What changed in this filing

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Item 1. Financial Statements

2022-08-04 compared with 2022-05-05 · 125 added, 70 removed, 455 unchanged (30% of the section changed)

6 unchanged sentences

Investments 160,178,000 226,041,000

Accounts receivable, net of allowance for doubtful accounts of $ 463,000 and $ 690,000 as of March 31, 2022 and December 31, 2021, respectively

Accounts receivable, net of allowance for doubtful accounts of $ 463,000 and $ 690,000 as of June 30, 2022 and December 31, 2021, respectively

4,851,000 4,934,000

16 unchanged sentences

Finance lease liability, related party 292,000 299,000

Contingent consideration 9,224,000 —

Total current liabilities 27,908,000 21,840,000

7 unchanged sentences

Preferred stock, $ 0.0001 par value;

10,000,000 shares authorized and no shares issued or outstanding as of March 31, 2022 and December 31, 2021

Common stock, $ 0.0001 par value, 400,000,000 shares authorized at March 31, 2022 and December 31, 2021;

289,688,000 and 289,602,000 shares issued and outstanding at March 31, 2022 and December 31, 2021, respectively

10,000,000 shares authorized and no shares issued or outstanding as of June 30, 2022 and December 31, 2021

Common stock, $ 0.0001 par value, 400,000,000 shares authorized at June 30, 2022 and December 31, 2021;

290,061,000 and 289,602,000 shares issued and outstanding at June 30, 2022 and December 31, 2021, respectively

29,000 29,000

8 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2022 2021 2022 2021

Product revenue $ 3,913,000 $ 2,496,000 $ 7,029,000 $ 4,545,000

14 unchanged sentences

Gain on forgiveness of Paycheck Protection Program loan — — — 1,775,000

Loss on debt extinguishment — ( 2,076,000 ) — ( 2,076,000 )

Other income (expense) ( 156,000 ) ( 15,000 ) ( 188,000 ) ( 29,000 )

9 unchanged sentences

Three Months Ended

June 30, Six Months Ended

June 30, 2022

2022 2021 2022 2021

$ ( 32,158,000 ) $ ( 18,786,000 ) $ ( 62,112,000 ) $ ( 28,733,000 )

Unrealized (loss) on investment securities

15 unchanged sentences

Balance at March 31, 2021 278,794,000 $ 28,000 $ 516,321,000 $ ( 153,631,000 ) $ — $ 362,718,000

Stock option exercises 60,000 — 89,000 — — 89,000

Stock-based compensation expense — — 1,758,000 — — 1,758,000

Issue stock for employee stock purchase plan 150,000 — 65,000 — — 65,000

Issue stock for warrant exercises 50,000 — 22,000 — — 22,000

Net loss — — — ( 18,786,000 ) — ( 18,786,000 )

Balance at June 30, 2021 279,054,000 28,000 518,255,000 ( 172,417,000 ) — 345,866,000

Balance at January 1, 2022 289,602,000 $ 29,000 $ 553,747,000 $ ( 216,119,000 ) $ ( 539,000 ) $ 337,118,000

5 unchanged sentences

Balance at March 31, 2022 289,688,000 $ 29,000 $ 558,864,000 $ ( 246,071,000 ) $ ( 1,637,000 ) $ 311,185,000

Stock option exercises 249,000 — 136,000 — — 136,000

Stock-based compensation expense — — 5,777,000 — — 5,777,000

Issuance of common stock due to the vesting of restricted stock units, net of shares withheld to cover taxes ( 26,000 ) — — — — —

Issue stock for employee stock purchase plan 150,000 — 75,000 — — 75,000

Net loss — — — ( 32,158,000 ) — ( 32,158,000 )

Other comprehensive loss — — — — ( 281,000 ) ( 281,000 )

Balance at June 30, 2022 290,061,000 $ 29,000 $ 564,852,000 $ ( 278,229,000 ) $ ( 1,918,000 ) $ 284,734,000

See accompanying notes to the unaudited condensed consolidated financial statements

1 unchanged sentence

Condensed Consolidated Statements of Cash Flows

Three Months Ended

Six Months Ended

Operating activities:

9 unchanged sentences

Gain on forgiveness of PPP Loan — ( 1,775,000 )

Loss on debt extinguishment — 2,076,000

Cost of leased equipment sold to customer 204,000 —

Changes in operating assets and liabilities:

