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Document and Entity Information - shares	9 Months Ended
Document and Entity Information - shares	Sep. 30, 2012	Oct. 31, 2012
Document and Entity Information [Abstract]
Entity Registrant Name	EnteroMedics Inc
Entity Central Index Key	0001371217
Document Type	10-Q
Document Period End Date	Sep. 30, 2012
Amendment Flag	false
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	Q3
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		41,701,594

Condensed Consolidated Balance Sheets (Unaudited) - USD ($)	Sep. 30, 2012	Dec. 31, 2011
Current assets:
Cash and cash equivalents	$ 27,214,739	$ 28,487,688
Restricted cash	200,000	200,000
Short-term investments available for sale	0	1,005,411
Accounts receivable	52,649
Inventory	1,611,339	1,068,623
Prepaid expenses and other current assets	558,419	804,799
Total current assets	29,637,146	31,566,521
Property and equipment, net	629,811	630,354
Other assets	456,494	288,980
Total assets	30,723,451	32,485,855
Current liabilities:
Current portion of notes payable	2,000,000	2,307,162
Accounts payable	292,690	434,436
Accrued expenses	3,470,524	6,373,370
Accrued interest payable	515,051	448,821
Total current liabilities	6,278,265	9,563,789
Notes payable, less current portion (net discounts of $366,598 and $216,711 at September 30, 2012 and December 31, 2011, respectively)	7,633,402	2,881,161
Total liabilities	13,911,667	12,444,950
Commitments and contingencies (note 3)
Stockholders' equity:
Common stock, $0.01 par value; 125,000,000 shares authorized; 41,560,615 and 36,752,746 shares issued and outstanding at September 30, 2012 and December 31, 2011, respectively	415,606	367,527
Additional paid-in capital	209,541,873	196,384,995
Accumulated other comprehensive income		692
Deficit accumulated during development stage	(193,145,695)	(176,712,309)
Total stockholders' equity	16,811,784	20,040,905
Total liabilities and stockholders' equity	$ 30,723,451	$ 32,485,855

Condensed Consolidated Balance Sheets (Parenthetical) (Unaudited) - USD ($)	Sep. 30, 2012	Dec. 31, 2011
Condensed Consolidated Balance Sheets [Abstract]
Notes payable, less current portion, discounts	$ 366,598	$ 216,711
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	125,000,000	125,000,000
Common stock, shares issued	41,560,615	36,752,746
Common stock, shares outstanding	41,560,615	36,752,746

Condensed Consolidated Statements of Operations (Unaudited) - USD ($)	3 Months Ended		9 Months Ended		117 Months Ended
	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012
Condensed Consolidated Statements of Operations [Abstract]
Sales			$ 311,493		$ 311,493
Cost of goods sold			231,520		231,520
Gross profit			79,973		79,973
Operating expenses:
Research and development	$ 2,580,653	$ 4,778,967	7,521,177	$ 10,882,384	124,302,751
Selling, general and administrative	2,991,817	2,354,501	8,347,481	6,488,749	56,516,451
Total operating expenses	5,572,470	7,133,468	15,868,658	17,371,133	180,819,202
Operating loss	(5,572,470)	(7,133,468)	(15,788,685)	(17,371,133)	(180,739,229)
Other income (expense):
Interest income	3,193	2,303	7,353	10,634	4,043,616
Interest expense	(263,713)	(167,794)	(636,607)	(563,656)	(12,199,377)
Change in value of warrant liability					(3,840,622)
Other, net	(13,850)	847	(15,447)	(17,080)	(279,115)
Net loss	$ (5,846,840)	$ (7,298,112)	$ (16,433,386)	$ (17,941,235)	$ (193,014,727)
Net loss per share - basic and diluted	$ (0.14)	$ (0.26)	$ (0.42)	$ (0.64)
Shares used to compute basic and diluted net loss per share	40,984,216	28,209,522	38,810,762	27,999,412

Condensed Consolidated Statements of Comprehensive Loss (Unaudited) - USD ($)	3 Months Ended		9 Months Ended		117 Months Ended
	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012
Condensed Consolidated Statements of Comprehensive [Abstract]
Net loss	$ (5,846,840)	$ (7,298,112)	$ (16,433,386)	$ (17,941,235)	$ (193,014,727)
Change in unrealized gain (loss) on available for sale investments	(116)	(174)	(692)	(174)
Comprehensive loss	$ (5,846,956)	$ (7,298,286)	$ (16,434,078)	$ (17,941,409)	$ (193,014,727)

- Definition

The change in equity [net assets] of a business enterprise during a period from transactions and other events and circumstances from non-owner sources which are attributable to the reporting entity. It includes all changes in equity during a period except those resulting from investments by owners and distributions to owners, but excludes any and all transactions which are directly or indirectly attributable to that ownership interest in subsidiary equity which is not attributable to the parent.

+ References + Details

- Definition

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

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
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-Name Accounting Standards Codification
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Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 9: http://www.xbrl.org/2003/role/presentationRef
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-Name Accounting Research Bulletin (ARB)
-Number 51
-Paragraph 38
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-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 10: http://www.xbrl.org/2003/role/presentationRef
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Reference 11: http://www.xbrl.org/2003/role/presentationRef
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Reference 12: http://www.xbrl.org/2003/role/presentationRef
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-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 13: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
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Reference 14: http://www.xbrl.org/2003/role/presentationRef
-Publisher AICPA
-Name Accounting Research Bulletin (ARB)
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Reference 15: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
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Reference 16: http://www.xbrl.org/2003/role/presentationRef
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-Name Regulation S-X (SX)
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+ Details

