0001425450-22-000027 | 10-K | XBRL Viewer

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CONSOLIDATED BALANCE SHEETS € in Thousands	Dec. 31, 2021 USD ($)	Dec. 31, 2020 USD ($)
Current assets:
Cash and cash equivalents	$ 7,641,000	$ 28,758,000
Restricted cash	1,365,000	1,374,000
Short term investments	45,902,000	55,141,000
Accounts receivable - trade, less allowance for doubtful accounts of $347 and $433, respectively	17,942,000	17,212,000
Inventories, net	57,569,000	52,989,000
Notes receivable	0	337,000
Prepaid expenses and other current assets	3,229,000	2,618,000
Total current assets	133,648,000	158,429,000
Property and equipment, net	28,515,000	27,227,000
Other assets:
Amortizable intangible assets, net	55,494,000	50,284,000
Goodwill	72,349,000	70,511,000
Other intangible assets	14,268,000	13,961,000
Total other assets	142,111,000	134,756,000
Total assets	304,274,000	320,412,000
Current liabilities:
Accounts payable - trade	9,325,000	10,038,000
Accrued compensation and benefits	5,351,000	4,540,000
Accrued legal settlements	0	6,342,000
Current portion of long-term debt with affiliate	137,000	131,000
Current portion of acquisition installment payable	12,862,000	12,233,000
Other current liabilities	2,040,000	1,744,000
Total current liabilities	29,715,000	35,028,000
Long-term liabilities:
Long-term debt with affiliate, net of current portion	907,000	1,044,000
Acquisition installment payable, net of current portion	14,309,000	12,784,000
Contingent consideration	28,910,000	30,710,000
Deferred income taxes	4,771,000	5,755,000
Other long-term liabilities	293,000	323,000
Total long-term liabilities	49,190,000	50,616,000
Total liabilities	78,905,000	85,644,000
Commitments and contingencies (Note 16)
Stockholders' equity:
Common stock, $0.00025 par value; 50,000,000 shares authorized; 19,677,214 shares and 19,560,291 shares issued and outstanding as of December 31, 2021 and December 31, 2020	5,000	5,000
Additional paid-in capital	394,899,000	388,622,000
Accumulated deficit	(178,026,000)	(161,766,000)
Accumulated other comprehensive income	8,491,000	7,907,000
Total stockholders' equity	225,369,000	234,768,000
Total liabilities and stockholders' equity	$ 304,274,000	$ 320,412,000

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Statement of Financial Position [Abstract]
Allowance for doubtful accounts	$ 347	$ 433
Common stock, par value (in dollars per share)	$ 0.00025	$ 0.00025
Common stock, shares authorized (in shares)	50,000,000	50,000,000
Common stock, shares issued (in shares)	19,677,214	19,560,291
Common stock, shares outstanding (in shares)	19,677,214	19,560,291

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)	12 Months Ended
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Income Statement [Abstract]
Net revenue	$ 98,049,000	$ 71,078,000	$ 72,552,000
Cost of revenue	24,646,000	16,047,000	17,933,000
Gross profit	73,403,000	55,031,000	54,619,000
Operating expenses:
Sales and marketing	39,673,000	31,854,000	31,284,000
General and administrative	46,061,000	38,317,000	26,664,000
Legal settlement expenses	150,000	6,342,000	0
Research and development	5,543,000	5,273,000	5,748,000
Total operating expenses	91,427,000	81,786,000	63,696,000
Operating loss	(18,024,000)	(26,755,000)	(9,077,000)
Other expenses:
Interest expense, net	2,247,000	3,412,000	3,538,000
Fair value adjustment of contingent consideration	(1,800,000)	3,520,000	0
Other expense (income)	(1,083,000)	(20,000)	70,000
Total other expenses	(636,000)	6,912,000	3,608,000
Loss before income taxes	(17,388,000)	(33,667,000)	(12,685,000)
Provision for income taxes (benefit)	(1,128,000)	(723,000)	0
Net loss from continuing operations	(16,260,000)	(32,944,000)	(12,685,000)
Net loss from discontinued operations	0	0	(1,046,000)
Net loss	$ (16,260,000)	$ (32,944,000)	$ (13,731,000)
Weighted average number of shares - basic (in shares)	19,268,255	18,056,828	14,624,194
Weighted average number of shares - diluted (in shares)	19,268,255	18,056,828	14,624,194
Net loss from continuing operations per share - basic (in dollars per share)	$ (0.84)	$ (1.82)	$ (0.87)
Net loss from continuing operations per share - diluted (in dollars per share)	(0.84)	(1.82)	(0.87)
Net loss from discontinued operations per share - basic (in dollars per share)	0	0	(0.07)
Net loss from discontinued operations per share - diluted (in dollars per share)	0	0	(0.07)
Net loss per share - basic (in dollars per share)	(0.84)	(1.82)	(0.94)
Net loss per share - diluted (in dollars per share)	$ (0.84)	$ (1.82)	$ (0.94)

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Statement of Comprehensive Income [Abstract]
Net loss	$ (16,260)	$ (32,944)	$ (13,731)
Other comprehensive (loss) income:
Foreign currency translation adjustment	1,157	7,857	620
Unrealized gain (loss) on short-term investments	(573)	53	0
Other comprehensive income, net of tax	584	7,910	620
Comprehensive loss	$ (15,676)	$ (25,034)	$ (13,111)

- Definition

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

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+ Details

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-in Capital	Accumulated Deficit	Accumulated Other Comprehensive Income (Loss)
Balance at Dec. 31, 2018	$ 81,732	$ 4	$ 197,442	$ (115,091)	$ (623)
Balance (in shares) at Dec. 31, 2018		14,538,202
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(13,731)			(13,731)
Acquisition consideration	10,000		10,000
Acquisition consideration (in shares)		245,352
Restricted stock	2,603		2,603
Restricted stock (in shares)		145,153
Stock option exercise	$ 1,141		1,141
Stock option exercise (in shares)	38,920	38,921
Issuance of common stock, net of issuance cost	$ 59,996		59,996
Issuance of common stock, net of issuance cost (in shares)		1,755,500
Other comprehensive income	620				620
Balance at Dec. 31, 2019	142,361	$ 4	271,182	(128,822)	(3)
Balance (in shares) at Dec. 31, 2019		16,723,128
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(32,944)			(32,944)
Acquisition consideration	39,388		39,388
Acquisition consideration (in shares)		1,025,782
Restricted stock	6,196		6,196
Restricted stock (in shares)		162,125
Stock option exercise	$ 1,650		1,650
Stock option exercise (in shares)	53,270	53,270
Issuance of common stock, net of issuance cost	$ 70,207	$ 1	70,206
Issuance of common stock, net of issuance cost (in shares)		1,595,986
Other comprehensive income	7,910				7,910
Balance at Dec. 31, 2020	$ 234,768	$ 5	388,622	(161,766)	7,907
Balance (in shares) at Dec. 31, 2020	19,560,291	19,560,291
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	$ (16,260)			(16,260)
Acquisition consideration	298		298
Acquisition consideration (in shares)		4,599
Restricted stock	5,842		5,842
Restricted stock (in shares)		107,902
Stock option exercise	$ 137		137
Stock option exercise (in shares)	4,422	4,422
Other comprehensive income	$ 584				584
Balance at Dec. 31, 2021	$ 225,369	$ 5	$ 394,899	$ (178,026)	$ 8,491
Balance (in shares) at Dec. 31, 2021	19,677,214	19,677,214

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	12 Months Ended
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
OPERATING ACTIVITIES
Net loss	$ (16,260,000)	$ (32,944,000)	$ (13,731,000)
Adjustments to reconcile net loss to net cash used in operating activities:
Loss on sale of discontinued operations	0	0	210,000
Depreciation and amortization	10,680,000	8,010,000	4,671,000
Stock-based compensation	5,842,000	6,196,000	2,603,000
Fair value adjustment of contingent consideration	(1,800,000)	3,520,000	0
Acquisition installment payable	2,154,000	2,397,000	0
Deferred income taxes	(1,128,000)	(723,000)	0
Changes in certain current assets and liabilities:
Accounts receivable - trade	(466,000)	(451,000)	(5,820,000)
Inventories	(5,050,000)	(12,070,000)	(9,767,000)
Prepaid expenses and other current assets	(637,000)	(719,000)	(137,000)
Accrued legal settlements	(6,342,000)	6,342,000	0
Accounts payable - trade	(567,000)	3,071,000	2,401,000
Accrued expenses and other liabilities	1,095,000	(1,074,000)	1,946,000
Other	(584,000)	(85,000)	(1,000)
Net cash used in operating activities - continuing operations	(13,063,000)	(18,530,000)	(17,625,000)
Net cash used by operating activities - discontinued operations	0	0	(144,000)
Net cash used in operating activities	(13,063,000)	(18,530,000)	(17,769,000)
INVESTING ACTIVITIES
Acquisition of Devise Ortho assets	(650,000)	0	0
Acquisition of Telos, net of cash acquired	0	(1,670,000)	0
Acquisition of ApiFix, net of cash acquired	0	(1,723,000)	0
Acquisition of Vilex and Orthex, net of cash acquired	0	0	(49,836,000)
Sale of short term investments	9,250,000	0	0
Purchase of short term investments	0	(55,000,000)	0
Purchases of property and equipment	(8,103,000)	(10,504,000)	(11,816,000)
Net cash used in investing activities	(7,411,000)	(69,693,000)	(61,922,000)
FINANCING ACTIVITIES
Payments on note with affiliate	0	(25,000,000)	0
Proceeds from issuance of debt with affiliate	0	0	30,000,000
Proceeds from issuance of common stock, net of issuance costs	0	70,207,000	59,996,000
Proceeds from exercise of stock options	137,000	1,650,000	1,141,000
Payments on mortgage notes	(131,000)	(125,000)	(118,000)
Net cash provided by financing activities	6,000	46,732,000	91,019,000
Effect of exchange rate changes on cash	(658,000)	(404,000)	8,000
NET INCREASE (DECREASE) IN CASH AND RESTRICTED CASH	(21,126,000)	(41,895,000)	11,336,000
Cash and restricted cash, beginning of period	30,132,000	72,027,000	60,691,000
Cash and restricted cash, end of period	9,006,000	30,132,000	72,027,000
SUPPLEMENTAL DISCLOSURES
Cash paid for interest	56,000	1,233,000	4,229,000
Transfer of instruments from property and equipment to inventory	453,000	415,000	1,037,000
Divestiture consideration allocated to assets held for sale (See Note 4)	0	0	25,000,000
Payment of Term Note B with revolving credit facility (See Note 9)	0	0	5,000,000
Vilex and Orthex
SUPPLEMENTAL DISCLOSURES
Issuance of common shares in acquisition	0	0	10,000,000
Telos
SUPPLEMENTAL DISCLOSURES
Issuance of common shares in acquisition	0	1,568,000	0
ApiFix
SUPPLEMENTAL DISCLOSURES
Issuance of common shares in acquisition	0	35,176,000	0
Band-Lok
SUPPLEMENTAL DISCLOSURES
Issuance of common shares in acquisition	0	2,644,000	0
Devise Ortho
SUPPLEMENTAL DISCLOSURES
Issuance of common shares in acquisition	298,000	0	0
Band-Lok intangible assets
INVESTING ACTIVITIES
Purchases of licenses	0	(796,000)	0
Licenses
INVESTING ACTIVITIES
Purchases of licenses	$ (7,908,000)	$ 0	$ (270,000)

BUSINESS	12 Months Ended
BUSINESS	Dec. 31, 2021
Organization, Consolidation and Presentation of Financial Statements [Abstract]
BUSINESS	BUSINESS OrthoPediatrics Corp., a Delaware corporation, is a medical device company committed to designing, developing and marketing anatomically appropriate implants and devices for children with orthopedic conditions, giving pediatric orthopedic surgeons and caregivers the ability to treat children with technologies specifically designed to meet their needs. We sell our specialized products, including PediLoc®, PediPlates®, Cannulated Screws, PediFlexTM nail, PediNailTM, PediLoc® Tibia, ACL Reconstruction System, Locking Cannulated Blade, Locking Proximal Femur, Spica Tables, RESPONSETM Spine, BandLocTM, Pediatric Nailing Platform \| Femur, Orthex, QuickPackTM and ApiFix® Mid-C System, to various hospitals and medical facilities throughout the United States and various international markets. We currently use a contract manufacturing model for the manufacturing of implants and related surgical instrumentation. We are the only global medical device company focused exclusively on providing a comprehensive trauma and deformity correction, scoliosis and sports medicine product offering to the pediatric orthopedic market in order to improve the lives of children with orthopedic conditions. Since inception we have impacted the lives of over 234,000 children. We design, develop and commercialize innovative orthopedic implants and instruments to meet the specialized needs of pediatric surgeons and their patients, who we believe have been largely neglected by the orthopedic industry. We currently serve three of the largest categories in this market. We estimate that the portion of this market that we currently serve represents a $3,300 opportunity globally, including over $1,500 in the United States. A novel strain of the coronavirus disease was first identified in Wuhan, China in December 2019, and the related outbreak was subsequently declared a pandemic by the World Health Organization and a national emergency by the President of the United States. As a result of the pandemic, we have experienced significant business disruption. For example, in preparation for COVID-19-related hospitalizations, various governments, governmental agencies and hospital administrators have instructed hospitals to postpone some elective procedures. As a majority of our products are utilized in elective surgeries or procedures, the deferrals of such surgeries and procedures have had, and may continue to have, a significant negative impact on our business and results of operations. Despite the impact COVID-19 has had on our business, we continued to invest in research and development, invest in our people, and take steps to position ourselves for long-term success. During 2020, we raised additional capital to solidify our financial foundation. We continued to train and educate our sales team and our surgeons on our products. During 2020 and 2021, we continued to focus on developing innovative solutions, acquired multiple enabling technologies, invested in both new and existing partnerships and continued to deploy additional consigned instrument and implant sets in furtherance of our strategy. The extent to which COVID-19 may continue to negatively impact the Company's consolidated financial position, results of operations or cash flows is uncertain and will be closely monitored.

SIGNIFICANT ACCOUNTING POLICIES

12 Months Ended

Dec. 31, 2021

Accounting Policies [Abstract]

SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying consolidated financial statements include the accounts of OrthoPediatrics Corp. and its wholly-owned subsidiaries, OrthoPediatrics US Distribution Corp., OrthoPediatrics EU Limited, OrthoPediatrics AUS PTY LTD, OrthoPediatrics NZ Limited, OP EU B.V., OP Netherlands B.V., Orthex, LLC, Telos Partners, LLC and ApiFix, Ltd. (collectively, the “Company,” “we,” “our” or “us”). All intercompany balances and transactions have been eliminated. The results of Vilex have been classified as discontinued operations within the consolidated financial statements for the year ended December 31, 2019.

We have prepared the accompanying consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The accompanying consolidated financial statements have been prepared assuming our Company will continue as a going concern. We have experienced

recurring losses from operations since our inception and had an accumulated deficit of $178,026 and $161,766 as of December 31, 2021 and 2020, respectively.

Use of Estimates

Preparation of our consolidated financial statements requires the use of estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, as of the date of the consolidated financial statements. By their nature, these judgments are subject to an inherent degree of uncertainty. We use historical experience and other assumptions as the basis for our judgments and estimates. Because future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates. Any changes in these estimates will be reflected in our consolidated financial statements.

Foreign Currency Transactions

We currently bill our international stocking distributors in U.S. dollars, resulting in minimal foreign exchange transaction expense.

Beginning in early 2017 and continuing through 2021, we expanded operations and established legal entities outside the United States, permitting us to sell under an agency model direct to local hospitals internationally. The countries we serve under the agency model include the United Kingdom, Ireland, Australia, New Zealand, Canada, Belgium, the Netherlands, Poland, Italy, Israel, Germany, Switzerland, and Australia. Additionally, in March 2019, we established an operating company in the Netherlands in order to enhance our operations in Europe. The financial statements of our foreign subsidiaries are accounted for in local functional currencies and have been translated into U.S. dollars using end-of-period exchange rates for assets and liabilities and average exchange rates during each reporting period for results of operations. Foreign currency translation adjustments have been recorded as a separate component of the consolidated statements of comprehensive loss.

Fair Value of Financial Instruments

The accounting standards related to fair value measurements define fair value and provide a consistent framework for measuring fair value under the authoritative literature. Valuation techniques are based on observable and unobservable inputs. Observable inputs reflect readily obtainable data from independent sources, while unobservable inputs reflect market assumptions. This guidance only applies when other standards require or permit the fair value measurement of assets and liabilities. The guidance does not expand the use of fair value measurements. A fair value hierarchy was established, which prioritizes the inputs used in measuring fair value into three broad levels.

Level 1 – Quoted prices in active markets for identical assets or liabilities;

Level 2 – Observable market-based inputs or unobservable inputs that are corroborated by market data; and

Level 3 – Significant unobservable inputs that are not corroborated by market data. Generally, these fair value measures are model-based valuation techniques such as discounted cash flows, and are based on the best information available, including our own data.

The Company's financial instruments include cash and cash equivalents, short-term investments, accounts receivable, accounts payable, acquisition installment payables, contingent consideration and long-term debt. The carrying amounts of accounts receivable, accounts payable, acquisition installment payables and long-term debt approximate the fair value due to the short-term nature or market rates of these instruments. The company bases the fair value of short-term investments on quoted market prices for identical or comparable assets except for investments classified as asset backed securities which we identify as Level 2. These securities are predominately priced by third parties, either a pricing vendor or dealer. When a quoted price in an active market for an identical security is not available these third parties will utilize an alternative market approach, such as a recent trade or matrix pricing, or an income approach, such as a discounted cash flow pricing model that calculates values from observable inputs such as quoted interest rates, yield curves and other observable market information. Contingent consideration represents the system sales payment the Company is obligated to make. The fair value of the contingent consideration payment is considered a level 3 fair value measurement and was determined with the assistance of an independent valuation specialist at the original issuance date and as of the

balance sheet date. See Note 6 for further discussion of financial instruments that carried a fair value on a recurring and nonrecurring basis.

Revenue from Contracts with Customers

In accordance with ASC 606, "Revenue from Contracts with Customers," revenue is recognized when our performance obligations under the terms of a contract with our customer are satisfied. This typically occurs when we transfer control of our products to the customers, generally upon implantation or when title passes upon shipment. The amount of revenue recognized reflects the consideration to which the Company expects to be entitled to receive in exchange for these goods or services, and excludes any sales incentives or taxes collected from a customer which are subsequently remitted to government authorities.

Revenue Recognition – United States

Revenue in the United States is generated primarily from the sale of our implants and, to a much lesser extent, from the sale of our instruments. Sales in the United States are primarily to hospital accounts through independent sales agencies. We recognize revenue when our performance obligations under the terms of a contract with our customer are satisfied. The products are generally consigned to our independent sales agencies, and revenue is recognized when the products are used by or shipped to the hospital for surgeries on a case by case basis. On rare occasions, hospitals purchase product for their own inventory, and revenue is recognized when the products are shipped and the title and risk of loss passes to the customer. Pricing for each customer is dictated by a unique pricing agreement.

Revenue Recognition – International

Outside of the United States, we sell our products directly to hospitals through independent sales agencies or to independent stocking distributors. Generally, the distributors are allowed to return products, and some are thinly capitalized. Based on a history of reliable collections, we have concluded that a contract exists and revenue should be recognized when we transfer control of our products to the customer, generally when title passes upon shipment. Additionally, based on our history of immaterial returns from international customers, we have historically estimated no reserve for returns.

Beginning in early 2017and continuing through 2021, we expanded operations and established legal entities outside the United States, permitting us to sell under an agency model direct to local hospitals internationally. In the year ended December 31, 2020, the Company recorded a $2,730 revenue reduction due to the repurchase of inventory from a stocking distributor in Germany, Austria and Switzerland that we converted to a sales agency. The products are generally consigned to our independent sales agencies, and revenue is recognized when the products are used by or shipped to the hospital for surgeries on a case by case basis. On rare occasions, hospitals purchase products for their own inventory, and revenue is recognized when title passes upon shipment. Pricing for each customer is dictated by a unique pricing agreement.

Cash, Cash Equivalents and Short Term Investments

We maintain cash in bank deposit accounts which, at times, may exceed federally insured limits. To date, we have not experienced any loss in such accounts. We consider all highly liquid investments with original maturity of three months or less at inception to be cash equivalents. The carrying amounts reported in the balance sheets for cash are valued at cost, which approximates fair value.

