Company’s leasehold improvements. The Amendment provides for annual base rent for the premises of approximately $1.9 million for the first year of the lease. Thereafter, the annual base rent will increase at an average of 2.5% each year until the end of the term. The Company is also obligated to pay the landlord certain costs, taxes, and operating expenses, subject to certain exclusions. On June 2, 2020, the Company further amended each of the lease agreements (the “Second Amendment”). The changes provided by the Second Amendment include (i) extending each of the existing lease terms for an additional year through December 31, 2027, (ii) delaying to October 23, 2020 the commencement of the Company’s occupation of the Extension Premises, and (iii) extending to December 23, 2021 the Company’s ability to utilize the contribution from the landlord toward the Company’s work on improvements of the premises. The Second Amendment provides for annual base rent of approximately $2.0 million for the additional lease year and postpones the Company’s obligation to pay rent for the Extension Premises until October 23, 2020.

The Company’s lease agreements, as amended, include payment escalations, rent holidays, and other lease incentives, which are accrued or deferred as appropriate such that rent expense for each lease is recognized on a straight-line basis over the respective lease terms, recording deferred rent for rent expense incurred but not yet paid. The Company recorded rent expense of $0.5 million and $0.3 million in each of the fiscal three months ended June 30, 2020 and June 29, 2019, respectively. The Company recorded rent expense of $1.0 million and $0.6 million in each of the fiscal six months ended June 30, 2020 and June 29, 2019, respectively. Costs incurred by the Company for tenant improvements but not yet reimbursed by the landlord are presented on the accompanying consolidated balance sheets as a tenant receivable within prepaid expenses and other current assets. As of June 30, 2020, the Company had a tenant receivable of $0.2 million.

Future minimum lease payments under operating leases as of June 30, 2020 are as follows (in thousands):

Year Ending:
December 31, 2020 (remaining 6 months)	$	646
December 31, 2021		1,900
December 31, 2022		1,948
December 31, 2023		1,997
December 31, 2024		2,047
Thereafter		6,452
	$	14,990

License Agreement with the Department of Veterans Affairs

In 2002, the Company entered into a license agreement with the Department of Veterans Affairs (the “VA”), under which the Company was granted an exclusive, worldwide license under specified patents to make, use, sell and import certain technology used in the Company’s products and a non-exclusive, worldwide license to make, use, sell and import solutions for use in or with those products. The rights under the license agreement continue until the expiration of the last to expire of the licensed patents. The majority of the licensed U.S. patents expired in 2017, and the foreign patents expired in September 2018. However, the Company has requested a patent term extension for one U.S. patent covered by the VA license agreement, U.S. Patent No. 6100082. The Company has been granted an interim patent term extension for this patent until September 23, 2020. The Company has not received final approval of the patent extension beyond the interim patent term extension already granted. The maximum extension granted would be through May 2022; however, the length of the patent term extension will be determined by the United States Patent and Trademark Office. The license includes the right to grant sublicenses, subject to approval by the VA and other restrictions, and is subject to the U.S. government’s right to practice the licensed patents on its own behalf without payment of a royalty and obligation to grant certain sublicenses as necessary to fulfill public health, welfare and safety needs. The license agreement also requires the Company to make its products covered by the licensed patents available to the public on reasonable terms and to provide the U.S. government such products at the lowest price.

As consideration for the licenses granted by the VA, the Company is obligated to pay tiered royalties ranging from a low single-digit to a mid single-digit percentage on net sales of each product covered by a licensed patent (subject to a minimum aggregate royalty payment of less than $0.1 million per year during each of the first five years after the first commercial sale, after which no minimum is required). Royalties will be paid by the Company on a licensed product-by-licensed product and country-by-country basis, beginning on the first commercial sale of such licensed product in such country until expiration of the last valid patent claim covering such licensed product in such country. The Company is also responsible for all costs related to the amendment, prosecution and maintenance of the licensed patent rights.

The VA license agreement can be terminated by the Company or the VA only if the other party fails to cure its material breach within a specified period after receiving notice of such breach.

401(k) Savings Plan

The Company has a defined-contribution savings plan under Section 401(k) of the Internal Revenue Code. This plan covers substantially all employees who meet minimum age and service requirements and allows participants to defer a portion of their annual compensation on a pre-tax basis. Company contributions to the plan may be made at the discretion of the board of directors. As of June 30, 2020 and December 28, 2019, the Company had not made any contributions to the plan.