14 unchanged sentences

Financing activities:

Repayment of term-loan debt — ( 17,010,000 )

Principal payments of financing lease liability ( 17,000 ) —

1 unchanged sentence

Offering expenses on sale of common stock — ( 1,149,000 )

Proceeds from sale of common stock under employee stock purchase plan 75,000 65,000

Proceeds from warrant and option exercises 152,000 9,837,000

10 unchanged sentences

Forgiveness of PPP Loan $ — $ 1,775,000

Offering costs in accounts payable $ — $ 324,000

Warrant exercise pursuant to cashless exercise $ — $ 129,000

10 unchanged sentences

(“Lineagen”) business, the Company also provides diagnostic testing for patients with clinical presentations consistent with autism spectrum disorder and other neurodevelopmental disabilities.

Through its BioDiscovery, LLC.

(“BioDiscovery”) business, the Company also offers an industry-leading, platform-agnostic software solution, which integrates next-generation sequencing and microarray data designed to provide analysis, visualization, interpretation and reporting of copy number variants, single-nucleotide variants and absence of heterozygosity across the genome in one consolidated view.

Through its BioDiscovery, LLC (“BioDiscovery”) business, the Company also offers an industry-leading, platform-agnostic software solution, which integrates next-generation sequencing and microarray data designed to provide analysis, visualization, interpretation and reporting of copy number variants, single-nucleotide variants and absence of heterozygosity across the genome in one consolidated view.

Basis of Presentation

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These interim condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021.

As of March 31, 2022, the Company had approximately $ 24.0 million in cash and cash equivalents, $ 192.4 million in available for sale investment securities, and working capital of $ 223.7 million as a result of common stock offerings executed in the quarters ended December 31, 2020, March 31, 2021, and September 30, 2021.

In February 2021, the Company applied for forgiveness of its Paycheck Protection Program Loan of approximately $ 1.8 million (the “PPP Loan”), and in March 2021, the PPP Loan, including all accrued interest, was forgiven in full.

As of June 30, 2022, the Company had approximately $ 27.2 million in cash and cash equivalents, $ 160.2 million in available for sale investment securities, and working capital of $ 188.4 million as a result of common stock offerings executed in the quarters ended December 31, 2020, March 31, 2021, and September 30, 2021.

The Company believes its available cash, cash equivalents, and available for sale securities will be sufficient to fund operations, obligations as they become due and capital investments for at least the next 12 months.

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If the Company is not able to secure adequate additional funding, the Company may be forced to make reductions in spending, potentially harming the Company’s business.

The Company is subject to additional risks and uncertainties as a result of the continued spread of COVID-19 and uncertain market conditions, which could continue to have a material impact on the Company’s business and financial results.

COVID-19 and Other Geopolitical Events

The Company is subject to additional risks and uncertainties as a result of the continued spread of COVID-19, adverse macroeconomic events, such as the ongoing conflict between Ukraine and Russia and related sanctions, and uncertain market conditions, including higher inflation and supply chain disruptions, which could continue to have a material impact on the Company’s business and financial results.

The Company closely monitors and complies with various applicable guidelines and legal requirements in the jurisdictions in which it operates, which may continue to result in reduced business operations in response to new or existing stay-at-home orders, travel restrictions and other social distancing measures.

3 unchanged sentences

The Company’s manufacturing partners, suppliers, and customers, have implemented similar operational reductions.

Despite reporting an increase in revenue for the three months ended March 31, 2022 when compared to the same period in 2021, the Company experienced supply chain constraints that negatively impacted the Company’s first quarter 2022 financial results.

Despite reporting an increase in revenue for the three and six months ended June 30, 2022 when compared to the same period in 2021, the Company experienced supply chain constraints that negatively impacted the Company’s first and second quarter 2021 and 2022 financial results.

Given the continued evolution of the COVID-19 pandemic and the related complexities and uncertainties associated with the additional variants, the future effects of COVID-19 are unknown and the Company’s financial results may continue to be negatively affected in the future.

During the three months ended March 31, 2022, the Company experienced supply chain challenges, which it largely attributes to the COVID-19 pandemic.

While the COVID-19 pandemic did not prevent the Company from operating its business during the three months ended March 31, 2022, it experienced increased cost to secure certain component parts in its products and to produce its products at its contract manufacturers.