The Company invests in available-for-sale short term investments. The Company has the ability, if necessary, to liquidate without penalty any of its short term investments to meet its liquidity needs in the next twelve months. As such, those investments with contractual maturities greater than one year from the date of purchase are classified as short-term on the accompanying Consolidated Balance Sheets. The company includes unrealized gains or losses, as a component of other comprehensive income in stockholders' equity. If the adjustment to fair value reflects a decline in the value of the investment, the Company considers available information to determine whether the decline is "other than temporary" and, if so, reflects the change on the Consolidated Statements of Operations. There were no such losses recognized in the accompanying Consolidated Statements of Operations.

Restricted Cash

In conjunction with the sale of Vilex, $1,250 was placed into a separate escrow account. This cash is reported as restricted cash on the December 31, 2021 and 2020 Consolidated Balance Sheets. These funds were to remain restricted until August 31, 2021 at which time, they were to be released to the Company subject to no claims related to the purchase; however, due to the pending IMED Surgical litigation, the cash remains reported as restricted until the conclusion of the legal matter. See Note 16 - Commitments and Contingencies for further detail. The Company also maintains restricted cash of 100 Euro at its Netherlands entity for potential Italian tenders.

Accounts Receivable and Allowance for Doubtful Accounts

Accounts receivable are uncollateralized customer obligations due under normal trade terms, generally requiring payment within 30 days from the invoice date in the United States and within 90 days internationally. Account balances with invoices over 30 or 90 days past due for domestic and international accounts, respectively, are considered delinquent. No interest is charged on past due accounts. Payments of accounts receivable are applied to the specific invoices identified on the customer's remittance advice or, if unspecified, to the customer's account as an unapplied credit.

The carrying amount of accounts receivable is reduced by an allowance that reflects management's best estimate of the amounts that will not be collected, determined principally on the basis of historical experience, management's assessment of the collectability of specific customer accounts and the aging of the accounts receivable. All accounts or portions thereof deemed to be uncollectible or to require an excessive collection cost are written off to the allowance for doubtful accounts. The allowance for doubtful accounts was $347 and $433 as of year ended December 31, 2021 and 2020, respectively.

The following table summarizes activity in the allowance for doubtful accounts:


	December 31,
	2021		2020		2019
Balance at beginning of year	$	433	$	506	$	134
Adjustments charged to expense (income)	(5)		274		424
Write-offs	81		347		52
Balance at end of year	$	347	$	433	$	506

Inventories, net

Inventories are stated at the lower of cost or net realizable value, with cost determined using the first-in-first-out method. Inventories, which consist of implants and instruments held in our warehouse, with third-party independent sales agencies or distributors, or consigned directly with hospitals, are considered finished goods and are purchased from third parties.

We evaluate the carrying value of our inventories in relation to the estimated forecast of product demand, which takes into consideration the life cycle of the product. A significant decrease in demand could result in an increase in the amount of excess inventory on hand, which could lead to additional charges for excess and obsolete inventory.

The need to maintain substantial levels of inventory impacts our estimates for excess and obsolete inventory. Each of our implant systems are designed to include implantable products that come in different sizes and shapes to accommodate the surgeon’s needs. Typically, a small number of the set components are used in each surgical procedure. Certain components within each set may become obsolete before other components based on the usage patterns. We adjust inventory values, as needed, to reflect these usage patterns and life cycle.

In addition, we continue to introduce new products, which may require us to take additional charges for excess and obsolete inventory in the future.

Charges for excess and obsolete inventory are included in cost of revenue and were $1,100, $1,269 and $604 for the years ended December 31, 2021, 2020 and 2019, respectively.

Costs Related to Common Stock Offerings

On December 13, 2019, we completed a public offering of our common stock. Offering expenses of $235, primarily consisting of legal, accounting and other direct fees and costs related to the offering were recorded in stockholders' equity at the conclusion of our offering.

On June 22, 2020, we completed another public offering of our common stock. Offering expenses of $481, primarily consisting of legal, accounting and other direct fees and costs related to the offering were recorded in stockholders' equity at the conclusion of our offering.

Property and Equipment, net

Property and equipment are carried at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful life of the assets. When assets are retired or otherwise disposed of, costs and related accumulated depreciation are removed from the accounts, and any resulting gain or loss is recognized in operations for the period. Maintenance and repairs that prolong or extend the useful life are capitalized, whereas standard maintenance, replacements, and repair costs are expensed as incurred.

Instruments are hand-held devices, specifically designed for use with our implants and are used by surgeons during surgery. Instruments deployed in the field are carried at cost less accumulated depreciation and are recorded in property and equipment, net on the consolidated balance sheets.

Sample inventory consists of our implants and instruments, and is maintained to market and promote our products. Sample inventory is carried at cost less accumulated depreciation.

Depreciable lives are generally as follows:


Building and building improvements			25 to 30 years
Furniture and fixtures			5 to 7 years
Computer equipment			3 to 5 years
Business software			3 years
Office and other equipment			5 to 7 years
Instruments			5 years
Sample inventory			2 years

Amortizable Intangible Assets, net

Amortizable intangible assets include fees necessary to secure various patents and licenses, including Band-Lok, the value of internally developed software, customer relationships, and non-competition agreements related to the acquisition of Orthex, and customer relationships and non-competition agreements related to the acquisitions of Telos and ApiFix. Amortization is calculated on a straight-line basis over the estimated useful life of the asset. Amortization for patents and licenses commences at the time of patent approval, and for licenses upon market launch, respectively. Amortization for assets acquired commences upon acquisition. Intangible assets are amortized over a 3 to 20 year period.

Amortizable intangible assets are assessed for impairment upon triggering events that indicate that the carrying value of an asset may not be recoverable. Recoverability is measured by a comparison of the carrying amount to future net undiscounted cash flows expected to be generated by the associated asset. If such assets are determined to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount exceeds the fair market value of the intangible assets. No impairment charges were recorded in any of the periods presented.

Goodwill and Other Intangible Assets

Our goodwill represents the excess of the cost over the fair value of net assets acquired. The determination of the value of goodwill and intangible assets arising from acquisitions requires extensive use of accounting estimates and judgments to allocate the purchase price to the fair value of net tangible and intangible assets acquired. Goodwill is not amortized and is assessed for impairment using fair value measurement techniques on an annual

basis or more frequently if facts and circumstances warrant such a review. The goodwill is considered to be impaired if we determine that the carrying value of our one reporting unit exceeds its respective fair value. No impairment changes were recorded in the current year.

The Company tests goodwill for impairment by either performing a qualitative evaluation or a quantitative test. The quantitative assessment for goodwill requires us to estimate the fair value of our one reporting unit using either an income or market approach or a combination thereof.

We have indefinite lived trademark assets that are reviewed for impairment by performing a quantitative analysis, which occurs annually in the fourth quarter, utilizing balances as of October 1, or whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. Recoverability is measured by a comparison of the carrying amount to future net discounted cash flows expected to be generated by the associated asset. If such assets are determined to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount exceeds the fair market value of the assets. No impairment charges were recorded in any of the periods presented.

Acquisition Payable and Contingent Consideration

Upon the completion of an acquisition the Company may record an acquisition installment payable, contingent consideration or both. Both are recorded at their fair values as determined by management with the assistance of an independent valuation specialist at the original issuance date and are adjusted on a recurring basis. Accretion of interest expense attributable to the acquisition installment payable are recorded as a component of interest expense, net. Changes in the fair value of the contingent consideration are included in fair value adjustments of contingent consideration. Both are included as a component of other expenses on the consolidated statement of operations. The amount of expense recorded in interest expense, net was $2,155 and $2,397 for the twelve month period ended December 31, 2021 and 2020, respectively. Adjustments in the fair value of the contingent consideration payment were recognized as income of $1,800 and expense of $3,520 for the twelve month period ended December 31, 2021 and 2020, respectively.

Shipping and Handling Costs

Shipping and handling costs that are billed to the customer are included in net revenue and were $803, $635 and $599, for the years ended December 31, 2021, 2020 and 2019, respectively. Shipping and handling costs that are not billed to the customer are included in sales and marketing expenses and were $2,899, $2,261 and $2,788, for the years ended December 31, 2021, 2020 and 2019, respectively.

Cost of Revenue

Cost of revenue consists primarily of products purchased from third-party suppliers, excess and obsolete inventory adjustments, inbound freight, and royalties. Our implants and instruments are manufactured to our specifications by third-party suppliers who meet our manufacturer qualifications standards. Our third-party manufacturers are required to meet Food and Drug Administration (the “FDA”), International Organization for Standardization and other country-specific quality standards. The majority of our implants and instruments are produced in the United States.

Sales and Marketing Expenses

Sales and marketing expenses primarily consist of commissions to our domestic and select international independent sales agencies and consignment distributors, as well as compensation, commissions, benefits and other related costs for personnel we employ. Commissions and bonuses are generally based on a percentage of sales. Our international independent stocking distributors purchase instrument sets and replenishment stock for resale, and we do not pay commissions or any other sales related costs for international sales to distributors.

Advertising Costs

Advertising costs consist primarily of print advertising, trade shows, and other related expenses. Advertising costs are expensed as incurred and are recorded as a component of sales and marketing expense. Advertising costs were $898, $1,231 and $1,422 for the years ended December 31, 2021, 2020 and 2019, respectively.

Research and Development Costs

Research and development costs are expensed as incurred. Our research and development expenses primarily consist of costs associated with engineering, product development, consulting services, outside prototyping services, outside research activities, materials, development and protection of our intellectual property portfolio, as well as other costs associated with development of our products. Research and development costs also include related personnel and consultants’ compensation expense.

Stock-Based Compensation

Prior to our IPO, we maintained an Amended and Restated 2007 Equity Incentive Plan (the “2007 Plan”) that provides for grants of options and restricted stock to employees, directors and associated third-party representatives of our company as determined by the Board of Directors. The 2007 Plan had authorized 1,585,000 shares for award.

Immediately prior to our IPO, we adopted our 2017 Incentive Award Plan (the “2017 Plan”) which replaced the 2007 Plan. The 2017 Plan provides for grants of options and restricted stock to officers, employees, consultants or directors of our Company. The 2017 Plan has authorized 1,832,460 shares for award.

Options holders, upon vesting, may purchase common stock at the exercise price, which is the estimated fair value of our common stock on the date of grant. Option grants generally vest immediately or over a three year period. No stock options were granted in any of the periods presented.

Restricted stock may not be transferred prior to the expiration of the restricted period. The restricted stock that has been granted under the 2007 Plan has restriction periods that generally last until the earlier of six years from the date of grant, or an initial public offering or change in control, as defined in the 2007 Plan. All restricted stock granted prior to May 2014 vested upon our IPO and the remaining grants under the 2007 Plan vested in April 2018. Generally under the 2017 plan, restricted stock vests over a three year period. We have elected to recognize the reversal of stock compensation expense when a restricted stock forfeiture occurs as opposed to estimating future forfeitures.

We record the fair value of restricted stock at the grant date. Stock-based compensation is recognized ratably over the requisite service period, which is generally the restriction period for restricted stock.

In determining the fair value of our common stock at the grant date for awards issued prior to our IPO, which is the basis for the fair value of stock based awards, we use the market approach, which is based on the assumption that the value of an asset is equal to the value of a substitute asset with the same characteristics. In using the market approach, we consider both the guideline public company method and the precedent transaction method. Given the absence of a public trading market for our common stock at that time, we exercise reasonable judgment and consider a number of objective and subjective factors to determine the best estimate of the fair value of our common stock, including: the preferences and dividends of our redeemable convertible preferred stock relative to those of our common stock; our operating results and financial conditions, including our level of available capital resources; equity market conditions affecting comparable public companies; general U.S. market conditions; and the lack of marketability of our common stock. Prior to our IPO, for restricted stock awards we applied a discount for lack of marketability to the fair value of common shares due to estimate the impact of valuing a minority interest in our Company as a closely held, non-public company with no liquid market for its shares.

Foundation for Advancing Pediatric Orthopedics

The Company may periodically make contributions to the Foundation for Advancing Pediatric Orthopedics (the "Foundation"). The Foundation was incorporated in 2018 exclusively for pediatric orthopedic research and education and qualifies under IRC 501(c)(3) as an exempt private foundation. The mission of the Foundation is to enhance the knowledge and experience, through education and research, of surgical trainees or practicing surgeons who are involved in helping children with orthopaedic disorders and injuries. The Foundation is a separate legal entity and is not a subsidiary of the Company; therefore, its results are not included in these consolidated financial statements. The Company contributed $88, $325 and $500 to the Foundation during the years ended December 31, 2021, 2020 and 2019, respectively. These contributions were recorded in general and administrative expenses.

Comprehensive Income (Loss)

Comprehensive income (loss) is defined as the change in equity during a period from transactions and other events and circumstances from non-owner sources. Comprehensive income (loss) includes foreign currency translation adjustments and unrealized gains (losses) on marketable securities.

Income Taxes

We account for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, we determine deferred tax assets and liabilities on the basis of the differences between the financial statement and tax bases of assets and liabilities by using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date.

We recognize deferred tax assets to the extent that we believe that these assets are more likely than not to be realized. In making such a determination, we consider all available positive and negative evidence. If we determine that we would be able to realize our deferred tax assets in the future in excess of their net recorded amount, we would make an adjustment to the valuation allowance.

We record uncertain tax positions on the bases of a two-step process in which (1) we determine whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the positions and (2) for those tax positions that do not meet the more-likely-than-not recognition threshold, we recognize the largest amount of tax benefit that is more than 50% likely to be realized upon ultimate settlement with the related tax authority.

Litigation and Contingencies

Accruals for litigation and contingencies are reflected in the consolidated financial statements based on

management’s assessment, including advice of legal counsel, of the expected outcome of litigation or other dispute resolution proceedings and/or the expected resolution of contingencies. Liabilities for estimated losses are accrued if the potential loss from any claim or legal proceeding is considered probable and the amount can be reasonably estimated. Significant judgment is required in both the determination of probability of loss and the determination as to whether the amount is reasonably estimable. Accruals are based only on information available at the time of the assessment due to the uncertain nature of such matters. As additional information becomes available, management reassesses potential liabilities related to pending claims and litigation and may revise its previous estimates, which could materially affect the Company’s results of operations in a given period. No accrued legal fees outside the course of ordinary business were recorded for the year ended December 31, 2021. The Company recorded an accrual of $6,342 for legal settlements for the year ended December 31, 2020. During 2021, there were no material adjustments to the accrued legal settlements recorded in 2020 and the settlement amounts were paid, resolving the related legal proceedings.

Leases

At the inception of a contractual arrangement, the Company determines whether the contract contains a lease by assessing whether there is an identified asset and whether the contract conveys the right to control the use of the identified asset in exchange for consideration over a period of time. If both criteria are met, the Company calculates the associated lease liability and corresponding right-of-use asset upon lease commencement using a discount rate based on a borrowing rate commensurate with the term of the lease.

The Company records lease liabilities within current liabilities or long-term liabilities based upon the length of time associated with the lease payments. The Company records its operating lease right-of-use assets as long-term assets.

“Emerging Growth Company” Reporting Requirements

We qualify as an “emerging growth company” as defined in the JOBS Act. "Emerging growth companies" may take advantage of specified reduced reporting and other regulatory requirements that are generally unavailable to other public companies. Among other things, we are not required to provide an auditor attestation report on the

Section 107 of the JOBS Act also provides that an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have irrevocably elected not to avail ourselves of this exemption from new or revised accounting standards and, therefore, we will be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies.

Recent Accounting Pronouncements

In June 2016, the FASB issued ASU No. 2016-13 "Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments". The ASU is intended to improve financial reporting by requiring timelier recording of credit losses on loans and other financial instruments held by financial institutions and other organizations. The ASU requires the measurement of all expected credit losses for financials assets including trade receivables held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Financial institutions and other organizations will now use forward-looking information to better inform their credit loss estimates. The Company will adopt ASU 2016-16 effective January 1, 2023. The adoption of this guidance is not expected to have a significant impact on the Company's consolidated financial statements and related disclosures.

In May 2021, the FASB issued ASU No. 2021-04 "Earnings Per Share (Topic 260), Debt-Modifications and Extinguishments (Subtopic 470-50), Compensation-Stock Compensation (Topic 718), and Derivatives and Hedging-Contracts in Entity's Own Equity (Subtopic 815-40): Issuer's Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options (a consensus of the FASB Emerging Issues Task Force)". This ASU is intended to clarify and reduce diversity in an issuer's accounting for modifications or exchanges of freestanding equity-classified written call options (for example, warrants) that remain equity classified after modification or exchange. The guidance clarifies whether an issuer should account for a modification or an exchange of a freestanding equity-classified written call option that remains equity classified after modification or exchange as (1) an adjustment to equity and, if so, the related earnings per share effects, if any, or (2) an expense and, if so, the manner and pattern of recognition. The amendments in this ASU affect all entities that issue freestanding written call options that are classified in equity. The amendments do not apply to modifications or exchanges of financial instruments that are within the scope of another Topic and do not affect a holder’s accounting for freestanding call options. The amendments in this ASU are effective for all entities for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. An entity should apply the amendments prospectively to modifications or exchanges occurring on or after the effective date of the amendments. Early adoption is permitted for all entities, including adoption in an interim period. The Company will adopt ASU 2021-04 effective January 1, 2022. The adoption of this guidance is not expected to have a material impact on the Company's consolidated financial statements and related disclosures.

In October 2021, the FASB issued ASU No. 2021-08 "Business Combinations (Topic 805)-Accounting for Contract Assets and Contract Liabilities from Contracts with Customers". The amendments in this Update address diversity and inconsistency related to the recognition and measurement of contract assets and contract liabilities acquired in a business combination. The amendments in this Update require that an acquirer recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Topic 606, Revenue from Contracts with Customers. The amendments in this Update require that an entity (acquirer) recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Topic 606. For public business entities, the amendments in this Update are effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. The amendments in this Update should be applied prospectively to business combinations occurring on or after the effective date of the amendments. Early adoption of the amendments is permitted, including adoption in an interim period. An entity that early adopts in an interim period should apply the amendments (1) retrospectively to all business combinations for which the acquisition date occurs on or after the beginning of the fiscal year that includes the interim period of early application and (2) prospectively to all business combinations that occur on or after the date of initial application. The Company is currently evaluating the impact of adopting ASU 2021-08 on its consolidated financial statements.

BUSINESS COMBINATIONS

12 Months Ended

Dec. 31, 2021

Business Combination and Asset Acquisition [Abstract]

BUSINESS COMBINATION

BUSINESS COMBINATIONS

ApiFix

On April 1, 2020, the Company purchased all the issued and outstanding membership interest of ApiFix for $2,000 in cash, including $344 of cash acquired, 934,783 shares of the Company's common stock, $0.00025 par value per share, representing approximately $35,176 (based on a closing share price of $37.63 on April 1, 2020), approximately $30,000 in anniversary payments, and approximately $41,741 in a system sales payment. The total consideration transferred of $87,379, as calculated after discounting future payments to present value, is final. ApiFix, a corporation organized under the laws of Israel, has developed a minimally invasive deformity correction system for patients with Adolescent Idiopathic Scoliosis ("ApiFix System"). The following table reconciles the total consideration transferred after discounting the future payments:


	Consideration		Present Value
Cash consideration	$	2,000	$	2,000
Payment of ApiFix transaction related costs	67		67
Issuance of common stock	35,176		35,176
Anniversary Payments	30,000		22,620
System sales payment	41,741		27,190
Total consideration transferred	$	108,984	$	87,053

The Company incurred $311 of acquisition-related costs that are included in general and administrative expenses on the consolidated statements of operations. The purchase price allocation set forth herein is final.

The following table summarizes the total consideration paid for ApiFix and allocation of purchase price to the final fair value of the assets acquired and liabilities assumed at the acquisition date (in thousands):


Description	Amount
Fair value of total acquisition consideration	$	87,379
Assets
Cash	344
Accounts receivable-trade	245
Inventories	685
Prepaid expenses and other current assets	77
Property and equipment	153
Amortizable intangible assets	32,150
Other intangible assets	8,640
Operating lease right-of-use asset	104
Total assets	42,398
Liabilities
Accounts payable and accrued liabilities	226
Operating lease liabilities	106
Other current liabilities	270
Deferred income taxes	6,487

Total liabilities	7,089
Less: total net assets	35,309
Goodwill	$	52,070

The fair value of identifiable intangible assets were based on valuations using a combination of the income and cost approach, inputs which would be considered Level 3 under the fair value hierarchy. The estimated fair value

and useful life of identifiable intangible assets are as follows:


	Amount		Remaining Economic Useful Life
Trademarks / Names	$	8,640	Indefinite
Patents	31,720		15 years
Customer Relationships	230		10 years
Non-competition Agreements	200		4 years
	$	40,790

The Company is obligated to make anniversary payments of: (i) approximately $13,000 on the second anniversary of the closing date, provided that such payment will be paid earlier if 150 clinical procedures using the ApiFix System are completed in the United States before such anniversary date, (ii) $8,000 on the third anniversary of the closing date; and (iii) $9,000 on the fourth anniversary of the closing date, subject to adjustments. The Company anticipates making the second anniversary payment of $13,000 on the anniversary date. In addition, to the extent that the product of our revenues from the ApiFix System for the twelve months ended June 30, 2024 multiplied by 2.25 exceeds the anniversary payments actually made for the third and fourth years, we have agreed to pay the selling shareholders a system sales payment in the amount of such excess. The anniversary payments and system sales payment may each be made in cash or cash and common stock, subject to certain limitations; provided that the Company makes the determination with respect to anniversary payments and a representative of the former ApiFix shareholders may make the determination with respect to the system sales payment, if any. Pursuant to the acquisition agreement, both the anniversary installments and the system sales payment require a minimum cash payment of 25 percent of the total amount due. The remaining 75 percent may be paid with common stock.

