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Basis of Presentation and Summary of Significant Accounting Policies (Tables)
 9 Months Ended
Sep. 30, 2018
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Schedule of Revenue by Source
The following table represents disaggregation of Material Sales and License fees, milestone and other (in thousands):

Three months endedNine months ended
September 30,
September 30,
2018201720182017
Material Sales 
Captisol $7,027 $7,664 $19,030 $14,336 
License fees, milestones and other 
License Fees $265 $738 $75,201 $4,276 
Milestone 1,308 2,059 6,052 7,564 
Other 936 983 3,237 4,090 
$2,509 $3,780 $84,490 $15,930 
Schedule of Investment Categories
Our investments consist of the following at September 30, 2018 and December 31, 2017 (in thousands):
September 30, 2018December 31, 2017 
Amortized cost Gross unrealized gains Gross unrealized losses Estimated fair value Amortized cost Gross unrealized gains Gross unrealized losses Estimated fair value 
Short-term investments 
Bank deposits $411,166 $98 $(17)$411,247 $80,095 $6 $(42)$80,059 
Corporate bonds 76,961 4 (52)76,913 55,335 — (96)55,239 
Commercial paper 288,549 3 (72)288,480 27,933 — (20)27,913 
U.S. Government bonds 110,834 — (25)110,809 8,939 — (10)8,929 
Agency bonds — — — — 4,991 — (1)4,990 
Municipal bonds 2,008 — (13)1,995 2,028 — (13)2,015 
Corporate equity securities 135 1,549 — 1,684 207 1,689 — 1,896 
$889,653 $1,654 $(179)$891,128 $179,528 $1,695 $(182)$181,041 
Schedule of Goodwill and Other Identifiable Intangible Assets
Goodwill and other identifiable intangible assets consist of the following (in thousands):
September 30, December 31, 
20182017
Indefinite lived intangible assets 
IPR&D $— $7,923 
Goodwill 85,961 85,959 
Definite lived intangible assets 
Complete technology 228,413 222,900 
Less: accumulated amortization (31,990)(23,301)
Trade name 2,642 2,642 
Less: accumulated amortization (1,015)(916)
Customer relationships 29,600 29,600 
Less: accumulated amortization (11,374)(10,264)
Total goodwill and other identifiable intangible assets, net $302,237 $314,543 
Schedule of Commercial License Rights
Commercial license rights consist of the following (in thousands):

September 30,December 31,
20182017
Aziyo and CorMatrix $17,696 $17,696 
Selexis 8,602 8,602 
$26,298 $26,298 
Less: accumulated amortization (5,364)(6,772)
Total commercial rights, net $20,934 $19,526 
Schedule of Accrued Liabilities
Accrued liabilities consist of the following (in thousands):
September 30,December 31,
20182017
Compensation $4,249 $4,085 
Professional fees 594 430 
Amounts owed to former licensees 481 396 
Royalties owed to third parties 74 954 
Other 3,869 1,512 
 Total accrued liabilities
$9,267 $7,377 
Schedule of Accounting for Share-Based Compensation The following table summarizes share-based compensation expense recorded as components of research and development expenses and general and administrative expenses for the periods indicated (in thousands):
Three months ended Nine months ended 
September 30, September 30, 
2018201720182017
Share-based compensation expense as a component of: 
Research and development expenses $2,257 $2,394 $6,120 $8,260 
General and administrative expenses 3,213 2,854 8,717 7,657 
$5,470 $5,248 $14,837 $15,917 
Schedule of Fair-Value Options Awarded to Employees and Directors The fair-value for options that were awarded to employees and directors was estimated at the date of grant using the Black-Scholes option valuation model with the following weighted-average assumptions:
Three months ended Nine months ended 
September 30, September 30, 
2018201720182017
Risk-free interest rate N/A  2%  2.8%  2.1%  
Dividend yield N/A  N/A  N/A N/A 
Expected volatility N/A  47%  34%  47%  
Expected term N/A  6.55.76.8
Schedule of Inputs and Assumptions Used to Calculate Fair Value of Derivatives
The following table summarizes the inputs and assumptions used in the Black-Scholes model to calculate the fair value of the assets and the inputs and assumptions used in the Binomial model to calculate the fair value of the derivative liabilities associated with the 2023 Notes:
As of May 22, 2018 As of June 19, 2018 
Common stock price $187.09 $195.91 
Exercise price, conversion premium and bond hedge $248.48 $248.48 
Exercise price, warrant $315.38 $315.38 
Risk-free interest rate 2.9%  2.8%  
Volatility 
30%-35%
30%-35%
Dividend yield —  —  
Annual coupon rate 0.75%  0.75%  
Remaining contractual term (in years) 5.004.98

In addition, on May 22, 2018, we amended our 2019 Notes making an irrevocable election to settle the entire note in cash. As a result, we reclassified from equity to derivative liability the fair value of the conversion premium as of May 22, 2018. Amounts paid in excess of the principal amount will be offset by an equal receipt of cash under the corresponding convertible bond hedge. As a result, we reclassified from equity to derivative asset the fair value of the bond hedge as of May 22, 2018. Changes in the fair value of these derivatives are reflected in other expense, net, in our condensed consolidated statements of operations.

The following table summarizes the inputs and assumptions used in the Black-Scholes model to calculate the fair value of the derivative assets and the inputs and assumptions used in the Binomial model to calculate the fair value of the derivative liability associated with the 2019 Notes:

As of May 22, 2018 As of September 30, 2018 
Common stock price $187.09 $274.49 
Exercise price, conversion premium and bond hedge $75.05 $75.05 
Risk-free interest rate 2.47%  2.59%  
Volatility 
30%-35%
30%-35%
Dividend yield —  —  
Annual coupon rate 0.75%  0.75%  
Remaining contractual term (in years) 1.250.89
Schedule of Computation of Basic and Diluted Net Income (Loss) per Share
The following table presents the calculation of weighted average shares used to calculate basic and diluted earnings per share:
Three months ended Nine months ended 
September 30, September 30, 
2018201720182017
Weighted average shares outstanding: 21,148,080 21,070,678 21,188,938 21,006,718 
Dilutive potential common shares: 
Restricted stock 83,427 79,222 68,997 140,340 
Stock options 1,247,940 1,019,342 1,166,777 980,461 
2019 Convertible Senior Notes — 1,334,357 923,650 1,118,456 
Warrants 1,572,969 47,646 1,081,209 15,882 
Shares used to compute diluted income per share 24,052,416 23,551,245 24,429,571 23,261,857 
Potentially dilutive shares excluded from calculation due to anti-dilutive effect 3,125,815 255,101 1,788,709 2,531,219