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)	9 Months Ended		117 Months Ended
	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012
Cash flows from operating activities:
Net loss	$ (16,433,386)	$ (17,941,235)	$ (193,014,727)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation	177,587	223,590	2,437,625
Loss on sale of equipment	4,241	1,269	78,368
Stock-based compensation	2,739,319	2,092,058	17,202,485
Amortization of commitment fees, debt issuance costs and original issue discount	152,932	180,672	4,039,555
Amortization of short-term investment premium or discount	4,719	1,408	(300,071)
Change in value of warrant liability			3,840,622
Change in operating assets and liabilities:
Accounts receivable	(52,649)		(52,649)
Inventory	(542,716)		(1,611,339)
Prepaid expenses and other current assets	246,380	(279,825)	(558,419)
Other assets	(182,984)	50,824	(420,317)
Accounts payable	(271,228)	323,609	29,912
Accrued expenses	(2,902,846)	801,664	3,470,524
Accrued interest payable	66,230	23,438	680,873
Net cash used in operating activities	(16,994,401)	(14,522,528)	(164,177,558)
Cash flows from investing activities:
Decrease (increase) in restricted cash		6,327,031	(200,000)
Purchases of short-term investments available for sale		(5,007,980)	(19,890,213)
Maturities of short-term investments available for sale	1,000,000	2,000,000	19,854,414
Purchases of short-term investments held to maturity			(22,414,130)
Maturities of short-term investments held to maturity			22,750,000
Purchases of property and equipment	(51,803)	(239,044)	(2,883,025)
Net cash provided by (used in) investing activities	948,197	3,080,007	(2,782,954)
Cash flows from financing activities:
Proceeds from stock options exercised		2,164	203,018
Proceeds from warrants exercised	5,546,160	119,912	5,863,501
Proceeds from sale of common stock and warrants for purchase of common stock	5,050,000	14,520,000	119,404,439
Common stock financing costs	(367,871)	(1,234,300)	(9,846,301)
Payment to shareholders for fractional shares upon reverse stock split			(355)
Proceeds from sale of Series A, B and C convertible preferred stock			63,766,564
Series A, B and C convertible preferred stock financing costs			(1,658,662)
Proceeds from notes payable and convertible notes payable	5,347,807		47,993,774
Repayments on notes payable	(752,841)	(367,188)	(31,178,928)
Debt issuance costs	(50,000)		(371,799)
Net cash provided by financing activities	14,773,255	13,040,588	194,175,251
Net (decrease) increase in cash and cash equivalents	(1,272,949)	1,598,067	27,214,739
Cash and cash equivalents:
Beginning of period	28,487,688	30,840,560
End of period	27,214,739	32,438,627	27,214,739
Supplemental disclosure:
Interest paid	417,445	$ 359,505	7,470,345
Noncash investing and financing activities:
Cancellation of Alpha Medical, Inc. Series A convertible preferred stock and common stock			(661,674)
Issuance of Beta Medical, Inc. Series A convertible preferred stock in exchange for Alpha Medical, Inc. Series A convertible preferred stock and common stock			661,674
Value of warrants issued with debt for debt commitment	$ 237,349		4,070,532
Value of warrants issued with sale of common and preferred stock offerings			1,684,832
Cashless exercise of warrants			5,244,778
Conversion of notes and interest payable to Series B and C convertible preferred shares			6,980,668
Options issued for deferred compensation			10,898
Common stock issued to Mayo Foundation and for deferred compensation			1,770,904
Reclassification of warrant liability			2,932,766
Conversion of convertible preferred stock to common stock			$ 51,132

Summary of Significant Accounting Policies

9 Months Ended

Sep. 30, 2012

Summary of Significant Accounting Policies [Abstract]

Summary of Significant Accounting Policies

(1) Summary of Significant Accounting Policies

Description of Business

EnteroMedics Inc. (formerly Beta Medical, Inc.) (the Company) is developing medical devices using neuroblocking technology to treat obesity, metabolic diseases and other gastrointestinal disorders. The Company was incorporated in the state of Minnesota on December 19, 2002 and was reincorporated in Delaware on July 22, 2004. The Company is in the development stage and since inception has devoted substantially all of its resources to recruiting personnel, developing its product technology, obtaining patents to protect its intellectual property and raising capital, and only recently has derived revenues from its primary business activity. The Company is headquartered in St. Paul, Minnesota. In January 2006, the Company established EnteroMedics Europe Sárl, a wholly-owned subsidiary located in Switzerland.

Since inception, the Company has incurred losses through September 30, 2012 totaling approximately $193.0 million and has not generated positive cash flows from operations. The Company expects such losses to continue into the foreseeable future as it continues to develop and commercialize its technologies. The Company may need to obtain additional financing and there can be no assurance that the Company will be successful in obtaining additional financing on favorable terms, or at all. If adequate funds are not available, the Company may have to delay development or commercialization of products or license to third parties the rights to commercialize products or technologies that the Company would otherwise seek to commercialize.

Basis of Presentation

The Company has prepared the accompanying condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America. The Company’s fiscal year ends on December 31.

The accompanying condensed consolidated financial statements and notes thereto are unaudited. In the opinion of the Company’s management, these statements include all adjustments, which are of a normal recurring nature, necessary to present a fair presentation. Interim results are not necessarily indicative of results for a full year. The condensed consolidated balance sheet as of December 31, 2011 was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. The information included in this Form 10-Q should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2011.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

Principles of Consolidation

The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary. All significant intercompany balances and transactions have been eliminated in consolidation.

Fair Value of Financial Instruments

Carrying amounts of certain of the Company’s financial instruments, including cash and cash equivalents, restricted cash, prepaid expenses and other current assets, accounts payable and accrued liabilities approximate fair value due to their short maturities. The fair value of the Company’s long-term debt is approximately $9.9 million as of September 30, 2012 based on the present value of estimated future cash flows using a discount rate commensurate with borrowing rates available to the Company. If measured at fair value in the condensed consolidated financial statements, long-term debt (including the current portion) would be classified as Level 2 in the fair value hierarchy.

The Company’s assets that are measured at fair value on a recurring basis are classified within Level 1 or Level 2 of the fair value hierarchy. The Company does not hold any assets that are measured at fair value using Level 3 inputs. The types of instruments the Company invests in that are valued based on quoted market prices in active markets include U.S. treasury securities. Such instruments are classified by the Company within Level 1 of the fair value hierarchy. U.S. treasuries are valued using unadjusted quoted prices for identical assets in active markets that the Company can access.

The types of instruments the Company invests in that are valued based on quoted prices in less active markets, broker or dealer quotations, or alternative pricing sources with reasonable levels of price transparency include U.S. agency securities, commercial paper, U.S. corporate bonds and municipal obligations. Such instruments are classified by the Company within Level 2 of the fair value hierarchy. The Company values these types of assets using consensus pricing or a weighted average price, which is based on multiple pricing sources received from a variety of industry standard data providers (e.g. Bloomberg), security master files from large financial institutions, and other third-party sources. The multiple prices obtained are then used as inputs into a distribution-curve-based algorithm to determine the daily market price.

The Company did not hold any short-term investments as of September 30, 2012.

Restricted Cash

The Company had $200,000 in a cash collateral money market account as of September 30, 2012 and December 31, 2011. Pursuant to the Lease Agreement the Company entered into with Roseville Properties Management Company in July 2008, the Company was required to deliver to Roseville Properties an irrevocable, unconditional, standby letter of credit in the amount of $200,000 on the second anniversary of the commencement of lease payments. The standby letter of credit is to be maintained through October 1, 2013. The irrevocable standby letter of credit was issued by Silicon Valley Bank, who required the Company to set up a restricted cash collateral money market account to fully secure the standby letter of credit.

Inventory

The Company accounts for inventory at the lower of cost or market and records any long-term inventory as other assets in the condensed consolidated balance sheets.

Comprehensive Loss

Comprehensive loss is defined as the change in equity of a company during a period from transactions and other events and circumstances excluding transactions resulting from investment owners and distributions to owners. The difference from reported net loss for the three and nine months ended September 30, 2012 and 2011 related entirely to changes in unrealized gains (losses) on available for sale investments.

Revenue Recognition

The Company recognizes revenue when persuasive evidence of an arrangement exists, title or risk of loss has passed, the selling price is fixed or determinable and collection is reasonably assured. The Company sells products internationally through distributors and recognizes revenue upon sale to the distributor as these sales are considered to be final and no right of return or price protection exists. Terms of sales to international distributors are generally EXW, reflecting that goods are shipped “ex works,” in which risk of loss is assumed by the distributor at the shipping point. The Company does not provide for rights of return to customers on product sales and therefore does not record a provision for returns.

Research and Development Expenses

Research and development expenses are charged to expense as incurred. Research and development expenses include, but are not limited to, product development, clinical trial expenses, including supplies and devices, regulatory expenses, payroll and other personnel expenses, materials and consulting costs.