The fair value of the contingent consideration payment is considered a Level 3 fair value measurement and was determined with the assistance of an independent valuation specialist at the original issuance date using an option pricing model and a Monte Carlo simulation based on forecasted annual revenue, expected volatility and discount rates. The fair value of the payment will continue to be adjusted as additional information becomes available regarding the progress toward achievement of the revenue forecast. The adjustments in the fair value of the contingent consideration payment were recognized as income of $1,800 and expense of $3,520 for the twelve month period ended December 31, 2021 and 2020, respectively, in other expenses on the consolidated statements of operations. An additional $2,155 and $2,397 was recognized as interest expense for the twelve month period ended December 31, 2021 and 2020, respectively, on the consolidated statements of operations for the accretion of the acquisition installment payable.

Presented below is a summary of the present value of the anniversary payments and fair value of the system sales payment related to the ApiFix acquisition:


	December 31, 2021		December 31, 2020		April 1, 2020
Anniversary Payments:
Second Year Payment	$	12,862	$	12,233	$	10,980
Third Year Payment	7,075		6,335		5,780
Fourth Year Payment	7,234		6,449		5,860
Total acquisition installment payable	27,171		25,017		22,620
Less: current portion of acquisition installment payable	12,862		12,233		10,980
Acquisition installment payable, net of current portion	14,309		12,784		11,640
System sales payment	28,910		30,710		27,190
ApiFix future consideration, net of current portion	$	43,219	$	43,494	$	38,830

Pre-acquisition revenues and earnings for ApiFix were not material to the consolidated operations.

Telos

On March 9, 2020, the Company purchased the issued and outstanding membership interest of Telos for $1,750 in cash, including $81 of cash acquired, and 36,628 shares of common stock, $0.00025 par value per share, of the Company. The shares of common stock were valued at $42.81 per share, the Company's closing share price on March 9, 2020. The Company incurred $25 of acquisition-related costs, that are included in general and

administrative expenses on the consolidated statements of operations. The purchase price allocation set forth herein is final.

The following table summarizes the total consideration paid for Telos and allocation of purchase price to the final fair value of the assets acquired and liabilities assumed at the acquisition date (in thousands):


Description	Amount
Fair value of total acquisition consideration	$	3,318
Assets
Cash	81
Accounts receivable-trade	215

Prepaid expenses and other current assets	38
Property and equipment	10
Amortizable intangible assets	950
Other intangible assets	$	210
Total assets	1,504
Liabilities
Accounts payable and accrued liabilities	60



Total liabilities	60
Less: total net assets	1,444
Goodwill	$	1,874


	Amount		Remaining Economic Useful Life
Trademarks / Names	$	210	Indefinite
Customer Relationships	910		10 years
Non-competition Agreements	40		5 years
	$	1,160

Vilex and Orthex

On June 4, 2019, the Company purchased all the issued and outstanding shares of stock of Vilex and units of membership interests in Orthex for $50,000 in cash, net of working capital adjustments, and 245,352 shares of common stock, $0.00025 par value per share, of the Company. The shares of common stock were valued at $40.76 per share, the volume weighted average trading price during the thirty day trading period ending on May 30, 2019. In addition, $3,000 was placed in an escrow account for a period of up to twenty months to cover certain indemnification obligations and to secure certain closing adjustments. The Company incurred $737 of acquisition-related costs, that are included in general and administrative expenses on the consolidated statements of operations. The purchase price allocation set forth herein is final.

The following table summarizes the total consideration paid for Vilex and Orthex and allocation of purchase price to the final fair value of the assets acquired and liabilities assumed at the acquisition date:


Description	Amount
Fair value of total acquisition consideration	$	60,184
Assets
Cash	348
Accounts receivable-trade	2,088
Inventories	3,652
Prepaid expenses and other current assets	12
Property and equipment	7,540
Amortizable intangible assets	31,180

Operating lease right-of-use asset	323
Total assets	45,143
Liabilities
Accounts payable and accrued liabilities	563
Operating lease liabilities	323
Deferred tax liability	1,175
Other long-term liabilities	68
Total liabilities	2,129
Less: total net assets	43,014
Goodwill	$	17,170


	Amount		Remaining Economic Useful Life
Trademarks / Names	$	4,610	Indefinite
Patents	22,390		15 years
Internally Developed Software	1,550		10 years
Customer Relationships	2,570		12 years
Non-competition Agreements	60		5 years
	$	31,180

Pro forma net revenue and net loss from continuing operations for 2019 and 2018 assuming the acquisition occurred on January 1, 2018 would have been $74,488 and $62,607 and ($12,601) and ($13,439), respectively.

The Company recorded a measurement period adjustment during fiscal 2020 to increase inventory and decrease goodwill related to working capital adjustments to allocate inventory between Orthex and Vilex.

Since the Vilex products include adult offerings that are not core to the Company's pediatric business, the Company received Board approval to take the steps necessary to divest the non-core Vilex assets.

On December 31, 2019, the Company divested substantially all of the assets relating to Vilex's adult product offering to a wholly-owned subsidiary of Squadron Capital, LLC in exchange for a $25,000 reduction in a term note owed to Squadron in connection with the initial acquisition along with certain ongoing intellectual property rights. Of the $25,000 purchase price, $12,410 was attributable to the license of the Orthex intellectual property and the remaining $12,590 was applied to the Vilex assets and liabilities divested.

DISCONTINUED OPERATIONS

12 Months Ended

Dec. 31, 2021

Discontinued Operations and Disposal Groups [Abstract]

DISCONTINUED OPERATIONS

On June 4, 2019, the Company acquired Vilex, a manufacturer of foot and ankle surgical implants. Since the Vilex products include adult offerings that are not core to the Company's pediatric business, the Company received Board approval to take the steps necessary to divest the non-core Vilex assets.

On December 31, 2019, the Company divested substantially all of the assets relating to Vilex's adult product offering to a wholly-owned subsidiary of Squadron Capital, LLC. in exchange for a $25,000 reduction in a term note owed to Squadron in connection with the initial acquisition along with the sale of intellectual property rights.

Assets and liabilities divested consisted of the following as of December 31, 2019:


Description	Amount
Cash	$	515
Accounts Receivable - trade, less allowance for doubtful accounts	928
Inventories, net	2,060
Prepaid expenses and other current assets	24
Property and equipment, net	6,246
Amortizable intangible assets	13,390
Goodwill	3,397
Other intangible assets	380
Operating lease right-of-use asset	216
Total assets divested	$	27,156

Accounts payable - trade	$	37
Accrued compensation and benefits	171
Operating lease liabilities	199
Deferred tax liability	1,175
Other current liabilities	13
Total liabilities divested	$	1,595
Net assets sold	$	25,561
Allocated purchase price	25,000
Loss on divestiture	$	(561)


Major classes of line items constituting loss of discontinued operations	2019
Net revenue	$	3,069
Cost of revenue	(286)
Sales and marketing	(692)
General and administrative	(2,103)
Other income (expense), net	(9)
Pretax net loss of discontinued operations	$	(21)
Income tax expense	(464)
Net loss on discontinued operations	$	(485)

The divestiture does not represent a strategic shift that will have a major effect on the Company's operations and financial statements. Goodwill was allocated to the assets and liabilities divested using the relative fair value method. The Company recognized a total net loss on discontinued operations of $1,046, net of taxes, in its consolidated statement of operations for the year ended December 31, 2019.

GOODWILL AND INTANGIBLE ASSETS

12 Months Ended

Dec. 31, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL AND INTANGIBLE ASSETS

Goodwill

The Company tests goodwill for impairment by either performing a qualitative evaluation or a quantitative test.

The qualitative evaluation is an assessment of factors including reporting unit specific operating results as well as industry, market and general economic conditions, to determine whether it is more likely than not that the fair values of a reporting unit is less than its carrying amount, including goodwill. The Company may elect to bypass the qualitative assessment for its one reporting unit and perform a quantitative test. The assumptions used in evaluating goodwill for impairment are subject to change and are tracked against historical results by management.

The Company elected to perform a qualitative analysis for its reporting unit as of October 1, 2021. The Company determined, after performing the qualitative analysis that there was no evidence that it is more likely than not that the fair value of its reporting unit was less than the carrying amount, therefore, it was not necessary to perform a quantitative impairment test.

Changes in the carrying amount of goodwill were as follows:


	Total
Goodwill at January 1, 2020	$	13,773
Telos acquisition	1,874
Orthex measurement period adjustment	(688)
ApiFix acquisition	52,070
Foreign currency translation impact	3,482
Goodwill at January 1, 2021	$	70,511



Foreign currency translation impact	1,838
Goodwill at December 31, 2021	$	72,349

Intangible Assets

As of December 31, 2021, the balances of amortizable intangible assets were as follows:


	Weighted-Average Amortization Period	Gross Intangible Assets		Accumulated Amortization		Net Intangible Assets
Patents	13.7 years	$	44,493	$	(5,664)	$	38,829
Intellectual Property	10.1 years	9,847		(1,408)		8,439
License agreements	5.5 years	10,674		(2,448)		8,226
Total amortizable assets		$	65,014	$	(9,520)	$	55,494

As of December 31, 2020, the balances of amortizable intangible assets were as follows:


	Weighted-Average Amortization Period	Gross Intangible Assets		Accumulated Amortization		Net Intangible Assets
Patents	14.7 years	$	43,363	$	(2,650)	$	40,713
Intellectual Property	10.3 years	8,990		(744)		8,246
License agreements	2.7 years	2,765		(1,440)		1,325
Total amortizable assets		$	55,118	$	(4,834)	50,284

Amortization expense was $4,531, $3,246 and $887 for the years ended December 31, 2021, 2020 and 2019, respectively. Future amortization expenses are expected as follows:


Year Ending December 31:
2022	$	5,216
2023	5,245
2024	5,144
2025	4,954
2026	4,936
Thereafter	29,999
	$	55,494

Licenses are tied to product launches and do not begin amortizing until the product is launched to the market. Anticipated market launch is in 2022 through 2024 for products for which we previously obtained licensing.

On October 20, 2021, we purchased certain intellectual property assets from Devise Ortho, Inc. related to its Drive Rail external fixation system. We recorded $840 which will be amortized over the life of the patents, or approximately 16 years. In addition to the intellectual property, the Company purchased $108 of inventory from Devise Ortho, Inc. The total consideration of $948 was paid using $650 in cash and 4,599 shares of the Company's common stock, representing approximately $298 (based on the closing share price of $64.83 on October 20, 2021).

On September 3, 2021, we entered into a five-year license agreement, resulting in exclusive distribution rights of the 7D Surgical FLASHTM Navigation platform for pediatric applications. We paid $750 which will be amortized over the initial three years of the agreement.

On July 20, 2021, we entered into an amended license agreement, resulting in a five-year extension of our exclusive distribution rights of the FIREFLY Technology in children's hospitals across the United States. We paid $4,300 for the amended agreement and the amount will be amortized over the life of the agreement.

On March 19, 2021, we recorded a license agreement in the amount of $2,858 in settlement of the Barry legal matter. Amortization is recorded based on the cases completed in the given period.

On June 10, 2020, we purchased certain intellectual property assets from Band-Lok, LLC, a North Carolina limited liability company ("Band-Lok"), related to its Tether Clamp and Implantation System ("Tether Clamp System") for $3,394 in total consideration. We use the Tether Clamp System in connection with our Bandloc 5.5/6.0 System. We were previously the sole licensee of the purchased assets under a license agreement with Band-Lok.

Trademarks are recorded as indefinite-lived intangible assets in the amounts of $14,268 and $13,961 as of December 31, 2021 and 2020, respectively. Concurrently with our acquisition of each company, we acquired the trademark of Orthex on June 4, 2019 valued at $4,230, the trademark of Telos on March 9, 2020 valued at $210 and the trademark of ApiFix on April 1, 2020 valued at $8,640. Trademarks are recorded in Other Intangible assets on the Consolidated Balance Sheets. The change in balance during 2021 was the result of foreign currency translation of the ApiFix trademark.

The Company tests intangible assets with indefinite lives for impairment annually on October 1st or whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. Recoverability is measured by a comparison of the carrying amount to the estimated fair value of the asset, as represented by the net discount future cash flows expected to be generated by the associated asset. If such assets are determined to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount exceeds the fair market value of the intangible assets. Based upon the Company's analysis, no impairment chargers were recorded to its intangible assets.

FAIR VALUE OF FINANCIAL INSTRUMENTS

12 Months Ended

Dec. 31, 2021

Fair Value Disclosures [Abstract]

FAIR VALUE OF FINANCIAL INSTRUMENTS

FAIR VALUE OF FINANCIAL INSTRUMENTSThe Company measures certain financial assets and liabilities at fair value. The accounting standards related to fair value measurements define fair value and provide a consistent framework for measuring fair value under the authoritative literature.

The following table summarize the assets and liabilities measured at fair value on a recurring basis as of December 31, 2021 and 2020, respectively.


	December 31, 2021
	Level 1		Level 2		Level 3		Total
Financial Assets

Short term investments

Corporate Bonds	$	22,476	$	—	$	—	$	22,476
Treasury Bonds	$	14,317	$	—	$	—	$	14,317
Asset Backed Securities	$	—	$	8,272	$	—	$	8,272
Other	$	837	$	—	$	—	$	837
Financial Liabilities
Contingent Consideration	$	—	$	—	$	28,910	$	28,910
	December 31, 2020
	Level 1		Level 2		Level 3		Total
Financial Assets
Cash Equivalents	$	15,002	$	—	$	—	$	15,002
Short term investments
Exchange Trade Mutual Funds	$	35,208	$	—	$	—	$	35,208
Corporate Bonds	$	9,616	$	—	$	—	$	9,616
Treasury Bonds	$	6,520	$	—	$	—	$	6,520
Other	$	3,797	$	—	$	—	$	3,797
Financial Liabilities			$	—	$	—
Contingent Consideration	$	—	$	—	$	30,710	$	30,710

The Company's level 1 assets consist of cash equivalents which are generally comprised of short-term, liquid investments with original maturity of three months or less at inception and other short term investments which are comprised of exchange traded mutual funds and marketable securities with a maturity date greater than 3 months.

The Company's level 2 asset pertains to certain asset-backed securities, collateralized by non-mortgage-related consumer debt. These securities are predominately priced by third parties, either by a pricing vendor or dealer.

The Company's Level 3 instrument consists of contingent consideration. The fair value of the contingent consideration liability assumed in business combinations is recorded as part of the purchase price consideration of the acquisition and is determined using a discounted cash flow model or probability simulation model. The significant inputs of such models are not always observable in the market, such as forecasted annual revenues, expected volatility and discount rates. The adjustments in the fair value of the contingent consideration payments resulted in income of $1,800 and expense of $3,520 for the year ended December 31, 2021 and 2020, respectively. No expense was recorded in 2019.

The following table summarizes the change in fair value of the Level 3 instrument:


	Total
Balance at January 1, 2020	$	—
Contingent consideration recorded as a result of the acquisition (Note 3)	27,190
Increase in fair value of contingent consideration	3,520
Balance at December 31, 2020	$	30,710
Decrease in fair value of contingent consideration	(1,800)
Balance at December 31, 2021	$	28,910

The recurring Level 3 fair value measurements of the contingent consideration liability associated with the ApiFix system sales milestone include the following significant unobservable inputs as of December 31, 2021, 2020 and the date of acquisition, respectively:


	December 31, 2021		December 31, 2020		April 1, 2020
Valuation techniques	Discounted cash flow, Monte Carlo
Present value discount rate(1)	18.4	%	25.8	%	23.1	%
Volatility factor	50.3	%	51.8	%	43.7	%
Expected Years	2.4 years		3.5 years		4.1 years

(1) The present value discount rate includes estimated risk premium.

- Definition

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

PROPERTY AND EQUIPMENT, NET

12 Months Ended

Dec. 31, 2021

Property, Plant and Equipment [Abstract]

PROPERTY AND EQUIPMENT, NET

PROPERTY AND EQUIPMENT, NETProperty and equipment, net consisted of the following:


	December 31,
	2021		2020
Land	$	1,645	$	1,645
Building and building improvements	4,078		2,591
Computer equipment and software	2,541		2,218
Office and other equipment	1,958		1,060
Instruments	34,094		29,916
Sample inventory	2,483		2,453
Construction in progress	4,805		4,995
	51,604		44,878
Less: accumulated depreciation	(23,089)		(17,651)
Total property and equipment, net	$	28,515	$	27,227

Depreciation expense is included in general and administrative expenses and was $6,148, $4,660 and $3,749 for the years ended December 31, 2021, 2020 and 2019, respectively.

ACCRUED COMPENSATION AND BENEFITS

12 Months Ended

Dec. 31, 2021

ACCRUED COMPENSATION AND BENEFITS

ACCRUED COMPENSATION AND BENEFITSAccrued compensation and benefits consisted of the following:


	December 31,
	2021		2020
Accrued compensation and related costs	$	2,357	$	1,896
Accrued commissions	2,994		2,644
Total accrued compensation and benefits	$	5,351	$	4,540

DEBT AND CREDIT ARRANGEMENTS

12 Months Ended

Dec. 31, 2021

Debt Disclosure [Abstract]

DEBT AND CREDIT ARRANGEMENTS

Long-term debt consisted of the following:


	December 31,
	2021		2020


Mortgage payable to affiliate	$	1,044	$	1,175
Total debt	1,044		1,175
Less: current maturities	137		131
Long-term debt, net of current maturities	$	907	$	1,044

On December 31, 2017, we entered into a Fourth Amended and Restated Loan and Security Agreement, or the Loan Agreement, with Squadron Capital LLC, or Squadron. Pursuant to the Loan Agreement, a majority of the term loan amounts under a previous agreement with Squadron were consolidated into a $20,000 term note, represented by a Term Note A, and a $15,000 revolving credit facility was established. Both facilities include interest only payments and provide for an interest rate equal to the greater of (a) three month LIBOR plus 8.61% and (b) 10%. The Loan Agreement also extended the maturity date to January 31, 2023.

In order to finance a portion of the cash consideration for the acquisition of the Vilex Companies, the Company entered into a first Amendment, or the Amendment, to the Loan Agreement (as so amended, the "First Amended Loan Agreement"), with Squadron. The First Amended Loan Agreement provided for a new $30,000 term loan facility, represented by a Term Note B, in addition to the existing $20,000 Term Note A and $15,000 revolving credit facility. Similar to the other facilities under the First Amended Loan Agreement, the Term Note B was subject to interest only payments at an interest rate equal to the greater of (a) three month LIBOR plus 8.61%, and (b) 10.00%. The Term Note B, which would have matured no later than May 31, 2020, was paid in full on December 31, 2019 using $25,000 received in exchange for the divestiture of the adult product offerings of Vilex and the related Orthex license agreement, and $5,000 from the available Squadron revolving credit facility. On January 4, 2020, the Company repaid $5,000 on the revolving credit facility with Squadron. On July 15, 2020, the Company repaid the $20,000 principal amount outstanding under the Term Note A, together with all unpaid interest and other related amounts payable.

On August 4, 2020, the Company entered into a Second Amendment (the “Second Amendment”) to its First Amended Loan Agreement with Squadron (as so further amended, the “Second Amended Loan Agreement”). Pursuant to the Second Amendment, the First Amended Loan Agreement’s revolving credit commitment was increased from the previously established $15,000 to $25,000. The Company also agreed to pay Squadron an unused commitment fee in an amount equal to the per annum rate of 0.50% (computed on the basis of a year of 360 days and the actual number of days elapsed) times the daily unused portion of the revolving credit commitment. The unused commitment fee is payable quarterly in arrears and is recorded in interest, net. The unused commitment fee paid to Squadron for the years ended December 31, 2021 and 2020 was $127 and $52, respectively.

Effective December 31, 2021, the Company entered into a Third Amendment (the "Third Amendment") to its Second Amended Loan Agreement with Squadron (as so further amended, the "Third Amended Loan Agreement"). The Third Amendment addresses the transition of the interest rate calculation from LIBOR to a SOFR (Secured Overnight Financing Rate) based rate. The previous interest rate on the facilities was at the greater of (a) three month LIBOR plus 8.61% and (b) 10.0%. Following the Third Amendment, the interest rate on the revolving credit facility is the greater of (a) six month SOFR plus 8.69% and (b) 10.0%.

Borrowings under the revolving credit facility will be made under a First Amended and Restated Revolving Note, dated August 4, 2020 (the “Amended Revolving Note”), payable, jointly and severally, by the Company and each of its subsidiaries party thereto. The Amended Revolving Note will mature at the earlier of: (i) the date on which any person or persons acquire (x) capital stock of the Company possessing the voting power to elect a majority of the Company’s Board of Directors (whether by merger, consolidation, reorganization, combination, sale or transfer), or (y) all or substantially all of the Company’s assets, determined on a consolidated basis; and (ii) January 1, 2024. There are no outstanding term loan obligations under the Third Amended Loan Agreement.

Borrowings under the Third Amended Loan Agreement are secured by substantially all of the Company's assets and are unconditionally guaranteed by each of its subsidiaries with the exception of Vilex. There are no traditional financial covenants associated with the Third Amended Loan Agreement. However, there are negative

covenants that prohibit us from, among other things, transferring any of our material assets, merging with or acquiring another entity, entering into a transaction that would result in a change of control, incurring additional indebtedness, creating any lien on our property, making investments in third parties and redeeming stock or paying dividends.

In connection with the purchase of our office and warehouse space in Warsaw, Indiana in August 2013, we entered into a mortgage note payable to Tawani Enterprises Inc., an affiliate of Squadron. Pursuant to the terms of the mortgage note, we pay Tawani Enterprises Inc. monthly principal and interest installments of $16 with interest compounded at 5% until maturity in 2028, at which time a final payment of remaining principal and interest is due. The mortgage is secured by the related real estate and building. As of December 31, 2021 and 2020, the mortgage balance was $1,044 and $1,175, respectively, of which current principal due of $137 and $131, respectively, was included in current portion of long-term debt.

At December 31, 2021, the aggregate future principal payments on our debt arrangements are as follows:


2022	$	137
2023	144
2024	152
2025	160
2026	168
Thereafter	283
	$	1,044

Interest expense relating to notes payable to Squadron and mortgage note payable with Tawani was $56, $1,233 and $4,229 for the years ended December 31, 2021, 2020 and 2019, respectively.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-URI http://asc.fasb.org/topic&trid=2208564

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (h)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1C
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495334-112611

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1I
-Subparagraph (d)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(c))
-URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (g)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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-Paragraph 1C
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-Publisher FASB
-Name Accounting Standards Codification
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-Publisher FASB
-Name Accounting Standards Codification
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Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
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-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495371-112611

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 50
-Paragraph 1B
-Subparagraph (i)
-URI http://asc.fasb.org/extlink&oid=123466505&loc=SL123495323-112611

+ Details

INCOME TAXES

12 Months Ended

Dec. 31, 2021

Income Tax Disclosure [Abstract]

INCOME TAXES

In response to the COVID-19 pandemic, the Coronavirus Aid, Relief and Economic Security Act ("CARES Act") was signed into law on March 27, 2020. The CARES Act lifts certain deduction limitations originally imposed by the Tax Act. Corporate taxpayers may carryback net operating losses originating during 2018 through 2020 for up to five years, which was not previously allowed under the Tax Act. The CARES Act also eliminates the 80% of taxable income limitation allowing corporate entities to fully utilize net operating loss carryforwards to offset taxable income in 2018, 2019 and 2020. The enactment of the CARES Act did not result in any material impact to the Company’s income tax provision.

On December 27, 2020 the Consolidated Appropriations Act, 2021 (“CAA”) was signed into law. The CAA includes the COVID-related Tax Relief Act of 2020 (“COVID TRA”). The Company is continuing to assess the effect of the CAA and does not believe it will result in a material impact to the Company’s income tax provision.

Total income tax expense (benefit) for the years ended December 31, 2021, 2020 and 2019 was allocated as follows:


	2021		2020		2019
Income from continuing operations	$	(1,128)	$	(723)	$	—
Income from discontinued operations	—		—		(660)
Total tax expense (benefit)	$	(1,128)	$	(723)	$	(660)

For the years ended December 31, 2021, 2020 and 2019 loss from continuing operations before taxes of the Company consists of the following:


	2021		2020		2019
Domestic	$	(9,232)	$	(28,756)	$	(12,010)
Foreign	(8,156)		(4,911)		(675)
Total	$	(17,388)	$	(33,667)	$	(12,685)

The components of income tax expense (benefit) from continuing operations for the years ended December 31, 2021, 2020 and 2019 are as follows:


	2021		2020		2019






Deferred:
Federal	$	—	$	—	$	1,033
State	—		—		37
Foreign	(1,128)		(723)		—


Decrease in valuation allowance	—		—		(1,070)
Total income tax expense (benefit)	$	(1,128)	$	(723)	$	—

The reconciliation between the effective tax rate and the statutory tax rate is as follows:


	December 31,
	2021		2020		2019
Federal statutory rate	21.0	%	21.0	%	21.0	%
State statutory rate, net of federal benefit	2.0	%	1.8	%	(0.7)	%
Effect of foreign rates different from statutory	(0.1)	%	0.1	%	—	%
Change in state rate	(1.3)	%	(2.5)	%	(1.3)	%
Excess tax benefits from stock plans	7.5	%	0.6	%	0.3	%
Nondeductible/nontaxable or other items	11.9	%	0.5	%	—	%
Unborn foreign tax deduction	(1.5)	%	4.0	%	—	%
Change in valuation allowance	(33.1)	%	(23.4)	%	(19.3)	%
Income tax (expense) benefit	6.3	%	2.1	%	—	%

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The primary temporary differences that give rise to the deferred tax assets and liabilities are certain inventory adjustments, depreciation and amortization, interest expense, stock based compensation and net operating loss carryforwards.

The deferred tax assets and liabilities consisted of the following at December 31, 2021 and 2020:


	2021		2020
Deferred tax assets:
Inventories, net	$	4,206	$	2,715
Stock based compensation	2,454		1,938
Loss carryforwards	35,421		29,050
Credit carryforwards	176		176
Interest carryforward	338		1,851
Accrued Settlements	—		1,467
Other	444		382
Total deferred tax assets	43,039		37,579
Valuation allowance	(38,911)		(33,160)
Net deferred tax assets	4,128		4,419
Deferred tax liabilities:
Intangibles	(7,518)		(9,120)
Property, plant and equipment	(1,238)		(1,054)
Total deferred tax liabilities	(8,756)		(10,174)
Foreign currency translation impact	(143)		—
Deferred tax assets (liabilities), net	$	(4,771)	$	(5,755)

The deferred tax assets were fully offset by a valuation allowance at December 31, 2021 and 2020, with the exception of certain deferred tax liabilities recognized in a foreign jurisdiction as a result of fair value adjustments recorded upon the acquisition of ApiFix. The Company has recorded a tax benefit during the years ended December 31, 2021 and 2020, for losses generated in Israel. As of December 31, 2021, we had available federal, state and foreign tax loss carryforwards of $114,008, $73,997 and $22,671, respectively. We had available federal tax credits of $176. Net operating losses generated prior to December 31, 2017 will begin to expire in 2028. Federal net operating losses generated after January 1, 2018 will have an indefinite carryforward period. An ownership change under Section 382 of the Internal Revenue Code was deemed to occur on May 30, 2014. Given the limitation calculation, we anticipate approximately $23,920 in losses generated prior to the ownership

change date will be subject to potential limitation. The estimated annual limitation is $1,062. A second ownership change under Section 382 was deemed to occur on December 11, 2018. The estimated annual limitation is $9,736, which is increased by $22,430 over the first five years as a result of an unrealized built in gain. NOLs sustained prior to May 30, 2014 will still be constricted by the lower limitation.

Management assesses the available positive and negative evidence to estimate whether sufficient future taxable income will be generated to permit use of the existing deferred tax assets. A significant piece of objective negative evidence evaluated was the cumulative loss incurred over the three-year period ended December 31, 2021. Such objective evidence limits the ability to consider other subjective evidence, such as our projections for future growth. As a result, a full valuation continues to be recorded against the Company's net deferred tax assets, with the exception of Israel.

We are subject to taxation in the United States, Indiana and various other state and international jurisdictions. As of December 31, 2021, all tax years from 2008 remain open to examination by the major taxing jurisdictions to which we are subject due to our net operating loss and credit carryforwards from those years. We believe that the income tax filing positions will be sustained on audit and do not anticipate any adjustments that will result in a material change. Therefore, no reserve for uncertain income tax positions has been recorded. Interest and penalties, if any, associated with income tax examinations will be to record such items as a component of income taxes.

At December 31, 2021, our foreign operations held cash totaling $2,444. We have not provided for foreign withholding tax on the undistributed earnings from our non-U.S. subsidiaries that are considered to be indefinitely reinvested. If such earnings were to be distributed, any foreign withholding tax would not be significant.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 21
-URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32857-109319

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
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-Topic 740
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-Subparagraph (SAB TOPIC 6.I.5.Q1)
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-Publisher FASB
-Name Accounting Standards Codification
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-URI http://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 30
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-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
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-URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

+ Details

STOCKHOLDERS' EQUITY

12 Months Ended

Dec. 31, 2021

Share-based Payment Arrangement [Abstract]

STOCKHOLDERS' EQUITY

STOCKHOLDERS’ EQUITY

Stock Options

The fair value for options granted at the time of issuance were estimated at the date of grant using a Black-Scholes options pricing model. Significant assumptions included in the option value model include the fair value of our common stock at the grant date, weighted average volatility, risk-free interest rate, dividend yield and the forfeiture rate. There were no stock options granted in any of the periods presented.

Our stock option activity and related information are summarized as follows:


	Options	Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Terms (in Years)
Outstanding at January 1, 2019	112,094	$	30.32	1.8
Forfeited or expired	(2,546)	$	27.61
Exercised	(38,920)	$	29.30
Outstanding at December 31, 2019	70,628	$	30.97	1.2
Forfeited or expired	(4,556)	$	30.97
Exercised	(53,270)	$	30.97
Outstanding at December 31, 2020	12,802	$	30.97	1.6
Forfeited or expired	(1,742)	$	30.97
Exercised	(4,422)	$	30.97
Outstanding at December 31, 2021	6,638	$	30.97	1.3

Options generally include a time-based vesting schedule permitting the options to vest ratably over three years. At December 31, 2021 and 2020, all options were fully vested.

There was no stock-based compensation expense on stock options for all periods presented.

Restricted Stock

Our restricted stock activity and related information are summarized as follows:


	Restricted Stock	Weighted-Average Remaining Contractual Terms (in Years)
Outstanding at January 1, 2019	177,293	2.2
Granted	154,769
Forfeited	(9,616)
Outstanding at Vested	(4,444)
Outstanding at December 31, 2019	318,002	1.7
Granted	164,010
Forfeited	(1,885)
Outstanding at Vested	(43,397)
Outstanding at December 31, 2020	436,730	1.1
Granted	114,256
Forfeited	(6,354)
Vested	(176,186)
Outstanding at December 31, 2021	368,446	1.1
Restricted stock exercisable at December 31, 2021	—

At December 31, 2021, there was $7,075 of unrecognized compensation expense remaining related to our service-based restricted stock awards. The unrecognized compensation cost is expected to be recognized over a weighted average period of 1.1 years.

Stock-based compensation expense on restricted stock amounted to $5,842, $6,196 and $2,603 for the years ended December 31, 2021, 2020 and 2019, respectively. The decrease in the stock compensation expense for the twelve months ended December 31, 2021 was primarily driven by the lack of one-time stock grants related to executive management transitions that vested immediately resulting in an additional $1,542 of expense which did not repeat in 2021.

Warrants

Our warrant activity and related information are summarized below:


	Warrants	Weighted-Average Exercise Price
Outstanding at January 1, 2019	6,790	$	27.81
Forfeited or expired	(6,386)	$	27.61
Outstanding at December 31, 2019	404	$	30.97
Forfeited or expired	(404)	$	30.97
Outstanding at December 31, 2020	—	$	—
Forfeited or expired	—	$	—
Outstanding at December 31, 2021	—	$	—

For all periods presented, the warrants were issued at exercise prices ranging from $27.61 to $30.97 per share. The warrants generally have a 10-year term. No warrants have been exercised during each of the three years in the period ended December 31, 2021. At inception and as of December 31, 2021, 2020 and 2019, no fair value was assigned to the warrants.

NET LOSS PER SHARE

12 Months Ended

Dec. 31, 2021

Earnings Per Share [Abstract]

NET LOSS PER SHARE

The following is a reconciliation of basic and diluted net loss per share attributable to common stockholders:


	Year Ended December 31,
	2021		2020		2019
Net loss from continuing operations	$	(16,260)	$	(32,944)	$	(12,685)
Net loss from discontinued operations	—		—		(1,046)
Net loss attributable to common stockholders - basic and diluted	$	(16,260)	$	(32,944)	$	(13,731)
Weighted average number of shares - basic and diluted	19,268,255		18,056,828		14,624,194
Net loss from continuing operations per share - basic and diluted	$	(0.84)	$	(1.82)	$	(0.87)
Net loss from discontinued operations per share - basic and diluted	—		—		(0.07)
Net loss per share - basic and diluted	$	(0.84)	$	(1.82)	$	(0.94)

Our basic and diluted net loss per share is computed using the two-class method. The two-class method is an earnings allocation that determines net income per share for each class of common stock and participating securities according to their participation rights in dividends and undistributed earnings or losses. Non-vested restricted stock that includes non-forfeitable rights to dividends are considered participating securities.

Because we have incurred a net loss for all periods presented, diluted net loss per common share is the same as basic net loss per common share. The following contingently issuable and convertible equity shares were excluded from the calculation of diluted net loss per share because their effect would have been anti-dilutive for all periods presented:


	Year Ended December 31,
	2021	2020	2019


Restricted stock	368,446	436,730	318,002
Stock options	6,638	12,802	70,628
Warrants	—	—	404
	375,084	449,532	389,034

BUSINESS SEGMENT

12 Months Ended

Dec. 31, 2021

Segment Reporting [Abstract]

BUSINESS SEGMENT

Operating segments are defined as components of an enterprise for which separate financial information is available that is evaluated regularly by the chief operating decision maker, or decision making group, in deciding how to allocate resources and in assessing performance. We have one operating and reportable segment, OrthoPediatrics, which designs, develops and markets anatomically appropriate implants and devices for children with orthopedic problems. Our chief operating decision-maker, our Chief Executive Officer, reviews financial information presented on a consolidated basis for purposes of making operating decisions and assessing financial performance, accompanied by disaggregated revenue information by product category. We do not assess the performance of our individual product categories on measures of profit or loss, or other asset-based metrics. Therefore, the information below is presented only for revenue by category and geography.

Product sales attributed to a country or region includes product sales to hospitals, physicians and distributors and is based on the final destination where the products are sold. No individual customer accounted for more than 10% of total product sales for any of the periods presented. No customer accounted for more than 10% of consolidated accounts receivable as of December 31, 2021 or 2020.

Disaggregated revenue - product sales by source were as follows:


	Year Ended December 31,
Product sales by geographic location:	2021		2020		2019
U.S.	$	77,781	$	62,966	$	55,055
International	20,268		8,112		17,497
Total	$	98,049	$	71,078	$	72,552


	Year Ended December 31,
Product sales by category:	2021		2020		2019
Trauma and deformity	$	65,829	$	47,677	$	49,371
Scoliosis	28,046		20,738		21,485
Sports medicine/other	4,174		2,663		1,696
Total	$	98,049	$	71,078	$	72,552

No individual country with sales originating outside of the United States accounted for more than 10% of consolidated revenue for the years ended December 31, 2021, 2020 and 2019.

- Definition

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.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
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+ Details

RELATED PARTY TRANSACTIONS	12 Months Ended
RELATED PARTY TRANSACTIONS	Dec. 31, 2021
Related Party Transactions [Abstract]
RELATED PARTY TRANSACTIONS	RELATED PARTY TRANSACTIONSIn addition to the debt and credit agreements and mortgage with Squadron and its affiliate (refer to Note 6), we currently use Structure Medical, LLC (“Structure Medical”) as one of our suppliers. Structure Medical is affiliated with Squadron and a supplier with which we maintain certain long-term agreements. Our aggregate payments to Structure Medical for inventory purchases were $750, $2,622 and $3,933 for the years ended December 31, 2021, 2020 and 2019, respectively. On December 31, 2019, the Company divested Vilex for $25,000 to an affiliate of Squadron. In conjunction with the divestiture, the Company also entered into an exclusive perpetual license agreement to permit the purchasers of Vilex the ability to access intellectual property and sell products using the external fixation technology of Orthex, LLC to non-pediatric accounts. For the year ended December 31, 2021, sales and payments related to inventory purchases to Squadron's affiliate, now known as Vilex, LLC, were $224 and $702, respectively. For the year ended December 31, 2020 sales and payments related to inventory purchases were $595 and $2,900, respectively.

EMPLOYEE BENEFIT PLAN	12 Months Ended
EMPLOYEE BENEFIT PLAN	Dec. 31, 2021
Retirement Benefits [Abstract]
EMPLOYEE BENEFIT PLAN	EMPLOYEE BENEFIT PLANWe have a defined-contribution plan, OrthoPediatrics 401(k) Retirement Plan (the “401(k) Plan”), which includes a cash or deferral (Section 401(k)) arrangement. The 401(k) Plan covers those employees who meet certain eligibility requirements and elect to participate. Employee contributions are limited to the annual amounts permitted under the Internal Revenue Code. The 401(k) Plan allows us to make a discretionary matching contribution. Discretionary matching contributions are determined annually by management. Effective January 1, 2019, we elected to match our employees' 401(k) contributions up to 3% of employees' salary. This was increased to 4% effective January 1, 2020. For the years ended December 31, 2021 and 2020, we matched $510 and $439, respectively of our employees' 401(k) contributions.

- Definition

The entire disclosure for retirement benefits.