There may be long-term negative effects of the COVID-19 pandemic, even after it has subsided.

Specifically, product demand may be reduced due to an economic recession, a decrease in corporate capital expenditures, prolonged unemployment, reduction in consumer confidence, or any similar negative economic condition.

The COVID-19 pandemic may also have long-term effects on the nature of the office environment and remote working, which may

present strategy, operational, talent recruiting and retention and workplace culture challenges that may adversely affect its business.

Following the recent invasion of Ukraine by Russia, the U.S.

and global financial markets experienced volatility, which has led to disruptions to trade, commerce, pricing stability, credit availability, supply chain continuity and reduced access to liquidity globally.

In response to the invasion, the United States, United Kingdom and European Union, along with others, imposed significant new sanctions and export controls against Russia, Russian banks and certain Russian individuals and may implement additional sanctions or take further punitive actions in the future.

The full economic and social impact of the sanctions imposed on Russia and possible future punitive measures that may be implemented, as well as the counter measures imposed by Russia, in addition to the ongoing military conflict between Ukraine and Russia and related sanctions, which could conceivably expand into the surrounding region, remains uncertain;

however, both the conflict and related sanctions have resulted and could continue to result in disruptions to trade, commerce, pricing stability, credit availability, supply chain continuity and reduced access to liquidity on acceptable terms, in both Europe and globally, and has introduced significant uncertainty into global markets.

As a result, our business and results of operations may be adversely affected by the ongoing military conflict between Ukraine and Russia and related sanctions, particularly to the extent it escalates to involve additional countries, further economic sanctions or wider military conflict.

During the three and six months ended June 30, 2022, the Company experienced supply chain challenges, which it largely attributes to the COVID-19 pandemic and the general disruptions from the ongoing conflict between Ukraine and Russia and related sanctions.

While neither the COVID-19 pandemic nor the Ukraine-Russia conflict prevented the Company from operating its business during the three and six months ended June 30, 2022, it experienced increased cost to secure certain component parts in its products and to produce its products at its contract manufacturers.

The Company expects these increased costs to remain high as the COVID-19 pandemic, the Ukraine-Russia conflict and their respective effects persist.

As global economic conditions recover from the COVID-19 pandemic, the Ukraine-Russia conflict and the related sanctions, business activity may not recover as quickly as anticipated, and it is not possible at this time to estimate the long-term impact that these and related events could have on the Company’s business, as the impact will depend on future developments, which are highly uncertain and cannot be predicted.

For instance, product demand may be reduced due to an economic recession, rising inflation rates, labor shortages, a decrease in corporate capital expenditures, prolonged unemployment, reduction in consumer confidence, adverse macroeconomic events, or any similar negative economic condition.

Further, the travel restrictions on the Company’s business have limited its ability to support its global and domestic operations, including providing installation and training and customer service, which has and may continue to slow the pace of its commercial strategy, sales and marketing efforts.

1 unchanged sentence

Significant Accounting Policies

During the three months ended March 31, 2022, there were no changes to the Company’s significant accounting policies as described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021.

During the three and six months ended June 30, 2022, there were no changes to the Company’s significant accounting policies as described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021.

Recently Issued But Not Yet Adopted Accounting Pronouncements

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The Company also made accounting policy elections not to apply the recognition requirements under ASC 842 to any short-term leases and to account for each separate lease and associated non-lease components as a single lease component for all the Company’s leases.

The adoption of this new accounting standard resulted in increased qualitative and quantitative disclosures regarding the amount, timing, and uncertainty of cash flows arising from leases.

The adoption of this new accounting standard resulted in increased qualitative and quantitative disclosures regarding the amount,

timing, and uncertainty of cash flows arising from leases.

For further details, see Note 7, Commitments and Contingencies.

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Potentially dilutive securities not included in the calculation of diluted net loss per share attributable to common stockholders because to do so would be anti-dilutive are as follows (in common stock equivalent shares):

2022 March 31,

2022 June 30,

Stock options 23,585,000 9,550,000

6 unchanged sentences

Revenue by Source

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2022 2021 2022 2021

Instruments $ 2,446,000 $ 1,158,000 $ 4,042,000 $ 2,040,000

4 unchanged sentences

Revenue by Geographic Location

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2022 2021 2022 2021

$ % $ % $ % $ %

Americas $ 2,611,000 39 % $ 2,365,000 61 % $ 5,940,000 48 % $ 3,872,000 55 %

6 unchanged sentences

Asia Pacific includes China, Japan, South Korea, Singapore and Australia.

