Segment and Geographic Reporting (Notes)

12 Months Ended

Dec. 31, 2012

Segment Reporting [Abstract]

Segment and Geographic Reporting

SEGMENT AND GEOGRAPHIC REPORTING

The Company operates in one distinct line of business consisting of developing, manufacturing, marketing and distributing a proprietary excimer laser system and disposable products for the treatment of certain coronary and vascular conditions.

Within this line of business, the Company has identified two operating segments, which were identified on a geographic basis: (1) U.S. Medical and (2) International Medical. U.S. Medical and International Medical offer the same products and services but operate in different geographic regions, have different distribution networks and different regulatory environments. Within U.S. Medical, the Company aggregates its two product lines, Vascular Intervention and Lead Management, based on their similar economic, operational and regulatory characteristics, consistent with the authoritative guidance on segment reporting.

Additional information regarding each operating segment is discussed below.

(a) U.S. Medical

Products offered by this segment include single-use medical devices used in minimally invasive procedures within the cardiovascular system, including fiber-optic devices and non-fiber-optic products (disposables), an excimer laser system (equipment), and the service of the excimer laser system (service). The Company is subject to product approvals from the FDA. At December 31, 2012, FDA-approved products were used in multiple vascular procedures, including coronary and peripheral atherectomy, aspiration and thrombectomy and the removal of cardiac lead wires from patients with pacemakers and cardiac defibrillators. This segment’s customers are primarily located in the United States and Canada.

U.S. Medical is also corporate headquarters for the Company. All manufacturing, research and development as well as corporate administrative functions are performed within this reportable segment. As of December 31, 2012, 2011 and 2010, a portion of research, development and other technology expenses and general and administrative expenses incurred in the U.S. has been allocated to International Medical based on a percentage of revenue because these expenses support the Company’s ability to generate revenue within the International Medical segment.

Manufacturing activities are performed entirely within the U.S. Medical segment. Revenue associated with intersegment product transfers to International Medical was $7.5 million, $6.5 million and $4.2 million for the years ended December 31, 2012, 2011 and 2010, respectively. Revenue is based upon transfer prices, which provide for intersegment profit that is eliminated upon consolidation.

(b) International Medical

The International Medical segment headquarters is located in the Netherlands, and serves Europe as well as the Middle East, Latin America (including Puerto Rico), Japan and the Pacific Rim. Products offered by this segment are substantially the same as those offered by U.S. Medical.  The International Medical segment is engaged primarily in distribution activities, with no manufacturing or product development functions. Certain U.S. incurred research, development and other technology expenses and general and administrative expenses have been allocated to International Medical based on a percentage of revenue because these expenses support the Company’s ability to generate revenue within the International Medical segment.

Summary financial information relating to reportable segment operations is shown below. Intersegment transfers as well as intercompany assets and liabilities are excluded from the information provided (in thousands):

	2012		2011		2010
Revenue:
U.S. Medical:
Disposable products	$	103,218	$	90,849	$	87,070
Service and other, net of allowance for sales returns	9,081		8,719		8,215
Equipment	5,137		6,365		5,723
Subtotal	117,436		105,933		101,008
International Medical:
Disposable products	19,304		17,895		14,316
Service and other, net of allowance for sales returns	1,358		1,403		1,165
Equipment	2,187		2,056		1,428
Subtotal	22,849		21,354		16,909
Total revenue	$	140,285	$	127,287	$	117,917

	U.S. Medical		International Medical		Total
2012
Interest income	$	70	$	1	$	71
Interest expense	63		—		63
Depreciation and amortization expense	8,705		1,178		9,883
Income tax expense	414		320		734
Segment operating income	1,037		1,910		2,947
Segment net income	656		1,570		2,226
Capital expenditures	3,063		16		3,079
Segment assets	$	95,181	$	15,588	$	110,769

	U.S. Medical		International Medical			Total
2011
Interest income	$	139	$	2		$	141
Interest expense	59		231			290
Depreciation and amortization expense	8,801		1,161			9,962
Income tax expense (benefit)	431		(200		)	231
Segment operating income	647		639			1,286
Segment net income	347		547			894
Capital expenditures	2,480		181			2,661
Segment assets	$	92,446	$	16,590		$	109,036

	U.S. Medical			International Medical			Total
2010
Interest income	$	232		$	3		$	235
Interest expense	12			—			12
Depreciation and amortization expense	9,009			954			9,963
Income tax expense	5,055			1,177			6,232
Segment operating loss	(7,006		)	(40		)	(7,046		)
Segment net loss	(11,853		)	(1,210		)	(13,063		)
Capital expenditures	3,664			213			3,877
Segment assets	$	83,262		$	10,433		$	93,695

In 2012, 2011 and 2010, no individual customer represented 10% or more of consolidated revenue. There were no individual countries, other than the United States, that represented at least 10% of consolidated revenue in 2012, 2011 or 2010. Long-lived assets, other than financial instruments and deferred tax assets, located in foreign countries are concentrated in Europe, and totaled $10.6 million and $8.4 million as of December 31, 2012 and 2011, respectively.

Revenue by Product Line

	For the years ended December 31,
(in thousands)	2012		2011		2010
Revenue
Disposable products revenue:
Vascular intervention	$	67,336	$	62,264	$	60,224
Lead management	55,186		46,480		41,162
Total disposable products revenue	122,522		108,744		101,386
Service and other, net of allowance for sales returns	10,439		10,122		9,380
Equipment	7,324		8,421		7,151
Total revenue	140,285		127,287		117,917