+ References

Reference 1: http://www.xbrl.org/2003/role/exampleRef
-Publisher FASB
-Name Accounting Standards Codification
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+ Details

COMMITMENTS AND CONTINGENCIES	12 Months Ended
COMMITMENTS AND CONTINGENCIES	Dec. 31, 2021
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	COMMITMENTS AND CONTINGENCIES Leases As of December 31, 2021, the Company has recorded a lease liability of $293 and corresponding right-of-use asset of $297 on its consolidated balance sheet. Legal Proceedings From time to time, we are involved in various legal proceedings arising in the ordinary course of our business. K2M - Alleged Patent Infringement On January 20, 2017, K2M, Inc. filed suit against us in the United States District Court for the District of Delaware (K2M, Inc. v. OrthoPediatrics Corp. et al., Case No. 1:17-cv-0061) seeking unspecified damages for alleged infringement of U.S. Patent No. 9,532,816. The complaint was amended on August 21, 2017 to add, among other things, a claim of patent infringement regarding U.S. Patent No. 9,655,664. These patents relate to certain instruments used in our RESPONSE™ spine systems, which represent a portion of our total scoliosis portfolio. We denied these claims and responded with counterclaims seeking declaratory relief that the patents in question are both invalid and not infringed. On November 19, 2019, K2M amended its complaint to add two (2) additional issued patents, to add claims of patent infringement regarding U.S. Patent Nos. 10,285,735 and 10,292,736 (both issued in May 2019). Like before, these newly issued K2M patents relate to certain instruments used in our RESPONSE spine systems, and we denied these claims and responded with counterclaims seeking declaratory relief that the patents in question are both invalid and not infringed. On June 29, 2021, the parties settled the matter, and subsequently filed a Joint Stipulation of Dismissal With Prejudice concerning all claims and counterclaims, which the Court subsequently granted and ordered. The Company previously accrued for the related expense during the fourth quarter of 2020. No material modifications were made to the accrual during 2021, and the payment made during the second quarter 2021 satisfied all liabilities associated with this matter. IMED Surgical - Software Ownership Dispute On October 16, 2020, the Company, its wholly-owned subsidiary, Orthex, LLC (“Orthex”), the Company’s largest investor, Squadron Capital, LLC (“Squadron”), and certain other defendants, were named in a lawsuit filed by IMED Surgical, LLC, a New Jersey company (the “Plaintiff”), in Broward County, Florida Circuit Court. In the lawsuit, the Plaintiff claims, among other things, that it is the rightful owner of certain patented point-and-click planning software being used by the Company, Orthex and Squadron (specifically, U.S. Patent No. 10,258,377 (titled “Point and click alignment method for orthopedic surgeons, and surgical and clinical accessories and devices,” issued on April 16, 2019) (hereinafter, the “’377 Patent”). In June 2019, the Company purchased all the issued and outstanding units of membership interests in Orthex, and all the issued and outstanding shares of stock of Vilex in Tennessee, Inc. (“Vilex”) for $60,000 in total consideration. Vilex and Orthex are primarily manufacturers of foot and ankle surgical implants, including cannulated screws, fusion devices, surgical staples and bone plates, as well as the Orthex Hexapod technology, a system of rings, struts, implants, hardware accessories, and the Point & Click Software used to treat congenital deformities and limb length discrepancies. On December 31, 2019, the Company divested substantially all of the assets relating to Vilex's adult product offerings to a wholly-owned subsidiary of Squadron, in exchange for a $25,000 reduction in a term note owed to Squadron in connection with the initial acquisition. As part of the sale, the Company also executed an exclusive license arrangement with Squadron providing for perpetual access to certain intellectual property, including the ‘377 Patent. According to the lawsuit, the other defendants, who are unrelated to the Company, assigned the ‘377 Patent to Orthex in violation of certain agreements with the Plaintiff. The Plaintiff, among other things, requests that the defendants be ordered to convey and assign to Plaintiff all of their rights, title and interests in and to the ’377 Patent and seeks certain compensatory, consequential and unjust enrichment damages from Orthex and the unrelated defendants. On May 13, 2021, the Court ordered the lawsuit stayed pending arbitration. To the extent the Plaintiff desires to further pursue the matter, it must first do so through a separate arbitration proceeding. In mid-November 2021, the Plaintiff initiated an arbitration proceeding. In connection with the stay order, the Court also ordered the Company, Orthex and Squadron to give notice to the Plaintiff before any attempt to dispose, assign, sell or otherwise encumber the ‘377 Patent. The Company, Orthex and Squadron filed an appeal of this component of the order, but the appellate court affirmed the lower court’s decision. The Company, Orthex and Squadron have not sought to further pursue an appeal of the subject order. Although we believe the IMED lawsuit is without merit and will vigorously defend the claims asserted against us, arbitration and litigation can involve complex factual and legal questions, and an adverse resolution of such proceedings could have a material adverse effect on our business, operating results and financial condition. Barry - Alleged Patent Infringement On December 30, 2020, Dr. Mark Barry filed suit against us in the United States District Court for the District of Delaware (Barry v. OrthoPediatrics Corp. et al., Case No. 1:20-cv-01786) seeking unspecified damages for alleged infringement of U.S. Patent Nos. 7,670,358; 8,361,121; 9,339,301; 9,668,787; and 9,668,788, which relate to systems and methods concerning derotation of spinal bodies to correct spinal deformities. On March 19, 2021, the parties reached a final settlement, which included the Company entering into a license agreement with Dr. Barry. The license agreement was recorded by the Company in the amount of $2,858, which will be amortized over a period of up to 8 years based upon the number of cases utilizing the related spinal deformity system in a given period. The balance of the amount otherwise paid to Dr. Barry had been previously accrued for during the fourth quarter of 2020 in anticipation of this final settlement. Wishbone Medical, Inc. – Patent Infringement Litigation On October 30, 2020, OrthoPediatrics, along with its wholly-owned subsidiary, Orthex, LLC, filed a lawsuit in federal district court (N.D. Indiana, South Bend Division, Case No. 3:20-cv-00929) against Wishbone Medical, Inc. and Nick A. Deeter (collectively “Wishbone”), claiming infringement of ’377 Patent, unfair competition, false advertising, breach of contract, defamation per se, tortious interference with contractual relationships, and tortious interference with prospective contractual relationships. In early January 2021, OrthoPediatrics amended its lawsuit by adding a declaratory judgment claim of infringement of the ‘377 Patent against Wishbone. Thereafter, in January 2021, Wishbone filed a motion to dismiss all OrthoPediatrics’ causes of action. In late August 2021, the Court denied Wishbone's motion to dismiss with respect to OrthoPediatrics’ infringement and breach of contract claims and dismissed OrthoPediatrics' remaining causes of action. In late September 2021, Wishbone filed its answer and counterclaims, in part, seeking declaratory judgment of non-infringement and invalidity of the ‘377 Patent, and alleging OrthoPediatrics patent infringement claim(s) against Wishbone was made in bad faith. In mid-October 2021, OrthoPediatrics filed its answer to Wishbone’s counterclaims, denying all of them. Although we believe Wishbone’s counterclaims are without merit and will vigorously defend the claims asserted against us, litigation can involve complex factual and legal questions, and an adverse resolution of this proceeding could have an adverse effect on our business, operating results and financial condition. We are not presently a party to any other legal proceedings the outcome of which, if determined adversely to us, would individually or in the aggregate materially affect our financial position or results of operations or cash flows. Purchase Obligations and Performance Requirements As a result of entering into a license agreement for the exclusive distribution of the 7D Surgical FLASHTM Navigation platform during 2021, the Company has agreed to a minimum purchase commitment for the first twelve months of that agreement. As of December 31, 2021, the remaining purchase commitment under the agreement was $1.9 million. On July 20, 2021, we entered into an amended license agreement, resulting in a five-year extension of our exclusive distribution rights of the FIREFLY Technology. As a component of the agreement the Company is required to meet minimum performance metrics, measured by the number of spine procedures in the fiscal year which used the FIREFLY products against the annual requirement in the agreement. This includes any scheduled surgeries whereby the Company has committed to payment of the product. The number of required surgeries varies each year of the agreement. During the year ended December 31, 2021, the Company did not reach the minimum performance metrics. As such, the Company recorded $0.5 million as a component of cost of revenue for the shortfall which occurred during the year. no expense was recorded for the years ended December 31, 2020 or 2019. Royalties As of December 31, 2021, we are contracted to pay royalties to individuals and entities that provide research and development services, which range from 0.5% to 20% of sales. Additionally, we have minimum royalty commitments of $10 annually through 2026. We have products in development that have milestone payments and royalty commitments. In any development project, there are significant variables that will affect the amount and timing of these payments and as of December 31, 2021, we have not been able to determine the amount and timing of payments. We do not anticipate these future payments will have a material impact on our financial results.

QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

12 Months Ended

Dec. 31, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

The quarterly financial data presented should be read in conjunction with the consolidated financial statements and related notes.


	Three Months Ended
	Mar. 31, 2021		Jun. 30, 2021		Sep. 30, 2021		Dec. 31, 2021
Net revenue	$	21,462	$	26,695	$	25,079	$	24,813
Gross profit	16,325		20,443		18,554		18,081
Operating loss	(5,973)		(2,846)		(3,644)		(5,561)
Loss before income tax benefit	(10,691)		(4,042)		(2,489)		(166)
Provision for income taxes (benefit)	(312)		(286)		(292)		(238)

Net loss	(10,379)		(3,756)		(2,197)		72

Net loss per share - basic and diluted	$	(0.54)	$	(0.19)	$	(0.11)	$	—
	Three Months Ended
	Mar. 31, 2020		Jun. 30, 2020		Sep. 30, 2020		Dec. 31, 2020
Net revenue	$	16,356	$	13,593	$	22,205	$	18,924
Gross profit	12,213		10,061		17,639		15,118
Operating loss	(4,497)		(7,017)		(2,498)		(12,743)
Loss before income tax benefit	(4,945)		(9,447)		(4,539)		(14,736)
Provision for income taxes (benefit)	—		—		—		(723)

Net loss	(4,945)		(9,447)		(4,539)		(14,013)


Net loss per share - basic and diluted	$	(0.30)	$	(0.54)	$	(0.24)	$	(0.73)

During the fourth quarter ended December 31, 2020, the Company recorded a $2,730 revenue reduction due to the repurchase of inventory from a stocking distributor in Germany, Austria and Switzerland that we converted to a sales agency. The aforementioned $2,730 reduction of revenue reduced gross profit in the fourth quarter and total year by $1,115.

SIGNIFICANT ACCOUNTING POLICIES (Policies)

12 Months Ended

Dec. 31, 2021

New Accounting Pronouncements or Change in Accounting Principle

Basis of Presentation

Use of Estimates

Use of EstimatesPreparation of our consolidated financial statements requires the use of estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, as of the date of the consolidated financial statements. By their nature, these judgments are subject to an inherent degree of uncertainty. We use historical experience and other assumptions as the basis for our judgments and estimates. Because future events and their effects cannot be determined with precision, actual results could differ significantly from these estimates. Any changes in these estimates will be reflected in our consolidated financial statements.

Foreign Currency Transactions

We currently bill our international stocking distributors in U.S. dollars, resulting in minimal foreign exchange transaction expense.

Fair Value of Financial Instruments

Level 1 – Quoted prices in active markets for identical assets or liabilities;

Level 2 – Observable market-based inputs or unobservable inputs that are corroborated by market data; and

balance sheet date.

Revenue from Contracts with Customers

Revenue Recognition – United States

Revenue Recognition – International

Beginning in early 2017and continuing through 2021, we expanded operations and established legal entities outside the United States, permitting us to sell under an agency model direct to local hospitals internationally. In the year ended December 31, 2020, the Company recorded a $2,730 revenue reduction due to the repurchase of inventory from a stocking distributor in Germany, Austria and Switzerland that we converted to a sales agency. The products are generally consigned to our independent sales agencies, and revenue is recognized when the products are used by or shipped to the hospital for surgeries on a case by case basis. On rare occasions, hospitals purchase products for their own inventory, and revenue is recognized when title passes upon shipment. Pricing for each customer is dictated by a unique pricing agreement.

Cash, Cash Equivalents and Short-Term Investments

Cash, Cash Equivalents and Short Term Investments

Restricted CashIn conjunction with the sale of Vilex, $1,250 was placed into a separate escrow account. This cash is reported as restricted cash on the December 31, 2021 and 2020 Consolidated Balance Sheets. These funds were to remain restricted until August 31, 2021 at which time, they were to be released to the Company subject to no claims related to the purchase; however, due to the pending IMED Surgical litigation, the cash remains reported as restricted until the conclusion of the legal matter. See Note 16 - Commitments and Contingencies for further detail. The Company also maintains restricted cash of 100 Euro at its Netherlands entity for potential Italian tenders.

Accounts Receivable and Allowance for Doubtful Accounts

Inventories, net

In addition, we continue to introduce new products, which may require us to take additional charges for excess and obsolete inventory in the future.

Property and Equipment, net

Sample inventory consists of our implants and instruments, and is maintained to market and promote our products. Sample inventory is carried at cost less accumulated depreciation.

Depreciable lives are generally as follows:


Building and building improvements			25 to 30 years
Furniture and fixtures			5 to 7 years
Computer equipment			3 to 5 years
Business software			3 years
Office and other equipment			5 to 7 years
Instruments			5 years
Sample inventory			2 years

Amortizable Intangible Assets, net

Goodwill and Other Intangible Assets

Acquisition Payable and Contingent Consideration

Acquisition Payable and Contingent ConsiderationUpon the completion of an acquisition the Company may record an acquisition installment payable, contingent consideration or both. Both are recorded at their fair values as determined by management with the assistance of an independent valuation specialist at the original issuance date and are adjusted on a recurring basis. Accretion of interest expense attributable to the acquisition installment payable are recorded as a component of interest expense, net. Changes in the fair value of the contingent consideration are included in fair value adjustments of contingent consideration.

Cost of Revenue

Cost of RevenueCost of revenue consists primarily of products purchased from third-party suppliers, excess and obsolete inventory adjustments, inbound freight, and royalties. Our implants and instruments are manufactured to our specifications by third-party suppliers who meet our manufacturer qualifications standards. Our third-party manufacturers are required to meet Food and Drug Administration (the “FDA”), International Organization for Standardization and other country-specific quality standards. The majority of our implants and instruments are produced in the United States.

Sales and Marketing Expenses

Sales and Marketing ExpensesSales and marketing expenses primarily consist of commissions to our domestic and select international independent sales agencies and consignment distributors, as well as compensation, commissions, benefits and other related costs for personnel we employ. Commissions and bonuses are generally based on a percentage of sales. Our international independent stocking distributors purchase instrument sets and replenishment stock for resale, and we do not pay commissions or any other sales related costs for international sales to distributors.

Advertising Costs

Advertising Costs Advertising costs consist primarily of print advertising, trade shows, and other related expenses. Advertising costs are expensed as incurred and are recorded as a component of sales and marketing expense.

Research and Development Costs

Research and Development CostsResearch and development costs are expensed as incurred. Our research and development expenses primarily consist of costs associated with engineering, product development, consulting services, outside prototyping services, outside research activities, materials, development and protection of our intellectual property portfolio, as well as other costs associated with development of our products. Research and development costs also include related personnel and consultants’ compensation expense.

Stock-Based Compensation

Comprehensive Income (Loss)

Comprehensive Income (Loss)Comprehensive income (loss) is defined as the change in equity during a period from transactions and other events and circumstances from non-owner sources. Comprehensive income (loss) includes foreign currency translation adjustments and unrealized gains (losses) on marketable securities.

Income Taxes

Litigation and Contingencies

Accruals for litigation and contingencies are reflected in the consolidated financial statements based on

Leases

Emerging Growth Company Reporting Requirements

“Emerging Growth Company” Reporting Requirements

assessment of the internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act of 2002. Our status as an emerging growth company will remain until December 31, 2022. As such, our external auditors for the fiscal year ending December 31, 2022 will be required to provide an attestation on the status of our internal controls under Section 404(b) of the Sarbanes-Oxley Act.Section 107 of the JOBS Act also provides that an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have irrevocably elected not to avail ourselves of this exemption from new or revised accounting standards and, therefore, we will be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies.

Recent Accounting Pronouncements

Shipping and handling costs

New Accounting Pronouncements or Change in Accounting Principle

Revenue from Contracts with Customers

Shipping and Handling Costs

SIGNIFICANT ACCOUNTING POLICIES (Tables)

12 Months Ended

Dec. 31, 2021

Accounting Policies [Abstract]

Summary of Activity in Allowance for Doubtful Accounts

The following table summarizes activity in the allowance for doubtful accounts:


	December 31,
	2021		2020		2019
Balance at beginning of year	$	433	$	506	$	134
Adjustments charged to expense (income)	(5)		274		424
Write-offs	81		347		52
Balance at end of year	$	347	$	433	$	506

Property and Equipment, Depreciable Lives

Depreciable lives are generally as follows:


Building and building improvements			25 to 30 years
Furniture and fixtures			5 to 7 years
Computer equipment			3 to 5 years
Business software			3 years
Office and other equipment			5 to 7 years
Instruments			5 years
Sample inventory			2 years

Property and equipment, net consisted of the following:


	December 31,
	2021		2020
Land	$	1,645	$	1,645
Building and building improvements	4,078		2,591
Computer equipment and software	2,541		2,218
Office and other equipment	1,958		1,060
Instruments	34,094		29,916
Sample inventory	2,483		2,453
Construction in progress	4,805		4,995
	51,604		44,878
Less: accumulated depreciation	(23,089)		(17,651)
Total property and equipment, net	$	28,515	$	27,227

BUSINESS COMBINATIONS (Tables)

12 Months Ended

Dec. 31, 2021

Business Combination and Asset Acquisition [Abstract]

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed


Description	Amount
Fair value of total acquisition consideration	$	87,379
Assets
Cash	344
Accounts receivable-trade	245
Inventories	685
Prepaid expenses and other current assets	77
Property and equipment	153
Amortizable intangible assets	32,150
Other intangible assets	8,640
Operating lease right-of-use asset	104
Total assets	42,398
Liabilities
Accounts payable and accrued liabilities	226
Operating lease liabilities	106
Other current liabilities	270
Deferred income taxes	6,487

Total liabilities	7,089
Less: total net assets	35,309
Goodwill	$	52,070


Description	Amount
Fair value of total acquisition consideration	$	3,318
Assets
Cash	81
Accounts receivable-trade	215

Prepaid expenses and other current assets	38
Property and equipment	10
Amortizable intangible assets	950
Other intangible assets	$	210
Total assets	1,504
Liabilities
Accounts payable and accrued liabilities	60



Total liabilities	60
Less: total net assets	1,444
Goodwill	$	1,874


Description	Amount
Fair value of total acquisition consideration	$	60,184
Assets
Cash	348
Accounts receivable-trade	2,088
Inventories	3,652
Prepaid expenses and other current assets	12
Property and equipment	7,540
Amortizable intangible assets	31,180

Operating lease right-of-use asset	323
Total assets	45,143
Liabilities
Accounts payable and accrued liabilities	563
Operating lease liabilities	323
Deferred tax liability	1,175
Other long-term liabilities	68
Total liabilities	2,129
Less: total net assets	43,014
Goodwill	$	17,170

Schedule of Total Consideration Transferred After Discounting Future Payments


	Consideration		Present Value
Cash consideration	$	2,000	$	2,000
Payment of ApiFix transaction related costs	67		67
Issuance of common stock	35,176		35,176
Anniversary Payments	30,000		22,620
System sales payment	41,741		27,190
Total consideration transferred	$	108,984	$	87,053

Schedule of Indefinite-lived Intangible Assets Acquired as Part of Business Combination


	Amount		Remaining Economic Useful Life
Trademarks / Names	$	8,640	Indefinite
Patents	31,720		15 years
Customer Relationships	230		10 years
Non-competition Agreements	200		4 years
	$	40,790


	Amount		Remaining Economic Useful Life
Trademarks / Names	$	210	Indefinite
Customer Relationships	910		10 years
Non-competition Agreements	40		5 years
	$	1,160


	Amount		Remaining Economic Useful Life
Trademarks / Names	$	4,610	Indefinite
Patents	22,390		15 years
Internally Developed Software	1,550		10 years
Customer Relationships	2,570		12 years
Non-competition Agreements	60		5 years
	$	31,180

Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination


	Amount		Remaining Economic Useful Life
Trademarks / Names	$	8,640	Indefinite
Patents	31,720		15 years
Customer Relationships	230		10 years
Non-competition Agreements	200		4 years
	$	40,790


	Amount		Remaining Economic Useful Life
Trademarks / Names	$	210	Indefinite
Customer Relationships	910		10 years
Non-competition Agreements	40		5 years
	$	1,160


	Amount		Remaining Economic Useful Life
Trademarks / Names	$	4,610	Indefinite
Patents	22,390		15 years
Internally Developed Software	1,550		10 years
Customer Relationships	2,570		12 years
Non-competition Agreements	60		5 years
	$	31,180

Schedule of Business Acquisitions by Acquisition, Contingent Consideration

Presented below is a summary of the present value of the anniversary payments and fair value of the system sales payment related to the ApiFix acquisition:


	December 31, 2021		December 31, 2020		April 1, 2020
Anniversary Payments:
Second Year Payment	$	12,862	$	12,233	$	10,980
Third Year Payment	7,075		6,335		5,780
Fourth Year Payment	7,234		6,449		5,860
Total acquisition installment payable	27,171		25,017		22,620
Less: current portion of acquisition installment payable	12,862		12,233		10,980
Acquisition installment payable, net of current portion	14,309		12,784		11,640
System sales payment	28,910		30,710		27,190
ApiFix future consideration, net of current portion	$	43,219	$	43,494	$	38,830

DISCONTINUED OPERATIONS (Tables)

12 Months Ended

Dec. 31, 2021

Discontinued Operations and Disposal Groups [Abstract]

Disposal Groups, Including Discontinued Operations

Assets and liabilities divested consisted of the following as of December 31, 2019:


Description	Amount
Cash	$	515
Accounts Receivable - trade, less allowance for doubtful accounts	928
Inventories, net	2,060
Prepaid expenses and other current assets	24
Property and equipment, net	6,246
Amortizable intangible assets	13,390
Goodwill	3,397
Other intangible assets	380
Operating lease right-of-use asset	216
Total assets divested	$	27,156

Accounts payable - trade	$	37
Accrued compensation and benefits	171
Operating lease liabilities	199
Deferred tax liability	1,175
Other current liabilities	13
Total liabilities divested	$	1,595
Net assets sold	$	25,561
Allocated purchase price	25,000
Loss on divestiture	$	(561)


Major classes of line items constituting loss of discontinued operations	2019
Net revenue	$	3,069
Cost of revenue	(286)
Sales and marketing	(692)
General and administrative	(2,103)
Other income (expense), net	(9)
Pretax net loss of discontinued operations	$	(21)
Income tax expense	(464)
Net loss on discontinued operations	$	(485)

- Definition

Tabular disclosure of information related to a disposal group. Includes, but is not limited to, a discontinued operation, disposal classified as held-for-sale or disposed of by means other than sale or disposal of an individually significant component.