For the three months ended March 31, 2022 and 2021, the United States represented 45.0 % and 44.8 % of total revenue, respectively.

No other countries represented greater than 10% of revenue during the three months ended March 31, 2022 and 2021.

For the three months ended June 30, 2022 and 2021, the United States represented 37.4 % and 59.5 % of total revenue, respectively.

six months ended June 30, 2022 and 2021, the United States represented 40.9 % and 53.1 % of total revenue, respectively.

For the three and six months ended June 30, 2022, China represented 19.3 % and 12.9 % of total revenue, respectively.

No other countries represented greater than 10% of revenue during the three and six months ended June 30, 2022 and 2021.

Remaining Performance Obligations

As of March 31, 2022, the estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied was approximately $ 1.2 million.

As of June 30, 2022, the estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied was approximately $ 1.4 million.

These remaining performance obligations primarily relate to extended warranty and support and maintenance obligations.

1 unchanged sentence

Warranty revenue is included in service and other revenue.

The Company recognized revenue of approximately $ 0.3 million and $ 0.2 million during the three months ended March 31, 2022 and 2021, respectively, which was included in the contract liability balance at the end of the previous year.

The Company recognized revenue of approximately $ 0.2 million and $ 0.1 million during the three months ended June 30, 2022 and 2021, respectively, and revenue of approximately $ 0.5 million and $ 0.2 million during the six months ended June 30, 2022 and 2021, respectively, which was included in the contract liability balance at the end of the previous year.

Balance Sheet Account Details

12 unchanged sentences

Intangible assets that are subject to amortization consisted of the following for the periods presented:

March 31, 2022

June 30, 2022

December 31, 2021

14 unchanged sentences

Warranty liabilities 175,000 175,000

Accrued clinical study fees 169,000 1,000

Other 154,000 1,114,000

4 unchanged sentences

In February 2021, the Company applied for forgiveness of the PPP Loan, and in March 2021, the PPP Loan, including all accrued interest, was forgiven in full.

A gain on forgiveness of Paycheck Protection Program loan of $ 1.8 million was recognized during the three months ended March 31, 2021.

A gain on forgiveness of Paycheck Protection Program loan of $ 1.8 million was recognized during the six months ended June 30, 2021.

Innovatus Loan and Security Agreement

In May 2021, the outstanding term loan with Innovatus (“Innovatus LSA”) was paid in full, including all accrued interest, the end of term fee, and a prepayment fee for a total of approximately $ 17.0 million.

Interest expense recognized during the three months ended March 31, 2021 totaled approximately $ 0.6 million.

Interest expense recognized during the three and six months ended June 30, 2021 totaled approximately $ 0.3 million and $ 0.9 million, respectively.

Stockholders’ Equity and Stock-Based Compensation

1 unchanged sentence

On January 12, 2021 and January 25, 2021, the Company completed an underwritten public offering of 33.4 million and 38.3 million shares of common stock, respectively.

The price to the public in the offerings on January 12, 2021 and January 15,

2021 was $ 3.05 and $ 6.00 per share, respectively.

The price to the public in the offerings on January 12, 2021 and January 15, 2021 was $ 3.05 and $ 6.00 per share, respectively.

The net proceeds to the Company from the offerings, after deducting the underwriting discounts and commissions and other offering expenses, were $ 101.5 million and $ 229.6 million, respectively.

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On January 19, 2021, the Company filed an automatically effective shelf registration statement on Form S-3 with the SEC as a “well-known seasoned issuer,” allowing for the Company to issue an indeterminate number or amount of its securities from time to time in one or more offerings.

On March 23, 2021, the Company entered into a Sales Agreement with Cowen and Company, LLC (“Cowen”) which provides for the sale, in the Company’s sole discretion, of shares of common stock having an aggregate offering price of up to $ 350.0 million through or to Cowen, acting as sales agent or principal (the “Cowen ATM”) .

As of June 30, 2022, as a consequence of the Company’s re-qualification as a “smaller reporting company,” the Company may lose “well-known seasoned issuer” status at the time it files its Annual Report on Form 10-K for the fiscal year ending December 31, 2022 if the worldwide market value of its voting and non-voting common equity held by its non-affiliates does not equal $700.0 million or more, calculated as of a date within 60 days prior to filing such report.