Indemnification Agreements

In the ordinary course of business, the Company has agreed to defend and indemnify its customers against third-party claims asserting infringement of certain intellectual property rights, which may include patents, copyrights, trademarks, or trade secrets. The Company’s exposure under these indemnification provisions is generally limited to the total amount paid by the end-customer under the agreement. However, certain agreements include indemnification provisions that could potentially expose the Company to losses in excess of the amount received under the agreement. In the ordinary course of business, the Company may provide indemnification of varying scope and terms to vendors, lessors, business partners, and other parties with respect to certain matters including, but not limited to, losses arising out of breach of such agreements or from intellectual property infringement claims made by third parties. In addition, the Company has entered into indemnification agreements with members of its board of directors that will require the Company, among other things, to indemnify them against certain liabilities that may arise by reason of their status or services as directors or officers.

The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is, in many cases, unlimited. To date, the Company has not incurred any material costs as a result of such indemnifications. The Company is not currently aware of any indemnification claims and had not accrued any liabilities related to such obligations in its consolidated financial statements as of June 30, 2020 and December 28, 2019.

Legal Proceedings

The Company is not currently party to any material legal proceedings. At each reporting date, the Company evaluates whether or not a potential loss amount or a potential range of loss is probable and reasonably estimable under the provisions of the authoritative guidance that addresses accounting for contingencies. The Company expenses as incurred the costs related to such legal proceedings.

Net Loss per Share

6 Months Ended

Jun. 30, 2020

Earnings Per Share [Abstract]

Net Loss per Share

11. Net Loss per Share

Basic and diluted net loss per share attributable to common stockholders was calculated as follows (in thousands, except share and per share amounts):

	Fiscal Three Months Ended						Fiscal Six Months Ended
	June 30, 2020			June 29, 2019			June 30, 2020			June 29, 2019
Numerator:
Net loss attributable to common stockholders	$	(8,497	)	$	(9,195	)	$	(17,349	)	$	(16,090	)
Denominator:
Weighted average common shares outstanding, basic and diluted		23,330,918			13,133,834			22,259,047			7,277,237
Net loss per share attributable to common stockholders, basic and diluted	$	(0.36	)	$	(0.70	)	$	(0.78	)	$	(2.21	)

The Company’s potential dilutive securities have been excluded from the computation of diluted net loss per share as the effect would be to reduce the net loss per share. The Company excluded the following potential common shares, presented based on amounts outstanding at each period end, from the computation of diluted net loss per share attributable to common stockholders for the periods indicated above because including them would have had an anti-dilutive effect:

	As of
	June 30, 2020		June 29, 2019
Warrants to purchase common stock		64,440		64,440
Options to purchase common stock		2,253,691		2,017,165
Employee stock purchase plan		10,534		—
		2,328,665		2,081,605

Segment Reporting and Geographic Data

6 Months Ended

Jun. 30, 2020

Segment Reporting [Abstract]

Segment Reporting and Geographic Data

12. Segment Reporting and Geographic Data

The Company has determined that it operates in one segment (see Note 2). Financial data by geographical area is summarized as follows (in thousands):

	Fiscal Three Months Ended				Fiscal Six Months Ended
	June 30, 2020		June 29, 2019		June 30, 2020		June 29, 2019
Net revenue by country(1):
United States	$	2,440	$	4,302	$	7,648	$	7,255
United Kingdom		355		405		1,467		974
All other countries		596		959		1,806		2,113
Total net revenue	$	3,391	$	5,666	$	10,921	$	10,342

	June 30, 2020		December 28, 2019
Long-lived assets by country(2):
United States	$	3,757	$	4,007
All other countries		647		785
Total long-lived assets	$	4,404	$	4,792

(1)	Net revenue by country is categorized based on the location of the end customer.

(2)	The Company’s only long-lived assets consist of property and equipment, net of depreciation, which are categorized based on their location of domicile.

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

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Related Party Transactions

Related Party Transactions

6 Months Ended

Jun. 30, 2020

13. Related Party Transactions

Employment of Dr. Amira Hassanein

Dr. Amira Hassanein, who serves as Product Director for the Company’s OCS Lung program, is the sister of Dr. Waleed Hassanein, the Company’s President and Chief Executive Officer and a member of the Company’s board of directors. The Company paid Dr. Amira Hassanein $0.1 million and $0.2 million in total compensation for the fiscal three and six months ended June 30, 2020, respectively, and less than $0.1 million and $0.1 in total compensation for each of the fiscal three and six months ended June 29, 2019, respectively, for her services as an employee.

Summary of Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2020

Unaudited Interim Financial Information

Use of Estimates

Risk of Concentrations of Credit, Significant Customers and Significant Suppliers

Fair Value Measurements

•

Level 1—Quoted prices in active markets for identical assets or liabilities.

•

Marketable Securities

Revenue Recognition

Performance Obligations

The primary performance obligations in the Company’s customer arrangements from which it derives revenue are as follows:

•

Payments Made to Customers

Variable Consideration

Revenue from reimbursements of out-of-pocket expenses, including travel, lodging, and meals, is accounted for as variable consideration.

Contract Assets and Liabilities

Disaggregated Revenue

	Fiscal Three Months Ended				Fiscal Six Months Ended
	June 30, 2020		June 29, 2019		June 30, 2020		June 29, 2019
Gross revenue from sales to customers	$	3,923	$	6,215	$	12,166	$	11,505
Less: clinical trial payments reducing revenue		532		549		1,245		1,163
Total net revenue	$	3,391	$	5,666	$	10,921	$	10,342

	Fiscal Three Months Ended				Fiscal Six Months Ended
	June 30, 2020		June 29, 2019		June 30, 2020		June 29, 2019
Net revenue by OCS product:
OCS Lung net revenue	$	435	$	2,219	$	2,443	$	3,631
OCS Heart net revenue		2,220		2,643		6,351		4,565
OCS Liver net revenue		736		804		2,127		2,146
Total net revenue	$	3,391	$	5,666	$	10,921	$	10,342

	Fiscal Three Months Ended				Fiscal Six Months Ended
	June 30, 2020		June 29, 2019		June 30, 2020		June 29, 2019
Net revenue by country:
United States	$	2,440	$	4,302	$	7,648	$	7,255
United Kingdom		355		405		1,467		974
All other countries		596		959		1,806		2,113
Total net revenue	$	3,391	$	5,666	$	10,921	$	10,342

Other Revenue Considerations

Distributors

Stock-Based Compensation

Segment Information

Net Income (Loss) per Share

Recently Issued Accounting Pronouncements

Summary of Significant Accounting Policies (Tables)

6 Months Ended

Jun. 30, 2020

Schedule of Recognized Revenue Net of Payments

The reconciliation of gross revenue to net revenue for these certain payments is shown below (in thousands):

	Fiscal Three Months Ended				Fiscal Six Months Ended
	June 30, 2020		June 29, 2019		June 30, 2020		June 29, 2019
Gross revenue from sales to customers	$	3,923	$	6,215	$	12,166	$	11,505
Less: clinical trial payments reducing revenue		532		549		1,245		1,163
Total net revenue	$	3,391	$	5,666	$	10,921	$	10,342

Schedule of Net Revenue by OCS Product and Country

	Fiscal Three Months Ended				Fiscal Six Months Ended
	June 30, 2020		June 29, 2019		June 30, 2020		June 29, 2019
Net revenue by OCS product:
OCS Lung net revenue	$	435	$	2,219	$	2,443	$	3,631
OCS Heart net revenue		2,220		2,643		6,351		4,565
OCS Liver net revenue		736		804		2,127		2,146
Total net revenue	$	3,391	$	5,666	$	10,921	$	10,342

	Fiscal Three Months Ended				Fiscal Six Months Ended
	June 30, 2020		June 29, 2019		June 30, 2020		June 29, 2019
Net revenue by country:
United States	$	2,440	$	4,302	$	7,648	$	7,255
United Kingdom		355		405		1,467		974
All other countries		596		959		1,806		2,113
Total net revenue	$	3,391	$	5,666	$	10,921	$	10,342

Marketable Securities (Tables)

6 Months Ended

Jun. 30, 2020

Investments Debt And Equity Securities [Abstract]

Components of Marketable Securities by Security Type

As of June 30, 2020 and December 28, 2019, marketable securities by security type consisted of the following (in thousands):

	June 30, 2020
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
U.S. Treasury securities (due within one year)	$	67,607	$	86	$	(1	)	$	67,692
U.S. government agency bonds (due within one year)		20,498		33		—			20,531
	$	88,105	$	119	$	(1	)	$	88,223

	December 28, 2019
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
U.S. Treasury securities (due within one year)	$	23,318	$	17	$	—		$	23,335
U.S. government agency bonds (due within one year)		37,224		39		(2	)		37,261
	$	60,542	$	56	$	(2	)	$	60,596

Fair Value of Financial Assets and Liabilities (Tables)

6 Months Ended

Jun. 30, 2020

Fair Value Disclosures [Abstract]

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis

The following tables present the Company’s fair value hierarchy for its assets and liabilities that are measured at fair value on a recurring basis (in thousands):

	Fair Value Measurements at June 30, 2020 Using:
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents:
Money market funds	$	36,706	$	—	$	—	$	36,706
Marketable securities:
U.S. Treasury securities		—		67,692		—		67,692
U.S. government agency bonds		—		20,531		—		20,531
	$	36,706	$	88,223	$	—	$	124,929

	Fair Value Measurements at December 28, 2019 Using:
	Level 1		Level 2		Level 3		Total
Assets:
Cash equivalents:
Money market funds	$	11,760	$	—	$	—	$	11,760
Marketable securities:
U.S. Treasury securities		—		23,335		—		23,335
U.S. government agency bonds		—		37,261		—		37,261
	$	11,760	$	60,596	$	—	$	72,356

Inventory (Tables)

6 Months Ended

Jun. 30, 2020

Inventory Disclosure [Abstract]

Schedule of Inventory, Current

As of June 30, 2020 and December 28, 2019, inventory consisted of the following (in thousands):

	June 30, 2020		December 28, 2019
Raw materials	$	6,583	$	4,881
Work-in-process		959		903
Finished goods		5,013		5,432
	$	12,555	$	11,216

Accrued Expenses and Other Current Liabilities (Tables)

6 Months Ended

Jun. 30, 2020

Accrued Expenses And Other Current Liabilities [Abstract]

Schedule of Accrued Expenses and Other Current Liabilities

As of June 30, 2020 and December 28, 2019, accrued expenses and other current liabilities consisted of the following (in thousands):

	June 30, 2020		December 28, 2019
Accrued research, development and clinical trials expenses	$	3,702	$	3,144
Accrued payroll and related expenses		3,441		3,604
Accrued other		1,715		1,584
	$	8,858	$	8,332

Long-term Debt (Tables)

6 Months Ended

Jun. 30, 2020

Debt Disclosure [Abstract]

Schedule of Long-term Debt Instruments

As of June 30, 2020 and December 28, 2019, long-term debt consisted of the following (in thousands):

	June 30, 2020			December 28, 2019
Principal amount of long-term debt	$	35,000		$	35,000
Less: Current portion of long-term debt		—			—
Long-term debt, net of current portion		35,000			35,000
Debt discount, net of accretion		(990	)		(1,139	)
Accrued end-of-term payment		385			285
Long-term debt, net of discount and current portion	$	34,395		$	34,146

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

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Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Stock-Based Compensation (Tables)

6 Months Ended

Jun. 30, 2020

Schedule of Stock-based Compensation Expense

The Company recorded stock-based compensation expense in the following expense categories of its consolidated statements of operations (in thousands):

	Fiscal Three Months Ended				Fiscal Six Months Ended
	June 30, 2020		June 29, 2019		June 30, 2020		June 29, 2019
Cost of revenue	$	8	$	5	$	12	$	8
Research, development and clinical trials expenses		129		17		183		33
Selling, general and administrative expenses		494		198		821		236
	$	631	$	220	$	1,016	$	277

Commitments and Contingencies (Tables)

6 Months Ended

Jun. 30, 2020

Commitments And Contingencies Disclosure [Abstract]

Schedule of future minimum lease payments

Future minimum lease payments under operating leases as of June 30, 2020 are as follows (in thousands):

Year Ending:
December 31, 2020 (remaining 6 months)	$	646
December 31, 2021		1,900
December 31, 2022		1,948
December 31, 2023		1,997
December 31, 2024		2,047
Thereafter		6,452
	$	14,990

Net Loss per Share (Tables)

6 Months Ended

Jun. 30, 2020

Earnings Per Share [Abstract]

Schedule of Basic and Diluted Net Loss per Share Attributable to Common Stockholders

Basic and diluted net loss per share attributable to common stockholders was calculated as follows (in thousands, except share and per share amounts):

	Fiscal Three Months Ended						Fiscal Six Months Ended
	June 30, 2020			June 29, 2019			June 30, 2020			June 29, 2019
Numerator:
Net loss attributable to common stockholders	$	(8,497	)	$	(9,195	)	$	(17,349	)	$	(16,090	)
Denominator:
Weighted average common shares outstanding, basic and diluted		23,330,918			13,133,834			22,259,047			7,277,237
Net loss per share attributable to common stockholders, basic and diluted	$	(0.36	)	$	(0.70	)	$	(0.78	)	$	(2.21	)

Schedule of Potential Common Shares Excluded from Computation of Diluted Net Loss per Share Attributable to Common Stockholders

The Company excluded the following potential common shares, presented based on amounts outstanding at each period end, from the computation of diluted net loss per share attributable to common stockholders for the periods indicated above because including them would have had an anti-dilutive effect:

	As of
	June 30, 2020		June 29, 2019
Warrants to purchase common stock		64,440		64,440
Options to purchase common stock		2,253,691		2,017,165
Employee stock purchase plan		10,534		—
		2,328,665		2,081,605

Segment Reporting and Geographic Data (Tables)

6 Months Ended

Jun. 30, 2020

Segment Reporting [Abstract]

Schedule of Financial data by geographical area

Financial data by geographical area is summarized as follows (in thousands):

	Fiscal Three Months Ended				Fiscal Six Months Ended
	June 30, 2020		June 29, 2019		June 30, 2020		June 29, 2019
Net revenue by country(1):
United States	$	2,440	$	4,302	$	7,648	$	7,255
United Kingdom		355		405		1,467		974
All other countries		596		959		1,806		2,113
Total net revenue	$	3,391	$	5,666	$	10,921	$	10,342

Schedule of Geographic Area

	June 30, 2020		December 28, 2019
Long-lived assets by country(2):
United States	$	3,757	$	4,007
All other countries		647		785
Total long-lived assets	$	4,404	$	4,792

(1)	Net revenue by country is categorized based on the location of the end customer.

(2)	The Company’s only long-lived assets consist of property and equipment, net of depreciation, which are categorized based on their location of domicile.

Nature of the Business and Basis of Presentation - Additional Information (Detail) - USD ($) $ in Thousands			3 Months Ended		6 Months Ended		12 Months Ended
	May 26, 2020	May 06, 2019	Jun. 30, 2020	Jun. 29, 2019	Jun. 30, 2020	Jun. 29, 2019	Dec. 28, 2019
Convertible preferred stock conversion ratio					3.5-for-one
Percentage of equity interests			100.00%		100.00%
Discounts and issuance costs of stock issued			$ 628	$ 5,966
Net loss					$ (17,349)	$ (16,090)	$ (33,500)
Accumulated deficit			(386,832)		(386,832)		$ (369,483)
Cash equivalents and marketable securities			$ 139,400		$ 139,400
IPO [Member]
Issue and sale of shares of common stock		6,543,500
Net proceeds from initial public offering		$ 91,400
Discounts and issuance costs of stock issued		$ 6,000
Over-Allotment Option [Member]
Issue and sale of shares of common stock	750,000	853,500
Underwritten Public Offering [Member]
Issue and sale of shares of common stock	5,750,000
Discounts and issuance costs of stock issued	$ 600
Net proceeds from public offering	$ 75,000

Summary of Significant Accounting Policies - Additional Information (Detail) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020 USD ($)	Jun. 29, 2019 USD ($)	Jun. 30, 2020 USD ($) Segment	Jun. 29, 2019 USD ($)	Dec. 28, 2019 USD ($)
Clinical trial cost	$ 532	$ 549	$ 1,245	$ 1,163
Research development and clinical trials expenses	400	$ 300	$ 800	$ 500
Revenue performance obligation description of payment terms			Payment terms for customer orders, including for each of the Company’s primary performance obligations, are typically 30 days for customers in the United States and 30 to 90 days for customers in non-U.S. markets, and such payments do not include payments that are variable, dependent on specified factors or events.
Contract assets	0		$ 0		$ 0
Performance obligations totaled	$ 2,900		$ 2,900
Revenue performance obligation description of timing			The Company generally satisfies performance obligations within one year of the contract inception date.
Number of operating segments \| Segment			1
Accounts Receivable [Member] \| Minimum [Member]
Concentration risk percentage			10.00%
Revenue [Member] \| Minimum [Member]
Concentration risk percentage			10.00%
Customer Concentration Risk \| Revenue [Member] \| Customer One
Concentration risk percentage	17.00%	17.00%	11.00%	12.00%

Summary of Significant Accounting Policies - Schedule of Recognized Revenue Net of Payments (Detail) - USD ($)
$ in Thousands

3 Months Ended

6 Months Ended

Jun. 30, 2020

Jun. 29, 2019

Jun. 30, 2020

Jun. 29, 2019

Gross revenue from sales to customers

$ 3,923

$ 6,215

$ 12,166

$ 11,505

Less: clinical trial payments reducing revenue

532

549

1,245

1,163

Total net revenue

^[1]

$ 3,391

$ 5,666

$ 10,921

$ 10,342

[1]	Net revenue by country is categorized based on the location of the end customer.