+ References

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Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef
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Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef
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+ Details

GOODWILL AND INTANGIBLE ASSETS (Tables)

12 Months Ended

Dec. 31, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Goodwill

Changes in the carrying amount of goodwill were as follows:


	Total
Goodwill at January 1, 2020	$	13,773
Telos acquisition	1,874
Orthex measurement period adjustment	(688)
ApiFix acquisition	52,070
Foreign currency translation impact	3,482
Goodwill at January 1, 2021	$	70,511



Foreign currency translation impact	1,838
Goodwill at December 31, 2021	$	72,349

Schedule of the Balances of Amortizable Intangible Assets

As of December 31, 2021, the balances of amortizable intangible assets were as follows:


	Weighted-Average Amortization Period	Gross Intangible Assets		Accumulated Amortization		Net Intangible Assets
Patents	13.7 years	$	44,493	$	(5,664)	$	38,829
Intellectual Property	10.1 years	9,847		(1,408)		8,439
License agreements	5.5 years	10,674		(2,448)		8,226
Total amortizable assets		$	65,014	$	(9,520)	$	55,494

As of December 31, 2020, the balances of amortizable intangible assets were as follows:


	Weighted-Average Amortization Period	Gross Intangible Assets		Accumulated Amortization		Net Intangible Assets
Patents	14.7 years	$	43,363	$	(2,650)	$	40,713
Intellectual Property	10.3 years	8,990		(744)		8,246
License agreements	2.7 years	2,765		(1,440)		1,325
Total amortizable assets		$	55,118	$	(4,834)	50,284

Schedule of Amortization Expense of Amortizable Intangible Assets

Future amortization expenses are expected as follows:


Year Ending December 31:
2022	$	5,216
2023	5,245
2024	5,144
2025	4,954
2026	4,936
Thereafter	29,999
	$	55,494

FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables)

12 Months Ended

Dec. 31, 2021

Fair Value Disclosures [Abstract]

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

The following table summarize the assets and liabilities measured at fair value on a recurring basis as of December 31, 2021 and 2020, respectively.


	December 31, 2021
	Level 1		Level 2		Level 3		Total
Financial Assets

Short term investments

Corporate Bonds	$	22,476	$	—	$	—	$	22,476
Treasury Bonds	$	14,317	$	—	$	—	$	14,317
Asset Backed Securities	$	—	$	8,272	$	—	$	8,272
Other	$	837	$	—	$	—	$	837
Financial Liabilities
Contingent Consideration	$	—	$	—	$	28,910	$	28,910
	December 31, 2020
	Level 1		Level 2		Level 3		Total
Financial Assets
Cash Equivalents	$	15,002	$	—	$	—	$	15,002
Short term investments
Exchange Trade Mutual Funds	$	35,208	$	—	$	—	$	35,208
Corporate Bonds	$	9,616	$	—	$	—	$	9,616
Treasury Bonds	$	6,520	$	—	$	—	$	6,520
Other	$	3,797	$	—	$	—	$	3,797
Financial Liabilities			$	—	$	—
Contingent Consideration	$	—	$	—	$	30,710	$	30,710

Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation

The following table summarizes the change in fair value of the Level 3 instrument:


	Total
Balance at January 1, 2020	$	—
Contingent consideration recorded as a result of the acquisition (Note 3)	27,190
Increase in fair value of contingent consideration	3,520
Balance at December 31, 2020	$	30,710
Decrease in fair value of contingent consideration	(1,800)
Balance at December 31, 2021	$	28,910

Fair Value Measurement Inputs and Valuation Techniques


	December 31, 2021		December 31, 2020		April 1, 2020
Valuation techniques	Discounted cash flow, Monte Carlo
Present value discount rate(1)	18.4	%	25.8	%	23.1	%
Volatility factor	50.3	%	51.8	%	43.7	%
Expected Years	2.4 years		3.5 years		4.1 years

(1) The present value discount rate includes estimated risk premium.

PROPERTY AND EQUIPMENT, NET (Tables)

12 Months Ended

Dec. 31, 2021

Property, Plant and Equipment [Abstract]

Property and Equipment, Net

Depreciable lives are generally as follows:


Building and building improvements			25 to 30 years
Furniture and fixtures			5 to 7 years
Computer equipment			3 to 5 years
Business software			3 years
Office and other equipment			5 to 7 years
Instruments			5 years
Sample inventory			2 years

Property and equipment, net consisted of the following:


	December 31,
	2021		2020
Land	$	1,645	$	1,645
Building and building improvements	4,078		2,591
Computer equipment and software	2,541		2,218
Office and other equipment	1,958		1,060
Instruments	34,094		29,916
Sample inventory	2,483		2,453
Construction in progress	4,805		4,995
	51,604		44,878
Less: accumulated depreciation	(23,089)		(17,651)
Total property and equipment, net	$	28,515	$	27,227

ACCRUED COMPENSATION AND BENEFITS (Tables)

12 Months Ended

Dec. 31, 2021

Schedule of Accrued Compensation and Benefits

Accrued compensation and benefits consisted of the following:


	December 31,
	2021		2020
Accrued compensation and related costs	$	2,357	$	1,896
Accrued commissions	2,994		2,644
Total accrued compensation and benefits	$	5,351	$	4,540

DEBT AND CREDIT ARRANGEMENTS (Tables)

12 Months Ended

Dec. 31, 2021

Debt Disclosure [Abstract]

Schedule of Long-Term Debt

Long-term debt consisted of the following:


	December 31,
	2021		2020


Mortgage payable to affiliate	$	1,044	$	1,175
Total debt	1,044		1,175
Less: current maturities	137		131
Long-term debt, net of current maturities	$	907	$	1,044

Schedule of Aggregate Future Principal Payments

At December 31, 2021, the aggregate future principal payments on our debt arrangements are as follows:


2022	$	137
2023	144
2024	152
2025	160
2026	168
Thereafter	283
	$	1,044

- Definition

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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+ Details

INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2021

Income Tax Disclosure [Abstract]

Schedule of Components of Income Tax Expense (Benefit)

Total income tax expense (benefit) for the years ended December 31, 2021, 2020 and 2019 was allocated as follows:


	2021		2020		2019
Income from continuing operations	$	(1,128)	$	(723)	$	—
Income from discontinued operations	—		—		(660)
Total tax expense (benefit)	$	(1,128)	$	(723)	$	(660)

The components of income tax expense (benefit) from continuing operations for the years ended December 31, 2021, 2020 and 2019 are as follows:


	2021		2020		2019






Deferred:
Federal	$	—	$	—	$	1,033
State	—		—		37
Foreign	(1,128)		(723)		—


Decrease in valuation allowance	—		—		(1,070)
Total income tax expense (benefit)	$	(1,128)	$	(723)	$	—

Schedule of Income before Income Tax, Domestic and Foreign

For the years ended December 31, 2021, 2020 and 2019 loss from continuing operations before taxes of the Company consists of the following:


	2021		2020		2019
Domestic	$	(9,232)	$	(28,756)	$	(12,010)
Foreign	(8,156)		(4,911)		(675)
Total	$	(17,388)	$	(33,667)	$	(12,685)

Schedule of Reconciliation Between the Effective Tax Rate and the Statutory Tax Rate

The reconciliation between the effective tax rate and the statutory tax rate is as follows:


	December 31,
	2021		2020		2019
Federal statutory rate	21.0	%	21.0	%	21.0	%
State statutory rate, net of federal benefit	2.0	%	1.8	%	(0.7)	%
Effect of foreign rates different from statutory	(0.1)	%	0.1	%	—	%
Change in state rate	(1.3)	%	(2.5)	%	(1.3)	%
Excess tax benefits from stock plans	7.5	%	0.6	%	0.3	%
Nondeductible/nontaxable or other items	11.9	%	0.5	%	—	%
Unborn foreign tax deduction	(1.5)	%	4.0	%	—	%
Change in valuation allowance	(33.1)	%	(23.4)	%	(19.3)	%
Income tax (expense) benefit	6.3	%	2.1	%	—	%

Schedule of Deferred Tax Assets and Liabilities

The deferred tax assets and liabilities consisted of the following at December 31, 2021 and 2020:


	2021		2020
Deferred tax assets:
Inventories, net	$	4,206	$	2,715
Stock based compensation	2,454		1,938
Loss carryforwards	35,421		29,050
Credit carryforwards	176		176
Interest carryforward	338		1,851
Accrued Settlements	—		1,467
Other	444		382
Total deferred tax assets	43,039		37,579
Valuation allowance	(38,911)		(33,160)
Net deferred tax assets	4,128		4,419
Deferred tax liabilities:
Intangibles	(7,518)		(9,120)
Property, plant and equipment	(1,238)		(1,054)
Total deferred tax liabilities	(8,756)		(10,174)
Foreign currency translation impact	(143)		—
Deferred tax assets (liabilities), net	$	(4,771)	$	(5,755)

STOCKHOLDERS' EQUITY (Tables)

12 Months Ended

Dec. 31, 2021

Share-based Payment Arrangement [Abstract]

Schedule of Stock Option Activity

Our stock option activity and related information are summarized as follows:


	Options	Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Terms (in Years)
Outstanding at January 1, 2019	112,094	$	30.32	1.8
Forfeited or expired	(2,546)	$	27.61
Exercised	(38,920)	$	29.30
Outstanding at December 31, 2019	70,628	$	30.97	1.2
Forfeited or expired	(4,556)	$	30.97
Exercised	(53,270)	$	30.97
Outstanding at December 31, 2020	12,802	$	30.97	1.6
Forfeited or expired	(1,742)	$	30.97
Exercised	(4,422)	$	30.97
Outstanding at December 31, 2021	6,638	$	30.97	1.3

Schedule of Restricted Stock Activity

Our restricted stock activity and related information are summarized as follows:


	Restricted Stock	Weighted-Average Remaining Contractual Terms (in Years)
Outstanding at January 1, 2019	177,293	2.2
Granted	154,769
Forfeited	(9,616)
Outstanding at Vested	(4,444)
Outstanding at December 31, 2019	318,002	1.7
Granted	164,010
Forfeited	(1,885)
Outstanding at Vested	(43,397)
Outstanding at December 31, 2020	436,730	1.1
Granted	114,256
Forfeited	(6,354)
Vested	(176,186)
Outstanding at December 31, 2021	368,446	1.1
Restricted stock exercisable at December 31, 2021	—

Summary of Warrant Activity

Our warrant activity and related information are summarized below:


	Warrants	Weighted-Average Exercise Price
Outstanding at January 1, 2019	6,790	$	27.81
Forfeited or expired	(6,386)	$	27.61
Outstanding at December 31, 2019	404	$	30.97
Forfeited or expired	(404)	$	30.97
Outstanding at December 31, 2020	—	$	—
Forfeited or expired	—	$	—
Outstanding at December 31, 2021	—	$	—

NET LOSS PER SHARE (Tables)

12 Months Ended

Dec. 31, 2021

Earnings Per Share [Abstract]

Reconciliation of Basic and Diluted Net Loss Per Share Attributable to Common Stockholders

The following is a reconciliation of basic and diluted net loss per share attributable to common stockholders:


	Year Ended December 31,
	2021		2020		2019
Net loss from continuing operations	$	(16,260)	$	(32,944)	$	(12,685)
Net loss from discontinued operations	—		—		(1,046)
Net loss attributable to common stockholders - basic and diluted	$	(16,260)	$	(32,944)	$	(13,731)
Weighted average number of shares - basic and diluted	19,268,255		18,056,828		14,624,194
Net loss from continuing operations per share - basic and diluted	$	(0.84)	$	(1.82)	$	(0.87)
Net loss from discontinued operations per share - basic and diluted	—		—		(0.07)
Net loss per share - basic and diluted	$	(0.84)	$	(1.82)	$	(0.94)

Schedule of Antidilutive Shares Excluded from the Calculation of Diluted Net Loss Per Share

The following contingently issuable and convertible equity shares were excluded from the calculation of diluted net loss per share because their effect would have been anti-dilutive for all periods presented:


	Year Ended December 31,
	2021	2020	2019


Restricted stock	368,446	436,730	318,002
Stock options	6,638	12,802	70,628
Warrants	—	—	404
	375,084	449,532	389,034

BUSINESS SEGMENT (Tables)

12 Months Ended

Dec. 31, 2021

Segment Reporting [Abstract]

Schedule of Product Sales by Geographic Location

Disaggregated revenue - product sales by source were as follows:


	Year Ended December 31,
Product sales by geographic location:	2021		2020		2019
U.S.	$	77,781	$	62,966	$	55,055
International	20,268		8,112		17,497
Total	$	98,049	$	71,078	$	72,552

Schedule of Product Sales by Category


	Year Ended December 31,
Product sales by category:	2021		2020		2019
Trauma and deformity	$	65,829	$	47,677	$	49,371
Scoliosis	28,046		20,738		21,485
Sports medicine/other	4,174		2,663		1,696
Total	$	98,049	$	71,078	$	72,552

QUARTERLY FINANCIAL INFORMATION (UNAUDITED) (Tables)

12 Months Ended

Dec. 31, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Quarterly Financial Information

The quarterly financial data presented should be read in conjunction with the consolidated financial statements and related notes.


	Three Months Ended
	Mar. 31, 2021		Jun. 30, 2021		Sep. 30, 2021		Dec. 31, 2021
Net revenue	$	21,462	$	26,695	$	25,079	$	24,813
Gross profit	16,325		20,443		18,554		18,081
Operating loss	(5,973)		(2,846)		(3,644)		(5,561)
Loss before income tax benefit	(10,691)		(4,042)		(2,489)		(166)
Provision for income taxes (benefit)	(312)		(286)		(292)		(238)

Net loss	(10,379)		(3,756)		(2,197)		72

Net loss per share - basic and diluted	$	(0.54)	$	(0.19)	$	(0.11)	$	—
	Three Months Ended
	Mar. 31, 2020		Jun. 30, 2020		Sep. 30, 2020		Dec. 31, 2020
Net revenue	$	16,356	$	13,593	$	22,205	$	18,924
Gross profit	12,213		10,061		17,639		15,118
Operating loss	(4,497)		(7,017)		(2,498)		(12,743)
Loss before income tax benefit	(4,945)		(9,447)		(4,539)		(14,736)
Provision for income taxes (benefit)	—		—		—		(723)

Net loss	(4,945)		(9,447)		(4,539)		(14,013)


Net loss per share - basic and diluted	$	(0.30)	$	(0.54)	$	(0.24)	$	(0.73)

BUSINESS (Details) children in Thousands, $ in Millions	Dec. 31, 2021 USD ($) children
Business Acquisition
Estimated market portion opportunities	$ 3,300
Children impacted \| children	234
U.S.
Business Acquisition
Estimated market portion opportunities	$ 1,500

SIGNIFICANT ACCOUNTING POLICIES - Basis of Presentation (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Accounting Policies [Abstract]
Accumulated deficit	$ 178,026	$ 161,766

- Definition

The cumulative amount of the reporting entity's undistributed earnings or deficit.

+ References + Details

SIGNIFICANT ACCOUNTING POLICIES - Revenue Recognition (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2021	Sep. 30, 2021	Jun. 30, 2021	Mar. 31, 2021	Dec. 31, 2020	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Disaggregation of Revenue
Net revenue	$ 24,813	$ 25,079	$ 26,695	$ 21,462	$ 18,924	$ 22,205	$ 13,593	$ 16,356	$ 98,049	$ 71,078	$ 72,552
Scenario, Adjustment
Disaggregation of Revenue
Net revenue										$ (2,730)

- Definition

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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-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8736-108599

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 42
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9054-108599

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 5
-URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130545-203045

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 924
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SAB Topic 11.L)
-URI http://asc.fasb.org/extlink&oid=6472922&loc=d3e499488-122856

+ Details

SIGNIFICANT ACCOUNTING POLICIES - Restricted Cash (Details) € in Thousands, $ in Thousands	Dec. 31, 2021 USD ($)	Dec. 31, 2020 USD ($)	Dec. 31, 2020 EUR (€)
Accounting Policies [Abstract]
Escrow deposit	$ 1,250	$ 1,250
Restricted cash	$ 1,365	$ 1,374	€ 100

SIGNIFICANT ACCOUNTING POLICIES - Accounts Receivable and Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Accounts Receivable, Allowance for Credit Loss
Balance at beginning of year	$ 433	$ 506	$ 134
Adjustments charged to expense (income)	(5)	274	424
Write-offs	81	347	52
Balance at end of year	$ 347	$ 433	$ 506

SIGNIFICANT ACCOUNTING POLICIES - Inventories, net (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Accounting Policies [Abstract]
Charges for obsolete inventory	$ 1,100	$ 1,269	$ 604

SIGNIFICANT ACCOUNTING POLICIES - Costs Related to Common Stock Offerings (Details) - USD ($) $ in Thousands	Jun. 22, 2020	Dec. 13, 2019
Follow-on Offering
Class of Stock
Initial public offering costs, capitalized	$ 481	$ 235

SIGNIFICANT ACCOUNTING POLICIES - Property and Equipment, net (Details) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Property, Plant and Equipment
Impairment of finite-lived intangible assets	$ 0	$ 0	$ 0
Minimum
Property, Plant and Equipment
Intangible asset, useful life (in years)	3 years
Maximum
Property, Plant and Equipment
Intangible asset, useful life (in years)	20 years
Building and building improvements \| Minimum
Property, Plant and Equipment
Depreciable lives (in years)	25 years
Building and building improvements \| Maximum
Property, Plant and Equipment
Depreciable lives (in years)	30 years
Furniture and fixtures \| Minimum
Property, Plant and Equipment
Depreciable lives (in years)	5 years
Furniture and fixtures \| Maximum
Property, Plant and Equipment
Depreciable lives (in years)	7 years
Computer equipment \| Minimum
Property, Plant and Equipment
Depreciable lives (in years)	3 years
Computer equipment \| Maximum
Property, Plant and Equipment
Depreciable lives (in years)	5 years
Business software
Property, Plant and Equipment
Depreciable lives (in years)	3 years
Office and other equipment \| Minimum
Property, Plant and Equipment
Depreciable lives (in years)	5 years
Office and other equipment \| Maximum
Property, Plant and Equipment
Depreciable lives (in years)	7 years
Instruments
Property, Plant and Equipment
Depreciable lives (in years)	5 years
Sample inventory
Property, Plant and Equipment
Depreciable lives (in years)	2 years

SIGNIFICANT ACCOUNTING POLICIES - Goodwill and Intangible Assets (Details)	12 Months Ended
	Dec. 31, 2021 USD ($) reportingUnit	Dec. 31, 2020 USD ($)	Dec. 31, 2019 USD ($)
Accounting Policies [Abstract]
Number of reporting units \| reportingUnit	1
Impairment of indefinitely-lived tradename assets \| $	$ 0	$ 0	$ 0

SIGNIFICANT ACCOUNTING POLICIES - Acquisition Payable and Contingent Consideration (Details) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Accounting Policies [Abstract]
Contingent consideration, accretion expense	$ 2,155,000	$ 2,397,000
Fair value adjustment of contingent consideration	$ (1,800,000)	$ 3,520,000	$ 0

SIGNIFICANT ACCOUNTING POLICIES - Shipping and Handling Costs (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
New Accounting Pronouncements or Change in Accounting Principle
Cost of revenue	$ 24,646	$ 16,047	$ 17,933
Shipping and Handling, Billed
New Accounting Pronouncements or Change in Accounting Principle
Cost of revenue	803	635	599
Shipping and Handling, Not Billed
New Accounting Pronouncements or Change in Accounting Principle
Cost of revenue	$ 2,899	$ 2,261	$ 2,788

SIGNIFICANT ACCOUNTING POLICIES - Advertising Costs (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Accounting Policies [Abstract]
Advertising costs	$ 898	$ 1,231	$ 1,422

SIGNIFICANT ACCOUNTING POLICIES - Stock-Based Compensation (Details) - shares	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Share-based Compensation Arrangement by Share-based Payment Award
Options, granted (in shares)	0	0	0
Stock options
Share-based Compensation Arrangement by Share-based Payment Award
Vesting period (in years)	3 years
Options, granted (in shares)	0	0	0
Stock options \| Maximum
Share-based Compensation Arrangement by Share-based Payment Award
Vesting period (in years)	3 years
Restricted stock \| Maximum
Share-based Compensation Arrangement by Share-based Payment Award
Vesting period (in years)	6 years
2007 Plan
Share-based Compensation Arrangement by Share-based Payment Award
Shares available for award (in shares)	1,585,000
2017 Plan
Share-based Compensation Arrangement by Share-based Payment Award
Shares available for award (in shares)	1,832,460