If that were to occur and the Company were no longer considered a well-known seasoned issuer, the Company anticipates needing to amend its automatically effective shelf registration statement on Form S-3 prior to its filing of such annual report (or earlier if required by the Securities Act or the rules and regulations of the SEC) in order to sell securities under that Form S-3 on an ongoing basis.

$ 350.0 million through or to Cowen, acting as sales agent or principal (the “Cowen ATM”).

The Company agreed to pay Cowen a commission of up to 3.0 % of the aggregate gross proceeds from each sale of shares, reimburse legal fees and disbursements and provide Cowen with customary indemnification and contribution rights.

In August and September 2021, the Company sold approximately 2.3 million shares of common stock under the Cowen ATM at an average share price of $ 6.15 per share, and received gross proceeds of approximately $ 13.9 million before deducting offering costs of $ 0.6 million.

There were no sales of common stock under the Cowen ATM from January 1, 2022 to March 31, 2022 .

There were no sales of common stock under the Cowen ATM from January 1, 2022 to June 30, 2022.

Stock Warrants

A summary of the Company’s warrant activity during the three months ended March 31, 2022 was as follows:

A summary of the Company’s warrant activity during the six months ended June 30, 2022 was as follows:

Shares of Stock under Warrants Weighted-

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Canceled — — — —

Outstanding at March 31, 2022

Outstanding at June 30, 2022

4,356,000 $ 5.96 1.27 $ 246,000

Stock Options

A summary of the Company’s stock option activity during the three months ended March 31, 2022 was as follows:

A summary of the Company’s stock option activity during the six months ended June 30, 2022 was as follows:

Shares of Stock under Stock Options Weighted-

5 unchanged sentences

Canceled ( 1,708,000 ) 5.00 — —

Outstanding at March 31, 2022

Outstanding at June 30, 2022

23,584,000 $ 3.47 9.08 $ 2,053,000

Vested and exercisable at March 31, 2022

Vested and exercisable at June 30, 2022

4,976,000 $ 3.90 7.96 $ 1,327,000

For the three months ended March 31, 2022, the weighted-average grant date fair value of stock options granted was $ 1.39 per share.

For the three months ended June 30, 2022, the weighted-average grant date fair value of stock options granted was $ 1.17 per share.

For the six months ended June 30, 2022, the weighted-average grant date fair value of stock options granted was $ 1.33 per share.

Stock-Based Compensation

1 unchanged sentence

Three Months Ended

June 30, Six Months Ended

2022 2021 2022 2021

Research and development $ 3,468,000 $ 384,000 $ 6,795,000 $ 465,000

3 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2022 2021 2022 2021

Risk-free interest rate 2.8 % 1.1 % 2.1 % 1.1 %

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One-third of the Restricted Shares will vest on October 18, 2022 and one-twelfth of the Restricted Shares shall vest every three months following October 18, 2022, subject to continuous service of a key employee.

The weighted average remaining contractual term for the restricted stock is 2.6 years as of March 31, 2022.

The weighted average remaining contractual term for the restricted stock is 2.3 years as of June 30, 2022.

The fair value of the restricted stock award is based on the market value of common stock as of the date of grant and is amortized to expense over the respective vesting period or the service period.

Restricted Stock Units and Performance Stock Units

The following table summarizes restricted share unit (“RSU”) activity during the three months ended March 31, 2022:

The following table summarizes restricted share unit (“RSU”) activity during the six months ended June 30, 2022:

Stock Units Weighted- Average Grant Date Fair Value per Share

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Forfeited — —

Outstanding at March 31, 2022

Outstanding at June 30, 2022

230,000 $ 4.74

The total intrinsic value of the RSUs that vested was $ 0.3 million during the three months ended March 31, 2022, determined as of the date of vesting.

The weighted average remaining contractual term for the RSUs is 1.1 years as of March 31, 2022.

The following table summarizes performance share unit (“PSU”) activity during the quarter ended March 31, 2022:

The total intrinsic value of the RSUs that vested during the six months ended June 30, 2022 was $ 0.6 million, determined as of the date of vesting.

The weighted average remaining contractual term for the RSUs is 0.9 years as of June 30, 2022.