Derivative Instruments

The Company accounts for outstanding warrants that are not indexed to the Company’s stock or warrants issued when the Company has insufficient authorized and unissued stock available to share settle the outstanding warrants as derivative instruments, which require that the warrants be classified as a liability and measured at fair value with changes in fair value recognized currently in earnings and recorded separately in the condensed consolidated statements of operations.

Net Loss Per Share

Basic net loss per share is computed by dividing net loss by the weighted-average number of common shares outstanding during the period. Diluted net loss per share is based on the weighted-average common shares outstanding during the period plus dilutive potential common shares calculated using the treasury stock method. Such potentially dilutive shares are excluded when the effect would be to reduce a net loss per share. The Company’s potential dilutive shares, which include outstanding common stock options, unvested common shares subject to repurchase and warrants, have not been included in the computation of diluted net loss per share for all periods as the result would be anti-dilutive.

The following table sets forth the computation of basic and diluted net loss per share for the three and nine months ended September 30, 2012 and 2011:


	Three months ended September 30,						Nine months ended September 30,
	2012			2011			2012			2011
Numerator:
Net loss	$	(5,846,840	)	$	(7,298,112	)	$	(16,433,386	)	$	(17,941,235	)

Denominator for basic and diluted net loss per share:
Weighted-average common shares outstanding		40,984,216			28,209,522			38,810,762			27,999,412
Weighted-average unvested common shares subject to repurchase		—			—			—			—

Denominator for net loss per common share—basic and diluted		40,984,216			28,209,522			38,810,762			27,999,412

Net loss per share—basic and diluted	$	(0.14	)	$	(0.26	)	$	(0.42	)	$	(0.64	)

The following table sets forth the potential shares of common stock that are not included in the calculation of diluted net loss per share because to do so would be anti-dilutive as of the end of each period presented:


	September 30,
	2012		2011
Stock options outstanding		7,879,730		2,799,908
Warrants to purchase common stock		21,493,883		23,927,766

Recently Issued Accounting Standards

In June 2011, the Financial Accounting Standards Board issued guidance on the presentation of comprehensive income in financial statements. Entities are required to present total comprehensive income either in a single, continuous statement of comprehensive income or in two separate, but consecutive, statements. The Company adopted this standard during the first quarter of 2012 and presents net loss and other comprehensive loss in two separate, but consecutive, statements. The adoption of this standard did not have a material effect on the Company’s financial statement disclosures.

There have been no other significant changes in recent accounting pronouncements during the nine months ended September 30, 2012 as compared to the recent accounting pronouncements described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2011.

Inventory

9 Months Ended

Sep. 30, 2012

Inventory [Abstract]

Inventory

(2) Inventory

From inception until December 2011, inventory related purchases had been used for research and development related activities and had accordingly been expensed as incurred. In December 2011, the Company began receiving Australian Register of Therapeutic Goods (ARTG) listings for components of the Maestro Rechargeable System from the Australian Therapeutic Goods Administration (TGA), with the final components being listed on the ARTG in January 2012. As a result, the Company determined certain assets were recoverable as inventory beginning in December 2011. The Company accounts for inventory at the lower of cost or market and records any long-term inventory as other assets in the condensed consolidated balance sheets. There was approximately $373,000 and $228,000 of long-term inventory as of September 30, 2012 and December 31, 2011, respectively.

Current inventory consists of the following as of:


	September 30, 2012		December 31, 2011
Raw materials	$	361,539	$	376,580
Work-in-process		1,221,434		692,043
Finished goods		28,366		—

Inventory	$	1,611,339	$	1,068,623

Commitments and Contingencies

9 Months Ended

Sep. 30, 2012

Commitments and Contingencies [Abstract]

Commitments and Contingencies

(3) Commitments and Contingencies

The Company rents its office, warehouse and laboratory facilities under an operating lease, which expires on September 30, 2015. At September 30, 2012, future minimum payments under the lease are as follows:


Years ending December 31:
Remaining three months in 2012	$	71,058
2013		285,656
2014		291,369
2015		221,789

	$	869,872

The Company is exposed to product liability claims that are inherent in the testing, production, marketing and sale of medical devices. Management believes any losses that may occur from these matters are adequately covered by insurance, and the ultimate outcome of these matters will not have a material effect on the Company’s financial position or results of operations. The Company is not currently a party to any litigation and is not aware of any pending or threatened litigation that could have a material adverse effect on the Company’s business, operating results or financial condition.

- Definition

The entire disclosure for commitments and contingencies.

+ References

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-Publisher FASB
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-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

+ Details

Notes Payable

9 Months Ended

Sep. 30, 2012

Notes Payable [Abstract]

Notes Payable

(4) Notes Payable

On November 18, 2008 the Company entered into a Loan and Security Agreement (the Prior Loan Agreement) with Silicon Valley Bank (SVB), Venture Lending & Leasing V, Inc. (a private equity fund under the management of Western Technology Investment (WTI)) and Compass Horizon Funding Company LLC (Horizon and, collectively with SVB and WTI, the Lenders), in an aggregate principal amount of up to $20.0 million. On November 21, 2008, SVB and WTI each funded a term loan in the aggregate principal amount of $10.0 million and $5.0 million, respectively. The additional $5.0 million term loan was automatically funded by Horizon on April 28, 2009 when the trading price of the Company’s common stock on the NASDAQ Global Market exceeded a target amount specified in the Prior Loan Agreement. On December 1, 2009, the Company repaid the outstanding principal amount due to WTI and Horizon pursuant to the Prior Loan Agreement.

During 2010 and 2011, the Company and SVB entered into four amendments to the Prior Loan Agreement, which modified the payment terms, annual interest rate and financial covenants. A brief summary of the four amendments is provided below.

On February 8, 2010, the Company and SVB entered into the First Amendment to the Prior Loan Agreement, which reduced the annual interest rate from 11.0% to a fixed annual rate of 10.0%, payable monthly, revised the liquidity financial covenant and added a New Capital Transaction covenant.

On July 8, 2010, the Company and SVB entered into a Second Amendment to the Prior Loan Agreement, which modified the repayment terms of the loan such that interest only payments were required through December 31, 2010 followed by 30 equal payments of principal and interest, increased the annual interest rate from 10.0% to a fixed annual rate of 11.0%, payable monthly, revised the liquidity financial covenant and added additional New Capital Transaction requirements. On July 8, 2010, per the terms of the Second Amendment to the Prior Loan Agreement, SVB was issued a warrant to purchase 150,642 shares of the Company’s common stock with an exercise price of $2.10 per share.

On November 4, 2010, the Company and SVB entered into a Third Amendment (the Third Amendment) to the Prior Loan Agreement, which modified the New Capital Transaction covenant, suspended the liquidity financial covenant and required the Company to maintain a blocked cash collateral account with funds equal to the principal balance outstanding.

On March 3, 2011, the Company entered into a Fourth Amendment (the Fourth Amendment) to the Prior Loan Agreement with SVB. The Fourth Amendment modified the repayment terms of the term loan such that beginning April 1, 2011 through September 30, 2011, the Company was required to make interest only monthly payments on the term loan. Then, beginning on October 1, 2011, the remaining balance due on the term loan started to amortize over 30 equal payments of principal and interest, payable monthly. In addition, the Fourth Amendment amended the interest rate due effective March 1, 2011 on the remaining principal amount of the term loan from 11.0% to a fixed annual rate of 6.25%, payable monthly. The Fourth Amendment reinstated the liquidity financial covenant and eliminated SVB’s springing lien on the Company’s intellectual property, the New Capital Transactions requirement and the requirement of the Third Amendment to maintain a blocked cash collateral account with funds equal to the principal balance outstanding.

