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Organization, Basis of Presentation, and Summary of Significant Accounting Policies (Tables) | 3 Months Ended
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Aug. 27, 2023
Accounting Policies [Abstract] |
Schedule of Disaggregation of Revenue | The following tables disaggregates revenues by major product lines and services (in thousands):
| Three Months Ended |  |  |
(In thousands) | August 27, 2023 |  | August 28, 2022 |  |  |  |  |
Contact development and manufacturing organization | $ | 21,539 |  |  | $ | 18,268 |  |  |  |  |  |
HA manufacturing | 2,983 |  |  | 5,456 |  |  |  |  |  |
Total | $ | 24,522 |  |  | $ | 23,724 |  |  |  |  |  |
Schedule of Inventories | As of August 27, 2023 and May 28, 2023, inventories consisted of the following (in thousands):
(In thousands) | August 27, 2023 |  | May 28, 2023
Finished goods | $ | 16,476 |  |  | $ | 13,141 |
Raw materials | 18,391 |  |  | 17,735 |
Work in process | 7,281 |  |  | 10,349 |
Inventory reserve | (458) |  |  | (384) |
Total | $ | 41,690 |  |  | $ | 40,841 |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following table summarizes the fair value of the Company’s assets and liabilities that are measured at fair value on a recurring and non-recurring basis (in thousands):
| Fair Value at August 27, 2023 |  | Fair Value at May 28, 2023
| Level 1 |  | Level 2 |  | Level 3 |  | Level 1 |  | Level 2 |  | Level 3
Liabilities: |  |  |  |  |  |  |  |  |  |  |
Debt derivative liability(1) | $ | — |  |  | $ | — |  |  | $ | 64,700 |  |  | $ | — |  |  | $ | — |  |  | $ | 64,900 |
Total liabilities | $ | — |  |  | $ | — |  |  | $ | 64,700 |  |  | $ | — |  |  | $ | — |  |  | $ | 64,900 |
(1) As of August 27, 2023 and May 28, 2023, the fair value of the debt derivative liability is included in non-current liabilities in the Company’s Condensed Consolidated Balance Sheets. The key inputs to the valuation models that were utilized to estimate the fair value of the debt derivative liability were (i) an estimated probability related to the timing of a change in control over the 12 months following the end of the fiscal period; (ii) the estimated probability related to an event of default of the supply agreement with Alcon, as amended, over the 12 months following the end of the fiscal period; and (iii) a risk-adjusted discount rate. The risk adjusted discount rate as of August 27, 2023 and May 28, 2023 were as follows:
|  | August 27, 2023 |  | May 28, 2023 |
Assumptions |  |  |  |  |
Discount rate |  | 22.3% — 24.2% |  | 22.3% — 24.5% |
Implied spread |  | 17.9% |  | 18.5% |
Risk free rate |  | 4.4% — 6.3% |  | 3.8% — 6.0% |
The following table reflects the fair value roll forward reconciliation of Level 3 assets and liabilities measured at fair value for the three months ended August 27, 2023 (in thousands):
| Debt Derivative Liability |  |
Balance as of May 29, 2022 | $ | — |  |  |
Fair value on issuance(1) | 64,900 |  |  |
Balance as of May 28, 2023 | $ | 64,900 |  |  |
Decrease in fair value(2) | (200) |  |  |
Balance as of August 27, 2023 | $ | 64,700 |  |  |
(1)At May 28, 2023, the fair value of the embedded derivative liability approximated the fair value upon issuance on May 22, 2023. (2)For the three months ended August 27, 2023, the decrease in fair value is recorded within “Change in fair value of debt derivative liability, related party” within the condensed consolidated statement of operations.

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- Definition Tabular disclosure of assets and liabilities, including [financial] instruments measured at fair value that are classified in stockholders' equity, if any, that are measured at fair value on a recurring basis. The disclosures contemplated herein include the fair value measurements at the reporting date by the level within the fair value hierarchy in which the fair value measurements in their entirety fall, segregating fair value measurements using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3). + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 + Details
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