The following table summarizes performance share unit (“PSU”) activity during the six months ended June 30, 2022:

Stock Units Weighted- Average Grant Date Fair Value per Share

1 unchanged sentence

Forfeited — —

Outstanding at March 31, 2022

Outstanding at June 30, 2022

290,000 $ 4.74

The weighted average remaining contractual term for the PSUs is 3.1 years as of March 31, 2022.

The weighted average remaining contractual term for the PSUs is 2.9 years as of June 30, 2022.

Executive Option Grants

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These stock option grants were issued from the 2018 Stock Plan.

The shares subject to the option shall vest monthly over 48 months beginning on the one-month anniversary of the Grant Date, such that the option shall be fully vested and exercisable on the four-year anniversary of the Grant Date.

The shares subject to the option shall vest monthly over 48 months beginning on

the one-month anniversary of the Grant Date, such that the option shall be fully vested and exercisable on the four-year anniversary of the Grant Date.

Commitments and Contingencies

The Company discounts its lease payments using its incremental borrowing rate as of the commencement of the lease.

The Company has determined a weighted-average discount rate of 7.1 % as of March 31, 2022 and December 31, 2021.

The operating lease right-of-use asset and operating lease liability as of March 31, 2022 and December 31, 2021 are as follows:

March 31, 2022 December 31, 2021

The Company has determined a weighted-average discount rate of 7 % as of June 30, 2022 and December 31, 2021.

The operating lease right-of-use asset and operating lease liability as of June 30, 2022 and December 31, 2021 are as follows:

June 30, 2022 December 31, 2021

Operating lease right-of-use assets $ 6,431,000 $ 6,691,000

3 unchanged sentences

Total operating lease liability $ 6,832,000 $ 6,755,000

For the three months ended March 31, 2022, the Company recorded $ 0.5 million in expense related to operating leases, including amortized tenant improvement allowances.

For the three months ended March 31, 2021, the Company recorded $ 0.2 million in expense related to operating leases, including amortized tenant improvement allowances.

The finance lease right-of-use asset and finance lease liability as of March 31, 2022 and December 31, 2021 are as follows:

March 31, 2022 December 31, 2021

For the three and six months ended June 30, 2022, the Company recorded $ 0.5 million and $ 1.0 million, respectively, in expense related to operating leases, including amortized tenant improvement allowances.

For the three and six months ended June 30, 2021, the Company recorded $ 0.3 million and $ 0.5 million respectively, in expense related to operating leases, including amortized tenant improvement allowances.

The finance lease right-of-use asset and finance lease liability as of June 30, 2022 and December 31, 2021 are as follows:

June 30, 2022 December 31, 2021

Finance lease right-of-use assets $ 3,810,000 $ 3,926,000

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Total finance lease liability $ 3,924,000 $ 3,941,000

For the three months ended March 31, 2022, the Company recorded $ 0.1 million in expense related to its finance lease.

The Company did not hold a finance lease as of March 31, 2021.

The future minimum payments under non-cancellable operating and finance leases as of March 31, 2022, are as follows:

For the three and six months ended June 30, 2022, the Company recorded $ 0.1 million and $ 0.3 million, respectively, in expense related to its finance lease.

The Company did no t hold a finance lease as of June 30, 2021.

The future minimum payments under non-cancellable operating and finance leases as of June 30, 2022, are as follows:

Operating Leases Finance Lease

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The following unaudited pro forma financial information is for informational purposes only and is not necessarily indicative of the results of operations that would have been achieved as if the acquisitions had taken place as of January 1, 2020.

Three Months Ended March 31,

Six Months Ended June 30, Three Months Ended June 30,

Revenue $ 9,467,000 $ 5,313,000

1 unchanged sentence

Basic and diluted net loss per share

$ ( 0.11 ) $ ( 0.07 )

Investments and Fair Value Measurements

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Such valuations may be based on trade prices in active markets for identical assets or liabilities (Level 1 inputs) or valuation models using inputs that are observable either directly or indirectly (Level 2 inputs), such as quoted prices for similar assets or liabilities, yield curves, volatility factors, credit spreads, default rates, loss severity, current market and contractual prices for the underlying instruments or debt, and broker and dealer quotes, as well as other relevant economic measures.