On April 16, 2012, the Company entered into a new Loan and Security Agreement (the Loan Agreement) with SVB, pursuant to which SVB agreed to make term loans to the Company in an aggregate principal amount of up to $20.0 million ($10.0 million of which has not and may not be funded unless the Company meets the primary endpoints of the ReCharge trial as well as certain financial objectives for 2012 prior to February 15, 2013), on the terms and conditions set forth in the Loan Agreement. The Loan Agreement amends and restates the Prior Loan Agreement, as amended.

Pursuant to the Loan Agreement, a term loan was funded in the aggregate principal amount of $10.0 million on April 23, 2012, a portion of which was used to repay in full the outstanding debt of approximately $4.7 million. The term loan requires interest only payments monthly through March 31, 2013 followed by 30 equal payments of principal in the amount of $333,333 plus accrued interest beginning on April 1, 2013 and ending on September 1, 2015, payable monthly. Amounts borrowed under the Loan Agreement bear interest at a fixed annual rate equal to 8.0%. The final payment fee from the Prior Loan Agreement will be due on September 1, 2015. The Company may voluntarily prepay the term loan in full, but not in part, and any voluntary or mandatory prepayment is subject to applicable prepayment premiums and will also include the final payment fee. The Company is required to comply with certain financial covenants that require the Company to generate certain minimum amounts of revenue from the sale of its Maestro System and to implant certain minimum numbers of Maestro Systems during cumulative quarterly measurement periods beginning with the period ended March 31, 2013 and ending with the period ended June 30, 2015. If the Company fails to meet the financial covenants, the term loan will be in default.

The Company has granted SVB a security interest in all of the Company’s assets, excluding intellectual property except with respect to all license, royalty fees and other revenues and income arising out of or relating to any of the intellectual property and all proceeds of the intellectual property. The Company also has entered into a negative pledge arrangement with SVB pursuant to which it has agreed not to encumber any of its intellectual property without SVB’s prior written consent. If the Company does not meet the primary endpoints of the ReCharge trial or does not fully disclose the results of the trial to the public prior to February 15, 2013, it will be required to place the lesser of $7.5 million or the outstanding principal balance in a restricted account at SVB.

Pursuant to the Loan Agreement, on April 16, 2012, the Company issued SVB a warrant to purchase 106,746 shares of common stock, exercisable for ten years from the date of grant, at an exercise price of $2.34 per share.

Scheduled debt principal payments are as follows as of September 30, 2012:


Years Ending December 31:
Remaining three months in 2012	$	—
2013		3,000,000
2014		4,000,000
2015		3,000,000

		10,000,000
Less: Original issue discount		(366,598	)

Notes payable, net	$	9,633,402

- 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 + Details

Stock-based Compensation

9 Months Ended

Sep. 30, 2012

Stock-based Compensation [Abstract]

Stock-Based Compensation

(5) Stock-based Compensation

The fair value method of accounting for share-based payments is applied to all share-based payment awards issued to employees and where appropriate, nonemployees, unless another source of literature applies. When determining the measurement date of a nonemployee’s share-based payment award, the Company measures the stock options at fair value and remeasures such stock options to the current fair value until the performance date has been reached.

Based on the application of these standards, stock-based compensation expense for stock-based awards under the Company’s Amended and Restated 2003 Stock Incentive Plan for the three and nine months ended September 30, 2012 and 2011 was allocated to operating expenses and employees and nonemployees as follows:


	Three months ended September 30,				Nine months ended September 30,
	2012		2011		2012		2011
Research and development	$	319,964	$	208,942	$	606,994	$	680,431
Selling, general and administrative		1,008,747		488,821		2,132,325		1,411,627

Total	$	1,328,711	$	697,763	$	2,739,319	$	2,092,058


	Three months ended September 30,				Nine months ended September 30,
	2012		2011		2012		2011
Employees	$	1,326,311	$	682,733	$	2,687,253	$	2,060,581
Nonemployees		2,400		15,030		52,066		31,477

Total	$	1,328,711	$	697,763	$	2,739,319	$	2,092,058

As of September 30, 2012 there was approximately $17.5 million of total unrecognized compensation costs, net of estimated forfeitures, related to employee unvested stock option awards granted after January 1, 2006, which are expected to be recognized over a weighted-average period of 3.45 years.

The estimated grant-date fair values of the stock options were calculated using the Black-Scholes valuation model, based on the following assumptions for the three and nine months ended September 30, 2012 and 2011:


	Employees						Employees
	Three months ended September 30,						Nine months ended September 30,
	2012			2011			2012			2011
Risk-free interest rates		0.90%-0.97	%		1.20%-2.16	%		0.90%-1.09	%		1.20%-2.68	%
Expected life		6.25 years			6.25 years			6.00-6.25 years			5.42-6.25 years
Expected dividends		0	%		0	%		0	%		0	%
Expected volatility		137.58%-138.38	%		116.75%-119.35	%		123.18%-141.05	%		116.75%-124.40	%


	Nonemployees						Nonemployees
	Three months ended September 30,						Nine months ended September 30,
	2012			2011			2012			2011
Risk-free interest rates		0.33	%		0.66%-1.91	%		0.24%-2.05	%		0.66%-3.45	%
Expected life		2.76 years			3.75-9.95 years			2.00-9.25 years			3.75-9.95 years
Expected dividends		0	%		0	%		0	%		0	%
Expected volatility		80.13	%		116.40%-120.50	%		80.13%-139.80	%		116.40%-123.80	%

Option activity under the Company’s Amended and Restated 2003 Stock Incentive Plan for the nine months ended September 30, 2012 was as follows:


	Shares Available For Grant			Outstanding Options
	Shares Available For Grant			Number of Shares			Weighted-Average Exercise Price
Balance, December 31, 2011		763,829			3,470,908		$	3.17
Shares reserved		8,000,000			—			—
Options granted		(4,462,873	)		4,462,873			3.35
Options exercised		—			—			—
Options cancelled		54,051			(54,051	)		2.28

Balance, September 30, 2012		4,355,007			7,879,730			3.28

- Definition

The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 50
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=6406099&loc=d3e25284-112666

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 718
-SubTopic 40
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=6418621&loc=d3e17540-113929

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 718
-SubTopic 10
-Section 50
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=6415400&loc=d3e5070-113901

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 718
-SubTopic 10
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=6415400&loc=d3e5047-113901

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 718
-SubTopic 10
-Section 50
-Paragraph 4
-URI http://asc.fasb.org/extlink&oid=6415400&loc=d3e5444-113901

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Staff Accounting Bulletin (SAB)
-Number Topic 14

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 123R
-Paragraph 64, 65, A240
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher AICPA
-Name Statement of Position (SOP)
-Number 93-6
-Paragraph 53
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

+ Details

Stock Sales

9 Months Ended

Sep. 30, 2012

Stock Sales [Abstract]

Stock Sales

(6) Stock Sales

On April 16, 2012, the Company entered into a securities purchase agreement with a current investor for the sale of 2,271,705 shares of its common stock in a registered direct offering, at a purchase price of $2.223 per share. On April 20, 2012, the offering closed and the Company received gross proceeds of $5.0 million before deducting estimated offering expenses.

Subsequent Events

9 Months Ended

Sep. 30, 2012

Subsequent Events [Abstract]

Subsequent Events

(7) Subsequent Events

On October 4, 2012, the Company entered into a Common Stock Purchase Agreement (the Purchase Agreement) with Terrapin Opportunity, L.P. (Terrapin) pursuant to which the Company may sell up to the lesser of $45.0 million of its common stock or 8,312,122 shares of its common stock over an approximately 24-month period pursuant to the terms of the Purchase Agreement. The Company is not obligated to utilize any portion of the facility and generally remains free to enter into and consummate other equity and debt financing transactions.

The Company will determine, at its sole discretion, the timing, the dollar amount and the price per share of each draw under this facility, subject to certain conditions. When and if the Company elects to utilize the facility by delivery of a draw down notice to Terrapin, the Company will issue shares to Terrapin at a discount ranging from 4.00% to 6.80% to the volume weighted average price of the Company’s common stock over a preceding period of trading days (a Draw Down Period). The Purchase Agreement also provides that from time to time, at the Company’s sole discretion, it may grant Terrapin an option to purchase additional shares of the Company’s common stock during each Draw Down Period for an amount of shares specified by the Company based on the trading price of its common stock. Upon Terrapin’s exercise of such an option, the Company will sell to Terrapin the shares subject to the option at a price equal to the greater of (i) the daily volume weighted average price of the Company’s common stock on the day Terrapin notifies the Company of its election to exercise its option or (ii) the threshold price for the option determined by the Company, in each case less a discount ranging from 4.00% to 6.80%.

Terrapin is not required to purchase any shares at a pre-discounted purchase price below $1.25 per share, or any shares that would cause it to hold over 9.9% of the Company’s common stock. Any shares sold under this facility will be sold pursuant to a shelf registration statement declared effective by the U.S. Securities and Exchange Commission on August 29, 2012. Subject to earlier termination under certain conditions, the Purchase Agreement will terminate on November 1, 2014.

Summary of Significant Accounting Policies (Policies)	9 Months Ended
Summary of Significant Accounting Policies (Policies)	Sep. 30, 2012
Summary of Significant Accounting Policies [Abstract]
Description of Business	*Description of Business* EnteroMedics Inc. (formerly Beta Medical, Inc.) (the Company) is developing medical devices using neuroblocking technology to treat obesity, metabolic diseases and other gastrointestinal disorders. The Company was incorporated in the state of Minnesota on December 19, 2002 and was reincorporated in Delaware on July 22, 2004. The Company is in the development stage and since inception has devoted substantially all of its resources to recruiting personnel, developing its product technology, obtaining patents to protect its intellectual property and raising capital, and only recently has derived revenues from its primary business activity. The Company is headquartered in St. Paul, Minnesota. In January 2006, the Company established EnteroMedics Europe Sárl, a wholly-owned subsidiary located in Switzerland. Since inception, the Company has incurred losses through September 30, 2012 totaling approximately $193.0 million and has not generated positive cash flows from operations. The Company expects such losses to continue into the foreseeable future as it continues to develop and commercialize its technologies. The Company may need to obtain additional financing and there can be no assurance that the Company will be successful in obtaining additional financing on favorable terms, or at all. If adequate funds are not available, the Company may have to delay development or commercialization of products or license to third parties the rights to commercialize products or technologies that the Company would otherwise seek to commercialize.
Basis of Presentation	*Basis of Presentation* The Company has prepared the accompanying condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America. The Company’s fiscal year ends on December 31. The accompanying condensed consolidated financial statements and notes thereto are unaudited. In the opinion of the Company’s management, these statements include all adjustments, which are of a normal recurring nature, necessary to present a fair presentation. Interim results are not necessarily indicative of results for a full year. The condensed consolidated balance sheet as of December 31, 2011 was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. The information included in this Form 10-Q should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2011.
Use of Estimates	*Use of Estimates* The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.
Principles of Consolidation	*Principles of Consolidation* The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary. All significant intercompany balances and transactions have been eliminated in consolidation.
Fair Value of Financial Instruments	*Fair Value of Financial Instruments* Carrying amounts of certain of the Company’s financial instruments, including cash and cash equivalents, restricted cash, prepaid expenses and other current assets, accounts payable and accrued liabilities approximate fair value due to their short maturities. The fair value of the Company’s long-term debt is approximately $9.9 million as of September 30, 2012 based on the present value of estimated future cash flows using a discount rate commensurate with borrowing rates available to the Company. If measured at fair value in the condensed consolidated financial statements, long-term debt (including the current portion) would be classified as Level 2 in the fair value hierarchy. The Company’s assets that are measured at fair value on a recurring basis are classified within Level 1 or Level 2 of the fair value hierarchy. The Company does not hold any assets that are measured at fair value using Level 3 inputs. The types of instruments the Company invests in that are valued based on quoted market prices in active markets include U.S. treasury securities. Such instruments are classified by the Company within Level 1 of the fair value hierarchy. U.S. treasuries are valued using unadjusted quoted prices for identical assets in active markets that the Company can access. The types of instruments the Company invests in that are valued based on quoted prices in less active markets, broker or dealer quotations, or alternative pricing sources with reasonable levels of price transparency include U.S. agency securities, commercial paper, U.S. corporate bonds and municipal obligations. Such instruments are classified by the Company within Level 2 of the fair value hierarchy. The Company values these types of assets using consensus pricing or a weighted average price, which is based on multiple pricing sources received from a variety of industry standard data providers (e.g. Bloomberg), security master files from large financial institutions, and other third-party sources. The multiple prices obtained are then used as inputs into a distribution-curve-based algorithm to determine the daily market price.
Restricted Cash	*Restricted Cash* The Company had $200,000 in a cash collateral money market account as of September 30, 2012 and December 31, 2011. Pursuant to the Lease Agreement the Company entered into with Roseville Properties Management Company in July 2008, the Company was required to deliver to Roseville Properties an irrevocable, unconditional, standby letter of credit in the amount of $200,000 on the second anniversary of the commencement of lease payments. The standby letter of credit is to be maintained through October 1, 2013. The irrevocable standby letter of credit was issued by Silicon Valley Bank, who required the Company to set up a restricted cash collateral money market account to fully secure the standby letter of credit.
Inventory	*Inventory* The Company accounts for inventory at the lower of cost or market and records any long-term inventory as other assets in the condensed consolidated balance sheets.
Comprehensive Loss	*Comprehensive Loss* Comprehensive loss is defined as the change in equity of a company during a period from transactions and other events and circumstances excluding transactions resulting from investment owners and distributions to owners. The difference from reported net loss for the three and nine months ended September 30, 2012 and 2011 related entirely to changes in unrealized gains (losses) on available for sale investments.
Revenue Recognition	*Revenue Recognition* The Company recognizes revenue when persuasive evidence of an arrangement exists, title or risk of loss has passed, the selling price is fixed or determinable and collection is reasonably assured. The Company sells products internationally through distributors and recognizes revenue upon sale to the distributor as these sales are considered to be final and no right of return or price protection exists. Terms of sales to international distributors are generally EXW, reflecting that goods are shipped “ex works,” in which risk of loss is assumed by the distributor at the shipping point. The Company does not provide for rights of return to customers on product sales and therefore does not record a provision for returns.
Research and Development Expenses	*Research and Development Expenses* Research and development expenses are charged to expense as incurred. Research and development expenses include, but are not limited to, product development, clinical trial expenses, including supplies and devices, regulatory expenses, payroll and other personnel expenses, materials and consulting costs.
Derivative Instruments	*Derivative Instruments* The Company accounts for outstanding warrants that are not indexed to the Company’s stock or warrants issued when the Company has insufficient authorized and unissued stock available to share settle the outstanding warrants as derivative instruments, which require that the warrants be classified as a liability and measured at fair value with changes in fair value recognized currently in earnings and recorded separately in the condensed consolidated statements of operations.
Net Loss Per Share	*Net Loss Per Share* Basic net loss per share is computed by dividing net loss by the weighted-average number of common shares outstanding during the period. Diluted net loss per share is based on the weighted-average common shares outstanding during the period plus dilutive potential common shares calculated using the treasury stock method. Such potentially dilutive shares are excluded when the effect would be to reduce a net loss per share. The Company’s potential dilutive shares, which include outstanding common stock options, unvested common shares subject to repurchase and warrants, have not been included in the computation of diluted net loss per share for all periods as the result would be anti-dilutive.
Recently Issued Accounting Standards	*Recently Issued Accounting Standards* In June 2011, the Financial Accounting Standards Board issued guidance on the presentation of comprehensive income in financial statements. Entities are required to present total comprehensive income either in a single, continuous statement of comprehensive income or in two separate, but consecutive, statements. The Company adopted this standard during the first quarter of 2012 and presents net loss and other comprehensive loss in two separate, but consecutive, statements. The adoption of this standard did not have a material effect on the Company’s financial statement disclosures. There have been no other significant changes in recent accounting pronouncements during the nine months ended September 30, 2012 as compared to the recent accounting pronouncements described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2011.

Summary of Significant Accounting Policies (Tables)

9 Months Ended

Sep. 30, 2012

Summary of Significant Accounting Policies [Abstract]

Computation of basic and diluted net loss per share

The following table sets forth the computation of basic and diluted net loss per share for the three and nine months ended September 30, 2012 and 2011:


	Three months ended September 30,						Nine months ended September 30,
	2012			2011			2012			2011
Numerator:
Net loss	$	(5,846,840	)	$	(7,298,112	)	$	(16,433,386	)	$	(17,941,235	)

Denominator for basic and diluted net loss per share:
Weighted-average common shares outstanding		40,984,216			28,209,522			38,810,762			27,999,412
Weighted-average unvested common shares subject to repurchase		—			—			—			—

Denominator for net loss per common share—basic and diluted		40,984,216			28,209,522			38,810,762			27,999,412

Net loss per share—basic and diluted	$	(0.14	)	$	(0.26	)	$	(0.42	)	$	(0.64	)

Antidilutive Securities


	September 30,
	2012		2011
Stock options outstanding		7,879,730		2,799,908
Warrants to purchase common stock		21,493,883		23,927,766

Inventory (Tables)

9 Months Ended

Sep. 30, 2012

Inventory [Abstract]

Current inventory

Current inventory consists of the following as of:


	September 30, 2012		December 31, 2011
Raw materials	$	361,539	$	376,580
Work-in-process		1,221,434		692,043
Finished goods		28,366		—

Inventory	$	1,611,339	$	1,068,623

Commitments and Contingencies (Tables)

9 Months Ended

Sep. 30, 2012

Commitments and Contingencies [Abstract]

Operating Lease Future Minimum Payment

At September 30, 2012, future minimum payments under the lease are as follows:


Years ending December 31:
Remaining three months in 2012	$	71,058
2013		285,656
2014		291,369
2015		221,789

	$	869,872

- Definition

Tabular disclosure of a lessee's leasing arrangements including: (1) the basis on which contingent rental payments are determined, (2) the existence and terms of renewal or purchase options and escalation clauses, (3) restrictions imposed by lease arrangements, such as those concerning dividends, additional debt, and further leasing, (4) rent holidays, rent concessions, or leasehold improvement incentives and unusual provisions or conditions. Disclosure may also include the specific period used to amortize material leasehold improvements made at the inception of the lease or during the lease term. Additionally, for operating leases having initial or remaining noncancelable lease terms in excess of one year: (a) future minimum rental payments required as of the date of the latest balance sheet presented, in the aggregate and for each of the five succeeding fiscal years, (b) the total of minimum rentals to be received in the future under noncancelable subleases as of the date of the latest balance sheet presented, and (c) for all operating leases, rental expense for each period for which an income statement is presented, with separate amounts for minimum rentals, contingent rentals, and sublease rentals. Rental payments under leases with terms of a month or less that were not renewed need not be included.

+ References + Details

Notes Payable (Tables)

9 Months Ended

Sep. 30, 2012

Notes Payable [Abstract]

Debt future payments

Scheduled debt principal payments are as follows as of September 30, 2012:


Years Ending December 31:
Remaining three months in 2012	$	—
2013		3,000,000
2014		4,000,000
2015		3,000,000

		10,000,000
Less: Original issue discount		(366,598	)

Notes payable, net	$	9,633,402

Stock-based Compensation (Tables)

9 Months Ended

Sep. 30, 2012

Stock-based Compensation [Abstract]

Summary of operating expenses and employee and nonemployees


	Three months ended September 30,				Nine months ended September 30,
	2012		2011		2012		2011
Research and development	$	319,964	$	208,942	$	606,994	$	680,431
Selling, general and administrative		1,008,747		488,821		2,132,325		1,411,627

Total	$	1,328,711	$	697,763	$	2,739,319	$	2,092,058


	Three months ended September 30,				Nine months ended September 30,
	2012		2011		2012		2011
Employees	$	1,326,311	$	682,733	$	2,687,253	$	2,060,581
Nonemployees		2,400		15,030		52,066		31,477

Total	$	1,328,711	$	697,763	$	2,739,319	$	2,092,058

Schedule of share based payment award stock options valuation assumptions


	Employees						Employees
	Three months ended September 30,						Nine months ended September 30,
	2012			2011			2012			2011
Risk-free interest rates		0.90%-0.97	%		1.20%-2.16	%		0.90%-1.09	%		1.20%-2.68	%
Expected life		6.25 years			6.25 years			6.00-6.25 years			5.42-6.25 years
Expected dividends		0	%		0	%		0	%		0	%
Expected volatility		137.58%-138.38	%		116.75%-119.35	%		123.18%-141.05	%		116.75%-124.40	%


	Nonemployees						Nonemployees
	Three months ended September 30,						Nine months ended September 30,
	2012			2011			2012			2011
Risk-free interest rates		0.33	%		0.66%-1.91	%		0.24%-2.05	%		0.66%-3.45	%
Expected life		2.76 years			3.75-9.95 years			2.00-9.25 years			3.75-9.95 years
Expected dividends		0	%		0	%		0	%		0	%
Expected volatility		80.13	%		116.40%-120.50	%		80.13%-139.80	%		116.40%-123.80	%

Option activity under the Company's 2003 Stock Incentive Plan

Option activity under the Company’s Amended and Restated 2003 Stock Incentive Plan for the nine months ended September 30, 2012 was as follows:


	Shares Available For Grant			Outstanding Options
	Shares Available For Grant			Number of Shares			Weighted-Average Exercise Price
Balance, December 31, 2011		763,829			3,470,908		$	3.17
Shares reserved		8,000,000			—			—
Options granted		(4,462,873	)		4,462,873			3.35
Options exercised		—			—			—
Options cancelled		54,051			(54,051	)		2.28

Balance, September 30, 2012		4,355,007			7,879,730			3.28

Summary of Significant Accounting Policies (Details) - USD ($)	3 Months Ended		9 Months Ended		117 Months Ended
	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012
Numerator:
Net loss	$ (5,846,840)	$ (7,298,112)	$ (16,433,386)	$ (17,941,235)	$ (193,014,727)
Denominator for basic and diluted net loss per share:
Weighted - average common shares outstanding	40,984,216	28,209,522	38,810,762	27,999,412
Weighted - average unvested common shares subject to repurchase
Denominator for net loss per common share - basic and diluted	40,984,216	28,209,522	38,810,762	27,999,412
Net loss per share - basic and diluted	$ (0.14)	$ (0.26)	$ (0.42)	$ (0.64)

- Definition

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

+ References

+ Details

- Definition

This element represents the weighted average total number of shares issued throughout the period including the first (beginning balance outstanding) and last (ending balance outstanding) day of the period before considering any reductions (for instance, shares held in treasury) to arrive at the weighted average number of shares outstanding. Weighted average relates to the portion of time within a reporting period that common shares have been issued and outstanding to the total time in that period. Such concept is used in determining the weighted average number of shares outstanding for purposes of calculating earnings per share (basic).

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 260
-SubTopic 10
-Section 45
-Paragraph 10
-URI http://asc.fasb.org/extlink&oid=7655603&loc=d3e1448-109256

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 260
-SubTopic 10
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=6371337&loc=d3e3550-109257

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 260
-SubTopic 10
-Section 45
-Paragraph 13
-URI http://asc.fasb.org/extlink&oid=7655603&loc=d3e2646-109256

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 128
-Paragraph 10
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 128
-Paragraph 40
-Subparagraph a
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 128
-Paragraph 8
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

+ Details

Summary of Significant Accounting Policies (Details 1) - shares	9 Months Ended
	Sep. 30, 2012	Sep. 30, 2011
Stock options outstanding [Member]
Antidilutive Securities
Anti-dilutive as of the end of each period	7,879,730	2,799,908
Warrants to purchase common stock [Member]
Antidilutive Securities
Anti-dilutive as of the end of each period	21,493,883	23,927,766

- Definition

Securities (including those issuable pursuant to contingent stock agreements) that could potentially dilute basic earnings per share (EPS) or earnings per unit (EPU) in the future that were not included in the computation of diluted EPS or EPU because to do so would increase EPS or EPU amounts or decrease loss per share or unit amounts for the period presented.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Antidilution
-URI http://asc.fasb.org/extlink&oid=6505113

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Diluted Earnings Per Share
-URI http://asc.fasb.org/extlink&oid=6510752

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Contingent Stock Agreement
-URI http://asc.fasb.org/extlink&oid=6508534

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 260
-SubTopic 10
-Section 50
-Paragraph 1
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=6371337&loc=d3e3550-109257

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 128
-Paragraph 40
-Subparagraph c
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 128
-Paragraph 13, 14
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Emerging Issues Task Force (EITF)
-Number 07-4
-Paragraph 4
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 128
-Paragraph 171
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

+ Details

Summary of Significant Accounting Policies (Details Textual) - USD ($)	3 Months Ended		9 Months Ended		117 Months Ended
	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012	Dec. 31, 2011
Summary of Significant Accounting Policies (Additional Textual) [Abstract]
Standby letter of credit amount			$ 200,000
Net loss	$ (5,846,840)	$ (7,298,112)	(16,433,386)	$ (17,941,235)	$ (193,014,727)
Long-term debt	9,900,000		9,900,000		9,900,000
Cash collateral money market	200,000		200,000		200,000	$ 200,000
Short-term investments available for sale	$ 0		$ 0		$ 0	$ 1,005,411
Standby Letters of Credit [Member]
Summary of significant accounting policies (Textual) [Abstract]
Stand by letter of credit expiration date			Oct. 01, 2013

- Definition

Amount of investment in debt and equity securities categorized neither as trading securities nor held-to-maturity securities and intended be sold or mature one year or operating cycle, if longer.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 320
-SubTopic 10
-Section 25
-Paragraph 1
-Subparagraph (b)
-URI http://asc.fasb.org/extlink&oid=7534914&loc=d3e22054-111558

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 320
-SubTopic 10
-Section 45
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=6871852&loc=d3e26626-111562

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 115
-Paragraph 12
-Subparagraph b
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 115
-Paragraph 13, 17
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 133
-Paragraph 22
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name FASB Staff Position (FSP)
-Number FAS115-1/124-1
-Paragraph 15C
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher AICPA
-Name Accounting Research Bulletin (ARB)
-Number 43
-Section A
-Paragraph 4, 5
-Chapter 3
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Statement of Financial Accounting Standard (FAS)
-Number 115
-Paragraph 16
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name FASB Staff Position (FSP)
-Number FAS115-1/124-1
-Paragraph 15D
-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

+ Details

- Definition

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

+ References

+ Details

Inventory (Details) - USD ($)	Sep. 30, 2012	Dec. 31, 2011
Current inventory
Raw materials	$ 361,539	$ 376,580
Work-in-process	1,221,434	692,043
Finished goods	28,366
Inventory	$ 1,611,339	$ 1,068,623

Inventory (Details Textual) - USD ($)	Sep. 30, 2012	Dec. 31, 2011
Inventory (Textual) [Abstract]
Long-term inventory	$ 373,000	$ 228,000

Commitments and Contingencies (Details)	Sep. 30, 2012 USD ($)
Operating Lease Future Minimum Payment
Remaining three months in 2012	$ 71,058
2013	285,656
2014	291,369
2015	221,789
Total	$ 869,872

Commitments and Contingencies (Details Textual)	9 Months Ended
Commitments and Contingencies (Details Textual)	Sep. 30, 2012
Commitments and Contingencies (Textual) [Abstract]
Operating lease expiration date	Sep. 30, 2015

Notes Payable (Details) - USD ($)	Sep. 30, 2012	Dec. 31, 2011
Debt future payments
Remaining three months in 2012
2013	3,000,000
2014	4,000,000
2015	3,000,000
Notes Payable Gross	10,000,000
Less: Original issue discount	(366,598)	$ (216,711)
Notes payable, net	$ 9,633,402