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

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Amount of revenue recognized from goods sold, services rendered, insurance premiums, or other activities that constitute an earning process. Includes, but is not limited to, investment and interest income before deduction of interest expense when recognized as a component of revenue, and sales and trading gain (loss).

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Summary of Significant Accounting Policies - Schedule of Net Revenue by OCS Product and Country (Detail) - USD ($)
$ in Thousands

3 Months Ended

6 Months Ended

Jun. 30, 2020

Jun. 29, 2019

Jun. 30, 2020

Jun. 29, 2019

^[1]

$ 3,391

$ 5,666

$ 10,921

$ 10,342

United States [Member]

^[1]

2,440

4,302

7,648

7,255

United Kingdom [Member]

All Other Countries [Member]

^[1]

355

405

1,467

974

OCS Lung net revenue [Member]

596

959

1,806

2,113

OCS Heart net revenue [Member]

435

2,219

2,443

3,631

OCS Liver net revenue [Member]

2,220

2,643

6,351

4,565

$ 736

$ 804

$ 2,127

$ 2,146

[1]	Net revenue by country is categorized based on the location of the end customer.

Marketable Securities - Components of Marketable Securities by Security Type (Detail) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 28, 2019
Schedule Of Available For Sale Securities [Line Items]
Marketable Securities, Amortized Cost	$ 88,105	$ 60,542
Marketable Securities, Gross Unrealized Gains	119	56
Marketable Securities, Gross Unrealized Losses	(1)	(2)
Marketable Securities, Fair Value	88,223	60,596
U.S. Treasury Securities (due within one year) [Member]
Schedule Of Available For Sale Securities [Line Items]
Marketable Securities, Amortized Cost	67,607	23,318
Marketable Securities, Gross Unrealized Gains	86	17
Marketable Securities, Gross Unrealized Losses	(1)
Marketable Securities, Fair Value	67,692	23,335
U.S. Government Agency Bonds (due within one year) [Member]
Schedule Of Available For Sale Securities [Line Items]
Marketable Securities, Amortized Cost	20,498	37,224
Marketable Securities, Gross Unrealized Gains	33	39
Marketable Securities, Gross Unrealized Losses		(2)
Marketable Securities, Fair Value	$ 20,531	$ 37,261

Fair Value of Financial Assets and Liabilities - Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis (Detail) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 28, 2019
Marketable securities:
Marketable securities	$ 88,223	$ 60,596
Cash equivalents and marketable securities	124,929	72,356
U.S. Treasury Securities [Member]
Marketable securities:
Marketable securities	67,692	23,335
U.S. Government Agency Bonds [Member]
Marketable securities:
Marketable securities	20,531	37,261
Money Market Funds [Member]
Cash equivalents:
Cash equivalents	36,706	11,760
Level 1 [Member]
Marketable securities:
Cash equivalents and marketable securities	36,706	11,760
Level 1 [Member] \| Money Market Funds [Member]
Cash equivalents:
Cash equivalents	36,706	11,760
Level 2 [Member]
Marketable securities:
Cash equivalents and marketable securities	88,223	60,596
Level 2 [Member] \| U.S. Treasury Securities [Member]
Marketable securities:
Marketable securities	67,692	23,335
Level 2 [Member] \| U.S. Government Agency Bonds [Member]
Marketable securities:
Marketable securities	$ 20,531	$ 37,261

Inventory - Schedule of Inventory, Current (Detail) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 28, 2019
Inventory Disclosure [Abstract]
Raw materials	$ 6,583	$ 4,881
Work-in-process	959	903
Finished goods	5,013	5,432
Inventory, net	$ 12,555	$ 11,216

Inventory - Additional Information (Detail) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2020	Jun. 29, 2019
Inventory Disclosure [Abstract]
Inventory transfer to property plant and equipment	$ 78	$ 1,263

Accrued Expenses and Other Current Liabilities - Schedule of Accrued Expenses and Other Current Liabilities (Detail) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 28, 2019
Accrued Expenses And Other Current Liabilities [Abstract]
Accrued research, development and clinical trials expenses	$ 3,702	$ 3,144
Accrued payroll and related expenses	3,441	3,604
Accrued other	1,715	1,584
Accrued expenses and other liabilities current	$ 8,858	$ 8,332