SIGNIFICANT ACCOUNTING POLICIES - Foundation for Advancing Pediatric Orthopedics (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Accounting Policies [Abstract]
Contributions to charity fund	$ 88	$ 325	$ 500

SIGNIFICANT ACCOUNTING POLICIES - Litigation and Contingencies (Details) - USD ($)	Dec. 31, 2021	Dec. 31, 2020
Accounting Policies [Abstract]
Accrued legal settlements	$ 0	$ 6,342,000

BUSINESS COMBINATIONS - ApiFix Narrative (Details)		12 Months Ended
BUSINESS COMBINATIONS - ApiFix Narrative (Details)	Apr. 01, 2020 USD ($) procedure $ / shares shares	Dec. 31, 2021 USD ($) $ / shares	Dec. 31, 2020 USD ($) $ / shares	Dec. 31, 2019 USD ($)	Mar. 09, 2020 $ / shares
Business Acquisition
Common stock, par value (in dollars per share) \| $ / shares		$ 0.00025	$ 0.00025		$ 0.00025
Fair value adjustment of contingent consideration		$ (1,800,000)	$ 3,520,000	$ 0
ApiFix
Business Acquisition
Cash consideration	$ 2,000,000
Cash acquired	$ 344,000
Consideration for acquisition (in shares) \| shares	934,783
Common stock, par value (in dollars per share) \| $ / shares	$ 0.00025
Issuance of common stock	$ 35,176,000
Common stock (in dollars per share) \| $ / shares	$ 37.63
Anniversary payments	$ 30,000,000
System sales payment	41,741,000
Fair value of total acquisition consideration	87,379,000
Acquisition related costs	$ 311,000
Number of clinical procedures \| procedure	150
Revenue multiplier	2.25
Minimum percentage of contingent consideration payable in cash	25.00%
Percentage on contingent consideration that can be settled in shares	75.00%
ApiFix \| Second Anniversary
Business Acquisition
Anniversary payments	$ 13,000,000
ApiFix \| Third Anniversary
Business Acquisition
Anniversary payments	8,000,000
ApiFix \| Fourth Anniversary
Business Acquisition
Anniversary payments	$ 9,000,000

BUSINESS COMBINATIONS - ApiFix Consideration (Details) - ApiFix $ in Thousands	Apr. 01, 2020 USD ($)
Consideration
Cash consideration	$ 2,000
Payment of ApiFix transaction related costs	67
Issuance of common stock	35,176
Anniversary Payments	30,000
System sales payment	41,741
Total consideration transferred	108,984
Present Value
Cash consideration	2,000
Payment of ApiFix transaction related costs	67
Issuance of common stock	35,176
Anniversary Payments	22,620
System sales payment	27,190
Total consideration transferred	$ 87,053

BUSINESS COMBINATIONS - Assets acquired and liabilities assumed (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020	Apr. 01, 2020	Mar. 09, 2020	Dec. 31, 2019	Jun. 04, 2019
Liabilities
Goodwill	$ 72,349	$ 70,511			$ 13,773
ApiFix
Business Acquisition
Fair value of total acquisition consideration			$ 87,379
Assets
Cash			344
Accounts receivable-trade			245
Inventories			685
Prepaid expenses and other current assets			77
Property and equipment			153
Amortizable intangible assets			32,150
Other intangible assets			8,640
Operating lease right-of-use asset			104
Total assets			42,398
Liabilities
Accounts payable and accrued liabilities			226
Operating lease liabilities			106
Other current liabilities			270
Deferred income taxes			6,487
Total liabilities			7,089
Less: total net assets			35,309
Goodwill			$ 52,070
Telos
Business Acquisition
Fair value of total acquisition consideration				$ 3,318
Assets
Cash				81
Accounts receivable-trade				215
Prepaid expenses and other current assets				38
Property and equipment				10
Amortizable intangible assets				950
Other intangible assets				210
Total assets				1,504
Liabilities
Accounts payable and accrued liabilities				60
Total liabilities				60
Less: total net assets				1,444
Goodwill				$ 1,874
Vilex and Orthex
Business Acquisition
Fair value of total acquisition consideration						$ 60,184
Assets
Cash						348
Accounts receivable-trade						2,088
Inventories						3,652
Prepaid expenses and other current assets						12
Property and equipment						7,540
Amortizable intangible assets						31,180
Operating lease right-of-use asset						323
Total assets						45,143
Liabilities
Accounts payable and accrued liabilities						563
Operating lease liabilities						323
Deferred income taxes						1,175
Other long-term liabilities						68
Total liabilities						2,129
Less: total net assets						43,014
Goodwill						$ 17,170

BUSINESS COMBINATIONS - Estimated fair value and useful life of identifiable intangible assets (Details) - USD ($) $ in Thousands	Apr. 01, 2020	Mar. 09, 2020	Jun. 04, 2019
ApiFix
Business Acquisition
Fair value of identifiable intangible assets	$ 40,790
ApiFix \| Patents
Business Acquisition
Finite-lived intangible assets acquired	$ 31,720
Remaining economic useful life (in years)	15 years
ApiFix \| Customer Relationships
Business Acquisition
Finite-lived intangible assets acquired	$ 230
Remaining economic useful life (in years)	10 years
ApiFix \| Non-competition Agreements
Business Acquisition
Finite-lived intangible assets acquired	$ 200
Remaining economic useful life (in years)	4 years
ApiFix \| Trademarks / Names
Business Acquisition
Indefinite-lived intangible assets acquired	$ 8,640
Telos
Business Acquisition
Fair value of identifiable intangible assets		$ 1,160
Telos \| Customer Relationships
Business Acquisition
Finite-lived intangible assets acquired		$ 910
Remaining economic useful life (in years)		10 years
Telos \| Non-competition Agreements
Business Acquisition
Finite-lived intangible assets acquired		$ 40
Remaining economic useful life (in years)		5 years
Telos \| Trademarks / Names
Business Acquisition
Indefinite-lived intangible assets acquired		$ 210
Vilex and Orthex
Business Acquisition
Fair value of identifiable intangible assets			$ 31,180
Vilex and Orthex \| Patents
Business Acquisition
Finite-lived intangible assets acquired			$ 22,390
Remaining economic useful life (in years)			15 years
Vilex and Orthex \| Customer Relationships
Business Acquisition
Finite-lived intangible assets acquired			$ 2,570
Remaining economic useful life (in years)			12 years
Vilex and Orthex \| Non-competition Agreements
Business Acquisition
Finite-lived intangible assets acquired			$ 60
Remaining economic useful life (in years)			5 years
Vilex and Orthex \| Internally Developed Software
Business Acquisition
Finite-lived intangible assets acquired			$ 1,550
Remaining economic useful life (in years)			10 years
Vilex and Orthex \| Trademarks / Names
Business Acquisition
Indefinite-lived intangible assets acquired			$ 4,610

BUSINESS COMBINATIONS - Summary of the Present Value of Payments (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020	Apr. 01, 2020
Business Acquisition
Current portion of acquisition installment payable	$ 12,862	$ 12,233
Acquisition installment payable, net of current portion	14,309	12,784
ApiFix future consideration, net of current portion	28,910	30,710
ApiFix
Business Acquisition
Anniversary payments	27,171	25,017	$ 22,620
Current portion of acquisition installment payable	12,862	12,233	10,980
Acquisition installment payable, net of current portion	14,309	12,784	11,640
System sales payment	28,910	30,710	27,190
ApiFix future consideration, net of current portion	43,219	43,494	38,830
ApiFix \| Second Anniversary
Business Acquisition
Anniversary payments	12,862	12,233	10,980
ApiFix \| Third Anniversary
Business Acquisition
Anniversary payments	7,075	6,335	5,780
ApiFix \| Fourth Anniversary
Business Acquisition
Anniversary payments	$ 7,234	$ 6,449	$ 5,860

BUSINESS COMBINATIONS - Telos Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands	Mar. 09, 2020	Dec. 31, 2021	Dec. 31, 2020
Business Acquisition
Common stock, par value (in dollars per share)	$ 0.00025	$ 0.00025	$ 0.00025
Telos
Business Acquisition
Cash consideration	$ 1,750
Cash acquired	$ 81
Consideration for acquisition (in shares)	36,628
Common stock (in dollars per share)	$ 42.81
Acquisition related costs	$ 25

BUSINESS COMBINATIONS - Vilex and Orthex Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands		12 Months Ended
	Jun. 04, 2019	Dec. 31, 2019	Dec. 31, 2018	Dec. 31, 2021	Dec. 31, 2020	Mar. 09, 2020
Business Acquisition
Common stock, par value (in dollars per share)				$ 0.00025	$ 0.00025	$ 0.00025
Disposed of by sale
Business Acquisition
Divestiture purchase price		$ 25,000			$ 25,000
Divestiture purchase price, attributable to deferred revenue		12,410
Allocated purchase price		12,590
Vilex and Orthex
Business Acquisition
Cash consideration	$ 50,000
Consideration for acquisition (in shares)	245,352
Common stock, par value (in dollars per share)	$ 0.00025
Common stock (in dollars per share)	$ 40.76
Trading period (in days)	30 days
Escrow deposit	$ 3,000
Escrow deposit period (in months)	20 months
Acquisition related costs	$ 737
Pro forma net revenue		74,488	$ 62,607
Pro forma net loss		$ (12,601)	$ (13,439)

DISCONTINUED OPERATIONS - Balance Sheet (Details) - Disposed of by sale - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2019	Dec. 31, 2020
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations
Divestiture purchase price	$ 25,000	$ 25,000
Disposal Group, Including Discontinued Operation, Assets
Cash	515
Accounts Receivable - trade, less allowance for doubtful accounts	928
Inventories, net	2,060
Prepaid expenses and other current assets	24
Property and equipment, net	6,246
Amortizable intangible assets	13,390
Goodwill	3,397
Other intangible assets	380
Operating lease right-of-use asset	216
Total assets divested	27,156
Disposal Group, Including Discontinued Operation, Liabilities
Accounts payable - trade	37
Accrued compensation and benefits	171
Operating lease liabilities	199
Deferred tax liability	1,175
Other current liabilities	13
Total liabilities divested	1,595
Net assets sold	25,561
Allocated purchase price	25,000	$ 25,000
Loss on divestiture	$ (561)

DISCONTINUED OPERATIONS - Income Statement (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Disposal Group, Including Discontinued Operation, Income Statement Disclosures
Net loss from discontinued operations, net of tax	$ 0	$ 0	$ 1,046
Disposed of by sale
Disposal Group, Including Discontinued Operation, Income Statement Disclosures
Net revenue			3,069
Cost of revenue			(286)
Sales and marketing			(692)
General and administrative			(2,103)
Other income (expense), net			(9)
Pretax net loss of discontinued operations			(21)
Income tax expense			(464)
Net loss on discontinued operations			(485)
Net loss from discontinued operations, net of tax			$ 1,046

GOODWILL AND INTANGIBLE ASSETS - Narrative (Details)									12 Months Ended
GOODWILL AND INTANGIBLE ASSETS - Narrative (Details)	Oct. 20, 2021 USD ($) $ / shares shares	Sep. 03, 2021 USD ($)	Jul. 20, 2021 USD ($)	Mar. 19, 2021 USD ($)	Jun. 10, 2020 USD ($)	Apr. 01, 2020 USD ($)	Mar. 09, 2020 USD ($)	Jun. 04, 2019 USD ($)	Dec. 31, 2021 USD ($) reportingUnit	Dec. 31, 2020 USD ($)	Dec. 31, 2019 USD ($)
Indefinite-lived Intangible Assets
Number of reporting units \| reportingUnit									1
Amortization of expense									$ 4,531,000	$ 3,246,000	$ 887,000
Payments for asset acquisition									650,000	0	0
Share price \| $ / shares	$ 64.83
Non-amortizing intangible assets									14,268,000	13,961,000
Impairment of indefinitely-lived assets									0	0	$ 0
License agreements
Indefinite-lived Intangible Assets
Payments to acquire intangible assets				$ 2,858,000
Intangible asset, useful life (in years)				8 years
Intellectual Property
Indefinite-lived Intangible Assets
Finite-lived intangible assets acquired					$ 3,394,000
Devise Ortho
Indefinite-lived Intangible Assets
Payments to acquire inventory	$ 108,000
Consideration to acquire assets	948,000
Payments for asset acquisition	$ 650,000
Shares issued as compensation (shares) \| shares	4,599
Shares issued as compensation	$ 298,000
Devise Ortho \| Patents
Indefinite-lived Intangible Assets
Payments to acquire intangible assets	$ 840,000
Intangible asset, useful life (in years)	16 years
7D Surgical FLASH \| License agreements
Indefinite-lived Intangible Assets
Payments to acquire intangible assets		$ 750,000
Intangible asset, useful life (in years)		3 years
License agreement term (years)		5 years
FIREFLY Technology \| License agreements
Indefinite-lived Intangible Assets
Payments to acquire intangible assets			$ 4,300,000
Finite lived intangible asset useful life extension period			5 years
ApiFix \| Patents
Indefinite-lived Intangible Assets
Finite-lived intangible assets acquired						$ 31,720,000
Trademarks
Indefinite-lived Intangible Assets
Non-amortizing intangible assets									$ 14,268,000	$ 13,961,000
Trademarks \| Orthex
Indefinite-lived Intangible Assets
Indefinite-lived intangible assets acquired								$ 4,230,000
Trademarks \| Telos
Indefinite-lived Intangible Assets
Indefinite-lived intangible assets acquired							$ 210,000
Trademarks / Names \| Telos
Indefinite-lived Intangible Assets
Indefinite-lived intangible assets acquired							$ 210,000
Trademarks / Names \| ApiFix
Indefinite-lived Intangible Assets
Indefinite-lived intangible assets acquired						$ 8,640,000

GOODWILL AND INTANGIBLE ASSETS - Schedule of Goodwill (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Goodwill
Goodwill, beginning balance	$ 70,511	$ 13,773
Orthex measurement period adjustment		(688)
Foreign currency translation impact	1,838	3,482
Goodwill, ending balance	$ 72,349	70,511
Telos
Goodwill
Acquisition		1,874
ApiFix
Goodwill
Acquisition		$ 52,070

GOODWILL AND INTANGIBLE ASSETS - Schedule of Intangible Assets (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Finite-Lived Intangible Assets, Net
Gross Intangible Assets	$ 65,014	$ 55,118
Accumulated Amortization	(9,520)	(4,834)
Net Intangible Assets	$ 55,494	$ 50,284
Patents
Finite-Lived Intangible Assets, Net
Weighted-Average Amortization Period	13 years 8 months 12 days	14 years 8 months 12 days
Gross Intangible Assets	$ 44,493	$ 43,363
Accumulated Amortization	(5,664)	(2,650)
Net Intangible Assets	$ 38,829	$ 40,713
Intellectual Property
Finite-Lived Intangible Assets, Net
Weighted-Average Amortization Period	10 years 1 month 6 days	10 years 3 months 18 days
Gross Intangible Assets	$ 9,847	$ 8,990
Accumulated Amortization	(1,408)	(744)
Net Intangible Assets	$ 8,439	$ 8,246
License agreements
Finite-Lived Intangible Assets, Net
Weighted-Average Amortization Period	5 years 6 months	2 years 8 months 12 days
Gross Intangible Assets	$ 10,674	$ 2,765
Accumulated Amortization	(2,448)	(1,440)
Net Intangible Assets	$ 8,226	$ 1,325

GOODWILL AND INTANGIBLE ASSETS - Future Amortization Expense (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Year Ending December 31:
2022	$ 5,216
2023	5,245
2024	5,144
2025	4,954
2026	4,936
Thereafter	29,999
Net Intangible Assets	$ 55,494	$ 50,284

FAIR VALUE OF FINANCIAL INSTRUMENTS - Schedule of Assets and Liabilities Measured at Fair Value (Details) - Fair Value, Recurring - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Cash Equivalents		$ 15,002
Contingent Consideration	$ 28,910	30,710
Exchange Trade Mutual Funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Short term investments		35,208
Corporate Bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Short term investments	22,476	9,616
Treasury Bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Short term investments	14,317	6,520
Asset Backed Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Short term investments	8,272
Other
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Short term investments	837	3,797
Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Cash Equivalents		15,002
Contingent Consideration	0	0
Level 1 \| Exchange Trade Mutual Funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Short term investments		35,208
Level 1 \| Corporate Bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Short term investments	22,476	9,616
Level 1 \| Treasury Bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Short term investments	14,317	6,520
Level 1 \| Asset Backed Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Short term investments	0
Level 1 \| Other
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Short term investments	837	3,797
Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Cash Equivalents		0
Contingent Consideration	0	0
Level 2 \| Exchange Trade Mutual Funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Short term investments		0
Level 2 \| Corporate Bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Short term investments	0	0
Level 2 \| Treasury Bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Short term investments	0	0
Level 2 \| Asset Backed Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Short term investments	8,272
Level 2 \| Other
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Short term investments	0	0
Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Cash Equivalents		0
Contingent Consideration	28,910	30,710
Level 3 \| Exchange Trade Mutual Funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Short term investments		0
Level 3 \| Corporate Bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Short term investments	0	0
Level 3 \| Treasury Bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Short term investments	0	0
Level 3 \| Asset Backed Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Short term investments	0
Level 3 \| Other
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Short term investments	$ 0	$ 0

FAIR VALUE OF FINANCIAL INSTRUMENTS (Details) - USD ($)	12 Months Ended
FAIR VALUE OF FINANCIAL INSTRUMENTS (Details) - USD ($)	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Fair Value Disclosures [Abstract]
Fair value adjustment of contingent consideration	$ (1,800,000)	$ 3,520,000	$ 0

FAIR VALUE OF FINANCIAL INSTRUMENTS - Change in Fair Value of Level 3 Instruments (Details) - Contingent consideration liability - Level 3 - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Fair value adjustment of contingent consideration	$ (1,800)	$ 3,520
Fair Value, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Contingent consideration, beginning balance	30,710	0
Contingent consideration recorded as a result of the acquisition (Note 3)		27,190
Contingent consideration, ending balance	$ 28,910	$ 30,710

FAIR VALUE OF FINANCIAL INSTRUMENTS - Fair Value Measurements of Contingent Consideration (Details) - Fair Value, Recurring - Level 3 - Discounted cash flow, Monte Carlo		12 Months Ended
	Apr. 01, 2020	Dec. 31, 2021	Dec. 31, 2020
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Expected Years	4 years 1 month 6 days	2 years 4 months 24 days	3 years 6 months
Present value discount rate
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Contingent consideration, measurement input	23.10%	18.40%	25.80%
Volatility factor
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Contingent consideration, measurement input	43.70%	50.30%	51.80%

PROPERTY AND EQUIPMENT, NET (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Property, Plant and Equipment
Property and equipment, gross	$ 51,604	$ 44,878
Less: accumulated depreciation	(23,089)	(17,651)
Total property and equipment, net	28,515	27,227
Land
Property, Plant and Equipment
Property and equipment, gross	1,645	1,645
Building and building improvements
Property, Plant and Equipment
Property and equipment, gross	4,078	2,591
Computer equipment and software
Property, Plant and Equipment
Property and equipment, gross	2,541	2,218
Office and other equipment
Property, Plant and Equipment
Property and equipment, gross	1,958	1,060
Instruments
Property, Plant and Equipment
Property and equipment, gross	34,094	29,916
Sample inventory
Property, Plant and Equipment
Property and equipment, gross	2,483	2,453
Construction in progress
Property, Plant and Equipment
Property and equipment, gross	$ 4,805	$ 4,995

PROPERTY AND EQUIPMENT, NET - Deprecation (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Property, Plant and Equipment [Abstract]
Depreciation expense	$ 6,148	$ 4,660	$ 3,749

ACCRUED COMPENSATION AND BENEFITS (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Compensation Related Costs [Abstract]
Accrued compensation and related costs	$ 2,357	$ 1,896
Accrued commissions	2,994	2,644
Total accrued compensation and benefits	$ 5,351	$ 4,540

DEBT AND CREDIT ARRANGEMENTS - Schedule of Long-term Debt (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Debt Instrument
Total debt	$ 1,044	$ 1,175
Less: current maturities	137	131
Long-term debt, net of current maturities	907	1,044
Mortgage payable to affiliate
Debt Instrument
Total debt	1,044	1,175
Less: current maturities	$ 137	$ 131

- Definition

Amount, after unamortized (discount) premium and debt issuance costs, of long-term debt. Includes, but not limited to, notes payable, bonds payable, debentures, mortgage loans and commercial paper. Excludes capital lease obligations.