Notes Payable (Details Textual)	9 Months Ended
Notes Payable (Details Textual)	Sep. 30, 2012 USD ($)	Apr. 23, 2012 USD ($) Installment	Apr. 16, 2012 USD ($) $ / Unit shares	Mar. 01, 2011 Installment	Jul. 08, 2010 Installment $ / Unit shares	Feb. 08, 2010	Apr. 28, 2009 USD ($)	Nov. 21, 2008 USD ($)	Nov. 18, 2008 USD ($)
Notes Payable (Textual) [Abstract]
Loan agreement with annual rate				11.00%
Loan agreement with fixed annual rate		8.00%		6.25%
Term loans, agreed sum									$ 20,000,000
Term loan granted		$ 10,000,000	$ 10,000,000
Notes Payable (Additional Textual) [Abstract]
Amount used to repay outstanding debt		$ 4,700,000
Repayment of principal amount	$ 333,333
Conditional amount to be placed in restricted account at SVB	$ 7,500,000
Silicon Valley Bank [Member]
Notes Payable (Textual) [Abstract]
Loan agreement with annual rate					10.00%	11.00%
Loan agreement with fixed annual rate					11.00%	10.00%
Issued warrant \| shares			106,746		150,642
Exercise price \| $ / Unit			2.34		2.10
Term loans, agreed sum			$ 20,000,000
Term loan granted								$ 10,000,000
Number of installments of repayment of debt. \| Installment		30		30	30
Time for exercising warrant			10 years
Western Technology Investment [Member]
Notes Payable (Textual) [Abstract]
Term loan granted								$ 5,000,000
Horizon Funding [Member]
Notes Payable (Textual) [Abstract]
Term loan granted							$ 5,000,000

Stock-based Compensation (Details) - USD ($)	3 Months Ended		9 Months Ended
Stock-based Compensation (Details) - USD ($)	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012	Sep. 30, 2011
Summary of operating expenses and employee and nonemployees
Gross stock-based compensation expense	$ 1,328,711	$ 697,763	$ 2,739,319	$ 2,092,058
Research and development [Member]
Summary of operating expenses and employee and nonemployees
Gross stock-based compensation expense	319,964	208,942	606,994	680,431
Selling, general and administrative [Member]
Summary of operating expenses and employee and nonemployees
Gross stock-based compensation expense	1,008,747	488,821	2,132,325	1,411,627
Employees [Member]
Summary of operating expenses and employee and nonemployees
Gross stock-based compensation expense	1,326,311	682,733	2,687,253	2,060,581
Nonemployees [Member]
Summary of operating expenses and employee and nonemployees
Gross stock-based compensation expense	$ 2,400	$ 15,030	$ 52,066	$ 31,447

- Definition

Represents the expense recognized during the period arising from equity-based compensation arrangements (for example, shares of stock, unit, stock options or other equity instruments) with employees, directors and certain consultants qualifying for treatment as employees.

+ References + Details

Stock-based Compensation (Details1)	3 Months Ended		9 Months Ended
Stock-based Compensation (Details1)	Sep. 30, 2012	Sep. 30, 2011	Sep. 30, 2012	Sep. 30, 2011
Employees [Member]
Schedule of share based payment award stock options valuation assumptions
Expected life	6 years 3 months	6 years 3 months
Expected dividends	0.00%	0.00%	0.00%	0.00%
Employees [Member] \| Maximum [Member]
Schedule of share based payment award stock options valuation assumptions
Risk-free interest rates	0.97%	2.16%	1.09%	2.68%
Expected life			6 years 3 months	6 years 3 months
Expected volatility	138.38%	119.35%	141.05%	124.40%
Employees [Member] \| Minimum [Member]
Schedule of share based payment award stock options valuation assumptions
Risk-free interest rates	0.90%	1.20%	0.90%	1.20%
Expected life			6 years	5 years 5 months 1 day
Expected volatility	137.58%	116.75%	123.18%	116.75%
Nonemployees [Member]
Schedule of share based payment award stock options valuation assumptions
Risk-free interest rates	0.33%
Expected life	2 years 9 months 4 days
Expected dividends	0.00%	0.00%	0.00%	0.00%
Expected volatility	80.13%
Nonemployees [Member] \| Maximum [Member]
Schedule of share based payment award stock options valuation assumptions
Risk-free interest rates		1.91%	2.05%	3.45%
Expected life		9 years 11 months 12 days	9 years 3 months	9 years 11 months 12 days
Expected volatility		120.50%	139.80%	123.80%
Nonemployees [Member] \| Minimum [Member]
Schedule of share based payment award stock options valuation assumptions
Risk-free interest rates		0.66%	0.24%	0.66%
Expected life		3 years 9 months	2 years	3 years 9 months
Expected volatility		116.40%	80.13%	116.40%

Stock-based Compensation (Details 2)	9 Months Ended
Stock-based Compensation (Details 2)	Sep. 30, 2012 $ / shares shares
Option activity under the Company's 2003 Stock Incentive Plan
Shares Available For Grant, Beginning Balance	763,829
Outstanding Options, Number of Shares, Beginning Balance	3,470,908
Outstanding Options, Weighted-Average Exercise Price, Beginning Balance \| $ / shares	$ 3.17
Shares Available For Grant, Shares reserved	8,000,000
Outstanding Options, Number of Shares, Shares reserved
Outstanding Options, Weighted-Average Exercise Price, Shares reserved \| $ / shares
Shares Available For Grant, Options granted	(4,462,873)
Outstanding Options, Number of Shares, Options granted	4,462,873
Outstanding Options, Weighted-Average Exercise Price, Options granted \| $ / shares	$ 3.35
Shares Available For Grant, Options exercised
Outstanding Options, Number of Shares, Options exercised
Outstanding Options, Weighted-Average Exercise Price, Options exercised \| $ / shares
Shares Available For Grant, Options cancelled	54,051
Outstanding Options, Number of Shares, Options cancelled	(54,051)
Outstanding Options, Weighted-Average Exercise Price, Options cancelled \| $ / shares	$ 2.28
Shares Available For Grant, Ending Balance	4,355,007
Outstanding Options, Number of Shares, Ending Balance	7,879,730
Outstanding Options, Weighted-Average Exercise Price, Ending Balance \| $ / shares	$ 3.28

Stock-based Compensation (Details Textual) $ in Millions	9 Months Ended
Stock-based Compensation (Details Textual) $ in Millions	Sep. 30, 2012 USD ($)
Stock Based Compensation (Textual) [Abstract]
Unrecognized compensation costs	$ 17.5
Expected to be recognized	3 years 5 months 12 days

Stock Sales (Details) - USD ($) $ / shares in Units, $ in Millions	Sep. 30, 2012	Apr. 20, 2012	Apr. 16, 2012	Dec. 31, 2011
Stock Sales (Textual) [Abstract]
Sale of share of its common stock in a registered direct offering	41,560,615		2,271,705	36,752,746
Purchase price per share			$ 2.223
Gross proceeds before deducting estimated offering expenses		$ 5.0

Subsequent Events (Details) $ / shares in Units, $ in Millions	9 Months Ended
	Sep. 30, 2012 USD ($) $ / shares shares
Maximum [Member]
Subsequent Events (Textual) [Abstract]
Discount percentage on issue of shares under common stock purchase agreement	6.80%
Minimum [Member]
Subsequent Events (Textual) [Abstract]
Discount percentage on issue of shares under common stock purchase agreement	4.00%
Subsequent Event [Member]
Subsequent Events (Textual) [Abstract]
Maximum Amount of common stock which can be sold under common stock purchase agreement \| $	$ 45.0
Maximum Number of Shares of common stock which can be sold under common stock purchase agreement \| shares	8,312,122
Period for the sale of common stock	24 months
Pre discounted purchase price \| $ / shares	$ 1.25
Maximum percentage of holding of Common stock at pre discounted price	9.90%