Long-term Debt - Additional Information (Detail) - USD ($)		6 Months Ended
	Apr. 20, 2020	Jun. 30, 2020	Dec. 28, 2019	Jun. 29, 2018
Long-term debt		$ 35,000,000	$ 35,000,000
Interest rate effective percentage		10.00%
Prepayment percentage		3.00%
Average effective interest rate		11.70%
In Event Of Default [Member]
Increasing applicable margin		4.00%
Paid In Kind [Member]
Paid in kind interest threshold		11.50%
Maximum [Member]
Prepayment premium percentage		9.00%
Maximum [Member] \| Paid In Kind [Member]
Interest rate		12.50%
Orbi Med [Member]
Long-term debt				$ 35,000,000
Basis spread on variable rate		8.50%
Description of covenants		The covenants include maintaining a minimum liquidity amount of $3.0 million; the requirement, on an annual basis, to deliver to OrbiMed annual audited financial statements with an unqualified audit opinion from the Company’s independent registered public accounting firm; and restrictions on the Company’s activities, including limitations on dispositions, mergers or acquisitions; encumbering its intellectual property; incurring indebtedness or liens; paying dividends; making certain investments; and engaging in certain other business transactions.
Minimum liquidity covenant amount		$ 3,000,000
Orbi Med [Member] \| Credit Agreement [Member]
Debt instrument, maturity month and year		2023-06
Orbi Med [Member] \| Minimum [Member]
LIBOR rate		1.00%
Orbi Med [Member] \| Maximum [Member]
LIBOR rate		4.00%
Interest rate effective percentage		11.50%
Bank of America [Member] \| Promissory Note [Member] \| Paycheck Protection Program [Member]
Loan proceeds	$ 2,200,000
Repayment date	May 01, 2020
Maturity date	Apr. 20, 2022
Fixed interest rate	1.00%

Long-term Debt - Schedule of Long-term Debt Instruments (Detail) - USD ($) $ in Thousands	Jun. 30, 2020	Dec. 28, 2019
Debt Disclosure [Abstract]
Principal amount of long-term debt	$ 35,000	$ 35,000
Less: Current portion of long-term debt	0
Long-term debt, net of current portion	35,000	35,000
Debt discount, net of accretion	(990)	(1,139)
Accrued end-of-term payment	385	285
Long-term debt, net of discount and current portion	$ 34,395	$ 34,146

Equity - Additional Information (Detail) - $ / shares	6 Months Ended
Equity - Additional Information (Detail) - $ / shares	Jun. 30, 2020	Dec. 28, 2019	May 06, 2019
Preferred stock authorized	25,000,000	25,000,000
Preferred stock, no par value
Common stock, shares authorized	150,000,000	150,000,000
Common stock, no par value
Common stock, voting rights	one vote
Common stock, dividends, declared	$ 0
Common stock, dividends, cash paid	$ 0
Preferred stock warrants shares issued upon conversion			64,440
Exercise Price of $8.75 Per Share [Member]
Preferred stock warrants shares issued upon conversion	50,000
Preferred stock warrants convertible conversion price	$ 8.75
Exercise Price of $17.47 Per Share [Member]
Preferred stock warrants shares issued upon conversion	14,440
Preferred stock warrants convertible conversion price	$ 17.47

Stock-Based Compensation - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Millions		6 Months Ended
	Apr. 15, 2019	Jun. 30, 2020
Unrecognized compensation cost related to unvested employee and director stock-based awards		$ 7.0
Weighted average period for unrecognized compensation cost		2 years 10 months 24 days
2019 Stock Plan [Member]
Shares available for future issuance	3,428,571	2,485,187
2019 Stock Plan [Member] \| Common Stock [Member] \| Service Based Vesting [Member]
Options granted		564,836
Options granted weighted average grant fair value of per share		$ 7.89
2019 Stock Plan [Member] \| Maximum [Member]
Number of shares underlying awards increase (decrease)	1,595,189
2014 Stock Incentive Plan [Member] \| Maximum [Member]
Number of shares underlying awards forfeited in period	1,595,189
2019 Employee Stock Purchase Plan [Member]
Shares available for future issuance	371,142
Shares available for future issuance, Grant		358,979
Number of share issued		12,163

Stock-Based Compensation - Schedule of Stock-based Compensation Expense (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2020	Jun. 29, 2019	Jun. 30, 2020	Jun. 29, 2019
Allocated share-based compensation expense	$ 631	$ 220	$ 1,016	$ 277
Cost of revenue [Member]
Allocated share-based compensation expense	8	5	12	8
Research, development and clinical trials expenses [Member]
Allocated share-based compensation expense	129	17	183	33
Selling, general and administrative expenses [Member]
Allocated share-based compensation expense	$ 494	$ 198	$ 821	$ 236