The following table presents the Company’s financial assets and liabilities measured at fair value on a recurring basis as of March 31, 2022 and December 31, 2021:

March 31, 2022

The following table presents the Company’s financial assets and liabilities measured at fair value on a recurring basis as of June 30, 2022 and December 31, 2021:

June 30, 2022

Total Fair Value and Carrying Value on Balance Sheet Fair Value Measurement Category

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Corporate Notes/Bonds 100,384,000 — 100,384,000 —

Securities of Government Sponsored Entities 2,985,000 $ — 2,985,000 $ —

Total Investments:

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Money Market Funds are classified as cash equivalents on the balance sheet.

As of March 31, 2022 and December 31, 2021, the Company held 51 and 57 securities in an unrealized loss position, respectively.

None of the Company’s available for sale investment securities were in a material unrealized loss position at March 31, 2022 or December 31, 2021.

As of June 30, 2022 and December 31, 2021, the Company held 47 and 57 securities in an unrealized loss position, respectively.

As of June 30, 2022 and December 31, 2021, the Company does not intend to sell these investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost basis.

The Company does not believe the unrealized losses incurred during the period are due to credit-related factors.

The credit ratings of the securities held remain of high quality, and the Company continues to receive payments of interest and principal as they become due, and our expectation is that those payments will continue to be received timely.

As such, the Company has not recognized any impairment in its financial statements related to its available for sale investment securities.

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The Company determined it is highly likely that the milestone will be achieved and therefore used a 95 % probability factor which is applied to the $ 10.0 million milestone consideration.

The change in fair value of the contingent consideration during the three month period ended March 31, 2022 was due to the passage of time.

Changes in estimated fair value of contingent consideration liability in the three months ended March 31, 2022 is as follows:

The change in fair value of the contingent consideration during the three and six month period ended June 30, 2022 was due to the passage of time.

During the three months ended June 30, 2022, the milestone consideration liability was reclassified from non-current liabilities to current liabilities.

Changes in estimated fair value of contingent consideration liability in the six months ended June 30, 2022 is as follows:

Consideration

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Cash payments —

Balance as of March 31, 2022

As of March 31, 2022, the following table summarizes the amortized cost and the unrealized gains (losses) of the available for sale securities:

Commercial Paper Corporate Notes/Bonds

Balance as of June 30, 2022

As of June 30, 2022, the following table summarizes the amortized cost and the unrealized gains (losses) of the available for sale securities:

Commercial Paper Corporate Notes/Bonds Securities of Government Sponsored Entities

Amortized Cost

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Unrealized gains (losses)

Amortized Cost Unrealized gains (losses)

Less than 1 year $ 57,070,000 $ ( 261,000 ) $ 65,045,000 $ ( 909,000 ) $ 2,986,000 $ ( 1,000 )

2 unchanged sentences

As of December 31, 2021, the following table summarizes the amortized cost and the unrealized gains (losses) of the available for sale securities:

Commercial Paper Corporate Notes/Bonds

Commercial Paper Corporate Notes/Bonds Securities of Government Sponsored Entities

Amortized Cost

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Unrealized loss

Amortized Cost Unrealized gains (losses)

Less than 1 year $ 100,929,000 $ ( 69,000 ) $ 41,173,000 $ ( 61,000 ) $ — $ —

1 unchanged sentence

Total $ 100,929,000 $ ( 69,000 ) $ 125,651,000 $ ( 470,000 ) $ — $ —

Included in interest income for the three-month period ended March 31, 2022 was interest income related to the Company’s available for sale securities of $ 0.1 million.

Included in interest income for the three-month period ended June 30, 2022 was interest income related to the Company’s available for sale securities of $ 0.2 million.

Included in interest income for the six-month period ended June 30, 2022 was interest income related to the Company’s available for sale securities of $ 0.3 million.

All available for sale securities are classified as current assets, even if the maturity when acquired by the Company is greater than one year due to the ability to liquidate within the next 12 months.

1 unchanged sentence

Through the acquisition of BioDiscovery in October 2021, the Company inherited a building lease with a landlord owned by BioDiscovery’s former Director and Chief Executive Officer, who is now the Company’s Chief Informatics Officer.

The Company recorded $ 0.1 million in finance lease costs related to this lease for the three-month period ended March 31, 2022.

The Company recorded $ 0.1 million in finance lease costs related to this lease for the three-month period ended June 30, 2022.

The Company recorded $ 0.3 million in finance lease costs related to this lease for the six-month period ended June 30, 2022.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements