What changed in this filing

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Item 1. Financial Statements

2023-08-09 compared with 2023-05-09 · 133 added, 70 removed, 484 unchanged (30% of the section changed)

35 unchanged sentences

Preferred stock, $ 0.0001 par value;

10,000,000 shares authorized and no shares issued or outstanding as of March 31, 2023 and December 31, 2022

Common stock, $ 0.0001 par value, 400,000,000 shares authorized at March 31, 2023 and December 31, 2022;

306,790,000 and 297,183,000 shares issued and outstanding at March 31, 2023 and December 31, 2022, respectively

31,000 30,000

10,000,000 shares authorized at June 30, 2023 and December 31, 2022;

no shares issued and outstanding at June 30, 2023 and December 31, 2022

Common stock, $ 0.0001 par value, 400,000,000 shares authorized at June 30, 2023 and December 31, 2022;

33,240,000 and 29,718,000 shares issued and outstanding at June 30, 2023 and December 31, 2022, respectively

Additional paid-in capital 639,814,000 599,234,000

7 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2023 2022 2023 2022

Product revenue $ 6,609,000 $ 4,795,000 $ 12,056,000 $ 9,001,000

24 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2023 2022 2023 2022

$ ( 38,912,000 ) $ ( 32,158,000 ) $ ( 76,038,000 ) $ ( 62,112,000 )

Other comprehensive income (loss):

6 unchanged sentences

BIONANO GENOMICS, INC.

Condensed Consolidated Statements of Stockholders’ Equity (Deficit) (Unaudited)

Condensed Consolidated Statements of Stockholders’ Equity (Deficit)

Common Stock Additional

7 unchanged sentences

Net loss — — — ( 29,952,000 ) — ( 29,952,000 )

Other comprehensive loss — — — — ( 1,098,000 ) ( 1,098,000 )

Other comprehensive income (loss) — — — — ( 1,098,000 ) ( 1,098,000 )

Balance at March 31, 2022 28,969,000 $ 3,000 $ 558,890,000 $ ( 246,071,000 ) $ ( 1,637,000 ) $ 311,185,000

Stock option exercises 25,000 — 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 ( 3,000 ) — — — — —

Issue stock for employee stock purchase plan 15,000 — 75,000 — — 75,000

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

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

Balance at June 30, 2022 29,006,000 $ 3,000 $ 564,878,000 $ ( 278,229,000 ) $ ( 1,918,000 ) $ 284,734,000

Balance at January 1, 2023 29,718,000 $ 3,000 $ 599,234,000 $ ( 348,715,000 ) $ ( 1,124,000 ) $ 249,398,000

6 unchanged sentences

Balance at March 31, 2023 30,679,000 $ 3,000 $ 617,987,000 $ ( 385,839,000 ) $ ( 665,000 ) $ 231,486,000

Stock option exercises — — 1,000 — 1,000

Stock-based compensation expense — — 3,932,000 — 3,932,000

Issue common stock, net of issuance costs 2,552,000 — 17,802,000 — 17,802,000

Issuance of common stock due to the vesting of restricted stock units, net of shares withheld to cover taxes ( 6,000 ) — — —

Issue stock for employee stock purchase plan 15,000 — 92,000 92,000

Net loss — — ( 38,912,000 ) ( 38,912,000 )

Other comprehensive income (loss) — — — 355,000 355,000

Balance at June 30, 2023 33,240,000 $ 3,000 $ 639,814,000 $ ( 424,751,000 ) $ ( 310,000 ) $ 214,756,000

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:

18 unchanged sentences

Investing Activities:

BioDiscovery acquisition, return of purchase consideration from escrow — 694,000

Purigen acquisition, return of purchase consideration from escrow 96,000 694,000

Purchases of property and equipment ( 839,000 ) ( 371,000 )

8 unchanged sentences

Offering expenses on sale of common stock ( 837,000 ) —

Proceeds from sale of common stock under employee stock purchase plan 92,000 75,000

Proceeds from warrant and option exercises 23,000 152,000

12 unchanged sentences

Supplemental disclosure of non-cash investing and financing activities:

Transfer of instruments and servers from property and equipment into inventory $ — $ 544,000

Transfer of instruments and servers from inventory to property and equipment, net $ 4,615,000 $ 3,890,000

Property and equipment included in accounts payable $ 104,000 $ —

Construction in progress included in accounts payable $ 65,000 $ —

Operating lease liabilities resulting from obtaining right-of-use assets $ — $ 517,000

12 unchanged sentences

(“Purigen”) business, we offer nucleic acid extraction and purification solutions using proprietary isotachophoresis (“ITP”) technology.

Reverse Stock Split

On August 4, 2023, the Company filed a Certificate of Amendment to its Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware to effect a reverse stock split of all issued and outstanding shares of the Company’s common stock at a ratio of 1-for-10.

The reverse stock split did not change the par value or the authorized number of shares of the Company’s common stock.

The accompanying consolidated financial statements and notes to the consolidated financial statements present the retroactive effect of the reverse stock split on the Company’s common stock and per share amounts for all periods presented.

Basis of Presentation

10 unchanged sentences

The Company has experienced recurring net losses from operations, negative cash flows from operating activities, and accumulated deficit since its inception and expects to continue to incur net losses into the foreseeable future.

As of March 31, 2023, the Company had approximately $ 4.1 million in cash and cash equivalents, $ 91.7 million in short term investments, and working capital of $ 104.4 million.

The Company has an accumulated deficit of $ 385.8 million as of March 31, 2023.

During the three months ended March 31, 2023, the Company used $ 32.4 million cash in operations.

As of June 30, 2023, the Company had approximately $ 14.9 million in cash and cash equivalents, $ 62.2 million in short term investments, and working capital of $ 89.1 million.

The Company has an accumulated deficit of $ 424.8 million as of June 30, 2023.

During the six months ended June 30, 2023, the Company used $ 69.1 million cash in operations.

Management expects operating losses and negative cash flows to continue for at least the next year as the Company continues to incur costs related to research and commercialization efforts.

Management has prepared cash flows forecasts which indicate that based on the Company’s expected operating losses and negative cash flows, there is substantial doubt about the Company’s ability to continue as a going concern within twelve months after the date that the unaudited condensed consolidated financial statements for the three months ended March 31, 2023, are issued.

Management’s ability to continue as a going concern is dependent upon its ability to raise additional funding.

5 unchanged sentences

Significant Accounting Policies

During the three months ended March 31, 2023, 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, 2022.

During the three and six months ended June 30, 2023, 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, 2022.

Goodwill arises when the purchase price of an acquired business exceeds the fair value of the identifiable net assets acquired, with such excess recorded as goodwill on the balance sheet.

Goodwill is not subsequently amortized.

Goodwill is reviewed for impairment annually (during the fourth quarter) or more frequently if indications of impairment exist.

Goodwill is assigned to specific reporting units for purposes of impairment assessment.

The Company has determined that it has a single operating segment and a single reporting unit.

In testing goodwill for impairment, the Company will first assess qualitative factors to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying amount.

If the qualitative assessment indicates that it is more likely than not that the fair value of the reporting unit is less than its carrying value, then the Company will perform a quantitative impairment analysis by comparing the fair value of the reporting unit to the carrying value of the reporting unit, including goodwill.

An impairment charge for goodwill is recognized for the amount by which the carrying value of the reporting unit exceeds its fair value, not to exceed the total goodwill allocated to the reporting unit.

As of June 30, 2023, we performed a qualitative assessment of goodwill impairment which included an evaluation of changes in industry, market and macroeconomic conditions as well as consideration of our financial performance and any significant trends.

Our qualitative assessment indicated that it was not more likely than not that goodwill is impaired as of June 30, 2023.

If we experience a sustained decline in our stock price or other material changes in the significant assumptions that affect the determination of the fair value of the Company’s single reporting unit, it may result in a goodwill impairment charge in future periods, and such charge may be material.

