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| Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Debt | Debt The following table summarizes loans payable, net (in thousands):
We had a Credit and Security Agreement with MidCap Financial Trust (MidCap) entered into on September 27, 2019 and amended on March 29, 2021, February 11, 2022, July 27, 2022, and on April 11, 2024, which provided for a $60.0 million term loan credit facility (the prior Credit Agreement). Under the prior Credit Agreement, the term loans were scheduled to mature on September 1, 2027, and the interest-only period was through October 1, 2025. The term loans bore interest equal to the sum of one-month Secured Overnight Financing Rate (SOFR) plus an adjustment of 0.11448%, subject to a 4.00% applicable floor, plus applicable margin of 6.50%. A final payment fee of 4.25% of principal was due at maturity date. Under the prior Credit Agreement, we could make voluntary prepayments, in whole or in part, subject to certain prepayment premiums and additional interest payments. It also contained certain provisions, such as event of default and change in control provisions, which, if triggered, would have required us to make mandatory prepayments on the term loan. The obligations under the prior Credit Agreement were secured by a perfected security interest in all of our assets including our intellectual property.
On May 5, 2026, we repaid all outstanding term loan borrowings, including final payment fees, the applicable prepayment premium, and accrued interest, under the prior Credit Agreement with MidCap. Concurrently, we entered into a new credit agreement with MidCap providing for a revolving credit facility with a maximum borrowing capacity of $40.0 million, with an option to increase the facility to $60.0 million, subject to customary conditions (the new Credit Agreement). The revolving credit facility has a five-year term and bears interest at a rate equal to one-month SOFR, subject to a 2.00% floor, plus an applicable margin of 4.00%.
We evaluated this transaction under ASC 470-50, Debt—Modifications and Extinguishments, on a lender-by-lender basis. The portion of the prior term loan attributable to the continuing lender under the new revolving credit facility was accounted for as a debt modification. Accordingly, the related unamortized debt issuance costs and creditor fees of approximately $0.5 million continue to be amortized over the term of the new revolving credit facility. The remaining portion of the prior term loan was accounted for as a debt extinguishment, resulting in a loss on extinguishment of approximately $0.2 million during the second quarter of 2026. The loss was primarily related to the write-off of unamortized debt issuance costs, unaccrued final payment fees, and prepayment premiums attributable to the extinguished portion.
The availability under the revolving credit facility is subject to a borrowing base based primarily on eligible accounts receivable and inventory. Pursuant to the terms of the facility, substantially all of our accounts receivable collections are remitted to a lender-controlled lockbox account. Upon the occurrence of certain specified conditions, including an event of default, the funds in the lockbox account are required to be transferred to MidCap's payment account and applied to reduce outstanding borrowings under the facility. Subject to borrowing base availability and compliance with the terms of the agreement, we may re-borrow amounts under the revolving credit facility. Although the lockbox account is subject to contractual restrictions that require cash receipts to be applied to outstanding borrowings under those circumstances, we retain the ability to access liquidity through re-borrowings under the revolving credit facility, subject to borrowing base availability and covenant compliance.
The obligations under the revolving credit facility are secured by a first-priority security interest in substantially all of our assets, including our intellectual property. The revolving credit facility includes customary fees, including an unused commitment fee, administrative fee and prepayment premiums during the initial period.
At September 30, 2026, we had an outstanding borrowing of $8.0 million under the revolving credit facility, reflecting an initial $8.0 million borrowing in May 2026, and an additional $32.0 million borrowing in June 2026, and repayment of the $32.0 million in July 2026. The outstanding borrowings under the revolving credit facility were classified as a current liability on the condensed balance sheet. This classification reflects the nature of the facility, including its asset-based structure, borrowing base limitations, required application of certain cash receipts to outstanding borrowings, ongoing covenant compliance and provisions that may require repayment upon occurrence of certain events. The classification of borrowings under the revolving credit facility may change in future periods based on the facts and circumstances existing at each reporting date, including borrowing base availability, covenant compliance and our ability to maintain or refinance borrowings on a long-term basis. At September 30, 2026, the weighted-average interest rate on the outstanding borrowings under the revolving credit facility was 7.7%.
At September 30, 2026 and December 31, 2025, the carrying amounts of borrowings under our revolving credit facility and term loan facility, respectively, approximated fair value because management believes the applicable credit spreads were consistent with those available for similar borrowings at the respective dates. These fair values are classified as Level 2 within the fair value hierarchy.
The revolving credit facility contains customary covenants that, among other things, require us to deliver financial reports at specified times and maintain minimum liquidity and trailing twelve month product revenue. The minimum product revenue covenant is tested only during periods when the liquidity falls below specified thresholds. At September 30, 2026, we were not in violation of any covenants. Interest expense includes amortization of the debt discount, accretion of the final fees, and losses on extinguishment attributable to the extinguished portion of the prior term loan. Interest expense was $0.3 million and $1.9 million, for the three months ended September 30, 2026 and 2025, respectively, and $2.5 million and $5.6 million for the nine months ended September 30, 2026 and 2025, respectively. Accrued interest of $0.1 million at September 30, 2026, was included in accounts payable, and accrued interest of $2.6 million at December 31, 2025, was included in other accrued liabilities in the condensed balance sheets.
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