Commitments and Contingencies - Additional Information (Detail) $ in Millions			3 Months Ended		6 Months Ended
	Jun. 02, 2020 USD ($)	Jan. 09, 2020 USD ($) ft²	Jun. 30, 2020 USD ($)	Jun. 29, 2019 USD ($)	Jun. 30, 2020 USD ($)	Jun. 29, 2019 USD ($)
Rent expense			$ 0.5	$ 0.3	$ 1.0	$ 0.6
Tenant improvements allowance receivable			$ 0.2		0.2
Maximum [Member]
Guaranteed minimum annual royalty payment					$ 0.1
Omnibus Amendment 1 [Member]
Lease expiration month and year		2026-12
Extended lease term		5 years
Leasehold improvements landlord allowance		$ 3.4
Lease existence of option to extend		true
Lease base rent annual increase		2.50%
Omnibus Amendment 1 [Member] \| Annual Rent [Member]
Lease annual base rent		$ 1.9
Omnibus Amendment 1 [Member] \| Additional Office Use [Member]
Area of office space \| ft²		39,744
Omnibus Amendment 1 [Member] \| Additional Operational Use [Member]
Area of office space \| ft²		11,735
Omnibus Amendment 2 [Member]
Lease existence of option to extend	true
Operating Lease, Description	(i) extending each of the existing lease terms for an additional year through December 31, 2027, (ii) delaying to October 23, 2020 the commencement of the Company’s occupation of the Extension Premises, and (iii) extending to December 23, 2021 the Company’s ability to utilize the contribution from the landlord toward the Company’s work on improvements of the premises
Lease expiration month and year	Dec. 31, 2027
Omnibus Amendment 2 [Member] \| Annual Rent [Member]
Lease annual base rent	$ 2.0

Commitments and Contingencies - Schedule of future minimum lease payments (Detail) $ in Thousands	Jun. 30, 2020 USD ($)
Commitments And Contingencies Disclosure [Abstract]
December 31, 2020 (remaining 6 months)	$ 646
December 31, 2021	1,900
December 31, 2022	1,948
December 31, 2023	1,997
December 31, 2024	2,047
Thereafter	6,452
Future minimum payments due	$ 14,990

Net Loss per Share - Schedule of Basic and Diluted Net Loss per Share Attributable to Common Stockholders (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended				6 Months Ended
	Jun. 30, 2020	Mar. 31, 2020	Jun. 29, 2019	Mar. 30, 2019	Jun. 30, 2020	Jun. 29, 2019
Numerator:
Net loss attributable to common stockholders	$ (8,497)	$ (8,852)	$ (9,195)	$ (6,895)	$ (17,349)	$ (16,090)
Denominator:
Weighted average common shares outstanding, basic and diluted	23,330,918		13,133,834		22,259,047	7,277,237
Net loss per share attributable to common stockholders, basic and diluted	$ (0.36)		$ (0.70)		$ (0.78)	$ (2.21)

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

Net Loss per Share - Schedule of Potential Common Shares Excluded from Computation of Diluted Net Loss per Share Attributable to Common Stockholders (Detail) - shares	6 Months Ended
	Jun. 30, 2020	Jun. 29, 2019
Antidilutive securities excluded from computation of earnings per share	2,328,665	2,081,605
Warrants to purchase common stock [Member]
Antidilutive securities excluded from computation of earnings per share	64,440	64,440
Options to purchase common stock [Member]
Antidilutive securities excluded from computation of earnings per share	2,253,691	2,017,165
Employee Stock Purchase Plan [Member]
Antidilutive securities excluded from computation of earnings per share	10,534

Segment Reporting and Geographic Data - Financial data by geographical area (Detail) - USD ($)
$ in Thousands

3 Months Ended

6 Months Ended

Jun. 30, 2020

Jun. 29, 2019

Jun. 30, 2020

Jun. 29, 2019

^[1]

$ 3,391

$ 5,666

$ 10,921

$ 10,342

United States [Member]

^[1]

2,440

4,302

7,648

7,255

United Kingdom [Member]

All Other Countries [Member]

^[1]

355

405

1,467

974

^[1]

$ 596

$ 959

$ 1,806

$ 2,113

[1]	Net revenue by country is categorized based on the location of the end customer.