+ References + Details

DEBT AND CREDIT ARRANGEMENTS - Narrative (Details) - USD ($)							12 Months Ended
	Dec. 31, 2021	Aug. 04, 2020	Jul. 15, 2020	Jan. 04, 2020	Dec. 31, 2019	Dec. 31, 2017	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Jun. 04, 2019
Debt Instrument
Payment of revolving credit facility with affiliate							$ 0	$ 25,000,000	$ 0
Payments on note with affiliate							0	25,000,000	0
Current principal due	$ 137,000						137,000	131,000
Revolving Credit Facility
Debt Instrument
Revolving credit facility						$ 15,000,000
Debt instrument, interest rate, effective percentage						10.00%
Payment of revolving credit facility with affiliate				$ 5,000,000
Revolving Credit Facility \| Second Amended Loan Agreement
Debt Instrument
Revolving credit facility		$ 25,000,000
Unused commitment fee percentage		0.50%
Commitment fee							$ 127,000	52,000
Interest rate		10.00%
Revolving Credit Facility \| Third Amended Loan Agreement
Debt Instrument
Interest rate	10.00%						10.00%
Revolving Credit Facility \| Three month LIBOR
Debt Instrument
Debt instrument, basis spread on variable rate						8.61%
Revolving Credit Facility \| Three month LIBOR \| Second Amended Loan Agreement
Debt Instrument
Debt instrument, basis spread on variable rate		8.61%
Revolving Credit Facility \| SOFR \| Third Amended Loan Agreement
Debt Instrument
Debt instrument, basis spread on variable rate	8.69%
Term Loan
Debt Instrument
Interest expense related to debt							$ 56,000	1,233,000	$ 4,229,000
Term Loan \| Term Note A
Debt Instrument
Long term debt face amount						$ 20,000,000
Debt instrument, interest rate, effective percentage						10.00%
Payment of revolving credit facility with affiliate			$ 20,000,000
Payments on note with affiliate			$ 20,000,000
Term Loan \| Term Note B
Debt Instrument
Long term debt face amount										$ 30,000,000
Debt instrument, interest rate, effective percentage					10.00%				10.00%
Payment of revolving credit facility with affiliate					$ 25,000,000
Payments on note with affiliate					25,000,000
Term Loan \| Three month LIBOR \| Term Note A
Debt Instrument
Debt instrument, basis spread on variable rate						8.61%
Term Loan \| Three month LIBOR \| Term Note B
Debt Instrument
Debt instrument, basis spread on variable rate									8.61%
Term Loan \| Revolving Credit Facility \| Term Note B
Debt Instrument
Payment of revolving credit facility with affiliate					5,000,000
Payments on note with affiliate					$ 5,000,000
Mortgage payable to affiliate
Debt Instrument
Interest rate	5.00%						5.00%
Monthly interest and principal installments							$ 16,000
Current principal due	$ 137,000						$ 137,000	$ 131,000

DEBT AND CREDIT ARRANGEMENTS - Future Principal Payments (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Maturities of Long-term Debt
2022	$ 137
2023	144
2024	152
2025	160
2026	168
Thereafter	283
Total debt	$ 1,044	$ 1,175

- Definition

+ References + Details

INCOME TAXES - Narrative (Details) - USD ($)	Dec. 31, 2021	Dec. 31, 2020
Income Tax Disclosure [Abstract]
Loss carryforwards, federal	$ 114,008,000
Loss carryforwards, state	73,997,000
Loss carryforwards, foreign	22,671,000
Tax credit carryforward	176,000
Estimated limitation on losses generated prior to ownership change date	23,920,000
Estimated annual limitation of losses	9,736,000	$ 1,062,000
Increase of estimated annual limitation of first five years	22,430,000
Reserve for uncertain income tax positions		$ 0
Cash held by foreign operations	$ 2,444,000

INCOME TAXES - Income taxes from continuing and discontinued operations (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2021	Sep. 30, 2021	Jun. 30, 2021	Mar. 31, 2021	Dec. 31, 2020	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Income Tax Disclosure [Abstract]
Provision for income taxes (benefit)	$ (238)	$ (292)	$ (286)	$ (312)	$ (723)	$ 0	$ 0	$ 0	$ (1,128)	$ (723)	$ 0
Income from discontinued operations									0	0	(660)
Total tax expense (benefit)									$ (1,128)	$ (723)	$ (660)

- Definition

Amount of tax expense (benefit) related to a discontinued operation. Includes, but is not limited to, tax expense (benefit) related to income (loss) from operations during the phase-out period, tax expense (benefit) related to gain (loss) on disposal, tax expense (benefit) related to gain (loss) for reversal of write-down (write-down) to fair value, less cost to sell, and tax expense (benefit) related to adjustments of a prior period gain (loss) on disposal.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 205
-SubTopic 20
-Section 45
-Paragraph 3B
-URI http://asc.fasb.org/extlink&oid=109222160&loc=SL51721525-107759

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 20
-Section 45
-Paragraph 2
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=123586238&loc=d3e38679-109324

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-Name Accounting Standards Codification
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
-Topic 740
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-Name Accounting Standards Codification
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
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-URI http://asc.fasb.org/extlink&oid=121826272&loc=d3e32672-109319

+ Details

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References + Details

INCOME TAXES - Components of income from continuing operations before taxes (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2021	Sep. 30, 2021	Jun. 30, 2021	Mar. 31, 2021	Dec. 31, 2020	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Income Tax Disclosure [Abstract]
Domestic									$ (9,232)	$ (28,756)	$ (12,010)
Foreign									(8,156)	(4,911)	(675)
Loss before income taxes	$ (166)	$ (2,489)	$ (4,042)	$ (10,691)	$ (14,736)	$ (4,539)	$ (9,447)	$ (4,945)	$ (17,388)	$ (33,667)	$ (12,685)

- Definition

Amount of income (loss) from continuing operations, including income (loss) from equity method investments, before deduction of income tax expense (benefit), and income (loss) attributable to noncontrolling interest.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (c)
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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+ Details

INCOME TAXES - Components of income tax expense (benefit) (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2021	Sep. 30, 2021	Jun. 30, 2021	Mar. 31, 2021	Dec. 31, 2020	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Deferred:
Federal									$ 0	$ 0	$ 1,033
State									0	0	37
Foreign									(1,128)	(723)	0
Decrease in valuation allowance									0	0	(1,070)
Total income tax expense (benefit)	$ (238)	$ (292)	$ (286)	$ (312)	$ (723)	$ 0	$ 0	$ 0	$ (1,128)	$ (723)	$ 0

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References + Details

INCOME TAXES - Reconciliation between the effective tax rate and the statutory tax rate (Details)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Income Tax Disclosure [Abstract]
Federal statutory rate	21.00%	21.00%	21.00%
State statutory rate, net of federal benefit	2.00%	1.80%	(0.70%)
Effect of foreign rates different from statutory	(0.10%)	0.10%	0.00%
Change in state rate	(1.30%)	(2.50%)	(1.30%)
Excess tax benefits from stock plans	7.50%	0.60%	0.30%
Nondeductible/nontaxable or other items	11.90%	0.50%	0.00%
Unborn foreign tax deduction	(1.50%)	4.00%	0.00%
Change in valuation allowance	(33.10%)	(23.40%)	(19.30%)
Income tax (expense) benefit	6.30%	2.10%	0.00%

INCOME TAXES - Deferred tax assets and liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020
Deferred tax assets:
Inventories, net	$ 4,206	$ 2,715
Stock based compensation	2,454	1,938
Loss carryforwards	35,421	29,050
Credit carryforwards	176	176
Interest carryforward	338	1,851
Accrued Settlements	0	1,467
Other	444	382
Total deferred tax assets	43,039	37,579
Valuation allowance	(38,911)	(33,160)
Net deferred tax assets	4,128	4,419
Deferred tax liabilities:
Intangibles	(7,518)	(9,120)
Property, plant and equipment	(1,238)	(1,054)
Total deferred tax liabilities	(8,756)	(10,174)
Foreign currency translation impact	(143)	0
Deferred tax assets (liabilities), net	$ (4,771)	$ (5,755)

STOCKHOLDERS' EQUITY (Details)	Dec. 31, 2021 shares
2007 Plan
Share-based Compensation Arrangement by Share-based Payment Award
Shares available for award (in shares)	1,585,000
2017 Plan
Share-based Compensation Arrangement by Share-based Payment Award
Shares available for award (in shares)	1,832,460
Shares available for grant (in shares)	694,186

STOCKHOLDERS' EQUITY - Stock Options (Details) - USD ($)	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Share-based Compensation Arrangement by Share-based Payment Award
Options, granted (in shares)	0	0	0
Options
Exercised (in shares)	(4,422)	(53,270)	(38,920)
Stock options
Share-based Compensation Arrangement by Share-based Payment Award
Options, granted (in shares)	0	0	0
Options
Outstanding at period start (in shares)	12,802	70,628	112,094
Forfeited or expired (in shares)	(1,742)	(4,556)	(2,546)
Outstanding at period end (in shares)	6,638	12,802	70,628	112,094
Weighted-Average Exercise Price
Outstanding at period start, weighted-average exercise price (in dollars per share)	$ 30.97	$ 30.97	$ 30.32
Forfeited or expired, weighted-average exercise price (in dollars per share)	30.97	30.97	27.61
Exercised (in dollars per share)	30.97	30.97	29.30
Outstanding at period end, weighted-average exercise price (in dollars per share)	$ 30.97	$ 30.97	$ 30.97	$ 30.32
Weighted-Average Remaining Contractual Terms (in Years)
Weighted-average remaining contractual terms (in years)	1 year 3 months 18 days	1 year 7 months 6 days	1 year 2 months 12 days	1 year 9 months 18 days
Vesting period (in years)	3 years
Stock-based compensation expense	$ 0	$ 0	$ 0

STOCKHOLDERS' EQUITY - Restricted Stock (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Restricted Stock
Vested (in shares)		(43,397)	(4,444)
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized
Stock-based compensation	$ 5,842	$ 6,196	$ 2,603
Restricted stock
Restricted Stock
Outstanding at period start (in shares)	436,730	318,002	177,293
Granted (in shares)	114,256	164,010	154,769
Forfeited (in shares)	(6,354)	(1,885)	(9,616)
Vested (in shares)	(176,186)
Outstanding at period end (in shares)	368,446	436,730	318,002	177,293
Restricted stock exercisable (in shares)	0
Weighted-Average Remaining Contractual Terms (in Years)
Weighted-average remaining contractual terms (in years)	1 year 1 month 6 days	1 year 1 month 6 days	1 year 8 months 12 days	2 years 2 months 12 days
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized
Unrecognized compensation expense	$ 7,075
Unrecognized compensation expense, weighted average period of recognition	1 year 1 month 6 days
Stock-based compensation expense	$ 5,842	$ 6,196	$ 2,603
Restricted stock \| Executive Officer
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized
Stock-based compensation	$ 1,542

STOCKHOLDERS' EQUITY - Warrants (Details) - USD ($)	12 Months Ended
STOCKHOLDERS' EQUITY - Warrants (Details) - USD ($)	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2018
Class of Warrant or Right
Warrants outstanding (in shares)	0	0	404	6,790
Warrants forfeited or expired (in shares)	0	(404)	(6,386)
Warrants exercise price (in dollars per share)			$ 30.97	$ 27.81
Forfeited or expired, weighted average exercise price (in dollars per share)		$ 30.97	$ 27.61
Term of warrants (in years)	10 years
Number of warrants exercised (in shares)	0	0	0
Fair value assigned to warrants	$ 0	$ 0	$ 0
Minimum
Class of Warrant or Right
Warrants exercise price (in dollars per share)	$ 27.61
Maximum
Class of Warrant or Right
Warrants exercise price (in dollars per share)	$ 30.97

NET LOSS PER SHARE - Reconciliation of basic and diluted net loss per share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2021	Sep. 30, 2021	Jun. 30, 2021	Mar. 31, 2021	Dec. 31, 2020	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Earnings Per Share [Abstract]
Net loss from continuing operations									$ (16,260)	$ (32,944)	$ (12,685)
Net loss from discontinued operations									0	0	(1,046)
Net loss									$ (16,260)	$ (32,944)	$ (13,731)
Weighted average number of shares - basic (in shares)									19,268,255	18,056,828	14,624,194
Weighted average number of shares - diluted (in shares)									19,268,255	18,056,828	14,624,194
Net loss from continuing operations per share - basic (in dollars per share)									$ (0.84)	$ (1.82)	$ (0.87)
Net loss from continuing operations per share - diluted (in dollars per share)									(0.84)	(1.82)	(0.87)
Net loss from discontinued operations per share - diluted (in dollars per share)									0	0	(0.07)
Net loss from discontinued operations per share - basic (in dollars per share)									0	0	(0.07)
Net loss per share - basic (in dollars per share)	$ 0	$ (0.11)	$ (0.19)	$ (0.54)	$ (0.73)	$ (0.24)	$ (0.54)	$ (0.30)	(0.84)	(1.82)	(0.94)
Net loss per share - diluted (in dollars per share)	$ 0	$ (0.11)	$ (0.19)	$ (0.54)	$ (0.73)	$ (0.24)	$ (0.54)	$ (0.30)	$ (0.84)	$ (1.82)	$ (0.94)

NET LOSS PER SHARE - Antidilutive Securities (Details) - shares	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Antidilutive Securities Excluded from Computation of Earnings Per Share
Antidilutive securities excluded from computation of earnings per share (in shares)	375,084	449,532	389,034
Restricted stock
Antidilutive Securities Excluded from Computation of Earnings Per Share
Antidilutive securities excluded from computation of earnings per share (in shares)	368,446	436,730	318,002
Stock options
Antidilutive Securities Excluded from Computation of Earnings Per Share
Antidilutive securities excluded from computation of earnings per share (in shares)	6,638	12,802	70,628
Warrants
Antidilutive Securities Excluded from Computation of Earnings Per Share
Antidilutive securities excluded from computation of earnings per share (in shares)	0	0	404

BUSINESS SEGMENT - Narrative (Details)	12 Months Ended
BUSINESS SEGMENT - Narrative (Details)	Dec. 31, 2021 segment
Segment Reporting [Abstract]
Number of operating segments	1

BUSINESS SEGMENT - Schedule of Revenue by Geographical Location (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Revenues from External Customers and Long-Lived Assets
Net revenue	$ 98,049	$ 71,078	$ 72,552
U.S.
Revenues from External Customers and Long-Lived Assets
Net revenue	77,781	62,966	55,055
International
Revenues from External Customers and Long-Lived Assets
Net revenue	$ 20,268	$ 8,112	$ 17,497

- Definition

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).

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8736-108599

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 323
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-Paragraph 3
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-URI http://asc.fasb.org/extlink&oid=114001798&loc=d3e33918-111571

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 825
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+ Details

BUSINESS SEGMENT - Schedule of Revenue by Category (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2021	Sep. 30, 2021	Jun. 30, 2021	Mar. 31, 2021	Dec. 31, 2020	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Segment Reporting Information
Net revenue	$ 24,813	$ 25,079	$ 26,695	$ 21,462	$ 18,924	$ 22,205	$ 13,593	$ 16,356	$ 98,049	$ 71,078	$ 72,552
Trauma and deformity
Segment Reporting Information
Net revenue									65,829	47,677	49,371
Scoliosis
Segment Reporting Information
Net revenue									28,046	20,738	21,485
Sports medicine/other
Segment Reporting Information
Net revenue									$ 4,174	$ 2,663	$ 1,696

- Definition

+ References

+ Details

RELATED PARTY TRANSACTIONS (Details) $ in Thousands	12 Months Ended
RELATED PARTY TRANSACTIONS (Details) $ in Thousands	Dec. 31, 2021 USD ($) supplier	Dec. 31, 2020 USD ($)	Dec. 31, 2019 USD ($)
Related Party Transaction
Number of related party suppliers \| supplier	1
Disposed of by sale
Related Party Transaction
Divestiture purchase price		$ 25,000	$ 25,000
Affiliated Entity \| Structure Medical, LLC
Related Party Transaction
Payments to related party	$ 750	2,622	3,933
Affiliated Entity \| Vilex
Related Party Transaction
Payments to related party	702	2,900
Sales to related party	$ 224	$ 595
Affiliated Entity \| Vilex \| Disposed of by sale
Related Party Transaction
Divestiture purchase price			$ 25,000

- Definition

Amount of revenue, fees and commissions earned from transactions between (a) a parent company and its subsidiaries; (b) subsidiaries of a common parent; (c) an entity and trusts for the benefit of employees, for example, but not limited to, pension and profit-sharing trusts that are managed by or under the trusteeship of the entity's management; (d) an entity and its principal, owners, management, or members of their immediate families; and (e) affiliates.

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+ Details

EMPLOYEE BENEFIT PLAN (Details) - USD ($) $ in Thousands	12 Months Ended
EMPLOYEE BENEFIT PLAN (Details) - USD ($) $ in Thousands	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Retirement Benefits [Abstract]
Percentage of employees' contribution match (up to)		4.00%	3.00%
Employee contributions matched	$ 510	$ 439

COMMITMENTS AND CONTINGENCIES (Details) - USD ($)				1 Months Ended	12 Months Ended
COMMITMENTS AND CONTINGENCIES (Details) - USD ($)	Jul. 20, 2021	Mar. 19, 2021	Dec. 31, 2019	Jun. 30, 2019	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Long-term Purchase Commitment
Operating lease liability					$ 293,000
Operating Lease, Liability, Current, Statement of Financial Position					Other long-term liabilities	Other long-term liabilities
Operating Lease right-of-use asset					$ 297,000
Operating Lease, Right-of-Use Asset, Statement of Financial Position					kids:AssetsNoncurrentExcludingPropertyPlantAndEquipment	kids:AssetsNoncurrentExcludingPropertyPlantAndEquipment
Payments on note with affiliate					$ 0	$ 25,000,000	$ 0
Purchase commitment, remaining minimum amount committed					1,900,000
Cost of revenue					24,646,000	16,047,000	17,933,000
Legal settlement expenses					150,000	6,342,000	0
Minimum annual royalty payment					10,000
License agreements
Long-term Purchase Commitment
Payments to acquire intangible assets		$ 2,858,000
Intangible asset, useful life (in years)		8 years
License agreements \| FIREFLY Technology
Long-term Purchase Commitment
Payments to acquire intangible assets	$ 4,300,000
Finite lived intangible asset useful life extension period	5 years
Cost of revenue					$ 500,000
Legal settlement expenses						$ 0	$ 0
Squadron \| Team note B \| Affiliated Entity
Long-term Purchase Commitment
Payments on note with affiliate			$ 25,000,000
Vilex and Orthex
Long-term Purchase Commitment
Total consideration transferred				$ 60,000,000
Minimum
Long-term Purchase Commitment
Intangible asset, useful life (in years)					3 years
Royalty agreement percentage					0.50%
Maximum
Long-term Purchase Commitment
Intangible asset, useful life (in years)					20 years
Royalty agreement percentage					20.00%

QUARTERLY FINANCIAL INFORMATION (UNAUDITED) (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2021	Sep. 30, 2021	Jun. 30, 2021	Mar. 31, 2021	Dec. 31, 2020	Sep. 30, 2020	Jun. 30, 2020	Mar. 31, 2020	Dec. 31, 2021	Dec. 31, 2020	Dec. 31, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Net revenue	$ 24,813	$ 25,079	$ 26,695	$ 21,462	$ 18,924	$ 22,205	$ 13,593	$ 16,356	$ 98,049	$ 71,078	$ 72,552
Gross profit	18,081	18,554	20,443	16,325	15,118	17,639	10,061	12,213	73,403	55,031	54,619
Operating loss	(5,561)	(3,644)	(2,846)	(5,973)	(12,743)	(2,498)	(7,017)	(4,497)	(18,024)	(26,755)	(9,077)
Loss before income taxes	(166)	(2,489)	(4,042)	(10,691)	(14,736)	(4,539)	(9,447)	(4,945)	(17,388)	(33,667)	(12,685)
Provision for income taxes (benefit)	(238)	(292)	(286)	(312)	(723)	0	0	0	$ (1,128)	$ (723)	$ 0
Net loss	$ 72	$ (2,197)	$ (3,756)	$ (10,379)	$ (14,013)	$ (4,539)	$ (9,447)	$ (4,945)
Net loss per share - basic (in dollars per share)	$ 0	$ (0.11)	$ (0.19)	$ (0.54)	$ (0.73)	$ (0.24)	$ (0.54)	$ (0.30)	$ (0.84)	$ (1.82)	$ (0.94)
Net loss per share - diluted (in dollars per share)	$ 0	$ (0.11)	$ (0.19)	$ (0.54)	$ (0.73)	$ (0.24)	$ (0.54)	$ (0.30)	$ (0.84)	$ (1.82)	$ (0.94)
Revenue reduction to due repurchase of inventory	$ 2,730
Gross profit decrease due to revenue reduction									$ 1,115