Recently Adopted Accounting Pronouncements

17 unchanged sentences

Restricted stock is treated as outstanding for accounting purposes.

For all periods presented, there is no difference in the number of shares used to calculate basic and diluted shares outstanding because all potentially dilutive securities were anti-dilutive.

For all periods presented, there is no difference in the

number of shares used to calculate basic and diluted shares outstanding because all potentially dilutive securities were anti-dilutive.

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):

2023 March 31,

2023 June 30,

Stock options 3,346,000 2,359,000

4 unchanged sentences

Total 4,041,000 3,231,000

Revenue Recognition

R evenue Recognition

Revenue by Source

Three Months Ended March 31,

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

2023 2022 2023 2022

Instruments $ 2,450,000 $ 2,446,000 $ 4,346,000 $ 4,042,000

4 unchanged sentences

Total revenue $ 8,662,000 $ 6,670,000 $ 16,077,000 $ 12,366,000

The Company has revised the classification of its revenue between the categories in the table above for the March 31, 2022 statement of operations.

In the March 31, 2022 statement of operations, “software” was included in “service and other.”

The Company has revised the classification of its revenue between the categories in the table above for the June 30, 2022 statement of operations.

In the June 30, 2022 statement of operations, “software” was included in “service and other.”

Revenue by Geographic Location

Three Months Ended March 31,

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

2023 2022 2023 2022

$ % $ % $ % $ %

Americas $ 4,313,000 50 % $ 2,611,000 39 % $ 7,757,000 48 % $ 5,940,000 48 %

9 unchanged sentences

The impact of this change on prior period disclosures is immaterial.

For the three months ended March 31, 2023 and 2022, the United States represented 41.2 % and 45.0 % of total revenue, respectively.

No other countries represented greater than 10% of revenue during the three months ended March 31, 2023 and 2022.

For the three months ended June 30, 2023 and 2022, the United States represented 39.1 % and 37.4 % of total revenue, respectively.

For the six months ended June 30, 2023 and 2022, the United States represented 40.1 % and 40.9 % of total revenue, respectively.

For the three and six months ended June 30, 2023, China represented 15.0 % and 10.2 % 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, 2023 and 2022.

Remaining Performance Obligations

As of March 31, 2023, the estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied was approximately $ 1.3 million.

As of June 30, 2023, the estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied was approximately $ 1.2 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 $ 0.7 million and $ 0.3 million during the three months ended March 31, 2023 and 2022, respectively, which was included in the contract liability balance at the end of the previous year.

The Company recognized revenue of approximately $ 0.4 million and $ 0.2 million during the three months ended June 30, 2023 and 2022, respectively, which was included in the contract liability balance at the end of the previous year, and revenue of approximately $ 1.1 million and $ 0.5 million during the six months ended June 30, 2023 and 2022, respectively, which was included in the contract liability balance at the end of the previous year.

Balance Sheet Account Details

5 unchanged sentences

$ 7,613,000 $ 7,022,000

Changes to the allowance for credit losses during the three months ended March 31, 2023 were as follows:

Changes to the allowance for credit losses during the six months ended June 30, 2023 were as follows:

Allowance for Credit Losses

2 unchanged sentences

Write-offs and payments 36,000

Balance as of March 31, 2023

Balance as of June 30, 2023

$ ( 262,000 )

11 unchanged sentences

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

March 31, 2023

June 30, 2023

December 31, 2022

4 unchanged sentences

Intangibles, net $ 48,380,000 $ ( 10,923,000 ) $ 37,457,000 $ 48,380,000 $ ( 7,339,000 ) $ 41,041,000

Intangible assets not subject to amortization totaled $ 0.1 million at March 31, 2023 and December 31, 2022, and related to the Company’s domain name.

Intangible assets not subject to amortization totaled $ 0.1 million at June 30, 2023 and December 31, 2022, and related to the Company’s domain name.

Accrued Expenses

11 unchanged sentences

Stockholders’ Equity and Stock-Based Compensation

Reverse Stock Split

On August 4, 2023, the Company completed a reverse stock split of its outstanding shares of common stock pursuant to which every 10 shares of issued and outstanding common stock were exchanged for one share of common stock.

No fractional shares were issued in the reverse stock split.

Instead, the Company paid cash (without interest) equal to such fraction multiplied by $ 5.90 per share (a price equal to the average of the closing sales prices of the common stock on The Nasdaq Capital Market during regular trading hours for the five consecutive trading days immediately preceding August 4, with such average closing sales prices being adjusted to give effect to a Reverse Stock Split).

All share and per share amounts included within these condensed consolidated financial statements have been retrospectively adjusted to reflect the reverse stock split.

Cowen At-the-Market Facility

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, which was amended on March 9, 2023 to decrease the maximum aggregate offering price to $ 200.0 million for sales made on and after the date of the amendment (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 2022, the Company sold approximately 0.7 million shares of common stock under the Cowen ATM at an average share price of $ 34.59 per share, and received gross proceeds of approximately $ 23.1 million before deducting offering costs of $ 0.6 million.

During the first quarter of 2023, the Company sold approximately 9.5 million shares of common stock under the Cowen ATM at an average share price of $ 1.60 per share, and received gross proceeds of approximately $ 15.2 million before deducting offering costs of $ 0.4 million.

During the six months ended June 30, 2023, the Company sold approximately 3.5 million shares of common stock under the Cowen ATM at an average share price of $ 9.56 per share, and received gross proceeds of approximately $ 33.5 million before deducting offering costs of $ 0.8 million.

From July 1, 2023 through the date of the filing of this Quarterly Report on Form 10-Q, the Company has sold approximately 2.1 million shares of common stock under the Cowen ATM at an average share price of $ 6.16 per share, and received gross proceeds of approximately $ 13.0 million before deducting offering costs of $ 0.3 million.

Stock Warrants

A summary of the Company’s warrant activity during the three months ended March 31, 2023 was as follows:

A summary of the Company’s warrant activity during the six months ended June 30, 2023 was as follows:

Shares of Stock under Warrants Weighted-

5 unchanged sentences

Canceled — — — —

Outstanding at March 31, 2023

Outstanding at June 30, 2023

436,000 $ 59.60 0.27 $ —

Stock Options

A summary of the Company’s stock option activity during the three months ended March 31, 2023 was as follows:

A summary of the Company’s stock option activity during the six months ended June 30, 2023 was as follows:

Shares of Stock under Stock Options Weighted-

5 unchanged sentences

Canceled ( 233,000 ) 28.20 —

Outstanding at March 31, 2023

Outstanding at June 30, 2023

3,346,000 $ 26.60 8.63 $ 148,000

Vested and exercisable at March 31, 2023

Vested and exercisable at June 30, 2023

1,108,000 $ 33.90 7.68 $ 131,000

For the three months ended March 31, 2023, the weighted-average grant date fair value of stock options granted was $ 1.07 per share.

For the three months ended June 30, 2023, the weighted-average grant date fair value of stock options granted was $ 5.36 per share.

For the six months ended June 30, 2023, the weighted-average grant date fair value of stock options granted was $ 9.47 per share.

Stock-Based Compensation

1 unchanged sentence

Three Months Ended

June 30, Six Months Ended

2023 2022 2023 2022

Cost of product revenue $ 154,000 $ — $ 256,000 $ —

5 unchanged sentences

Three Months Ended

June 30, Six Months Ended

2023 2022 2023 2022

Risk-free interest rate 3.9 % 2.8 % 3.9 % 2.1 %

12 unchanged sentences

Restricted Stock Units and Performance Stock Units

The following table summarizes RSU activity during the three months ended March 31, 2023:

The following table summarizes RSU activity during the six months ended June 30, 2023:

Stock Units Weighted- Average Grant Date Fair Value per Share

3 unchanged sentences

Forfeited ( 17,000 ) 16.30

Outstanding at March 31, 2023

Outstanding at June 30, 2023

230,000 $ 16.30

The total intrinsic value of the RSUs that vested during the three months ended March 31, 2023 was $ 0.3 million, determined as of the date of vesting.

The weighted average remaining contractual term for the RSUs is 3.5 years as of March 31, 2023.

The following table summarizes PSU activity during the three months ended March 31, 2023:

The total intrinsic value of the RSUs that vested during the six months ended June 30, 2023 was $ 0.5 million, determined as of the date of vesting.

The weighted average remaining contractual term for the RSUs is 3.6 years as of June 30, 2023.

The following table summarizes PSU activity during the six months ended June 30, 2023:

Stock Units Weighted- Average Grant Date Fair Value per Share

1 unchanged sentence

Forfeited — —

Outstanding at March 31, 2023

Outstanding at June 30, 2023

29,000 $ 47.4

The weighted average remaining contractual term for the PSUs is 2.1 years as of March 31, 2023.

The weighted average remaining contractual term for the PSUs is 0.5 years as of June 30, 2023.

Executive Option Grants and RSUs

6 unchanged sentences

The closing of the sale and purchase of the share of Series A Preferred was completed on April 13, 2023.

The share of Series A Preferred will have 3.0 billion votes, but has the right to vote only on a proposal submitted to the stockholders of the Company to adopt an amendment, or a series of alternate amendments, to the Company’s Amended and Restated Certificate of Incorporation, as amended, to combine the outstanding shares of Common Stock into a smaller number of shares of Common Stock at a ratio specified in or determined in accordance with the terms of such amendment or series of alternate amendments (“Reverse Stock Split Proposal”), and will have no voting rights (i) except with respect to a Reverse Stock Split Proposal and the votes of the share of Series A Preferred are required to be cast for and against such Reverse Stock Split Proposal in the same proportion as shares of Common Stock are voted for and against such Reverse Stock Split Proposal (with any shares of Common Stock that are not voted, whether due to abstentions, broker non-votes or otherwise not counted as votes for or against a Reverse Stock Split Proposal) and (ii) unless the holders of one-third (1/3rd) of the outstanding shares of Common Stock are present and vote, in person or by proxy, at the meeting of stockholders at which a Reverse Stock Split Proposal is submitted for stockholder approval (or any adjournment thereof).

The share of Series A Preferred will vote together with the Common Stock as a single class on a Reverse Stock Split Proposal.

The Series A Preferred has no other voting rights, except as may be required by the General Corporation Law of the State of Delaware.

The outstanding share of Series A Preferred will be redeemed in whole, but not in part, for a redemption price of $ 100.00 , payable out of funds lawfully available therefor, (i) if such redemption is ordered by the Company’s Board of Directors in its sole discretion, automatically and effective on such time and date specified by the Board of Directors in its sole discretion, or (ii) automatically immediately following the approval by the stockholders of a Reverse Stock Split Proposal.

The share of Series A Preferred was entitled 3.0 billion votes, but had the right to vote only on a proposal submitted to the stockholders of the Company to adopt an amendment, or a series of alternate amendments, to the Company’s Amended and Restated Certificate of Incorporation, as amended, to combine the outstanding shares of Common Stock into a smaller number of shares of Common Stock at a ratio specified in or determined in accordance with the terms of such amendment or series of alternate amendments (“Reverse Stock Split Proposal”), and had no voting rights (i) except with respect to a Reverse Stock Split Proposal and the votes of the share of Series A Preferred were required to be cast for and against such Reverse Stock Split Proposal in the same proportion as shares of Common Stock were voted for and against such Reverse Stock Split Proposal (with any shares of Common Stock that were not voted, whether due to abstentions, broker non-votes or otherwise not counted as votes for or against a Reverse Stock Split Proposal) and (ii) unless the holders of one-third (1/3rd) of the outstanding shares of Common Stock were present and voted, in person or by proxy, at the meeting of stockholders at which the Reverse Stock Split Proposal was submitted for stockholder approval (or any adjournment thereof).

The share of Series A Preferred voted together with the Common Stock as a single class on the Reverse Stock Split Proposal at the Company’s 2023 Annual Meeting of Stockholders held on June 14, 2023.

The Series A Preferred had no other voting rights, except as may have been required by the General Corporation Law of the State of Delaware.

The outstanding share of Series A Preferred was redeemed in whole, for a redemption price of $ 100.00 , paid out of funds lawfully available therefor automatically immediately following the approval by the stockholders of the Reverse Stock Split Proposal on June 14, 2023.

Commitments and Contingencies

1 unchanged sentence

See Note 11 – Commitments and Contingencies, subsection titled “Leases”, in Part II, Item 8 of the Annual Report on Form 10-K for the year ended December 31, 2022 for information regarding the Company’s lease agreements.

The future minimum payments under non-cancellable operating and finance leases as of March 31, 2023, are as follows:

The future minimum payments under non-cancellable operating and finance leases as of June 30, 2023, are as follows:

Operating Leases Finance Lease

21 unchanged sentences

As permitted under ASC 805, the Company is allowed a measurement period, which may not exceed one year, in which to complete its accounting for the acquisition.

Per the terms of the Purigen Merger Agreement, the purchase price is still subject to adjustment for the final determination of cash, unpaid indebtedness, unpaid transaction expenses and working capital, as well for deferred and current tax assets and liabilities.

The following is the estimated purchase price for the acquisition of Purigen:

Per the terms of the Purigen Merger Agreement, the purchase price is still subject to adjustment for the final determination of deferred and current tax assets and liabilities.

During the second quarter of 2023, the Company recorded an increase in the estimated return of cash to buyer from escrow in the amount of $ 5,000 , with the offset recorded to goodwill.

The following is the purchase price for the acquisition of Purigen:

Cash $ 32,034,000

Estimated fair value of milestone consideration 12,970,000

Estimated return of cash to buyer from escrow ( 90,000 )

Total estimated purchase price $ 44,914,000

The total estimated purchase price was allocated to Purigen’s tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date, with the excess recorded as goodwill, as follows:

Return of cash to buyer from escrow ( 95,000 )

Total purchase price $ 44,909,000

The total purchase price was allocated to Purigen’s tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date, with the excess recorded as goodwill, as follows:

Cash & cash equivalents $ 290,000

24 unchanged sentences

The unaudited pro forma financial information in the table below summarizes the combined results of operations for the Company and Purigen as if the companies had been combined as of the beginning of the year prior to the acquisition.

These amounts have been calculated after applying the Company’s accounting policies and adjusting the results of Purigen to reflect

the additional amortization that would have been charged assuming the fair value adjustments to intangible assets had been applied at the beginning of the year prior to the acquisition.

These amounts have been calculated after applying the Company’s accounting policies and adjusting the results of Purigen to reflect the additional amortization that would have been charged assuming the fair value adjustments to intangible assets had been applied at the beginning of the year prior to the acquisition.

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 acquisition had taken place as of January 1, 2021.

Three Months Ended March 31,

Three Months Ended June 30 Six Months Ended June 30,

Revenue $ 7,232,000 $ 13,452,000

1 unchanged sentence

Basic and diluted net loss per share

$ ( 1.21 ) $ ( 2.33 )

Investments and Fair Value Measurements

2 unchanged sentences

The investment service provider values the securities using a hierarchical security pricing model that relies primarily on valuations provided by an industry-recognized valuation service.

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, 2023 and December 31, 2022:

March 31, 2023

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 June 30, 2023 and December 31, 2022:

June 30, 2023

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

25 unchanged sentences

Assumptions used to estimate the acquisition date fair value of the contingent consideration related to the acquisition of BioDiscovery include the probability of achieving, or changes in timing, of certain milestones, and a discount rate.

As of March 31, 2023 a discount rate of 3 % was used.

As of June 30, 2023 a discount rate of 3 % was used.

The Company determined the fair value of the BioDiscovery milestone consideration using a scenario-based technique, as the trigger for payment is event driven.

The Company determined it is highly likely that the milestone related to the BioDiscovery acquisition will be achieved and therefore used a 100 % probability factor which is applied to the $ 10.0 million milestone consideration.

The change in fair value of the contingent consideration during the three months ended March 31, 2023 was due to the passage of time.

The change in fair value of the contingent consideration during the six months ended June 30, 2023 was due to the passage of time, in addition to accreting the balance up to the full value of the milestone to be paid of $ 10.0 million for a total change of $ 0.6 million.

Contingent consideration liabilities related to the Purigen milestones are related to the achievement of two independent milestones with aggregate possible milestone payments totaling $ 32.0 million.

4 unchanged sentences

A Monte Carlo Simulation was performed to determine the likelihood that the milestone will be achieved and was applied to the milestone consideration payment.

Changes in estimated fair value of contingent consideration liability in the three months ended March 31, 2023 is as follows:

The change in fair value of the contingent consideration during the six months ended June 30, 2023 was $ 1.6 million

Changes in estimated fair value of contingent consideration liability in the six months ended June 30, 2023 is as follows:

Consideration

3 unchanged sentences

Cash payments —

Balance as of March 31, 2023

Balance as of June 30, 2023

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

Consideration

Balance as of January 1, 2022 $ 9,066,000

Liability recorded as a result of current period acquisition —

Change in estimated fair value, recorded in selling, general and administrative expenses 158,000

Cash payments —

Balance as of June 30, 2022

Available for Sale Investments

8 unchanged sentences

Moreover, 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.

Based on this evaluation, as of March 31, 2023 and December 31, 2022, the Company determined that unrealized losses of the below securities were primarily attributable to changes in interest rates and non-credit related factors.

Based on this evaluation, as of June 30, 2023 and December 31, 2022, the Company determined that unrealized losses of the below securities were primarily attributable to changes in interest rates and non-credit related factors.

As such, no allowances for credit losses were recorded during these periods.

As of March 31, 2023 and December 31, 2022, the Company held 17 and 16 securities, respectively, which have been in an unrealized loss position for a period of less than 12 months.

As of March 31, 2023 and December 31, 2022, the Company held 19 and 24 securities, respectively, which have been in an unrealized loss position for a period of greater than 12 months.

As of June 30, 2023 and December 31, 2022, the Company held 15 and 16 securities, respectively, which have been in an unrealized loss position for a period of less than 12 months.

As of June 30, 2023 and December 31, 2022, the Company held 11 and 24 securities, respectively, which have been in an unrealized loss position for a period of greater than 12 months.

Realized gains and losses are calculated using the specific identification method and recorded in other income (expense) in the Company’s unaudited condensed consolidated statements of operations and comprehensive loss.

The Company has the ability, if necessary, to liquidate any of its cash equivalents and marketable securities to meet its liquidity needs in the next 12 months.

Interest receivable as of March 31, 2023 and December 31, 2022 was $ 0.6 million and $ 0.5 million, respectively, and is recorded as a component of prepaid expenses and other current assets on the unaudited condensed consolidated balance sheets.

As of March 31, 2023, the following table summarizes the amortized cost and the unrealized gains/losses of the available for sale securities:

Interest receivable as of June 30, 2023 and December 31, 2022 was $ 0.4 million and $ 0.5 million, respectively, and is recorded as a component of prepaid expenses and other current assets on the unaudited condensed consolidated balance sheets.

As of June 30, 2023, the following table summarizes the amortized cost and the unrealized gains/losses of the available for sale securities:

Remaining Contractual Maturity (in years) Amortized Cost Unrealized Gains Unrealized Losses Aggregate Estimated Fair Value

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Total $ 109,182,000 $ 1,000 $ ( 1,088,000 ) $ 108,095,000

As of March 31, 2023, the following table summarizes available-for-sale securities in an unrealized loss position with no credit losses reported:

As of June 30, 2023, the following table summarizes available-for-sale securities in an unrealized loss position with no credit losses reported:

Less Than 12 Months 12 Months or Greater Total

16 unchanged sentences

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